2012 EVERTON FOOTBALL CLUB COMPANY LIMITED
Annual Report and Accounts Everton Football Club Company Limited ANNUAL REPORT AND ACCOUNTS2012 2012 AND ADVISORS DIRECTORS CONTENTS, p2 01
01 DIRECTORS AND ADVISORS/p3 02 CHAIRMAN’S STATEMENT/p4 03 FINANCIAL REVIEW/p5 04 COMMERCIAL REVIEW/p7 05 EVERTON IN THE COMMUNITY/p8 06 DIRECTORS’ REPORT/p10 07 INDEPENDENT AUDITOR’S REPORT/p12 08 CONSOLIDATED PROFIT AND LOSS ACCOUNT/p13 09 GROUP BALANCE SHEET/p14 10 COMPANY BALANCE SHEET/p15 11 CONSOLIDATED CASH FLOW STATEMENT/p16 12 NOTES TO THE ACCOUNTS/p17 13 FIRST TEAM RESULTS 2011/12/p30 14 FINAL LEAGUE PLACINGS 2011/12 AND FIXTURES 2012/13/p31 15 HONOURS LIST/p32
Welcome to the Everton Football Club Company Limited Annual Report and Accounts 2012
Directors Registered Office Auditor W Kenwright CBE Chairman Goodison Park Deloitte LLP J V Woods Deputy Chairman Liverpool L4 4EL Chartered Accountants R I Earl & Statutory Auditor Sir P D Carter CBE Company Horton House Registration Number Exchange Flags Chief Executive 36624 Liverpool L2 3PG R Elstone Bankers Company Secretary Barclays Bank PLC M J Evans Liverpool North Group 337/339 Stanley Road Bootle Liverpool L20 3EB
Registrars Capita IRG The Registry Northern House Woodsome Park Fenay Bridge Huddersfield West Yorkshire HD8 0GA
p3 SECTION ONE Everton Football Club Company Limited ANNUAL REPORT AND ACCOUNTS2012 02 run. The highlight of thatcup campaign for mewas appearance infour seasons thanks to afine FA Cup truly spell-bindingaswe also madeathird Wembley and Tottenham Hotspur. Some of ourfootball was swept past teams including Chelsea, Manchester City and 6draws from ourlast 16league games aswe embarked on a superbrunwhichdelivered 8wins From theday thetransfer window closed we during thistime. will. It’s been aprivilegefor meto work alongsidehim Manager. Again Iknow Idon’t have to repeat thisbutI celebrated aswe marked hisfirst ten years asour special relationship we allenjoy withDavid Moyes was effort -for every second thatthey needit. The truly we can doisgive those we trust ourtimeand commitment to common goals, andtheonething Trust can onlybebased onhard work anda that thetransfer window closes. ofpart thisClub’s DNAisto work until thefinal second that –of course Ido. That’s oneof thereasons why that Iamletting himdown because Isimplycan’t do to putbefore him–of course Iwould. DoIfeel attimes he needs. Would Ipersonally like abiggerfinancial pot everything inourpowers, to helphimget thepeople it often, to provide every singlepenny we can, anddo this great football club. David trusts us, andhesays scout andidentify theplayers withtheright DNAfor here –we totally trust David Moyes andhisstaff to breadth of theland,butit’s important to repeat it I know it’s acknowledged throughout thelengthand thing –trust. couldn’t talk, to get onwithourjobs. It’s animportant each other duringtheactual 90minutes whenwe throughout theday right upuntil kick-off, andtrusted couple of new signings. We were involved together magnificent three points, Iwas tryingto get hima questions. Trust. While David was getting usthe And maybe that’s theanswer to allof theabove final day acquisitions. joy of not onlythree terrific points butalso two terrific 1am onFebruary 1st ashedrove homebasking inthe with ourManagertook place between midnight and season. The happiest phone call Ithinkhave ever had completed atransfer window whichtransformed our of Darron Gibson andreturn of LandonDonovan, day arrivals, together withtheslightly earlier signing everything finished smoothly. Those two deadline early hours of thefollowing morningmakingsure by my colleagues atGoodison whoworked into the Pienaar back from Spurs. Acommitment shared Nikica Jelavic from Rangers, andbringingSteven hours hopingto, andfinally succeeding in,bringing still inmy office where Ihadspent theprevious 14 world. Sadly Iwasn’t atGoodison thatnight, Iwas Champions –aclubbelieved to betherichest inthe On thatday we defeated theBarclays Premier League transfer window thisyear. fielded many times since theclose of theJanuary greater wealth thanourselves. It’s aquestion Ihave stunning performance against aclubwithvastly not, thatquestion isasked by rival fans after another of chequebookfuelledfootball? More often than How dowe consistently perform so well inthese days I amoften asked: “How does Everton doit?” 2012 STATEMENT CHAIRMAN’S p4 Bill Kenwright enough for me. My motivation issimple. IamanEvertonian. That’s and Iamaware of thetrust you putinmeto dothat. very best of my ability remains aconstant inmy life My commitment to serve thisfootball clubto the and determined. We willfind majorinvestment. by aglobal economic downturn, we remain positive not diminished.Despite thechallenges presented Institution, withthefinance to move usforward has On afinal note, my desire to find aperson, or improved position thisseason. contributors to ourfiscal well-being are inamuch I amhappy to report thatallthree of these important sales also hadanegative impact onourbottom line. years, whileafall ingate receipts andseason ticket significant reduction inlive TVselections onprevious fromsupport ourbroadcast partners resulted ina confront onaregular basis. Aninexplicable lackof of challenges inadditionto theusualpressures we The last financial year presented uswithanew series Everton intheCommunity. difficulty inmainstream education. OurCity trusts our city who, for whatever reason, have experienced and isalready makingadifference to young peoplein trusted withestablishing The Everton Free School afield. Ourmultiaward-winning charity hasbeen for thebetter, not just inMerseyside butalso further Everton intheCommunity continues to changelives for whichwe remain grateful. PLC, continue to provide uswithlong-term support work andcreativity, andourbankers, Barclays Bank and Kitbag continue to enjoy thebenefits of ourhard- Everton family. Ourlong-standing friendsatChang Dafabet, Paddy Power joiningthe andEASports baseOur partner hasexpanded withNike, StubHub, Evertonians andaffordable football atGoodison. on-going commitment to thenext generation of authorities. Our£95 season ticket reflects our envied by ourrivals andendorsed by thefootball Academy hasdelivered adevelopment programme Our substantial, on-going commitment to our again satisfied withourtransfer activity. That optimism grew over asummerinwhichwe were recent years –whichleaves usquietly optimistic. finished thelast –andinaway thathasevaded usin We have started the2012/13 campaign aswe much not onlyto ourClubbutto football worldwide. world.wider sporting Two terrific menwhobrought so Ablett was felt by ourfootball clubandthroughout the ones -thecruelloss of both GarySpeedand However not allof last season’s memories are happy rain soaked motorway after midnight! And how great itwas to meet so many of you onthe the season. What anight! seeing itrepaid withprobably theperformance of team atSunderland inthequarter final replay and seeing 6,000 fellow Blues putting theirtrust inthe SECTION TWO 2012 FINANCIAL 03 REVIEW
Trading performance Tim Howard, Phil Neville and Ross balance sheet shows a net liability The Group enters into a number On the pitch, the 2011/12 season Barkley, in addition to purchases position of £44.3m (2011: £35.2m). of transactions, relating mainly followed a similar pattern in the January transfer window of However, it should be noted that to player transfers, which create to the season before; a slow Nikica Jelavic and Darron Gibson, the balance sheet contains £9.6m exposure to movements in foreign start followed by outstanding and the loan signings of Steven of deferred income in relation to exchange. The Group monitors this performances in the second Pienaar and Landon Donovan. advance season ticket and lounge foreign exchange exposure on a half of the season. Significant The increased investment in the membership sales which will be continuous basis and will seek to investment in the playing squad playing squad was reflected in released to the profit and loss hedge any significant exposure in the January transfer window wages as a percentage of turnover as games are played during the in its currency receivables and contributed to this strong finish as increasing to 79% although it 2012/13 season hence will not payables. The Group’s policy is well as securing an FA Cup Semi- would be unfair to compare this to require repayment. In addition, to reduce as far as possible the Final appearance at Wembley. other Club ratios without adding £18.7m of borrowings are not interest risk by entering into For the second successive season back estimates of turnover for repayable for more than five years. fixed interest rate borrowings the performances in the Premier outsourced activities. The continual Furthermore it is important to when appropriate. League delivered a 7th place finish, search for operational efficiencies remember that the balance sheet however disappointingly, for the delivered cost savings within the attributes little value to home second successive season, and only business and resulted in other grown players such as the third time in eight seasons, 7th operating expenses falling by Jack Rodwell, Leon Osman, place didn’t secure a place in the £0.9m in the year to £22.7m (2011: Tony Hibbert, Victor Anichebe and UEFA Europa League. £23.6m). Ross Barkley, and to players we have amortised over a period of This pattern of on-pitch As a result of the key factors time such as Baines, Jagielka performances influences our outlined above, we have recorded and Fellaini. financial performance in a number an operating loss for the year of ways including gate