RIFC accounts 2016

The annual accounts of Rangers International Football Club (RIFC) were strategically dropped into the mainstream on Friday after close of business.

The full thing can be accessed here.

I’m not an accountant and do not claim to have any special abilities when it comes to analysing a set of figures.

However, I do know a few folk with that professional background.

My go to guy on these matters is Rugger Chap.

He has no dog in the Glasgow soccer feud and he doesn’t care if any club in Glasgow is in rude financial health or is toppling on the precipice of insolvency.

Numbers are his trade and I’m happy to go with his take on the most recent set of accounts for Rangers International Football Club (RIFC).

RIFC is the company that was set up by Charles of Normandy in late 2012.

RIFC was then floated on the Alternative Investment Market (AIM).

RIFC wholly owns the club that Charlie created.

His baby was originally christened ‘Sevco Scotland Limited’, but the big handed man from Yorkshire cheekily changed the nipper’s name to ‘The Rangers Football Club’ shortly after it was born.

However, for those in Planet Fitba who are thirled to the facts it will always be Sevco.

Mr David Cunningham King is the new man in the Big House and little Sevco is now a four year old.

Of course, the stenographers will tell The People what they’re told to tell them.

By such sorcery Craig Whyte was trumpeted as a billionaire in the Daily Radar.

For the avoidance of doubt dear reader I don’t take press releases at face value.

Moroever, when it comes to a set of accounts I get an independent expert to go over them for me.

So here is what my guy thought of them:



Borderline Plausible, but troubles have not gone away.

When I was asked to carry out a review of the accounts of Rangers International Football Club, (RIFC), late on in Friday, my first reaction was that only companies which are imparting bad news via profit warnings, or missing forecasts, or some big issues, release their accounts when everyone finishes work for the weekend. In reading these accounts, my suspicions were confirmed. RIFC has some extreme financial challenges ahead, and despite claims that Rangers football club, (Rangers), requires £3.75 financing to complete the football season, what appears very clear to me is that this club seems to stumble from one year to the next, that, latterly it has relied exclusively on directors and other related parties to survive. A very substantial investment is required for this club to have a stable future. Cumulative losses since RIFC was formed in 2012 are in excess of £18m. This has been funded by supporters in the first instance, but latterly, it is directors and related parties that have propped up the company. It is difficult to predict how long this can continue.

There are lots of details that can be commented on regarding RIFC accounts, but I will try to draw out the main points under the following sections.

  • A review of the back end of accounts, selectively looking at some notes to the accounts.
  • Auditor’s report
  • Strategic review of operations
  • Review of accounts, including liquidity and financing issues.


A review of back end of accounts.

I looked at last year’s accounts to check if any contingent liabilities have disappeared and then look for new inclusions. Last year, RIFC referred to a dispute with SPFL which indicated a potential cost of £250k plus interest and costs. This has disappeared, but RIFC paid this during the 2016 financial year, and this amounted to over £280k. This is included in the income statement.

Since the year end RIFC acquired 11 players at a cost of £3m. RIFC has also committed to spending £0.6m on stadium improvements, although there was no expenditure incurred during the year. It was also noted that in October 2016, RIFC received £2.9m of funding from directors and related parties, but this is a subject that I will elaborate on, later in the report. It is critical.

On contingent liabilities, there is a repeat of a number of issues that were raised last year, so I will not revisit these items again, however, on new items, there are a few interesting points. Rangers are making a claim against Rangers Retail Limited (RRL), for £1m in respect of breaches of Intellectual property rights, although RIFC separately questions the viability of this business and have written down the value of this investment. RIFC has been served a claim by Sports Direct International, (SDI), together with Dave King, Paul Murray, and RRL. This will be heard in London at the beginning of December. The extent of this claim has not been quantified, but RIFC believes that it will not exceed £1m. RIFC, clearly have not made any provision in the accounts. RIFC are also raising a civil action against former directors in connection with stadium sponsorship agreement. RIFC are making a claim for £4.1m. A date for this hearing has not yet been set.


