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

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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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332 Comments

  1. blantyretim is praying for the Knox family on

    Morning Cqn

     

    Season back tomorrow and in the tradition of oldtim67 we will be in BV today to welcome the start of our quest for 9iar

     

     

    Usual rules apply

     

    KTF

  2. macjay1 for Neil Lennon on

    One last thing , Peter.

     

     

    I`m quite certain that UK will exit the E.C. and in years to come , we will celebrate the decision .

     

    And the , admittedly belated , leaving .

  3. macjay1 for Neil Lennon on

    PETEC on 2ND AUGUST 2019 6:49 AM

     

     

    That is much appreciated , Peter.

     

     

    Thank you.

  4. macjay1,

     

     

    I hope we do get out, too many in positions of prominence Determined to Impose their Will.

     

     

    The EU is Bad Bad Bad in my opinion.

     

     

    Scottish Independence – Not gonnae join the EU – Sign me up.

     

     

    So very sad.

  5. macjay1 for Neil Lennon on

    PETEC on 2ND AUGUST 2019 7:00 AM

     

     

    Democracy. The be all and end all.

     

     

    UK . Out of the EC.

     

     

    Scotland. Out of the UK , if that is the democratic decision of the Scottish people.

     

     

    Democracy overrides my preference.

  6. macjay1 for Neil Lennon on 2nd August 2019 6:55 am

     

     

    The Pound will go through the roof if the fantasy of a no deal Brexit happened.

     

     

    The Queen husnae huv tae dae a lot of things.

     

     

    I think she might be asked to do Something for her being,

     

     

    The Word always says to Pray for Your Leaders, As they have such a burden.

     

     

    Love is the Law macjay1.

  7. Resistance D – What a Brilliant and Inexhaustible Sonic.

     

     

    Lenny is Older, Wiser and still the same.

     

     

    Celtic FC is Lucky.

  8. If you are an amoral millionaire who wants to make some money out of the misery of others then I can understand you voting for Brexit. Anyone else who does is a moron.

  9. FrankTerry on 2nd August 2019 7:29 am

     

     

    If you are an amoral millionaire who wants to make some money out of the misery of others then I can understand you voting for Brexit. Anyone else who does is a moron.

     

     

    …………………………………………………………………………………….

     

     

    Moron is aff tae bed.

     

     

    God Bless you Bro.

  10. ‘Moron is aff tae bed.

     

     

    God Bless you Bro.’

     

     

    Ha! Moron just waking up :-) Have a good day.

  11. macjay1 for Neil Lennon on

    The Gospel according to a soshilist .

     

     

     

    RANKTERRY on 2ND AUGUST 2019 7:29 AM

     

    If you are an amoral millionaire who wants to make some money out of the misery of others then I can understand you voting for Brexit. Anyone else who does is a moron.

     

     

    ++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++

     

     

    Just a wee tad intolerant.

     

    Socialism writ large.

     

     

    Judge not lest ye be judged.

     

    Christianity writ large.

  12. macjay1 for Neil Lennon on

    PETEC on 2ND AUGUST 2019 7:11 AM

     

     

    Arbitrage is a dangerous road.

     

     

    I`m watching the fluctuations too.

     

     

    Pity our old pal Kojo no longer provides his valuable input.

  13. Frankterry,

     

     

    1,018,322 morons in Scotland.

     

     

    Pretty sweeping statement 🤔

  14. Good morning CQN from a dry at the moment Garngad

     

     

    Jobo great post from last night about CL and cash against EL games etc.

     

     

    A wee day off today for some DIY.. Aaaagggghhhhhh. She who must be obeyed has me running around looking for new internal pass doors then painting….. Ffs im better aff at work.

     

     

    Oh and is it illegal to download IPTV???? It looks great for a very minimal outlay.

     

     

    D. :)

  15. Garngad to Croy on

    Celtic hating BBC Radio Scotland , use the footage from the St Mirren goalkeeper firework incident to highlight the bad behaviour at Scottish football grounds last year . What is worse , being punched in the face by a wee ned ? Hit in the heid by a 10 bob bit ? Or shiting yer pants when a banger goes off 20 feet away ?

  16. macjay1 for Neil Lennon on

    GREENPINATA on 2ND AUGUST 2019 8:30 AM

     

     

    Thought I was ploughing a lonely furrow.

