Newco: trading loss, commercial gap, High Court. A familiar story unfolds


It doesn’t really matter to you or I who Newco buy or sell, but it is unedifying to see a campaign run over weeks to generate cash on the back of a guy who specialises in goals against the likes of Hamilton and St Mirren.  Yesterday we were asked to believe that Alfredo Morelos declined to go to China as part of a £30m deal.  The like of this story has not been seen at Ibrox since the last days of Oldco under Craig Whyte.

You would be forgiven for worrying that Newco have some cash issues.

In their most recent annual statement, for the year to 30 June 2018, they lost £14.3m.  That season did not include revenue from Europa League group stage qualifications, which the most recent season did, but when the next accounts are published, they will also show a significant increase in expenses.  I expect losses to be in the £7m to £10m region, before adjustments are made due to the recent High Court judgement in favour of Sports Direct.

That judgement, which is no longer subject to a potential appeal, has incredible commercial reach.  If you visit the Shop at you can buy match programmes, hospitality, Ibrox tours, pictures, bricks, TV subscriptions and lotto, but you cannot buy so much as a novelty duck, never mind a replica shirt.  Sports Direct are linked from the Partners page, where they sell Puma kit of 2017-18 vintage.

This lack of revenue from club merchandise will hit Newco directly, and indirectly, when their inability to perform to the terms of their contracts with Hummel and distributor Elite Group for this season are calculated.  This is in addition to the compensation they will pay Sports Direct for loss of profits last season and this season, and the compensation they will pay Hummel and Elite Group for their contracts for next season being set aside.

Then there are all the legal costs.  The total cost of Mr Lionel Persey QC’s judgement could easily top £10m.

Should Newco fail to qualify for the Europa League group stages, their top line will take another £10m hit, although expenses will remain well above the figures we have for the year to June 2018.  Under those circumstances, Dave King might consider a £14m loss a “favourable settlement”.

We have been here before, when Craig Whyte faced what looked like impossible obstacles at Oldco.  The biggest mistake observers made then, was assuming Whyte had a plan to keep the club solvent.  He didn’t, there was no such plan.  This fantasy chat about a player who scores against the wee teams in Scotland, despite Steven Gerrard’s confirmation that no bids have been received, looks like an all-too familiar scenario.  It looks like a ‘Hail Mary pass’, if you can conceive such a thing at Ibrox.

This club needs a huge investment to meet this season’s obligations, and will need ongoing financial support until expenditure is brought down to sustainable levels.  It is always possible someone will find the tens of millions required and that they will qualify again for the Europa League, but I see no appetite for living within their means – an enduring anathema at Ibrox.

That being the case, it is a matter of when, not if, reality bites.  None of this means we are going to win nine-in-a-row (we will address this tomorrow), Oldco won the league in 2011 when in dire financial circumstances, but it should inform us that not everyone makes decisions with due concern for the consequences.  It would be interesting to know if HMRC, Sports Direct and other commercial creditors constitute more than 25% of monies owed.

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  1. PS


    I won`t be able to reply to any responses….I have to clean the Ferrari and take the lobster for a walk.

  2. traditionalist88 on

    Cluj in excellent form, last 5 games below – really need to be on our toes next week – you’d probably take a score draw away from home tbh:



    CFR Cluj 3 – 1 Astana


    Academica Clinceni 1 – 4 CFR Cluj


    CFR Cluj 1 – 0 Maccabi Tel Aviv


    CFR Cluj 1 – 0 Dinamo Bucureşti


    Maccabi Tel Aviv 2 – 2 CFR Cluj

  3. Go tell the Spartim on

    Putting our cliques aside for one second



    Not having a RB in when we effectively have none is a bit of a joke, is it not, given the importance of our early season european fixtures and how precarious it has been to qualify each year

  4. Mike in Toronto on

    Here is a short article outlining/comparing the duties and responsibilities of the Board of Directors vs. those of the CEO/executive.



    In short, “A company’s chief executive officer is the top dog, the ultimate authority in making management decisions. Even so, the CEO answers to the board of directors representing the stockholders and owners. The board sets long-term goals and oversees the company. It has the power to fire the CEO and approve a replacement.”



    As many on here have been discussing, and as P67’s article sets out, as presently run, Sevco are likely not a viable business. Unless they get some mega sales of players (and repeat it again next season and the season after that) and/or make massive money from a European campaign (and an EL run likely doens’t do it, they need at least one or two CL campains), I dont see how this business can survive.



    With their impending judgments, the only alternative for them is to pay wages comparable to Aberdreen or lesser teams… but, you and I know that their arrogance would never permit that.



    So, Celtic have to prepare for another nuclear winter in Scottish football…. and soon.



    And this is not bedwetting… we know it happened last time, and it seems quite possible, if not likely, that it will happen again.



    What we dont know is what was done to really and truly address this situation, to ensure that it never happens again …. either by the league or Celtic (these are two separate, but related, notions, and Celtic needs to be involved in the plans by the former and needs to have a plan for the latter.