Auditor’s Report.

In looking at the auditor’s report, it looks like Groundhog Day.

There is an emphasis of matter point raised by Campbell Dallas, and this is as a GOING CONCERN. The auditors refer to the note 1 to the accounts and once again, this is critically dependent on raising additional finance, although the amount required by directors is an increase to £4m compared with last year. It is worthwhile highlighting some of the key assumptions that the Directors have used in arriving at this sum.

Rangers will participate in European competition in 2017.

No cash inflow from RRL.

Significant increase in season ticket sales, match day revenues, sponsorship, and commercial income.

Continued overhead cost reduction measures (although this contradicts the statement of Dave King in his chairman’s report)

Payroll costs are reflecting appropriate squad size and composition, (separately there is a reference of 40% uplift in the player budget). Some confusion and inconsistency here.

Strategic review of operations.

Conservative amounts generated from player sales (Implies that there will be net financial disposals to come in January).

There are some statements and details here which do not seem to be backed up in the numbers.

Dave King says that staff levels are returning to more appropriate levels and that Rangers are investing heavily in staff and infrastructure and will continue to do so.

There was no Capex [Capital Expenditure] during 2016, and regarding going concern status, the assumptions are geared to containing costs. Somewhat inconsistent.

Season ticket sales increased from 37k in 2015/16 and now had more than 42k in the current season. Average season ticket price increased from £237 per ticket to £255. Overall revenues increased by c £6m with season ticket representing half of this increase and the Petrofac Cup contributing over £1m.

On operating expenses, these fell by £1.6m to £24.2m; however staff costs were flat, but legal and professional fees were reduced by just under £1m. Excluding legal fees, costs were essentially flat. RIFC wrote down the value of investment in RRL by £0.5m (noncash cost), and the directors are concerned about its future viability. RIFC continue to make an impairment provision on their properties of £786k each year.


Review of accounts and financing issues.

One of the most interesting aspects of the accounts is the substantial change in deferred income. This has increased from £6.5m last year to £15.9m at the end of June 2016.

What is deferred income? In simple terms, this is the commitment that Rangers receive for season tickets and sponsorship monies before the season starts. A substantial proportion of money has been banked but it relates to the next financial year. Clearly, the promotion to the premier league and increased prices has given Rangers a substantial financial boost, but in looking at the going concern comment, RIFC has needed a cash injection of £2.9m in October 2016, whereas this additional funding was not necessary until January in the last financial period.

On the issue of financing, the directors have revised down the total requirement from £4m to £3.75m because of the success in reaching the semi-final of the League Cup. £2.9m was obtained in October, and a further £0.85m will be required in March 2017.Dave King through his company New Oasis Asset Ltd is providing this sum. With bullish comments such as investment in the football squad, infrastructure and returning staff levels to a satisfactory level, this leaves an awful lot to trusting the Director’s comments.

On the subject of continuing financial support to RIFC, the board has received undertakings from certain investors that they have the means and authority and will provide financial support to RIFC. The board acknowledges that had these assurances not been secured then a material uncertainty would exist which may cast doubt over the group’s ability to continue as a going concern. I am sure that the directors have furnished sufficient documentary evidence to the auditors Campbell Dallas to back up this assertion. Going further, the directors have said that financial support will be made available to more than cover any projected shortfall. I am sure that this proof is well documented.

Who is providing this additional finance?

The group is split into three main categories. New Oasis Asset Management, a company controlled by Dave King is owed £3.7m, and he will contribute a further £0.8m in March. Some of this debt was due to be repaid by December 2015, but this is now extended to December 2017.The Director’s, Bennett Park and Murray are owed £2.5m, some of which was also due to be repaid by December 2015. This is now due by December 2017.Other related party loans and new investors, Taylor, Letham, Andrew Ross, Barry Scott and Scott Murdoch are owed £3.8m of which £2.4m was granted during the year. So in total £10m is owed, albeit £8.9m is recorded on the balance sheet.

