Bulls director Stephen Coulby has insisted the club’s financial situation is far worse than was originally thought but is confident the necessary funds can be raised to avoid administration.
Coulby said a significant sum, understood to be around £500,000, is in the pipeline from a would-be investor but that at least another £700,000 was needed to safeguard the club’s future.
After fans raised around £500,000 during the Quest for Survival campaign, it was initially thought that another £500,000 would pay off current liabilities.
Now, however, after an independent review of the club’s finances, Coulby said that around £1.25million was needed to meet the club’s debts and take it forward until the end of the year.
He claimed that ex-chairman Peter Hood and Andrew Bennett failed to pay a £250,000 VAT bill on the deal which saw them sell the lease on Odsal to the RFL before taking out a “six-figure loan” in March.
Coulby says that the club is currently losing £100,000 per month and that Hood and his former co-director Bennett budgeted to lose over £1million this year.
Coulby told the T&A: “The independent financial review has taken place and a further injection of £1.25million is needed to pay off short-term debts and keep the club out of administration.
“Nevertheless, we’re in a position to carry on the talks with investors and progress is being made.
“There is more than one party involved and they want to see business plans and budgets for next year, which is what we’ve been doing for the last three weeks.
“There is progress being made but other things have come out of the woodwork, such as a six-figure loan which we didn’t know about.
“That was taken out by Hood and Bennett in March, which was after they had done the deal with the stadium.
“We’re on with the business plan and budget for next year because we need to get away from losing £100,000 a month, which is what is happening at the moment.
“Peter and Andrew budgeted to lose over £1million this year. How the hell you budget to lose that sort of money, about £1.2million, in a business is beyond me.”
Coulby said that a payment of £250,000 was due to HMRC over unpaid VAT on the Odsal deal.
“They haven’t paid the VAT on the money which they got from the RFL,” he said.
“They got £1.25million from the RFL plus VAT, so they got £1.5million in the pot and they haven’t paid that £250,000 to HMRC.
“That amount is now due and there’s this additional six-figure loan that was taken out in March which we knew nothing about.
“There are also other potential items going forward as well which we’re having to work on.”
Since Hood and Bennett stepped down as directors last month in the wake of the club’s financial crisis, Coulby and Rowland Agar have replaced them on the board.
Along with former chairman Chris Caisley, who remains the Bulls’ single largest shareholder with around 26 per cent, they have embarked on a major strategic financial review of the cash-strapped club.
Coulby, who said he was confident that players and staff would be paid as normal next week, believes the club can negotiate a way through its current crisis.
“Like I say, there are conversations ongoing with more than one potential investor and we are quietly confident of avoiding administration,” he said.
“In the meantime, we remain extremely grateful for all the support given by the fans going into Monday’s important game against Castleford.”