The latest set of accounts for Salford City Reds 2013 Ltd, the company which owns Salford Red Devils rugby club, record losses of £5,142,778, with liabilities of £5,141,778.
The accounts, published today, are to January 2014, and reporting on the losses, the company's independent auditors, Mazars, state that "These conditions...indicate the existence of a material uncertainty which may cast significant doubt about the company's ability to continue as a going concern".
Turnover for the year was £2,298,378, while `Administrative Expenses' were a colossal £5,550,219, compounded by `Exceptional Administrative Expenses' of £1,585,327, which totalled the losses at £5,142,778.
The accounts report adds that financial forecasts for the company are "inherently uncertain in their nature" and will require more funds by owner Marwan Koukash. Indeed, the company only "meets its day to day working capital requirements through the financial support of Dr M Koukash, director, who has provided a loan in the period of £1,416,989". He has, according to the accounts, confirmed his financial support for "not less than 12 months from the approval of these financial statements" – which were signed on October 14th 2014.
Koukash has been vocal over the lack of support for the Red Devils, with only one thousand season tickets being sold for the forthcoming season. Fans are also stating on social media that they will not be buying the new shirt as it has `Lowry Outlet MediaCityUK Manchester' emblazoned on it by sponsors Peel Holdings.
Meanwhile, the controversial deal by Salford City Council and Peel Holdings to cover match day costs up to £164,000 and free rent at the AJ Bell Stadium is due to end before the new season starts.
The agreement that Koukash has to pay former creditors of the old Salford City Reds company is currently costing £327,804 per year (over £27,000 per month).
With such huge debts and losses, Salford people might well be concerned about the Salford Red Devils ability to pay off the outstanding £1.5million debt to Salford City Council which runs until 2038 (see previous Salford Star article – click here).
See also previous related Salford Star articles...
*Salford Mayor Backdates Salford Red Devils Gift - click here
* Public Money Scandal Rocks Salford City Council - click here
* Salford Red Devils Facing Bailiffs For Non-Payment of Kit Bill - click here
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