An Alternative View

Mike Fisher 19/08/2015 153comments  |  Jump to last
We live in a country where we are all allowed to have an opinion and more importantly the ability to express it. There is no right or wrong here because the one thing we can probably all agree on is that Everton FC is as tight as a drum when it comes to facts. I don't know what is true when it comes to the well documented failings that some supporters blame squarely on the Everton Board of Directors, and in particular on Bill Kenwright.

What I do know from a life time in business is what works with investors and what doesn't. I also know that investors come in all shapes and sizes and like Forrest Gump quoted about his box of chocolates "You never know what you are going to get"!

The ideal scenario is the 'benevolent benefactor' blessed with billions, a love of the club, and a desire to pump his cash into a dream. If one exists, I think they may well have come forward by now.

The less ideal scenario is every other potential investor out there. By default, investors invest to make money. They look for value and an angle on how they can make an acceptable return. For all the well documented reasons, Everton does not present value as we need a new ground and we still carry debt. No viable angle and so I ask the obvious question: Why would a serious investor want to invest in what we have right now?

Is there no future? you may ask. The key in my previous paragraph is 'right now'. Not ever or in a million years! What we need is value and an angle. Also, an observation: No future investors will touch us with a bargepole unless we are seen to have a loyal, supportive, and engaged fanbase. Sorry, guys, but protests, subversion, and militancy are massive turn-offs for a new investor and perhaps more importantly for the ones already on the Board.

We already have some serious investors on the board so a good question any potential investor might ask is: Why do these guys keep their hands in their pockets? What do they know that we don't? It's a good question because frankly only they know and they are relentlessly quiet. Perhaps they are sitting on A Pandora's Box best kept tightly closed... Or they are simply pissed at being blamed by an unappreciative fanbase.

Let's not forget that the Board of Directors have a significant financial investment in Everton that they firstly do not want to lose and secondly hope to one day make a significant return on. Don't expect anything less as they got involved for the same reason that a new investor would. It's just business to them, apart from Mr Kenwright who is apart from his personal lack of mega cash the perfect owner. I know many will disagree, but if anyone can give me the name of a real alternative, then I will happily revisit my statement. Perhaps they can also give me the winning numbers for the Euro lottery on Friday?

I am not looking to make fun, but seriously when I read about getting rid of the Board and replacing them with a mystery new investor who will invest 400M in a new stadium, replace the manager with a Champions League winner, and give them an unlimited budget for players I chuckle. Especially when the only thing apparently holding us back is Bill's reluctance to sell!

Okay, the current Board are not perfect because I can't deny some of the criticism, especially in regard of some of the poor commercial decisions made. We have not built value and we have not made the most of our heritage, but let's look forward, not back.

I have become very aware of mass negativity with some supporters. It's not pretty and it's not helpful, so please consider if making a noise is really anything more than fanning the flames of despair.

We need a team that can win a trophy, get into Europe, and win the games that really matter. We need to drop the tag of being nearly successful and turn up for the big games. The new wave of football fans in Asia and the USA do not look to support a Grand Old Team... they support winning teams and buy the shirt.

We need a better commercial team to build upon the world audience that the Premier League attracts. These supporters will travel to games, stay in hotels, and spend their money on the experience, but the Grand Old Lady is tired and the facilities are far from appealing. The Board need to find a new stadium with a view to a long-term investment or a short-term sale. At the same time, they need to give serious investigation into a modern infrastructure that can fully support the team.

As supporters, we need to find the strength to take the emotion out of how we feel and go with common sense. Again contentious, but let me pose a question: There will hopefully always be a superstar emerging from the Everton Academy or astute buying from the lower leagues. Today, it is John Stones; two years ago, it was Ross Barkley; and in future... who knows. The emotion says we do not sell, but we are a business and every asset has a value and if another team is prepared to pay over value then commerciality dictates you consider selling and reinvest. Not always, but not never either.

The reality is that the solution for our woes is not easily delivered, but perhaps Board and fans would all sleep more easily knowing there is a plan. A business model for the club, and a team strategy on the pitch that all parties could unite behind with a clear vision for the future. Whether that be with the current Board or new investors, the long-term requirements are the same.

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Paul Turner
1 Posted 20/08/2015 at 04:10:26
Incredibly well-reasoned and articulate article. The conversation needs to be conducted at this level. I haven't read anything from the crowd complaining and demanding a different reality that bothers to be as intelligent and logical as this.
Kevin Thompson
2 Posted 20/08/2015 at 05:52:11
Very good article, the only problem is the board are not going to say how much they have to spend each transfer window as it would push up transfer fees; nor can they say anything about a takeover until it's completed as there are non-disclosure agreements; nor mention anything about a stadium while planning permission is sought as it may affect the application.
Simon Harris
3 Posted 20/08/2015 at 06:18:03
"What we need" is clearly laid out in your article, but the elephant in the room, do you believe the current board can deliver?

I'm all for looking forward, and agree with a lot of what you say but there's no evidence to suggest this board and management team have a coherent, mid - long term commercial strategy that will instill confidence in both us the punters and potential buyers alike.

Talk is cheap!

Anthony Hawkins
4 Posted 20/08/2015 at 06:51:39
It’s a well written article but no. The fan base has been pretty united for long periods of time and accepted the lack of investment from all angles since Kenwright and Co took over.

Very little investment has been done since Kenwright bought out Johnson. To keep quiet and to continue to sit on our hands is to carry on accepting that minimal investment from the board is okay. It’s not.

There’s lots the board could be doing commercially and to sell the club. The board are not looking to sell the club, they’re looking for an investor. No-one is going to throw cash into the club without a return.

Jim Lloyd
5 Posted 20/08/2015 at 07:33:35
Protests didn’t stop a Liverpool buy out, and I don’t think you could find more hard nosed businessmen than those Yanks. It didn’t stop Man City getting rid of Swales either.

The team should do okay, as the current and previous manager have brought in some fine young players and the TV money has gone ballistic but I can’t see us challenging for the top four, let alone having any chance of winning the title.

But really, the concern is not so much how the team will do. It is the fact that we play our football in a ground that holds less than 40,000 and it needs redeveloping. There is little possibility of us getting a new stadium.

If you're a business man and your Chairman was making promises that were broken, lied about the a) stadium at Kirkby, and b) the state of Goodison Park (ie would not pass the safety certificate), c) Cancelled shareholders AGMs, then I would have thought you might consider there may be a case to answer.

As fans, I think Evertonians have been extremely loyal and the reasons there is more and more unrest are the broken dreams and now the deafening silence regarding any sort of business plan for the future of Goodison Park. (I won’t stretch my imagination to even consider the possibility of a new ground.)

Sooner or later, Kenwright will not be able to continue as Chairman. Do you see any possibility whatsoever, that Earl or Woods will have the interest to carry out any form of growth plan? Personally, I doubt it very much.

Jim Jennings
6 Posted 20/08/2015 at 07:52:40
"I am not looking to make fun, but seriously when I read about getting rid of the Board and replacing them with a mystery new investor who will invest £400M in a new stadium, replace the manager with a Champions League winner, and give them an unlimited budget for players, I chuckle."

You must be reading different stuff than me because I don’t remember anyone asking for all that.

John Keating
7 Posted 20/08/2015 at 08:07:14
Mike, I agree with Jim (#6).

I want someone, anyone, in place who will come up with a plan and have the decency to articulate that plan to the extremely loyal and ridiculously patient supporters.

Joe Foster
9 Posted 20/08/2015 at 08:21:46
Jim J, no-one has asked for this mystery £400 mil owner. It’s a made up comment to ridicule any detractors who don’t believe in our board. Sad really.
Eric Myles
10 Posted 20/08/2015 at 08:42:34
Jim #6 & Joe #9, these fans that support BK and voted for Desperation Kirkby would have been ecstatic at getting an £80M cowshed in Kirkby with no transport facilities.

Yet they demand that any new owner spend £300 - 400M on a new stadium????

Phil Walling
11 Posted 20/08/2015 at 08:51:12
Well reasoned arguments, and articulately presented. Just like my consistent criticism of the manager (but everybody's hero since last Saturday!) BK and his Board look to be making hard work of an easy job.

There is an assumption amongst football fans that running a club is easy-peasy and something most of us could do in our sleep. Just look at all the free advice dispensed in these columns -- all of it mysteriously ignored!

I've come to be believe that, for many of the reasons listed, but particularly the need for a new stadium, our club is unsaleable for the present -- even at a give-away price. Without the magical appearance of a sheikh or oligarch, BK & Co are us! All the fly pasts in the world will only serve to show what a larey bunch we are, to be avoided at all costs!

Eric Myles
12 Posted 20/08/2015 at 09:02:02
Phil #11, I agree it's very well written but what does it say besides 'be careful what you wish for', 'don't rock the boat', and 'better the devil you know'?
Eddie Dunn
13 Posted 20/08/2015 at 09:20:01
Interesting Mike, but the big problem is that you are looking at the business side of things. I couldn’t give a fig if some Americans started buying Everton shirts and in the Far East you can buy counterfeit shirts in any market for next to nothing.

Everton, like many clubs have a domestic fan base that is loyal, and for the most part will always stay blue. We love our club, we love the special moments of skill or vision, we remember Neville’s tackle on Ronaldo, we enjoy seeing our manager punch the air.

For the most part, this love is unconditional, but increasingly we see mismanagement and poor value for money and we fear for our future. The club doesn’t need a £400 million new stadium, but the current one redeveloped over a period of time at a much smaller cost, spread in a managed way.

I agree that current board members may be sitting on their hands waiting for a return on their investment, without the individual financial clout or desire to make a difference. Therefore I would suggest that the way forward is an enormous share scheme in which fans can buy into the club. This happens in Germany, where they have competitive league, good attendances and compete for euro honours. Everton are reliant on the TV money, and increased match day revenue with even 30 executive boxes would barely pay a week's wages for a young player.

As for protests putting off investors, well they should know that this isn’t a normal business, as we the disenfranchised fans want to have a say. Sky only like fans because they make noise to make their TV product more appealing. They really care about their armchair fans, who are funding the whole inflated money-go-round.

So sorry, Mike, if it is inconvenient, but we are part of the football world and we want more say. The only hope we have is to develop our youngsters, hold on to our best players and manage our resources properly with a plan for the future. In fairness, the club are doing some of these things, but games are still too dear, and the facilities are degrading.

