At what point does shit hit the fan for these? It feels like over a year of them being “financially fucked” but they still survive on both on and off the pitch. Not financially clued up so genuinely asking is there a specific point in time that would tip them over the edge?
It's a lot longer than a year. Everton have made an operating loss for nearly 10 years straight (they made a £5m profit in 2014 after a loss in 2013). Back then quite afew on here were predicting future problems financially for Everton (myself included) based on the age of the squad, the growing costs of being competitive, the decrepit ground that needed replacing and the fact the club had nop growtrh factor in their revenue beyond rising broadcasting income. The reason Moshiri became involved was a tacit admission that Everton needed a new direction, in particular gaining access to funding to build a new stadium.
At the time Everton looked at a number of options and eventually chose the most complex and costly route, largely because Moshiri promised easy money (Usmanov, apparently) and the city council were offering to fund a huge lump of the stadium on the cheap. Since then the council money and Usmanov money have not materialised. Instead Moshiri loaded the club with debt, using his loaned money to buy out club shares and then taking that money as chairman and spending it on players. To cover that model they renamed that money as 'equity' but ultimately it was owed by the club to Moshiri. Now, it is Moshiri's money (though some would suggest it is usmanov), but it was never a gift, that's the crucial bit.
When the war in the Ukraine started a lot of people complained that Everton had been hard done by, losing a crucial income stream. However, the deep borrowing at high fin ancial risk had started long before then, as Moshiri had failed to get cheap income and instead borrowed at high rates to start stadium construction, but without all the money required in place.
There were a number of points where Everton could have given up the difficult and expensive BMD option, but chose to risk it and go ahead instead. At each stage they have doubled down instead of easing off. Think of a car careening out of control where the owner accelrates instead of braking, trying to drive out of the spin. However, they have painted themselves into a corner and made the situation worse and worse. At this point they need non-business money (as only idiots would invest in a billion pound loss-making exercise where 4 different lenders have 4 different controls in place and one bad season would wipe out your investment), i.e. petrodollars. The problem there is that Everton have been available for takeover for quite a while and nobody with silly money has looked even remotely interested.
The word last month was the money had run out and a takeover had to occur or the jig was up. That does not appear to have been the case, but losing an estimated £20m a month on wages, salaries and interest is not sustainable. The crunch has to come soon, possibly before the season, likely over the summer. Either the great escape is realised twice 9pitch and board room) or they blow up spectacularly.
