Blackburn surge into profit, but challenges lie ahead
PREMIER League football club Blackburn Rovers surged into profit last year on the back of record turnover, but chairman John Williams warned of more difficult times ahead.
The club said the new TV deal between BSKyB, Sentanta and the BBC, and last season’s 7th position in the league had off-set lower match-day revenues as the previous season had seen the club enjoy good cup runs.
In the year to June 30 2008 Blackburn Rovers – currently third from bottom in the Barclays Premier League – saw turnover jump from £43.3m to £56.3m, while pre-tax profits came in at £3m, against a £3.4m loss in the 12 months to June 2007.
Operating profits, before player trading, capital expenditure and finance charges came in at £6.6m, compared with a £3.3m loss in 2007.
After a 25% cut in ticket prices match-day revenues fell from £8.9m to £6.1m, while commercial revenues dipped too, from £10.4m to £8.9m. Media revenues were the major driver of turnover growth with income soaring from £23.8m to £41.2m.
Mr Williams said season ticket numbers for the current season were down 7%, despite a freeze on prices: “The economic climate is difficult. We operate in a small, relatively impoverished town, and clearly there is a limit to how successful we can be using price as a driver.”
As with all clubs, Blackburn saw its wage bill rise, from £31.2m to £34.8m as players were signed to new deals and new players were signed. In the period the major transfers included the capture of star striker Roque Santa Cruz from Bayern Munich.
The figures include an unspecified amount of compensation, believed to be around £4m, from league rivals Manchester City after Blackburn’s manager Mark Hughes, and many of his backroom team, left to join City.
Blackburn, which is still owned by the trustees of its former benefactor, the late Jack Walker, said the trustees had been persuaded to restore a £3m loan payment for this season.
With ownership in mind, Mr Williams said the club had struggled to bring new investment into the business.
“Work continues to find a new owner for the club. Having discontinued their annual £3m funding to turnover in 07/08 the trustees have been persuaded to make a £3m loan for our 08/09 campaign.
“So far the search for new investors has drawn a blank, although behind the scenes the trustees’ advisers continue with their work…The unfavourable economic climate continues to add to the stalemate.”
Since the year-end, and with the club struggling in the league, Blackburn sacked Mark Hughes’ successor Paul Ince, and replaced him with former Bolton Wanderers’ boss Sam Allardyce.
Concluding his statement, Mr Williams said Premier League survival and support from the Walker trustees was key to Blackburn’s fortunes: “So long as we can preserve our Premier League status the club is stable but without funding from our owner we are inevitably moving from a trading club to a net selling club. It is the simple economics of a club with a small fan base.”
