Topic: LFC announces financial results for year to May 2016

[CraigDS]

http://www.liverpoolfc.com/news/announcements/255334-lfc-announces-financial-results-for-year-to-may-2016

Liverpool FC has filed its annual accounts for the year to May 31, 2016 reporting that revenues are continuing to grow, creating further financial stability for the club.

Overall revenue increased to a record £301m and has grown year on year since Fenway Sports Group (FSG) took ownership of LFC in October 2010. Media revenue and matchday revenue increased, mainly as a result of the club reaching two cup finals and a successful pre-season tour in Asia and Australia.

Commercial revenues remained strong despite the construction of the Main Stand at Anfield impacting on access to the stadium on a non-matchday. Ten new partnerships were announced during the reporting period, including Draftkings, Vixlet, Claymore Wines and Skype; while four existing partners renewed their deals, further demonstrating the club’s global appeal. The club also launched an official LFC online store on the JD.com marketplace in China - becoming the first football club in Europe to do so.

Digitally, there was an 18 per cent increase in new followers, taking the overall total to over 50 million across the club’s social media platforms. New LFC websites were also launched in Arabic, French and Spanish.

Despite overall revenue increasing, the club reported a loss of £19.8m for the period, mainly as a result of further investment and turnover in the first-team squad. Twelve additions were made to the first team, including Roberto Firmino, James Milner, Marko Grujic, Danny Ings, Nathaniel Clyne and Joe Gomez. Young player development also continues to be an important part of the club’s football strategy, with 12 Academy players offered professional contracts.

Andy Hughes, chief operating officer at Liverpool Football Club, said: “These results demonstrate the solid financial progress that’s been made over the past six years under the leadership of FSG with continued investment in the playing squad and the completion of the main stand.

“The increase in the underlying revenue adds further strength to the club’s financial position despite the cost of football rising with player transfer fees, wages and agents’ costs.

“During this reporting period, we also agreed a new five-year credit facility, which further secures the club’s long-term financial stability.

“All three main revenue streams continue to show strength and commercial revenues held firm irrespective of the impact of the Main Stand at Anfield.”

Liverpool is the only club in the top 10 of the Deloitte Football Money League that didn’t play in the UEFA Champions League last season - demonstrating the strength of its commercial operations to support reinvestment into the playing squad.

Since the reporting period, the club has continued to grow its partnership portfolio, with Bet Victor, Malaysia Airlines, Konami and Alcatel all joining up.

Hughes added: “Since this reporting period, which is nearly a year ago, we have continued to make solid financial progress and we expect to see further growth in our revenues following the successful opening of the Main Stand and the new media deal.

“Our commercial operations continue to thrive through new partnerships, global retail growth and developing our international soccer schools, with our newest Academy opening recently in Australia.

“Being able to connect directly with supporters around the world is extremely important and a key part of our digital strategy. We continue to see more and more supporters joining our channels and we are approaching seven million followers on our global Twitter account.

“The investments from this ownership have been a key factor to our financial and global progress. We have seen continued investment in the playing squad; the expanded Main Stand; the new flagship retail store opening later this year; fully refurbished retail stores in Liverpool and Belfast; and we are consulting on a proposed development at our Academy in Kirkby to bring together the first team and our young players.

“These investments all contribute to further progress and strengthen the club’s financial position which ultimately serves to support all of our football ambitions.”

Financial summary

• Revenue increased by £3.9m to  £301.8m
• Media revenue increased by £1m to £123.6m
• Match day revenue increased by £3.4m to £62.4m
• Commercial revenue decreased by £0.7m to £115.7m
• The loss before tax was £19.8 million
• LFC maintain ninth position in Deloitte Football Money League

[CraigDS]

Actual accounts aren't on Companies House yet, so can't delve into the actual figures which could show some interesting bits.

[killer-heels]

On the face of it then we could be looking a big increase in revenue for the current accounting period? I know we will have had some expenditure (contracts, main stand, no european footie) but there should be increased revnues.

[CraigDS]

On the face of it then we could be looking a big increase in revenue for the current accounting period.

Lack of Europe will see it drop somewhat, but we'll see the added income from the new Main (will be really interesting to see how large that is).

[Redman0151]

Anybody know when it's getting paraded outside St Georges hall? Should get similar numbers to the CL celebration.

An 18% increase in digital followers, that's what football is all about baby!

[killer-heels]

Lack of Europe will see it drop somewhat, but we'll see the added income from the new Main (will be really interesting to see how large that is).

