Rangers Losses Double: Club Relies On King Loans
4 November 2017, 08:24
Rangers made a £6.7million net loss last season and are relying on chairman Dave King to stem further shortfalls over the next 18 months.
The losses - revealed in the Rangers International Football Club plc annual accounts - are double that of the previous campaign.
Rangers had to pay a £3million one-off sum to release themselves from an unfavourable retail contract with Mike Ashley's Sports Direct but more cash shortages are predicted.
The accounts, for the year ending June 30, 2017, revealed Rangers received almost £6million in interest-free loans from directors and other investors, £3million of which came from King's New Oasis Asset Limited, which is the biggest shareholder in the club.
The loans took the total debt to £15.9million - of which £6.7million is owed to New Oasis.
The report, which was released after 8pm on Friday night, predicted the club would need £4million of additional funding this season, some of it this month, and a further £3.2million next season.
It added: "The board have discussed the club's forecast cash shortfall and have reached an agreement with New Oasis Asset Limited whereby they will provide additional loan facilities as necessary to meet the above requirements.
"Further to this, New Oasis Asset Limited and certain investors have agreed to extend their existing loan facilities to July 2019.
"The board is satisfied that those parties will continue to provide financial support to the group and have satisfied themselves as to the validity of the undertakings.
"The board acknowledge that had these assurances not been secured then a material uncertainty would exist which may cast doubt over the groups' ability to continue as a going concern and therefore its ability to realise its assets and discharge its liabilities in the normal course of business."
The report was released seven days after manager Pedro Caixinha was sacked along with several members of his backroom staff.
The Rangers board hope to turn debts into equity but have twice failed to secure enough votes from shareholders to facilitate their plans. The next annual general meeting is on November 30.
King's lawyer was quoted last month as describing the South Africa-based businessman as "penniless" in the Court of Session, claiming he did not have control over New Oasis.
King is awaiting a judgement after the Takeover Panel instigated action claiming that he acted in concert with other shareholders to assume control in March 2015.