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Football-Aston Villa Announce Record Losses
Aston Villa announce record losses of £54m under Randy Lerner
• Villa losses worsened 42% in 2010-11
• Club sold Stewart Downing and Ashley Young for £37m
The Guardian UK
Randy Lerner continues to fund Aston Villa through holding companies in the UK and the United States. Photograph: Nick Potts/PA Archive/PA Photos
Aston Villa lost £54m in the year from 1 June 2010 to 31 May 2011, the club has announced. That is a record loss since the American credit card magnate Randy Lerner bought Villa in 2006, and the club's losses have deepened every year since. In the previous year, 2009-10, Lerner's UK-based holding company which owns Villa, Reform Acquisitions, lost £38m, so losses worsened 42% in 2010-11.
Lerner himself continues to fund the club, via an ultimate holding company also called Reform Acquisitions, registered in the US, and Villa said Lerner has invested a further £25m into the club. Companies House documents show the total Lerner has invested in return for shares is now £133m; he has also put money in as loans, but Villa did not release full figures, only the headlines of their financial results, so the total Lerner has invested is not yet known.
Despite that investment, Villa sit 15th in the Premier League table and with attendances at 42,582-capacity Villa Park generally in the low 30,000s for matches against all but the biggest clubs. They announced they spent £12m in "exceptional charges" in 2010-11 relating to changing the club's "management personnel". That apparently refers to Martin O'Neill, who left in August 2010 and subsequently achieved a financial settlement at a tribunal, and also compensation paid to the departing Gérard Houllier and to Birmingham City for Houllier's replacement, Alex McLeish, although that change happened in June 2011 after the date of these latest accounts.
Villa pointed to a slight increase in the club's annual income to a record £92m as a pleasing development: "This was achieved despite a backdrop of instability as the 2010-11 season constituted one of the most turbulent in the club's recent history," the club said.
In the summer of 2011, Villa sold Stewart Downing to Liverpool for £20m and Ashley Young to Manchester United for £17m, a total of £37m, with Charles N'Zogbia, for £9.5m and Shay Given, for £3.5m, £13m altogether, the major arrivals.
The scale of losses and of subsidy paid in by Lerner, at a time when clubs are seeking to move towards breaking even to comply with Uefa's "financial fair play" rules, partly explains why Villa decided they could not refuse the offers for Downing and Young. Since then, the club have tried to bring down the wage bill, although the figures for spending on wages were not released.
Robin Russell, Villa's chief financial officer, said: "The board is confident that the actions taken since the end of the 2010-11 financial year have galvanised the longer-term sustainability of the club and have given us a better financial platform on which to build for future success."
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