Premier League revenues have jumped massively and player outgoings/incomings dont put us much in the red even if you take into account signing on fees.

Will the cost of the stand construction be lumped onto a single accounting period?

[Johnny Foreigner]

Match day revenues increased by 6 %. Increased prices and/or more matches I assume..

Commercial revenues decreasing.. Not good..

[CraigDS]

Premier League revenues have jumped massively and player outgoings/incomings dont put us much in the red even if you take into account signing on fees.

Will the cost of the stand construction be lumped onto a single accounting period?

We're showing a loss in these accounts, so I'm going to assume that's down to some of the spending on the new Main. That should see it over a couple of sets of accounts.

[Pistolero]

Anybody know when it's getting paraded outside St Georges hall?

A gigantic spreadsheet is being beamed onto the side of the cathedral....I'm getting down there early before they close off Hope st....

[killer-heels]

We're showing a loss in these accounts, so I'm going to assume that's down to some of the spending on the new Main. That should see it over a couple of sets of accounts.

Ok so on a basic level the massive increase in Premier League revenues due to the new deal, increased matchday revenue and a modest level of outgoings in terms or transfers should result in massively healthy numbers next season, even if you factor in no Europe.

Not that we should be even worrying about these sorts of things.

[Johnny Foreigner]

We're showing a loss in these accounts, so I'm going to assume that's down to some of the spending on the new Main. That should see it over a couple of sets of accounts.

I assume that spending is put as investments/assets and put on the balance sheet, and starts depreciating now..

[Grobbelrevell]

Commercial revenues decreasing.. Not good..

That bit jumped out at me too. Fairly sure we've lost a number of commercial partners over the last couple of years, which might've had an impact on that.

[CraigDS]

Ok so on a basic level the massive increase in Premier League revenues due to the new deal, increased matchday revenue and a modest level of outgoings in terms or transfers should result in massively healthy numbers next season, even if you factor in no Europe.

Not that we should be even worrying about these sorts of things.

Will definitely show good numbers, yeah.

What will be more interesting is the amount of money put in (from owners) compared to spending on the Main, and what sort of cash we're holding given the relatively low net spend. Issue is a lot of that comes after these accounts, so won't show up so much in the actual accounts when available on Companies House.

[killer-heels]

That bit jumped out at me too. Fairly sure we've lost a number of commercial partners over the last couple of years, which might've had an impact on that.

Its not really a surprise is it?

[CraigDS]

That bit jumped out at me too. Fairly sure we've lost a number of commercial partners over the last couple of years, which might've had an impact on that.

10 new deals during that accounting period according to the snippet above. Not sure how many didn't renew.

[Johnny Foreigner]

10 new deals during that accounting period according to the snippet above. Not sure how many didn't renew.

And number of deals have absolutely no relevance; commercial revenues are falling and any corporations would try to sugar coat that…

[CraigDS]

And number of deals have absolutely no relevance; commercial revenues are falling and any corporations would try to sugar coat that…

It has relevance in so far that if shows we are attracting new deals.

Pointing out a £0.7m drop without any further info tells up extremely little. However we both know why you're doing it so you may as well carry on.

[DonkeyWan]

And number of deals have absolutely no relevance; commercial revenues are falling and any corporations would try to sugar coat that…

Think the article said that was in part down to construction on the new stand restricting access on non-match days. Sounds like baloney to me though.

[Cpt_Reina]

Will wait for some proper analysis on it but on the face of it, adding partners but decreasing commercial revenues hardly seems to be a positive.

[JackWard33]

Wait for the full accounts to be published and the Swiss Ramble analysis (and others) before commenting

[Grobbelrevell]

Will wait for some proper analysis on it but on the face of it, adding partners but decreasing commercial revenues hardly seems to be a positive.

Indeed.

[Red Viper]

So off the back of this does anybody still think there's going to be significant investment in the squad this summer? Because I just don't see it happening.

[CraigDS]

So off the back of this does anybody still think there's going to be significant investment in the squad this summer? Because I just don't see it happening.

Can't tell anything from this, and probably not from the actual accounts given it's only a snapshot as of 31st May 2016.

If the Main has been paid for via a loan from the owners (should show in the accounts even as a post date transaction) then should be no reason money isn't there from previous windows, as well as increased revenues from the last year.

[El Lobo]

 

[killer-heels]

So off the back of this does anybody still think there's going to be significant investment in the squad this summer? Because I just don't see it happening.

