TIDMCCP
RNS Number : 0472A
Celtic PLC
20 September 2022
The information contained within this announcement is deemed to
constitute inside information as stipulated under the Market Abuse
Regulations (EU) No. 596/2014. Upon the publication of this
announcement, this inside information is now considered to be in
the public domain.
Celtic PLC
Announcement of Results for the year ended 30 June 2022
SUMMARY OF THE RESULTS
Key Operational Items
-- Winner of the SPFL cinch Premiership and qualification for
UEFA Champions League group stages in season 2022/23
-- Winner of the Premier Sports Cup for season 2021/22
-- Qualification for the group stages of the UEFA Europa League for season 2021/22
-- 31 home matches played at Celtic Park (2021: 28 games)
Key Financial Items
-- Group revenue increased by 45.2% to GBP88.2m (2021: GBP60.8m)
-- Operating expenses including labour increased by 23.4% to GBP91.7m (2021: GBP74.4m)
-- Gain on sale of player registrations of GBP29.0m (2021: GBP9.4m)
-- Acquisition of player registrations of GBP38.4m (2021: GBP13.5m)
-- Profit before taxation of GBP6.1m (2021: Loss of GBP11.5m)
-- Year-end cash net of bank borrowings of GBP30.2m (2021: GBP16.6m)
For further information contact:
Celtic plc
Ian Bankier, Celtic plc Tel: 0141 551 4235
Iain Jamieson, Celtic plc
Canaccord Genuity Limited, Nominated Adviser
Simon Bridges Tel: 0207 523 8000
CHAIRMAN'S STATEMENT
These results for the year ended 30 June 2022 show that revenue
increased to GBP88.2m (2021: GBP60.8m) with a corresponding profit
before tax of GBP6.1m (2021: GBP11.5 loss before tax). The key
driver of the revenue growth was the restoration of a more
normalised trading environment as we emerged from Covid-19 and were
able to operate at full stadium capacity for all but five matches
at the beginning of the season, where crowd restrictions remained.
This, along with record gains from player trading in the year,
GBP29.0m (2021: GBP9.4m), ensured the delivery of the reported
profit. The contribution of player trading gains, especially in
Europa League years, ensures that we maintain a healthy and
sustainable financial future. In terms of funding and liquidity, o
ur year end cash, net of bank borrowings, was GBP30.2m (2021:
GBP16.6m). The increase this year was principally due to the timing
of season ticket sales taking place later in the summer of
2021.
The Covid-19 surge over December 2021 to February 2022 was
mitigated by the SPFL's initiative to bring forward the winter
break to minimise disruption and protect vital match day ticket
income for Scottish football as a whole. As a result, our
supporters were able to attend two more matches and we did not
suffer any revenue attrition from closed door matches.
Consequently, the second half financial performance and the
reduction in earnings in this period can be attributed to trading
seasonality and the timing of player trading gains that were
weighted towards the first half of the financial year.
As reported in my interim statement, we acquired several
excellent additions to our player squad over the January transfer
window. We thus entered the second half of the financial year 6
points off the top of the Premiership leader board, but with some
confidence that we had the Manager and the squad to deliver our key
objective of regaining the SPFL cinch Premiership title. We were
delighted to win the title in May 2022 to add to the Premier Sports
Cup won in December 2021.
An extremely welcome added bonus has been that the winner of the
SPFL Premiership gained automatic qualification for the 2022/23
UEFA Champions League. This is the first time the champions of
Scotland have achieved this in 12 years, due to an increase in
Scotland's UEFA coefficient. Our Champions League draw has provided
us with a suite of exciting ties involving Real Madrid, Shakhtar
Donetsk and RB Leipzig.
The benefit of automatic qualification has delivered certainty
over the season ahead, allowing us to back our Manager and build
greater strength into the playing squad. Having signed Jota,
Cameron Carter-Vickers, Alexandro Bernabei and Benjamin Siegrist in
June 2022, we report a total investment in the player registrations
of GBP38.4m for the financial year. Post year end, we completed the
permanent signings of Sead Haksabanovic and Aaron Mooy alongside
the temporary transfers of Moritz Jenz and Oliver Abildgaard. We
continue to balance the benefits of investing in experienced
players alongside younger talent with a view to developing all
players' performances on the pitch and trading when conditions are
right. The successful execution of this model is a challenge but is
vitally important for clubs such as Celtic.