This is due to an accounting standard which discounts the debt to factor in an implied interest rate to assess fair value. The real debt repayable is £10m at June 2016 but assuming directors’ forecasts are accurate; some £14 will be due by the end of March.



These accounts are detailed and present a lot of information which requires careful reading.

I could write a lot more on this subject, but believe that the main issues are addressed.

I am looking purely at the accounts and do not consider issues such as further legal costs, repair costs of the stadium and other items, but the conclusion is very clear. In my opinion, RIFC is a financially distressed company whose debt is rising, and repayment dates are being pushed out.

I am not in position to judge the resale value of the playing squad as this could provide some funding relief, but fundamentally this company will remain vulnerable, because of its lack of credit facilities, until, in my opinion, an investment of approximately £30million is made.


Ok, so that was his take on them. The Holding Company Vehicle remains a loss-making business without a credit line from a bank. I think it is fair to say that they are currently limping on in a hand-mouth existence and kept afloat by Director’s loans. Until that £30m miraculously appears then that isn’t likely to change anytime soon.

Have a good Sunday.

27 thoughts on “RIFC accounts 2016

  1. Overandout

    Whats going to happen to them in the next year or two…

    worst case scenario? ( for them)

    best ( again, for them) case scenario, within reason?

  2. Succulent Humble Pie

    Rangers’ financial problems are easily fixed but it would require humility.

    Accept where the club is at in terms of finance and assemble a squad of players on a similar budget to the likes of Hearts and Aberdeen. Compete with them for a few years and maybe win the odd cup while Celtic run off with 12 in a row league titles or however many. When the debt is wiped, then and only then, start looking to challenge Celtic.

    But it won’t happen because they demand that they win the league this year or next year and, frankly live in Cloud Cuckoo land.

    In his Chairman’s report, that most fit and proper of chaps, Mr Dave Cunningham King says, “The ultimate aim continues to be to regain our position as Scotland’s top Club, and one of the top clubs in Europe.” and mentions support that is “vital if Rangers is to regain a position of domestic dominance and re-enter the European arena.”

    In his business review he says “This Board will never shirk its responsibilities and will not rest until Rangers is reunited with regular triumphs”.

    Humility is just not possible alongside that sot of rhetoric.

    However, in the strategic report the club is referred to as “one of the world’s most successful clubs”. While I believe the reference is actually related to a different club formed in 1872 rather than 2012, the fact it doesn’t state THE world’s most successful clubs is possibly an indication that some degree of humility is possible after all!

  3. Walter Mitty


    Sorcery and trickery in the darkened recesses of the funding department is abound, however smoke and mirrors will not suffice at the end game. RIFC is a cunning creature which has survived many a battle with the financial reaper, cut off one head and another appears. It does however have an important Achilles heel which will be its ultimate downfall. Greed…

    Pea the weeple, all the kings horses and all the kings men will not be able to breath live into a slain dragon once the mythical European fire of 2017 has been snuffed out. The dragon slayer cometh in the guise of Sir Brendan of Glasgow. With the victor comes the spoils.


  4. jed

    I was of the opinion that Financial Fair Play rules stipulated that clubs stood on their own feet (generated income) this stopped Manchester and Chelsea etc. having billions pumped into them by owners, benefactors etc. Sevco to me are yet again, pumping Scottish football

  5. timalloy67

    As your Rugger chap points out a lot of this is dependent on taking Mr King’s word as gospel, not a good idea, and as for the “european cash plan in 2017” has he checked the coefficient tables lately, IF they somehow get top 4, they will have to negotiate 3 tricky europa league qualifiers all unseeded to gain their “pot of gold” oh and in europe draws there will be no SFA “hot/cold” balls to help them with easier teams to play lol

  6. Peter

    Phil; I realize this is probably a stupid question, but how can the SPFL & SFA allow this to go on? The accounts state clearly they are reliant on competing in Europe next year to stay afloat. What does this say to every other club in Scotland that lives within its means in Scotland.

