After the finances of Venky’s London Limited (VLL) were disclosed, football finance specialist Kieran Maguire feels Blackburn Rovers are ‘under a lot of pressure’ with Financial Fair Play.
VLL is Blackburn Rovers’ parent business, and they disclosed their financial data up to March 31, 2023 earlier this week. It revealed that the club lost £20.8 million in the fiscal year.
Rovers generated a profit of 2.7 million the previous year, but it was due to the selling of Adam Armstrong and the owners exploiting a loophole to sell the Brockhall Senior Training Centre to themselves. Since then, the EFL has eliminated the prospect of an owner selling property to themselves to book against FFP.
Had Rovers not sold the training ground, they’d have still lost around £10m, even with the sale of Armstrong, again highlighting how financially dependant the club are on their owners. Of course, the same could be said for most EFL clubs, who are allowed to lose £39m under the EFL’s FFP guidelines.
“The previous year, they got out of jail free by selling the training ground because that was before the EFL changed the rules,” Maguire explained to The Lancashire Telegraph.
“You can no longer effectively sell property assets to yourself and book the profit against FFP losses.” They were forced to make the transaction, which gave them some breathing room.
“If you look at turnover versus wages, you wouldn’t run a business like that; it’s insane.” But that’s what they’ve done every season since taking over the club.
“They are not the absolute worst. You have clubs with sophisticated owners who understand money and are permitted to lose £20 million per year.
“From an FFP standpoint, they will be under a lot of pressure now.” The net transfer expenditure for the summer of 2023 was £20,000.00. They have a lot to juggle.”
The most recent financial statements provided some interesting insight into the club’s spending in 2023. Page 30 of the document contains information about events that occurred after March 31, up until the publication of the narrative.
This shows that Rovers spent a total of £20,000 in the summer transfer window. They signed two regular players, Leopold Walhstedt and Semir Telalovic, and sold Thomas Kaminski and Ash Phillips for about £4.5 million.
“If they hadn’t supported the club and it had been left to its own devices, they wouldn’t have been close to the play-offs last season,” Maguire said.
“They would not have made the progress they did, but £20 million a year, every year, is concerning.” They look to have reached their limit.
“I know people who have served on the board at Blackburn; they keep delivering in terms of cheques, which is what they require.” It’s unclear what the Venkys are getting out of this, but there’s been a lot of support.
“It is noticeable that they only put in £2m last season compared to previous years.” The loans repaid were greater than the funds invested, thus the club effectively had to break even.
“There has been no evidence of the owners putting any more money in from the post-balance events.”
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