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Daily Mirror
Daily Mirror
Sport
David Maddock

Everton £120.9m losses show reality about Farhad Moshiri and new stadium funding

Everton have announced losses of £120.9m in their latest accounts - the third year in succession they have reported such a massive deficit.

And that highlights the extent the club currently relies on the backing of billionaire owner Farhad Moshiri, who has twice injected significant amounts of cash into the coffers in the past two years, despite record levels of turnover.

The accounts for the financial year ending June 2021, were released on Tuesday afternoon, and they show significant losses even on turnover of almost £200m, which is the highest in club history. That follows a record loss of almost £140m in 2020 and a further £111.8m in 2019, with losses totalling almost £400m over the past four seasons.

Only a financial injection in the form of two share issues by Moshiri - of £100m in 2020-21, and a further issue of £97m in January of this year - has stabilised the club’s finances, with Everton reporting current net debt of £58m. That rose from £2.8m year on year, and shows the impact of Covid-19 and related issues on the Blues’ finances, with officials calculating the overall cost of the pandemic to be between £170m-£220m.

With debt levels running so high, questions have been asked about Everton’s compliance with the Premier League ’s profit and sustainability regulations, but the club maintain they remain compliant with the rules. Moshiri’s injection of capital has eased fears on that front, despite the rules dictating losses of no more than £105m can be recorded over three years.

The regulations do offer leeway for Covid-related losses and any costs related to infrastructure work, including the build of the stadium, along with the women’s team and community-related work, and Moshiri’s latest injection is set against building work. That allowed the club to suggest, in a statement last night: “The club remains in a secure financial position thanks to the continued unwavering support and commitment (of Mr Moshiri).”

HAVE YOUR SAY! How is Frank Lampard doing as Everton boss? Let us know in the comments section

Everton owner Farhad Moshiri made Frank Lampard his sixth manager in as many years when he was appointed in January (Everton FC via Getty Images)

Moshiri now owns 94.7 per cent of the club after his two share issues, but that comes with the complication of the club suspending ties with chief sponsor - and the owner’s business partner - Alisher Usmanov, and his related companies. Usmanov is principle owner of USM, an official sponsor of Everton Football Club, that had negotiated a £30m fee for first refusal on a naming rights deal for the new stadium.

But in the light of sanctions imposed on the billionaire oligarch by the British government because of his links to Russian president Vladimir Putin following the invasion of Ukraine, Everton withdrew from several contracts with Usmanov’s companies. That has left them searching for new partnerships, and also for funding for the new stadium, though the club remains confident it will be secured.

There are also continuing questions about the source of Moshiri’s wealth, given it in large part is derived from his business links with Usmanov through his USM holding company, with stakes in Russian companies such as mining and steel manufacturer Metalloinvest and wireless communications outfit MegaFon.

There are no suggestions at this stage though, the UK government has any appetite for sanctions on the British-Iranian businessman, who met Usmanov after working as an accountant for companies such as Ernst and Young and Deloitte Touche.

Moshiri resigned from the USM board and his position as chairman of the company, just as sanctions were imposed on Usmanov, and his spokesperson suggested he had sold 50 per cent of his stake in the company, but was prevented from selling the rest by the Russian government.

It leaves Everton searching for different streams of revenue from companies untouched by sanctions, but they remain confident building work on the new stadium on the banks of the Mersey will remain unaffected. Building has continued, and with Moshiri contributing around £100m to costs, the club has indicated they are confident of securing the remaining £350m required through private investors.

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