Newconomics: Interest payments 75% above transfer spend


Celtic net financing cost £201k (interest paid minus interest earned), Newco net finance cost £2.997m, that’s 6.25% of their income paying for previous season’s spend.  This percentage is a key metric for distressed companies.  David Murray’s Rangers paid 7.7% of their income in finance costs 19 years ago.  That was clearly unsustainable.  Rangers subsequently converted loans into shares (sound familiar) but were unable to apply a tourniquet on the losses, which eventually led to liquidation.  Newco are walking the same path.

Celtic and Newco both had a reduction in income, minus the reduction in costs due to the lack of fans, of around £9m. Newco state this net loss at “over £10m”, which gives an indication of what they will present in reporting to Uefa.

If we correct the reported losses for the 2020-21 exceptional items, Celtic’s loss is reduced to £2.3m, Newco’s to £14.5m.  The sale of Bayo and Hendry more than covered that trend loss for Celtic, leaving income from the sale of Edouard, Ajer and Hendry for new signings.  Newco’s entire transfer income was £1.7m.  They pay 75% more than this in interest.

When I started writing here about Asset Management, the moans came back about becoming ‘a selling club’.  If you are not selling players at the right time, for the right fee, something else is picking up the pain and you are underachieving.

Signing the finished article is more likely to help you succeed in the short term (although loanee Shane Duffy was 28 when he arrived), but the return on your investment from players purchased at that age is likely to be low.  They have been around long enough for their perceived values to be fixed.  When performances drop, you cannot move them on at a profit and need to cut elsewhere to replace them.

Sales from a hugely underperforming Celtic squad took in £34m transfer fees this summer.  20 times more than Newco’s £1.7m from a title winning squad.  And let’s be clear: before the summer they acknowledged they needed to sell, an admission their accounts confirm.

There is a trade-off: the instant hit or a more strategic play.  Strategic players win more often, that £34m has been transformational to what Celtic have been able to do this season.

How much of your income to pay to service debts inhibits what you can spend going forward.  Not all spending is equal.  Some will perform long-term, providing reinvestment funds after the player has moved on.  Others not so much (we have been there, think of the £6m signings of Sutton, Hartson and Lennon and the chasm when they aged).

Dave King clearly felt slighted by the tone of Newco’s accounts and responded in The Herald today, when he confirmed his £5m loan, plus £832k interest, had been repaid a little over a week ago.  There was an insistence that despite King, Douglas Park and others (let’s call them the Concert Party) saying they would provide interest free loans to the club without taking security, the South African authorities would only allow him to give Newco loans if they were at a commercial rate of interest – 8%, if you don’t mind.

I have no reference point for this kind of insistence.  He does not elaborate on what “authorities” we are talking about, but he has a bit of form in South African, so is perhaps wise to not be too specific and do what he is told.  He also reiterated his pleasure that “the authorities” allowed him to make the loans unsecured.  They sure are involved authorities.

The secured, interest paying, loans from others in the Concert Party clearly irk King, always a man of his word.

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  1. 3sy



    Sound rumour to start.i suppose they may be looking for a 49 time convicted criminal to put his hand in someone else’s pocket to keep in narrative.Do you know anyone? 🤣🤣



    He is a liable as macinnes, or scotlands 2 trophy winners,1 more than the 1 in 9,-cal Davidson,Frank would need a purse to spend.






  2. Kev J Exotic



    Your political views are more Trumpist, via Q Anon and Russia Today, than Socialist.



    Sadly, the political giant that was George Galloway has long left the building.



    Enjoy complaining about people that don’t look like you or think like you! but , thankfully, there are just too many of them and too few of you despite the multi log-ins

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

    JIMTIM on 10TH NOVEMBER 2021 8:39 PM


    Just read an article that ange could be interested in two Japanese bhoys . 5ft 7 and 5ft 8 . If true this is getting beyond a joke





    Hi JimTim. Understand what you are saying about the need for some height and muscle in the team – always loved big Dolph and the Grim Reiper.



    However – I would just urge you to have a wee look in particular at Daizen Maeda (at 5’8” he’s the big fella of the two you mentioned).



    Watched a few videos of him – never seen acceleration and pace like it. That wee man would be absolutely amazing in this Celtic team. Honestly – please have a look – it’s impossible not to be excited at the prospect of seeing him in the Hoops – he’d terrify defences domestically and be a huge threat to the majority of teams Europe.



    Even if you don’t want more wee guys, enjoy the videos!!!!








  4. CAMUSBHOY – pleased to learn your first session and prognosis were good.


    Keep the faith in the experts (and the Celtic). HH



    As we saw the exodus of an entire coaching squad affects club and players in many different ways – and certainly not all positively. Confusion, confidence, uncertainty are all introduced to the mix and some players won’t fancy the new guy and they won;t always fancy all of the players and their personality quirks.



    This is an adverse situation that can’t readily be reffed away. Ange will keep us fantastically focussed while their heads are all over the shop.

  5. David17 on 10th November 2021 8:50






    They are going Down.




    Ange’s comments were Good.




    Concentrate on Celtic getting Better and actually doing Something in Europe.

  6. Given the fact Der Hun scum has little or no money to spend lets all hope it’s not Dr Livingstone that comes to their rescue this season.

  7. Saint Stivs



    So Many want to Stifle.



    Leverkusen 1 Celtic 3




    They will be in turmoil as their next pay checque – those not hardcore……..LRA – I dinnae mean the excellent Bayer Leverkusen. The New Newco is incoming.







    Its possible. I dinnae like International games now.

  8. fence







    Got to love Ange’s ability not to mix metaphors


    I do want to binge on Celtic victories but will take the occasional duffer in a series.

