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 rangers.co.uk 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. Mike in Toronto on




    Sorry…. stepped away for a call there…. but SFTB has set it out well (and more succinctly that I would have!)




  2. i'vehadtochangemymind on

    I believe in the kingdom come


    Then all the colours will bleed in to one



    We’re gonna win the league!

  3. Hunderbirds are Gone on

    Next stray dug that passes ma hoose is gonnae get a bowl of that beetroot that’s been in the fridge since before Christmas.


    I have to see that. 😃



  4. Rock Tree Bhoy on




    “bhoy in my work actually says to me last week he was winding up his Sevs pals saying “you better no go down the leagues again” and he is a season ticket holder”



    You need to have a word with him, they have never been down the leagues, in fact they have only come up leagues. I like beating sevco / winding up sevco fans as much as the next Celtic man but given the choice between beating them and killing them off completely its finish them off every time. But hey ho, it’s a free world, I was just surprised that Mike in Toronto thought we were all like your work mate. Him and DD, thats 2!

  5. Rock Tree Bhoy 6.54pm



    Only worked beside the bhoy for a few weeks, Celtic daft, but am afraid like many (especially the youngsters) they don’t care … no ma job to try and enforce any opinion on him



    I always try and put a Sev right when demotion/relegation ever replaces liquidation :-)



    By the way there are far more Celtic fans that tell me “stop reading that internet shoite” so we have differing opinions

  6. SOUTHSIDE on 1ST AUGUST 2019 6:25 PM



    Don’t think we should be leaving anything to chance this season. We’re still short in key positions going into the first league game and that’s careless imo.




    We need two right backs, one left if KT leaves, backup for Broonie, a left sided midfielder and a striker.



    Sevco will be throwing everything into this season, anyone banking on them going pop or tightening their belts hasn’t been paying attention. The sevs are like a kid with giant bar of chocolate. Tell it it’ll make them sick if they eat it, they still eat it.



    Back Lenny to the hilt and blow that mob out the water.



    Give NL the right tools and he’ll get intake them like a dug eating beetroot!






    Post of the day.



    Powerful. 👏😎



    HH. 🍀

  7. SFTB @ 6.28



    Not ideal to play the opening SPL game, without having strengthened RB



    I agree on timing, in a way I’m glad we might yet miss the August cut off for the level of player that has been mentioned from England.



    The slot is there, the transfer fee is there, and the salary is there, all we need is a target to say, yes.



    I believe NFL in that, we’ll get a better stamp of player should we beat Cluj and one other and qualify for the CL, I’m happy to wait, and don’t accept that we’ve gone downwards from Castagne to O’Donnell.

  8. Not only are Sevco wearing their Hummel kit but Progres are too. Nil nil at half time. Progres putting some decent moves together at times but no real chances to speak of. Unfortunately.

  9. Weejoe,


    haven’t studied the judgement closely enough but I think they can no longer sell the Hummel kits to fans, etc but not sure there’s any impact on the team playing in them for this season.

  10. We will likey play 3-5-2 againt cjud. wee forrest will be right wingback in that system in the euro game coming up. He does ok in that role.



    So yes we still need a rightback unless the new boy is good enough.



    we will need a central midfielder if any other midfielders leave.



    Still think there is plenty of scope to cut the squad down.



    With the forwards we have i would love to see us use 4-3-3 as well.

  11. Are these the big bad Huns that fearties were saying could stop 9 in a row.


    My local Club Cork City are in meltdown, having their worse season in years, 3rd from bottom in League of Ireland.


    Were beaten 2 nil at home by Progres, but missed a penalty & had the better of the game, my nephew was there and said they were unlucky to lose.


    They then went to Luxembourg and took a 2 nil lead before Progres scored and won the tie 3-2 on aggregate,

  12. Corkcelt



    Because we want the Huns to be useless, our judgements are sometimes clouded. Taking that into account, I have just watched 15 minutes of the second half and, being as objective as I possibly can, I cannot say I am impressed.


    I expect them to drop points againd Kilmarnock ( unless Killie are a much lesser side than they were last season).




  13. You would think, based on P67s leader & posters askin relevent questions about whether the hun dafties can buy strips etc , that this would be …..news in Scotland





  14. Terje


    Although the MSSM will not , of course, say anything about it, the `Everyone,Anyone` campaign is an admission that it was not always thus.




  15. I’ve no idea what Gerrard does in the training pitch during the week. They look utterly clueless. Second year in the job and that was utter pish.



    Midtjylland have absolutely nothing to fear.

  16. ROCK TREE BHOY on 1ST AUGUST 2019 5:48 PM



    My take on it… It’s like a union meeting in my work, all vociferous for rejecting the offer on the table.


    A show of hands… 90%, tell them to shove it.



    Secret ballot… Accepted. It’s the way it is.

  17. Steaua Bucharest 1-3 down at home to our old foes Alashkert. Bucharest finished second, two points behind Cluj last year.



    We should be aiming to go to Romania and win next week.

  18. It’s absolutely murderous trying to post on CQN these days. I keep getting kicked off and losing my posts.



    Anyhoo, apologies if it’s been discussed already but has there been a rule change governing bye kicks? Previously ball had to leave the penalty box before anyone could play it but that didn’t seem to be the case tonight during the Sevco game.

  19. AN DUN @ 8:41


    True, but they won 3-0 in the away leg, are down to 10 men in this one, and still lead the tie.



  20. AN DUN @ 8:41


    True, but they won 3-0 in the away leg, are down to 10 men in this one, and still lead the tie.

  21. whitedoghunch on



    Belfast take her to OX, fuss free well priced tasting menu and drinks pairing


    Donegal – don’t know