Author Topic: Liverpool’s financial statements over 10 years  (Read 2842 times)

Online Rory Fitzgerald

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Liverpool’s financial statements over 10 years
« on: July 30, 2020, 06:22:21 PM »


An overview of how the clubs revenues and cash flows have grown significantly but re-invested in wages and transfers.

Gives an idea of how we can cope without Match day revenue during COVID but also that large transfers are hard especially if it leads to senior players looking for parity with wages which we couldn’t afford.

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Re: Liverpool’s financial statements over 10 years
« Reply #1 on: July 30, 2020, 06:24:52 PM »
Can't see us signing anyone for any sort of fee over say 30m these next few weeks to be honest. The Werner situation was testament to that. To many unknowns at present and personally i think it's highly unlikely we'll see crowds back at grounds next season either.

Thankfully we have great owners and a manager who we all trust.

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Re: Liverpool’s financial statements over 10 years
« Reply #2 on: July 30, 2020, 10:30:14 PM »
Can't see us signing anyone for any sort of fee over say 30m these next few weeks to be honest. The Werner situation was testament to that. To many unknowns at present and personally i think it's highly unlikely we'll see crowds back at grounds next season either.

Thankfully we have great owners and a manager who we all trust.

I agree with all of that however if crowds don't come back sometime next season, yes we can cope but others might not. I wonder what the risk is of some Premier League clubs folding?

Offline bornandbRED

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Re: Liverpool’s financial statements over 10 years
« Reply #3 on: July 31, 2020, 02:42:18 AM »
Assuming that table is accurately compiled, that makes for very impressive viewing, and is the result of a decade’s worth of excellent operation. If we were listed on a stock market, it would read like a dream for shareholders.

Easy to see the impact of Covid considering match day income makes up for 15% of our total revenue. That’ll be a far bigger percentage for smaller clubs.

However, steep equity growth since 2017 highlights our ever increasing financial power. It’s clear we’re capable of making big (£50m+) capital outlays if we so wish, and are generally much, much more competitive in the transfer market than even 5 years ago.

Chuck in that we’ve consistently remained at around 50% wage to revenue ratio and the fact this will be reduced substantially by Clyne/Lallana/Lovren off the wage bill, and it almost makes me think perhaps we weren’t as hot as we all thought on Werner. That or the uncertainty over restart/rebates/competitons going ahead next season was too much at the time.




« Last Edit: July 31, 2020, 02:46:48 AM by bornandbRED »

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Re: Liverpool’s financial statements over 10 years
« Reply #4 on: July 31, 2020, 08:01:05 AM »
Assuming that table is accurately compiled, that makes for very impressive viewing, and is the result of a decade’s worth of excellent operation. If we were listed on a stock market, it would read like a dream for shareholders.

Easy to see the impact of Covid considering match day income makes up for 15% of our total revenue. That’ll be a far bigger percentage for smaller clubs.

However, steep equity growth since 2017 highlights our ever increasing financial power. It’s clear we’re capable of making big (£50m+) capital outlays if we so wish, and are generally much, much more competitive in the transfer market than even 5 years ago.

Chuck in that we’ve consistently remained at around 50% wage to revenue ratio and the fact this will be reduced substantially by Clyne/Lallana/Lovren off the wage bill, and it almost makes me think perhaps we weren’t as hot as we all thought on Werner. That or the uncertainty over restart/rebates/competitons going ahead next season was too much at the time.



Have we been 50% wages to turnover? I am sure i saw a few points it was at the high 60’s.

Offline bornandbRED

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Re: Liverpool’s financial statements over 10 years
« Reply #5 on: July 31, 2020, 10:16:41 AM »
Have we been 50% wages to turnover? I am sure i saw a few points it was at the high 60’s.

Over the last 5 years:

2015 - 48.8%
2016 - 61.2%
2017 - 51%
2018 - 51%
2019 - 52%

Assuming Lovren/Lallana/Clyne was £10m wages (was probably more), this year’s departures drop that under 50%. Lower revenue due to decreased match day income will spike the ratio in the next financial year - but temporarily before crowds return. We have good room to manoeuvre.

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Re: Liverpool’s financial statements over 10 years
« Reply #6 on: July 31, 2020, 10:21:43 AM »
Over the last 5 years:

2015 - 48.8%
2016 - 61.2%
2017 - 51%
2018 - 51%
2019 - 52%

Assuming Lovren/Lallana/Clyne was £10m wages (was probably more), this year’s departures drop that under 50%. Lower revenue due to decreased match day income will spike the ratio in the next financial year - but temporarily before crowds return. We have good room to manoeuvre.

