[Archived] BRFCS Podcast #69: Venkys London Ltd 2013 Accounts

[Guest Wen Y Hu]

In Podcast 69 BRFCS editor Wen Y Hu is joined by accountant Andy Neil (FernhurstRover) and financial expert philipl to discuss the Venky's London Ltd 2013 accounts, while Paul of the Rovers Trust joins briefly to make an announcement about the successful application to register Ewood Park as an asset of community value.

The podcast is published to the front page here.

It is also available via the following link. Just paste the link into your browser address bar.

http://brfcs-podcast.brfcs.com/BRFCS-069.mp3

[Muddboy]

An interesting listen – thanks to Philip, Andy and Wen for giving up their time.

Thank god for the Bank of India and old man Venky for deciding to give loads of land to bling boy!

[philipl]

Thanks to wen for all his sterling work behind the scenes. Skype certainly had more than a few Microsoft moments during this particular recording.

Having listened to the podcast, Fernhurst Rover and I do get a little accounting technical without explaining our terms as clearly as we and Dan have done in the past.

So I will keep an eye on the thread and will answer any points of clarification asked.

[footypix]

How real is the prospect of the club going out of business, before the start of next season?

[McClarky]

Interesting and worrying stuff. Thanks for the update though. A real shame that GB and his young squad and making every effort to get the club back up to where it came from with all this skulduggery going on in the background. I wonder at what point the plug will be pulled though, if we're doing OK at mid-year will they say well we might get back up so let's make an effort or will it be a case of selling the family silver (Rhodes). I suppose Venkys attitude to such a calamitous failure will be the main driver, i.e. are they willing to take the humiliation of abject failure or will they try and turn things around and see this season as the only chnce to do that. Never before has every game been so vital.

[JAL]

Interesting podcast guys for clarification when these accounts were put forward did the owners not say that they would cover the next 18 month period and then revue the situation or words to that affect.

Could you please clarify this cheers JAL.

[philipl]

I have copied the Going concern words from the Accounts but I cannot get them to paste here.

[PLJPB]

My reading of the accounts is that since day 1 Venkys have put in £66m (share capital & capital contributions into Venkys London).

As at 31st March 2013 Blackburn Rovers (the club NOT Venkys London Ltd) owed £30.7m to Venkys London plus another £15.285m to the Indian Bank.

I.e. If the Bank wants its £15.285m back it knocks on the club's door first. Also £5m of this £15.285m was borrowed before 31st March 2013 against the August 2013 parachute payment installment.

Do you think my understanding is correct Phillipl?

[OJRovers]

That's how I read it - the debt is in the club's books, not VLL. But I think they are secured on Indian assets.

I've just looked up the Economist article, worth a read.

[AndyNeil]

For reference, this is a link to the article published in The Economist and referred to in the podcast >>http://www.economist.com/news/international/21581724-football-clubs-can-easily-be-used-stealing-machines-here-instruction-manual<<

Imagine if the author was using Rovers as an example...

[PLJPB]

That's how I read it - the debt is in the club's books, not VLL. But I think they are secured on Indian assets.

I've just looked up the Economist article, worth a read.

I can't see any reference to Indian Assets security in the accounts but it does say: ''The bank loan and overdraft are not secured over any of the group's assets, however the bank reserves the right to ask for a debenture charge over the assets of the group during the life of the facility''

It does seem strange that the bank gave £15m of loans without any security so perhaps the suggested Indian Asset security has been done on a hand-shake!

[PLJPB]

For reference, this is a link to the article published in The Economist and referred to in the podcast >>http://www.economist.com/news/international/21581724-football-clubs-can-easily-be-used-stealing-machines-here-instruction-manual<<

Imagine if the author was using Rovers as an example...

Very enlightening article...........

[footypix]

so VLL buy the club, clear the historic debt....sell £45m of players and 3 years later the club is in £45m of debt...

The remaining players of value will need to be sold in January for the company to continue trading in the short-term.

Serious questions need to be asked about the short and long-term viability of the football club.

[barry_]

Serious questions need to be asked about the short and long-term viability of the football club.

You can ask but you won't get any answers.

[Stuart]

As at 31st March 2013 Blackburn Rovers (the club NOT Venkys London Ltd) owed £30.7m to Venkys London plus another £15.285m to the Indian Bank.

