Whilst loss of such magnitude is never a good thing, Liverpool come a long way since the days of the Tom Hicks and George Gillett ownership, which began to rapidly drain the club’s resources and long-term prospects.
What the Accounts Mean
The club are clearly progressing on the commercial front.
It had long been a stumbling block of the club’s move forward into 21st century football and the club’s commercial arms has been a priority of managing director Ian Ayre’s for some time.
Commercial revenues went up to £97.7 million—a massive £33.8 million increase on the previous year.
Media revenues also went up slightly—£63.8 million from £62.8 million.
Perhaps the most important part of the accounts data though is the club’s owners, Fenway Sports Group’s £46.8 million interest free, inter-company loan which helped the club pay off a stadium debt and reduce overall debts to £45.1 million—down by £19.9 million.
It is a significant move from FSG, pumping their own money into the club to save on spiralling interest payments.
Essentially, John Henry and FSG have put measures in place to plug Liverpool’s financial leak that was brought on by Hicks and Gillett putting their outlay on purchasing the club back on the club’s books.
FSG have stopped the bleeding & hope this will be the last time that Liverpool record a loss. That's a remarkable turnaround since 2010.— Tony Barrett (@TonyBarretTimes) March 4, 2014
Furthermore, Liverpool have not allowed progress in footballing terms to slip whilst tightening up the club’s books. The period of the accounts included a change in manager and the signings of the likes of Joe Allen, Philippe Coutinho and Daniel Sturridge, as well as contract extensions to several first-team players.
What to Expect in the Future
The club’s latest accounts submitted to Companies House this week should be taken with a pinch of salt—they are already almost a year out of date.
When the next set of accounts are published in a year’s time, they will include the recent commercial deals with Dunkin’ Donuts, Garruda Indonesia and Vauxhall.
With hopes that Liverpool will qualify for the Champions League next season, and the media and commercial money that comes with it, Liverpool could be in a very healthy financial position in the foreseeable future—already the financially strongest non-Champions League club in Europe.
A financially sound Liverpool will see the club compete for the best players, invest in a new stadium, and ultimately add to the decorated history at Anfield.
FSG’s approach to managing Liverpool remains level-headed and patient, not making huge promises, but slowly steering the club in the right direction—both on the pitch and off.