There’s probably more people leaving I would assume like Shaq, but at the same time I would imagine a fair bit will be spent on bonuses for winning the PL, and while not a wage expense we may have to pay bonuses to some of the clubs we bought players from.

Online Rory Fitzgerald

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Re: Liverpool’s financial statements over 10 years
« Reply #7 on: July 31, 2020, 10:35:44 AM »
There’s probably more people leaving I would assume like Shaq, but at the same time I would imagine a fair bit will be spent on bonuses for winning the PL, and while not a wage expense we may have to pay bonuses to some of the clubs we bought players from.

Yeah, agree, those figures are up to 31/05/19 and the following day we won the European Cup so that will be captured in the figures up to 31/05/20.

Its like a natural hedge, when you are successful and win things, then revenue goes up. So when the bonuses kick in, we have higher income to pay it.

When we bought Alisson and Keita, we were very strong so winning the Champions League was on the radar, maybe their purchases might have contained such a clause.

The finances up to 31/05/20 will be impacted by 2 months of no gate receipts (April and May) given that we played until the end of March. I expect a healthy increase in cash generation for the next set of financial statements.

Also, look at the cash balance line. We typically had £50-70m of external debt with less than £10m of cash on hand. We now have £37m cash on hand and £50m of bank debt, giving us a net debt of £13m vs £65m at the end of 2017 when the stadium investment peaked.

But back to the natural hedge, the CL and PL will see the topline rise but also wages as you say. It may not filter through the wages line on the financials but there will be some cost somewhere.

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Re: Liverpool’s financial statements over 10 years
« Reply #8 on: July 31, 2020, 10:41:33 AM »
There’s probably more people leaving I would assume like Shaq, but at the same time I would imagine a fair bit will be spent on bonuses for winning the PL, and while not a wage expense we may have to pay bonuses to some of the clubs we bought players from.

Shaqiri and potentially Origi too.

Bonus payouts will be trumped by the additional income we receive for winning CL/PL. Our last set of accounts were to 31st May 2019 - so omits whatever additional income we received for Madrid, never mind what we’ve accrued from winning the PL this year.

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Re: Liverpool’s financial statements over 10 years
« Reply #9 on: July 31, 2020, 10:51:23 AM »
Assuming that table is accurately compiled, that makes for very impressive viewing, and is the result of a decade’s worth of excellent operation. If we were listed on a stock market, it would read like a dream for shareholders.

Easy to see the impact of Covid considering match day income makes up for 15% of our total revenue. That’ll be a far bigger percentage for smaller clubs.

However, steep equity growth since 2017 highlights our ever increasing financial power. It’s clear we’re capable of making big (£50m+) capital outlays if we so wish, and are generally much, much more competitive in the transfer market than even 5 years ago.

Chuck in that we’ve consistently remained at around 50% wage to revenue ratio and the fact this will be reduced substantially by Clyne/Lallana/Lovren off the wage bill, and it almost makes me think perhaps we weren’t as hot as we all thought on Werner. That or the uncertainty over restart/rebates/competitons going ahead next season was too much at the time.


Here's the squad Klopp largely inherited and here is the squad today. Less players but higher quality.
Picture comes out a bit small :D
Here is the link - https://i.ibb.co/s20xxnC/20-07-30-LFC-Squad.png


Offline bornandbRED

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Re: Liverpool’s financial statements over 10 years
« Reply #10 on: July 31, 2020, 11:01:35 AM »
Here's the squad Klopp largely inherited and here is the squad today. Less players but higher quality.
Picture comes out a bit small :D
Here is the link - https://i.ibb.co/s20xxnC/20-07-30-LFC-Squad.png



Going back even further to when they came in, it’s an unbelievable job that FSG have done. Year upon year growth across all revenue streams, transition to profitability and piles of equity where 10 years ago we had none, all whilst developing a world class playing squad. They are the model owners when it comes to living and growing within your means.

A key take away for me is that even with Covid, we’re in a good position to spend if we wanted to. If we don’t, it’s likely an entirely conscious decision and we’re happy to maintain the squad as it is, whilst building a sizeable war chest for when the time is right.

Online Rory Fitzgerald

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Re: Liverpool’s financial statements over 10 years
« Reply #11 on: July 31, 2020, 11:44:35 AM »
Going back even further to when they came in, it’s an unbelievable job that FSG have done. Year upon year growth across all revenue streams, transition to profitability and piles of equity where 10 years ago we had none, all whilst developing a world class playing squad. They are the model owners when it comes to living and growing within your means.

A key take away for me is that even with Covid, we’re in a good position to spend if we wanted to. If we don’t, it’s likely an entirely conscious decision and we’re happy to maintain the squad as it is, whilst building a sizeable war chest for when the time is right.

