[Archived] Blackburn Rovers balance sheet

[Al]

I may be being stupid here but these accounts won't take into account paying off Berg (court settlement was May/June wasn't it!), Appleton, Murphy, Gomes, Pedersen & Givet will they?

Depends when the accounts were prepared. If the liability was known at the time it should have been reserved for in the accounts. I would have thought that the auditors would have insisted on it or qualified the accounts.

[Rover_Shaun]

So has the £27m been covered by Venkys or is it a debt to the bank?

Do they even have that kind of money to cover it?

[Al]

So has the £27m been covered by Venkys or is it a debt to the bank?

Do they even have that kind of money to cover it?

Need a full set of accounts to answer that including balance sheet, P&L, cash flow and notes to the accounts. Philipl is an expert on analysis of accounts. Maybe he will get a set and do some work for us. Too much hassle for me these days. I've been retired for too long.

[rovers_rob]

So for a numb nuts like me these losses are Rovers losses even though they are attributed to a holding company?

I'm with you on this. I don't understand it.

Think so. Paul explained it earlier - the holding company was set up for the sole purpose of BRFC.

To think how some fans thought relegation wouldn't be a problem and in some cases preferred it.

Andy Bayes said on radio Lancashire last night that he would try and get a comment from Derek Shaw (who was at the game).

When he asked Derek he replied that the club wouldn't comment because it isn't a Blackburn Rovers matter (or something like that).

What did Derek Shaw mean when he said that the club would not be commenting on matters that aren't BRFC related ?

[Rover_Shaun]

Read this on the LT website. Is it a fair assumption?

Venkys "continue to back the club" - they have NO CHOICE as the agreement with the bank of India is that Venkys mother company underwrites Venkys London Ltd depts and not the football club, ie when Venkys left Barclays and went to BoI - the bank they already bank with in India, the BoI no doubt saw that Venkys might wrack up huge debts with Venkys London Ltd and then walk away but they wouldnt give them the huge o/d they required this way and made them under write the Rovers o/d themselves - so from that point the club is at least safe.

So when the guilble "Venkys lovers" on here state "Venkys are great, they continue to fund us" - its because they have no choice - they have a legally binding agreement with the Bank of India which makes them do so.

[tomphil]

I'm with you on this. I don't understand it.

Andy Bayes said on radio Lancashire last night that he would try and get a comment from Derek Shaw (who was at the game).

When he asked Derek he replied that the club wouldn't comment because it isn't a Blackburn Rovers matter (or something like that).

What did Derek Shaw mean when he said that the club would not be commenting on matters that aren't BRFC related ?

Well it would seem Venkys own and run the holding company VLL and the holding company owns BRFC so you would presume any funding for Rovers comes through VLL. Can't see how it isn't a Rovers related matter.

[rovers11]

Debt is debt even if we make a smaller loss next season it doesn't go away. I realise everyone is enjoying a couple of good wins and the bad guys have left. This doesn't and shouldn't disguise the fact it is only Venkys guarantee to provide funds which allows Rovers to keep trading. If the funding stops we stop. Simple. Don't get complacent.

Same with any other club. It's part and parcel of football. The majority of football clubs spend well beyond their means and need wealthy owners to prop them up. We are no different. Where would Chelsea or Man City be without their wealthy backers?!

[den]

Same with any other club. It's part and parcel of football. The majority of football clubs spend well beyond their means and need wealthy owners to prop them up. We are no different.!

The majority spend well beyond their means?

Leeds did, as did Portsmouth. Which others?

Don't forget we're talking about a trading loss over 12 months here, not total debt.

[Parsonblue]

Same with any other club. It's part and parcel of football. The majority of football clubs spend well beyond their means and need wealthy owners to prop them up. We are no different. Where would Chelsea or Man City be without their wealthy backers?!

I'm not sure I would put the clowns in Pune in the same bracket as those who own Chelsea and City. I'm not convinced that many Championship club's are in the same state as ourselves in terms of debts and ongoing costs. The fact that we are no longer on the Premier League gravy train means that Venky's are going to continually lose money whilst they own us. The income streams are too small and the outgoings too large for it to be any other way. There is no money to be made owning a small town, mid-table to lower table Championship club. I suspect that at some point the penny will drop that they are unlikely to ever own "India's Premier League Club" and that regular meetings with Huddersfield, Barnsley, Charlton etc. is not going to hold much attraction for them in terms of impressing business associates. I suspect they already rue the day they first heard of Blackburn Rovers and had dreams of Champions League football.

