Reds owners make heavy loss

Hicks & Gillett: Heavy loss

Liverpool's accountants have fired a word of warning after the parent company owned by Tom Hicks and George Gillett suffered a £42.6million loss last year.

The figure is mainly due to interest payments on the debts the Americans took on to buy the club.

In the annual accounts released on Thursday night, Liverpool's accountants have also warned that remaining uncertainty over refinancing the £350million debt before the 24th July deadline 'may cast significant doubt on the group's and parent company's ability to continue as a going concern'.

Although Hicks and Gillett say they are confident of securing a refinancing deal, the figures reveal that the financial success of the football club is being swallowed up by the cost of servicing the parent company's loans.

The accounts for the year ending July 2008 showed Liverpool made a £10.2million profit but the parent company Kop Football (Holdings) Ltd made a substantial loss of £42.6million, mainly due to interest payments totalling £36.5million.

The clubs accountants KPMG LLP also expressed a warning in their notes in the filed accounts.

The accountants said: "The group has credit facilities amounting to £350million which expire on 24 July 2009. The directors have initiated negotiations to secure the replacement finance required by the group and these negotiations are ongoing.

"These conditions... indicate the existence of a material uncertainty which may cast significant doubt on the group's and parent company's ability to continue as a going concern."

The club's turnover was a record £159.1million compared to £133.9million the year before, with a profit of £10.2million.

That was reflected by a similar turnover for Kop Football (Holdings) of £164million - most coming from the football club - but the overall loss of £42.6million.