A Look Back into the Archives – Rangers’ Unaudited Results to June 2011

Who can recall those long ago days of late November 2011?

Remember when Rangers Football Club PLC was not in administration (well, it’s technically not in administration now, but should go back into it on Monday)?

Remember when we had never heard of Duff & Phelps, and when Craig Whyte and Rangers were employing Mr Misha Sher to be their Director of Global Partnerships and World Domination?

Remember when there was the fanfare about the opening of the London office, although I am not sure anyone ever found out where it was?

Remember when, to most supporters of Rangers, Mr Whyte was still the greatest thing since sliced bread, and to the Scottish media, the greatest thing since succulent lamb?

Who would believe those halcyon days were less than four months ago!

I want to look at the Rangers results which came out on 30th November. These were unaudited, and despite promises by Mr Whyte they remain so.

They were announced to the PLUS SX (remember when Rangers shares were still traded there?)

I thought a wee look back at the thoughts of Chairman Whyte might be of interest. His statement is in bold, with my comments beneath.



When I became the majority shareholder and Chairman of this great football club in May this year, the sense of honour and privilege I felt was overwhelming. Those feelings are stronger than ever within me now.


I suspect by November 2011, there were a great many feelings stronger than ever in Mr Whyte! Honour and privilege might have had significant company!


First, I would like to address what matters most to every Rangers fan – football. In recent years the performance of the players and the football management team has been quite magnificent and I would suggest their achievements rank among the Club’s greatest.


Three successive League titles, three out of the last four Scottish League Cups, plus two Scottish Cups and a UEFA Cup Final appearance is extraordinary by any standard and set the seal on Walter Smith’s outstanding second term as Manager and a truly remarkable managerial career. Every Rangers supporter owes him an enormous debt of gratitude.


The outcomes mentioned by Mr Whyte were fine achievements. How many, if any, came from teams receiving untaxed payments and how many had “second contracts” we will await the decision of the various bodies upon. It might, in a footballing sense, be going a bit far to describe the trophies won in recent years as among the Club’s greatest, as the Rangers roll of honour lists many outstanding achievements, but I will leave that debate to Rangers fans. There can be no doubt that it was a significant feat for the Walter Smith led team to win the number of prizes it did.

With hindsight it already seems a bit Freudian of him to be mentioning “owing” and “debts”!


Walter also left the Club in good hands and Ally McCoist, Kenny McDowall and Ian Durrant are showing the same tremendous drive for success. All of us wish them – and the players – continuing success this season.


A footballing point – if Rangers had not fallen into administration, might Mr McCoist have been dismissed by now? Is he that rare individual, one who owes the continued existence of his job to Insolvency? Again, I will leave that to people better qualified than me to debate.


In May, the Club entered a new era both on and off the pitch. Whilst this Statement covers the 12-month period ending on 31 June 2011, it also affords us the opportunity to look forward.


Some unkind people have made cruel comments about Mr Whyte’s veracity. However, what he says here cannot be faulted. “In May the club entered a new era both on and off the pitch.” However few realised quite what horrors the “new era” would bring, and so quickly, for Mr Whyte and Rangers.


I am the first to recognise the contribution that my predecessor as majority shareholder, Sir David Murray, made to Rangers over 20 years. With any change in ownership, however, there will be a change in approach and I firmly believe the changes I have implemented will be in the longer-term interest of the Club, which must always come first.


Mmmm… An interesting one here – Mr Whyte’s tune has changed recently, although to be fair to him, he did not say Sir David’s contribution was positive. Instead he “recognised” it. In the same way the Captain of the Titanic is believed to have “recognised” the contribution of the iceberg to the trans-Atlantic crossing!

It was true to say there was a change in approach – the company underwent an Insolvency Event! I suspect that there are many Rangers fans now who would not think that Mr Whyte was putting the “long term interests of the Club” first!

We have a new Board. In addition, we have appointed a new Chief Operating Officer to drive the business forward and take advantage of emerging opportunities and a Director of Football, whose role is to help Rangers maximise every opportunity to develop, attract and retain playing talent, as well as ensure the Club engages productively with football authorities at domestic and international level.


A new Board? All gone, apart from Mr Ellis who arrived only in January.

A new Chief Operating Officer? One of the four (!) people made redundant by the administrators so far!

A Director of Football? Another 25% of the redundancies represented by Gordon Smith.