What happened to the notion that the club couldn't have Indian bank loans secured against it? Some kind of rule about the assets and bank must be in the same country? Another BRFCS myth-cum-fact?

[SIMON GARNERS 194]

You can ask but you won't get any answers.

Calamitous,foolish and ignorant ownership.

Never before have the supporters of this proud club felt like the condemned man waiting for the guillotine to fall.

From the loving caring ownership of Jack Walker to these bunch of pillocks... YE GODS!!!!!!

[Bucksrover]

Don't worry about the finances - my girlfriend ruined my rovers shirt in the wash so I will be chipping in another £40.

[JAL]

For reference, this is a link to the article published in The Economist and referred to in the podcast >>http://www.economist.com/news/international/21581724-football-clubs-can-easily-be-used-stealing-machines-here-instruction-manual<<

Imagine if the author was using Rovers as an example...

Reading this the first question is does it show how much tax has been paid by the club in its accounts ?

[Sparky Marky]

They'd be better off actually opening a few of them Xprs outlets in the UK now while everyone forgot about us. The concept is amazing and I'd like to have the option of an Indian McDonald's on my high street. I think that was the original plan but the PR was shocking....I bet Chaddy would be first in line for a tandoori lollipop.

[Blue n White Rover]

They'd be better off actually opening a few of them Xprs outlets in the UK now while everyone forgot about us. The concept is amazing and I'd like to have the option of an Indian McDonald's on my high street. I think that was the original plan but the PR was shocking....I bet Chaddy would be first in line for a tandoori lollipop.

Ha Ha Ha! Brilliant!

[Leonard Venkhater]

Excellent, if very dark podcast.One slice of good news about debts being set against Indian land assets.I'd have to listen a good few times to grasp the detail but the general message seems clear.

That question again: why do Venky's stay involved when they appear to be losing so much money? Hmmmm..cue .more conspiracy theories etc, but what does anyone expect in the face of silence and refusal to engage.Something is rotten in the state of Denmark etc. And even Breaking Bad has a chicken firm front for gangsters money laundering drug money!

To mix metaphors badly, it looks like the on the pitch stuff is improving, but there is real danger "under the water".

If the A word really does have to come, personally I would rather it was sooner than later and we can rally around building a future.

Some people have so much to answer for!

[perthblue02]

Thanks Wen, Phillip and Andy for an interesting podcast. Illegal gambling is very big in some parts of India as well as gold smuggling but can not see Mrs D, her Hubby and the confused one having anything to do with that. Good to know we have a reputable organisation like the FA weeding out the scum and protecting football themselves ,their approved agents and ex business partners.

[darrenrover]

Very informative podcast guys, thank you.

I think the phrase 'sh-t or bust' possibly best sums up our position.

Of interest is the comment that was mentioned earlier in the thread and was my understanding, that Venkys had stated that they were prepared to bank roll the club for a further eighteen months and then take a further view. Andy and Philipl, is that your understanding too?

[philipl]

There is a going concern section in the parent company accounts which addresses these issues and yes, there is a commitment by the four owners to support VLL and its subsidiary.

It is when the Rovers accounts are published that the going concern support disclosure becomes directly meaningful. Legally VLL could let Rovers go into administration and still be a going concern on its own.

[TBTF]

There is a going concern section in the parent company accounts which addresses these issues and yes, there is a commitment by the four owners to support VLL and its subsidiary.

It is when the Rovers accounts are published that the going concern support disclosure becomes directly meaningful. Legally VLL could let Rovers go into administration and still be a going concern on its own.

And the popular opinion is that because Rovers accounts go up to 30th June ( rather than 31 March as per VLL) that some negative financial things went on in the intervening period, the Rovers FC accounts will be a sight worse than the VLL losses were.The Trust seem to think that may be as much as £40 million losses-is that a fair summary??

If so and looking at whats emerging tonight about FFP and fines and transfer embargos from the Shelf himself then it really does look like Promotion or bust.Especially with parachute payments dropping by half next year.

Arguably the most depressing news out of it all is that they actaully expect FFP sanctions-in other words despite all this ridding of so called high earners , we continue to bleed cash .WE are still losing money at an alarming rate by the sounds of it.

Truly scary stuff .Even with things looking up on the playing front we dont exactly look like promotion bankers to be fair. And then what ????