Leading financial expert silences Sevcomania with genuine insight into £23.5m Ibrox blow
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Rangers profitability “achievable” by 2022 claims football finance expert

A leading football finance expert has claimed that Rangers are on track to achieve self-sustainability despite incurring losses of £23.5m in the last financial year.

Rangers’ finances are a point of obsession in the Scottish sports press and particularly amongst rival fans but with agendas both for and against the Ibrox side it’s always difficult to get a proper sense of perspective whenever the accounts are published.

Rangers’ target for profitability by 2022 is “achievable” claims a leading football finance expert. (Photo by Willie Vass/Pool via Getty Images)

We’re certainly not financial experts – nor are we deluded into thinking Rangers can continue to post losses year-on-year without it coming to a head – but Kieran Maguire has offered some clarity with regards the latest accounts.

RONALDO NEEDS TO STOP WHINING.

The founder of popular football finance podcast and website Price of Football, Maguire has always proven a level-headed interpreter of the financial situation at Ibrox.

Speaking to the Herald, the football finance guru has given his two cents on the situation at Ibrox as things stand.

Rangers are targeting “profitability at the ETIBDA (Earnings Before Interest, Taxes, Depreciation and Amortisation) level by year ending June 2022” and Maguire believes this is an attainable goal.

The football finance expert has also cited Covid-19 as a major driving force behind the losses – something far outwith the current regime’s control as they continue to finance the club’s recovery.

“These results have been driven by Covid,” said Maguire.

“Whilst their takings from gate receipts and hospitality are down, they still took in £18m.

“Manchester United’s gate receipts for the whole year were £700,000. So Rangers have done well there. It was still the biggest source of income for the club.

“It will be different story in their next results. I am expecting a significant rebound. It depends on the degree of progress the club makes in the Europa League, but the match day income should return to broadly similar to where it was in 2020.

Rangers profitability is “achievable” for 2022 says football finance expert

“I think it is achievable objective for 2022.

“If you look at their EDITBA loss and add the thick end of £20m from match day revenue you can see it is achievable.

“They have been in a recovery phase for a few years, which is why the board have been putting so much money.

“Now, having won the Premiership and made an imprint in Europe, they have reasonable control of costs and should now be moving towards a sustainable model.

“And they have got players they can sell. Compare the Rangers model to that of Celtic. Celtic normally sell a player or two every season and bring in an eight-figure amount.

“Rangers now have the talent to sell. They have players who are coveted elsewhere. When they start to sell it will have a significant impact on their financial results.”

Discussing the potential impact of the club’s 150th anniversary on merchandising sales, Maguire talks up a range of new revenue sources which the club will hope to take advantage of.

Whilst an increase in merchandise will be important, the finance expert also points to player trading and the coveted Holy Grail of Champions League qualification.

“Winning the title again and getting into the Champions League group stages will have a huge impact,” said Maguire.

“For every £1m generated in the Europa League you get £3.5m in the Champions League. That is purely from prize money.

Champions League qualification would have “huge impact” on Rangers

“If they do get into the Champions League group stages they are likely to be a third or a fourth seed.

“So they are likely to have two big clubs coming to Ibrox which will mean they are able to charge maximum money for hospitality lounges and for commercial activities for those games. That will have an additional impact on their matchday income.”

Champions League qualification would represent a major cash boost for Rangers. (Photo by TF-Images/Getty Images)

There has also been much said regarding investor loans into the club and as Maguire explains, there is no imminent pressure to repay these investments.

Not only that, but much of these loans have been converted into shares of the club.

“There is no pressure to repay those loans,” said Maguire.

“The loans they have received from directors are converted to shares. So the pressure to repay loans that you see at some other clubs doesn’t exist.

“If you look at the cash flow statement you can see they have borrowed almost £30m during the year. But a lot of that was converted into shares.”

Rangers are under increasing pressure to cash in on top assets like Alfredo Morelos. (Photo by Ian MacNicol/Getty Images)

Rangers fans are well aware of the need for player trading and will be readying themselves for exits but the fact it has not happened to date says more about the ambitions of those running the club than it does about impending financial doom.

Rangers knew that psychologically not only getting 55 was essential to the club’s redevelopment but doing so before Celtic got their own 10IAR was massive in the framework of Scottish football.

This is a gamble which paid off for the club with the winning of that title but now elements of the business plan must be adopted with greater urgency, something Maguire clearly feels will happen in the months to come.

Meanwhile, Rangers chairman Douglas Park has sent a drastic warning to Scottish football about the game north of the border being undersold by the governing bodies.


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