I don’t care about us being on the global tourist trade, with a host of rich people taking seats from real fans -- they can all stick to Formula One or any of the major tennis or golf tournaments, or better still. they can go to Anfield and mix with all of the other glory-hunters. Everton, at a revamped Goodison, with more fan involvement, and a range of ticket prices please.

Ognjen Mojovic
14 Posted 20/08/2015 at 10:24:53
I just hope that this protests don’t bring more damage than good. The last thing the club need is a frenetic and disruptive manner of conducting fan’s demand for a better tomorrow. God, why do I still care about this game at all?! :)
Dick Fearon
15 Posted 20/08/2015 at 10:46:51
I agree with JL @ 5; Supporter protests that included entire pages of paid ads in regional newspapers, a directors son physically assaulted in the Sandon pub, aerial signwriting plus rallies with thousands of marchers.

Also, there were protest CDs distributed and radio talk back hosts overwhelmed by anti Gillett and Hicks calls. T shirts were printed, banners paraded and in ground demonstrations. All of that did not deter Fenway sports in its push to take over the RS. This was despite taking on a 300 million pound debt and a threat of a multi million G&H law suit.

Fenway was also faced with an immediate and expensive need to reinforce certain parts of the structure. On top of that they have made a fantastic start on a massive new stand plus huge landscape improvements in the local area.

Compare that with what we have experienced and judging by the OPs tone will continue to experience while under the current self-serving board.

Martin Mason
16 Posted 20/08/2015 at 10:52:51
Excellent article. The reason that the current board don’t invest is that the club doesn’t make a profit nor pay a dividend so why would anybody invest? All of our revenue goes on buying players, paying their wages and running the club (yes those mysterious other costs). There’s nothing left, we are absolutely maxed out. If we want a ground it has to be retail leveraged with us paying little or something similar, alternatively we have to stop buying players and use the money saved to finance a new ground.

This is the reality of Everton and the fantasy is that we can just find a buyer who’ll keep buying players and finance a ground move or redevelopment of Goodison.

Absolutely correct that nobody will touch us when we have anything but unity.

Trevor Peers
17 Posted 20/08/2015 at 11:00:45
How is it then, Martin, every other Premier League club and even some Championship clubs have managed ground modernization or renewal? Your argument doesn’t make sense and you show a complete lack of ambition for our great club. Shame on you.
Erik Dols
18 Posted 20/08/2015 at 11:00:53
Thanks for the alternative view. To be honest, I do not think it is that well written; because it contains some fallacies. For example, you present an opinion as an observation.

I do agree with Simon Harris #3. What we need is quite clear; we’re missing the boat on the commercial field and for me, BK has proved that under his reign, this is unlikely to change. Your article only makes clear what we need, but ignores the question if BK and friends will be able to deliver that. It even implies that he will, if only us fans would keep quiet!

I find that opinion rather ridiculous and a bit patronizing. BK has had about 15 years to address the commercial issues and the stadium debate, or to find investment. He has done absolutely nothing about it and for that reason we are going backwards. Well run smaller clubs like Swansea are catching up.

The optimistic part of that is that, if new ownership/management would be able to address these issues, we actually can grow and leave the well run smaller clubs behind. I have no faith that BK can deliver that and I find absolutely no argument in your view why he would.

Eric Myles
19 Posted 20/08/2015 at 11:02:07
Martin #16, you say "The reason that the current board don’t invest is that the club doesn’t make a profit."

But didn’t the board trumpet in the last set of accounts RECORD PROFITS of £28M? Are you intimating that they might be lying?

Martin Mason
20 Posted 20/08/2015 at 11:23:50
Trevor, it’s an absolute myth that every other Premier League Club and some Championship clubs have renewed or significantly modernized, shame on you for spouting that nonsense.

I’m ambitious for the club but like all sensible fans, that is ambitious while understanding the constraints the club is operating under and what will prevent it from immediately meeting the irrational expectations of some fans. Getting Everton back to it’s former eminent position is going to be about hard work by everybody associated with the running of the club and by our great fans in supporting that effort. Unless we find a benefactor, we will likely never achieve it.

Winston Williamson
21 Posted 20/08/2015 at 11:28:24
Most Evertonians I come across just want a board with a plan.

Martin, you offer absolutely no answers, other than to carry on with our decline (and be thankful for it), and then demand that anyone with an opposing view, based on what they have witnessed for 16 years, comes up with the answers.

On another thread I and others have offered (simplified) options the current board could take and your reply was nobody buys Everton shirts. You fail to ask why nobody buys Everton shirts (especially in the US when we have their National hero playing for us).

A plan (other than stagnation and decline) is what the majority of unhappy Evertonians want. A plan.

Kevin Tully
22 Posted 20/08/2015 at 11:36:28
Mike (OP) You are peddling a common misconception that the recent fan unrest is related to the request for a 'billionaire.'

You say; "when I read about getting rid of the Board and replacing them with a mystery new investor who will invest £400M in a new stadium, replace the manager with a Champions League winner, and give them an unlimited budget for players I chuckle. Especially when the only thing apparently holding us back is Bill's reluctance to sell!"

Please point me in the direction of this straw man you & the mainstream media have constructed, because I don't know anyone who is asking for the benefactor you have so readily made up.

Secondly, as a businessman, I am sure you realise everything is for sale at the right price. What is the true valuation of EFC Mike? How much do the majority shareholder want for their shares? Unless you can answer that, I'm afraid you know as much as the rest of us.

In simple terms, the fanbase are restless because they are sick of the same M.O. every season from this board. Last minute transfers, 20 years without a trophy and a Premier League ground (which is now viewed as one of the worst in the division) left untouched since they took ownership.

Let me take you a little further, future revenues mortgaged (season tickets) and a constant failure to grow the Everton brand - by the time the Chang deal expires, it will have ran for 13 years! Add Kitbag in for 10 years and you are left scratching you head asking if we even have a commercial operation??

Even if we forget about Kings Dock, the Kirkby Fiasco and Everton Place (but why should we?) we are now looking at a fourth failed proposal - Walton Hall Park. Our CEO said; "By late summer, early autumn 2015 we will be submitting a planning application for the whole site." Now it looks like the next pie in the sky scheme is doomed to failure. I'm no expert like you & Martin, Mike, but it sure looks like a pattern of some sort is emerging here.

So, Mike, the next time you are at Goodison Park, pop over the the Winslow, look out onto the main stand with it's rusty exterior and crumbling cladding, then come back here and let us all know we are in good hands and not to worry.


Martin Mason
24 Posted 20/08/2015 at 11:38:24
Eric, please don't be pedantic; investors need consistent and long term profit and dividends to risk the type of "investment" that our club needs. Surely you'll agree that nobody in their right mind would invest in EFC so why should the board?

For Everton to get to the level that the top 4 or 5 are at now they need not only a modern ground but possibly £100 million a year on players. How do you see EFC getting into that position. Did you watch the Singapore debacle against Arsenal? How do you see Everton influencing 50000 Singaporean fans enough to get them to buy merchandise? Oh yes, we can tell them about our 'istory and perhaps we could even drum up some "ambition" that shouold get the money flooding in. We could tell them that in 1992 we were as good as united in terms of trophies, that should do the trick, well, apart from them not having been born then or possibly not even having heard of Everton. Even better, all we need to do is to find a billionaire who'll lose his marbles and do an Abramovich for us. What a stupid board we have in not having the solutions like we do?

I personally support partial fan ownership with fans putting their money where their mouths are, investing in the clubs themselves rather than moan about others not doing it and have a say in the running of the club. Achieving this needs approval from the owners though, the decision is theirs and only theirs. Is this really a difficult concept or am I missing something?

Ernie Baywood
25 Posted 20/08/2015 at 11:41:18
"Everton does not present value as we need a new ground and we still carry debt."

My lifetime might be less than yours but this sentence doesn't stack up.

Value is determined by the cost of investment and the anticipated return on that investment. Investing in a business with potential that is on it's arse would make great sense if the price is right. Just like that run down semi could be a boomer with a bit of a renovation.

Plenty of us see Everton as underperforming. What a great investment opportunity! (If the price is right).

Erik Dols
26 Posted 20/08/2015 at 11:49:36
Martin #24 "Eric, please don't be pedantic; investors need consistent and long term profit and dividends to risk the type of "investment" that our club needs. Surely you'll agree that nobody in their right mind would invest in EFC so why should the board?"

You're being pedantic, not Eric. Investors don't need a history of consistent and long term profit, they just need the outlook of future consistent and long term profit. And surely, I do NOT agree that nobody in their right mind would invest in EFC. I actually think that in concept, Everton present a great business case. With the new tv deals huge cash flows are guaranteed for the next 6 years or so. And with the obvious room for improvement on the commercial side, relatively easy "extra" profit can be found.

There is really only one question investors would ask: will the cost of buying the club and financing that buy-out be offset by those future profits? Or to put it simpler: is the club not too expensive?

To suggest that no one would want to invest is utter nonsense. Investors are always prepared to invest. It's just a matter of price.

Jay Wood
27 Posted 20/08/2015 at 12:07:30
Paul #1

An articulate article, but 'incredibly well-reasoned' it is not, although it will naturally appeal to those who hold similar views.

It would be nice if, as you say, "the conversation needs to be conducted at this level." But then to add "I haven't read anything from the crowd complaining and demanding a different reality that bothers to be as intelligent and logical as this..."

Really, Paul?

To that I can only say if you believe that you have not made a close study of TW and other fan sites which have presented many substantial, articulate articles offering an alternative view to Mike's opening post, well supported with referenced documentary evidence and links.

The same degree of thoroughness to detail is distinctly absent in the spate of emotive articles similar to this one that have emerged in recent days, which essentially say the same thing:

"We're a hopeless basket case ... there's nothing to be done ... accept the 'reality' ..."

Thankfully, there are still some Evertonians who are not prepared to "go gentle into that good night," but rather, "rage, rage against the dying of the light."

Ernie Baywood
28 Posted 20/08/2015 at 12:12:16
Quote from a Daily Mail article some will, cough, enjoy.

"Everton are currently among the top five fastest growing brands in football."

Really? I'm quite a positive person but even I can't match the Mail's outlook.

http://www.dailymail.co.uk/sport/football/article-3203777/Everton-build-golden-generation-club-remain-resolute-keeping-John-Stones-Toffees-clear-plan-success.html

Jim Lloyd
29 Posted 20/08/2015 at 12:29:54
From what the poster is saying and the support from certain quarters, we have a board led by a chairman, who don't believe in investing in our club.

