The Political Economy of Football V2

The authoritative Swiss Ramble applies his forensic financial skills to the case of Blackburn Rovers.  Few football fans have suffered as much as those in Blackburn from owners who have no clear strategy.   Coventry City suffered in the same way until a local businessman took control, but Blackburn have a huge debt pile. Venky's are the largest poultry integrator in Asia.   T hey handle everything from breeding, hatcheries, and feed to processed chicken and animal health products.    This is a smart market to be in as chicken is often the first meat consumed in middle income countries as they become more prosperous. Presumably when they bought Blackburn they saw it as adding to their profile and prestige, hope for a return to the Premier League.  However, this would require much more investment than they have been willing to provide. It will take a lot for the bad vibes around the club to go away, given the many issues faced by Rovers. Indeed, l...

Football finance guru Kieran Maguire says that the £10m loss at Blackburn is not that bad (particularly when you compare it with other Championship clubs not receiving parachute payments:  https://www.bbc.co.uk/sport/football/articles/c1d9013y4zdo Maguire says that owning a football club is a bit like being the bank of mum and dad.  I know what me means, except in my case it's the bank of step-grandad, grandad and great-grandad!

Football finance guru Kieran Maguire reviews the accounts of Blackburn Rovers and says that they relied on player sales of nearly £2m. reflecting a trend across the Championship:  https://uk.sports.yahoo.com/news/football-finance-expert-gives-context-050000850.html?

Blackburn Rovers are one of England's historic clubs and one time Premier League title winners, but the club's fortunes these days are far from easy. Rovers had to cut back on spending after an Indian government agency prevented Venky’s, the club’s owners, from remitting money to the club, while it queried the application of funds by one of its subsidiaries. As a result, Venky’s had to apply for special approval to send money, which was granted, thus allowing the owners to provide £11m of funding before Christmas to cover day-to-day requirements, including wages, utilities and suppliers. Rovers’ pre-tax loss nearly doubled, rising by £9.7m from £11.2m to £20.9m, despite revenue rising £4.4m (26%) from £16.6m to £21.0m, mainly because profit from player sales dropped £9.7m from £10.1m to just £349k. All three revenue streams increased. Match day led the way, rising £1.6m (50%) from £3.4m to £5.0m, but there was also good growth in commercial, up £1.3m (28%) from £4.9m to £...

Blackburn parent company Venky’s London publishes accounts to 31 March 2023. Revenue £19.9m, up 16%.   Operating loss £21.5m up 5%.   Wages £130 for every £100 income (2022 £145).   Total losses under the Venky’s £204 million.     Player purchases £4.8m.   Overdraft £14.5m.

The Indian Government has pressured Venky's to cut their investment in Blackburn Rovers and a proposed 20 per cut has produced turmoil at the club:  https://www.mirror.co.uk/sport/football/news/jon-dahl-tomasson-blackburn-rovers-30480683 Tax rates on money sent from India are set to rise from five to 20 per cent:  https://www.lancs.live/sport/football/transfer-news/blackburn-rovers-tomasson-future-budget-27335121

Blackburn Rovers’ pre-tax loss increased by £4.6m from £6.6m to £11.2m in 2021/22, despite revenue rising £2.1m (15%) from £14.5m to £16.6m, mainly because prior year included £13m profit from the sale of the training ground. Rovers’ £11.2m loss was not great, but it was only middling for the Championship. Indeed, some clubs posted much higher losses, especially the three promoted to the Premier League in 2021/22 (Fulham £57.0m, Bournemouth £55.5m and Nottingham Forest £46.2m), partly because they included hefty bonus payments. Rovers’ loss would have been much worse without £10.1m profit on player sales, up from only £0.6m the previous season. This was largely due to the big money sale of Adam Armstrong to Southampton, though many senior players also left for free.   This was one of the best results in the Championship, though the two clubs that made the most money from player trading were WBA and Fulham. Rovers have only once made a profit under the Venky’s ownership, which...

