ToffeeWeb Viewpoint
Thoughts from the Editor

Searching for the truth
30 April 2005

We recently received this critique from a reader going by the name of Royal Blue Toffee:

First of all, may I congratulate ToffeeWeb and its contributors as one of the most informative sources of useful and up-to-date info on Everton.  However, while I’m not ‘scared’ of bad news or the ‘reality checks’ espoused here, I am a little weary of the occasional manipulation of the facts that can be misleading to the ordinary Evertonian.  One of the most annoying is 'Now, this tripling of Everton's debt under TBH, despite the sale of over £40M's worth of homegrown talent...'.

In order to get anywhere near ‘a tripling of … debt’ I must presume the level of debt it refers to is that from the recently published accounts which were to financial year end May 04.  To refer to this figure and state it is despite receiving £40M is a gross misrepresentation.  The only way to arrive at a value of £40M for home grown talent is to include the Wayne Rooney sale.  This clearly is not included in those accounts figures as it occurred later than May 04.  I would also note that it appears to value Wayne Rooney at £23M (£17M for Dunne, Jeffers and Ball), a figure often ridiculed on ToffeeWeb.

Of course you may have a view that the debt is unchanged or has increased since May 04 despite the sale of Rooney.  I doubt however that that could be substantiated as most other indicators suggest quite the opposite (though admittedly mainly due to the sale of Rooney, an improved league position, increased ticket costs and a reduced squad).

As a second point the statement also conveniently ignores the fact that we have also bought players during that period.  A simple analysis using the transfer dealing figures from the TW’s own pages for the 4 full accounting years under TBH indicates around £44M of purchases against £31M of sales.  This suggests a nett loss of around £13M, not accounting for agents’ fees, loan costs and other levies which, for these sort of figures, would be substantially over £5M.  We can, of course, criticise those purchases though that still doesn’t substantiate inferring that the debt ‘tripling’ is despite receiving £40M.

Don’t misunderstand me I vehemently agree that we should have begun sorting our finances long before now and started recovering these losses.  I’m also sure that you’re fully aware of the inaccuracy of linking the statements in the above remark (similar figures were pointed out as long ago as the EGM which presumably is more accurate?).  My request on behalf of all those searching for the truth about our beloved club is if you want to accuse others of spinning the truth please don’t twist it yourself, you’re better than that… and no, I’m not a Bill Kenwright supporter, far from it!

Some good points raised there, Royal... or should we call you Blue?   Anyway, taking them in turn:

1. Tripling the debt under True Blue Holdings.  As I understand it, this is a reference to the combined indebtedness of Everton FC Co Ltd, as revealed in the financial statements contained in the company's Annual Reports over the last few years.  Let's start with the level of debt at the end of the Johnson era, when Bill Kenwright gained control.  At that time (December 1999), the level of debt was around £15M.  Moving on to the latest financial statements for the year ending 31 May 2004, and the total borrowings (page 26 of the 04 Annual Report) are £46.972M.  
    
2. Selling over £40M worth of home-grown talent.  A.  

Michael Kenrick

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