Ensuring the Club engages productively with football authorities? SFA investigations, SPL investigations, declarations that Mr Whyte and apparently Mr King are not “fit and proper”! I think it is fair to say that Mr Whyte did not hit his Key Performance Indicators on this goal.


Perhaps the biggest change that has been effected since the takeover in May has been the repayment of all bank borrowings. The Club is no longer reliant on bank funding, nor does any bank control our operations on a daily basis.


Brilliant! “The repayment of all bank borrowings!” Hurrah! What the statement did not say, even though it was widely known by then, was that Mr Whyte’s Rangers FC Group Ltd had paid off the bank, and the floating charge securing repayment had been assigned from Lloyds to Group. Rangers Football Club PLC still owed the £18 million plus. It no longer owed the bank, but it still owed the money.

Mr Whyte is also a man who accentuates the positive – not being reliant on bank funding = no overdraft and therefore very tight cash flow.


I hope fans would share my view that, looking ahead, the Club should do everything to live within its means and operate on a commercially viable basis. I firmly believe that is the only sustainable, long-term strategy for Rangers.


Who can object to living within ones means on a commercially viable basis. However, how does this square with the statements by Mr Whyte about a £10 million black hole? Perhaps that slipped his mind?


Performance on the field has a direct bearing on the Club’s business performance. Participation in the UEFA Champions’ League remains important although increasingly difficult to achieve given the qualification process for the SPL champions.


As we have now seen, qualification for the Champions’ League was essential. It has been the failure to manage this that has caused many of Mr Whyte’s problems.


During 2010/2011 we qualified for the UEFA Champions’ League and played in the UEFA Europa League. Turnover at GBP57.2m for 2010/11 was an overall increase of GBP 0.9m over the previous year. Gate receipts and hospitality sales increased overall by GBP1.3m to GBP27.1m, due to the extra European games games, although there was an overall reduction in season ticket sales, hospitality sales and sponsorship revenue.


On a side note (not a side letter I hasten to say) the word “games” is repeated that way in the press release.

Already there was a reduction in sales of season tickets, in hospitality turnover and sponsorship. This despite the success of previous years.


Net operating expenses increased by GBP3.6m to GBP47.5m reflecting increased salary levels, higher European fixture costs and operational cost increases across the business.


Mr Whyte has told us that, from an early stage in his stewardship, he knew the problems Rangers faced with cash flow. He refers here to increased salaries. He further increased them for some of his top players, all at the same time as the £10 million black hole was known about by him!

Was this like a gambler doubling and redoubling his stake to chase his losses?


The Club remains embroiled in historical tax issues with Her Majesty’s Revenue and Customs, primarily the tax tribunal on Employee Benefit Trusts. It has been a dark cloud hanging over the Club for far too long and any resolution must enable the Club to move forward.


“Embroiled” can mean to be involved in a dispute or argument, or to be placed in a state of confusion and disorder. When we all thought he meant definition number one, he actually meant number two!

Remarkably we are still awaiting the Tax verdict, but even before that the Club is in administration and most definitely not “moving forward”.


Rangers has never been short of challenges in recent years and there is no question there are many challenges ahead for both the Club and Scottish football in general. However, I am certain that, as a Club, we can rise to these challenges and deliver success both on and off the pitch. That is what Rangers is all about.


Here again Mr Whyte is spot on. It is quite true that there were many challenges to come. However, his aim of success off the pitch, as well as on, seems to have passed him by.


I would like to take this opportunity to thank all supporters who have offered me so much encouragement. Your support for the Club is inspirational and I can only promise to ensure that the interests of Rangers and our fans will be at the heart of everything I do as Chairman.


A huge pinch of salt is required before those words could be said with a straight face.


Craig Whyte, Chairman


The accounts can be viewed here – Unaudited Accounts to June 2011 – Rangers Football Club PLc

These figures make even more interesting reading in light of what we know now, or think we know now! There is a provision of £3,270,000 for the “wee tax case”. There is none for the “big tax case”.

Nowhere in these figures can I see anything that would reflect the sale by Rangers of its season tickets for the following years to Ticketus. These accounts are the simple proof that the Ticketus cash did not go through the Rangers’ accounts, instead going through Group, we all assume.

Maybe the problem with audited accounts is that, in relation to the sale of one-half of the company’s future income over the next three years, the auditors felt this needed to be mentioned?

