[Archived] Why Do We Have No Money

[Hasta]

Paul you have changed your stance very slightly look at the earlier post, You seem to indicate within that quote to that we will receive 30 million in TV revenue, were the actual figure will be around 40 million. That is the skewing of the numbers im talking about,

I'm not going to join in the debate because it does go over my head a bit and little knowledge can be dangerous. However does Paul not state (several times) £30 million in TV revunue + £10 million in 'place' money. Or are you saying we actually receive £40 million + £10 mill ??

[RevidgeBlue]

I'm not going to join in the debate because it does go over my head a bit and little knowledge can be dangerous. However does Paul not state (several times) £30 million in TV revunue + £10 million in 'place' money. Or are you saying we actually receive £40 million + £10 mill ??

Minimum TV money this year is c 30m, a mid table finish should ensure c 40m in TV and place revenue and our total turnover should be around 50m thanks to the "new" TV money.

[USRoverME]

Bazza you still aren't reading properly.

#1 - He hasn't changed stance, perhaps your "skewed" reading of his posts has changed. In the second quote you cherry picked, later in that post he adds in the assumed 10 mil from placement money, which as we all well know is not a certainty. As an aside, personally I like the club playing with known money as opposed to playing with money that may never arrive (ie sparky leaves, team spirit crumbles, we finish 17th. we stay in the prem but lose out on 7 mil).

#2 - he's never questioned your 'knowledge' of the 30 mil base tv income plus approx 10 mil for placement. he's questioning your assumption about the wages. comparing 05/06 wages and estimated 07/08 income without trying to account for any increase in wages is a mammoth error in judgement when trying to figure out how much cash is available.

#3 - Just as an aside. Hughes is publically saying we have no money. I wouldn't be surprised if it not just a front. Hughes is and has been shrewd. WE lay low, look like non-players for the first 3 to 3.5 weeks of the window, and then we pounce. Might give us a wind up and a heart attack or two as we get linked with mozzer's "komous" and the mis-spelled andy faye... but untill the window closes, I'm still not 100% convinced we have no money.

[joey_big_nose]

#3 - Just as an aside. Hughes is publically saying we have no money. I wouldn't be surprised if it not just a front. Hughes is and has been shrewd. WE lay low, look like non-players for the first 3 to 3.5 weeks of the window, and then we pounce. Might give us a wind up and a heart attack or two as we get linked with mozzer's "komous" and the mis-spelled andy faye... but untill the window closes, I'm still not 100% convinced we have no money.

To be fait this is pretty much how we operate. And to be honest how pretty much everyone, apart from Chelsea, operates these days. Buying early means paying high prices or being strung out unless the club selling do want to get rid early so they can afford a replacement.

I wouldn't be utterly suprised if Roberts left and we ended up getting Sidwell, Koumas, The Bulgarian fellow and Lance Davids. But all of those transfers being completed near the last day.

From what everyone has said my guess would be we do have a moderate amount of money - especially if Roberts leaves (although I would like him to stay) - which can be released to get in decent players as the opportunity arises.

[Paul]

One question if he have no money left- how the hell did we survive before the extra 15 million

Oh dearie me....you're grasp of the financial realities of life are clearly minimal.

I haven't changed my stance at all, if you bothered to read you'd see I had found the 06 accounts and used those in my most recent post, previously I had used the 05 figures. It's clearly not worth borthering to try and explain things to you though as you're only prepared to read the bits that suit your arguement. Now I wonder why that is?

[Blackburn Ender]

A couple of things strike me (following Brian Potter's excellent post on the Trust):

Jack came from the era when Rovers really did have virtually no money (no TV deals, 5,000+ gates, etc).

If he and the Trust were caught out by the massive increase in running costs for a Premiership club, then you can see how the Trust are in a difficult position.

To run the Trust properly, they musrt operate with caution, and take the long view.

That has to mean the club breaking even with no external debt.

If over the next 10-20 years, or more, wages, TV income, gate receipts, transfer fees, etc, all fall significantly, then Rovers would once again - thanks to the Trust - be able to out-spend most of their rivals.

Because the trust is sitting on upwards of £600m-£700m to keep Rovers afloat and in the Premiership.

Only a cash-rich buyer wanting to play Premiership Monopoly right now has any chance of taking over.

[SIMON GARNERS 194]

Because the trust is sitting on upwards of £600m-£700m to keep Rovers afloat and in the Premiership.

I think you may be way,way off the mark there Blackburn Ender!

[stuwilky]

And a wage bill of between 33-37 million.