Evidently, our chaiman's 24/7 search for an investor has been bound to fail. If I read the defence of the board right, they don't invest any of the cash as we don't make a profit and won't make a profit no matter what.

I can just imagine our chairman trying to persuade potential investors, withy glossy business plan under his arm, to invest in what is palinly a basket case of a club.

"Hello mate! I'm Bill and have the honour of being the saviour (well, I hope to be) of this crackpot of a club, which I'm not going to invest in, as there's no chance of making lot's of dosh out of it.

But if you've got a few bob £200 million sounds like a nice round sum, we're going to get a nice new stadium that someone else is buying for us in a lovely setting, just outside the City. You can guarantee then, that you'll make bundles of cash."

"My investment?" Er, wot? I ain't putting a penny into the joint a) I've got no money to spare and b) It won't give me a ready steady go profit for decades to come." Me mate? well, yeah, he's got a few bob but you don't think he's going to waste his dosh do yer?No profits no investy, mate. I think he's a Spurs supporter anyway"

"Our good friend Sir Galahad Green? Now listen, he's a good friend to Everton is Sir Galahad. Wot d'yer mean he's a Spurs supporter as well"

Anyway, less about us and wot about you? Are you up for lending us a couple a hundred million and I think I can promise you...well, I think I can keep you regaled with funny stories about the Boys Pen."

"Wot have we put in then? well nothing...were waitng for some silly get to spend some mazuma and then we can flog our shares for big bucks"

Wot! Yer not investing then? mingebag!"

"As for fans putting their money where their mouth is, wqell isn't that a funy old idea. That'll shut the riff raff up. Why didn't I think of that."

I'll give a guess that there are many of the riff raff willing to invest in our club, including me. Get some businessmen in who don't keep prattling on about what can't be done. Let's have some in we can follow, who plan for what can be done.

Eric Myles
30 Posted 20/08/2015 at 12:36:04
Martin #24, " How do you see Everton influencing 50000 Singaporean fans enough to get them to buy merchandise?"

How did the other clubs do it?

Actually having merchandise for sale might be a good start though.

Trevor Peers
31 Posted 20/08/2015 at 12:41:43
Martin 20 ; Only Palace out of the excepted regular top 20 teams haven't had a ground modernization or renewal, or plan to, and they're hardly a regular premiership team. Why would you argue otherwise ?
Martin Mason
32 Posted 20/08/2015 at 13:05:24
Eric, only the top 4 sell merchandise in Asia so other clubs don't really do it.

I can buy Everton merchandise whenever I want so how is it not available for sale?

Trevor, please list the clubs and what significant sums they've spent on their grounds. Everton has a clear choice, they can spend their revenue on the ground or on players or on intermediate options where they spend reduced amounts on each. The same fans scream if we don't spend everything we have on players so what is your preference? How do they spend what they haven't got? You are absolutely wrong if you think that the Everton board is stupid or wouldn't invest if there was an investment case to be made.

Erik, all information on future EPL revenue is in the public domain and still nobody will touch Everton. There's a reason for this.

Winston Williamson
33 Posted 20/08/2015 at 13:12:58
Martin: "You are absolutely wrong if you think that the Everton board is stupid or wouldn't invest if there was an investment case to be made."

Can you substantiate your claim? Offer valid proof of this claim?

Or is it unsubstantiated to suit your ever-desperate argument?

I noticed you only mentioned the Asian market? What about the failure to capitalise on Howard in the US?

Sorry Martin, but the Board are failing the club.

Jim Lloyd
34 Posted 20/08/2015 at 13:27:36
I don't think the fans would scream if money was spent on improving the structure of Goodison Park. Especially if that meany, bigger capacity, better views and better facilities.

If we can't envisage a new stadium then the choice is letting Goodison Park rot, or redeveloping it.

As Ernie Baywood said "just like that run down semi could be a bit of a boomer with a bit of renovation."

Joe Foster
35 Posted 20/08/2015 at 13:27:37
Martin @24 the fans do put their money were their mouth is by going to the games.
Ste Traverse
36 Posted 20/08/2015 at 13:27:51
"No future investors will touch us with a bargepole unless we are seen to have a loyal, supportive, and engaged fanbase. Sorry, guys, but protests, subversion, and militancy are massive turn-offs for a new investor and perhaps more importantly for the ones already on the Board"


What a load of shite.


I hate even mentioning them, but it didn't stop the shite being took over when there was mass protests against the H+G regime over there.

And other unpopular owners have been replaced at other clubs despite fan protests.

Eric Myles
37 Posted 20/08/2015 at 13:28:21
Martin, at the risk of being even more pedantic (by that I assume you mean truthful) the Club have claimed to have made profits in other previous seasons, it is just this season they claim RECORD PROFITS.

Don't all those previous years count as 'consistent and long term profits'???

Erik Dols
38 Posted 20/08/2015 at 13:30:58
"Erik, all information on future EPL revenue is in the public domain and still nobody will touch Everton. There's a reason for this."

Indeed there is a reason for that! I mentioned it in my previous posts. It's the price. You're conveniently ignoring that piece. If the price is right, investors WILL touch Everton, it is as simple as that.

Martin you could be a character from an Orwellian novel or from Atlas Shrugged with the nonspeak you deliver.

Jay Woods
39 Posted 20/08/2015 at 13:37:38
And there was me thinking I was being paranoid in imagining the club has a psyop-cum-propaganda department that gets wheeled out every time the peasants start revolting. Or Martin Mason will do until such a department comes along.
Joe Foster
40 Posted 20/08/2015 at 13:37:42
The OP says name who could take over from our board. This is one of my favourites. It's as if we have to know the names of mega rich people who might want to buy a club. This is the sort of thing the board should know not us.
Eric Myles
41 Posted 20/08/2015 at 13:38:17
Martin #32, "only the top 4 sell merchandise in Asia so other clubs don’t really do it"

Not true. Last season in the friendly in Bangkok, Leicester City, a newly promoted team, were selling merchandise at the game. There was no stall for Everton merchandise despite a lot of local Thai supporters around who would have bought it. Leicester also have their own shop in Bangkok selling merchandise.

Martin Mason
42 Posted 20/08/2015 at 13:47:21
Erik, How do you know what the price is? You don’t. The price thing is just another myth; the board will sell at the right price and they don’t determine the price, the market does. There isn’t a shred of evidence that EFC hasn’t been sold because the price is too high.

Eric, how much merchandise did Leicester sell and what profit do you think they cleared?

Supply doesn’t create demand (have you bought a Leicester shirt?) and as I say, Everton merchandise is easily available for anybody who wants it.

Joe Foster
44 Posted 20/08/2015 at 13:55:12
There's also not a shred of evidence that to show the board are looking to sell.
Erik Dols
45 Posted 20/08/2015 at 14:00:07
And there also isn't a shred of evidence that EFC hasn't been sold because a plane flew over St Mary's last week. You live in some twilight zone where everybody who doesn't agree with you has to come up with hard evidence (and even then you ask for more, you're asking poor Eric to provide the profit of shirt sales Leicester made in Thailand - Seriously?) while you can dodge all questions asked.

But to use your way of speak: Martin, How do you know what the price is? You don't. So why can you say the price thing is just another myth; the board will sell at the right price and they don't determine the price, the market does. There isn't a shred of evidence that EFC hasn't been sold because the price is too high.

BTW, that's a pretty nice contradiction you make there. The board will sell at the right price and the price is set by the market. But the club has not been sold yet! So either the market doesn't set the price or the board will not sell at the right price. Which one is it, Martin?

Martin Mason
47 Posted 20/08/2015 at 14:02:23
Joe, the finding of the DK enquiry was that the club is for sale, the board says the club is for sale. The null hypothesis is that it is for sale I think.

Nick, are you trying to censor debate or say that I have no right to state my opinion? Would you like the site to be an echo chamber or a place where balanced views are aired?

Eric Myles
48 Posted 20/08/2015 at 14:03:17
Martin, don't be stupid. Do you think I'm privy to Leicester's sales figures?

But I can tell you one thing for certain, I can tell you exactly how much merchandise Everton sold that day.

Nothing, nada, nowt, zilch, fcuk all.

Eric Myles
49 Posted 20/08/2015 at 14:11:26
Actually Martin, the Club testified at the DK public inquiry that it is NOT for sale.

But of course you know that having read the report?

Nick Page
51 Posted 20/08/2015 at 14:19:09
Martin, you are not debating. You are taking and opposing and obdurate stance to what many/the majority are questioning, namely the total and utter failure of the board to achieve anything that they themselves have set out to achieve WITHOUT the help of increased TV revenues, which nobody of sound mind would have built into a business plan. Anybody could have done what they have and as far as I'm concerned, it's being run as a part time job/hobby and not a business with achievable goals/KPI's etc. Pls state your intentions? Are you employed by the club?
Graham Mockford
52 Posted 20/08/2015 at 14:25:34
Nick

Just because you don't agree with him, doesn't mean Martin should be silenced.

Accusations of being a Kopite are way off the mark and has seen a few on here serve a suspension.

After all if every one agreed with everything it would be a dull forum.

Jay Woods
53 Posted 20/08/2015 at 14:31:46
Of course few want an echo chamber on here. But likewise, we don't want club spin masquerading as alternative viewpoints either - it would be helpful if Martin Mason would confirm or deny any formal association with the club.
Nick Page
54 Posted 20/08/2015 at 14:37:42
Graham, at some point in a debate one of the sides admits in some form to agreeing with the other or at the very least taking their point of view. We have here someone merely playing devils advocate. And there are answers to what most of us want to know but they won't be supplied here. In fact I doubt they will be supplied by our draconian board either because they've had many opportunities to explain themselves and their agenda and yet have actually gone out of their way to prevent dissent amongst the support. With these sort of covert tactics.
Eugene Ruane
55 Posted 20/08/2015 at 14:44:26
I'd like to use TW to announce the following.

I'm prepared to give away my flat and everything I own to the right person.

Just...give it away.

No really, if the right person asks me for everything I own, they can have the lot.

My guess is the right person won't ask me but..you never know.

Oh by the way, on day 10 of the DK inquiry, it was 'revealed' by Elstone - 'as far as I know the club has been for sale to the right bidder since Bill Kenwright took over'

John Daley
56 Posted 20/08/2015 at 14:44:32
"....the finding of the DK enquiry was that the club is for sale."

