Venkys London Ltd accounts

[cesus]

Just now, blueboy3333 said:

£250m put in by Venkys and people think theres a queue of local businessman ready to step in and save the club?

It’s complete and utter madness. I always say if I had £100m and Venkys gave me the club debt free, my cash would run out before the club could self sustain, how as fans can we ask people to spend that money. Some long hard questions need to asked of how much is being taken out of the game by players, managers and agents.

[JHRover]

Just now, blueboy3333 said:

I said the same yesterday but apparently that is 'incorrect' according to @old darwen blue. He knows some local Billionaires who are going to give Venkys all their money back and take over the club. ?

We'll probably never know the answer if Venkys refuse to even pick up the phone when someone tries to get them round the table 

[pk1875]

The Club as we know it, will die at some point and it will be down to Venky's and their corrupt cohorts, make no mistake. The figures have been unbelievable for a good few years now. They set the rot into the club and it's now beyond repair. It is a case of when not if.

[blueboy3333]

Just now, JHRover said:

We'll probably never know the answer if Venkys refuse to even pick up the phone when someone tries to get them round the table 

Well we know what Battersby and his mate were offering and it wouldn't have bought the club shop.

[tomphil]

It's an accounting tool the figures will always make for uncomfortable reading whilst they own it but it'll never damage them whilst they are raking it in elsewhere in their empire but the club itself will never prosper.  I wish people would wake up to this, it's a handy oversees loss making entity to have on the books that one day might return millions if needed but it doesn't really matter in the meantime.

Sadly as pointed out run that way the club LIKE MANY OTHERS is reliant on ownership funding to compete at this level, oh and the BOI who seem to be doing alright out of it as well....

[blueboy3333]

2 minutes ago, tomphil said:

It's an accounting tool the figures will always make for uncomfortable reading whilst they own it but it'll never damage them whilst they are raking it in elsewhere in their empire but the club itself will never prosper.  I wish people would wake up to this, it's a handy oversees loss making entity to have on the books that one day might return millions if needed but it doesn't really matter in the meantime.

You might be right. What are the tax rules around loss-making in another country and how does this correlate with what Venky's are doing at Rovers?

[tomphil]

Just now, blueboy3333 said:

You might be right. What are the tax rules around loss-making in another country and how does this correlate with what Venky's are doing at Rovers?

It must have some kind of advantages but at the very least it will show up on their books over there as a loss making oversees entity that needs propping up by 10/20 million per year, regardless of its own turnover.  So it'll be swallowing up on paper a big lump of group profits although i'm sure when big Baz is over here and wants a bit of ready cash for expenses or some other European venture he can conjure it up no bother..

[JHRover]

 

26 minutes ago, tomphil said:

It's an accounting tool the figures will always make for uncomfortable reading whilst they own it but it'll never damage them whilst they are raking it in elsewhere in their empire but the club itself will never prosper.  I wish people would wake up to this, it's a handy oversees loss making entity to have on the books that one day might return millions if needed but it doesn't really matter in the meantime.

Sadly as pointed out run that way the club LIKE MANY OTHERS is reliant on ownership funding to compete at this level, oh and the BOI who seem to be doing alright out of it as well....

Whatever it is you have to assume that it isn't causing them much pain. If it was they'd have walked away by now, because they certainly aren't in this for sporting/profile reasons.

You'd think any company alarmed by continually pumping £10-20 million per annum into a black hole on the other side of the world would parachute in industry experts to get on with running the club properly and with autonomy to make big decisions. Alas it seems they're still wanting to run the show themselves in their own bonkers way. So either the penny hasn't dropped after £150 million or alternatively they aren't bothered in the slightest. Nobody feeling the pain would just allow the circus to roll on every year.

[PLJPB]

2017/8 season BRFC Ltd accounts now filed at Companies House. The league 1 promotion season came at a cost of a loss of £17 million in the accounts.

[Herbie6590]

18 minutes ago, blueboy3333 said:

You might be right. What are the tax rules around loss-making in another country and how does this correlate with what Venky's are doing at Rovers?

They will be able to offset Rovers losses against tax.

[Herbie6590]

45 minutes ago, tomphil said:

It's an accounting tool the figures will always make for uncomfortable reading whilst they own it but it'll never damage them whilst they are raking it in elsewhere in their empire but the club itself will never prosper.  I wish people would wake up to this, it's a handy oversees loss making entity to have on the books that one day might return millions if needed but it doesn't really matter in the meantime.

Sadly as pointed out run that way the club LIKE MANY OTHERS is reliant on ownership funding to compete at this level, oh and the BOI who seem to be doing alright out of it as well....

Interest paid has reduced by two thirds in the last two years from £1.5m to £400k reflecting reduced dependency on external borrowing 

[Herbie6590]

Just now, MCMC1875 said:

#VenkysOut

Who in ? 

