Financial fundamentals, credit where due at Ibrox

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Credit where it’s due, season ticket sales at Ibrox near 17,000, with so many people trying to force the club into the gutter, is an achievement, and ignore anyone who doubts this figure.  Respect to those fans who have remained ‘loyal’.  The information was released to the stock market, so sales will definitely be north of 16,500.  It’s not worth lying to the stock market over such trivialities.

In the short term, this means the club will be able to meet its loan repayments, if they choose to do so.  Don’t ignore the possibility of a game of brinksmanship over loans made by fans hostile to the board.  Lenders could be forced take insolvency steps to recover their money, which would be politically awkward, so the club might be able to hold onto this cash.

It also means they will survive the summer and start the new season, which in itself, will encourage others to buy season tickets.  The eventual figure may reach 20,000.

With adult tickets costing an average of under £300 before vat, that’s circa £5m hitting the budget so far.  Visits from Hearts and Hibs next season, in what counts as big games at Ibrox these days, will provide additional income, which will go towards offsetting the drop in income from lower season ticket sales.  Controlling investors are looking to raise £8m from a share issue, so where does that leave Newco?

Based on figures produced by the club in their 2012-13 accounts, income, including a contribution from circa 36,000 season ticket sales, was £19m, while operating expenditure was £32m, leaving an annual shortfall of £13m.  Since then, costs and well as income, have fallen.

The £8m share money still leaves them short by a margin that’s likely to be at least £5m, probably more, so further funding should be required by early next year, possibly in the form of a secured loan.

From this position, assuming they compete successfully on the pitch, Newco are short odds to survive long enough to make it into the Premiership for season 2015-16, albeit, still carrying an enormous structural overspend.

It’s also likely that Dave King’s plans, however limited they were, have been torpedoed.  Newco will limp on as an unrecognised and unloved rump of a football team, largely owned and controlled by people who have done everything in their power to hide their identity from fans.  We can only speculate………

Know your place

King’s most damaging intervention in recent months was to assert that Newco should be spending enough money to compete with Celtic, which after original Rangers went through liquidation is hard to fathom.  Newco Rangers must surely learn to live within their means, whether that involves competing with Celtic or fighting off relegation.  Those now running Newco can insist all they like that they are custodians of the heart and soul of Oldco, but only the colour of the shirts will bear any resemblance with the former ‘bears’ in the decades ahead, should they survive long enough to enjoy them.

The financial fundamentals have not changed.  It will cost between £17m and £20m to operate a football operation at Ibrox, before you employ a footballer.  Rates (possibly rent in future), policing, insurances, utilities and the hundreds of staff required for a stadium which can accommodate 50,000 people leave little room for shortcuts.  Jettisoning the vanity project that is Murray Park is a no-brainer.  Get rid of it, cut costs and bring in some cash.

Football on this scale in Scotland is only possible with regular Champions League participation.  Celtic could not operate at anything like their current levels without reaching the Champions League group stage more often than not, or by receiving an investment of cash to recover the situation, should the bogey come off the rails.

This scenario has gone for the Rangers group of clubs.  Celtic’s dominance has come while they have sorted out their finances and, right now, are not in debt.  Should things go wrong one season in the future, they have the bank facilities available to roll the dice again.  Should this go wrong they have investors available to step in, just as they did in 2001 and 2005.

Dave King’s plan may have been unfathomable, but his motivation is not.  He knows too well that a subservient Rangers will be unloved and will eventually wither and die, just like the supremacist, version.

Don’t even try to fight long-term fundamentals.  They are fundamental!  Accept it.

The one and only Bertie Auld is due in the comments section below for a live chat starting at 1pm. Tune in.

Visit the CQN Bookstore to get Tommy Gemmell to sign your personal copy of his tome, All the Best.

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996 Comments

  1. thebhoyfromoz on

    hugh bonkle fae dallas.

     

     

    Good shout, and I’m sure he would relish the chance of playing in the champions league.

  2. 16 roads - Celtic über alles... on

    Such a game of football this is.

     

     

    Fair play to Australia and Chile.

  3. Ok guys, the ole eyes are starting to close. And the red vino is done.:-)) I will bid you all a very good night, good morning or good afternoon, depending where you are on this wonderful planet.

     

     

    Night Night Timland.

     

     

    Weefra HH praying to Wee Oscar.

  4. 16 roads

     

     

    Both teams going for it. . .

     

     

    As the pundits say, this game is definitely stretched, end-to-end stuff indeed.