...and this is the same man who accuses other Evertonians of peddling myths about the club?

Phil Bellis
57 Posted 20/08/2015 at 14:50:42
Martin is on top form today - genius; take a bow, old son
But there’s only so much comic relief I can take in one day. I think I’ll wait til he brings out his Annual at Christmas.
Ben Dyke
58 Posted 20/08/2015 at 14:54:40
We can't go round accusing people and trying to silence debate. That belongs in North Korea lads.

I appreciate what Martin writes even if I disagree. I feel like the current board have let the fans down and the club in some ways but I also think they have done some good things. Is it so hard to see both good and bad. Why are they either saints or devils? They are like the rest of us, somewhere in between!

The current silence from the board is deafening and it also feels like there is an absence of a realistic strategy to go forward commercially, investment wise and with new ground/redevelop Goodison.

They also aren't in the slightest accountable to anyone and that in itself is deeply worrying in any business or organisation.

Are they deviant or do they have ulterior motives like seeking outrageous fortune from their shareholding? I'm not sure we can ever know.

Are they out of ideas, or out of their depth when it comes to strategy and the future? Yes it appears so. Have they sold all the assets and indebted the club to maintain success on the field or to cover up other failings?

I think a measured protest carried out respectfully is well merited but I'm disappointed with how many fellow Evertonians can't even handle alternative opinions here respectfully let alone the debate with the actual owners.

Graham Mockford
59 Posted 20/08/2015 at 14:55:06
Nick

Quick tip that might reduce your blood pressure, don't read his posts if they worry you that much.

Or you could 'agree with him and take his point of view'

Kevin Tully
60 Posted 20/08/2015 at 14:56:33
My advice to others ; Don't feed the troll.
Eric Myles
61 Posted 20/08/2015 at 15:01:03
Eugene #55, that's not what the planning application documents presented at the inquiry said

 "The revised Planning Statement (document 18) released yesterday by Tesco, reveals that if there were investors who had the financial clout to wholly or partly fund any new or redeveloped stadium for Everton Football Club, then those investors would be turned away by the current board;

6.10 A further point that is of relevance to any debate on the options that might be available to the Club to fund a new stadium, is the willingness and abilities of the Club's directors to sell some or all of their interests in the Club in order to attract an investor who or which might have the ability in financial terms to fund a new stadium in its entirety or at the very least fund the shortfall that exists in the context of this proposals. As is pointed out in greater detail in the financial statement document 26), this is not an option as the current directors have no intention of selling any of their interests in the Club."

Nick Page
62 Posted 20/08/2015 at 15:10:03
Ben, good post. Para's 3 and 4 are facts. These need addressing. Para's 5 and 6 are speculation as you point out and obviously open to debate. It's 3/4 I want answered. Then 5/6 might reveal themselves.
Erik Dols
63 Posted 20/08/2015 at 15:25:43
Ben I do understand where you are coming from and I do agree. But I have the idea Martin is not discussing at all; he is just presenting opinions as fact and asking others to stake their claims by evidence.
Jim Lloyd
64 Posted 20/08/2015 at 15:28:27
Ben,

There’s a difference between factual statements and opinion. Opinion is fine and everybody’s counts. However, in a topic as important as this one, where it seems that some of the National Press are portraying fans of this club as cynical, misguided, not nice... whatever. Then the reasons that some fans feel it is right to protest, and others don’t are to do with facts as well as giving opinions.

When someone says in part of their argument that the club is for sale and say that the Board says it’s for sale, then that’s a statement, not an opinion.

Another post pointed out the the Board members openly stated at the Kirkby Planning hearing that None of the Directors were prepared to sell any of their shares. If someone keeps on blatantly stating opinions as though they were facts, then it is likely to piss fans off who have quoted their source for their posts.

Opinion is fine and fair enough that we all go the match and have opinions. I agree with you about a measured protest but respectful? To whom?

Now this is purely my opinion but I think that the club has been badly run since True Blue Holdings took control, and probably was before. But at least the previous owner put his own money into the Club. This lot have bought shares and that's it.

I

Tony Draper
65 Posted 20/08/2015 at 15:30:54
Mikes' is an articulate well written, well reasoned and coherent article outlining the points of view of many Evertonians.

Sadly the cruel jibes of our competitors and the commonly held perception in the media quickly summarise what is missing.

"Woodison". No matter how much we love "The Grand Old Lady", she does have false teeth, a dicky hip and won't last forever. Nor should she be made to. The "Blue Rinse" given by BK & Co when they took over has also long since faded. What is required now is considerably more than when they arrived.

"Wipe away all your tears, No trophies for 20 years", that is the undiluted truth. We aren't closer now to correcting that, not even just as a one off in the League Cup.

"Small budget meaning that they have to sell their best", the purchase of Lukaku still has me shaking my head in disbelief, simply because we did shell out £24-8M.

Personally I don't dislike BK, in fact I really like having an Evertonian as Chairman, but he hasn't done what he said that he would do. So like my opinion of DM as manager, I've become bored of our lack of adventure.

There remains much about Everton that most clubs even in the EPL would envy, and that is just how it should be. Sadly there is much about Everton that is not up to Everton standards and that is the only measure which truly counts.

Trevor Peers
66 Posted 20/08/2015 at 15:34:04
Martin, go and have a look at round Anfield if you think I’m crazy thinking there’s no evidence that other clubs are modernizing their grounds.

There’s none so blind as they who will not see? Maybe you should visit Specsavers son.

Patrick Murphy
67 Posted 20/08/2015 at 15:39:49
Troll or not I think Kevin (60) has the right response for Martin. Martin is obviously entitled to his view and by now we all know where his sentiments lie - so there is little point in arguing the points with him because he has closed his mind to any other viewpoint but his own. If however, Martin has some earth-shattering revealation or adds something valuable to the debate then it would be churlish for people not to respond.
Tony Draper
68 Posted 20/08/2015 at 15:42:19
My omission from above.

"Struggling with debt", no we are NOT! This is one oft quoted "fact" which truly makes my piss boil. £28M is literally fuck all in today's game and furthermore there are very few clubs with a smaller debt than us (about 4 as I recall).

The "Daily Mail" (amongst others) produced a financial "what’s what" in March this year based upon financial end of year figures.
Here it is Link

Eugene Ruane
69 Posted 20/08/2015 at 15:44:21
Eric (61) - I know, I remember the contents of document 26 very well as (in black and white) it contradicted the 'of course we're for sale' (to the right bidder!) bullshit completely.

By the way, after the revelation, to my knowledge no one ever said, 'we've changed our mind, cancel that' so to be clear, the club definitely is for sale, even though it...probably isn't.

As for day 10, If anyone was (is!) in any doubt as to the shiftiness and amateurishness of Elstone and those 'in charge' of Everton, they certainly weren't after.

Seriously anyone who could read/hear this and still be saying 'yeah ok they're not perfect but...' needs help imo.

Link

Patrick Murphy
70 Posted 20/08/2015 at 15:52:57
Thanks for the Link Eugene: Interesting isn't it that seven years ago this was stated:

"Mr Lancaster, now in full flow, then suggested that Everton were trying to steal a march over their rivals by getting a bigger stadium, a stadium that they can't afford. He established that no investment had gone into GP in the last thirteen years and that it wouldn't cost that much to improve facilities. He finished off by suggesting to Robert Elstone that if a private business received £52m from a council and then its owners sold up and made an increased profit due to that money, "there would be a public outcry wouldn't there?" "Perhaps," replied the Everton CEO.

And yet the club still proceed with this type of expectation – it might be another 70 years before we are able to find that 'silver bullet'.

Eric Myles
71 Posted 20/08/2015 at 15:53:07
Tony #68, if only our debt really was £28 million, unfortunately it's more than 3 times that.
Kevin Tully
72 Posted 20/08/2015 at 15:54:15
Eugene, I haven't stumbled across that part of the proceedings for some time now. There are actually no words. None.
Tony Draper
73 Posted 20/08/2015 at 16:25:31
Eric @71

The Guardian
Link

Total Sportek
Link

I can't find any more up to date figures, but please share if you have them.

Tony Draper
74 Posted 20/08/2015 at 16:37:31
Ooops, once again I've omitted a link

Everton FC Statement of accounts 2014
(Bottom of page 87)
Link

These figures do seem very consistent with each other, probably because they all emanate from the same source, i.e. the clubs statement of accounts for 2014.

John Keating
75 Posted 20/08/2015 at 16:46:33
Martin (#47),

Can you tell me where in the transcript of the DK inquiry the Board says the Club is for sale?

Michael Winstanley
76 Posted 20/08/2015 at 17:49:40
Eddie Dunn @13.
Brilliant comment.

With all the extra money from TV why aren’t the tickets cheaper?

Martin Mason
77 Posted 20/08/2015 at 17:54:28
Formal association with the club? Get serious will you FFS, is that really the best you can do? I have a right to my point of view and if it doesn't agree with yours then you obviously need to put your case across far better than you are now to convince me otherwise.

The DK public enquiry stated that the club was for sale and I state it as fact, I've posted where it said it several times on this forum already.

Martin Mason
78 Posted 20/08/2015 at 17:56:55
Sorry, I meant to say this is why they were so concerned that Everton could be sold at a much higher value than what it was currently worth on the back of a substantial cash injection by the council.
Anthony Hawkins
79 Posted 20/08/2015 at 18:12:59
BK has since come out to say the club has always been looking for investment, not an outright sale.
Kevin Tully
80 Posted 20/08/2015 at 18:19:37
This has just been posted on Twitter -- make your own minds up.

This document was CONFIRMED as legitimate by Keith Wyness.

Proof Proof Proof etc. pic.twitter.com/kyyHQIUvhS

Jim Lloyd
81 Posted 20/08/2015 at 18:24:06
Kev,

I can't work that out (I know thick git) but are you able to give the gist of it?

Kevin Tully
82 Posted 20/08/2015 at 18:35:40
Jim - copy and paste this : pic.twitter.com/kyyHQIUvhS

You may have to zoom in a bit, but it's supposedly a list of the bidders who wanted to purchase the club. I can't vouch for its authenticity, but going by the past lies, smoke & mirrors, I would bet on it being an authentic document.

John Daley
83 Posted 20/08/2015 at 18:38:07
Jim,

It's supposed to be a list of rejected bidders.

