Half Yearly Report

RNS Number : 1436H

Celtic PLC

15 February 2010

 



15 February 2010

CELTIC plc

INTERIM RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2009

SUMMARY OF THE RESULTS

Operational Highlights

·    Currently second in the Clydesdale Bank Premier League.

·    Participation in the UEFA Europa League Group Stage.

·    Continued participation in the Active Nation Scottish Cup.

·    15 home matches played in the period (2008: 15).

·    Appointment of Tennent's as new shirt sponsor from July 2010.

Financial Highlights

·    Turnover decreased by 22.8% to £36.11m.

·    Operating expenses decreased by 7.9% to £31.39m.

·    Profit from operations of £4.71m (2008: £12.68m).

·    Profit before taxation of £1.27m (2008: £8.36m).

·    Period end bank debt of £3.13m (2008: £0.97m).

·    Investment in players of £7.84m (2008: £7.01m).

For further information contact:

Dr John Reid, Celtic plc	Tel: [phone]
Peter Lawwell, Celtic plc	Tel: [phone]
Iain Jamieson, Celtic plc	Tel: [phone]

Celtic plc

CHAIRMAN'S STATEMENT

A year ago I reported on a very positive set of interim results. This reflected good trading conditions, three recent Scottish Premier League Championships and participation in the Group Stage of the UEFA Champions League as Scotland's sole representative.  I said then that football and commercial success went hand-in- hand.

This year's report confirms that assertion. It certainly reflects different, more difficult trading conditions, and it is plain that like other commercial concerns we are affected by the recession.  But it also reflects disappointing performance on the park; we did not qualify for the UCL Group Stage this season as we had hoped, instead participating in the Europa League. The difference that this and the economic climate have made to our business is borne out in our financial results for the 6 months to 31 December 2009.

Turnover of £36.11m is well down (22.8%) on £46.8m at the same time last year; but while our revenues have reduced our financial performance remains highly creditable given all the circumstances.  Despite the absence of Champions League participation, over 50,000 season tickets have been sold and our merchandising business is holding up well, with this year's away kit the best selling for many years. Our sponsor programme also remains one of the most successful in British football.

Non-exceptional operating expenses have decreased by £2.71m to £31.39m, largely through labour cost savings, and we remain in profit, generating a profit from trading before asset transactions and exceptional items of £4.71m against last year's £12.68m and a profit before tax of £1.27m against £8.36m at the same time last year.

Maintaining a sustainable economic and business model has been one of our key objectives, and for good reason. It has always had only one ultimate purpose - the success of Celtic Football Club. It has provided financial stability when needed; it has delivered the continuing support of our kit manufacturer, NIKE, with whom a 5-year contract extension starts in July this year, and in an extraordinarily difficult sponsorship market, it has brought the commitment of Tennent's as our new shirt sponsor. 

This approach, together with the backing of our fans, shareholders and business partners has enabled us to continue to invest in our business, even at this time. It is a great credit to all those concerned, and on behalf of the Club, I express our thanks. I am also delighted to welcome Brian Duffy to our Board as a non-executive Director. His extensive experience in brand management, development and merchandising will be of great benefit to us.

It is our financial stability that now gives us the means to plan for the years ahead and to re-build a successful and winning team. As seen in these Interim Results it has already allowed us to have an eye to the future, as well as to the task of trying to win the Scottish Premier League title back this season. During last summer it enabled us to increase our investment in football personnel, committing just under £8m against just over £7m at the same time the year before. That has contributed to net bank debt at 31 December 2009 increasing from £0.97m to £3.13m, a level that is manageable and has therefore permitted further player trading in the January registration window.

This financial stability has also allowed us to continue to invest strategically in our facilities at Lennoxtown and the technical functions in the Academy, Scouting, Sports Science and Performance Analysis, with the objective of developing Champions League players of the future.

Perhaps above all, it is that careful management of our resources that has enabled us to progress the transition under our new manager Tony Mowbray and his team. Rebuilding is never easy. But our summer transfer activity and the significant further strengthening of the squad in January honour the pledge we made to support our manager and improve the team. Braafheid, Fortuné, Hooiveld, Kamara, Robbie Keane, Ki Sung Yueng, N'Guemo, Rasmussen, Rogne, Thomson, Zaluska and Zheng Zhi, together with several younger promising players, have joined us. Others have left - we thank them for their service to the Club, and wish them well.