[Paul]

Same with any other club. It's part and parcel of football. The majority of football clubs spend well beyond their means and need wealthy owners to prop them up. We are no different. Where would Chelsea or Man City be without their wealthy backers?!

There are none so blind............

I forget what the actual club debt is. Possibly £30-40m I'll look it up.

We haven't got any money. We don't have a squad good enough for promotion and if by some miracle we get promoted one of two things will happen:

Spend all the PL cash on paying off debt and trying to buy a good enough squad

OR

stick with existing squad, get relegated and trouser the PL cash

[rovers11]

The majority spend well beyond their means?

Leeds did, as did Portsmouth. Which others?

Don't forget we're talking about a trading loss over 12 months here, not total debt.

Which others?! You're probably better off asking which clubs didn't make a big loss last season. Have a look at the losses clubs made last season. Leicester lost £30m, I'm sure Forest made a hefty loss as did wolves, Bolton and so forth. Even my local club Brighton made an £8m loss and they have the highest attendance in the league. That's just the championship clubs. Prem clubs like Chelsea and City lose around £100m per year. Even the likes of Sunderland and stoke must lose fortunes.

Bolton`s total debt, for example, is huge but is covered by Eddie Davies. Chelsea`s and City`s debt is enormous but they are covered by their owners.

If Venkys pull out then yes we are in big trouble financially. But that's the same for the majority of clubs and why the FFP was introduced.

I'm not sure I would put the clowns in Pune in the same bracket as those who own Chelsea and City. I'm not convinced that many Championship club's are in the same state as ourselves in terms of debts and ongoing costs. The fact that we are no longer on the Premier League gravy train means that Venky's are going to continually lose money whilst they own us. The income streams are too small and the outgoings too large for it to be any other way. There is no money to be made owning a small town, mid-table to lower table Championship club. I suspect that at some point the penny will drop that they are unlikely to ever own "India's Premier League Club" and that regular meetings with Huddersfield, Barnsley, Charlton etc. is not going to hold much attraction for them in terms of impressing business associates. I suspect they already rue the day they first heard of Blackburn Rovers and had dreams of Champions League football.

I agree. They were certainly mis-sold the dream when buying Rovers. They certainly thought they could make money from Rovers, they don't any more. They don't seem to care about losing fortunes each season though.

[rovers11]

There are none so blind............

I forget what the actual club debt is. Possibly £30-40m I'll look it up.

We haven't got any money. We don't have a squad good enough for promotion and if by some miracle we get promoted one of two things will happen:

Spend all the PL cash on paying off debt and trying to buy a good enough squad

OR

stick with existing squad, get relegated and trouser the PL cash

We haven't got any money?! We've got one of the highest wage bills in the league, splashed out on 14 players this season, paid off several high earners and paid off several managers last season. I grant you, a lot of money has been wasted but I'm sure a lot of clubs would love to be as `skint` as we are.

Rovers don't have much money in terms of revenue but venkys do have a lot of money. Club debt is probably about £40m now but Venkys are responsible for paying off that debt as it is through the bank of India.

Premier league money is huge nowadays, we could pay off the debt and spend a bit of money in the transfer market. Not convinced we'll get promoted this season though.

The likes of Birmingham, Blackpool and Burnley have no money. They would love our budget.

[Rover_Shaun]

Oh dear

[den]

Which others?! You're probably better off asking which clubs didn't make a big loss last season. Have a look at the losses clubs made last season. Leicester lost £30m, I'm sure Forest made a hefty loss as did wolves, Bolton and so forth. Even my local club Brighton made an £8m loss and they have the highest attendance in the league. That's just the championship clubs. Prem clubs like Chelsea and City lose around £100m per year. Even the likes of Sunderland and stoke must lose fortunes.

Bolton`s total debt, for example, is huge but is covered by Eddie Davies. Chelsea`s and City`s debt is enormous but they are covered by their owners.

If Venkys pull out then yes we are in big trouble financially. But that's the same for the majority of clubs and why the FFP was introduced

Whoa, hang on a minute. You said "the majority spend well beyond their means" then name Leicester who lost £29m and Bolton. Both of which had owners who apparently are controlling those losses. Forest lost £12m and Brighton £8m, neither which measure up to rovers latest annual loss of very likely more than £30m.