Our women's team also went on to add to the SWPL Cup win in
December 2021 by winning the Women's Scottish Cup in May 2022. This
cup double represents a remarkable achievement in such a short time
and I congratulate Fran Alonso and his team and reaffirm our
commitment to the women's game in Scotland.
The biggest influence on the financial and sporting fortunes of
the Club is our ability to participate in European competition. As
covered by Michael Nicholson in his report, the Champions League
format will change in 2024. This will provide further opportunities
and enhanced media rights. Our task is to be prepared to maximise
the opportunities that will evolve by remaining financially strong
and stable, whilst investing intelligently in the player squad, the
football department and the sporting infrastructure and
facilities.
We have every confidence in our business model that over the
period of my office has demonstrated its robustness, especially in
challenging times. In closing, I thank all of my colleagues at
Celtic, whose enormous efforts have delivered this pleasing year of
transition. I also pay tribute to our remarkable support, who have
backed the Manager and the team every step of the way.
Ian P Bankier, Chairman
20 September 2022
CHIEF EXECUTIVE'S REVIEW
Following the challenges and disappointments of the year to June
2021, but with Celtic Park finally back as it should be - full of
our supporters - everyone at the Club wanted to reward our
supporters' commitment and loyalty with entertaining and winning
football. This year ended 30 June 2022 began with our Manager, Ange
Postecoglou, taking on the existing squad and developing it, while
introducing his attacking, high intensity style of football. The
immediate priority in the 2021 summer transfer window, therefore,
was to support the Manager, and the Club committed investment in
players the Manager believed would contribute to our success.
In UEFA competitions, we prepared for our UEFA Champions League
qualifier against FC Midtjylland with a squad in transition and
lost the tie. Having overcome AZ Alkmaar, we qualified for the
group stages of the UEFA Europa League, where we faced Bayer 04
Leverkusen, Real Betis and Ferencvaros TC. This was high quality
opposition and, having finished third in the group, we qualified
for the knock out play-offs of the newly constituted UEFA Europa
Conference League, ultimately exiting the tournament to Bodo Glimt
FC.
Domestically, despite losing three of our first six cinch
Premiership matches, our supporters continued to believe in and
support what our Manager was looking to achieve. Early success in
the Premier Sports Cup fed confidence and everyone connected with
the Club was delighted to see Callum McGregor lift his first trophy
as Celtic captain. Following the last of the league defeats, in
September 2021, we embarked upon on a remarkable 32 match unbeaten
run until the end of the season; an outstanding achievement and one
that led to us regaining the cinch Premiership title.
The scale of that achievement should not be underestimated, and
we thank and congratulate the Manager, the Captain and all of the
players and staff for a fantastic season of entertaining and
winning football.
Season 2021/22 also saw us build on the success of last season
for our Women's team, with the team securing a domestic cup double
for the first time in the Club's history. This was an excellent
achievement and demonstrated real progress for Manager Fran Alonso,
Captain Kelly Clark and all of the players and staff of the Women's
team. Our strategy is to continue to develop and invest in the
Women's team and we are pleased that this commitment has been
matched by the SPFL by incorporating the women's game into the
league governing body in order to continue to develop the game in
Scotland.
Celtic FC B entered the Scottish Football Lowland League as a
guest team for the first time in season 2021/22. We finished third
in the 34-match programme in what was a highly competitive
environment. Following the success of this initiative, we were
pleased to be accepted as a guest team for season 2022/23, during
which Celtic FC B will also compete in the UEFA Youth League.
Having aligned the B Team directly under the First Team Manager,
and having appointed Stephen McManus and Darren O'Dea as our B Team
coaches, we wish them and the players the best of luck for the
season ahead. We see Celtic FC B as a vitally important development
pathway opportunity, which directly aligns with our youth
development strategy.
During the year, we continued to review and develop the
technical functions supporting our football operations, making
appointments in Recruitment, Medical, Sports Science and our
Academy, as well as investing in the Training Centre at Lennoxtown.
We are continuing to work on further infrastructure developments,
in addition to the recent stadium banners update, including the
development of a new viewing platform for our disabled supporters
and a new match day bar for season ticket holders, with a view to
improving the match day experience for our supporters. Continuous
improvement remains a key part of the Club's strategy.
We are delighted to continue to work with our sponsors,
including adidas, Dafabet and Magners, and we thank them and all of
our partners for their continued support. Our retail and multimedia
businesses continue to perform strongly and our match day
attendances, including season ticket sales, and other stadium
businesses all performed above expectations in the year. We are,
however, mindful of the current economic headwinds. We continue to
monitor the situation and factor the economic environment into key
decisions.
