Celtic money in bank more than any other club’s turnover

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Celtic’s interim accounts for the six months to 31 December 2018 were published yesterday.  Income was down £21m on the corresponding period last season, to £50.015m, largely as a consequence of not qualifying for the Champions League group stage.

There was a corresponding fall in operating expenses, down £4m to £43.823m, as Champions League bonuses were not earned.  The relationship between operating expenses and income is important for any business.  For the period, Celtic were able to pay current level of wages and still produce a £6m operating surplus.  This figure will be negative for the second half of the season, but operating expenses and income will not be hugely misaligned by the end of the season.

This six-month turnover of £50m is just £2m shy of the 12 month figure the last time we failed to reach the Champions League group stage, in season 2015-16.  While Champions League revenue remains hugely important to the club, the reality is that increased revenue from season ticket sales, and significant increases in merchandising, commercial and multimedia activities, allows Celtic to carry its significantly higher wage bill without jeopardising the club.

The final six months of last season, which saw one Europa League tie and a run to the Scottish Cup Final, contributed £30m revenue.  A comparable trading period this season will see annual revenue reach £80m.

For some perspective, that is higher than revenue in any Champions League season before Brendan Rodgers’ arrival, and only £10m short of the £90m revenue in Brendan’s first treble winning season.  Without Champions League income, this figure would be a fantasy as recently as 18 months ago.  There has been a transformational change in the robustness of the Celtic business model in that period.

The Dembele transfer to Lyon pushed the player sales revenue to £17.563m, all of which dropped to operating profit, which was £18.968m.  Profit after tax was £15.233m and money in the bank (net of any loans etc.) was a very healthy £37.7m.

Since I started financial analysis on CQN in 2004 I said that Celtic spend all monies received over any business cycle you care to mention – usually taken to task on this point in seasons of surplus, then forgotten about in seasons of loss, but it has always held true.  Always.

What does this mean for a club with £37.7m in the bank, which can increase its annual revenue by 30% with Champions League qualification?  It means we have the money to buy central defenders and a right back in the summer, while maintaining current wage levels and not selling key players.  This does not guarantee we will get the right players in, or that any of them will earn a Champions League bonus.  These are the challenges.

Challenges they may be, but such problems are the fantasies of every pretender to our domination of Scottish football.  Celtic have more money in the bank than any other surviving football club have turned over in a year in their history (by £5m).  If others try to keep up with Celtic they will reach a familiar end.  This is the established normal and it is not going to change.

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  1. I can’t remember who, someone on the blog said, wait and see Sevco will get Sat cup tie and we will get Sunday.

     

     

    It looks as if that was the plan, but Police Scotland are vetoing Sheep v Sevco at Sat teatime.

     

     

    Premier sports are now asking to reverse the fixtures which would mean we would be in Edinburgh on the Sat 5.15 slot.

     

     

    Hail Hail

  2. ” Since I started financial analysis on CQN in 2004 I said that Celtic spend all monies received over any business cycle you care to mention – usually taken to task on this point in seasons of surplus, then forgotten about in seasons of loss, but it has always held true. Always. ”

     

    Seems fair to me, Paul but I am sure it will be challenged. With or without supporting evidence :-)

     

     

    JJ

  3. THE EXILED TIM

     

     

    Yes, i understand your stance and admire it but i think you’ve

     

    got to appreciate other peoples point of view.

     

    Was he good enough? who knows but i thought so, but then

     

    again when i first saw Paul Elliot’s first game in a pre season in

     

    Germany i said to my son ” he looks like Bambi on ice ” which

     

    i am frequently reminded of.

     

    It’s all about opinions.

     

    Anyway i preferred your posts and pics of your swimming pool

     

    lol.

     

    H.H Mick

  4. Emmm, is it just me or does anyone else it a wee bit odd that a company announcing a drop of income of £21 mill in their interim accounts would deem it prudent to award the CEO of the company (announcing such a decline in income) an watering bonus (allegedly £2.3 million) the previous month prior to informing all it’s minor shareholder ( IE -me & you) that revenue is down by a such huge amount?

  5. Mick

     

    I know it sounds harsh, but if I held another point of view I wouldn’t hold my own, I understand that others have a point of view, but they are the same as I am holding their’s, each other’s point in reality is irrelevant :-)

     

    Opinions about players, this I believe is the reason so many clubs employ directors of football so they don’t have a massive clear out when they change their coach.

     

    Thankfully our club has gone down this route ;-)

     

    HH

     

    Shopping beckons, laters.

  6. Paul 67,

     

     

    Operating profit £6. I assume this fee contributed to our results along with the Moussa fee.

     

     

    If so, without these two transfers we operated at a loss. Hmmmmmmmmm

  7. So income down £21M, but costs also down £4M for similar reasons.

     

     

    This allows us two answer two questions oft quoted on here.

     

     

    1. How much did the transfer window balls

     

    up in the summer cost the club.

     

    2. Why, at a time of unprecedented success (but unique domestic dominance), are so many fans critical of certain aspects of the club’s running.

     

     

    There’s 17 million reasons right there for you.

     

     

    HH jg

  8. Gents,

     

     

    Apologies wi-fi kicking in and out.

     

     

    Operating profit £6m . I assume this fee contributed to our results along with the Moussa fee.

     

     

    If so, without these two transfers we operated at a loss.

  9. I’m glad we didnt qualify for the Champions league. We hadn’t invested in the squad in the summer and I doubt the jan window would have been any different. I’m looking forward to tomorrow nights game and think we’re in with a good chance. Our domestic form is outstanding and who knows what confidence sapping defeats in the CL would do.