We have an enormous task ahead in recovering the current league points deficit and cannot pretend otherwise, but we look forward to the SPL title challenge and a Scottish Cup run, with determination, commitment and, most importantly of all, your support.

Dr John Reid                                                                                                                                                                         12 February 2010

Chairman

Celtic plc

 INDEPENDENT REVIEW REPORT

INDEPENDENT REVIEW REPORT TO CELTIC PLC

We have been engaged by the company to review the condensed set of financial statements in the half-yearly financial report for the six months ended 31 December 2009 which comprises the Consolidated Statement of Comprehensive Income, Group Balance Sheet, Group Statement of Changes in Equity, Group Cash Flow Statement and the related notes.  We have read the other information contained in the half-yearly financial report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the condensed set of financial statements.

This report is made solely to the company in accordance with the terms of our engagement.  Our review has been undertaken so that we might state to the company those matters we are required to state to it in this report and for no other purpose.  To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company for our review work, for this report, or for the conclusions we have reached.

Directors' responsibilities

The half-yearly financial report is the responsibility of, and has been approved by, the directors.  The directors are responsible for preparing the half-yearly financial report in accordance with the AIM Rules of the London Stock Exchange.

As disclosed in note 1, the annual financial statements of the group are prepared in accordance with IFRSs as adopted by the European Union.  The condensed set of financial statements included in this half-yearly financial report has been prepared using accounting policies consistent with those to be applied in the next annual financial statements.

Our responsibility

Our responsibility is to express to the company a conclusion on the condensed set of financial statements in the half-yearly financial report based on our review.

Scope of review

We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410, "Review of Interim Financial Information Performed by the Independent Auditor of the Entity" issued by the Auditing Practices Board for use in the United Kingdom.  A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures.  A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK and Ireland) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial statements in the half-yearly financial report for the six months ended 31 December 2009 is not prepared, in all material respects, in accordance with the AIM Rules of the London Stock Exchange.

PKF (UK) LLP

Glasgow

12 February 2010

Celtic plc

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

		6 months to 31 December 2009 Unaudited	6 months to 31 December 2009 Unaudited	6months to 31 December 2009 Unaudited		6months to 31 December 2008 Unaudited		12 months to 30 June 2009 Audited
CONTINUING OPERATIONS:		Operations excluding player trading	Player trading	Total		Total		Total
	Note	£000	£000	£000		£000		£000
REVENUE	2	36,106	-	36,106		46,785		72,587
OPERATING EXPENSES	3	(31,392)	-	(31,392)		(34,103)		(61,358)
PROFIT FROM TRADING BEFORE ASSET TRANSACTIONS AND EXCEPTIONAL OPERATING EXPENSES		4,714	-	4,714		12,682		11,229
AMORTISATION OF INTANGIBLE ASSETS		-	(4,038)	(4,038)		(3,566)		(7,434)
EXCEPTIONAL OPERATING EXPENSES	3	-	-	-		(1,220)		(2,782)
PROFIT  ON DISPOSAL OF INTANGIBLE ASSETS		-	1,042	1,042		1,046		1,546
LOSS ON DISPOSAL OF PROPERTY PLANT AND EQUIPMENT		(100)	-	(100)		(121)		231
PROFIT  BEFORE FINANCIAL EXPENSES AND TAXATION		4,614	(2,996)	1,618		8,821		2,790
FINANCE COSTS: BANK LOANS AND OVERDRAFT CONVERTIBLE PREFERENCE SHARES	4			(86) (264)		(196) (264)		(243) (544)
PROFIT  BEFORE TAX				1,268		8,361		2,003
TAXATION	5			-		-		-
PROFIT FOR THE PERIOD FROM CONTINUING OPERATIONS				1,268		8,361		2,003
PROFIT AND TOTAL COMPREHENSIVE INCOME FOR THE PERIOD ATTRIBUTABLE TO THE EQUITY HOLDERS OF THE PARENT				1,268		8,361		2,003
BASIC EARNINGS PER ORDINARY SHARE	6			1.41p		9.35p		2.24p
DILUTED EARNINGS PER SHARE	6			1.13p		6.16p		1.87p

