Liverpool managing director Ian Ayre insists the “pain” associated with the cost of restructuring the squad will be worth the effort after the club posted losses of £40.5 million (€47m).
The club’s debt rose by £21.8m (€25.2m) to £87.2m (€101.1m) in the 10 months between August 1 2011 to May 31 2012 — a restructured period designed to bring alignment with the football season.
However, the loss was less than the £49.3m (€57.2m) made the previous year and done against the backdrop of no European football, although Liverpool did get to two cup finals, winning one.
Some of the deficit was as a result of investing heavily in the transfer market — and the costs associated with bringing in the likes of Stewart Downing (£20m) and Jordan Henderson (£16m) in the weeks preceding the accounting period — while offloading other players at a loss.
But with the club’s owners, Fenway Sports Group, firmly focused on the impending arrival of Financial Fair Play, Ayre stressed there was necessary work to be undertaken.
“I take comfort in the fact that the work we have done, some of which costs us a lot of money in this period and beyond, looks pretty painful at the time,” he said.
“But as long as you invest in it and manage it in the right way, then hopefully it bears fruit as we go forward.”
In the period relating to these accounts the club offloaded 11 players, including the likes of Milan Jovanovic, Christian Poulsen and Raul Meireles — all signings by previous managers. The then boss Kenny Dalglish — the cost of whose sacking last May was included in £9.5m of “exceptional payments” — wanted reinforcements for his squad and that meant players had to be moved on to make room.
In addition to transfer-related costs captain Steven Gerrard and Luis Suarez were among five players who signed new contracts during the accounting period, since the end of which FSG have injected £46.8m (€54.3m) via a non-interest bearing intercompany loan.
Turnover increased by £5m (€5.8m) but so did wages, with the salary bill now around £142m (€164.7m) or 70% of income.
The figures do not include the record £25m-a-season six-year sponsorship deal with kit manufacturers Warrior, which came into effect last summer and could net the club a similar amount through associated merchandising.
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