Danny James
84 Posted 20/08/2015 at 18:44:26
As much as I bemoan Bill's lack of dosh. We are turning down the opportunity to make a vast profit on John Stones. The football world seems stunned that a club with our finances keep saying no to bids of £30M+. Southampton would have sold Stones, Barkley and Lukaku by now and banked close on £100M. I believe that Bill would rather have the kudos of having players like this at our club than the money generated from the sales. It may highlight his lack of business acumen but demonstrates the fact he is a Boys Pen graduate.

As much as I would love somebody to come in and invest pots of cash in the club to help us compete, I would be worried any new owner would come in and sell the prized assets to recoup the cash shelled out in buying the club.

Denis Richardson
85 Posted 20/08/2015 at 18:47:18
Tony (#68), there is a big difference between ’debt’ and ’net debt’.

The former is the total amount we owe (as at May’14 that was about £107M), and the latter is what you get when you take the total amount we owe (£107M) less the total amount of assets we have (about £79M, again as at May’14 per the accounts).

So in effect the whole club was worth negative £28M based on just its accounts as at May 2014. (Ignoring the fact the player valuations are not fully reflected in the accounts -- eg, Ross Barkley would be zero as he came through the academy -- and future sky revenues.)

Not saying it’s good or bad, just clarifying as people keep saying we have debt of ’only’ £28M. What we owe 3rd parties is actually much higher than that.

Brent Stephens
86 Posted 20/08/2015 at 18:47:29
Danny, you mean selling assets like Stones?
Jim Lloyd
87 Posted 20/08/2015 at 18:47:38
The copy/ paste worked a treat Kev, thanks. The bloody StartPage said the thing didn’t exist. Anyway, the fight against the machines goes on!

Thanks to you as well, John. Interesting debate and amazing how quickly Everton FC have suddenly got on the back pages and some supportive articles prominent. Now I find that very Iffy!

Nick Page
88 Posted 20/08/2015 at 18:48:25
Wow, that’s some read by Mark Williams @MarkW1878 on Twitter. If all that’s true and there is no reason to doubt it (I guess Mike Lyons could confirm it) it confirms exactly what I’ve believed for the last 10 years. At some point, the little clan obviously realised they were on to a good thing... and the rest is just lie after lie after lie.
Kerry Frahm
90 Posted 20/08/2015 at 19:07:37
Martin, your comments about being able to buy Everton products anywhere is poorly worded.

If you meant "provided you are happy to pay international shipping costs and above average pricing from the club store," then yes, it’s available. Locally, in Australia? No.

I haven’t found any available in any store I’ve been to in Australia for many years and I do know there is a large enough supporter base to warrant it. My local sports store owner can’t even order it from his Umbro rep.

Wow. Hang on. A quick eBay search showed only one current shirt available at $95 starting bid. I'd better jump in quick before there’s an avalanche of bids!

Ged Simpson
91 Posted 20/08/2015 at 19:07:45
Well this has descended in one day to crap debate that as usual involves personal slights. I am sure many are very wise, knowledgeable etc but to most fans it has the relevance of the Labour leadership debate.

That's why an independent assessment may be useful.

John Keating
92 Posted 20/08/2015 at 19:08:57
Martin

I seem to remember Elstone, when questioned, stating Everton was for sale. However, this statement was contrary to the Club's own DTZ report which stated the Club was not for sale.

Elstone made a real arse of himself during the inquiry when questioned though I did have some sympathy for him as he’d not really been long in the job and wasn’t fully up to speed on past happenings.

Now had Bill made himself available rather than his lackey Elstone... well, I was going to say we would have got the truth but we know that wouldn’t have been the case.

The Club couldn’t get their own lies straight with Tesco’

Tony Draper
93 Posted 20/08/2015 at 19:09:58
Denis @85 thanks for that clarification, that was what I needed and seems very much to support Eric @71’s comment to me earlier.

Your clarification has me thinking (as I supposed that I would) just how our "Debt" and "Net Debt" sizes up against the rest of the EPL.

What does seem clear from the articles that I have linked to is that, ranked by our income from our commercial activities, we are a complete weed in the EPL. There is fuck-all excuse for this and it’s even less forgiveable from a "Boys Pen Blue".

We would not have tolerated this indolence from a speculative owner, even less reason to tolerate one of our own "fiddling whilst Rome burns".

Eugene Ruane
94 Posted 20/08/2015 at 19:11:06
Martin Mason (77) - 'I have a right to my point of view'

Shchoooooooo (sharp intake of breath)

Have to say, for me, there's nothing more desperate (or revealing) than 'I'M ENTITLED TO ME OPINION!' (from my experience, it usually comes when a flimsy argument starts to fall apart)

Ffs, of course people are entitled to their 'point of view'

Prefer a 4-4-2 to a 4-5-1?

That's your point of view and you're of course entitled to express it! (and on that I'd agree with you).

Opinion is something we can (and do) argue and debate endlessly

But what people (appear to) think no one is entitled to spinning the facts.

There is a difference.

You state - 'The DK public enquiry stated that the club was for sale and I state it as fact'

Yet as Eric pointed out, document 26 stated - 'the current directors have no intention of selling any of their interests in the Club.'

I have to ask, what you understand this to mean?

I also have to ask if you can point to DK documents from Everton (the potential sellers) stating 'this club is for sale'

Are you basing your claim on Elstone's 'evidence' on day 10 of the DK inquiry?

The reality is if a normal person takes away semantics and disingenuous bollocks, it's fucking obvious the club is not for sale in any normal or conventional sense (and if I'm wrong and it is for sale, it's in the hands of some of the worst salesmen who have ever lived).

Martin Mason
95 Posted 20/08/2015 at 19:11:17
The final report of the public enquiry, §5.3.3 states that:

Nevertheless, since 2004 the club, like many, has been for sale."

Andy Crooks
96 Posted 20/08/2015 at 19:19:13
The OP states that serious investors would have no interest in the club. Perhaps, however, I believe that we are not far away. Debate on this site tends to be quite categorized, the team, the coach and finances.

In my view, we are near a position where what happens on the field can drive what happens off. Under the right coach, this may or may not be Martinez, that’s not my point, we are a couple players short of challenging for a Champions League spot. That would be a mighty game changer.

The gradual redevelopment of our stadium could look possible if one qualification led to another. The profile would rise and our perception in the media would alter dramatically. I cannot accept that on and off the pitch we are achieving our maximum. When we do that we can plan and aspire. Addressing, what seems to me to be a lethargy and smugness permeating from the boardroom down, will not cost millions.

We need a plan and a mission. Keeping John Stones should be the start.


John Daley
97 Posted 20/08/2015 at 19:19:29
Martin,

If you're going to go solely off that one little snippet then at least reproduce the rest of it:

Nevertheless, since 2004 the club, like many, has been for sale. Nobody has been appointed to sell the club and to the knowledge of the CEO there is no buyer for the club.

As has been pointed out to you by many people, 'the club is for sale' party line became worthless when it was admitted during proceedings that none of the directors would be willing to dilute, or sell, their shareholdings at that moment in time.

Martin Mason
98 Posted 20/08/2015 at 19:20:07
Eugene@94

The inquiry report stated that the club is for sale. The board have stated clearly that the club is for sale including in discussions with the BU. The null hypothesis is that the club is for sale and it is on you 100% to prove that it isn’t.

Enough of that "not for sale in any normal or conventional sense" waffle too, that’s the type of semantics and disingenuous bollocks that BK would be proud of.

No need to apologise guys on the report bit. Amazing that I’m right sometimes isn’t it?

I have no idea what document 26 is so can’t comment on it.

Danny James
99 Posted 20/08/2015 at 19:20:38
The thing that worries me about new owners especially those who are business minded and aren’t Everton fans is that they may put profits over performance. You can make more profit budgeting for 17th place than 7th.

If I bought a club like Villa (similar size etc) for say £150M, because I am not a Villa fan, it would be tempting sell £150M worth of players, replace them with youth players and have recouped back my money from the cost of buying the club. Then, if the club got relegated, I would sell the club at a huge loss, say £30M but that would be £30M profit because I would have already recouped the money from player sales. I would do this because I don’t give a shit about Villa and would just be happy with the fact I have made £30M.

It's an extreme example but the point I am making is that a new owner if they are not a fan of the club may not feel investing in the club is the best way to improve profit margins. They may downsize on expenditure such as wages and transfers so that income over expenditure is greater and thus more profitable. A club finishing 17th every year can make more money over a club that finishes 7th every year if their expenditure is significantly less.

Martin Mason
100 Posted 20/08/2015 at 19:22:47
Kerry@90

I didn’t say that shirts were available in shops in Australia... only that the merchandise is readily available. Many companies sell only via the internet, it is the efficient and modern way; should EFC be different?

Martin Mason
101 Posted 20/08/2015 at 19:29:46
John@97

The statement is clear, the null hypothesis is that the club is for sale. Really sorry but it's 100% on you to show that it isn't if you wish to make that claim.

The directors not being willing to dilute their shares is nothing to do with selling the club, it's to do with rights issues to raise capital. The directors not willing to sell their shares individually is also very simple, they won't sell individually and they have that right. What is being said is very clear in most cases.

Tony Draper
102 Posted 20/08/2015 at 19:35:54
Martin @100.

Everton FC's commercial income is fucking pathetic, so the answer to your question in regard of shirt sales/merchandise "should EFC be different?", is yes it should and it could easily be far far better.

Jim Lloyd
103 Posted 20/08/2015 at 19:36:28
Well Danny, the Villa owner (not that I’m a high finance feller) seems to have spent a fair old amount of cash on the club. I think where he went awry a bit was on the choice of managers, but in two cases, he had no choice, they left. Wasn’t it Houllier (dicky ticker) and O’Neill.

I think that making a profit will be well worth it, if the "new owner" gave us what the Yanks are giving to Liverpool.

Brent Stephens
104 Posted 20/08/2015 at 19:36:55
Martin #98 "The null hypothesis is that the club is for sale and it is on you 100% to prove that it isn’t."

A null hypothesis states a negative not a positive. You then look for evidence to refute the hypothesis. So I’d suggest the null hypothesis here is that "the club is not for sale" and we then look for evidence to refute that. Over to you, then, Martin.