  10. good results, but it just shows you that the non qualification for CL and the subsequent sale of top assets as a result are linked. Not to break even, no, but to ensure a profit and healthy dividend/bonus for those that have control in such matters.

  11. Oglach

     

     

    I think the massive bonus for the CEO was for the earlier period and I believe covered 2 years. The reason the bonus was so massive was that the KPI were much higher than forecast and accordingly these figures produced a higher figure than expected.

     

     

    I would think that the bonus next time will be much smaller given the lower figures. Here’s hoping that another treble would be achieved.

     

     

    One of the factors in favour of bonuses is that when we win trophies then we end up paying more in bonuses, which is OK with me. The same is true if we produce record commercial revenues then the staff get bonus higher than normal.

     

     

    Given all that the figures are IMO far too high

  12. Paul67

     

     

    Ah but, ‘they’ didn’t spend it last summer.

     

     

    The cynics are already telling us we won’t spend it next year either, despite signing 8 players in the January window ‘when players are NOT available’

     

     

    Give me joy CSC

  13. TET

     

     

    Just catching up.

     

     

    You said McGiin must be telling the truth as he told his story on tv.

     

     

    I watched Gary McAllister, huns assistant manger, say on tv that Morelos was trying to get out the way of the Aberdeen player when he accidentally raked his balls.

     

     

    I’m not saying McGinn is a liar btw!

     

     

    :-)

  14. bigbhoy on 13th February 2019 1:17 pm

     

     

    ====

     

    Not really wishing to get into PL bashing mode. However the bonus award given the interim financial results doesn’t look good. Other companies shareholders have blocked such bonus payments and I believe that if we had the opportunity to do so we should have in this instance. However sadly given that the minor shareholders will never have a say in the running of the club due to vested interests of individuals holding the majority of shares the PLC will continue to award huge bonus payments for failure, £21mill loss in revenue for a medium sized company would see most CEO’s sacked. Not Teflon Pete though.

  15. What is the Stars on

    With all this surplus cash isnt it about time we rewarded Peter Lawwell with an increase in both salary and bonus.

     

     

    The man is worth his weight in gold,

  16. I’m am glad this season we haven’t been involved in PSG type drubbings.

     

     

    Man Utd, even by their standards were made to look 2nd rate last night.

  17. oglach

     

     

    I think that the bonus period covered was passed but the payment date was deferred to 31st December 2018

  18. MELBOURNE MICK on 13TH FEBRUARY 2019 12:40 PM

     

     

    THE EXILED TIM Yes, i understand your stance and admire it but i think you’ve got to appreciate other peoples point of view. Was he good enough? who knows but i thought so, but then again when i first saw Paul Elliot’s first game in a pre season in Germany i said to my son ” he looks like Bambi on ice ” which i am frequently reminded of.

     

     

    *A bankie on the Big Lhist after a certain wee Swedish winger we signed fae a dikeplugger club’s debut called him a tottie.

  19. Tell your grannies to wear shin pads next twice that Rangers are playing. McGregor may be walking down a High Street near you.

  20. I love it that we can have reasonably informed exchanges about our clubs finances.

     

     

    There is a decent amount of transparency about what is happening to our contribution to the wellbeing of an entity which we all care about.

     

     

    It’s not perfect and never will suit everyone of course. Folk choosing to ignore that we need to raise transfer revenue as part of the business model etc. Folk not seeing value in CEO LTIP etc.

     

     

    At least we are having these debates and throwing our hard earned cash at an opaque financial basket case run by a criminal. No accountability and zero transparency …. but hey Barnum doing his bit to milk those bears.

     

     

    These are great times to support Celtic despite the global structural challenges football faces. Few are better run and few outside of the land of milk and honey are making money. The fundamentals of our club are in good shape. Although, unlike many, I don’t believe 9 and 10 will be easier than this year I think they will be even sweeter for that. Great Celtic Times our forefathers could have only dreamt of. .

  21. BURNLEY78

     

    “Great Celtic Times our forefathers could have only dreamt of”

     

     

    and our foremothers! por ceirto :))

  22. we had money in the bank last summer and didn’t invest when it was crucial to help us qualify for the champions league.

     

    why do you think we will invest this summer in almost identical circumstances?

     

    don’t hold your breath

  23. bankiebhoy1 @ 1:29

     

     

    You could do worse than Houston’s in Paisley (see https://www.kiltmakers.com/).

     

     

    They’re on the High Street, across from the town’s main library, close to the entrance to Paisley Uni (or ‘Uni of The West of Scotland’, if you prefer) …

     

     

    VIP

  24. Go tell the Spartim on

    I think like some if not many on here, the assertion that with the money in the bank we will see it used on rebuilding the defence, im a bit sceptical, we’ve seen how this pans out every transfer window, as ever i wont believe it until i see them wearing a celtic top on the centre circle

  25. Bankiebhoy

     

     

    i used Slanj kilts for mine, Bath St in Glasgow(may have an Edinburgh gaff too)

     

     

    they are a bit younger in their outlook with daft t-shirts etc but do all the traditional stuff you need. Not as stuffy as some shops.

     

     

    PS when i was in to be fitted , the young fella sorting me mentioned his boss had been in a band called H2O back in my youth. I started singing ‘I dream to sleep, i sleep to dream’ and the boss stuck his head out of a changing room , dead chuffed someone remembered the song(i have it on a 45)

  26. Alasdair MacLean on

    Looked into Hunmedia for some light entertainment after McGregor’ s ban….

     

     

    “Personally think it’s an arguable red but Power and the St Mirren boy getting off for far worse is a disgrace

     

     

    Hopefully he retires from international football.”

     

     

    He can retire from his lifetime ban. Gee whiz, how did we get here?

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