Everton hit with brand new £104m PSR problem

Everton are now poised to deal with a brand new PSR problem, immediately after dodging punishment for their financial performance last season

The Toffees are believed to have recouped around £20m from the sales of Ben Godfrey and Lewis Dobbin.

The latter deal cause controversy, with some quarters believing that the PSR-busting quasi-swap deal the club engineered with Nottingham Forest was against the spirit of the rules.

But Everton were in a desperate situation having been hit with two separate points deductions in 2023-24 as a result of monumental year-on-year losses.

Dan Friedkin, who is currently in exclusive talks with Farhad Moshiri to buy the club, will have to deal with legacy of those losses when his premiership on Merseyside begins.

And in the short term, Everton’s PSR issues could actually be about to get a whole lot worse.

Everton face much tighter PSR situation in 2024-25

Essentially, Everton have passed PSR for the three-year period up to 2023-24 because of the £4m PSR loss they posted in 2021-22.

However, that relatively small figure is not longer part of the equation.

Everton’s reported PSR loss for 2022-23 was £62.7m, smaller than their headline loss of £89.1m because of deductible costs.

Analysis from football finance expert Swiss Ramble meanwhile projects that Everton are set to post a similar loss when they release their accounts for 2023-24.

That would give them combined PSR losses of £124m over the last two seasons up to 2024-25.

Premier League clubs are allowed to lose a maximum of £105m over a rolling three-year period, so long as the bulk of that figure is underwritten by an investor.

That means Everton would need to post a profit in 2024-25 or face another fine or points deduction.

For context, the Toffees have lost over £100m in four of the last five seasons.

Their wages-to-turnover ratio, which is one of the worst in the division, as well as an amortisation bill of around £75m will make that very difficult.

Everton’s PSR issues could be impacted by Premier League dispute

To complicate matters, Everton are also under continued scrutiny by the Premier League with regards to their 2022-23 accounts.

The issue relates to disputed figures relating to the capitalisation of interest payments on their new stadium at Bramley Moore Dock.

Everton and their auditors believe that these payments should not be factored into the PSR calculation, while the Premier League insist the opposite is true.

A follow-up hearing has been scheduled, which could have a major bearing on Everton’s financial future if it goes against them.

If the capitalised interest payments are included in their PSR calculation, they would likely be hit with yet another points deduction and a fine.