receipts, live before player trading of £6.4m In terms of cash flows, the cash TV selections and season ticket (2011: loss of £0.5m). The inclusion outflow from operating activities sales for the following season. of the amortisation of players’ was £7.2m (2011: inflow of £1.9m). Turnover for the year ended 31 registrations of £12.8m (2011: After net payments for interest May 2012 totalled £80.5m (2011: £16.6m), profit on disposal of of £4.0m, net receipts on player £82.0m). Of this turnover, gate player registrations of £14.1m transfers and capital expenditure of receipts generated £16.8m as a (2011: £7.4m) and profit on disposal £10.2m and net cash outflows from result of progressing to the FA Cup of tangible fixed assets of £nil financing of £0.9m, the decrease in Semi-Final, and despite a much- (2011: £8.4m), gives a loss before cash for the year was £1.9m (2011: reduced Premier League average interest and taxation of £5.1m decrease of £3.9m). attendance of 33,209. Our live TV (2011: £1.3m). When we incorporate appearances dropped significantly the net annual interest charge of The Board recognises there are and inexplicably, however, other £4.0m (2011: £4.1m), principally risks which affect the Group increases in TV-based distributions arising from the servicing of the and has sought to minimise ensured income from broadcasting securitised debt and the bank those risks. Our cost base, in remained broadly unchanged overdraft, as well as interest common with other football at £52.8m (2011: £52.9m). receivable, the accounts show a pre clubs, is relatively fixed in the Sponsorship revenue increased tax loss of £9.1m (2011: £5.4m). short-term, hence unfavourable to £7.1m (2011: £6.8m) however movements in revenue, including revenue from other commercial Balance Sheet and Funding those arising from below budget activities fell to £3.0m (2011: Net debt at year end, representing on-pitch performance, can lead to £4.0m) as a result of the prior year borrowings less cash on deposit, significant variation in profits. It is including revenue from the Club’s increased slightly to £46.0m (2011: the aim of the Board to maximise pre-season tour to Australia. £44.9m) however £18.7m (2011: the flexibility of the cost base to £20.0m) is not due for repayment deal with unexpected revenue The continued investment in for more than five years. reductions. Further information on the playing squad included new the Group’s funding requirement is contracts for Marouane Fellaini, As a result of the above trading set out in Note 1. including transfer activity, the
p5 SECTION THREE Everton Football Club Company Limited ANNUAL REPORT AND ACCOUNTS2012 p6 SECTION FOUR 2012 COMMERCIAL 04 REVIEW
BUILDING THE ‘FAMILY’ COMMITMENT TO OFFERING Everton prides itself on acquiring and nurturing VALUE FOR MONEY genuine partnerships and true friendships. Central to Continuing a commitment to make football more developing this is an understanding of our partners’ affordable during these difficult economic times, businesses followed by a commitment to meeting Everton introduced a £5 junior ticket scheme for all objectives. supporters in School Year 11 and under for FA Cup home games in 2012. Over 10,000 young fans, buying Most prominent of our partnerships is the shirt almost 25,000 tickets followed the Blues to Wembley sponsorship deal with Thai Bev through its ‘Chang and prompted the Club to replicate the offer for Beer’ brand, the most lucrative sponsorship deal season ticket holders. We were delighted to sell over in the Club’s history and the longest in the Premier 1,500 £95 season tickets to junior and infant school League. 2011/12 saw the appointment of a UK account supporters for the 2012/13 campaign. manager to further improve our relationship, while the Power of Thai charity campaign at the home game As part of the commitment to value for money, the against Norwich in December raised one million Thai Club also decided to continue the policy of providing baht for victims of flooding. significant discounts to all returning and renewing Season Ticket holders which achieved excellent In tandem with improvements to the existing deal results. In addition, the popular Direct Debit scheme with Kitbag, global sportswear giant Nike became allowing supporters to spread the cost of their Season the Club’s technical partner. As part of the deal, Nike Ticket was extended and proved increasingly popular. provided three new kits for the 2012/13 season and assisted a significant refurbishment of the Everton A successful online push, incorporating social media Two club store in Liverpool One. under the campaign theme of ‘Stand Together’, led to 54% of all Season Ticket sales being processed StubHub, a subsidiary of eBay, and the world’s largest through the Club’s official website, evertonfc.com, secondary ticketing marketplace, also signed a three a 6% increase on the previous year. The online year deal, providing a service which enables Season campaign was supported by a number of offline Ticket holders to re-sell their seat for any match they activities, one of which, ‘Out of the Blue’, saw six are unable to attend. Excluding our shirt sponsorship first-team players appear at various locations across and retail deals, this is now Everton’s largest Merseyside and surprise unsuspecting fans with a free commercial partnership. Trinity Mirror, a renowned Season Ticket for a stand of their choice. nationwide company with a base in Liverpool, became the Club’s new publishing partner. The Club retained over 1,000 corporate members in 2011/12. Additionally, a project to rename and revamp Also coming on board in the summer of 2012 were two of Goodison’s nine hospitality lounges was Paddy Power and Dafabet, who will provide online and completed as the Blues 100 and 1878 Suite became mobile betting facilities in the UK and internationally the ’85 Lounge and 1878 Brasserie respectively. for the next two years alongside Bwin, who will serve the requirements of our supporters attending matches at Goodison.
Other blue-chip partners include ‘high street’ brands Crabbie’s, EA Sports, Thomas Cook and Britannia Building Society (now part of The Cooperative Bank).
p7 SECTION FOUR Everton Football Club Company Limited ANNUAL REPORT AND ACCOUNTS2012 its 25th anniversary.” prepares to celebrate for thecharity asit be even more special 2012/13 season will Community, butthe for Everton inthe ground-breaking year “2011/12 was a 05 London 2012. three athletes whorepresented ParalympicsGB at Football Club. The programme also helpedto prepare the 26 teams whichcurrently represent Everton for afifth consecutive season to helpmaintain Everton’s Disability Programme secured funding with over 3,500 youngsters onMerseyside. 1,250 young peoplepercluband,to date, hasengaged to exceed thePremier League’s goal of working with delivery standards. The Blues’ scheme was thefirst England –anhonourbestowed inrecognition of high strength to strength, receiving a‘Clubmark’ by Sport The Premier League programme 4Sport went from back into theirlocal communities. range of mental health issues to helpthemintegrate helping alarge group of ex-servicemen deal witha Inside Right was launchedinJuly2011 andiscurrently impactful programme. local peopleto continue to access thishugely fund thescheme for two afurther years to enable ‘Imagine Your Goals’ programme andhasagreed to Everton intheCommunity asakey inour partner Mersey Care NHSTrust continues to work with training, employment education. orfurther the arts, to helpget themback ontheir feet andinto of theproject, utilisingeducation, sport,mediaand uptoIt willsupport 150individualsover thefive years their communities. Hands to helpyoung offenders integrate back into to launchaground-breaking programme called Safe over £930,000 from theBig NationalLottery Fund Earlier in2011 Everton intheCommunity was granted personal circumstances. risk of beingexcluded from school dueto challenging 14-19 whodonot currently attend school orare at vulnerable andunderprivilegedyoung peopleaged opened its doors inSeptember 2012 andsupports Another milestone ‘first’. The Everton Free School secure Government approval to openaFree School. became thefirst football club-related organisation to In November 2011, Everton intheCommunity world stage of community development. sports for Everton intheCommunity, firmly establishing itonthe The 2011/12 season was atrulyremarkable andhistoric one 2012 COMMUNITY IN THE EVERTON p8 proud to say ‘that’s my Club’. and, agroup of peoplewhomake allEvertonians fans; oneof thebest ways to reward oursupporters; Club; oneof thebest ways for theClubto listen to its the best ways for Blues fans to get involved withtheir Everton intheCommunity willcontinue to beoneof work andcement its future for many years to come. million to themany support facets of its community awareness andfundraising campaign to raise £2.5 25th anniversary. The charity willembark onaglobal special for thecharity asitprepares to celebrate its Community, butthe2012/13 season willbeeven more 2011/12 was aground-breaking year for Everton inthe Scheme inEurope attheStadium Business Awards. and Recreation Awards andtheBest Community Programme of theYear 2012 attheCommunity Sport awards includingProfessional ClubCommunity remarkable 35 prestigious nationalandinternational of Everton intheCommunity, receiving to date a It hasalso beenayear of recognition for thework • • • • achievements whichalso inthelast year included: The Blues’ official charity isproud of its impressive and theInternational Men’s Health World Congress. Men’s Health, theEuropean College