Friday 17 November 2017

Liverpool squander £50m on phantom stadium

Chris Bascombe

Liverpool's pursuit of a futuristic 'phantom' arena on Stanley Park cost the club a staggering £50m, the club's accounts have revealed.

Former owners Tom Hicks and George Gillett scrapped an earlier stadium design in favour of an upgraded plan from Dallas-based architects HKS.

On taking control of the club, the Fenway Sports Group were forced to abandon that scheme and revert to the original plan. Accounts published today will show a loss of £49.6m associated with Liverpool's stadium costs, £35m of which is a consequence of writing off the Hicks scheme.

As revealed in January, FSG have now dusted down the earlier design by Manchester-based architects AFL, first released in 2001, but the crippling cost of the previous regime's folly is still being felt. Liverpool say without those expenses, this year's club accounts would show the club is breaking even, with debts reduced by over £200m to around £38m.

Interest payments, which rose to £17m due to severe penalties for failure to repay loans under Hicks and Gillett, have now decreased to £3m a year. FSG bought Liverpool with a desire to reduce wasteful expenditure and increase revenue. In fact, during the first season they spent £131m on new players, although £90m was also received through player sales.

The club's wage bill also rose by £10m, but again the shifting of high-earning deadwood left by previous managers, such as Philip Degen, Emiliano Insua and Milan Jovanovic, has since reduced those expenses.

payments

Liverpool also had to pay out £8.4m in termination payments to former staff, including ex-manager and new England coach Roy Hodgson.

Hodgson received £7m when he was dismissed after six months at Anfield. Lack of Champions League football is costing Liverpool around £20m a season due to dips in media revenue and matchday attendances.

Managing director Ian Ayre pinned the latest figures entirely on the former regime led by his former boss Hicks.

"A big part of that cost was on a particular (stadium) design that the previous owners were keen to develop and that's a whole mix of design costs, planning costs, legal costs, some other administrative costs, and they escalated quickly," said Ayre. "What's important is that fans can take some comfort in the fact that moving forward that certainly isn't the case.

"We have a different design which was the original design, which we have planning permission for and in terms of the design, that's largely done, so there's no additional cost to go to there.

"In terms of other areas that we're looking at, at Anfield, again we've been very prudent and there has been no view the cost will escalate anywhere near that again."

Alongside Liverpool's finance director Philip Nash, also still at Anfield, Ayre was an executive member of the Hicks and Gillett regime, having been appointed by the US pair to the role of commercial director in 2007.

That has not prevented him distancing himself from that tainted era and thriving under the current owners. His role has been elevated since being appointed managing director last season as reward for his success in increasing Liverpool's commercial revenues.

They rose again by 25pc to £77.4m in 2011, a figure which doesn't take into account an imminent £25m-a-year kit sponsorship deal with Warrior Sports, currently a record for a Premier League club.

"There is still a lot to do on the commercial side," said Ayre. "They are good figures and it is good growth and we'll grow again this year.

"But in the five years I've been here, I've always said we were a long, long way behind. And I still feel like we're playing a bit of catch-up. We still have a long way to go, particularly internationally, but it's getting there."

Ayre also spoke of "localisation" of "product" in Jakarta -- not the kind of language manager Kenny Dalglish took to Wembley for his last trip to an FA Cup final with Liverpool in 1986 -- but the overriding impression is that the full results will reveal how FSG do not have the financial munificence to buy Liverpool a place back at the top table.

For now, the complexities of Jakarta, write-downs and 24-hour media management can dissolve away and Dalglish can take Liverpool back to more straightforward times, for a weekend on which he should be celebrated for a quality, not to be underestimated, of knowing what makes his adoptive people happy.

"Every generation at the football club have a story to tell about their travels to cup finals," he says of this weekend. "That never goes amiss. It's important to have those experiences.

"Winning the Carling Cup was important. (The Champions League final in) 2005 was hugely important because that generation never had the stories to tell that their parents had. They got it at Istanbul and what a story to tell that was.

"It's usually the people who aren't in the cup finals who say that (they don't count).

"You can argue that, financially, finishing in the top four and qualifying for the Champions League is more beneficial than winning the FA Cup. But when you go to play in the cup final, you don't think about finance." (© Daily Telegraph, London)

Irish Independent

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