The Ibrox accounts were published yesterday to much fanfare in the media, which for the second year running announced that the club had posted a profit.
But for the second year running our lazy hacks have been conned by a headline claim with little basis in reality. Last year when they posted an “operating profit” their loss was almost £1 million. This time around, their “operating profit” was under that. The actual loss was more than £4 million.
The current Ibrox operation has never turned a profit in the 12 years of its existence. Year on year losses are made up by members of the board offering short term loans in exchange for shares; what we have taken to call “equity confetti.”
Toilet paper is worth more than the average Ibrox share certificate.
Those accounts record that another £3 million worth were issued in the 12 months those accounts ran to. “Included within financing activities is the net receipt of loans from investors totalling £4.9 million,” says the executive summary.
That’s how they got through last season. And the media reported them as being profitable because that was the spin Ibrox put on it when they released the figures.
It takes two seconds to see what the “net loss” figures are, the ones that matter.
What a joke that is. What a joke our press corps are.
I wrote this morning about their boast in having the biggest wage bill in the league. That’s an incredible thing for them to be happy about, because the year those accounts cover, last season, was the one in which we won a treble and they finished rock bottom of their Champions League group with no points.
It’s astonishing to think that they were so hapless whilst paying more in salary costs than our club, but it appears to be the case.
The loss of £4.4 million is bad enough, but it came in a season where their turnover levels reached as high as they did with the key sales of Aribo and Bassey on top of Champions League income. They brought in £26 million from those two deals … can you even imagine how horrendous those accounts would look without that money?
If they couldn’t post a profit last season, with Champions League football and those sales, they have no chance of posting one for this campaign.
As an aside, the accounts claim that they spent £21 million on transfer and agent’s fees over the course of this summer and without either a corresponding mega-sale or that Champions League cash. It boggles the mind to imagine just how horrific the figures for this season are going to be.
An eight-figure loss cannot be ruled out. They’ve replaced a second management team on top of everything else, and although they are clearly out looking for “investors” those accounts are not making it more likely that they’ll find any.
Two years ago, their “operating profit” represented a loss for the season they got to the Europa League final. Nevertheless, I genuinely believed that they must post one for the season just past because of those sales and the Champions League cash.
How could they possibly fail to?
And yet they have failed, which raises the question; if they can’t post profits on the back of a European final, or in a season with significant transfer income and the cash from the top table, how in God’s name do they expect to post one in a season like this, when they’ve spent a fortune, replaced a manager and have neither of those things to fall back on?
Those accounts are a disaster for their club, an absolute disaster. I’m hardened to this stuff by now, to seeing how the media reports every set of financial figures over there as if they were a triumph, but it’s hard to over-state how disastrous those numbers are.
Rising revenues, yes, but covering an exceptional period. Rising costs which reflect a trend which continues from the inception of the club into the present day; a club so determined to catch Celtic that it’s risking its very future.
Over the last few months, largely on account of our club’s own failures to produce quality for the manager in the summer transfer window, our financial strength has somehow been weaponised against us.
That should not be allowed to happen. There are various things going on at Celtic right now which some people are in favour of and others are opposed to. Some think the summer window was a success, others think it was a failure.
But whether it’s protests over fans, anger over signings, issues over communication between the club and the supporters or those who think Celtic doesn’t do enough to protect the fans or the team from Honest Mistakes, these things really have to be isolated from the financial performance, which continues to be stellar.
I know a lot of people get angry over cash in the bank when they think it should be out on the pitch, but having a rainy-day fund is no bad thing as the COVID campaign proved. The strong financial position of the club allows us to spend every summer, knowing that we can do so without endangering ourselves.
We can also spend in January, which has sometimes been the difference between winning and losing titles … this cannot be overstated.
Celtic is an astonishingly well-run club, and we do not praise those in charge of it enough for continuously posting profits whilst also being able to keep the team strong. We should not be permitting the media to use our financial strength as a stick to beat us with, and the only reason they do it is to restrict scrutiny of what happens across the city.
Their £4.4 million net loss is contrasted with our £33 million net profit for the same period. Look at their commercial figures; £28 million in total from sponsorship, commercial and merchandising.
As impressive as it sounds, consider this; our revenue from merchandising alone is higher than that figure, at £29.1 million. That’s how strong we are.
They are getting widely applauded for generating £83 million in revenues; our were £119 million for the same period, higher than theirs by £36 million … and that’s for a single campaign. Our £33 million in profits are money in the bank.
Every time they post a loss, they take problems and pile them up in a corner somewhere. There is no “long term” strategy here, no matter what they are telling themselves and which is being repeated in the media.
That club is a damned mess, and they have some massive, and difficult, decisions staring them in the face in January and beyond.
If we win this title, and collect that next Champions League bounty, and they miss out on qualifying along with us, the gap is going to be incredibly hard for them to close. The pressure their board will be put under will be immense.
Inside that club they have to be thinking about what the full impact and implications of those numbers are … whatever spin they are putting on them, the truth of them is known and the consequences well understood.
Expect major turbulence over there before this season ends. They are going to have to find a high seven figure to low eight figure sum just to get through it, and at the same time as their supporters are expecting signings and another rebuild.
They think money grows on trees, these Peepul.
A dose of reality has long been in the offing. With UEFA sustainability regulations now in force, they are certainly heading for one, but even without it it’s clear that they cannot continue to operate like this.