The problem for me is that I'm not convinced that Rovers losses have been managed losses. By that, I mean planned for and at an acceptable level for the owners. You seem to be arguing that there is no problem because the owners are investing that money and will continue to do so. We don't know if there's any truth at all in that - do we? There is a viewpoint that rather than Venky's wanting to put money into the club, they are legally obliged to guarantee that debt. Now that's a very different situation if true. There's another problem here as well. How do they turn an annual loss of possibly £30m around within one year? Forest, with a £12m loss have a far better chance of turning that around, than we do. Not really comparable, is it?

[broadsword]

We haven't got any money, the players are being paid by the bank in effect, on the proviso that if the debt gets too large, the bank have Venky's by the balls. Our financial well-being is guaranteed by an indian company that churns out chicken nuggets.

It doesn't take Alan Sugar to see what's coming here.

Parachute payments go down by half from next season, then after 2 years, nothing. Expenditure is massively ahead of income, by a margin greater than that which was the purchase price of the asset. No future prospect of income shooting up to match expenditure (barring a miracle), so we're into cost control, you can't just cancel contracts and not pay a penalty. Add £27 mill onto what we already owed, shall we call that a total of 45 mill?

Then imagine a similar loss this financial year, somewhat mitigated by player disposals. Call that 25 mill.

Then 20 mill the year after, 15 the year after that.

A total debt of 100 mill in 3 years' time.

We'll be dead in the water long before such a state of affairs could happen.

Anyone want to argue the figures?

[rovers11]

Whoa, hang on a minute. You said "the majority spend well beyond their means" then name Leicester who lost £29m and Bolton. Both of which had owners who apparently are controlling those losses. Forest lost £12m and Brighton £8m, neither which measure up to rovers latest annual loss of very likely more than £30m.

The problem for me is that I'm not convinced that Rovers losses have been managed losses. By that, I mean planned for and at an acceptable level for the owners. You seem to be arguing that there is no problem because the owners are investing that money and will continue to do so. We don't know if there's any truth at all in that - do we? There is a viewpoint that rather than Venky's wanting to put money into the club, they are legally obliged to guarantee that debt. Now that's a very different situation if true. There's another problem here as well. How do they turn an annual loss of possibly £30m around within one year? Forest, with a £12m loss have a far better chance of turning that around, than we do. Not really comparable, is it?

Den, I agree with you that losing circa £30m is not sustainable and the owners have taken steps to address that - paying off high earners for one.

With the points you make about the losses being `planned` and `acceptable`, I agree that I don't think the owners think they acceptable hence my point above. However, I don't agree that it wasn't planned. Of course it was. They broke our transfer record last season and gave out massive contracts to players. Perhaps they didn't account for all the sackings but they certainly had planned for the majority of the losses. They knew, as did everyone, that we were losing £2m per month. We probably still are losing £££ per month but the owners don't seem bothered about losing money.

They can't possibly turn around a £30m deficit in one year without severely weakening the squad. That's why we'll have to be `creative` with our income to meet FFP. Also, those accounts only go up until March. Forest have invested heavily since then so I expect their losses to be closer to £20m this year.

The simple equation is, would people prefer Venkys didn't spend money and we perhaps scraped survival in this lge every year but have a healthy balance sheet. Or would they prefer Venkys to invest money, improve the squad and have a go at promotion but have an unhealthy balance sheet. As long as they cover the losses then I'd prefer the latter.

We haven't got any money, the players are being paid by the bank in effect, on the proviso that if the debt gets too large, the bank have Venky's by the balls. Our financial well-being is guaranteed by an indian company that churns out chicken nuggets.

It doesn't take Alan Sugar to see what's coming here.

Parachute payments go down by half from next season, then after 2 years, nothing. Expenditure is massively ahead of income, by a margin greater than that which was the purchase price of the asset. No future prospect of income shooting up to match expenditure (barring a miracle), so we're into cost control, you can't just cancel contracts and not pay a penalty. Add £27 mill onto what we already owed, shall we call that a total of 45 mill?

Then imagine a similar loss this financial year, somewhat mitigated by player disposals. Call that 25 mill.

Then 20 mill the year after, 15 the year after that.

A total debt of 100 mill in 3 years' time.

We'll be dead in the water long before such a state of affairs could happen.