    Our plan last tine they went under seemed to be to close our eyes, plug our ears, and pretend that it hadn’t happened.



    But, having happened once, we know that it is likely to happen again … and each time it does, it compromises the league and Celtic …(the latter, even, if only by association). Surely TV revenues would be higher for a league where a top team has not gone into administration TWICE… (leaving aside the same club issue for the moment).



    The SPFL is already seen as a diddy league, which makes it harder for Celtic to sign the kind of players they need in order to succeed in Europe. Agents will be aware that the league is a joke, so are not going to rush to have their players move to Scotland…. or if we do, we will have to pay over the odds to get them to play in the slum that is the scottish league.



    This is not a chicken little ‘the sky is falling’ concern … the sky already fell once, and is looking very likely to fall again … and soon.



    Last time DD acted like a grief stricken widow throwing herself on her late husband’s casket as it was lowered into the ground. He couldn’t bring himself to accept that they had died.



    Other than lying to us, (they weren’t relegated), what will DD and his band of merry men do when they go into administration again?



    What plans have Celtic got in place to deal with that seeming inevitability?



    Failure to plan is planning to fail has never seemed more true.



    And as a Board, they have an obligation to shareholders to do this.



    And I accept that not every decision by a Board needs to be shared with shareholders. In fact, I accept that many should not be shared publicly.



    However, this is an extraordinary situation which strongly suggests that shareholders are entitled to know what steps are being taken to ensure that the integrity of the game, and hence, their investment is protected. Particularly, as this exact scenario has already happened once, and there is no indication that any steps were taken to ensure that it could not happen again, or if plans were put in place, they clearly have not been followed, or we wouldn’t be right back to the same scenario.

  5. Mike in Toronto on

    Hot Smoked



    I have long suspected that you are, in fact, Peter Lawwell.



    your ‘I hope PL is not reading this’ was a dead giveaway, clearly intended to throw us off your trail.



    But if I had my doubts, the next line clinched it.



    I noticed the clever “i am perfectly happy with the prices’ comment, which was, once again, intended to deceive, as most of us would think that PL would say ‘prices should be higher’.



    But, only someone as cunning as PL would be so …. well, cunning.’



    Which, once again, only proves my point that you are indeed Peter Laweell…



    I claim my five pounds. And no, I dont want to put that towards the purchase of a seasons ticket.




  6. Melbourne Mick on

    Hello again all you young rebels.





    Maybe the huns thought 5 million for a new Roofe was too good to


    miss considering their old one is getting a bit shoogly 8-))


    H.H Mick




    The forward planning looks like hoarding cash and then hoping, before it runs out, we are invited to play elsewhere, yes I know!, por cierto.

  8. Mike in Toronto on

    oops … sorry …forgot the link… and spelling was atrocious …



    but, zombie’s european campains … maybe a freudian slip of what I hope they will endure.

  9. !!Bada Bing!! on

    Pavilion bosses warn Rangers fans they’ll be booted from family stage show Rally Roon the Rangers over sectarian songs



    The scum take their kids to hear this…

  10. Cluj fans on Cluj Quick News,going mental.All saying,”Why have we not spent any money in the window,and why dont we spend millions to replace our best player,injured for the Celtic game”


    Their CEO,Peter Lawellescu,has remained tight lipped.

  11. !!Bada Bing!! on

    TB- perspective is when we are raking in millions, and we don’t have a right back worthy of the name,when scouting staff worldwide were told to find a right back 15 months ago,we will get one ,and not play him in our most valuable games of every season, as he won’t be match fit,and not know his teammates names,arise Sir Peter…..

  12. Go tell the Spartim on

    An injured player is a totally different scenario than letting all your RB’s go and not replacing them



    But you knew that ………………………………………………….

  13. Go tell the Spartim on




    it could always be worser ;-)



    Alwayslookonthebrightsideoflife CSC ((c) of you

  14. Go tell the Spartim on




    Either that or the new CB who can play RB, if hes match fit enough

  15. !!Bada Bing!! on

    Go Tell- hopefully Big Tam gets an hour on Saturday, and judge it from there? I can’t see him being up to a start v Cluj HH

  16. Go tell the Spartim on

    They’ll need to get up to speed at some point, think IF we are comfortable on Saturday he might get half an hour or so.

  17. SEE Astana (who CLUJ beat and raised a few eyebrows)



    drew 0-0 away in Andorra in EL are home today and 1-1 against Andorians ???



    after 26 minutes and going out


    MIKE IN TORONTO on 1ST AUGUST 2019 2:50 PM



    JJ is not PL .however he waits till JJ posts his team selection before he tells the manager who to play.

  19. Mike in Toronto on




    That’s too bad … JJ and I are supposed to have a drink next time I am back in Glasgow…I was looking forward to an invitation to Casa Lawwell, and seeing if that heated driveway was all it was cracked up to be….



    guess I’ll never know now.




  20. Just who is going to turf the sectarian bigots out of the bigotfest when the bigots start singing their sectarian filth?


    Cannot imagine wee Senga, the usher, will be up for it.