As we look forward into the future of European football, the
second half of the financial year saw UEFA confirm a number of
significant developments with respect to the format of the European
game and key governance matters.
Firstly, in May 2022, UEFA announced that it had approved a new
Champions League format post 2024, involving an expansion to 36
teams, a shift away from the traditional group stage format to a
single league phase and an increase to eight matches from six in
the initial phase. Similarly, under the proposals the Europa League
and Conference League would also be expanded to accommodate 36
teams, with eight matches and six matches respectively in the
initial phase. There is an expectation that, once implemented, this
would lead to increased media rights, which would in turn benefit
all participating clubs, and we would see this as a positive
development for European football as a whole.
Secondly, UEFA introduced significant enhancements in financial
governance by introducing new Financial Sustainability Regulations
to replace the previous Financial Fair Play Regulations. These are
being introduced on a phased basis from summer 2022 and have the
effect of introducing more rigorous spending controls and more
definitive sanctions in order to create a sustainable future for
the European Club environment. Celtic played a significant role at
a strategic and technical level in the development of the new
regulations, continuing to demonstrate our strategy of
participating and contributing to the future of the game at the
highest level.
As we look to the season ahead with confidence, I would like to
thank all of our colleagues for the huge part that they played in
the Club's success last season. Having started the season under
Covid-19 restrictions and facing into a number of challenges, our
colleagues helped to create the environment in which our teams
delivered that success. We will continue to work across all aspects
of the Club to build on the achievements of last season and to take
our Club forward. Finally, on behalf of everyone at Celtic, we
thank our supporters, who got behind our Manager and the team from
day one and whose contribution is crucial when it comes to our
Club's success.
Michael Nicholson, Chief Executive
20 September 2022
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the year ended 30 June 2022
2022 2021
Notes GBP000 GBP000
Revenue 2 88,235 60,781
Operating expenses (before intangible asset
transactions and exceptional items) (91,728) (74,353)
Loss from trading before intangible asset
transactions and exceptional items (3,493) (13,572)
Exceptional operating expenses 3 (6,262) (333)
Amortisation of intangible assets (13,045) (11,821)
Profit on disposal of intangible assets 29,029 9,435
Other income - 5,000
Operating profit / (loss) 6,229 (11,291)
Finance income 876 855
Finance expense (969) (1,056)
Profit / (loss) before tax 6,136 (11,492)
Tax expense 5 (287) (1,109)
--------- ---------
Profit / (loss) and total comprehensive profit
/ (loss) for the year 5,849 (12,601)
Basic profit / (loss) per Ordinary Share for
the year 6 6.19p (13.35)p
Diluted profit / (loss) per Share for the year 6 4.69p (13.35)p
CONSOLIDATED BALANCE SHEET
As at 30 June 2022
2022 2021
GBP000 GBP000
Assets
Non-current assets
Property, plant and equipment 56,265 57,939
Intangible assets 35,489 18,303
Trade receivables 13,000 11,312
104,754 87,554
======== ========
Current assets
Inventories 2,987 3,860
Trade and other receivables 38,367 23,764
Cash and cash equivalents 31,869 19,459
--------
73,223 47,083
======== ========
Total assets 177,977 134,637
======== ========
Equity
Issued share capital 27,166 27,166
Share premium 14,951 14,914
Other reserve 21,222 21,222
Accumulated profits 11,478 5,629
--------
Total equity 74,817 68,931
======== ========
Non-current liabilities
Borrowings 314 1,549
Debt element of Convertible Cumulative
Preference Shares 4,174 4,174
Trade and other payables 16,806 4,043
Lease liabilities 318 540
Provisions 114 99
Deferred tax liabilities 2,982 2,793
24,708 13,198
======== ========
Current liabilities
Trade and other payables 36,758 20,223
Lease liabilities 539 645
Borrowings 1,336 1,336
Provisions 8,350 6,213
Deferred income 31,469 24,091
--------
78,452 52,508
======== ========
Total liabilities 103,160 65,706
======== ========
Total equity and liabilities 177,977 134,637
======== ========
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year ended 30 June 2022
Share Share Other Accumulated
Group capital premium reserve profit Total
GBP000 GBP000 GBP000 GBP000 GBP000
Equity shareholders'
funds
as at 1 July 2020 27,166 14,849 21,222 18,230 81,467
Share capital issued - 65 - - 65
Reduction in debt element
of convertible cumulative
preference shares - - - - -
