Celtic plc Interim Report

Celtic have released their Interim Report for the six months to December 31, 2023.

Key Operational Items

• 14 home fixtures (2022: 14).
• Participation in the UEFA Champions League group stages, securing 4 points.
• Commencement of the major development at Barrowfield Training Facility.

Key Financial Items

• Revenue increased by 11% to £85.2m (2022: £76.5m).
• Profit from trading was £32.0m (2022: £28.1m).
• Profit from transfer of player registrations (shown as profit on disposal of intangible assets) £2.6m (2022: £1.8m).
• Profit before taxation of £30.3m (2022: £33.9m).
• Acquisition of player registrations of £12.9m (2022: £5.7m).
• Period end cash net of bank borrowings of £67.3m (2022: £59.2m).

CHAIRMAN’S STATEMENT
The results for the six months ended 31 December 2023 show revenues of £85.2m (2022: £76.5m) and a profit from trading, representing the profit excluding other income and player-related gains and charges, amounting to £32.0m (2022: profit of £28.1m). The profit before finance income & expense and taxation amounted to £28.5m (2022: £33.8m).

We benefited from Champions League qualification in both 2022 and 2023 and increased underlying revenue by £8.7m to £85.2m in the first half of 2023 relative to the same period last year. The key factors in this were higher UEFA distributions this year alongside a general incremental upturn in trading across almost all revenue streams. A significant portion of this revenue increase was re-invested into football wages and salaries resulting in the profit from trading of £32.0m noted above. Amortisation charges were broadly in line with the same period last year and gains from player trading amounted to £2.6m for the six months to 31 December 2023 (2022: £1.8m). These principally related to the disposal of Carl Starfelt and several contingent fees that crystalised in the period.

Profit before finance income & expense and taxation fell to £28.5m, down from £33.8m in the prior year, despite the significant revenue increase. This is attributable to the increase in the football-related investment alongside the absence of a significant non-recurring insurance receipt recognised in the prior period.

From a funding perspective, the cash and cash equivalents balance reduced from £72.3m to £67.3m in the period under review. A significant proportion of this cash is committed to the creation of a new training centre at the Barrowfield site, the finalisation of the Lennoxtown developments and future stadium expenditure. The Board recognises the inherent inefficiencies of holding excess cash, and, in conjunction with other cash commitments, the importance of investing in strengthening the team to deliver football success. The Board shares the frustrations of the supporters regarding the less than anticipated activity in the recent transfer window.

Since the opening of the transfer window in June 2023, and up to the end of the winter transfer window which closed on 1st February 2024, we have committed £23.9m in player investment. Within this we renewed and extended the contracts of Cameron Carter-Vickers, Liel Abada, Matt O’Riley, Anthony Ralston and Reo Hatate. The Board’s commitment is to strengthen and improve the playing squad in every transfer window and although resources were available, we were unable to further add to the squad due to the unavailability of identified targets. This was disappointing to us all, and never the intention. The January transfer window is notoriously difficult as clubs are very reluctant to let their best players go at such a crucial time of the season just as we are. Indeed, we resisted strong interest in our players from other clubs.

It is notable that transfer activity in England was the lowest it has been for over ten years, excluding the impact of Covid-19. A number of reasons have been cited for this including the absence of suitable players and new UEFA regulations which impose spending caps.

Although disappointed by the second-round exit of the League Cup away to Kilmarnock, we looked forward to our Champions League draw against Feyenoord, Atletico Madrid and Lazio. We achieved four points in the group stages and, whilst representing an improvement over last season’s two points, we finished fourth in the group stage. We took consolation from a number of good performances which will serve our squad well, but our objective is to keep improving and competing in Europe. Looking towards the year ahead, winning the SPFL and the Scottish Cup is our immediate focus and priority. With 12 matches remaining in the league and having reached the quarter final of the Scottish Cup, there remains a long way to go and all to play for. We will all unite behind the team for these purposes.

We also look forward to the creation of our new Barrowfield facility which is scheduled for the end of 2024 and will bring high quality facilities for our women’s and academy squads. We are also nearing the completion of a significant investment in Lennoxtown delivering new First Team and B Team changing areas and a newly- enhanced medical and sports science facility. Investment in infrastructure is a key component of success in modern football.

December 2023 saw the departure of our women’s team manager, Fran Alonso, to a new opportunity in one of the top women’s football leagues in the world. Fran leaves us with our best wishes after almost four years with Celtic having overseen the transition of the women’s team to professional status and having won the League Cup, two back-to-back Scottish Cups and narrowly missing out on the SWPL league title last season. Fran leaves us in a strong position and was recently replaced by Elena Sadiku. We wish to welcome Elena, at what is an exciting time for the women’s game at Celtic and in Scotland.

UEFA and the European Club Association are close to agreeing the final aspects of the revised European Club Competition model. This will bring an exciting new format to European football and the opportunity to participate in more matches and give access to more teams across Europe. Pending completion of these discussions, this should provide stability and certainty for several years for the European football landscape.

As is often the case with the Club’s earnings profile, we naturally expect a seasonal downturn in earnings in the second half of the year. In general terms, earnings are biased towards the first half of the year aligned to the receipts from European competition, whereas the second half is characterised by significant accounting losses. This is entirely within expectations and our planning assumptions. Our outturn earnings can also be materially impacted by football success and the year-end assessment of player registration carrying values. Taking all of this into consideration, we would expect our total outturn financial performance for the year ending 30 June 2024 to be significantly lower than the result posted for the first six months of the financial year.

