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Rangers losses leave club relying on interest-free loans

The club's operating expenses increased by almost £8m to £32.9m in a year.

Dave King: Rangers chairman.
Dave King: Rangers chairman. SNS Group

Rangers made a £6.7m net loss last season and are relying on chairman Dave King securing the release of a similar amount of money to allay fears over their ability to continue as a going concern.

The losses - revealed in the Rangers International Football Club plc annual accounts - are double that of the previous campaign, when the club were in the Ladbrokes Championship.

Season ticket sales increased and non-ticket revenues were up by 55 per cent but operating expenses increased by almost £8m to £32.9m.

The accounts - for the year ending June 30, 2017 - revealed Rangers had outstanding interest-free loans totalling £15.9m from investors.

Recent loans include money received from King's New Oasis Asset Limited group, which is the biggest shareholder in the club.

The report, which was released after 8pm on Friday night, added: "At the time of preparation, the forecasts identified that the group would require a minimum of £4.0m additional funding by the end of season 2017/18 in order to meet its liabilities as they fall due. The first tranche of funding is required in November 2017.

"Further funding amounting to £3.2m is forecast to be required during the 2018/19 season.

"However, the final amount is dependent on future football performance and European football participation amongst other factors. 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.

"With the appropriate assurances obtained and the continued support of the investors, the board believe that such uncertainty has been removed."

King's lawyer was last month quoted as describing the South Africa-based businessman as "penniless" in the Court of Session, claiming that he did not have control over the finances of 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 2016. A judge could rule that King has to lodge offers for the rest of the club's shares.

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