Everton desperately need good news

IF THERE is a club that seems to have the walls closing in on them it is surely Everton, who are not only fighting for their Premier League lives but continue to lose vast sums of money. On top of that, the club has been badly affected by the sanctions on Russian oligarch Alisher Usmanov and, consequently, has a gap in sponsorship income. 

There’s also continued lack of stability on the management front, with Carlo Ancelotti surprisingly leaving at the end of 2020-21 for Real Madrid, Rafa Benitez sacked after just a few months in charge and now former Chelsea manager Frank Lampard presiding over a run of poor results that have pushed Everton to the fringe of the relegation struggle.

Everton’s 2020-21’s financials show a third consecutive £ 100 million-plus pre-tax loss. Although revenues rose by 4% to a record £ 193.1 million, Everton lost £ 120.9 million, admittedly better than 2019-20’s £ 139.8 million and 2018-19’s £ 127.3 million, but still worryingly high. In four years, Everton have lost close to half a billion pounds, but investment made in infrastructure and academy football should help them keep below fair play and sustainability limits.

Everton’s wage bill has caught up with them and despite the big loss, players’ salaries increased by 11% to £ 182.6 million, representing 95% of earnings. In five years, the wage-to-income ratio has gone up from 61% to 95%, and Everton have little to show for their generosity. The club’s last major trophy was won in 1995, 27 years ago and the longest stretch in Everton’s history without a single piece of silverware.

Everton have been among the biggest spenders in the last five years, their gross outlay amounting to £ 483 million, making them the Premier League’s fifth biggest spender. In 2020-21, they had a net spend of £ 62 million, their biggest signings being Allan of Napoli (£ 21.7 million), Abdoulaye Doucouré (Watford £ 20 million) and Ben Godfrey (Norwich £ 20 million). Everton’s record in the market is questionable, witness the write-down of the book value of the squad and the increased provisions for burden-heavy contracts. The club also saw profits on player trading decline from £ 40.5 million to £ 14.8 million.

Despite making a strong start to 2020-21, Everton faded miserably and finished 10th, enduring a dreadful home record in the Premier League. The malaise has continued into 2021-22, the 4-0 thrashing at Crystal Palace in the FA Cup being the latest setback.

The 2020-21 season was characterised by an almost complete lack of fixtures involving spectators, hence Everton’s matchday revenues fell 98% to £ 0.2 million. Only three of the club’s Premier League home games were played before a crowd.  Fortunately, broadcasting bounced back by 49% to £ 146.4 million but the commercial stream was down by 38%. In response to Russia’s invasion of Ukraine, Everton have had to sever all connections with Usmanov’s companies USM, Megafon and Yota. This has cost the club some £ 20 million. The pandemic has been responsible for around £ 170 million of lost earnings although this figure could eventually head north of £ 200 million.

Everton’s net debt went up from £ 2.3 million to £ 58.2 million which was attributed to the investments made in the first team squad and the new stadium. The club has had to be buoyed by a £ 100 million share issue, providing new funds from the major shareholder and since the 2020-21 year-end, another £ 97 million was made available. The club has also secured a five-year facility with Right and Media (£ 90 million drawn), which includes a charge on club assets, and has also taken out a £ 30 million government-backed loan, repayable over three years.

The future revolves around the new Everton stadium at Bramley Moore Dock, but the situation in Ukraine means the original plan to name the ground after Usmanov has been shelved. The club insists its financial position is very secure thanks to stringent cost-cutting and the unwavering support of Farhad Moshiri, but they still has a very heavy cost base. All the more reason to ensure Premier League status is retained for 2022-23 – relegation would surely be a significant blow to their plans.

Rafa Benitez goes, where next for Everton?

IT WAS a marriage of convenience that was doomed from the start, a former Liverpool manager taking over at Goodison Park, a red setting-up camp in the blue zone. “Get out of our club,” almost became a mantra at Everton in recent weeks and it was only a matter of time before the relationship between Rafa Benitez and the club would come to an end.

From scaling the heights at the start of 2020-21 under Carlo Ancelotti, Everton just a season later, are in a relegation battle and they may have to be thankful that there are worse teams in the Premier.

False dawns rise over Goodison every couple of seasons, but it is difficult to see how they can get out of their current mess without taking a long-term view. Everton have lost their way again and the manager’s job is looking anything but attractive in the current circumstances.

Benitez was the wrong appointment on many counts. Firstly, he represents the past rather than the future and given Everton, on and off the pitch, are lagging behind all the top clubs by a distance, they need a dynamic, transformational coach to try and shrink the gulf.

Like José Mourinho, the Benitez style has been overtaken by the Klopp-Conte-Guardiola-Tuchel school. In the early 2000s, his approach worked and he took Liverpool to that dramatic 2005 Champions League success. Since his time at Anfield, his career has increasingly been characterised by short, aborted stints with big name clubs. He was in charge for 22 games at Everton, 25 at Real Madrid and 25 at Inter Milan. His Chelsea role, as an unpopular interim appointment that actually turned out rather well, comprised 48 games. 

His professionalism has always been admired, but will he be in demand now he’s out of a job? Benitez has cited his love of the city and its people to explain his decision to take the Everton job in the first place. Liverpool fans still have a place in their hearts for him and at the Anfield game on the day he was sacked by Everton, the Kop sang his name. A nice touch. 

Everton look absolutely ragged on the field at the moment, one Premier win in 13 games and their latest setback, losing 2-1 at Norwich, underlined the predicament they find themselves in. They are still in the FA Cup and they face Brentford in the fourth round, but relegation is just not worth thinking about.

You have to question the savvy of the Everton board in hiring a former Liverpool man. But equally, are Everton still able to command top, cutting-edge coaches? It would seem not. Carlo Ancelotti suggested they still had it in them, but he didn’t hang around, lured back to Real Madrid. Increasingly, his decision is fully understandable. Bringing in Benitez, a decade ago, would have been a real coup (although still an ex-Liverpool employee), but in 2021, it seemed a little desperate on the part of the club to try and send a message it was still a “player”.

It really isn’t all down to Rafa why Everton are lurching from crisis to crisis. Their transfer market record has been abysmal in recent years, and they’ve spent a lot of money. In 2017-18, their gross spend approached £ 200 million as they tried to deliver a statement of intent. Over the past five years, they have been the fifth highest spender in the Premier with expenditure totalling £ 484 million and net spend £ 220 million. But too many of their signings, such as Davy Klaasen, Theo Walcott and Moise Kean, have been a let-down. 

And yet Everton do have some very good players, they are not in the same category as that other moribund giant, Newcastle United. When you consider they have England’s goalkeeper Jordan Pickford, Richarlison, Dominic Calvert-Lewin, Michael Keane and André Gomes, there’s no shortage of talent when it is fit and working well. 

The club also needs a new director of football after Marcel Brands left in December after three and a half years at Goodison. He looks to have initially carried the can for the current malaise, but now Benitez has followed. 

Who will they find to take over? They would be foolish to install Wayne Rooney or Frank Lampard, the former is not really proven as a coach and the ex-Chelsea midfielder would find it hard to be accepted on Merseyside. There’s talk of Roberto Martinez returning and Brighton’s Graham Potter being on the list of possibles. Duncan Ferguson, who has become Everton’s Ryan Giggs, has been mentioned as a candidate to take the now fashionable interim manager’s role.

Owner Farhad Moshiri took something of a gamble when he appointed Benitez and Everton can ill-afford to make another mistake. More importantly, they need fresh direction to ensure they don’t slip through the trapdoor.