Rangers have released figures which confirmed the club's net debt had soared to £31.1million.
The Glasgow giants released their annual financial report which showed their debt had increased by almost £10m for the 12 months up to June 30, 2009.
Despite winning the Clydesdale Bank Premier League, the Homecoming Scottish Cup and reaching the final of the Co-operative Insurance Cup, the club showed a loss for the year of £12.7m, against a £7.2million profit for the previous year.
The turnover for the club decreased by a massive £24.8million to £39.7million.
Martin Bain, chief executive, claimed defeat by FBK Kaunas in the qualifying stages of the Champions League, which eliminated Rangers from Europe altogether, was to blame for the dramatic decrease in income.
In a statement released to the stock exchange he said: "The early elimination from European competition together with the reduced number of games resulted in turnover decreasing to £39.7m from the record high of £64.5m achieved in 2007/08.
"In total 49 games were played in all competitions in 2008/09 as against 68 in the prior year.
"This had a detrimental impact on ticketing and hospitality income, whilst the commercial area of the business suffered due to the lack of income from UEFA for European participation.
"Ticketing and hospitality income decreased by £11.7m to £24.2m due to the reduced number of home games both in European and domestic cup competitions.
"Ticket sales bore the brunt of the decrease with only 22 home games played in 2008/09 in all competitions as against 32 in the prior year."
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