Everton’s Corner : How Long Can David Moyes Save The Financially Crippled Toffees ?

The Blue half of Merseyside will always be indebted to David Moyes as he obstinately guards the downslide of Everton against the pernicious tide of financial tantrums that have grappled the club to a state of defunct business organization.

The club stuck in the vortex of a parlous financial position that neither it can bust nor has the ammunition to move forward. In such a scenario, an organization runs with the ideology of taking minimal looses to the chin, with a hope that their manager will work miracles and the wheel of fortune will rotate again. Moyes is fighting tooth and nail against all odds, but even he can’t change the vicissitudes out of this mesh.

The Savior Of Everton.

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The fans are discontent with things going on at the club. Unlike others, they are not raising slogans against the parsimonious owner, neither citing examples of a knee-jerk reaction demanding the board officials to be sacked. But they want a sophisticated system that harps on operational issues such as improving the revenue channels, reshaping the cost structure and overall appointment of a coterie of business magnets/professional individuals, autonomous, who can expedite the sale of the club. A model inspired by the fellow neighbors, Liverpool when they appointed Martin Broughton to find a potential new buyer for the club.

Chairman Bill Kenwright has failed to attract a new owner who could guide the club to the next level. This stagnation is hurting Everton dearly. Kenwright puts his arms on the shoulder of Moyes, hoping that the Scot will beckon his magic wand season after season. The primary aim is to keep the team challenging at the top end of the Premier League with a shoe-string budget. And then you have to treat Moyes with gentle reverence. He guided Everton to top 10 finish for seven times in 10 seasons, two top five places and a memorable 4th spot in 2004/05. But even he is losing bit of patience now. He got the most out of his resources, sometimes outperforming others who have spent more than him. Now he needs money to improve the squad. The net spend of the club is lower than the three Championship sides promoted this season.

Kenwright regards Moyes as the most important figure at the club and assured him of every penny available, but reality states something different. The Club asserts that they provide Moyes £5.6M every year. So keeping the mathematics simple, that’s £45M in nine years of his tenure. The board broke the club’s transfer record three times from 2006-2008: purchasing Andrew Johnson for £8.6M, Yakubu – £11.25M and Belgian midfielder Marouane Fellaini for £15 million. Since then, he had to sell before any purchase. Everton’s major splurge came through Joleon Lescott’s sale to Manchester City for £22M in the summer of 2009. Moyes knowing that he has to be astute in the transfer market sealed few remarkable deals which others could only think of. He secured the services of Tim Cahill, Mikel Arteta, Phil Jagielka, Steven Pienaar and Seamus Coleman within £10M collectively. Lescott’s money has been well spent on Diniyar Bilyaletdinov £10 million, Johnny Heitinga £6 million and Sylvain Distin £4 million.

Will he find a Buyer?

 

Post 2010, it has been a roller coaster for Moyes. He had to sanction the departures of Pienaar, Arteta, Yakubu, Beckford, and Vaughan since the turn of the year and could only replace with few loan signings, the likes of Real Madrid outcast Royston Drenthe and Argentine striker Denis Stracqualursi. Moyes admitted “It will be really difficult to finish in the top 10.” For a fighter like him fretting on acerbic truths is an appalling view, but at least he can take solace of thwarting the dangers of top clubs buying his potential stars like Jagielka, Fellaini and Baines.

The club only managed a notable profit once in the last eight years, and that was due to Wayne Rooney’s big money transfer to Manchester United in 2004/05. Growth in revenue has been stalled for the last two years while the cost growth doesn’t seem to slow down any time in near future. Selling players at high price earns more profit to the club, but it comes with strings attached. It hampers the performances of the first team. Moreover, apart from Lescott and Rooney, no other signings have earned more than £20M while the importance of player sales is paramount for Everton’s sustainability.

In 2008/09, Everton registered revenue of £79M earning them 8th position in the Premier League income table. But the grim reality is, ‘this’ revenue lags way behind the so-called “the-then” Big Four – (Manchester United £286 million, Arsenal £224 million, Chelsea £201 million and Liverpool £185 million). Imagine, what the scenario would be like when Manchester City and Spurs joining those elite groups in 2010/11 fiscal year. The club suffers from the problem of match day revenues. Goodison Park has a capacity of 40,600, where average attendance is more than 36,000. Hence, their revenue is well short of top earners like Arsenal or Manchester United. You can argue they have a bigger stadium with more sitting capacity. Agreed. But what about Spurs, Chelsea and Liverpool? They have more or less same amount of seats but earn twice the amount through gate receipts. The lack of commercial facilities at Goodison Park can be a reason, though Everton FC has an international profile, a brand image which they have failed to exploit in terms of finance.

Everton’s major income comes from TV revenues. Premier League ensures equal distribution of overseas rights and equal share of 50% of the domestic rights to each and every club. But, 25% of the domestic rights or the facility fees depend upon the number of times a club’s match is broadcasted live, and this is one area that is damping Everton’s spirits. They were shown Live only 13 times in 2009/2010 which is way short than other top PL clubs. Premier League clubs who are in the Champions League gets more coverage than mid-table and bottom clubs. So, what should Everton do in such a bleak scenario? Simple, find a sugar daddy and stabilize the club. As FFP is looming large, it will require more than scatter brained billionaires to invest. But, who is to bell the cat?

Secondly, the need for a new stadium is essential. Liverpool, Chelsea and Spurs – all are willing to change their spiritual home in order to gain a financial mileage. The proposed new stadium sponsored by Tesco at Kirkby site took a dagger blow, when the government rejected the planning application. So, the only way for Everton to get back into some sort of financial stability is claiming the UCL spot, which is more easily said than done.

Kirby Project - The stadium that would have been.

 

Moyes should be supported by funds at least to improve the Finch Farm academy. If the club can introduce more kids into the first team, then they can maintain a healthy wage structure and earn huge profits on sale, a model practiced by Lyon and Porto. Above all they need to keep hold of their star players who can guide them closer to top four, if not the elusive Champions League spot. Without shedding a drop of iota, Moyes’ commitment to the club is unshakeable but if big clubs like Arsenal, United or even Spurs come for his signature can he hold back? Rather, can Everton hold on to Moyes?

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