Lynch: “I don’t really understand it” – the mystery of Klopp’s £9.6m Liverpool payout | OneFootball

Liverpool’s Finances: Why the £57m Loss Is Not as Bad as It Seems

Liverpool’s latest financial accounts showed a pre-tax loss of £57 million, prompting widespread discussion among fans and analysts. While the headline figure may appear concerning, a deeper look at the club’s financial structure suggests that Liverpool remain in a strong position.

In the latest episode of Media Matters on Anfield Index, journalist David Lynch joined Dave Davis to break down the club’s accounts, explaining why the figures are far from disastrous and discussing the unexpected £9.6 million payout to Jürgen Klopp and his coaching staff.

Liverpool’s Financial Model and the Champions League Factor

The biggest factor behind Liverpool’s reported loss was their absence from the Champions League. The club relies heavily on broadcasting revenue, and missing out on Europe’s premier competition created a financial shortfall.

“I think it’s kind of as was expected, really,” Lynch explained. “They were probably going to have a significant loss off the back of not being in the Champions League.”

Liverpool’s ownership model under FSG is based on reinvesting revenues back into the club rather than operating at a profit. Without the Champions League’s £50 million+ in broadcasting and prize money, it became difficult to break even.

However, there were positive signs in the accounts. “We’ve seen real kind of growth in commercial [revenue] off the back of the new sponsorships,” Lynch noted. “That area of the club is just continuing to go from strength to strength.”

Additionally, the Anfield Road Stand expansion has increased matchday revenue, further strengthening the club’s long-term financial outlook.

Photo by IMAGO

Why Liverpool’s Financial Future Looks Secure

Despite the short-term loss, Liverpool’s finances remain stable. The return to the Champions League next season will provide an immediate boost, ensuring this year’s figures are an anomaly rather than a worrying trend.

Lynch pointed out that the club’s commercial and matchday growth is outpacing the rise in administrative costs. “The growth in commercial and matchday is kind of outstripping those costs,” he said. “When you factor in that Champions League football is coming back, Liverpool are going to be hitting a nice spot.”

Additionally, Liverpool are not expected to start running at a profit. The focus is on maintaining a sustainable balance. “I still think Liverpool will… not be delving into making profits,” Lynch explained. “The aim is to kind of break even, really.”

That means more money will be available for player transfers and wages, ensuring Liverpool remain competitive at the top level.

The Klopp Payoff: Surprise But Not Major Issue

One unexpected aspect of the accounts was the £9.6 million paid to Klopp and his backroom staff following their departure. While some fans questioned why Klopp received a payout after resigning, Lynch admitted that the explanation remains unclear.

“It’s a strange one,” he said. “I can’t say I’m an expert in these contractual issues, and people I’ve spoken to couldn’t really give me a satisfactory explanation around that.”

The general belief is that the payout was due to contractual agreements and severance payments for staff members who did not choose to leave.

“There’s a comment there coming in that he deserves every penny, which is probably fair enough,” Lynch said. “But it is a little bit strange for someone who resigned to get a payoff.”

Ultimately, while the Klopp settlement was unexpected, it does not significantly impact the club’s financial health.

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Liverpool’s Accounts in Perspective

Liverpool’s £57 million loss may have caused alarm at first glance, but the underlying factors show a club in strong financial shape. The return of Champions League revenue, increasing commercial deals, and expanded matchday income all point to a stable future.

As Lynch summarised: “I wouldn’t focus too much on that £57 million deficit… They should kind of even each other out.”

With a return to Europe and continued commercial growth, Liverpool’s long-term financial outlook remains positive.