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Liverpool Football Club finally released its accounts for 2019/20 today- and they didn't reveal much that isn't already known. The following thread presents some of the key points from the accounts.
Before I carry on, worth noting that I won't produce a long thread full of graphs to contextualise the numbers- @KieranMaguire has already put out a thread with such analysis and an even more detailed thread by @SwissRamble will follow in the coming days.
The turnover of £490m (comprised of £217m commercial, £201m boradcast and £71m matchday revenue) is in line with what was reported in the Deloitte Money League back in January. Had covid not come along, that figure would have been in the region of £540m-550m.
This current 20/21 financial year's turnover will be down again, likely around £450m, though around £28m of that will relate to last season's Premier League prize money (which concluded during this financial year).
The wage bill grew again, from £310m in 18/19 to £325m in 19/20. As I highlighted in a thread a couple of months ago, LFC has amongst the most incentivised pay structure for playing staff of Premier League clubs. On that basis, the 20/21 wage bill should be down significantly.
The wage-to-turnover ratio increased to 66%, which is above the usual levels the ratio has sat at for the Reds- though it's still comfortably below the ratio of clubs who are more financially cavalier, such as Everton (whose ratio for 19/20 hit 89%).
A lack of silverware this season, combined with fewer goals, wins and clean sheets, should all result in significantly lower bonus payments so the wage bill should be tens of millions less. It will go down further should the club fail to make next season's Champions League.
Commercial revenue was the only income stream that grew. As I noted a couple of months ago, this was largely fan-driven, with the last set of New Balance kits helping the club to generate £80m or more from that deal (a sizeable increase on the previous season's £64m from NB).
The Nike kit sales were said to be greater than last season's NB kits. The club nor Nike will release information on sales- so we will have to wait until the Deloitte Money League is published in January to see how much difference Nike's new deal has made to commercial income.
Looking at the cashflow statement, payments towards transfer fee instalments amounted to £122m, taking the total outlay between June 2017 and May 2020 to £450m. This should mean monies owing to selling clubs should be largely paid off, with relatively modest amounts left to repay
Net cash from operations (which strips away non-cash adjustments such as amortisation and depreciation) was a still healthy £92m, though the club decided to call on a £200m revolving credit facility to support its cash flow as it tried to navigate through the first lockdown.
My understanding is that, after the year ended, most of that borrowing was repaid as broadcast and other income streams resumed from June onwards. There is nothing in the accounts to suggest a wage deferral was implemented.
The accounts seem to suggest that, though they only take us up to the end of the third month of lockdown, the club managed finances in a responsible way. However, most fans will want to know if the accounts give any clue as to potential available funds to spend this summer.
The first item to note is the amount of monies paid towards transfer fee instalments (as noted earlier in the thread). Most funds owed appear to have been repaid. In addition, the costs of Kirkby were fully paid without borrowing- and the tail end of that project fell into 20/21.
This all means that, despite negligible levels of matchday revenue and with TV rebates to be paid, there should still be funds available to invest this summer. The club will need to generate money from sales, however, if it wishes to hand Edwards and Klopp with a sizeable kitty.
The club's owners, despite the massive investment from RedBird into FSG, will almost certainly not release those funds for any transfer activity but may well use some of those funds to start the Annie Rd. End expansion later this year.
I'll be delving into more detail on the accounts in a Money Talks podcast for @AnfieldIndexPro tomorrow.