Celtic plc

GROUP BALANCE SHEET

		31 December 2009		31 December 2008		30 June 2009
		Unaudited		Unaudited		Audited
	Notes	£000		£000		£000
NON-CURRENT ASSETS
Property plant and equipment		56,160		56,006		56,689
Intangible assets	7	15,949		15,292		12,145
		72,109		71,298		68,834
CURRENT ASSETS
Inventories		2,265		2,267		2,020
Receivables		4,759		7,386		4,427
Cash and cash equivalents		8,774		11,029		10,489
		15,798		20,682		16,936
TOTAL ASSETS		87,907		91,980		85,770
EQUITY
Issued share capital	8	24,220		24,204		24,204
Share premium		14,359		14,309		14,309
Other reserve		21,222		21,222		21,222
Capital redemption reserve		2,672		2,686		2,686
Retained earnings		(17,803)		(12,713)		(19,071)
TOTAL EQUITY		44,670		49,708		43,350
LIABILITIES NON-CURRENT LIABILITIES Interest bearing loans	9	11,906		12,000		12,000
Debt element of non-equity share capital		3,027		3,027		3,027
Deferred income		157		540		254
		15,090		15,567		15,281
CURRENT LIABILITIES
Trade and other payables		14,007		15,950		14,188
Current borrowings		138		150		140
Deferred income		14,002		10,605		12,811
		28,147		26,705		27,139
TOTAL LIABILITIES		43,237		42,272		42,420
TOTAL EQUITY AND LIABILITIES		87,907		91,980		85,770

Approved by the Board on 12 February 2010

Celtic plc

GROUP STATEMENT OF CHANGES IN EQUITY

	Share capital	Share premium	Other reserve	Capital redemption reserve	Retained earnings	Total
	£000	£000	£000	£000	£000	£000
EQUITY SHAREHOLDERS' FUNDS AS AT 1 JULY 2008	24,122	14,205	21,222	2,766	(21,074)	41,241
Share capital issued	2	104	-	-	-	106
Transfer from capital redemption reserve	80	-	-	(80)	-	-
Profit and total comprehensive income for the period	-	-	-	-	8,361	8,361
EQUITY SHAREHOLDERS' FUNDS AS AT 31 DECEMBER 2008	24,204	14,309	21,222	2,686	(12,713)	49,708
Share capital issued	-	-	-	-	-	-
Transfer from capital redemption reserve	-	-	-	-	-	-
Loss and total comprehensive income for the period	-	-	-	-	(6,358)	(5,631)
EQUITY SHAREHOLDERS' FUNDS AS AT 30 JUNE 2009	24,204	14,309	21,222	2,686	(19,071)	43,350
Share capital issued	2	50	-	-	-	52
Transfer from capital redemption reserve	14	-	-	(14)	-	-
Profit and total comprehensive income for the period	-	-	-	-	1,268	1,268
EQUITY SHAREHOLDERS' FUNDS AS AT 31 DECEMBER 2009	24,220	14,359	21,222	2,672	(17,803)	44,670

 

Celtic plc

GROUP CASH FLOW STATEMENT

				6 months to 31 December 2009			6 months to 31 December 2008				12 months to 30 June 2009
	Note			Unaudited			Unaudited				Audited
				£000			£000				£000
Cash flows from operating activities
Profit before tax				1,268				8,361				2,003
Depreciation				1,052				1,045				2,204
Amortisation				4,038				3,566				7,434
Impairment of intangible assets				-				-				797
Profit on disposal of intangible assets				(1,042)				(1,046)				(1,546)
Loss / (Profit) on disposal of property, plant and equipment				100				121				(231)
Finance costs				350				460				787
(Increase) / decrease in inventories				(245)				143				390
Decrease /(increase) in receivables				23				(2,609)				(406)
Increase / (decrease) in payables and deferred income				286				(3,089)				(2,415)
Cash generated from operations				5,830				6,952				9,017
Interest paid				(86)				(196)				(243)
Net cash flow from operating activities - A				5,744				6,756				8,774
Cash flows from investing activities
Purchase of property, plant and equipment				(481)				(1,587)				(3,574)
Purchase of intangible assets				(6,962)				(4,519)				(6,970)
Proceeds from sale of property, plant and equipment				-				-				596
Proceeds from sale of intangible assets				573				2,346				3,639
Net cash used in investing activities - B				(6,870)				(3,760)				(6,309)
Cash flows from financing activities
Repayment of debt				(96)				(4)				(14)
Dividends paid				(493)				(438)				(437)
Net cash (used) / generated in financing activities - C				(589)				(442)				(451)
Net decrease / (increase)  in cash equivalents A+B+C				(1,715)				2,554				2,014
Cash and cash equivalents at 1 July				10,489				8,475				8,475
Cash and cash equivalents at period end		10		8,774				11,029				10,489