of Science Sports findings presented attheInternational Society of acclaim from themedical world, withtheprogramme’s League Health programme received international Everton intheCommunity’s ground-breaking Premier Delivery of over 35 social programmes challenging areas across Merseyside behaviour anda79% reduction incrime Contributed to a56% reduction inanti-social 1,500 local charities supported 12,500 participants engagedacross allprogrammes SECTION FIVE p9 SECTION FIVE Everton Football Club Company Limited ANNUAL REPORT AND ACCOUNTS2012 06 Sir PDCarter CBE R IEarl associated mediarights. has continued to develop theEverton brand and be thatof aprofessional football club. The Group The principal activity of theGroup continues to previous financial year, were asfollows: Company attheendof thefinancial year, andof the beneficial interests intheshare capital of the The Directors inoffice duringtheyear andtheir J VWoods W Kenwright CBE DIRECTORS POST BALANCE SHEETEVENTS DIVIEN ANTRANSFERS FROM RESERVES REVIEW OFBUSINESS PRINCIPAL ACTIVITY 31st May 2012. statements of thegroup andcompany for theyear ended The Directors present theirreport andtheaudited financial (United Kingdom Accounting Standards and Kingdom Generally Accepted Accounting Practice the financial statements inaccordance withUnited Under thatlaw thedirectors have elected to prepare financial statements for each financial year. Company law requires the directors to prepare accordance withapplicable law andregulations. Annual Report andthefinancial statements in The Directors are responsible for preparing the Directors’ Responsibilities S and thereviews set outonpages 4to 9. the Group are contained intheChairman’s Statement developments, andtherisks anduncertainties facing before player trading, anindication of thelikely future including wages to turnover ratio andoperating profit the Group’s business, key performance indicators 13 of thefinancial statements. Adetailed review of The results of theyear’s trading are shown onpage can befound innote 24 to theaccounts. A description of thematerial aspects of these events of adividend(2011: £nil). The Directors are not ableto recommend thepayment £5.4m), whichhasbeentransferred from reserves. The loss for theyear amounted to £9.1m (2011: loss of
31st May 2012
Number of Shares 2012 9,044 6,622 8,146
714 tatement REPORT DIRECTORS’ p10 31st May 2011 9,044 6,622 8,146
714 Based onongoingdialoguewiththeexisting and same amount, andisrepayable inAugust 2013. the past. This fundingreplaced anexisting loan of the is common industry practice, andasithasdonein the securitisation of future guaranteed revenues, as has obtained fundingpost further year endthrough nature of football clubrevenue streams, theGroup bank loan. Additionally, because of thepredictable requirements through anoverdraft facility anda 1, theGroup meets its day to day working capital business’ cash flow projections. Asdisclosed innote due theDirectors have reviewed indetail the liquid resources to meet its liabilities asthey fall Review, inensuringthattheGroup hassufficient In additionto therisks addressed withintheFinancial Risk anduncertainties other jurisdictions. financial statements may differ from legislationin governing thepreparation anddissemination of Company’s website. Legislation intheUnited Kingdom corporate andfinancial information included on the responsible for themaintenance andintegrity of the of fraud andother irregularities. The Directors are reasonable steps for theprevention anddetection the assets of theCompany andhence for taking 2006. They are also responsible for safeguarding financial statements comply with theCompanies Act of theCompany andenablethemto ensure thatthe reasonable accuracy atany timethefinancial position explain theCompany’s transactions anddisclose with accounting records thatare sufficient to show and The Directors are responsible for keeping adequate • • • • statements, theDirectors are required to: Company for thatperiod.Inpreparing these financial affairs of theCompany andof theprofit orloss of the that they give atrueandfair view of thestate of not approve theaccounts unless they are satisfied applicable law). Under company law the directors must that thecompany willcontinue inbusiness. concern basis unless itisinappropriate to presume prepare thefinancial statements onthegoing statements; and departures disclosed andexplained inthefinancial have beenfollowed, subjectto any material state whether applicable UKAccounting Standards reasonable andprudent; make judgments andaccounting estimates thatare them consistently; select suitable accounting policies andthenapply SECTION SIX potential funders, the Directors are the Directors are confident that the Employment Policies This confirmation is given confident that this facility will be current facilities will be renewed The Group’s employment policies and should be interpreted in replaced by an equivalent facility at a similar level, or replaced by are designed to retain and motivate accordance with the provisions of on repayment. equivalent facilities, for the 2013/14 staff at all levels. Staff are, s418 of the Companies Act 2006. Premier League season. within the bounds of commercial Deloitte have indicated their The Group’s current overdraft confidentiality, kept informed of willingness to be reappointed for facility and bank loan expire on The Group’s trading projections matters that affect the current another term and appropriate 31 July 2013. The timing of the show that it has a reasonable performance and future prospects arrangements have been put expiry of the current facilities on expectation of staying within its of the Group and are of interest to in place for them to be deemed 31 July 2013 allows the Group’s currently available, and future them as employees. reappointed auditor in the absence bankers and the Directors to anticipated, finance facilities, of an Annual General Meeting. agree appropriate facilities for including the overdraft and bank The Group operates an equal the following season based on loan facilities and the available opportunities policy to ensure that Approved by the Board on performance in the 2012/13 agreed securitisation facilities no member of staff or job applicant 18 December 2012 and signed on Premier League season and against future revenues referred receives less favourable treatment its behalf by: reflect activities, including the to above, for at least 12 months on the grounds of gender, race, Group’s player trading activity in from the date of signing of these ethnic origin, age or disability. M J Evans the January 2013 transfer window accounts. In preparing these Company Secretary and the start of the summer 2013 trading projections, a number of Every possible step will be taken transfer window. additional inherent uncertainties to ensure that individuals are have been identified; notably on- treated equally and fairly and that The Directors have worked closely field performance and the resultant decisions on recruitment, selection, with the bank throughout the reduction in the Premier League training, promotion and career year and based on discussions domestic broadcasting merit management are based solely on with the bank believe that it is the award payment and the level of objective and job-related criteria. bank’s current intention to renew player trading. the facility agreements or put in When recruiting and retaining place arrangements to provide The Directors have considered disabled employees, the Group similar facilities for the following the uncertainty surrounding will be guided by the principles season, in each case subject to the renewal of the facilities and and duties set out in the Disability review at the end of the current other inherent uncertainties and, Discrimination Act and its football season with the knowledge in the event that they would be associated Codes of Practice. of the level of player trading over required, have identified a number the period and with the amount of potential mitigating actions to Auditor and terms to be negotiated at the manage any resulting forecast Each of the persons who is a appropriate time. The Directors shortfall against current facilities Director at the date of approval of acknowledge the need for further including the ability within the this report confirms that: discussion and agreement with industry to securitise additional the bank, thereby giving rise to a future guaranteed revenues and • so far as the Director is aware, degree of uncertainty on the final flexibility around player trading. there is no relevant audit outcome regarding bank funding. information of which the However, the Directors consider Based on the mitigating actions Company’s auditor is unaware; discussions with the bank to be referred to above and the comfort and of appropriate comfort to them in obtained from their bankers, • the Director has taken all the the circumstances. In particular, the Directors have a reasonable steps that he ought to have taken the Directors consider it to be expectation that the Group will as a Director in order to make common practice for many Premier have adequate resources to himself aware of any relevant League football clubs for the exact continue in operational existence audit information and to establish level and terms of the facility to for the foreseeable future. that the Company’s auditor is be reviewed at the end of each Accordingly they adopt the going aware of that information. football season. Based on the concern basis in preparing the ongoing dialogue with the bank, Annual Report and Accounts.