The things that impact cashflow visibility;

- TV Rights deal: We can plan for how long the current deal is and how much cash we can expect in this time, it renews in 2022. The uncertainty is if there will be a pull back when the new contract comes up
- Commercial/Sponsorship: We can for how long is left on current deals, it gives some cashflow certainty until the next renewals. The expectation would be that we are still a big pulling power and can renew on good terms.
- Match day: Thats where there is no certainty, we have to be budgeting for a big decline here for season 2020/21.

- Player Contracts: Whilst there is cashflow certainty coming in for a period of time, there is also cashflow certainty for a period of time going out. Its the remaining time left on players existing contracts.

The big question is, those players expect renewal with increased wages but if the TV deal is negotiated downwards - then a mismatch creeps in.

- 2020: Much lower get receipts
- 2021: Van Dijk, Henderson, Firmino, Salah and Mane will all have 2 years left on their contracts
- 2022: Terms of new TV deal to be negotiated

Something for the new CEO to think about.

« Last Edit: July 31, 2020, 12:07:09 PM by Rory Fitzgerald »

Offline royhendo

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Re: Liverpool’s financial statements over 10 years
« Reply #12 on: July 31, 2020, 12:04:35 PM »
Very helpful this mate, ta.
Thoroughly mediocre player.

Regrettably not seen anything in him. Neither for us nor from watching lots of youtube videos after a few on here said he looked good.

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Re: Liverpool’s financial statements over 10 years
« Reply #13 on: July 31, 2020, 12:13:24 PM »
Is there a reason the wage costs are missing the tax and pension costs too? In last accounts the total wage costs (inc these) were £309,917,000 rather than £276,197,000 as in the table.

Online Rory Fitzgerald

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Re: Liverpool’s financial statements over 10 years
« Reply #14 on: July 31, 2020, 12:20:18 PM »
Is there a reason the wage costs are missing the tax and pension costs too? In last accounts the total wage costs (inc these) were £309,917,000 rather than £276,197,000 as in the table.

Spot on, you're right. I didn't include the social security and pension costs in that table.
The figures were £23.4m in 2017, £30.9m in 2018 and £33.7m in 2019.

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Re: Liverpool’s financial statements over 10 years
« Reply #15 on: July 31, 2020, 01:15:17 PM »
Spot on, you're right. I didn't include the social security and pension costs in that table.
The figures were £23.4m in 2017, £30.9m in 2018 and £33.7m in 2019.

Removed my post as didn’t see your correction here.
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Re: Liverpool’s financial statements over 10 years
« Reply #16 on: August 2, 2020, 01:28:20 AM »
If you ask me, this is the time to be investing in the next great players. There is likely to be access to quality young players that ordinarily wouldn’t be on the market and at discount prices. As a club we are in a position to do this and we could set up the next title run when the likes of Henderson, Firmino, Salah etc are gone.
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Re: Liverpool’s financial statements over 10 years
« Reply #17 on: August 2, 2020, 01:45:42 PM »
If you ask me, this is the time to be investing in the next great players. There is likely to be access to quality young players that ordinarily wouldn’t be on the market and at discount prices. As a club we are in a position to do this and we could set up the next title run when the likes of Henderson, Firmino, Salah etc are gone.
I think I know what you meant to say, about a title winning squad for the future, but my idea of the next title run is next season. I want to preserve the core of our first 14 as much as possible for as long as possible. There could easily be 3 successful title and CL campaigns in this group of players as they are right now. I know I should be less worried about losing players with the position we are in, but getting through the transfer window without losing key figures is a triumph for any club these days.
« Last Edit: August 2, 2020, 01:49:03 PM by markedasred »
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Re: Liverpool’s financial statements over 10 years
« Reply #18 on: August 2, 2020, 02:00:16 PM »
If you ask me, this is the time to be investing in the next great players. There is likely to be access to quality young players that ordinarily wouldn’t be on the market and at discount prices. As a club we are in a position to do this and we could set up the next title run when the likes of Henderson, Firmino, Salah etc are gone.

Are you talking players aged 16-20 ish? We do appear to be doing this, as well as looking to bring our own local talent through.

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Re: Liverpool’s financial statements over 10 years
« Reply #19 on: August 2, 2020, 03:20:48 PM »
Very helpful this mate, ta.

Absolutely.




















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Offline royhendo

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Re: Liverpool’s financial statements over 10 years
« Reply #20 on: August 8, 2020, 11:40:58 PM »
I’m one word, Chops: “wages”.

PS don’t pretend you’re thick, you tart.
Thoroughly mediocre player.

Regrettably not seen anything in him. Neither for us nor from watching lots of youtube videos after a few on here said he looked good.