On the contrary, it tells us that we have loads to spend. We will see significant increase in revenues from last year and very little expenditure in the next set of accounts. We have loads of money to spend.

Plus the club has said it expects significant improvement in the current accounting period so next summers spending wont even be touched by that.

We are in a healthy position off the field. We now need the board and management to show some ambition on the field and invest. No more plodding about trying to outsmart others.

[whiteboots]

The accounts are sound as a business.

The problem for the football club is that all growth within the period of FSG's ownership has ben driven by windfall growth experienced by our competitors too. Our financial strength relative to our peers is unchanged.

I do not blame FSG for this. Money is not being siphoned out of the club, and being made available for transfers as the value of the club grows.

[Red Viper]

On the contrary, it tells us that we have loads to spend. We will see significant increase in revenues from last year and very little expenditure in the next set of accounts. We have loads of money to spend.

Plus the club has said it expects significant improvement in the current accounting period so next summers spending wont even be touched by that.

We are in a healthy position off the field. We now need the board and management to show some ambition on the field and invest. No more plodding about trying to outsmart others.

How so? No European football this year so it seems ambitious to think our revenue will increase on last year. You'd expect our match day revenue will continue to increase with the new stand but that's about it.

We've given bumper contracts to several players this year and also the planned move to Kirkby is going to cost about £50m. So I just don't see a big net spend this summer. Hope I'm wrong.

[Johnny Foreigner]

It has relevance in so far that if shows we are attracting new deals.

Pointing out a £0.7m drop without any further info tells up extremely little. However we both know why you're doing it so you may as well carry on.

Match day revenues going up and commercial revenue going up is a fairly good indication.

We both know why I am posting.

I am just wondering if you still believe that investments in the new Main Stand would hurt the operating result ending may 2016.

[JP-65]

Guess that puts to bed the idea of "why aren't we spending our profits", a one season wonder driven by timing of the Suarez sale

[El Lobo]

Those are shit results, right?

[CraigDS]

Match day revenues going up and commercial revenue going up is a fairly good indication.

How many home games did we play compared to the previous year? We did a run to the Europa final so suspect it could be more.

We both know why I am posting.

We both know why you're using headline figures without waiting to look at the details, yes.

I am just wondering if you still believe that investments in the new Main Stand would hurt the operating result ending may 2016.

Remains to be seen how they've accounted for it, I'll hold off until I see the actual accounts.

[cdav]

Guess that puts to bed the idea of "why aren't we spending our profits", a one season wonder driven by timing of the Suarez sale

Not necessarily, we won't know until the accounts are released but there could be exceptional items (relating to the main stand building, terminating Rodger's and his staff's contract, others one offs) that affect profit in these accounts.

I think the cash flow could be the most interesting item, we should see some indication that there is growth in cash in the bank and as such, available to spend this summer. I think in terms of revenue, we will be looking at over £350m in the next set of accounts due to the increase in TV money and the Main Stand now being used.

[CraigDS]

How many home games did we play compared to the previous year? We did a run to the Europa final so suspect it could be more.

28 in 14/15, 32 in 15/16.

Guess that explains the increase in revenue. Actually seems a small increase given the 4 extra games.

[Sir Psycho Sexy]

Anybody know when it's getting paraded outside St Georges hall? Should get similar numbers to the CL celebration.

An 18% increase in digital followers, that's what football is all about baby!

[Tiz Lad]

Next season and season after FSG will have the £50m needed for Kirkby to hide behind

[El Lobo]

Anybody know when it's getting paraded outside St Georges hall? Should get similar numbers to the CL celebration.

An 18% increase in digital followers, that's what football is all about baby!

Sadly seems to be, and that's not something to just chuck at our owners but everyone involved in football above supporter level.

[CraigDS]

Next season and season after FSG will have the £50m needed for Kirkby to hide behind

Where have you plucked this juicy bit of shite from?

[Tiz Lad]

Where have you plucked this juicy bit of shite from?

All over the press as £50m needed for Kirkby expansion and will be ready in 2years

[CraigDS]

All over the press as £50m needed for Kirkby expansion and will be ready in 2years

No, we know it's costing £50m. That isn't what I questioned.

I'm wondering about this part of your post "Next season and season after FSG will have the £50m".

Where will they have it from and what in the news that is out today has given you an indication that is where they will have it from?

[Tiz Lad]

Well somebody is going to find £50m in the next 2 seasons to fund it