Anyone want to argue the figures?

Not arguing with those figures but `an Indian company who churn out chicken nuggets` kinda gives your argument a little less credibility. They are successful business people whose total assets and personal wealth is most probably well in the billions. They are terrible at owning a football club but they are wealthy people.

Your argument rests on whether venkys stick around or not. We can all debate this until we are blue in the face but the simple fact remains that if venkys decide to up and leave then we are in big trouble. If they stay then we'll be covered by their money.

[ada2020]

We haven't got any money?! We've got one of the highest wage bills in the league -which is a curse not a blessing. splashed out on 14 players this season - most of which were not needed, paid off several high earners and paid off several managers last season - all of which now sits in that £30 million loss.

I grant you, a lot of money has been wasted but I'm sure a lot of clubs would love to be as `skint` as we are. - the only sane comment in this opening salvo.

Rovers don't have much money in terms of revenue but venkys do have a lot of money. Club debt is probably about £40m now but Venkys are responsible for paying off that debt as it is through the bank of India. - says who? I have no trust in that mob, do you?

Premier league money is huge nowadays, we could pay off the debt and spend a bit of money in the transfer market. Not convinced we'll get promoted this season though. - where is promotion coming from?

The likes of Birmingham, Blackpool and Burnley have no money. They would love our budget - really? All three teams far better than ours and at least two of them have a far healthier approach to operational budgets.

I have no beef with you buddy but I simply can't see any rosy glow to this news.

I nearly creased with laughter when someone mentioned FFP, bloody hell the clubs very existence seems to be at stake here.

What a complete @#/? mess. And the tossers have generated good sales on players. We are now in double the debt the club was in prior to being sold, without the vital premier league money.

[GanG2245]

off topic..

Saw this link last week...anuradha desai is mentioned a couple of times..

http://www.firstpost.com/business/nsel-scam-throws-spotlight-on-sharad-pawars-agri-forum-1055589.html

[Parsonblue]

The simple equation is, would people prefer Venkys didn't spend money and we perhaps scraped survival in this lge every year but have a healthy balance sheet. Or would they prefer Venkys to invest money, improve the squad and have a go at promotion but have an unhealthy balance sheet. As long as they cover the losses then I'd prefer the latter.

The problem with that is quite simple. What happens when they decide they have had enough of losing money and decide to pull the plug? A debt of £8 million would be difficult to manage but debts of £20, £25 or £30 million would be impossible and would leave the club facing the abyss. What happens if the Bank of India decide such losses can't be sustained and they withdraw their backing to Venky's? The whole future of the club is now in the hands of people who have no feeling for the club, it's history or the community it is linked with. At the end of the day accountants and bank managers in India will decide our future and having a squad capable of pushing for promotion is not likely to come into their calculations.

[John]

off topic..

Saw this link last week...anuradha desai is mentioned a couple of times..

http://www.firstpost.com/business/nsel-scam-throws-spotlight-on-sharad-pawars-agri-forum-1055589.html

Not for the first time, Desai linked with something which hardly reflects positively on her - what ever happened to her court case btw?

The losses weren't as big as I possibly thought however there is still a big worry that when the parachute payments dry up, there is little point (from their perspective) to hang around, then we really are scr**ed.

[Rover_Shaun]

Can I add that THEIR FATHER was a successful businessnan. He built the empire

[West Yorks Rover]

off topic..

Saw this link last week...anuradha desai is mentioned a couple of times..

http://www.firstpost.com/business/nsel-scam-throws-spotlight-on-sharad-pawars-agri-forum-1055589.html

The guy they were mainly talking about Pawar, did you see the comments underneath from a poster,

about his hidden assets etc, and if you added them all up he would be up - there with Bill Gates, Warren Buffet etc,

Someone told me ages ago that most wealthy Indians, don't ever let-on about their true wealth, I reckon the Rao

family could be far richer than a lot of people imagine, perhaps that's why Rovers' debts don't seem to worry them

too much, they certainly knock around with some high rollers.

Maybe we've been worrying for nowt.

Then again !!

[Rover_Shaun]

Well what are we worrying about then?

[West Yorks Rover]

Well what are we worrying about then?

Trouble is we'll probably never know if we're ok or not, until something happens, if owt happens, that is.

But I've decided not to worry and presume the baby is healthy.

[Rover_Shaun]

Its far from healthy. Its asthmatic with diabetes