BLACKBURN Rovers’ parent company Venky’s London Limited (VLL) reduced losses by more than £30m in its annual accounts, in which the owners have once again re-iterated their commitment to the club.
VLL, which owns a 99.99 percent stake in Rovers, recorded losses of £2.8m in the financial year ending March 2016, compared with £35.1m in the previous year.
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That was helped by a £17.3m profit on player sales with the big-money departures of Jordan Rhodes and Rudy Gestede helping improve figures. Rovers lost £5.4m loss on player sales in the previous year.
Loans from the Venky’s to Rovers now total £121m and the owner’s say they remain committed to the football club and their aim of bringing Premier League football back to Ewood Park.
Venky’s also admit that VLL will need ‘significant funding’ in the year ahead but confirm that their parent company, Venkateshwara Hatcheries Pvt. Ltd, will be able to provide financial assistance.
During the last accounting year, £23.4 million was also converted from reserves to further share capital which now stands at £123m.
Rovers reduced the wage-bill to £28.2m from £30.9m 12 months earlier, however, figures showed that the wage to turnover ratio was 129 per cent, meaning for every £1 received, almost £1.30 was spent on wages.
That was up slightly from 128 per cent the previous year.
Turnover fell from £24m to £20.8m, not helped by a fall in the average attendance from 14,930 to 14,129, as Rovers finished last season 15th in the Championship.
But the accounts confirm that the club were compliant with Financial Fair Play (FFP).
“The focus of the company has again been for the football club to obtain promotion back to the Premier League, and become compliant with FFP (Financial Fair Play),” said directors Anuradha Desai, Venkatesh Rao, Balaji Rao and Jitendra Desai in the accounts.
“Further significant changes were made to the playing squad to reduce ongoing costs, whilst at the same time reducing the average age of the playing squad, and increasing its potential re-sale value.
“The reduction in turnover was due to a further reduction in the share of parachute payment received by the club.
“Operating expenditure for the year also reduced, wages and salaries reduced, and other operating costs significantly reduced.
“Compliance with Championship Football Fair Play (FFP) regulations will challenge all football clubs as they try to manage finances, such that they operate within income levels.
“The focus for Blackburn Rovers has to be on striving for promotion back to the Premier League, but also working to increase revenue streams back up to a level that will allow them to achieve this.
In their forecasts for 2017, the accounts state: “The group will require significant funding in addition to the current facilities available to the group.”
However, they add that the directors have received confirmation from their parent company, Venkateshwara Hatcheries Pvt. Ltd, that “it has sufficient funds and is willing to provide such additional funding as may be required to fund the group.”
That is regardless of whether the bank facility, provided by the State Bank of India, which is due for renewal in March 2017, is approved.
While Venky’s state the short term financial performance of Rovers has been “volatile”, the owners believe the value of their investment has increased since the previous financial year.
They added: “The company is committed to support the subsidiary (Rovers) going forward and is confident of its growth and continued improved performance.”
The accounts also include a note that after March 31 2016, the date of which the accounts run to, Rovers received £10.875m in transfer fees through the sale of central defenders Shane Duffy to Brighton and Grant Hanley to Newcastle United.