Loss and total comprehensive
loss
for the year - - - (12,601) (12,601)
Equity shareholders'
funds
-------- -------- -------- ------------ ---------
as at 30 June 2021 27,166 14,914 21,222 5,629 68,931
-------- -------- -------- ------------ ---------
Share capital issued - 37 - - 37
Reduction in debt element
of convertible cumulative
preference shares - - - - -
Profit and total comprehensive
profit
for the year - - - 5,849 5,849
Equity shareholders'
funds
-------- -------- -------- ------------ ---------
as at 30 June 2022 27,166 14,951 21,222 11,478 74,817
-------- -------- -------- ------------ ---------
CONSOLIDATED CASH FLOW STATEMENT
For the year ended 30 June 2022
2022 2021
GBP000 GBP000
Cash flows from operating activities Notes
Profit / (loss) for the year 5,849 (12,601)
Taxation charge 287 1,109
Depreciation 2,736 2,494
Amortisation of intangible assets 13,045 11,821
Impairment of intangible assets and other 7,235 -
prepaid costs
Reversal of prior period impairment charge (1,094) (297)
Profit on disposal of intangible assets (29,029) (9,435)
Loss on disposal of tangible fixed assets - 110
Finance income (876) (855)
Finance costs 969 1,056
--------- ---------
(878) (6,598)
Decrease / (increase) in inventories 873 (2,591)
Increase in receivables (1,856) (1,627)
Increase / (decrease) in payables and
deferred income 12,302 (698)
--------- ---------
Cash from / (used in) operations 10,441 (11,514)
Tax paid 5 - (268)
Interest received 64 34
Interest paid (77) (118)
--------- ---------
Net cash flow from / (used in) operating
activities 10,428 (11,866)
--------- ---------
Cash flows from investing activities
Purchase of property, plant and equipment (1,034) (482)
Purchase of intangible assets (20,566) (13,630)
Proceeds from sale of intangible assets 26,044 25,522
--------- ---------
Net cash from investing activities 4,444 11,410
--------- ---------
Cash flows used in financing activities
Repayment of debt (1,280) (1,280)
Payments on leasing activities (693) (739)
Dividend on Convertible Cumulative Preference
Shares (489) (472)
--------- ---------
Net cash used in financing activities (2,462) (2,491)
--------- ---------
Net increase / (decrease) in cash equivalents 12,410 (2,947)
Cash and cash equivalents at 1 July 2021 19,459 22,406
--------- ---------
Cash and cash equivalents at 30 June
2022 31,869 19,459
========= =========
NOTES TO THE FINANCIAL STATEMENTS
1. BASIS OF PREPARATION
The principal accounting policies applied in the preparation of
these Financial Statements are set out below. These policies hav e
been consistently applied to financial years 2022 and 2021,
presented, for both the Group and the Company.
Going Concern
The Group has adequate financial resources available to it,
including currently undrawn bank facilities, together with
established contracts with a number of customers and suppliers.
Additionally, the Group continues to perform a detailed
budgeting process each year which is reviewed and approved by the
Board. The Group also performs regular re-forecasts and these
projections, which include profit/loss and cash flow forecasts, are
distributed to the Board. As a consequence, the Directors believe
that the Group is well placed to manage its business risks
successfully over the medium term.
In consideration of the above, the Directors have a reasonable
expectation that the Group and Company has adequate resources to
continue in operational existence for the foreseeable future. Thus
they continue to adopt the going concern basis of accounting in
preparing the annual Financial Statements.
2. REVENUE
2022 2021
GBP000 GBP000
The Group's revenue comprised:
Football and Stadium Operations 42,782 20,825
Merchandising 24,925 22,609
Multimedia and Other Commercial Activities 20,528 17,347
--------- ---------
88,235 60,781
========= =========
3. EXCEPTIONAL OPERATING EXPENSES
The exceptional operating expenses of GBP6.3m (2021: GBP0.3m)
can be analysed as follows:
2022 2021
GBP000 GBP000
Impairment of intangible assets and other prepaid 7,235 -
costs
Reversal of prior period impairment charges (1,094) (297)
Settlement agreements on contract termination 121 630
-------- --------
6,262 333
======== ========
The impairment of intangible assets in the current year relate
to adjustments required as a result of management's assessment of
the carrying value of certain player registrations relative to
their current market value. The carrying value of intangible assets
are reviewed against criteria indicative of impairment and, where
the carrying value exceeds their current market value, impairment
is recognised. Where events subsequent to this initial assessment
give rise to a reversal of any impairments, such as a transfer or a
significant turnaround in performance, an impairment reversal is
recognised.