Martin Mason
105 Posted 20/08/2015 at 19:46:50
Not correct, Brent. A null hypothesis can be any hypothesis, positive or negative. It is a default position, that’s all. Back to you mate.
Ged Simpson
106 Posted 20/08/2015 at 19:49:32
Brent & Martin,

Have sent you last two posts to Private Eye?

Priceless.

Patrick Murphy
107 Posted 20/08/2015 at 19:54:35
I’m completely lost here now, who thinks the club is for sale? Who said it wasn’t for sale? Who knows the truth?

Perfect side-tracking of the issues as Agent Mason muddies the waters, makes himself the centre of attention, and those who wanted to have a decent debate with cold-hard facts are left with a confused and bored readership. Well done!

Martin Mason
108 Posted 20/08/2015 at 19:56:37
Tony, a genuine question. How do Everton sell more merchandise? Surely only success sells merchandise? Could Tranmere become successful by appointing a top marketing man? Of course not, they wouldn't sell anything.

Surely we'll only sell merchandise outside of our own fan base when we become known and we'll do that by becoming successful on the field and attracting top players.

Ged Simpson
109 Posted 20/08/2015 at 19:59:27
Patrick, when is water muddy rather than just cloudy?
Peter McHugh
110 Posted 20/08/2015 at 20:01:12
Sorry, Patrick 107# I know there was a serious debate but I’m with Ged...

The null hypothesis is that this debate is hilarious and it is up to you 100% to show it isn’t. Go on then, I double dare you.

Winston Williamson
111 Posted 20/08/2015 at 20:06:43
Marketing... take Tim Howard and the rest of the team over to the USA Every other summer (especially after a World Cup) ...organise games against top AMERICAN teams.

Have Tim give a few TV interviews plugging the games and stating how wonderful playing for Everton (the People’s Club) is and how great a club we are.

It’ll have a greater impact than playing Walsall, will it not?

David Barks
112 Posted 20/08/2015 at 20:07:34
Martin,

That’s the most nonsensical thing you’ve said so far, and that’s saying something. Does a product only start selling in a market when they’re established? Of course not. They identify markets and target operations in that market to increase brand awareness and recognition.

I can walk into sporting goods stores in the US and see United, Chelsea, Arsenal, of course Liverpool and now City products. I don’t see Everton. This is despite the fact that we’ve had the star of the US national team playing for us for years, with Tim Howards name all over the press during the last World Cup. Did Everton take advantage of this in the US market? Of course not. Even when we had Landon Donovan, you’d think Everton would market themselves in the US, ensuring there were Donovan Everton jerseys available in US stores, commercials being shown on ESPN advertising this fact. But no.

Even walking around Liverpool, store after store is loaded with Liverpool goods, and only a handful of Everton goods, if at all. It’s a joke.

The goal of any business is to increase their consumer base; in Everton’s case, the "fan base". The current management at Everton has failed miserably here. Do you know that Tim Howard is commentating matches for NBC Sports Network in the US? Don’t you think it might be smart for Everton to coordinate with NBC to show some commercials of Tim Howard in action, in an Everton kit, and advertise where US customers could get their Tim Howard or Everton gear?

But we don’t control our merchandise, we signed a terrible deal with Kitbag. Meanwhile Liverpool kits are visible at every LA Galaxy match now that Gerrard is there.

Brent Stephens
113 Posted 20/08/2015 at 20:08:57
Martin, what does "null" mean?
Erik Dols
114 Posted 20/08/2015 at 20:16:43
The first question you ask has been answered with a very practical and good example in this topic already, Martin. You even commented on that answer. Why ask it again?
Patrick Murphy
115 Posted 20/08/2015 at 20:17:25
Pierce said "The circumstances that a hypothesis although it may lead us to expect some facts to be as they are, may in the future lead us to erroneous expectations about other facts - this circumstance, which anybody must have admitted as soon as it is brought home to him, was brought home to scientific men so forcibly, first in astronomy, and then in other sciences, that it, became axiomatical that a hypothesis adopted by abduction could only be adopted on probation, and must be tested" (7:202)

Hypothesis

Brent Stephens
116 Posted 20/08/2015 at 20:20:45
Quite, Patrick. We'll add that one to Private Eye as well! Ged, I was just trying to prick Martin's pomposity. Nothing more than a pompous prick.
Amit Vithlani
117 Posted 20/08/2015 at 20:21:34
Sorry Dennis @ 95, Net Debt is not Debt less Assets. It is Debt less Cash.

There is no such measure as debt less assets (you might be thinking of net assets, which is total assets less total liabilities, where liabilities include debt and for example trade credit).

Net Debt of £28M is not a lot if compared to Everton’s operating profit last year (or indeed if compared to John Stones's potential value). It would be a lot if we posted operating losses and our most valuable asset was worth £5M instead of £40M+.

In my book, Everton’s lack of transfer activity so far is puzzling and can’t be related to a lack of finances. If the Yarmolenko stories are to be believed, it is down to the odd strategy of making purchases late on in the Window. This supposedly coincides with the first tranche of Sky payments but given what appears to be a manageable level of debt not being able to raise some type of bridge financing to fund purchases earlier (until Sky money is received) is an equally curious state of affairs.

Eugene Ruane
118 Posted 20/08/2015 at 20:23:12
Hmmmmmm.

Rubs chin.

Well ok, I'll say it - I now think all this might be a wind-up.

And if it is, given the time and effort involved, it's superb and my cap is doffed.

I've just read a couple of posts back and there is a definite wind-up element of pretending to ignore stuff (that a normal person couldn't miss) which keeps the whole thing..going.

For example, Eric Myles and I both posted the 'shares aren't for sale' info from document 26 (and both quoted the document number)

MM spends three or four paragraphs telling me we are for sale and his last line is - 'I have no idea what document 26 is so can't comment on it'

Naaaaaaaaaarrr, not havin' that!!

On the off chance he's not on a wind-up?

Link

Brent Stephens
119 Posted 20/08/2015 at 20:26:34
Haha - laughed my nuts off, Eugene.
Jim Hardin
120 Posted 20/08/2015 at 20:31:46
As one of the non-domestic fans of Everton, I still am invested in following and supporting the club and do not see protest by fans as being wrong. I will not presume to put myself in the place of long-time fans but will remind people that today’s world requires a view towards attracting and keeping fans everywhere, even those who cannot drive to see the games. This should not mean that their opinions do not count, but obviously, perhaps they should defer to those closer to Goodison on the state of the grounds etc.

Here is what a typical United States follower of the EPL sees or has seen:

Liverpool: building a new stands and renovating.
West Ham: moving to a new stadium.
Man City: New renovations and an entire complex.
Chelsea: plans to expand supposedly underway.
Arsenal: just did a few years back.
Tottenham: New stadium being built right next to the old one.

Stoke, West Ham, Newcastle, Leicester, Tottenham, Swansea: all signing players some of whom we identified as targets per various media sources...

Notice the name left out? Everton. How does this build a brand where, as is the case over here, people are not born Evertonians? The Board, through its lack of a coherent and transparent plan, is turning Everton into a nice provincial club which would be comfortable in the non-conference pyramid or maybe League Two where such ideas won’t kill the club.

What has our Board been doing? The problem is the fans don’t know. Transparency, honesty, and a coherent plan will keep the fans feeling like their voices and dollars matter.

Silence and lack of stated plans (not about individual players as targets but rather stadium development, retail, marketing, etc) makes a fan feel as if he or she is being told to sit down and shut up and go along for the ride after paying the fare. We can all agree we didn’t like it as children when our parents did it to us... and we don’t like it now as fans since no-one likes to be treated that way.

Tony Draper
122 Posted 20/08/2015 at 20:49:19
Martin @108 & earlier: "Surely only success sells merchandise?" No, it doesn’t! Availability to meet demand does.

Unmet demand means that consumers buy elsewhere. And in the world of football, that means turn elsewhere, to the usual suspects.

Everton FC could double our commercial income and still we would be behind the kind of level that we really should be at by now.

Also, to drive home a point. If only success sells more shirts then BK has failed doubly. No success and piss-poor income from commercial activities. Beginning to sound like the very spiral of mediocrity to failure that I am bloody well sick of.

Martin, I’ll repost this link regarding EPL Clubs Finances.
Link

This clearly shows that a number clubs with far smaller fanbase than ours are outperforming us in terms of commercial activity.

Tony Draper
123 Posted 20/08/2015 at 21:06:59
Amit @117.
Thank You.

I’d really appreciate you or any others with knowledge of Accountancy to give the like of me (a Plumber) some insight, or just comments, into the figures given in the link I have based my comments upon.

The reason why I request this is that, despite the likes of Martin and his "hoodwankery", I believe that Everton are a bigger club than other EPL clubs who are outperforming us financially. As a consequence of their better financial performance, I have a sneaking suspicion that eventually one of these "Smart Clubs" will consistently outperform Everton FC in the EPL.

Martin Mason
124 Posted 20/08/2015 at 21:19:06
Tony, the Link you provided doesn't show anything clearly, you need to explain why it does what you think it does.

I completely disagree, in terms of soccer shirts, that supply increases demand. You wanna buy a few thousand Tranmere shirts?

Martin Mason
125 Posted 20/08/2015 at 21:19:57
Trevor/Eugene, I accept your white flags. Thanks.
Tony Draper
128 Posted 20/08/2015 at 21:40:55
Martin @Troll HQ.

Your words were "Surely only success sells merchandise?".
Not if the punters can't buy them Martin.
Let me repeat that.
Not if the punters can't buy them Martin.

Mr Martin Underbridge, it is time to scuffle off back into your cave near the raging river and practice your hoodwankery elsewhere.

Peter Lee
129 Posted 20/08/2015 at 21:53:03
Everton have issued 35,000 shares. Anyone who wants to put their money where their mouth is can buy one for about £1,350 plus commission. Paying for a match ticket isn't putting your money where your mouth is any more than buying a ticket to see The Sound of Music at the Empire is. It's called paying for entertainment.

Simple maths, 35,000 x £1,350 values the club at around £47¼m. This price would take into account any and all debts which a purchaser would take on. Now someone who wished to buy the club would have to pay a premium price but this is unlikely to triple the value of the shares to give the kind of profit people here accuse the board of seeking ultimately.

John Daley
132 Posted 20/08/2015 at 22:23:59
Martin, 

Give it a rest with the whole null-hypothesis bollocks. It’s not applicable to every real world situation and it’s not intended to be used to make a positive claim or assertion anyway. That’s the purview of the alternative hypothesis.