I'm extremely interested in seeing the year ending summer 2007's wage figure. Given that the last figure available (for y/e summer 2006) was almost £34m I think it will be very telling.

[Blackburn Ender]

Oh, I don't know.

You think they have more?

The last Sunday Times Rich List (published April 29, 2007) estimated the Walker Family's value at £750m.

[SIMON GARNERS 194]

All I am saying is that basically the Walkers want out and that £750 million isn't the clubs and never will be.

[Driftpeasant]

Couldnt hurt could it. I will do one myself and send the money order, even if I help pay for a fraction of the Axe's wages I will see that as an accomplishment and would make me feel better about having him.

Have you considered donating to the Season Tickets for Charity drive? We pay full price for tickets to help support the club, and try to grow the fanbase by getting kids in the seats. It's a two-pronged approach, and the more money, the more tickets, and the more revenue for Rovers. It's fundraising, but with an eye to the future.

[allanncd]

If as it seems the Trustees refuse to put any more money into the club why don't they sell dfor nothing but insist the new owners put a substantial amount in as share capital? It's called greed.

[LeChuck]

If as it seems the Trustees refuse to put any more money into the club why don't they sell dfor nothing but insist the new owners put a substantial amount in as share capital? It's called greed.

That's exactly the sort of deal Sir Jack Hayward left Wolves with, he sold the club for £10 as long as £30 million was guaranteed to be invested (link).

I don't think our owners will do anything similar though, they'll probably try to get every penny they can from the sale.

[thenodrog]

If as it seems the Trustees refuse to put any more money into the club why don't they sell dfor nothing but insist the new owners put a substantial amount in as share capital? It's called greed.

Don't be pathetic. We are where we are because of the Walker families original generosity. Go back to the late 80's and we'd all have taken the next 20 years in a heartbeat. So many people forget or are too young or thick to remember that with our natural resources our club's true place in modern football is to be hovering up and down the lower divisions with the dead men. Instead of this we are slugging it out on an equal league footing with clubs of infiniteley greater resource and potential. Struggling for equal funding is aggravating and to an extent debilitating but there must be 80 odd other clubs and their supporters who would swap with us in an instant.

[Tris]

If as it seems the Trustees refuse to put any more money into the club why don't they sell dfor nothing but insist the new owners put a substantial amount in as share capital? It's called greed.

Why don't you actually read and digest what has been posted previously - especially the well informed and well written posts by BrianPotter and Paul.

Greed is the very last accusation you can make towards the Jack Walker Trust. Uninformed internet posters who continue to slag off the trustees do nothing more than to add fuel to a fire which should never have been started.

[philipl]

That's exactly the sort of deal Sir Jack Hayward left Wolves with, he sold the club for £10 as long as £30 million was guaranteed to be invested (link).

I don't think our owners will do anything similar though, they'll probably try to get every penny they can from the sale.

The issue is finding new owners who will be more generous to the Rovers than the Trust has been.

Thus far there has been nobody who can meet that criteria.

[thenodrog]

The issue is finding new owners who will be more generous to the Rovers than the Trust has been.

Thus far there has been nobody who can meet that criteria.

Difficult to imagine one that either will or is able to.

[allanncd]

The Trustees HAVE been generous - the key is in the past tense. Now they are tightening the strings and putting an unrealistic value on the club. They try to have it both ways but by doing so they are inviting a large loss and nothing to salvage when the club is relegated. Lucky for us and them that MH leaving has been deferred yet again.

[Tris]

The Trustees HAVE been generous - the key is in the past tense. Now they are tightening the strings and putting an unrealistic value on the club. They try to have it both ways but by doing so they are inviting a large loss and nothing to salvage when the club is relegated. Lucky for us and them that MH leaving has been deferred yet again.

What unrealistic value??

The only thing stopping a change in ownership is the safeguard put in place by Jack Walker - that any owner taking over from those who manage his legacy has to do better for Rovers.

His legacy contains extraordinary guarantees for the long term security of Rovers, even if in the short term the trust can make little difference in the crazy top flight transfer market.

£5.7 million for McFadden anyone????? It doesn't matter if the club is bankrolled by the Jack Walker Trust or Harry Houdini - at those prices how can any sane person argue that we should twist rather than stick??

[stuwilky]

If as it seems the Trustees refuse to put any more money into the club why don't they sell dfor nothing but insist the new owners put a substantial amount in as share capital? It's called greed.

Youve made my night.

Well done, those greedy trustees who have been giving us money hand over fist since Jack died.....