    And one last thing, if I was one of the teams in competition with newco for Scottish Cup or finishing top 5 then it has been established that SFA will be compromised. In any decision with refs, home games, scheduling then they will lose out to newco as priority 1 is keeping newco going. Anyone thinking there will be more than normal “honest mistakes”?

  7. Auldheid

    It’s simple if TRFC are dependent on UEFA money then how do their competitors who aren’t know this dependency will not affect their chances of qualifiinG on sporting merit?

    1. Hobo Harry

      Auldheid – do the FFP regulations even allow Sevco to play in Europe next year given their cumulative losses over the last 3 years?

  8. sligojoe

    Debt rising and the fundamentals of the business remaining staus quo. Loss making and no credit line.

    No listing looks likely either or a NOMAD. It’s nice to hear rugger chap estimate that an investment of £30 million is required. Where have I heard that figure before?

    The boys in the blue room are taking a punt on UEFA competition in 2017. A high risk strategy. Clumps posted a photo of the Sevco directors at Hampden when Hibernain scored the winner in the cup final and without a caption, the message was clear. All except Steward Roberston were staring ahead in disbelief. Robertson’s head was down and he was staring at his shoes. European cash had just rode out of town yet again and they all knew what it meant.

    They’ve come up with emergency cash in order to see the season out and, hopefully, get that vital European money into their cashflow. If they fail in that attempt, will they role the dice again and hopefor European salvation in 2018?

  9. SeanyD Tenerife

    I know its been said a hundred times already, but with Brendan and his impact on our team, and this farce continuing to to entertain us off the pitch………what a time to be a Tim! Lap it up lads, these are the good years!

  10. John Collins

    Enjoyable read as always Phil ,there in a mess on and off field ,they forcasting next year revenue on champions league football next year that won’t happen for at least 3 years at least I suspect best they get is europa cup at £2 million for qualifieing not the £30 million pluss we be getting there dreaming champions league to save there arses simply won’t happen the gaps to big still think they be lucky be 3rd or 4th in league if they survive to next year accounts and I still think administration is going happen this year then they will defenentally die next year when no champions league money arrives …with the roof repairs and water charges agent Ashley and god knows how many other legal matters that WILL pop up over next few months there drowning in debt ,delusion of grandeur but they are pople …with no credit line Glasgows Green And White donation made Phil

  11. speyside lhad

    so deferred income has risen from 6.5 million to 15.9 million yet external finance is needed in october whereas last year external finance was not needed until january

    tick tock indeed

  12. joe mccormack

    Compare and contrast with the equivalent Celtic numbers.

    Over the last 10 years Celtic ‘ s lowest reported revenue has been £50m, this year could see the number rise to £90m plus with additional ST sales, CL monies, 50th Lisbon anniversary pushing up merchandising income, and a treble would help as well.

    These are numbers that King Co can only dream of but with the current board in place no outside investor will touch them with a bargepole.

    The notes to the accounts are full of contradictions……on the one hand there is talk of containing the cost base then on the other there are references to further investment in the squad and money to be spent on the stadium, oh and a short sentence referring to player disposals in January.

    Any increase in revenue in the current financial year will be more than matched with the reported increase in payroll costs. There will be no Petrofac Cup income and no run to the Scottish Cup Final if crossing paths with Celtic along the way further reducing comparative year incomes.
    Walk up income for league games will fall off in the last third of the season as Celtic wrap up 6 IAR.

    Those who have donated the loans have to be applauded as they will have done so without security of any kind. ………images of the lenders going to sleep at night muttering ‘In King We Trust’ come to mind.