  17. Shuggiebhoy67 on

    Macjay,

     

    typical cherrypicker.

     

    Judge not,that you be not judged.

     

    For with the judgement you pronounce you will be judged,

     

    and with measure you use it

     

    will be measure to you.

     

    Matthew 7:1-2

     

    Christian Arrogance writ large.

     

    HH

  18. Watched a bit of Sky Sports News yesterday, I’m so glad I got that piece of excrement off my bank account many years ago. Apart from the content, when the adverts came on they were either about money lending or gambling – not directed at amoral millionaires (FT – whom I agree with 100%) but the poor, disadvantaged and desperate in our society – now that is amoral 🤬

  19. macjay1 for Neil Lennon on

    SHUGGIEBHOY67 on 2ND AUGUST 2019 8:48 AM

     

    Macjay,

     

     

     

     

    typical cherrypicker.

     

    =======================================================

     

     

    Now thats not very Christian , is it ?

  20. macjay1 for Neil Lennon on

    SHUGGIEBHOY67 on 2ND AUGUST 2019 8:48 AM

     

     

    Christian Arrogance writ large.

     

     

    ——————————————————————————————

     

     

    Now that`s not very Christian , is it ?

  21. macjay1 for Neil Lennon on

    SHUGGIEBHOY67 on 2ND AUGUST 2019 8:48 AM

     

     

     

    FYI

     

     

    I was conversing with Petec.

     

     

    And he IS a Christian.

     

     

    But thank you for your input.

  22. macjay1 for Neil Lennon on

    POGMATHONYAHUN AKA LAIRD OF THE SMILES on 2ND AUGUST 2019 9:09 AM

     

     

    Yes.

     

    Agreed.

     

     

     

    Judge not lest ye be judged.

  23. Just a wee tad intolerant.

     

     

    Socialism writ large.

     

     

    Judge not lest ye be judged.

     

     

     

    Christianity writ large.

     

     

    MACJAY1 FOR NEIL LENNON on 2ND AUGUST 2019 8:29 AM

     

     

    Let me guess, you’re a big fan of Trump aren’t you? That good ol’ racist and rapist.

  24. ” Get It Roon The Rainjurz!”

     

     

    :))))))))))))

     

     

    :0

     

     

    :)))))))))))))))))))))))))))))))))))))))))))))))))

     

     

    Can’t believed I missed the latest Edmiston Farce ( Whoops there goes The Deeds!”) ……..

     

     

    On the Pavillions site some o’ the comments from the patrons are beyond parody.

     

     

    Is it impossible for the scoddish to see that if they were singing about any other rce or creed or culoture they’d be locked up?

     

     

    What’s next for Christmas – Fiddler On The Asbestox Roof?

  25. macjay1 for Neil Lennon on

    FRANKTERRY on 2ND AUGUST 2019 9:16 AM

     

     

    Guessing is the best option of the uninformed.

     

     

    Tempted to say ” ignorant ” , but that wouldn`t be Christian.

  26. macjay1 for Neil Lennon on

    FRANKTERRY on 2ND AUGUST 2019 9:16 AM

     

     

    Trump`s a rapist ?

     

     

    Is that not actionable ?

  27. traditionalist88 on

    POGMATHONYAHUN AKA LAIRD OF THE SMILES on 2ND AUGUST 2019 9:09 AM

     

     

    I’m a Christian but only God will judge me on how good I was.

     

    ============

     

     

    Maybe if he stopped judging and started being the ‘all seeing, all powerful being’ he apparently is the world would be a better place and have less cases of child cancers, poverty and natural disasters.

     

     

    Maybe not.

     

     

    But an entity that apparently can do anything…

     

     

    Makes you wonder.

     

     

    HH

  28. Frankterry,

     

     

    1,018,322 morons in Scotland.

     

     

     

    Pretty sweeping statement 🤔

     

     

    How else would you describe a group of people who now believe that they were voting for a no deal Brexit (which will only benefit an extreme right wing group of disaster capitalists) when it was never mentioned in the referundum? Not even by Farrage and his merry bunch? Are they closer to geniuses or idiots?

  29. Big Georges Fan Club - Hail, Hail, Wee Oscar on

    Hello this is WEE BGFC. Any sausages for the cricket at all