  5. 16 roads - Celtic über alles... on

    beatbhoy

     

     

    00:26 on 14 June, 2014

     

     

    —————————————–

     

     

    I agree.

     

     

    It’s like Scottish football at it’s best.

     

     

    No messing about whatsoever,highly contested as well.

     

     

    HH.

  6. Hugh Bonkle fae Dallas on

    Thebhoyfromoz trying not to sound like some sort of told you so but loved Cahill’s attitude from his Everton days. Surely he’d prefer a cracking at the CL to the MLS. Best header of a ball since Henrik.

  7. What if the moon were cheese?

     

    What if Sevco had a saviour charging over the hill with a warchest of £100m.

     

    I dont understand why you would ask such a what if.

     

    What if Fergus hadn’t stepped in.

     

     

    Look at the advertising on here, that’s not free.

  8. Chauffeur duties. Delay tv and avoid CQN for the score. Should be some last 10 minutes or so.

     

    Boa noite a todos.

  9. thezombieslayer on

    Its just a question doc ? What else is happening ?

     

    the moon is made of green cheese is it not ?

  10. TET

     

     

    How civilised. Must have been a bit like me watching Barca hump us last year.

     

    .

     

    What else can one do but order another beer and swally on?

  11. Dallas Dallas where the heck is Dallas on

    Sydney, I hope you and the family are well.

     

     

    I was out watching the Holland v Spain game tonight. Joe Dunne of the Dunne & Moore ginger dynasty and ex member of the Glasgow Uni bus, was in the pub.

     

     

    He sends his regards.

     

     

    Gerry W is doing a bit of music promotion as well as taxiing. The bandstand at Klevingrove Park has been done up with Squeeze and The Waterboys playing at it over the next few weeks. Gerry is one of those promoting these gigs.

     

     

    Australia are playing well so far.

  12. ZombieSlayer, I’m not having a dig, just don’t understand that particular “What if”

     

    When there are many more what if questions to be left unanswered.

     

     

    If I may correct you, the Moon is made of green(and white) cheese.

  13. thezombieslayer on

    Yes there is dic tbh but am a bit mmm tired ! This friday night and just windered what if ? Lo, maybe am a little green troll

  14. Thanks for the mispell, I’m sure others have wished to use that:-)

     

    You may even set a trend.

     

    Enjoy the beer or wine, and keep posting, a post questioned is better than a post ignored!

  15. thebhoyfromoz on

    Poor start to the game from Australia, perhaps nerves got the better off them, but from 20 minutes onwards more than held their own and deserved a draw.

     

    Tim Cahill, still got it and would give any defence in world football a hard time..

     

    Entertaining game which, for a change, was well refereed.

  16. Drove by the Bigot Dome today……..the old feeling of enmity seems to be replaced with the idle curiosity of when will they paint the place and replace the sun bleached seats of old…..

     

     

    They’re done….certainly in the old sense……its over.

     

     

    Spain?…they got humped .As do all great teams….they will be back.

     

     

    My money is still strong :)

  17. Oz, it was a good game.

     

     

    GreenDreamz I drove by there this morning, it like rubber knecking a car crash!

     

    You can’t help yourself, but you know it’s wrong.

  18. bournesouprecipe on

    Doc

     

     

    Any particular reason why a trivia question was asked of Bertie Auld and missed three times, by at least two posters?

     

     

    Just asking?

  19. Dallas Dallas. Ahh mr dunne. A perfect gentlemen

     

    Last time I bumped into mr white was in a pub in Teplice

     

     

    The family are out giving me the house to myself. Peace and quiet

     

    World Cup not the same sitting on couch at 7:30 in morning

     

    Ah well nothing else to do on a wet chilly morning in sydney

  20. BSR, no reason, I had to apologies at least twice for missing questions, it really isnt as easy as it sound.

     

    Imagine.

     

    Celtic Legend, telling you stories, I mean you, one to one, and you are trying to keep on top of blog questions! Any others I missed I am sorry, but none were dodged.

     

    The Mhan was sitting next to me, tapping my shoulder to emphasise a point, laughing all afternoon.

     

    And those questions missed were down to me, not Bertie, and I do apologise for missing them.

  21. Bournesouprecipe

     

     

    We tried to answer all questions. None were deliberately missed or ignored. If there is a question you’d like to ask Bertie he is in the Celtic shop on Argyle Street from 1pm -4pm with Tommy Gemmell and big Yogi. We also have the European Cup and the Championship trophy there too!