Everton have announced revenue losses amounting to a club-record of £140 million due to the impact of the COVID-19 pandemic.
The English Premier League outfit recorded a deficit after tax of £139.9 million, a figure which has grown larger than the £111.8 million revenue losses announced last season, despite being recorded over a 13-month accounting period.
Everton disclosed that £67.3 million of unexpected losses occurred, caused by the coronavirus pandemic that halted sport across the world and has had devastating financial implications on the industry.
Majority shareholder, Farhad Moshiri, has since pumped in £50 million of his own money to help offset the losses up to June 2020 and has already injected a further £50 million for the current period.
Having assumed control in February 2016, Moshiri has now invested £400 million into Everton in nearly five years at the club, with further investment expected by the end of the season - another £50 million.
As a result of the recent investments made by Moshiri, the club are in the process of proposing a new share issue to Moshiri's Blue Heaven Holdings Limited up to a value of £250 million, with the conversion of previous shareholder loans into equity equating to £150 million of that total. If successfully organised, Moshiri's share in the club could rise from 77.2 per cent to 93.3 per cent.
"Clearly this has been a very challenging year, not least from a financial perspective with the impact of Covid-19 having a profound, wide-reaching and material impact on our figures," said Denise Barrett-Baxendale, Everton chief executive.
"Prior to the pandemic, we were forecasting record revenues in excess of £200m. Our final accounts show that a significant proportion of our losses have been directly attributable to the pandemic.
"However, in this period, it is encouraging that our commercial performance has improved markedly, and this will continue to be a priority moving forward.
"We have also continued our investment into both our new stadium project - which continues to progress in line with our project plan - and, importantly, in strengthening our management and playing staff through the arrival of Carlo Ancelotti and some key additions to our first-team squad.
"These strategically important projects have been enabled by our majority shareholder, who has further underlined his commitment with additional investment into the club, in 2019-20 and into this financial year."
After investment continued from Moshiri, net debt was reduced to £2.3 million, whilst sponsorship, advertising and merchandising revenue of £64 million was more than double what it was for the previous year (£29 million). Total commercial revenue increased to £76 million.
Author: Jake Wilkin