  13. Tictalk

    Crumbledome valued at £62.2m and auchenhowie valued at £13.35m ? When they were bought together for £5m only four years ago.
    It might be Halloween but this is sorcery of Harry Potter proportions.
    They’ll be trying to tell us next that “waggy” Waghorn is worth £1m+

  14. Joe Keane

    Superb. Your rugger dude has provided a forensic breakdown of why RIFC remain in deep brown and the positive spin coming from the L5 spoon feeders is just orange flavoured kool-aid to keep ra peepul swallow swallowing. RIFC is an unsustainable proposition, and while the basket of assets will limp on like a snarling wounded beast, it is surely only a matter of time before a trail of blood leads to a corpse lying in a ditch surrounded by flies and maggots. A carcass that will no doubt be fought over by various rodents until just its bleached bones are left to bake in the sun. A fitting end to the zombie monstrosity born of lies, corruption and deceit. I hope it rests in permanent peace.

  15. NT

    Read very carefully through all that. It answers a question I regularly ask here…. how are they still going….. it’s one soft loan to another. emotional investment as you call it Phil.
    The list of people from lethal to park to Murray. Whatever happened to the easdales money owed?? They have had to bite the bullet on that haven’t they?? One by one they are walking in then walking away

  16. Agrajag

    Thanks for that, as ever sticking to the facts and going to someone who actually knows what they are talking about.

    I would just add one thing. They have confirmed what you have been saying, in their audited accounts. They are basically a cash business, relying on loans from their directors just to keep the doors open. If they run out of money or the directors have had enough then those doors close.


    The RIFC Group maintains cash to fund the daily cash requirements of its business. The Group does not have access to any further banking facilities.

    There are interest-free, unsecured loans with investors amounting to £10.025 million, whilst the Group also has a fiance lease agreement totalling £0.1 million.

    As at 30 June 2016, the Group held £2,958,000 within cash and bank balances.

  17. Gordon

    Why are TRIFC able to trade while not having the money? The ‘investment’ is not really being put In and gifted to the club, it is merely loans that need repaid. Obviously the directors are not real fans and prepared to actually put their money into the club as a gift.

    Why is ‘old Co’ referred to instead of Rangers Football Club PLC when talking about the liquidated entity? Using ‘Old Co’ and ‘New co’ just confuses people into thinking that Sevco Rangers is the same as RFC PLC?

  18. thornbird385

    In recent seasons Sevco have made visits to the Statelet to participate in fund raising ventures at Windsor Park for both their own benefit and for others including some of their musically challenged supporting brethren.
    Given the grim contents of these accounts, which are laid bare by the clear analysis of your rugby pal, perhaps the fledgling company might look for a similar fund raising venture against a football team from the far end of the province.
    In which case we could look forward to the headline:

  19. JimBhoy

    Yet typically it is being rejoiced that losses have lessened from last year and they have paid off an SFA debt or part of that did not need to be paid. They still have a chunk of that to pay that I am sure the SFA will deduct from maybe the Scottish cup revenues the club will be entitled to.

    Have they paid for Celtic’s bogs yet?

    BFDJ stating they will bring in 3 or 4 in January and move on a couple of fringe players. I think he may have that half right but I cant see any new faces.

    King writes a threatening note to Warbler, not quite a vote of confidence but more of a threat, good to back your manager. Threats seem to be the way of Ra Peepul.! If Warbler has a couple of years in contract they can do nothing as it will cost to pay that up and they will barely see the season out as it is.

    Lookout for all the home Scottish cup games to come for sevco.

    The Nov hearts game thru to the NY day game will see them struggle against the decent sides as they are in a false position in the league now. There are at least 4 teams that are better than Sevco.

  20. sauzeelegod

    Always a fascinating read . With all the goings on at ” The Big Hoose ” It’s been a truly wonderful experience to stumble across these blogs about a month ago , compared to what ive had to put up with through the #SMSM all these years . Small donation made . Thank you & keep up the great work
    ” The truth is rarely pure & never simple ” Oscar Wilde “


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