What you’e attempting basically amounts to pseudo science; making a claim, sitting back and waiting for someone to disprove it with proof of a negative or the absence of evidence. Basically an impossible burden. 

If you state that Johnny Dickfingers defo has four pricks and a thumb atop his palm and then set out to prove it using scientific methods, your null hypothesis would be that ’Johnny Dickfingers doesn’t really have dicks for fingers’. The alternative hypothesis would basically be ’Dickfingers by name, Dickfingers by nature’.

To contradict a null-hypothesis requires positive evidence. If you posit the existence of the Loch Ness monster, you can’t claim the null hypothesis to be ’The Loch Ness Monster is real’ and state this has to be taken as fact until someone can prove definitively that he doesn’t exist. It’s a rigged game. It can’t be done. I mean, he could be fucking invisible... like a fat, less technologically, advanced (probably pissed) Scottish version of Predator. Keeping out of the limelight, biding his time, waiting, watching, blending into the background. Bit like Philip Green. No one could prove otherwise.

Your null-hypothesis has to be ’The Loch Ness Monster does not exist’.

So, basically, Brent had it right. Your much vaunted null-hypothesis wouldn’t be ’Everton are for sale’. It would be ’Everton are not for sale’.

Eugene Ruane
133 Posted 20/08/2015 at 22:25:12
Martin Mason (125) - ’Trevor/Eugene, I accept your white flags. Thanks’

No problem, you deserve it, in fact as you can see, I got you a nice big one, so big you can wrap it round yourself.

Link

(Get ready to grab him and bang the needle in - some of them have the strength of 10 men you know.)

Danny Broderick
134 Posted 20/08/2015 at 22:33:46
Martin,

I have got a flat for sale in Old Swan. It definitely is for sale, so you can buy it if you want. I’ve had it for 16 years. I love that flat, and I’m the best salesman you can get for that flat. I won’t release the price of the flat publicly. But if you are interested, drop me a line. I’ll make you sign a confidentiality agreement, so no-one will ever know if there has been interest or not. But off the record, I’m looking for £750,000 for that little gem of a 2 bedroom flat.

I don’t understand why somebody hasn’t snapped it up previously. My mates in the Press will all tell you it’s as good a flat as you’ll see, and it’s lucky to have had an owner like me these last 16 years.

If we can’t come to an agreement, I’ll just carry on with my long term plan for that flat which is... err... nothing. I think I’ll just hang on to it, as I’m sure there’ll be a big pay day soon.

The neighbours have been getting restless. They say I should spend some money on the flat, but are they blind? Can’t they see that I bought new curtains for the windows? Admittedly I sold off the washing machine to pay for them. But we now do our washing in a state-of-the-art launderette at the bottom of the road.

Sound familiar?!

Patrick Murphy
135 Posted 20/08/2015 at 22:56:59
Danny (134) Before MM gets his hands on your flat, I'm very very interested, I’m sure I can raise the necessary funds by the end of the week. Unfortunately I can’t contact you directly due to lack of internet access or telephone, but if you could drop me a line c/o Greenbacks Bed & Breakfast, 951 Stadium View, Manchester England, please don’t pop round unexpectedly as my landlady is a little bit paranoid about guests having visitors between Breakfast and Tea-time.
Danny Broderick
136 Posted 20/08/2015 at 23:46:19
That sounds familiar also, Patrick! Ha ha!
Denis Richardson
137 Posted 20/08/2015 at 23:52:06
Amit 117 - thanks for pointing that out to me. I was thinking of net liabilities not net debt and couldn’t be bothered to look at the accounts again.

Basic fact is that the total we owed 3rd parties was a damn site more than the £28M net debt figure being banded about. The bonds and the BVI loans combined already total over £40M odd, nevermind the cash we still owe on transfers like Lukaku from Chelsea.

The accounts do need to be taken with a pinch of salt though because the accounting for football clubs is a little odd given as no values are assigned to players that come through the academies. So the likes of Barkley, Osman, Hibbert, Browning, etc all have zero value according to the financial statements -- which is obviously nonsense in the case of the younger ones.

Jim Lloyd
138 Posted 20/08/2015 at 00:09:24
Silly me, Peter, but are you saying that the Board only want £48M for the club?

Funnily enough, I was thinking of buying a share in our club and at roughly £1,500, I could just about do it. That would only leave 34,000 and a few, to collect.

Now Bill, being a Blue through and through, Boys Pen officianado, like meself. Surely he wouldn’t want to make a profit from the club he loves, so the £9M that Gregg lent him should see him rolling in clover: And be a good all round guy to all the Blues in all the world.

Now the only trouble I can see in buying a share, and I’m still tempted to do so, is attending a shareholders meeting (if they’re still allowed) and listening to the unmitigated bollocks from the regime in charge.

I think there are plenty of Blues willing to put into the club, whether it is blokes with lots of cash or whether it’s the widow with her mite.

Peter Lee
139 Posted 21/08/2015 at 00:38:18
Jim,

No idea how much the board members want for their shares nor whether they are minded to sell. In those areas I know as much as anyone else. Nothing.

The share price and the number of shares are both public information and give the current value of the club as arrived at by what individuals are prepared to pay not what people speculate as what might be asked. As I said a purchaser would pay a premium but not 3 times the value I would suggest. But I can’t know that.

Shareholders AGMs were re-instated two years ago following expressions of dissatisfaction from small shareholders. I attended the first and if you buy a share you can go to the next one. If you know a shareholder you might persuade them to give you their proxy and you can attend for free. You would then be in a position to form an opinion on what was said. You would also be able to ask questions.

The meeting two years ago was well-attended and held in the Philharmonic Hall. Many people were disgruntled prior to the meeting but following the presentation of the accounts which dealt in detail with many of the questions repeatedly raised in this forum there were very few questions asked, one angry statement by one chap that didn’t make much sense and that was it.

I didn’t go last time, perhaps someone who did can give us an account. I will be there this time, I hope.

Andy Crooks
140 Posted 21/08/2015 at 00:39:15
Martin, I don’t believe you are deliberately winding anyone up. I think if you were in any way representing the board, — I don’t, by the way, and I think your criticism of Martinez shows this.

However, I think you are putting winning the debate above debating. I have seen some good counter arguments to yours, well actually some facts, that you choose to dismiss. Standing against the majority is often admirable, but sometimes it's plain wrong.

Eric Myles
141 Posted 21/08/2015 at 03:49:22
Tony #74, it seems that you don’t know the difference between debt and net debt.

I’ll plagiarise Denis Richardson’s excellent explanation but change it slightly.

You owe the bank £1,000, your total debt is £1,000 but your mate owes you £300, your net debt is now £700. But you haven’t paid off any of your debt to the bank so your total debt is still £1,000.

That is why the spin of net debt is misleading. As you have the current accounts, which is where I get my up-to-date figures from, you can see yourself that total debt is £107M.

Look at how net debt is calculated, it includes £31M we are owed by others (ie, that we don’t have) and £18M cash that we have in the bank, which was prior to us giving Chelsea £9.5M for Lukaku.

Let me ask you a question, you know we have securitised loans right? (That’s not the question...) Well one of them is for around £22M, the Man from the Pru loan which is reducing every year, and the other around £21M, the Vibrac loan which increased by £7M from the previous year.

With £43M being owed in securitised loans how can you possibly believe that our debt is £25M??? (That was the question.)

Eric Myles
142 Posted 21/08/2015 at 04:10:18
Winston #111, you should add:

And take truckloads of shirts to sell on the spot instead of telling all the fans, ’you know how to use the internet don’t you? Go buy it online’

Amit Vithlani
143 Posted 21/08/2015 at 06:38:05
Eric @ 141 Para 3. Again not correct. If your mate owes you money this is a receivable which is an asset. It is not cash (IOUs are not cash).

Net Debt is Gross Debt less cash (or cash equivalents). Your mate’s IOU is not cash unless he has printing press which can crank out pound notes or Gilts.

So. If the club’s Net Debt is for example £5M, all that this figure is simply saying is the club, once it nets off its cash balances against Gross Debt, remains with £5M of indebtedness.

You point out that Gross Debt is the more relevant figure as cash is transient. True, but frankly the Gross Debt figure may be transient too, as the balance sheet is simply a snapshot at one point in time. Furthermore we do not know if the cash balance was subsequently replenished by payments from player sales by Everton which were done on payment plans.

My belief is that given the turnover of the business, its operating profitability, market value of its players, it is not financially constrained to such an extent that the transfer activity has been so limited this summer. And judging by the Yarmolenko stories we do appear to have the capacity to make a big splash.

The reluctance to spend remains a puzzle. Saved wages are probably £1-2M from signing players later. Had the new arrivals been in the starting line up at Watford, and knocked in the winner, the extra 2 points might earn us a higher league placing which would make up for the additional wage.

@ 123 Tony. I will take a look at your link and post some more colour on the finances.

Brent Stephens
144 Posted 21/08/2015 at 09:49:05
Amit, that's useful. Thanks.
Eric Myles
145 Posted 21/08/2015 at 10:14:58
Amit #143, you have better knowledge of accounting practices than me but the net debt figure includes a credit of £31M for "debtors" which to my limited knowledge means people who owe us money? How is this different from people who owe us money in my example?

Yes the accounts are a snapshot of one point in time, but without access to the monthly trial balance figures, it's all we have to go on.

Eric Myles
146 Posted 21/08/2015 at 10:21:10
I should also say Amit that Denis's original explanation provided the example that his aunt gave him £300 which he put under his pillow.

That would give him a net debt of £700 but he would still owe the bank £1,000, so his debt has not reduced.

Amit Vithlani
147 Posted 21/08/2015 at 14:04:43
Eric @ 145, I will take a look at the accounts and the £31M (sadly I get 15 minutes a day to browse ToffeeWeb, even though it is the most enjoyable 15 minutes of my day). However, taking the figure you quoted in your post, if we have £31M of debtors, then absolutely this is the same as your mate’s IOU (ie, a receivable). However, in the same way, you don’t net this off against the gross debt in Everton’s financials to arrive at Net Debt. These £31M of debtors represent claims which may or may not ultimately translate into cash.