Blackburn Rovers lost almost £400k a week in 21/22 but player sales almost halved the losses.  Player purchases just over £1m.  Player sales £10.5m.    Since end of 21/22 Rovers have had a net transfer spend of £4.4m. Blackburn total losses now total over £300 million, underwritten by shares and loans from the Venkys. Revenue was up due to matchday income returning following end of lockdown.   Media revenue down as less iFollow sales. Amortisation (transfer fees spread over contract life) similar to 20/21. Wages £146 for every £100 of income (not so unusual in the Championship). Wages average £11,300 a week. Blackburn are owed over £5m from other clubs for player sale instalments and owe £2.7m themselves. Small compared to the £144m the club owes to owners and £18m to EFL and bank

Blackburn parent company Venkys London had £20m loss to year ended 31 March 2022 but profits on sale of Armstrong and property assets to another Venky’s company turned this into a small profit, reports Kieran Maguire. Club issued £17m shares and borrowed £8m in the year to fund the losses. Blackburn income up 35% as crowds returned to Ewood. Interesting that also claimed £762k in grants (possibly furlough) and £562k in insurance claim (COVID?) in the year. Blackburn wages slightly down but still £146 wages for every £100 income. Blackburn bought players for £1.2m and had sales of £10.5m in year to 31 March 2022 Total losses made by Blackburn under the Venkys are almost £184m.

The authoritative Swiss Ramble provides authoritative and forensic analysis of club accounts from his Zurich fastness and today it is the turn of Blackburn Rovers. If you want a low score on Pointless for naming a Premier League champion, probably choose Blackburn Rovers.    It’s amazing to think that Indian conglomerate Venky’s have been in charge of this historic club for over ten years.    In their early stewardship they were an exemplar of getting everything wrong. Rovers looked as if they might mount a promotion challenge, but have faded a little recently.   I always enjoyed going there and it would be good to see them back in the top flight. A poor profit record Since Venky’s arrival in 2010, Rovers have only once made a profit – in 2012 when they were last in the Premier League (boosted by £23m player sales). Since then, they have managed to lose £165m in 9 years, despite benefiting from 4 years of parachute payments. Their loss narrowed by £15....

The tireless Swiss Ramble has been casting his forensic eye over the 2019/20 accounts of Blackburn Rovers. The club’s loss widened by £4m from £18m to £22m, as revenue fell £3.2m (19%) from £16.7m to £13.2m, while operating expenses grew £3.6m (10%), partly offset by profit on player sales rising £2.5m to £3.1m and £0.6m government furlough income. Since Venky’s arrival in 2010, Rovers have only once made a profit – in 2012 when last in the Premier League (boosted by £23m player sales). In this period they have lost £172m, some achievement considering they had two seasons in top flight followed by four with parachute payment. Debt increased by £14m from £142m to £156m, thanks to another loan from Venky’s, who the club now owe £141m. There is also a £14m bank overdraft (guaranteed by Venky’s) and a £0.6m loan from the EFL.    The £156m debt was the second highest in the Championship, only below Stoke City £187m. In fact, they actually had the 9th highest debt in England at ...

Indian conglomerate Venky's have been controversial owners of Blackburn Rovers and they certainly made some mistakes in the early days through a lack of understanding of English football.  However, they have recently put in another £7m to bring their total contribution to around £190m. They have got slim pickings in return with Blackburn solid in the Championship, but looking unlikely to get promoted.  Football finance guru Kieran Maguire dreads to think how the club would be placed if the owners pulled out:  https://www.lancs.live/sport/football/football-news/blackburn-rovers-venkys-analysis-finances-19824492

The authoritative Swiss Ramble has reviewed the 2018/19 accounts of Blackburn Rovers.  He notes, 'L oss widened by £1.4m from £16.8m to £18.2m, despite revenue increasing by £7.7m (86%) from £9.0m to £16.7m following promotion, as operating expenses grew £8.6m and profit on player sales fell £0.5m to £0.6m.' Main reason for the club's  £7.7m revenue growth was the higher TV deal in the Championship, which meant broadcasting almost quadrupled, rising £5.5m from £1.9m to £7.4m. There was also good growth in commercial, up £1.2m (28%) to £5.5m, and match day, up £1.0m (35%) to £3.7m. The club's r evenue growth was more than offset by the cost of competing in a higher division, as wages rose £5.6m (34%) from £16.8m to £22.4m, player amortisation nearly tripled from £0.8m to £2.2m and other expenses increased by £1.5m (20%) to £9.1m.  The £ 18m loss was the seventh worst in the Championship, though in fairness only seven clubs made money in this very competitive league. The ...