p11 SECTION SIX Everton Football Club Company Limited ANNUAL REPORT AND ACCOUNTS2012 the financial statements. In ouropiniontheinformation given intheDirectors’ Report for thefinancial year for which thefinancial statements are prepared isconsistent with Matters onwhichearerequired to report by exception Opinion onother matters prescribed by the C Opinion onfinancialstatements S Board’s Ethical Standards for Auditors. with applicable law andInternational Standards onAuditing (UKandIreland). Those standards require usto comply withtheAuditing Practices for beingsatisfied thatthey give atrueandfair view. Ourresponsibility isto auditandexpress anopiniononthefinancial statements inaccordance As explained more fullyintheDirectors’ Responsibilities Statement, thedirectors are responsible for thepreparation of the financial statements and Respective responsibilities ofd irectorsd au an ditor company’s members asabody, for ourauditwork, for thisreport, orfor theopinionswe have formed. for noother purpose. To thefullest extent permitted by law, we donot accept orassume responsibility to anyone other thanthecompany andthe has beenundertaken so thatwe might state to thecompany’s members those matters we are required to state to theminanauditor’s report and This report ismadesolely to thecompany’s members, asabody, inaccordance withChapter 3of Part 16of theCompanies Act 2006. Ourauditwork applicable law andUnited KingdomAccounting Standards (United KingdomGenerally Accepted Accounting Practice). consolidated cash flow statement andtherelated notes 1to 26. The financial reporting framework thathasbeenappliedintheirpreparation is consolidated profit andloss account, theconsolidated statement of total recognised gainsandlosses, theGroup andCompany balance sheets, the We have audited thefinancial statements of Everton Football ClubCompany Limited for theyear ended31st May 2012 whichcomprise the Indepenent A 07 any apparent material misstatements orinconsistencies we consider theimplications for ourreports. and non-financial information intheannualreport to identify material inconsistencies withtheaudited financial statements. Ifwe become aware of significant accounting estimates madeby thedirectors; andtheoverall presentation of thefinancial statements. Inaddition, we read allthefinancial policies are appropriate to thecompany’s circumstances andhave beenconsistently appliedandadequately disclosed; thereasonableness of financial statements are free from material misstatement, whether caused by fraud orerror. This includes anassessment of: whether theaccounting An auditinvolves obtaining evidence abouttheamounts anddisclosures inthefinancial statements sufficient to give reasonable assurance thatthe • • • In ouropinionthefinancial statements: 18 December 2012 Liverpool, United Kingdom Chartered Accountants andStatutory Auditor for andonbehalfof Deloitte LLP Damian Sanders (Senior Statutory Auditor) • • • • We have nothing to report inrespect of thefollowing matters where theCompanies Act 2006 requires usto report to you if, in our opinion: cope oftheaudit ofthefinancialstatements have beenprepared inaccordance with therequirements of theCompanies Act 2006. have beenproperly prepared inaccordance withUnited KingdomGenerally Accepted Accounting Practice; and give atrueandfair view of thestate of theGroup’s andtheCompany’s affairs asat31st May 2012 andof theGroup’s loss for theyear thenended; we have not received alltheinformation and explanations we require for ouraudit. certain disclosures of directors’ remuneration specified by law are not made;or the financial statements are not inagreement withtheaccounting records andreturns; or adequate accounting records have not beenkept, orreturns adequate for ouraudithave not beenreceived from branches not visited by us;or uditor’s Report to theMembersofEverton F
ompanies A
2012 ct 2006
ootball Club C REPORT AUDITOR’S INDEPENDENT p12
ompany Limited SECTION SEVEN CONSOLIDATED PROFIT AND LOSS 08 ACCOUNT FOR THE YEAR ENDED 31 MAY 2012
2012 2011
Operations excluding Player Total Total player trading trading
Notes £’000 £’000 £’000 £’000
Turnover 1,2 80,531 - 80,531 82,021
Operating expenses 3 (86,933) (12,852) (99,785) (99,170)
Operating loss 4 (6,402) (12,852) (19,254) (17,149)
Profit on disposal of players’ registrations - 14,141 14,141 7,426
Profit on disposal of tangible fixed assets - - - 8,432
(Loss) / profit before interest and taxation (6,402) 1,289 (5,113) (1,291)
Interest receivable and similar income 5 112 13
Interest payable and similar charges 6 (4,105) (4,135)
Loss on ordinary activities before taxation (9,106) (5,413)
Tax on loss on ordinary activities 8 - -
Loss after taxation for the year 19,20 (9,106) (5,413) transferred from reserves
All the above amounts derive from continuing operations.
There are no recognised gains and losses for the year ended 31st May 2012 and the prior year other than as stated in the profit and loss account, accordingly no separate consolidated statement of total recognised gains and losses is given.
p13 SECTION EIGHT Everton Football Club Company Limited ANNUAL REPORT AND ACCOUNTS2012 Director W Kenwright CBE 18 December 2012 andsignedonits behalfby The financial statements of theEverton Football ClubCompany Limited, registered number36624, were approved by theBoard onthe 09 Shareholders’ deficit Profit andloss account -deficit Revaluation reserve Share premium account Called upshare capital Capital andReserves Net Liabilities Provision for liabilities Creditors -Amounts falling dueafter more thanoneyear Total Assets Less Current Liabilities Net Current Liabilities Creditors -Amounts falling duewithinoneyear Investments Debtors Current Assets Tangible Assets Intangible Assets Fixed Assets AT 31 MAY 2012 GROUP BALANCE SHEET p14 Notes 20 10 18 14 19 19 19 16 15 12 17 11 (57,166) 10,823 £’000 8,056 2,767 2012 (46,343) (44,293) (44,293) (16,022) (72,345) 30,321 (27,176) 24,968 (1,095) £’000 23,927 6,394 3,049 SECTION NINE 35 (55,985) 13,868 £’000 2,767 11,101 2011 (32,004) (35,187) (35,187) (63,239) (2,002) (42,117) 24,968 33,328 £’000 40,115 3,049 6,787 (1,181) 35 COMPANY BALANCE SHEET 10 AT 31 MAY 2012
2012 2011
Notes £’000 £’000 £’000 £’000
Fixed Assets
Intangible Assets 10 23,927 33,328
Tangible Assets 11 1,104 1,250
Investments 12 - -
25,031 34,578
Current Assets
Debtors 14 7, 381 10,995
7, 381 10,995
Creditors - Amounts falling due within one year 15 (70,643) (70,682)
Net Current Liabilities (63,262) (59,687)
Total Assets Less Current Liabilities (38,231) (25,109)
Creditors - Amounts falling due after more than one year 16 (3,414) (7,341)
Provision for liabilities 17 (1,095) (1,181)
Net Liabilities (42,740) (33,631)
Capital and Reserves
Called up share capital 18 35 35
Share premium account 19 24,968 24,968
Revaluation reserve 19 1,165 1,165
Profit and loss account - deficit 19 (68,908) (59,799)
Shareholders’ deficit (42,740) (33,631)
The financial statements of the Everton Football Club Company Limited, registered number 36624, were approved by the Board on the 18 December 2012 and signed on its behalf by
W Kenwright CBE Director
p15 SECTION TEN Everton Football Club Company Limited ANNUAL REPORT AND ACCOUNTS2012 11 Interest received Returns oninvestments andservicingof finance Cash (outflow) /inflow from activities opertaing Interest paid Finance lease andhire purchase interest Purchase of tangible fixed assets Purchase of intangible fixed assets Capital expenditure andfinancial investment Taxation and servicingof finance Net cash outflow from returns oninvestments Proceeds from the disposal of tangible fixed assets Proceeds from the disposal of intangible fixed assets New loans Financing Net cash outflow before financing and financial investment Net cash inflow from capital expenditure Repayment of loans Capital element of finance lease andhire purchase payments Decrease incash Net cash outflow from financing 31 MAY 2012 STATEMENT FOR THE YEARENDED CONSOLIDATED CASH FLOW p16 Notes 21b 21a 21c (12,782) 23,364 £’000 (4,130) (866) (428) (39) (5) 112 2012 - 1 (4,023) (1,940) £’000 (1,035) 10,155 (7,167) (905) SECTION ELEVEN - (8,873) (11,616) £’000 (4,135) 5,000 5,065 (568) 9,325 (41) (5) 13 2011 (3,929) (4,127) £’000 (3,914) 2,206 2,206 1,906 (15) - NOTES TO THE ACCOUNTS 12 FOR THE YEAR ENDED 31 MAY 2012
