Scottish League 1 Rangers Say Two Years After Tax Scandal, Financial Problems Over
Scottish League 1 Rangers "declared its financial problems at an end on Tuesday two years after one of the British game's biggest names was ruined by a tax scandal and forced to drop to the bottom of the professional leagues," according to Keith Weir of REUTERS. As the club announced financial results for the 13 months to June 30, the AIM-listed club said in a statement that "cost-cutting and improved retail revenues should improve the club's profitability in the coming seasons." The club said that an operating loss of £14M ($22.7M) in '12-13 "would not be repeated in a bid to revive past glories." CEO Craig Mather said, "We will continue to keep a firm grip on expenditure. As we strive to progress through the leagues, revenues can be expected to rise and there will be greater opportunity to improve financial performance further." The club reported revenue of only £19M in the '12-13 period "as sponsorship and broadcast revenue shrunk" following its demotion from the Scottish Premier League (REUTERS, 10/1).
MONEY IN THE BANK: The Scotland DAILY RECORD reported the club, which raised £22M through a share issue in December, revealed that it had £11.2M ($18M) cash in the bank on June 30, £4.5M ($7.3M) of which "came from season-ticket sales." The accounts also showed former CEO Charles Green "received a whopping salary" of £933,376 ($1.5M) for the 13-month period ending June 30. Manager Ally McCoist "took home a pay-packet" of £825,858 ($1.3M) for that period, while Finance Dir Brian Stockbridge received £409,308 ($663,000) (DAILY RECORD, 10/1). In Glasgow, a breakdown of the figures showed first-team wages were £7.8M ($12.6M) "while the club's biggest income stream by far was gate receipts and hospitality" (£13.2M) ($21.4M). Other "major sources of revenue included" sponsorship and advertising (£819,000)($1.3M), retail (£1.6M) ($2.6M), broadcasting rights (£778,000) ($1.3M) and commercial revenues of almost £1M ($1.6M). The club revealed that it had £4.2M ($6.8M) of non-recurring expenses, most of it from the repayment of oldco Rangers' football debts totalling £2.7M ($4.4M), "as agreed when the club's Scottish Football Association membership was transferred." The rest of this total was made up of investigation expenses and acquisition expenses totalling £600,000 ($972,000) each and share issue costs of £300,000 ($486,000). Rangers also revealed it had spent £600,000 "fighting Whyte's legal claim against the club" as part of an overall legal bill of £2M ($3.2M) (HERALD SCOTLAND, 10/1). Also in Glasgow, Keith Jackson wrote former Chair Malcolm Murray "could be poised for a surprise return to the Rangers board if Jim McColl's rebel shareholders win the battle for control of Ibrox." Murray "has been proposed by McColl's group as one of four non-executive directors they wish to have appointed." The investors "will vote for the removal" of Mather and Stockbridge at an AGM to be held before the end of the month (DAILY RECORD, 10/1).
ON TRACK: The FINANCIAL TIMES' Roger Blitz wrote the battle for control of Rangers "is set to flare up again at the club's annual meeting in three weeks' time." The board "is fighting off resolutions from minority shareholders calling for the appointment of a slate of directors" including Malcolm and Paul Murray. Malcolm Murray "has accused Rangers of lacking financial transparency since the flotation of the club on Aim in December," which raised £22.2M. But Stockbridge said that the club's results for the 13 months to June 30 "showed the club was on track with its long-term financial plan." Stockbridge: "We are not going to run out of cash. We have no bank debt" (FT, 10/1).