[Bigdoggsteel]

Wages 187% of turnover isn't sustainable. Is that just because we were in league 1?

[blueboy3333]

Just now, Herbie6590 said:

They will be able to offset Rovers losses against tax.

I was just asking for the detail? How does this work across different countries with different tax rules? 

[blueboy3333]

13 minutes ago, JHRover said:

 

Whatever it is you have to assume that it isn't causing them much pain. If it was they'd have walked away by now, because they certainly aren't in this for sporting/profile reasons.

You'd think any company alarmed by continually pumping £10-20 million per annum into a black hole on the other side of the world would parachute in industry experts to get on with running the club properly and with autonomy to make big decisions. Alas it seems they're still wanting to run the show themselves in their own bonkers way. So either the penny hasn't dropped after £150 million or alternatively they aren't bothered in the slightest. Nobody feeling the pain would just allow the circus to roll on every year. 

Why would they walk away when Rovers owe them close to £250m? They only way they'll see any of that that money again is if we get in the Prem and they can take back a big chunk of the £150m TV money. 

[tomphil]

1 minute ago, Herbie6590 said:

Interest paid has reduced by two thirds in the last two years from £1.5m to £400k reflecting reduced dependency on external borrowing 

No doubt helped by income from player sales they don't appear to pump money in to reduce external debt the club seems to have to fund that itself.

[JHRover]

An example of their couldn't care less attitude - in more than 8 years of ownership I'm not aware of a single sponsor/deal with a company or business that the club has benefited from that has been brought by Venkys involvement. Not a single one. Not a single advertising board, partnership, shirt sponsor. In 8 years+. It might be loose change in the scheme of things but if they'd have used their no doubt extensive contacts in Asia to bring other partners and sponsors to the table the club could have generated higher revenues, helping with FFP and reducing their 'investment'. Yet there's been nothing. Once again the only assumption to be made is they either don't want it or don't care - and from there the well of sympathy runs dry.

You've got admittedly improved efforts on the ground in Blackburn to try and develop more business and corporate links after 6 years of complete neglect, and yet we've supposedly got the biggest poultry/pharmaceuticals firm in India owning the club and not once have we benefited from that by bringing big players into the sponsorship of the club.

Before anyone says 'but no big companies would be interested in sponsoring a Championship club' I suggest you go and visit some websites of rival clubs and look at large international companies that do sponsor Championship clubs, many due to who the owner is.

[JHRover]

Just now, blueboy3333 said:

Why would they walk away when Rovers owe them close to £250m? They only way they'll see any of that that money again is if we get in the Prem and they can take back a big chunk of the £150m TV money. 

If they are fed up with pouring money in every year the only alternative is to walk away. This is what happened at Wigan with Whelan and Bolton with Davies. When the end point came they walked away, wrote off their investment and left the club to someone else. Venkys will never get £250 million back from Rovers.

How do Rovers owe them close to £250 million? I thought it was about £150 million?

 

[tomphil]

They wanted the club for publicity but the first plans went awry but now annually they are publicised as wealthy generous benefactors propping the club up, i'm sure that does them no harm in certain quarters.

Every time we are on SKY it gets rammed down the throats several times per match, 'Venkys keep pumping in x million, badly advised etc etc'

Not exactly bad publicity is it.

[RoverCanada]

Haha, so my estimates from awhile back were only about £10m off in terms of our losses... Wages didn't drop as much as I thought (although there appears to be an odd £450k jump in pension costs in 17/18, which may be a one-off?) and matchday fell further than I thought, even though average attendance actually went up (I think the latter may be due to not having a lucrative FA Cup game with Man U). A couple other kinks are our operating expenses were quite suppressed in 16/17 due to 'one-off charges to Venkys London'. So they rose from £5.9m to £8.9m, but this is still a decline from £10.7m two years ago, so trending downward.

Also, we stopped selling players. We made £9.8m in player trading profits last year. Only £300k last year.

Ignoring 'intangible fixed asset (player) trading' and adjusting other expenses, our operating losses were more like £16.9m in 16/17 versus £16.7m last year. £17.5m in 16/17 vs £17.1m in 17/18 if you include interest payments.

So, Venky's essentially 'sanctioned' the same level of operating losses last year to secure promotion. We were the heavy hitters of League One obviously... but now we're back to being relatively small minnows. Probably back up to ~£16m turnover this year. Wages maybe up to £20m? Both of which would put us in the bottom third of the Championship...