1 ACCOUNTING POLICIES The Directors acknowledge the need for further discussion and The principle accounting policies are summarised below. They have all agreement with the bank, thereby giving rise to a degree of uncertainty been applied consistently throughout the year and the preceding year. on the final outcome regarding bank funding. However, the Directors consider discussions with the bank to be of appropriate comfort to (i) Accounting Convention them in the circumstances. In particular, the Directors consider it to be The financial statements are prepared under the historical cost common practice for many Premier League football clubs for the exact convention as modified by the revaluation of freehold properties, level and terms of the facility to be reviewed at the end of each football plant & equipment and in accordance with applicable law and United season. Based on the ongoing dialogue with the bank, the Directors are Kingdom accounting standards. confident that the current facilities will be renewed at a similar level, or replaced by equivalent facilities, for the 2013/14 Premier League season. (ii) Basis of Preparation The consolidated financial statements incorporate the financial The Group’s trading projections show that it has a reasonable statements of the company and all its subsidiary undertakings. expectation of staying within its currently available, and future The results of subsidiary undertakings acquired or disposed of during anticipated, finance facilities, including the overdraft and bank loan the year are included in the consolidated profit and loss account from facilities and the available agreed securitisation facilities against the date of their acquisition or up until the date of their disposal. future revenues referred to above, for at least 12 months from the date Intra-group trading is eliminated on consolidation. of signing of these accounts. In preparing these trading projections, a number of additional inherent uncertainties have been identified; As set out in the Directors’ Responsibilities Statement on page 10, notably on-field performance and the resultant reduction in the Premier in preparing these financial statements the Directors are required to League domestic broadcasting merit award payment and the level of prepare the financial statements on the going concern basis unless it player trading. is inappropriate to presume that the Group will continue in business. In satisfaction of this responsibility the Directors have reviewed in detail The Directors have considered the uncertainty surrounding the renewal the business’ cash flow projections, and considered the Group’s ability to of the facilities and other inherent uncertainties and, in the event that meet its liabilities as they fall due. they would be required, have identified a number of potential mitigating actions to manage any resulting forecast shortfall against current The Group meets its day to day working capital requirements through an facilities including the ability within the industry to securitise additional overdraft facility and a bank loan. Additionally, because of the predictable future guaranteed revenues and flexibility around player trading. nature of football club revenue streams, the Group has obtained further funding post year end through the securitisation of future guaranteed Based on the mitigating actions referred to above and the comfort revenues, as is common industry practice, and as it has done in the obtained from their bankers, the Directors have a reasonable expectation past. This funding replaced an existing loan of the same amount, and is that the Group will have adequate resources to continue in operational repayable in August 2013. Based on ongoing dialogue with the existing existence for the foreseeable future. Accordingly they adopt the going and potential funders, the Directors are confident that this facility will be concern basis in preparing the Annual Report and Accounts. replaced by an equivalent facility on repayment. (iii) Turnover The Group’s current overdraft facility and bank loan expire on 31 July Turnover is stated exclusive of value added tax, and match receipts are 2013. The timing of the expiry of the current facilities on 31 July 2013 recognised net of payments owing to visiting clubs, the Premier League, allows the Group’s bankers and the Directors to agree appropriate the Football Association and the Football League. facilities for the following season based on performance in the 2012/13 Premier League season and reflect activities, including the Group’s player Gate and other match day revenue is recognised over the period of trading activity in the January 2013 transfer window and the start of the the football season as games are played. Sponsorship and similar summer 2013 transfer window. commercial income is recognised over the duration of the respective contracts. The fixed element of broadcasting revenues is recognised The Directors have worked closely with the bank throughout the year over the duration of the football season it relates to whilst facility fees and based on discussions with the bank believe that it is the bank’s for live coverage or highlights are taken when earned. Merit awards are current intention to renew the facility agreements or put in place accounted for only when known at the end of the football season. arrangements to provide similar facilities for the following season, in each case subject to review at the end of the current football season with the knowledge of the level of player trading over the period and with the amount and terms to be negotiated at the appropriate time.
p17 SECTION TWELVE Everton Football Club Company Limited ANNUAL REPORT AND ACCOUNTS2012 remaining revised contract period. the amendment) andtherevised book value isamortisedover the the extensions are addedto theunamortisedbalance (at thedate of When aplaying contract isextended, any costs associated withsecuring year iscredited against additionsto intangible assets. and intangible assets’. The transfer fee levy refund received duringthe accordance withFinancial Reporting Standard 10 ‘Accounting for goodwill and amortisedover theperiodof therespective players’ contracts in The cost of players’ registrations, includingagents’ fees, iscapitalised (vii) Intangible Fixed Assets -Players’ Registrations liabilities are not discounted. more likely thannot thatthey willberecovered. Deferred tax assets and Deferred tax assets are recognised to theextent thatitisregarded as in financial statements. computations inperiodsdifferent from those in whichthey are included from theinclusionof items of income andexpenditure intaxation crystallise based oncurrent tax rates andlaw. Timing differences arise to pay less tax, atafuture date, atrates expected to applywhenthey in anobligationatthebalance sheet date to pay more tax, oraright Deferred taxation isprovided infullontimingdifferences thatresult (vi) b) Deferred Taxation sheet date. and laws thathave beenenacted orsubstantively enacted by thebalance is provided atamounts expected to bepaid (or recovered) usingtax rates Current taxation, includingUKcorporation tax andforeign tax, (vi) a) Current Taxation economic life of theasset to whichthey relate. to theprofit andloss account onasystematic basis over theuseful Grants of acapital nature are credited to deferred income andamortised (v) Grants 31st May 1999andthevaluations have not subsequently beenupdated. implementation of thatstandard. The properties were last revalued at amounts of certain freehold properties whichwere revalued priorto Reporting Standard 15‘Tangible fixed assets’ andretained thebook The Group hastaken advantage of thetransitional provisions of Financial vehicles andfive years for plant andequipment. Depreciation ischarged onastraight linebasis of three years for No depreciation isprovided onassets inthecourse of construction. of theassets whichare considered to bebetween 10and40years. in equalannualinstalments over theestimated useful economic lives (based onprices prevailing atthedate of acquisition orrevaluation) to write off thecosts orrevalued amounts less estimated residual value Depreciation is not provided on freehold land. On properties it is provided (iv) Tangible Fixed Assets andDepreciation 1 ACCOUNTING POLICIES (CONTINUED)