  9. !!BADA BING!! on 10TH NOVEMBER 2021 10:01 PM


    Still with this Galloway shite… off




    after you…..



    Kev J Exotic


    Your political views are more Trumpist, via Q Anon and Russia Today, than Socialist.


    Sadly, the political giant that was George Galloway has long left the building.


    Enjoy complaining about people that don’t look like you or think like you! but , thankfully, there are just too many of them and too few of you despite the multi log-ins




    I don’t know who or where Kev J is.


    Multi log ins? You really are vacant.


    But he seems to live rent free in your head, an lots of other heads who think like you do, all because their incapable of thinking for themselves as it might cross your thought path, and that of course is their look out.


    I glimpse at other blogs now and again, back and furrit, and I see a pattern has developed, when a comment appears that flies in the face of established blog narrative, the reactionary response is that it must be a guy called Kev J.


    How does that work?


    I don’t know what this, Kev J, has done to you all, but it must’ve been severe.


    George Galloway has a bigger audience on his MOATS program on RT on Sunday from 7pm to 10pm in that window, George Galloway attracts a bigger viewing audience than the MSM news gets for an entire week, hardly yesterdays news, more like the here and now, if your not already cowed.


    Too many on here usually means clique.


    Didn’t the clique smash this, Kev J, when he used to post on here?


    Or was it the other way round?


    When you resort to wee girly names to address a poster, that means you know you’ve lost.


    Doesn’t it?


    100% of Celtic’s enemies are terrified of George Galloway.


    And yet you diss him?


    Ever wondered why this and other blogs are levelling out?


    Just before you go to sleep, say goodnight to Kev J for me. ✌

  11. !!BADA BING!! on 10TH NOVEMBER 2021 11:18 PM


    Put the Galloway nonsense, on a satirical site where it belongs,stay away from football blogs.




    You really need to aim that at, Stiffy, he’s the one who started the George Galloway chat, and I don’t see you snarling at him.


    I was merely reminding Stiffy, that he was talking guff, and SFTB, neither of them like being stood up to.


    That’s all I was doing.


    The Celtic fc seems to be winning its off field battles well without the help of, George Galloway, don’t you think?


    Or is look the other way the name of the game on here?

  12. LARKIN1907 on 10TH NOVEMBER 2021 11:28 PM


    and the full media conference is worth a listen…





    It most certainly is. Celtic are on the verge of something great again.

  13. Davie Provan thinks THEY have to go for a big name the troo bloo loyals will accept.



    Surely it’s John Terry.



    All the right creds for the neds.

  14. CELTIC DAWN on 10TH NOVEMBER 2021 9:24 PM


    JOE ORDINARY on 10TH NOVEMBER 2021 8:46 PM


    George Galloway’s views have degenerated from what?




    From someone who may have been a socialist to someone who said he would work with the torries. No friend of the miners or the real working class of scotland.




    He voted Tory




    First rule of fight club. You never ever ever ever vote Tory, no matter the circumstances




    The bin workers took the place of the miners this week by merely standing up for themselves, and their rights, and were painted as the bad guys for it. Sond familiar?


    No political party in Scotland stood up for the working class bin collectors, not a single one!


    Just think about that.


    In Scotland ‘this’ week, in front of the worlds watching media, the entire Scottish Parliament, stood against the working class bin men.


    Only, George Galloway’s, WorkersPartyGB, showed the solidarity to these working class citizens, in their hour of need.


    So, SNP, CON, LAB, LIB, GRN, would as well be all in the same party.


    “THE SELF PRESERVATION PARTY” what a shower of pks!


    I’m afraid that the ‘first’ block to helping working class Scottish people to have better lives in Scotland, is to get more Unionist voters into Scottish Parliament, even though they are also rubbish, they have to be used, to get working class ‘list’ party MSPs into Scottish Parliament to smash the preservationists, and getting rid of SNP (tartan Tories) who only this week, outlined above, SNP said that “bin emptiers were out of order asking for a pay rise” so, SNP, Con, Greens, Lab, Lib, all refused to back workers emptying bins full of rats, then the SNP/Grn compliant STV/BBCScot distorted the bin workers case for a rise to a living wage level increase, and made workers who empty bins full of rats, out to be greedy and insensitive. Really?


    Its a difficult job to get rid of SNP, because Con, Lab, Lib, will not work together to block SNP majority, so, Con, Lab, Lib, would prefer the status quo, pishy lives for a lot of Scots working class people, to keep working class George Galloway out of Scottish Parliament, so there’ll be no one rattling the cages for working class Scottish people, whilst useless Scottish MSPs, all of the parties play charades, and STV/BBCScot all play along taking the piss. So, all that’s left is to vote all useless Unionist MSPs to get a small party elected from the list votes.


    But, then there’s the ‘plants’ who count the votes. How can there be democracy when certain votes will be blocked? So the circumstances have changed, then changed again. If getting SNP out means cutting their majority, how can you do it without voting Unionist to get a list vote through? Then the ‘plants’ move in and remove the votes they don’t like and you realise after a while that, Scots voting is as gerrymandered against working class people, as NI was gerrymandered against Catholics. And the public are unaware!

  15. AN TEARMANN on 11TH NOVEMBER 2021 12:12 AM


    Jamie bryson and Joe brolly


    Good 40 mins







    Jamie Bryson knows that his profiteering from anti Catholic sectarianism is getting more desperate by the day . Encouraging to see the breakthrough of a heart warming smile now and then despite his upbringing. Hopefully he himself and the likes of Joe Brolly can help guide him out of this “Protestant State For A Protestant Peeple” UK Unionist mess.

  16. re above (28min 14 sec) . Someone in the know get the songed version of The Creed over to the Green Brigade choir asap please.