To arrive at Net Debt, you have to deduct cash against Gross Debt. Yes, window dressing does occur to leave the most amount of cash and reduce the net debt figure. Consequently, the most reliable way of judging the capacity of a business to purchase assets (such as football players), whether by borrowing or by spending its own cash, is to look at the operating profitability. Typically, you can borrow around 3-4 times against your operating profitability. If your net debt is less than 3-4 times your operating profitability, you have capacity to borrow more to make acquisitions. If your net debt is more than 3-4 times operating profitability, you might still be able to borrow if the bank takes a view that you have lots of saleable assets (for example other football players) who could be cashed in to reduce debt.

With the market value of Everton’s squad, its operating profitability, and apparently limited net debt, the financial capacity to purchase players looks to be there.

You correctly point out that more information is needed beyond the annual accounts (although I am not sure trial balances necessarily by themselves would help – what we need are more detailed notes to the accounts).

For me, what would be really interesting in studying a detailed set of notes to the accounts would be the beneficiaries of these offshore loans. Sometimes, shareholders choose not take out dividends. It is bad PR to do so.

Sometimes, shareholders can choose to form vehicles which take out cash from their businesses by means of providing expensive loans to those businesses, which will service a high interest rate (a type of return, just as dividends are a return).

I am not suggesting for one minutes that I proof that this is happening here. I am just saying sometimes it happens.

Would this constitute a null hypothesis?

Eric Myles
148 Posted 21/08/2015 at 14:17:47
Thanks for your response Amit, take your time if it is limited, it's always refreshing on these pages to get some informed input and I'm always willing to learn from such rare posters.

You say "you might still be able to borrow if the bank takes a view that you have lots of saleable assets (for example other football players) who could be cashed in to reduce debt."

But isn't this position more likely to apply to a company with more tangible assets and loaning money to a football club based on an arbitrary value of a player e.g. £40M for Stones, would be a high risk loan considering he could have a carreer ending injury next Sunday, and surely see the bank manager granting such loan sacked?

Peter Gorman
149 Posted 21/08/2015 at 18:16:52
Eric, just to back you up on a point made much earlier, I was astounded to find when I visited Thailand some years ago that there were more Leicester City shirts available on sale than Everton. Leicester weren’t even in the Premier League at the time and I wondered (though not enough to bother checking) whether or not they were partly owned by some Thai interests or something to account for this. They were even selling them at the airport!

At the time of my visit, our Chang partnership had been ongoing for years but I swear pretty much every Chang themed shirt I spotted was for a local team. Btw, Chang is not actually that popular a drink over there it seems, most locals prefer Singha, but since the Chang brand is everywhere I doubt that makes a difference.

In the case of Thailand, Martin posits that only success attracts fans which in turn makes the sale of merchandise viable. Perhaps, Thai fans may be that fickle but I would like to think the charitable works conducted by Everton with Chang in building villages, sponsoring television shows etc (remember the young Thai lads who got a chance to join the academy) should have opened the door somewhat. The crux really seems, as others have noted, that having the merchandise available might actually make a difference.

Eric Myles
151 Posted 21/08/2015 at 18:52:17
Peter #149, you say "The crux really seems, as others have noted, that having the merchandise available might actually make a difference."

That is right because despite having Leicester shirts available in Bangkok there were lots of people buying them, and other merchandise, at the friendly game.

Whereas we had absolutely no merchandise available and so sold nothing.

Martin Mason
152 Posted 21/08/2015 at 21:07:23
Amit, glad to see that were in agreement, Eric'll catch up don't worry.

Looks like the board are coming up trumps on new players before the window closes too?

Dave Abrahams
153 Posted 21/08/2015 at 21:18:10
Martin (152) you hope!!! And NO players going out either.
Eric Myles
154 Posted 22/08/2015 at 00:59:26
And just what do you think our operating profit is, Martin?
Jim Lloyd
155 Posted 22/08/2015 at 08:34:34
Well, Peter, I've asked for info from soome stockbrokers about buying one and I'll see how I get on.

I read through quite a few of the Club AGM reports (Michael has a good article on em) and there are some really good ones, especially the reports over the Kirkby Stadium episode.To me, a presentation of accounts is one thing and hopefully, it will give a true reflection of the Club's financial position.

What I'm not convinced I'll hear (if I ever make it to a meeting) is any plan for the improvement of Goodison Park, should the possible move to WHP not materialise.

Eric Myles
156 Posted 22/08/2015 at 11:02:32
By the way Martin #152 we've already established on other threads that you haven't actually read the Club accounts, and don't know the difference between debt and net debt.

Until you do, you'll be the one catching up.

Amit Vithlani
157 Posted 22/08/2015 at 14:17:44
I have looked over the club's 2014 accounts, for the period ended May 2014, which obviously now is a little out of date. As many others have noted, information is very scarce. A few points stick out:

1. According to Note 11 (tangible fixed assets), the club's premises at Goodison Park, equipment and contents, and immaterial amount of residential properties (the club owns residential homes?) were revalued at £12.3m by John Ford & Company back in 1999. If Goodison Park is not owned by the club, what do these club premises represent? If they were last valued in 1999, they must have significantly appreciated in value over the last 16 years.

2. @Eric, the £31m of debtors do not appear to represent anything untoward – they largely represent trade debtors. However, the balance of £28m is rather large relative to the club's turnover, and may represent unpaid portions of players sold. If this is indeed the case, the club was in line to receive large chunks of cash, which would probably be used to settle trade creditor payments of £12.8m (due within 1 year) and £6m (more than 1 year), which one suspects represents payments due from Everton to other clubs for players purchased under an instalment plan.

3. Note 16, Borrowings revealed the overdraft was paid off. What remains are other loans of £48m, made up of £22m under the securitisation loan taken out back in 2002. The remaining £26m of other loans is largely made up of a £21m loan which is secured on the club's broadcast revenues. This loan carries a high interest rate of 9% – puzzling. The use of the proceeds is not specified.

4. The going concern note (Note 1) makes for very interesting reading. The club reported £28m of debt due within 1 year. The note goes into length expressing the Director's confidence that the loans would be renewed (one assumes they have been renewed).

5. @Eric, the 'going concern' note observes that the banks would take "player trading" (ie, the buying and selling of players) into account as a factor for renewing their facilities. This is a clear indication that the banks are lending against potential players sales, to fund acquisitions. Whilst you are right to observe that these player valuations are values of an intangible asset, in an age where you can borrow against a collection of Fine Wines or paintings, one should not be greatly surprised. If the Blues received a written offer of £30m for John Stones, then it is not beyond the realms of possibility that the banks could take this as a reliable indicator of his market value, and lend against this value (although they might apply a discount - to cater for the risk that he might be injured, for example, and see his value diminish).

Furthermore, the 'going concern' note appears to indicate that the renewal of the club's funding was at least partially based on player trading.

6. The accounts are silent on the application of borrowings from other loans. If the other loans, secured on the club's broadcasting revenues, were advanced by shell companies located in tax-free havens, then this needs reviewing. The tax authorities take a dim view of transactions involving opaque companies residing in tax friendly jurisdictions. Financial Institutions these days are avoiding tax dodging wheezes. If the club continues to receive loans from BVI or Cayman denominated entities, then questions may be asked – as no tax-fearing financial institution would participate in such a transaction.

It is not unusual for private individuals to advance companies loans from offshore tax havens. If that is the case here, then one should be concerned as these loans are secured against broadcasting revenues, which is a key lifeblood of the company.

My overall conclusion is that the accounts simply do not provide enough information to get a proper understanding of the club's funding situation. On the face of it, however, given the sizeable operating profit reported, a sizeable operating cash flow, repayment of the bank overdraft, gross debt standing at £48m, the club has some financial muscle to compete in the transfer market (although it would need to borrow against future cash flows to do so, as it does not have liquid sources). This muscle should increase in the next set of accounts given that the club's broadcasting revenues in the season ended were reported to be significantly higher than 2013-14, whilst player values have spiralled upwards.

Two concerns loom over the better financial health of the company: the reliance on opaque offshore funding vehicles, who have a grip on the company's broadcast revenues. And, perhaps linked to this point, the puzzling approach of waiting until August to make purchases in the transfer market. If the club had genuine financial muscle, it should be able to increase its debt on a bridging basis to make acquisitions. Do the loans secured on broadcast revenues prevent further debt being taken on where those broadcast revenues have increased, meaning the club has to wait until it pays down the loans and re-borrow? If so, this is a dangerous and poor arrangement.

Brent Stephens
158 Posted 22/08/2015 at 14:45:19
Amit #157. I'm not a financial specialist but I found that pretty easy to follow. So thanks for that, excellent piece.

"The tax authorities take a dim view of transactions involving opaque companies residing in tax friendly jurisdictions." What's your view on the risk of the authorities unearthing this, if things aren't as they should be? And with what consequences for the parties concerned?

Patrick Murphy
159 Posted 22/08/2015 at 14:56:25
Amit, I think that is exactly what happens regarding waiting to pay off one loan and then taking out another. The Bank overdraft runs from 31/7 to 31/7 and the ’offshore’ loans come up for repayment and renewal in August, presumably after the cheque from Sky arrives.

In real terms, Everton’s transfer window is only open for a month or so, with the odd exceptions such as Cleverley and Deulofeu this year.


Jay Wood
160 Posted 22/08/2015 at 15:01:03
All praise Amit. A clear, concise, but detailed analysis of the last available accounts.

Thank you.

Eric Myles
161 Posted 22/08/2015 at 17:13:57
Thanks, Amit, for taking your limited time to make some enlightening evaluations. I’m just about to go to bed myself as I have to be up early tomorrow to travel home so I will digest what you have said and will raise a couple of questions in a few days.
Tony Draper
162 Posted 22/08/2015 at 00:03:18
Amit, thanks so much for your time and effort. Your comments make for very interesting reading.

Your contribution to the thread is considerable.

Denis Richardson
163 Posted 23/08/2015 at 11:19:24
Jim155 - the clubs stockbrokers are Blackstone Sington in Liverpool.

Current quote for 1 share in EFC is 1,350 pounds (excluding stamp duty and the fees to Blackstone).

They are readily available to buy in (very) small quantities, just not from the directors...

Denis Richardson
164 Posted 23/08/2015 at 11:20:40
Should read 'Blankstone' not blackstone..
Jim Lloyd
165 Posted 23/08/2015 at 11:24:48
Haha, Denis, thought not!

Yep, I've sent them an email and the thing said they'll get back to me soon, which will probably be sometime in the week. I couldn't make head nor tail of the "register" page on the shareholders site.

Excellent piece Amit. Even I understood it...I think.


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