31 MAY 2012 FOR THEYEARENDED NOTES TO THEACCOUNTS p18 accounts for the Scheme asifitwere adefined contribution scheme. reliable basis and therefore, asrequired by FRS17‘Retirement benefits’, underlying assets andliabilities of theScheme onaconsistent and reduce theprovision. The Group isunable to identify its share of the in respect of this. Asaresult, the contributions paid to thescheme advised onlyof its share of theScheme’s deficit andrecognises aliability of anumberof participating employers intheFLLPLAS, theGroup is Scheme (“FLLPLAS”; Scheme”), “the adefined benefit scheme. Asone scheme, ortheFootball League Limited Pension andLife Assurance Limited Players Retirement Income Scheme, adefined contribution Certain staff of theGroup are members of eithertheFootball League (xiii) Pensions differences are recognised intheprofit andloss account. at therates of exchange ruling atthebalance sheet date. Allexchange assets andliabilities denominated inforeign currencies are translated sterling attherates rulingatthe dates of thetransactions. Monetary Transactions denominated inforeign currencies are translated into (xii) Foreign Currency Transactions a basis. over theperiodof thelease even whenpayments are not madeonsuch rentals are charged to theprofit andloss account onastraight linebasis the profit andloss account over theperiodof the lease. Operating lease useful lives. The interest element of therental obligationsischarged to and depreciated over theshorter of theirlease term ortheirestimated as afinance lease. Assets acquired underfinance leases are capitalised all therisks andrewards of ownership of anasset thelease istreated Where thecompany enters into alease whichentails substantially taking (xi) Lease Rentals for impairment. Investments heldasfixed assets are stated atcost less any provision (x) Investments (see note 22). service are not provided for butare noted ascontingent liabilities disposal ismade. Those instalments dueinthefuture oncontinued or loss ondisposal of players’ registrations intheyear inwhichtheplayer signing-on fees andloyalty bonuses dueare allocated infullagainst profit in thecircumstances of aplayer disposal. Inthatcase any remaining loss account intheperiodwhichpayment becomes due, except employment cost of theplayer andassuchare charged to theprofit and Signing-on fees andloyalty bonuses represent of anormalpart the (ix) Signing-onFees andLoyalty Bonuses contingent liabilities (see note 22). then noprovision ismadebutthepotential obligationsare disclosed as likelihood of meeting these criteria ismerely possible not probable, to beprobable, provision for thiscost ismade(see note 17).Ifthe appearance criteria specified inthetransfer agreement of theplayer Where thedirectors consider thelikelihood of aplayer meeting future (viii) Contingent Appearance Fees SECTION TWELVE
NOTES TO THE ACCOUNTS FOR THE YEAR ENDED 31 MAY 2012
2012 2011 2 TURNOVER £’000 £’000
Turnover, all of which originates in the United Kingdom, can be analysed as follows:
Gate receipts and programme sales 16,779 17,480
Broadcasting 52,790 52,890
Sponsorship, advertising and merchandising 7,068 6,800
Catering 924 877
Other commercial activities 2,970 3,974
80,531 82,021
2012 2011 3 OPERATING EXPENSES £’000 £’000
Amortisation of players’ registrations (note 10) 12,852 16,620
Staff costs (note 7) 63,389 58,026
Depreciation (note 11) 820 970
Other operating costs 22,724 23,554
Total operating expenses 99,785 99,170
2012 2011 4 OPERATING LOSS £’000 £’000
The operating loss is stated after charging / (crediting):
Depreciation - property 254 365
Depreciation - other 566 605
Amortisation of grants (38) (40)
Operating lease rentals
Motor vehicles 222 281
Office equipment 121 90
Land and properties 1,277 1,477
The analysis of auditor’s remuneration is as follows:
Fees payable to the company’s auditor for the audit of the company’s annual accounts 36 34
Fees payable to the company’s auditor for the audit of the company’s subsidiaries 6 6
Total audit fees 42 40
Other non-audit services
Tax services 177 309
Other services 83 24
Total non-audit fees 260 333
p19 SECTION TWELVE Everton Football Club Company Limited ANNUAL REPORT AND ACCOUNTS2012 Included ininterest onother loans isinterest of £1,891,000 (2011: £1,954,000) onloans not whollyrepayable infullwithinfive years. The Directors of theCompany received noremuneration duringtheyear (2011: £nil). Directors’ Remuneration In addition,theGroup employed anaverage of 400temporary staff onmatchdays (2011: 428). Other pensioncosts Social security costs Wages andsalaries Aggregate payroll costs for theabove employees were asfollows: Maintenance, Security, Pitch andGround Safety Management andAdministration Marketing andMedia Youth Academy Playing, training andmanagement The average weekly numberof employees duringtheyear was asfollows: 7 PARTICULARS OFEMPLOYEES Other loans Finance leases andhire purchase agreements Bank overdrafts 6 INTEREST PAYABLE ANDSIMILARCHARGES Bank interest receivable 5 INTEREST RECEIVABLE ANDSIMILARINCOME 31 MAY 2012 FOR THEYEARENDED NOTES TO THEACCOUNTS p20 SECTION TWELVE Number 63,389 55,549 £’000 £’000 £’000 4,105 7,465 2012 2012 2012 2012 3,241 228 859 375 48 112 87 35 27 31 5 Number 58,026 49,225 £’000 £’000 £’000 2,690 3,403 4,135 2011 2011 2011 2011 238 6,111 727 85 30 55 27 41 13 5 NOTES TO THE ACCOUNTS FOR THE YEAR ENDED 31 MAY 2012
8 TAX ON LOSS ON ORDINARY ACTIVITIES There was no tax charge in the year (2011: £nil). a) Factors affecting the tax charge for the current year The tax assessed for the year is lower than that resulting from applying the effective standard rate of corporation tax in the UK: 25.67% (2011: 27.67%). 2012 2011 £’000 £’000
Loss on ordinary activities before taxation (9,106) (5,413)
Tax on loss on ordinary activities at the standard rate (2,338) (1,498)
Expenses not deductible for tax purposes / (non-taxable income) 730 1,535
Depreciation in excess of capital allowances 234 200
Other short term timing differences 141 (20)
Excess of book profits relative to taxable profits on sale of fixed assets - (348)
Land remediation relief (1) -
Losses carried forward 1,234 140
Group relief - 68
Tax losses utilised - (77)
Current tax charge for the year - - b) Factors that may affect the future tax charge A deferred tax asset of £15.0m (2011: £14.4m) has not been recognised. The asset will be recovered when relevant profits are available against which the timing differences concerned will be offset.
9 COMPANY PROFIT AND LOSS ACCOUNT The Company has taken advantage of Section 408 of the Companies Act 2006 and has not presented its own profit and loss account. The Company’s loss for the year was £9,109,000 (2011: £5,414,000). TOTAL 10 INTANGIBLE FIXED ASSETS - GROUP AND COMPANY £’000
Cost
At 1st June 2011 91,990
Additions in the year 9,443
Disposals in the year (28,858)
At 31st May 2012 72,575
Amortisation
At 1st June 2011 58,662
Provided during the year 12,852
Eliminated on disposals (22,866)
At 31st May 2012 48,648
Net book value
At 31st May 2012 23,927
At 31st May 2011 33,328
p21 SECTION TWELVE Everton Football Club Company Limited ANNUAL REPORT AND ACCOUNTS2012 11 TANGIBLE FIXEDASSETS At 31st May 2011 At 31st May 2011 At 31st May 2012 Net bookvalue At 31st May 2012 Net bookvalue At 31st May 2012 At 31st May 2012 On disposals On disposals Provided duringtheyear Provided duringtheyear At 1st June2011 Depreciation At 1st June2011 Depreciation At 31st May 2012 At 31st May 2012 Disposals intheyear Disposals intheyear Additions intheyear Additions intheyear At 1st June2011 Cost orvaluation At 1st June2011 Cost orvaluation GROUP COMPANY 31 MAY 2012 FOR THEYEARENDED NOTES TO THEACCOUNTS p22 Properties Properties £’000 £’000 5,305 5,837 11,142 5,583 5,559 11,142 254 42 27 20 42 22 15 7 ------equipment equipment Plant and Plant and Plant and Plant and 8,438 8,438 £’000 £’000 9,525 9,525 1,087 1,087 7,892 7,892 9,106 9,106 1,214 1,214 554 554 428 428 SECTION TWELVE (8) (8) (9) (9) Vehicles Vehicles £’000 £’000 110 110 112 112 98 98 112 112 14 14 12 12 2 2 ------Total Total 20,779 14,385 20,360 £’000 £’000 6,394 8,575 9,679 13,573 9,260 6,787 8,010 1,104 1,250 820 428 428 573 (8) (8) (9) (9) NOTES TO THE ACCOUNTS FOR THE YEAR ENDED 31 MAY 2012
11 TANGIBLE FIXED ASSETS (CONTINUED) The Club’s premises at Goodison Park, the equipment and contents (but not including computer equipment or motor vehicles), together with an immaterial amount of residential properties were revalued at £12,272,550 by John Foord & Company as at 31st May 1999.
The freehold buildings at Goodison Park were valued at depreciated replacement cost, and the land at open market value for its existing use. The freehold land of £650,000 (2011: £650,000) has not been depreciated. The residential properties have been revalued at open market value basis with the benefit of full vacant possession or subject to and with the benefit of the various leases/agreements as appropriate.
If the freehold properties had not been revalued regularly since 1983 they would have been included at the following amounts on the basis previously appertaining: 2012 2011 £’000 £’000
Cost 9,146 9,146
Aggregate depreciation (5,010) (4,887)
Net book value 4,136 4,259
12 INVESTMENTS
Subsidiary FIXED ASSET INVESTMENTS undertakings
Company £
Cost
At 1st June 2011 and 31st May 2012 5
Net book value
At 1st June 2011 and 31st May 2012 5
Details of the principal operating subsidiaries as at 31st May 2012, all registered in England and Wales, were as follows:
Name of Company % owned Nature of business Goodison Park Stadium Limited 100 Provision of football entertainment facilities Everton Investments Limited 100 Issuer of loan notes The Everton Ladies Football Club Limited 100 Professional football club
CURRENT ASSET INVESTMENTS Group Current asset investments consist of four month treasury deposits of £2,767,000 (2011: £2,767,000).