Settlement agreements on contract termination are costs in
relation to exiting certain employment contracts.
These events are deemed to be unusual in relation to what
management consider to be normal operating conditions as the
occurrence of these events is sufficiently irregular enough to
warrant it as exceptional.
4. DIVID ON CONVERTIBLE CUMULATIVE PREFERENCE SHARES
A 6% non-equity dividend of GBP0.53m (2021: GBP0.53m) was paid
on 31 August 2022 to those holders of Convertible Cumulative
Preference Shares on the share register at 29 July 2022. A number
of shareholders elected to participate in the Company's scrip
dividend reinvestment scheme for the financial year to 30 June
2022. Those shareholders have received new Ordinary Shares in lieu
of cash. No dividends were payable or proposed to be payable on the
Company's Ordinary Shares.
During the year, the Company reclaimed GBPnil (2021: GBPnil) in
respect of statute barred preference dividends in accordance with
the Company's Articles of Association.
5. TAX ON ORDINARY ACTIVITIES
The corporation tax receivable as at 30 June 2022 was GBP0.5m
(2021: GBP0.6m). The current year tax charge was GBP0.3m and total
tax payments in the year were nil (2021: GBP0.3m). The available
capital allowances pool is approximately GBP5.1m (2021: GBP6.2m).
These estimates are subject to the agreement of the current year's
corporation tax computations with H M Revenue and Customs.
The standard rate of corporation tax for the year in the United
Kingdom is 19% (2021: 19%).
2022 2021
GBP000 GBP000
Current tax expense
UK corporation tax 99 (609)
Adjustments in respect of prior periods - 290
-------- --------
Total current tax expense 99 (319)
======== ========
Deferred tax expense
Origination of temporary timing differences 143 827
Adjustments in respect of prior periods - (69)
Effects of changes in tax rates 45 670
-------- --------
Total deferred tax 188 1,428
-------- --------
Total tax expense 287 1,109
======== ========
6. EARNINGS / (LOSS) PER SHARE
Reconciliation of basic earnings / (loss) 2022 2021
to diluted earnings / (loss):
GBP000 GBP000
Basic earnings / (loss) 5,849 (12,601)
Non-equity share dividend 569 569
Diluted earnings / (loss) 6,418 (12,032)
========== ==========
No.'000 No.'000
Reconciliation of basic weighted average
number of ordinary shares to
diluted weighted average number of ordinary
shares:
Basic weighted average number of ordinary
shares 94,457 94,366
Dilutive effect of convertible shares 42,252 42,286
---------- ----------
Diluted weighted average number of ordinary
shares 136,709 136,652
========== ==========
Earnings per share of 6.19p (2021: loss per share of 13.35p) has
been calculated by dividing the total comprehensive profit for the
period of GBP5.8m (2021: loss of GBP12.6m) by the weighted average
number of Ordinary Shares of 94.5m (2021: 94.4m) in issue during
the year.
Diluted earnings per share of 4.69p has been calculated by
dividing the diluted earnings for the period of GBP6.4m by the
weighted average number of Ordinary Shares, Convertible Cumulative
Preference Shares and Convertible Preferred Ordinary Shares in
issue, assuming conversion at the Balance Sheet date, if dilutive.
When considering a loss per share scenario, no adjustment is made
for the preference share dividend and therefore the diluted loss
per share is equal to the basic loss per share, as was the case in
the prior year.
7. ANNUAL REPORT & FINANCIAL STATEMENTS
Copies of the Annual Report & Financial Statements together
with the Notice and Notes of the 2022 AGM will be issued to all
shareholders in due course.
The financial information set out above does not constitute the
Company's statutory financial statements for the years ended 30
June 2022 or 30 June 2021. The Independent Auditor's Reports on the
statutory financial statements for 2022 and 2021 were unqualified,
did not draw attention to any matters by way of emphasis, and did
not contain a statement under 498(2) or 498(3) of the Companies Act
2006. The statutory financial statements for 2021 have been filed
with the Registrar of Companies and those for 2022 will be
delivered to the Registrar of Companies in due course.
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END
FR EAKNEAFNAEFA
(END) Dow Jones Newswires
September 20, 2022 12:30 ET (16:30 GMT)
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