LIVERPOOL, England — Sylvester Stallone is an Everton supporter and perhaps the most apt celebrity fan of any Premier League team. After all, the Hollywood actor built a career on rolling with the punches and hauling himself off the canvas as Rocky Balboa. His story has become the story of Everton, a club that doesn’t know where the next punch is coming from.
For this season at least, Everton have been able to fight back and ready themselves for whatever new setback or challenge came their way. Having been hit with two separate points deductions by the Premier League for breaching financial regulations — a 10-point penalty was reduced to six on appeal, while the club is challenging an additional two-point deduction — Sean Dyche’s team has rallied in recent weeks to pull clear of the relegation zone and seemingly secure their top-flight status.
But while the construction of a new £750m, 52,888-capacity stadium on the banks of the River Mersey points to a bright new future for Everton, the months ahead continue to be laced with peril for one of England‘s most historic clubs.
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The worst-case scenario is that Everton will be hit with further points deductions next season and potentially enter administration — a rescue mechanism for insolvent companies — if a proposed takeover by 777 Partners, a Miami-based private investment company which owns football teams around the world, fails to get over the line.
Everton face Luton Town at Kenilworth Road on Friday having ensured their Premier League survival with three wins in the space of six days last week, including a first home win against city rivals Liverpool since 2010, but they continue to fight for their future.
While Manchester City and West Ham United moved into stadiums built with taxpayers’ money for the 2002 Commonwealth Games and 2012 Olympics respectively, paying only a peppercorn rent — essentially a nominal fee for the privilege, with West Ham paying £3.6m in 2023 and City charged £2m per year on a 250-year lease with the Manchester City Council — Everton are having to pay to build their new home, and they have found themselves being engulfed by a perfect storm of COVID-19, the invasion of Ukraine and the panic to fund the construction of the stadium.
To add to Everton’s predicament, there is no prospect of raising significant funds with the sale of Goodison Park due to its location. Instead, Everton are committed to transforming the site into a hub for the local community.
The club had amassed losses of £371.8m, which included short-term borrowing to cover stadium costs, during a three-year period — Premier League profit & sustainability rules (PSR) allowed for a maximum loss of £105m over three years — with the impact of the pandemic being blamed for up to £220m of that figure. “Losses of at least £170m are attributed to the impact on the club of the Covid-19 pandemic, with £103m of that figure coming in the 2020-21 financial year,” then-Everton CEO Denise Barrett-Baxendale said. “The wide-ranging impact of COVID-19 on Everton — which further market analysis has indicated could include an additional £50m — covers lost revenues, additional costs due to strict COVID-19 protocols and a significant contraction in the transfer market which resulted in the inability to generate the level of transfer fees which could reasonably have been expected pre-pandemic.”
Those financial numbers, combined with interest costs of £25m related to the new stadium, saw Everton breach the PSR regulations, even allowing for so-called “add-backs” in relation to the pandemic, and the Premier League’s first sanction was to deduct the club 10 points last November for losses totalling £124.5m for the three-year period up to the end of the 2021-22 season. That penalty was reduced on appeal to six points in February. In April, the Premier League docked Everton two points for losses totalling £121.6m for the three-year period up to the end of the 2022-23 season. Everton has appealed against the deduction.
“We’ve been through it once, and we’ll go through it again,” Dyche said at the time. “The time for fault and blame has gone. We’re past that.”