Christ, some people are beyond help.

[RevidgeBlue]

His legacy contains extraordinary guarantees for the long term security of Rovers, even if in the short term the trust can make little difference in the crazy top flight transfer market.

If it's that simple, why does Mark Hughes keep stressing the need for new investment, and why has John Williams acknowledged that one of his primary functions as chairman of the new streamlined board is to attract new investment?

Further I would respectfully suggest that if we ever go down we'll be in as much trouble as the next club without Jack around in person to bail us out a second time.

[RevidgeBlue]

Well done, those greedy trustees who have been giving us money hand over fist since Jack died.....

But not any more it seems.

And that's not wanting to detract in any way from what they've done in the past.

[philipl]

I have a very limited but pretty reliable insight into The Jack Walker Settlement through a business associate who has links with Rathbones. Bear in mind his knowledge is limited to the Trust, he doesn't know a great deal about Blackburn Rovers.

I was discussing the Rovers situation with him yesterday in light of the recent Hughes to Newcastle rumours. Here are a few intersting points that he made:

The Trust Withdrawing the £3m donation:

As far as he understood the £3m is still available for the club. It was stated that the Trustees felt there was CURRENTLY no need for ADDITIONAL invesment. The emphasis being on the words currently and additional.

The Trust Support for the Club and Financing:

This is a complicated one to put down in a few words, but here goes.

The problem the Trustees and Utlimatley the Club has is that when the deeds of the Trust were put into place it made what was considered sufficient provision to support the club for the forseable future, providing additional income and funding for transfers. What the Trust did not allow for was the financial explosion in the football sector. The original structure for supporting the club is simply not making the impact it was intended to do due to the huge rise in transfer fees and wages over the past 6 or 7 years. Jack Walkers plan was always for the club to be self sufficient where by any additional money provided by the Trustees would give them an advantageous position.

The Trustees want to sell the club to enable it to move forward. They will only consider selling the club to an entity that would put it in a better position than it is currently - this factor is also related to the Deeds of The Trust (but my source didnt know any more on that).

They are not in a position to provide the club with year on year investment that would make us competetive at the highest level in the transfer market, hence the need for outside investment.

There is currently money available for transfers, each case would be judged on its individual merits and if it was agreed the deal suited the club money would be released by the Trustees. However, the major stumbling block is the wage bill. Whilst money can be made available for transfer fees, the wages of any signing must be covered by the clubs income - and the fact that any significant addition to the squad could increase our wage bill by up to £2-£3m a year is a major issue. The wage bill, as we know is currently an area that the club are concerned about and its currently taking up too high a percentage of income. In basic terms as I understand it there is not a major problem in funding transfer fees - the problem is that there is no "headroom" on the wage bill to take on extra players.

Money put into the club by the Trust:

On a final but very significant note, anyone questioning the support of the Trust over the years should bear this in mind. When Rovers were relegated the impact on the accounts was lethal, an operating loss of nigh on £50m in just two years. This would be enough to send most clubs under, however Rovers continued to operate normally, holding onto most of their players and paying premier league wages whilst in the champsionship, as well as remaining active in the transfer market. What enabled them to do this? Just stop an think logically for a minute, a £50m black hole in two years is a frighteningly serious situation, and if it wasnt for the Trust plugging this black hole Rovers could well have gone pop. Couple this with the interest free non-repayable loans and other donations, operating losses in other years that are written off by the Trust, the actual amount of money they have has put into Rovers is staggering.

Hopefully this will help people understand the ins outs of things.

Might be helpful to repeat this.

[Paul]

The Trustees HAVE been generous - the key is in the past tense. Now they are tightening the strings and putting an unrealistic value on the club. They try to have it both ways but by doing so they are inviting a large loss and nothing to salvage when the club is relegated. Lucky for us and them that MH leaving has been deferred yet again.

I think you'll find this is untrue. I haven't time to look it up but I recall the net book value of the club is around £45m in the 06 accounts. It was rumoured the club and Dan Williams were talking about a takeover in the region of £55m? I think Dan Williams offered something like this figure. If it is the true figure it's cheap for a PL football club.

Now once we step into the realm of "net book value" I'm on shaky ground but I have always understood this to be the basic value of a company. Perhaps philip can comment?

[stuwilky]

But not any more it seems.

And that's not wanting to detract in any way from what they've done in the past.

Rev, Im not commenting on what is or is not happening now - it is well documented.

The trustees can not be accused of being greedy. Surely even you can agree with that statement.