Rangers improve their finances

Rangers’ pre-tax loss in 2022/23 slightly increased from £2.2m to £3.1m, as revenue fell £3m (4%) from club record £87m to £84m and other operating income dropped £4m (82%) from £5m to £1m.

Rangers’ revenue decrease was largely driven by having no European football after the group stage, which led to reductions in gate receipts & hospitality, down £2m (5%) from £42m to £40m, and commercial, down £1m (6%) from club record £20m to £19m. Broadcasting rose very slightly to £25m.

Despite the lower revenue, Rangers still invested more money in the squad, as the wage bill increased £9m (17%) from £55m to a new club record of £64m.  This was partly due to bonuses for Champions League qualification. This means that wages have now grown seven years in a row, nearly quadrupling since promotion in 2016.

Rangers’ results were boosted by their best ever profit from player sales of £23.6m, which was more than twice as much as prior year’s £11.2m, mainly due to the club record sale of Calvin Bassey to Ajax and the big money move of Joe Aribo to Southampton.  The importance of player trading to Rangers’ business model cannot be over-stated, so the club record £24m profit last season was a big step in the right direction, cementing the progress already demonstrated by the prior year’s £11m gain.

Rangers’ have obviously improved their finances in the past few years, but they still made a (small) loss, even with the benefit of Champions League football and very good player sales.

Rangers’ £84m revenue has still grown £25m (42%) in three years from £59m in 2019/20. This means that revenue has nearly tripled from the £29m they generated in their first year back in the Premiership in 2017.

Rangers earned €20.9m from the Champions League in 2022/23, which was £9.0m less than Celtic’s €29.9m. The largest slice by far was the €15.6m participation fee, but this also included €3.0m from the TV pool and a €2.3m UEFA coefficient payment.

Rangers’ gross debt increased by £1.4m from £16.9m to £18.3m, comprising investor loans £13.4m, other commercial loans £3.1m and lease agreements £1.8m. Net debt grew by even more from £3.9m to £13.0m, as the cash balance dropped from £13.1m to £5.3m.  The vast majority of this debt is of a “soft” nature with almost all of it provided by club directors and investors.

Rangers’ business model in recent years has been highly dependent on money from their investors. This adds up to £124m since 2013 with £63m provided in the last four years alone.

Rangers have clearly made a lot of progress on the pitch since the current board took control, albeit supported by significant investment from the directors.    That said, the club still posted a loss last season, even when they competed in the Champions League and made record player sales, so it’s too early to declare victory.