Rangers are facing insolvency issues unless they find £10m before the end of the season claims a report in the wake of the Ibrox club’s published accounts
Mike Meehal Wood’s article in business magazine Forbes, said Rangers tried to “hide” the “bleak” news, saying the announcement at 6.45pm on Friday evening was “conveniently after the majority of people have stopped looking at the news”.
In his piece, he notes that this year’s losses of £11m is, on the face of it, an improvement on the £14m loss announced last year, again with questionable timing. The 20 per cent increase in turnover is also recognised as a positive.
However, he says that “Rangers fans—who have a fairly recent memory of their club ceasing to exist before their eyes” should be “troubled tremendously” at the latest set of figures.
He highlights the second to last paragraph in the accounts, which reads: “The Board acknowledge that the uncertainty over the level of additional funds that will be required and a lack of a binding debt facility indicate that a material uncertainty exists which may cast doubt over the Group’s ability to continue as a going concern and therefore its ability to realise its assets and discharge its liabilities in the normal course of business.”
“Doubt over the Group’s ability to continue as a going concern…”
Steven Gerrard has already said that Rangers will be looking to trim costs, but given the above might find a need to take a pair of shears to the playing staff.
Newly appointed Ross Wilson will have his work cut out trying to get decent cash for players that have been unsuccessful by the measure that matters to supporters — and scouts. Winning trophies.
And that’s not the only problem they face, with a warning that the apparent financial black hole may well prove too much even for any ‘real Rangers man’ to put up with.
He continues: “Dave King, the major benefactor of Rangers, is currently losing upwards of £10m a year to watch Celtic win every trophy, and no matter how big a fan of the club he claims to be, that is completely unsustainable. Now, he must find another £10m to keep the club solvent until the end of the season.”
Wood’s article also highlights the eyewatering £9m in legal fees shelled out by the club (a £3m increase on last year, or to put it another way, an extra £10k a day going up in smoke fighting the likes of Mike Ashley) and says reports of contracts for the ageing Davis, Defoe and McGregor are “inexplicable”, given their financial position.
With the old Rangers trying to sign players on the day they went into administration, financial logic doesn’t seem to be in abundance these days any more than it was then.
Rangers financial situation may be approved if they should win the league and qualify for the Champions League.
However, as Celtic have found out, even with a standard of player of a level that has brought in over £50m in transfer fees in the shape of Moussa Dembele, Kieran Tierney and Stuart Armstrong, that’s easier said than done.
What happens next for Rangers then becomes a seriously pressing issue, even for a group of fans who are notorious for burying their heads in the sand.