In that case it is a clear indication, I think, that he viewed an insolvency event as something for sooner rather than later. If that assumption is correct then he could have had no intention of producing the audited accounts, as to do so would reveal the Ticketus situation.

Any aspiring spin-doctors out there should pay careful heed to these figures and the statement. It is amazing what good can be found in a negative report, if you look hard enough for it, and where many people will not read far past the headlines.

One imagines that, in trying to unravel the Ticketus deal, counsel for Rangers might want to introduce what the auditors proposed to say about the matter, in an effort to support their efforts.

We shall see.

As a final comment on these figures, released by the Board at the time, and not just Mr Whyte – could it be seen as “the dissemination of information by any means which gives, or is likely to give, a false or misleading impression as to a qualifying investment by a person who knew or could reasonably be expected to have known that the information was false or misleading.”

If so, this could constitute “market abuse” under Section 118 (7) of the Financial Services and Markets Act 2000. The penalty already imposed on Rangers Football Club PLC by the PLUS SX for failing to disclose Mr Whyte’s prior disqualification is derived from the same Act.



Filed under Administration, Craig Whyte's Companies, Financial Services and Markets Act 2000, Rangers

6 responses to “A Look Back into the Archives – Rangers’ Unaudited Results to June 2011

  1. Drew Adamson

    I stand to be corrected if anything I say is materially wrong, but is it not fact that CW is still the owner of Glasgow Rangers FC?
    As far as I can see, in contrats to D&P’s belief, no crime has been committed in the actual purchase of the club. I believe the pre-transaction deal between Ticketus & CW is called an Agreement of Intent, and is a common business practice when sourcing finance for the restructuring of companies subsequent to purchase. So, the purchase is separate to the deal.
    He bought the club for £1 plus a pledge. What’s a pledge worth? To quote Simon & Garfunkel, “All lies and jests, still a man hears what he wants to hear. And disregards the rest.” Now, that does sound familiar, bluenoses not hearing the death rattle.
    SDM says to CW “ ’ere,son ,wanna buy a football club for £1? Wee bit o debt, but nothing that can’t be schmooshed. ” “Sounds kosher, guv, ‘ere’s a quid.” “Ta”, says SDM, “I’m walking away.”
    CW opens his jacket in Ticketus ‘s office to reveal a large brown package in a secret pocket “Genuine SPL season tickets at a good price, £24m. Interested?” “Sure, we do exactly what we say on our tin.”
    CW goes to Lloyd’s bank “Can I give you £18m?” When he’s had his hand sewn back on, he sticks the balance of £6m in his piggy bank.
    The only possible crime here is the last bit, illicit transfer of company funds, but even that depends upon which account the money ended up in, as even in Groups it should be legal as that is the holding company, right?
    It’s surprising just how much fluff and upholstery certain tabloids will produce to fill a page with enough pap to keep the Loyal readership happy, and to lead them along the yellow brick road, to the pot of gold waiting at the end of the rainbow. Oh, wait that’s another fairy tale. The one where all the Berrs wake up and discover it’s all been a bad dream, and they are back home in Kansas. Jeez, at this rate I’m likely to get headhunted as a journo for the Daily Ranger!!!

  2. “financial assistance”?

  3. shuggy mcglumphy

    Excellent post and reply by Drew…..My thoughts exactly…Craig Whytes actions are bordering on the illegal ,but thats his skill..pushing the boundarys of sharp practice….refreshing to read something not influenced by mac giolla bhains sheep.

  4. JenPen1975

    What I haven’t seen mentioned n any of the articles either by bloggers or the MSM is a reference to the other shareholders in Rangers. Please correct me if I am wrong, but I thought that SDm owned only 65% of the available shares and that is what he sold to CW for £1. Thus, isn’t the transfer of assets, the season tickets, to a company full owned by CW somehow depriving the 35% of their share of the £24M?

    Couldn’t the same have been achieved by asking the bears to pay 3 years in advance for their season tickets?

    • Jen,

      Mr Whyte’s company bought 85% of Rangers Football Club plc. Mr King owns about 5%. The remaining 10% is split amongst about 35,000 individual shareholders.

      On the basis that the company is effectively worthless, then so are the shares. However, there are rights that the shareholders have, and the minority shareholders are rarely mentioned in this whole mess.

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