It”s not Rover yet! Venky”s confirm they won”t walk away from doomed Blackburn
Venky”s insist they will continue to fund Blackburn Rovers even if the club are relegated from the Barclays Premier League after it posted an annual pre-tax loss of 18.6m.
The loss – for the year ending June 30, 2011 – compares to only 1.9m for the previous year, while net debt rose from 21m to 26.3m.
Rovers made a loss of 4.8m before player trading, which incurred a further loss of 13.8m.
Staying put: Blackburn Rovers” Venky”s owners Balagi Rao and Venkatesh Rao
Net transfer fees of 8.7m were due after the end of the financial year and were not included in the latest balance sheet.
A statement wsaid Blackburn would require ‘significant funding’ in the short term but that Indian poultry firm Venky’s, owned by Balagi Rao and Venkatesh Rao, had confirmed that they will provide that even if Steve Kean”s team are relegated from to the Championship.
The statement also confirmed that a number of players have clauses that would lead to significant reductions in their salary if Rovers went down.
Blackburn are currently rock bottom of the Premier League on just 11 points with manager Kean under continuous pressure from fans to step down.
“As part of the directors’ assessment of going concern they have prepared detailed cash flow forecasts for 18 months to the end of June 2013,” the statement said.
“These forecasts indicate that the company will require significant funding in addition to the current facilities available to the club.
Under pressure: Blackburn boss Steve Kean is feeling the strain at Ewood Park
“The amount of additional funding required will be dependent on the net proceeds of any player trading and availability of bank facilities.
“In view of this the directors have received confirmation from the ultimate parent company (Venkateshwara Hatcheries Pvt Ltd) that it has sufficient funds and is willing to provide such additional financing as may be required.
“The company is currently operating within its facilities provided by Barclays, which are due for renewal on June 30, 2012.
“The directors have started discussions with Barclays regarding the renewal of these facilities when they expire and based on these discussions the directors are optimistic these facilities will renewed on acceptable terms and conditions.”
Turnover dropped narrowly from 57.8m to 57.6m with wage and salaries increasing from 47.4m to 49.9m, leading to the wage to turnover ratio increasing from 82 per cent to 86.6 per cent – although that was still short of the figure of 90.6 per cent two years ago.