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Celtic PLC Interim Report 2012
Celtic PLC have released the Interim Report for the six months to December 31, 2012.
• Progression to last 16 of the UEFA Champions League.
• Currently top in the Clydesdale Bank Premier League.
• Continued participation in the Scottish Cup.
• Announcement of new shirt sponsorship deal with Magners commencing 1 July 2013.
• Turnover increased by 71.0% to £50.06m (2011: £29.27m).
• Operating expenses increased by 30.2% to £36.96m (2011: £28.39m).
• Profit from trading of £13.10m (2011: £0.88m).
• Profit on disposal of intangible assets £5.20m (2011: £3.15m).
• Profit before taxation of £14.94m (2011:£0.18m).
• Period end net bank debt of £0.13m (2011: £7.05m).
• Investment in football personnel of £4.65m (2011: £4.44m).
• 19 home fixtures (2011: 16).
I am pleased to report on our financial results for the six months ended 31 December 2012. The introductory page to these interim results summarises the main highlights.
On the pitch it has been a memorable and highly successful period. We started the new season as Scottish Premier League Champions and, since then, we have enjoyed impressive results. At the time of writing, we have a healthy lead in the race to retain our Premier League title and we remain in the Scottish FA Cup.
Of greater significance, though, has been the achievement of qualifying for the last 16 of the UEFA Champions League, the undoubted highlight being our victory over Barcelona at Celtic Park in November. Celtic surpassed the expectations of many by progressing into the competition’s knockout stages from a very tough group. Furthermore, the club’s international reputation and standing received a substantial boost. This success had a major bearing on our financial performance in the period under review.
The revenues generated by the team’s success in Europe this year have significantly impacted our half year results, with turnover increasing to £50.06m, a 71% improvement over the previous year. Celtic’s achievements, both domestically and in Europe, have had a similarly positive effect on merchandise and ticketing income, notwithstanding the current difficult economic climate.
The results on the park and additional matches produced an increase in operating expenses to £36.96m and our profit from trading, before asset transactions and exceptional operating expenses, was £14.94m - a significant uplift on last year’s figure of £0.18m for the same period.
As in previous years, we continue to make investments in the playing squad and support services. The management of the playing squad is an important aspect of our business model. In the period under review we invested £4.65m in strengthening the first team squad, and added to this in the January transfer window.
We have a talented first-team pool, with a strong emphasis on youth. Our scouting and player identification processes continue to bear fruit, and our investment in state of the art medical and sport science facilities at Lennoxtown has contributed to optimising performance. Similarly, the ongoing strategy of investing in our Academy is yielding its own benefits as we remain committed to finding, coaching and developing Champions League quality players.
Such investment and player development initiatives have further enhanced profitability, with a profit from transfer activity of £5.2m, largely as a consequence of the sale of Ki Sung Yueng to Swansea, in comparison to £3.15m last year. Nevertheless, we have managed to strike a prudent balance between trading successful, valuable assets and retaining key talent to enhance our prospects of football success. Our financial strength meant that we were able to retain all our key players through the January transfer window and further enhanced our squad with the signing of Rami Gershon, Tomas Rogic and Viktor Noring.
The improvement in trading has impacted on our period end net bank debt, which stood at £0.13m, nearly £7m less than at the same point last year, well within the Company’s facilities. Our success on the park and the maintenance of our robust business model has provided stability in a challenging environment. The second half of the 2012/13 financial year is expected to follow a similar trading pattern to recent years, but buoyed by onfield success including participation in the UEFA Champions League.
Scottish Football has recently endorsed proposals to restructure our domestic league system, with the aim of generating additional interest and revenue for the benefit of fans and member clubs alike. Celtic has been happy to support initiatives it sees as being in the best interests of the Club and of the Scottish game in general.
Off the field, the Club marked its 125th Anniversary in November with a celebratory event held at St Mary’s Church in Glasgow’s Calton where the inaugural meetings that led to the Club’s formation occurred in 1887. In addition, the Celtic Charity Foundation launched an associated fund raising campaign aimed at increasing donations raised for worthy causes.
In conclusion, I would wish to pay tribute to Neil Lennon and his backroom staff, all of the players and all of the Directors, management and staff at the Club who work tirelessly to maintain the standards for which Celtic is rightly renowned. And finally, I would like to thank the fans, who have continued to show their unswerving support at a particularly turbulent but exciting time in our history.