On behalf of the Board and everyone at Celtic Football Club, I wish to extend our gratitude and appreciation to our supporters for the backing of our Club. Thanks also must go to our shareholders and commercial partners for their continued support.

Peter Lawwell
Chairman
23 February 2024

 

@Foley1888 looks like they have lumped in the investment at various venues in the accounts to bring down cash at bank.

Basically saying money was there and we couldn't spend it to make it look good. Don't buy that 1 second!

 

"The Board recognises the inherent inefficiencies of holding excess cash, and, in conjunction with other cash commitments, the importance of investing in strengthening the team to deliver football success. The Board shares the frustrations of the supporters regarding the less than anticipated activity in the recent transfer window."

The fact the board even recognises what supporters have been screaming out for since last summer shows how badly things have been managed this season with regard to player acquisition.

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I feel like even the board are now turning on the board.

It should be interesting to see certain posters now having to come on and defend the board from attacks from… the board?

 

Making excuses for people not doing their jobs properly.

I said this in the window but I honestly think we have 1 player identified for a position if it doesn't happen we just forget about it. In Jan the only credible links to a LB was Owen Beck it became apparent he couldn't come after Liverpool played him then it was almost like the LB was parked until the hail mary rumours of Kurzawa.

 

Finally acknowledging the obvious is some kind of progress but doing something meaningful and impactful about it is another.

Self preservation rather than maximising sporting success is most likely their primary motivation but either which way, if that's what it takes to crack the biscuit tin wide open and work to establish high quality sporting infrastructure, so be it.

 

lawwell out,both of them!

 

Oh joy mega money in the bank and losing the league. Just about sums us up

 

This is very odd really looking at the accounts you would make the assumption the money for doing the Barrowfield project must be in there but I have to admit I am struggling to see where other than £1.5m under purchase of property and plant.

The same with the spend on players being over £23m before Kuhn, and the fact they had signed Iwata, Tilio and Holm in last years accounts. It could be the contract extensions I guess as is hinted at in the statements as only just under £13m was actually spent on acquiring registrations. It may be that we owed add ons for players bought in previous seasons because certain clauses were met e.g. CL qualification.

Also where we got £12.5m from sales I don’t know, unless it’s performance related bonuses from previous sales. As all we sold in the period was Soro, Ajeti, Urhoghide, Hazzard for nominal fees and Starfelt.

Overall our receivables and outgoings are now in a positive balance so that would account for some of the cash at bank falling alongside spending £11m more than we received in transfers balanced by a upturn in OPEX profits. Where it looks like OPEX decreased this is only because we didn’t have the £10m insurance payment this year if you take that off last year then it’s about a £5m OPEX profit, and over all pretax profit increased by £6m (if you exclude the insurance payment last year) and we are now due about £4m more than we owe which is a £6m improvement.

Basically financially again everything has increased our revenue via all our main sources football & stadium, multimedia, merchandise and player sales. Our costs have gone up to, player purchases, tax higher rate 25% instead of 19%, and Operational costs.

On the comments on recruitment not being what we expected in the window this to me is another sly nod to the press leaks about Rodgers not wanting who was suggested to him.

 

* the board. Get them all out!!!

Admitting to "holding excess cash" while our team is in as bad a shape as it's been in years is unforgivable.

 

They also are trying to say look we spent £23m on new contracts and players but the reality there is most of that has been very poorly spent so how are you going to improve that?

 

The board members need to pay for this. Every single one of them.

 

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The "unavailability of identified targets" lol.

For that, read: "Nobody was willing to accept a bag of chocolate coins and a satsuma for their players."

Absolute * charlatans.

 

a club like us should have more than one “identified” target for each position,

it’s expected what they have said so nothing of shock value , Peter lawelll knows his days are numbered and it’s just going to get worse for him and I think that’s why they are trying to say we feel the same as you guys.

end of the day they have * it !

Either the board dont feel the managers targets are achievable and the manager will need to go or the Desmond steps in and gets lawwell to * and eases the finances for Rodger’s ! Ange spent relatively big money on 3 signings (jota , ccv , Kyogo) and they have been our better players , jota made us a huge profit , if the board can’t see that spending a little bit more brings you a better calibre of player and the potential for more profit then they need gone !
I don’t mind the small fee signings because you do find a hatate or a oreilly in amongst them but I think we should be bringing in a couple of big value signings to go along side that

 

We will never go bust

 

We’re in a healthy financial position which is always a positive, but that won’t mean supporters acquiesce in the situation. Acknowledgment of transfer inactivity appeases no one.

I feel like there’s a lack of flexibility if our initial targets aren’t available, regardless of the market being slower in the January just passed.

 

Nail on head.

They think we're completely thick.

Words fail me.

* then *.

 

Using English teams not signing players as an excuse for us not being able to sign players is a bit odd when they used to argue we struggled to sign players due to english teams spending too much!

Also, saying our targets weren't available isn't an explanation. Just suggests we don't do due diligence on what makes a player a viable target in the first place.

Probably lots more to pull apart but those two stood out.