p23 SECTION TWELVE Everton Football Club Company Limited ANNUAL REPORT AND ACCOUNTS2012 office equipment, asfollows: The Group andCompany hasoperating lease commitments to meet duringthenext year inrespect of landandproperty leases, motor vehicles and 13 LEASE COMMITMENTS Accruals anddeferred income Social security andother taxes Amounts dueto subsidiaries Trade creditors Obligations underfinance lease andhire purchase agreements Prepayments andaccrued income Expiring inmore thanfive years Other loans (see note 16) Other debtors Expiring between two andfive years Bank overdraft (secured) 15 CREDITORS -AMOUNTS FALLING DUEWITHINONEYEAR Trade debtors 14 DEBTORS Expiring withinoneyear Land andproperties £’000 1,346 2012 1,341 5 - 31 MAY 2012 FOR THEYEARENDED NOTES TO THEACCOUNTS p24 £’000 1,217 2011 1,217 - - 57,166 £’000 £’000 £’000 14,898 8,056 6,699 6,394 2,336 2012 2012 2012 11,015 18,121 5,719 108 141 39 33 Group Group Other - - 1 55,985 18,050 14,866 £’000 £’000 £’000 6,807 2,044 9,056 9,075 11,101 7,148 2011 2011 2011 265 247 SECTION TWELVE 39 18 - - 1 70,643 14,000 £’000 £’000 £’000 21,286 8,995 12,510 1,487 6,693 ,381 7, 2,273 2012 2012 2012 5,108 7,120 1,341 Company Company 113 39 33 Total - 70,682 10,995 £’000 £’000 £’000 21,628 14,033 2,004 1,482 0,774 1 6,798 9,245 8,991 8,165 2011 2011 2011 1,217 247 39 18 - NOTES TO THE ACCOUNTS FOR THE YEAR ENDED 31 MAY 2012
Group Company 2012 2011 2012 2011 16 CREDITORS - AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR £’000 £’000 £’000 £’000
Other loans (see borrowings below) 22,791 23,654 - -
Obligations under finance lease and hire purchase agreements 8 47 8 47
Trade creditors 975 3,057 975 3,057
Accruals and deferred income 3,402 5,246 2,431 4,237
27,1 76 32,004 3,414 7, 3 41
BORROWINGS
Finance leases and Bank overdraft Other loans Total hire purchase
2012 2011 2012 2011 2012 2011 2012 2011 Group £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000
Analysis of borrowings Payable by instalments:
Within one year 11,015 9,075 14,898 14,866 39 39 25,952 23,980
Between one and two years - - 968 898 8 47 976 945
Between two and five years - - 3,381 3,137 - - 3,381 3,137
After more than five years - - 18,746 19,959 - - 18,746 19,959
Prepaid finance costs - - (304) (340) - - (304) (340)
11,015 9,075 37,689 38,520 47 86 48,751 47,681
Finance leases and Bank overdraft Other loans Total hire purchase
2012 2011 2012 2011 2012 2011 2012 2011 Company £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000
Analysis of borrowings Payable by instalments:
Within one year 12,510 1 0,774 14,000 14,033 39 39 26,549 24,846
Between one and two years - - - - 8 47 8 47
12,510 10,774 14,000 14,033 47 86 26,557 24,893
p25 SECTION TWELVE Everton Football Club Company Limited ANNUAL REPORT AND ACCOUNTS2012 There are noamounts provided for deferred tax at31st May 2012 or31st May 2011. described innote 1. revenues. This loan incurs interest atarate of 8.9% andwas repaid inAugust 2012. The group hasobtained fundingpost further year endas Other loans also include£14,000,000 (2011: £14,000,000) secured by legalcharges over theCompany’s guaranteed Premier League broadcast in linewiththeinterest charge over aperiodof 25 years. £710,000, have beenoffset against theoriginal£30,000,000 loan, andare contained withinprepaid finance costs andcharged to theprofit andloss The notes willberepaid inasecuritisation agreement serviced by future season ticket sales. The costs incurred inraising thefinance, amounting to annual payments of £2,767,000 (includinginterest) starting on30th September 2003. interest rate of 7.79%. The first payment undertheagreement was madeon30th September 2002 amounting to £1,588,000 withsubsequent Other loans include£23,993,000 of loan notes (2011: £24,860,000) whichare repayable inannualinstalments over a25 year period atafixed the Company. The bank overdraft isprincipally secured viaalightweight floating charge over alltheassets andundertakings (excluding Goodison Park Stadium) of 16 BORROWINGS (CONTINUED) 17 PROVISION FOR LIABILITIES 18 EQUITY SHARECAPITAL At 31st May 2012 Provided intheyear Utilised intheyear At 1st June2011 35,000 ordinary shares of each £1 Allotted, issued andfullypaid 31 MAY 2012 FOR THEYEARENDED NOTES TO THEACCOUNTS p26 (note 23) Pensions £’000 838 (58) 607 289 SECTION TWELVE Group andCompany fees (note 1) appearance Contingent 2012 £’000 £’000 (892) 257 892 257 35 Total 2011 £’000 £’000 1,095 (950) 864 1,181 35 NOTES TO THE ACCOUNTS FOR THE YEAR ENDED 31 MAY 2012
19 RESERVES Share Revaluation Profit & loss premium reserve account account Group £’000 £’000 £’000
Balance at 1st June 2011 24,968 3,049 (63,239)
Loss for the year - - (9,106)
Balance at 31st May 2012 24,968 3,049 (72,345)
Share Revaluation Profit & loss premium reserve account account Company £’000 £’000 £’000
Balance at 1st June 2011 24,968 1,165 (59,799)
Loss for the year - - (9,109)
Balance at 31st May 2012 24,968 1,165 (68,908)
20 RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS’ DEFICIT 2012 2011 Group £’000 £’000
Loss for the year and net movement in shareholders’ deficit (9,106) (5,413)
Opening shareholders’ deficit (35,187) (29,774)
Closing shareholders’ deficit (44,293) (35,187)
p27 SECTION TWELVE Everton Football Club Company Limited ANNUAL REPORT AND ACCOUNTS2012 Current asset investments Finance lease andhire purchase agreements Debt dueafter oneyear Debt duewithinoneyear c) Reconciliation of movements innet debt 21 CASH FLOW STATEMENT Net debt asat31st May 2012 /2011 Net debt asat1st June2011 /2010 Non cash movements Change innet debt resulting from cash flows intheyear Cash outflow from decrease infinance lease andhire purchase financing Cash outflow from decrease innet debt Decrease incash intheyear Bank overdraft Profit ondisposal of players' registrations Loss before interest andtax a) Reconciliation of operating loss to net cash (outflow) /inflow from operating activities b) Analysis of changes innet debt Amortisation ofAmortisation players' registrations ofAmortisation grants Depreciation charge Operating loss Profit ondisposal of tangible fixed assets Net cash (outflow) /inflow from operating activities (Decrease) /increase increditors Increase /(decrease) inprovisions (Increase) /decrease indebtors 31 MAY 2012 FOR THEYEARENDED NOTES TO THEACCOUNTS p28 At 1st June (44,914) 2011 (23,654) (14,866) (9,075) (9,075) £’000 2,767 (86) Cash flows (1,940) (1,035) (1,940) £’000 866 SECTION TWELVE 39 - - movements Non cash (45,984) 2012 2012 (19,254) (44,914) (1,008) (1,088) (7,167) (1,940) £’000 £’000 £’000 (14,141) (1,035) 12,852 (5,113) (898) (35) 866 (38) 863 (35) 820 549 39 - - - - - At 31st May (45,984) 2011 2011 2012 (44,914) (44,863) (14,898) (17,149) (11,015) (22,791) (8,432) (3,929) (7,426) (11,015) £’000 £’000 £’000 16,620 (1,291) 1,906 3,873 2,767 1,093 (40) (58) (36) (47) 970 470 (15) 41 NOTES TO THE ACCOUNTS FOR THE YEAR ENDED 31 MAY 2012
22 CONTINGENT LIABILITIES No provision is included in the accounts for transfer fees of £7,424,000 (2011: £7,585,000) which are, as at 31st May 2012, contingent upon future appearances of certain players; or signing-on fees and loyalty bonuses, as at 31st May 2012, of £5,398,000 (2011: £6,427,000) which would become due to certain players if they are still in the service of the Club on specific future dates.
23 PENSIONS Certain staff of the Group are members of either the Football League Limited Players Retirement Income Scheme, a defined contribution scheme, or the Football League Limited Pension and Life Assurance Scheme (“FLLPLAS”; “the Scheme”), a defined benefit scheme. As one of a number of participating employers in the FLLPLAS, the Group is advised only of its share of the Scheme’s deficit and recognises a liability in respect of this. As a result, the contributions paid to the scheme reduce the provision. The Group is unable to identify its share of the underlying assets and liabilities of the Scheme on a consistent and reliable basis and therefore, as required by FRS 17 ‘Retirement benefits’, accounts for the Scheme as if it were a defined contribution scheme. In May 2012 a further MFR deficit was identified in the Scheme, which increased the outstanding deficit allocated to the Group by £607,000 resulting in an increase in contributions advised by the Actuary.
Contributions are also paid into individuals private pension schemes. Total contributions across all schemes during the year amounted to £375,000 (2011: £2,690,000).
24 POST BALANCE SHEET EVENTS Since 31st May 2012, the Club has entered into transfer agreements for confirmed contracted net transfer fees receivable of £1,092,000.
25 FRS 8 - RELATED PARTY TRANSACTIONS Everton In The Community is a registered Charity (Number 1099366) incorporated on 31st July 2003 and began trading on 1st June 2004. The Charity operates separately from the Group hence has not been consolidated in the Group results, but as at 31st May 2012 Everton Football Club Company Limited employees held two of the six Trustee positions at the Charity. During the year Everton Football Club Company Limited incurred net operating costs of £120,000 (2011: £204,000) on behalf of the Charity.