Just now, JHRover said:

An example of their couldn't care less attitude - in more than 8 years of ownership I'm not aware of a single sponsor/deal with a company or business that the club has benefited from that has been brought by Venkys involvement. Not a single one. Not a single advertising board, partnership, shirt sponsor. In 8 years+. It might be loose change in the scheme of things but if they'd have used their no doubt extensive contacts in Asia to bring other partners and sponsors to the table the club could have generated higher revenues, helping with FFP and reducing their 'investment'. Yet there's been nothing. Once again the only assumption to be made is they either don't want it or don't care - and from there the well of sympathy runs dry.

You've got admittedly improved efforts on the ground in Blackburn to try and develop more business and corporate links after 6 years of complete neglect, and yet we've supposedly got the biggest poultry/pharmaceuticals firm in India owning the club and not once have we benefited from that by bringing big players into the sponsorship of the club.

Before anyone says 'but no big companies would be interested in sponsoring a Championship club' I suggest you go and visit some websites of rival clubs and look at large international companies that do sponsor Championship clubs, many due to who the owner is.

Fair points, but something to keep in mind is I think Venky's have been pumping about £4m of turnover into the club themselves via commercial sponsorship. Commercial turnover dropped from £4.9m to £4.3m last year, not surprising, but ~£5m in commercial revenue actually had us hitting above our weight at 'mid table' in the Championship. Perhaps knowing we had an 'automatic' decent commercial revenue stream bred complacency, but also need to consider Venky's' sponsorship crowds out a lot of other potential sponsorship. As you say, seems to be some improvement in that regard this year...

Edited March 21, 2019 by RoverCanada

[blueboy3333]

Just now, JHRover said:

If they are fed up with pouring money in every year the only alternative is to walk away. This is what happened at Wigan with Whelan and Bolton with Davies. When the end point came they walked away, wrote off their investment and left the club to someone else. Venkys will never get £250 million back from Rovers.

How do Rovers owe them close to £250 million? I thought it was about £150 million?

 

PriceOfFootball

 

@KieranMaguire

·

3h

 

As well as owing Venkys £108 million in loans the owners have invested £147 million in shares taking total past the £1/4 billion mark.

 

 

[Herbie6590]

2 minutes ago, blueboy3333 said:

I was just asking for the detail? How does this work across different countries with different tax rules? 

The short answer is it depends....which countries, what tax legislation & cooperation agreements are in place & to a lesser extent how good their accountants are. Simplistically, subsidiaries making losses offset those losses to reduce the parent company tax bill. 

This is normal practice for multi national companies and is why accountancy firms have teams dedicated to optimising this for their clients...at a price.

[JHRover]

Just now, RoverCanada said:

Haha, so my estimates from awhile back were only about £10m off in terms of our losses... Wages didn't drop as much as I thought and matchday fell further than I thought, even though average attendance actually went up (I think the latter may be due to not having a lucrative FA Cup game with Man U). A couple other kinks are our operating expenses were quite suppressed in 16/17 due to 'one-off charges to Venkys London'. So they rose from £5.9m to £8.9m, but this is still a decline from £10.7m two years ago, so trending downward.

Also, we stopped selling players. We made £9.8m in player trading profits last year. Only £300k last year.

Ignoring 'intangible fixed asset (player) trading' and adjusting other expenses, our operating losses were more like £16.9m in 16/17 versus £16.7m last year. £17.5m in 16/17 vs £17.1m in 17/18 if you include interest payments.

So, Venky's essentially 'sanctioned' the same level of operating losses last year to secure promotion. We were the heavy hitters of League One obviously... but now we're back to being relatively small minnows. Probably back up to ~£16m turnover this year. Wages maybe up to £20m? Both of which would put us in the bottom third of the Championship...

I thought Waggott said we were mid-table or top 10 for wages in the Championship?

[Herbie6590]

Just now, tomphil said:

No doubt helped by income from player sales they don't appear to pump money in to reduce external debt the club seems to have to fund that itself.

This is not so, interest payable to the bank is clearly dependent upon borrowings. You reduce the borrowings, you reduce the amount of interest payable. Interest payable has reduced dramatically (roughly two thirds) so in a stable interest rate environment, average borrowings must have reduced similarly.

Venkys have reduced external debt & funded more themselves interest free, that’s why the bill has reduced.

Funds from player sales are part of income. They are shown in the accounts. 

Venkys fund our losses from their funds, I’m not quite sure how you arrive at the conclusion that they “don’t appear to pump money in to reduce external debt” when the numbers point to exactly the opposite ?

BTW, I say this every time the accounts are updated...I am no Venkys apologist but if we are going to criticise them, let’s do it based on facts because it makes for a valid argument.

[JHRover]

Just now, blueboy3333 said:

PriceOfFootball

 

@KieranMaguire

·

3h

 

As well as owing Venkys £108 million in loans the owners have invested £147 million in shares taking total past the £1/4 billion mark.

 

 

So we owe them £108 million then. You can't 'owe' your owners share capital. That money has been invested. They aren't getting it back and if they think they are they're in for a wait.