With a £18.2m loss in 2018/19 Blackburn Rovers are living dangerously according to football finance expert Kieran Maguire. They are reliant on Venky's for continued investment and fortunately they regard the club as a trophy asset. Their business is not badly affected by current disruption: Blackburn Rovers

The tireless Kieran Maguire has been up early looking at the latest filings at Companies House. Blackburn Rovers parent company Venky’s London publish results for year to 31 March 2019. The whole of the turnover is attributable to Blackburn Rovers. The club lost £20.3 million in year despite promotion to the Championship, which works out as £391k a week. Average income in the Championship is £31.4m, so Rovers are on less than half that, partly due to impact of parachute payments [which have such a distorting effect in the Championship]. The Blackburn wage bill in 2018/19 was the third lowest of the decade, average weekly wage £11,000 a week last season compared to division average of £16,000 a week. At £6.1m media (up from £2.9m in League One) accounted for 41 per cent of income; commercial at £5.2m accounted for 35 per cent; matchday at £3.6m accounted for 24 per cent. Lancs Live comments on the results here: Blackburn Rovers You can read the accounts online at: Venky's Lon...

Top football finance expert Kieran Maguire reviews how Birmingham City, Blackburn Rovers and Bolton Wanderers arrived at their present plight: The three B's As Maguire notes in relation to Birmingham City, 'Whoever chooses to take on the responsibility of running a Championship football club will realistically have to be prepared to pay out huge sums every month to keep the club afloat, in either an attempt to keep the club from League One, where clubs earn broadcast income of about £1m or achieve promotion to the Premier League where they can earn a minimum of £100m. But as we have seen with Birmingham, pushing the boat out too far can have consequences.

Blackburn's net losses in 2017/18 were more than twice that of any other club in League 1 last season and represent 67% of total losses of the division. Blackburn lost £336,000 a week in 2017/18 in League One. Blackburn paid £187 in wages for every £100 of income in 2017/18 in League One. Blackburn had the highest wages bill, average weekly wage and wage to income percentage in League One in 2017/18. Nevertheless, the overall wage bill was down 24 per cent. Following promotion back to Championship Rovers spent a net £7.6 million on transfers in 2018/19. Blackburn player trading 2017/18: purchases £867k sales £1.2 million.

Blackburn Rovers Holding Company Venkys London have announced losses of £15 million for 2017/18, when the club was in League 1 and promoted at the end of the season. The losses are a League 1 record. Blackburn total losses under the Venkys have been £124 million. Blackburn income was down £6 million mainly due to lower TV revenues in League 1 but still high by division standards. Blackburn wage bill was down £7 million to £15.7 million and 19 fewer employees. The wage bill is likely to be highest in division for 2017/18 and more than double the average. Venkys invested a further £19 million in the form of shares last season to keep Blackburn afloat.

This article from The Guardian considers the cases of Blackburn Rovers, Blackpool, Charlton Athletic and Coventry City: The Agony and the Ecstasy Two of these teams enjoyed promotion last season, but it's not just about results.

The accounts of Blackburn Rovers for 2016/17 do not make for happy reading with the effects of years of the Venky's regime all too evident to see. There have been £225m in losses over the years under their stewardship. You could buy a lot of chickens for that. Rovers were still in the Championship in 2016/17 and 45 per cent of their income came from media. This is anticipated to fall from £6.7m to £1m this year. In the preceding year it was £13.5m. Total income for 2017/18 is estimated at £6m. Last year the club was losing £262,000 a week. Match day income was slightly down at £3.3m. Commercial income fell from £5.06m to £4.47m. This is a reasonably good figure in relation to comparable clubs. The club has a £12m overdraft and owes £95m to Venky's. Since the club was relegated from the Premier League under the Venky's their borrowings have risen from £25m to £113m. They spent £147 on wages for every £100 of income in 2016/17, a worryingly high ratio.