26 CAPITAL COMMITMENTS There were no capital commitments at 31st May 2012 or 31st May 2011.
p29 SECTION TWELVE Everton Football Club Company Limited ANNUAL REPORT AND ACCOUNTS2012 13 28.04.12 09.04.12 04.01.12 20.08.11 21.03.12 10.03.12 13.05.12 31.03.12 06.05.12 04.02.12 14.04.12 18.02.12 24.08.11 21.01.12 11.02.12 22.04.12 04.12.11 03.03.12 31.01.12 07.04.12 10.09.11 26.10.11 24.03.12 29.10.11 07.01.12 27.01.12 01.05.12 17.03.12 27.03.12 17.09.11 24.09.11 21.09.11 21.12.11 01.10.11 13.03.12 27.08.11 01.01.12 17.12.11 14.01.12 26.12.11 23.10.11 19.11.11 11.01.12 05.11.11 15.10.11 10.12.11 26.11.11 D ATE OPPONENT QUEENS PARK RANGERS LIVERPOOL MANCHESTER CITY WIGAN ATHLETIC ASTON VILLA SHEFFIELD UNITED-CARLING CUP R2 BLACKBURN ROVERS FULHAM CHELSEA WEST BROMWICH ALBION-CARLING CUP R3 CHELSEA -CARLING CUP R4 MANCHESTER UNITED SWANSEA CITY ARSENAL STOKE CITY NORWICH CITY BOLTON WANDERERS WOLVERHAMPTON WANDERERS NEWCASTLE UNITED MANCHESTER CITY ASTON VILLA TOTTENHAM HOTSPUR TAMWORTH -FA CUP R3 SUNDERLAND QUEENS PARK RANGERS BLACKPOOL -FA CUP R5 BLACKBURN ROVERS BOLTON WANDERERS WEST BROMWICH ALBION TOTTENHAM HOTSPUR SUNDERLAND WEST BROMWICHALBION SWANSEA CITY ARSENAL SUNDERLAND -FA CUP QF NORWICH CITY SUNDERLAND -FA CUP QFREPLAY WIGAN ATHLETIC CHELSEA FULHAM -FA CUP R4 MANCHESTER UNITED LIVERPOOL -FA CUP SF LIVERPOOL WOLVERHAMPTON WANDERERS STOKE CITY FULHAM NEWCASTLE UNITED H H H H H H H H H H H H H H H H H H H H H H H H H H A A A A A A A A A A A A A A A A A A A A FIRST TEAMRESULTS 2011/12 p30 RESULT 4-0 4-0 2-0 2-0 0-2 2-2 2-0 2-0 0-0 4-4 2-0 2-0 2-0 0-2 0-2 1-0 1-0 1-0 0-3 0-1 0-1 0-1 0-1 1-2 1-2 3-1 2-1 3-1 2-2 3-1 1-0 1-2 2-1 1-0 2-1 0-1 3-1 1-2 1-3 1-1 1-1 1-1 1-1 1-1 1-1 1-1 1-1 ATTEND 32,004 32,464 35,008 29,856 30,330 35,494 32,249 34,992 33,593 33,924 25,300 32,736 38,347 38,875 31,885 31,004 27,564 32,051 26,500 20,509 60,062 33,219 39,510 29,561 25,646 25,466 26,554 24,058 31,576 23,170 39,517 22,826 23,038 75,522 18,340 47,293 17,647 43,140 43,619 87,231 18,033 50,671 44,921 31,853 41,789 36,132 17,173 ANCE SECTION THIRTEEN POINTS 20 43 56 24 29 26 47 33 40 44 48 37 37 30 34 52 25 53 24 24 37 10 16 51 13 17 10 10 16 16 21 4 7 7 3 7 7 ------POSITION 18 14 10 14 10 10 10 12 16 10 10 10 16 12 13 13 11 11 11 9 9 7 8 7 7 7 7 9 9 9 9 11 11 11 7 7 7 7 ------BARCLAYS PREMIER LEAGUE 14 FINAL LEAGUE PLACINGS 2011/12 AND FIXTURES 2012/13
HOME AWAY FINAL LEAGUE PLACINGS 2011/12 P W D L F A W D L F A GL DIF. PTS MANCHESTER CITY 38 18 1 0 55 12 10 4 5 38 17 64 89 MANCHESTER UNITED 38 15 2 2 52 19 13 3 3 37 14 56 89 ARSENAL 38 12 4 3 39 17 9 3 7 35 32 25 70 TOTTENHAM HOTSPUR 38 13 3 3 39 17 7 6 6 27 24 25 69 NEWCASTLE UNITED 38 11 5 3 29 17 8 3 8 27 34 5 65 CHELSEA 38 12 3 4 41 24 6 7 6 24 22 19 64 EVERTON 38 10 3 6 28 15 5 8 6 22 25 10 56 LIVERPOOL 38 6 9 4 24 16 8 1 10 23 24 7 52 FULHAM 38 10 5 4 36 26 4 5 10 12 25 -3 52 WEST BROMWICH ALBION 38 6 3 10 21 22 7 5 7 24 30 -7 47 SWANSEA CITY 38 8 7 4 27 18 4 4 11 17 33 -7 47 NORWICH CITY 38 7 6 6 28 30 5 5 9 24 36 -14 47 SUNDERLAND 38 7 7 5 26 17 4 5 10 19 29 -1 45 STOKE CITY 38 7 8 4 25 20 4 4 11 11 33 -17 45 WIGAN ATHLETIC 38 5 7 7 22 27 6 3 10 20 35 -20 43 ASTON VILLA 38 4 7 8 20 25 3 10 6 17 28 -16 38 QUEENS PARK RANGERS 38 7 5 7 24 25 3 2 14 19 41 -23 37 BOLTON WANDERERS 38 4 4 11 23 39 6 2 11 23 38 -31 36 BLACKBURN ROVERS 38 6 1 12 26 33 2 6 11 22 45 -30 31 WOLVERHAMPTON WANDERERS 38 3 3 13 19 43 2 7 10 21 39 -42 25
FIXTURES 2012/13 DATE OPPONENT DATE OPPONENT 20.08.12 MANCHESTER UNITED H 07.01.13 CHELTENHAM TOWN - FA CUP R3 A 25.08.12 ASTON VILLA A 12.01.13 SWANSEA CITY H 29.08.12 LEYTON ORIENT - CAPITAL ONE CUP R2 H 21.01.13 SOUTHAMPTON A 01.09.12 WEST BROMWICH ALBION A 26.01.13 FA CUP R4 17.09.12 NEWCASTLE UNITED H 30.01.13 WEST BROMWICH ALBION H 22.09.12 SWANSEA CITY A 02.02.13 ASTON VILLA H 25.09.12 LEEDS UNITED - CAPITAL ONE CUP R3 A 10.02.13 MANCHESTER UNITED A 29.09.12 SOUTHAMPTON H 16.02.13 FA CUP R5 06.10.12 WIGAN ATHLETIC A 23.02.13 NORWICH CITY A 21.10.12 QUEENS PARK RANGERS A 02.03.13 READING H 28.10.12 LIVERPOOL H 09.03.13 ARSENAL A 03.11.12 FULHAM A 09.03.13 FA CUP R6 10.11.12 SUNDERLAND H 16.03.13 MANCHESTER CITY H 17.11.12 READING A 30.03.13 STOKE CITY H 24.11.12 NORWICH CITY H 06.04.13 TOTTENHAM HOTSPUR A 28.11.12 ARSENAL H 13.04.13 QUEENS PARK RANGERS H 01.12.12 MANCHESTER CITY A 14.04.13 FA CUP SEMI FINAL 09.12.12 TOTTENHAM HOTSPUR H 20.04.13 SUNDERLAND A 15.12.12 STOKE CITY A 27.04.13 FULHAM H 22.12.12 WEST HAM UNITED A 04.05.13 LIVERPOOL A 26.12.12 WIGAN ATHLETIC H 11.05.13 FA CUP FINAL 30.12.12 CHELSEA H 12.05.13 WEST HAM UNITED H 02.01.13 NEWCASTLE UNITED A 19.05.13 CHELSEA A
p31 SECTION FOURTEEN 2012 EVERTON 15 FOOTBALL CLUB COMPANY LTD
Honours List FIRST DIVISION CHAMPIONS 1890/91, 1914/15, 1927/28, 1931/32, 1938/39, 1962/63, 1969/70, 1984/85, 1986/87 RUNNERS-UP 1889/90, 1894/95, 1901/02, 1904/05, 1908/09, 1911/12, 1985/86 SECOND DIVISION CHAMPIONS 1930/31 RUNNERS-UP 1953/54 FA CUP WINNERS 1906, 1933, 1966, 1984, 1995 RUNNERS-UP 1893, 1897, 1907, 1968, 1985, 1986, 1989, 2009 FOOTBALL LEAGUE CUP RUNNERS-UP 1976/77, 1983/84 FA CHARITY SHIELD WINNERS 1928, 1932, 1963, 1970, 1984, 1985, 1987, 1995, SHARED: 1986 EUROPEAN CUP-WINNERS’ CUP WINNERS 1984/85 FA YOUTH CUP WINNERS 1964/65, 1983/84, 1997/98 RUNNERS-UP 1960/61, 1976/77, 1982/83, 2001/02
SECTION FIFTEEN