Celtic plc

NOTES TO THE FINANCIAL STATEMENTS

1.      This Interim Report, comprising the Consolidated Statement of Comprehensive Income, Group Balance Sheet, Group Statement of Changes in Equity, Group Cash Flow Statement and accompanying Notes, has been prepared in accordance with the recognition and measurement criteria of IFRS and the AIM rules save that the Group has elected not to adopt IAS34, Interim Reports.  These IFRS Interim Financial Statements do not include all the information required for full IFRS annual financial statements.

The interim results do not constitute the statutory accounts within the meaning of s434 of the Companies Act 2006.  The financial information in this report for the six months to 31 December 2009 and to 31 December 2008 has not been audited.  The comparative figures for the year ended 30 June 2009 are extracted from the Group's audited Financial Statements for that period as filed with the Registrar of Companies.  It does not constitute the financial statements for that period.  Those accounts received an unqualified audit report which did not contain any statement under sections 498 (2) or (3) of the Companies Act 2006.

         The auditors have reviewed this Interim Report and their report is set out above. 

The accounts for the interim period have been prepared in accordance with the policies which the Group will adopt for its 2010 annual accounts.

2.      REVENUE - SEGMENTAL INFORMATION

		6 months to 31 December 2009		6 months to 31 December 2008		12 months to 30 June 2009
		Unaudited £000		Unaudited £000		Audited £000
Revenue comprised:
Football and stadium operations		19,018		22,022		36,534
Multimedia & other commercial activities		7,273		13,869		17,180
Merchandising		9,815		10,894		18,873
		36,106		46,785		72,587
Number of home games		15		15		26

3.      OPERATING EXPENSES

 Total operating expenses for the period were £35.43m (2008: £38.89m). The exceptional operating expenses are £nil.  In 2008, exceptional operating costs of £1.22m reflected labour and ancillary charges largely arising as the result of onerous contracts.             

4.      FINANCE COSTS

Payable as follows on:		6 months to 31 December 2009		6 months to 31 December 2008		12 months to 30 June 2009
		Unaudited £000		Unaudited £000		Audited £000
Bank Loans and Overdraft		86		196		243
Non-Equity Shares		264		264		544
Total		350		460		787

5.      TAXATION                                                                                       

         After taking account of unutilised tax losses brought forward, together with the projected performance for the next six months, no provision for taxation is required. 

6.      EARNINGS PER SHARE

         Basic earnings per share has been calculated by dividing the earnings for the period by the weighted average number of Ordinary Shares in issue 89,811,538 (2008: 89,441,921).  Diluted earnings per share as at 31 December 2009 has been calculated by dividing the earnings for the period by the weighted average number of Ordinary Shares, Preference Shares and Convertible Preferred Ordinary Shares in issue, assuming conversion at the balance sheet date, and the full exercise of outstanding share purchase options, if dilutive.  As at December 2009, December 2008 and June 2009 no account was taken of potential conversion of share purchase options, as these potential Ordinary Shares were not considered to be dilutive under the definitions of the applicable accounting standards.

7.      INTANGIBLE ASSETS

		6 months to 31 December 2009		6 months to 31 December 2008		12 months to 30 June 2009
		Unaudited		Unaudited		Audited
Cost		£000		£000		£000
At 1 July		26,126		26,526		26,526
Additions		7,842		7,011		8,529
Disposals		(5,142)		(3,985)		(8,929)
At period end		28,826		29,552		26,126
Amortisation
At 1 July		13,981		14,664		14,664
Charge for the period		4,038		3,566		7,434
Provision for impairment		-		-		797
Disposals		(5,142)		(3,970)		(8,914)
At period end		12,877		14,260		13,981
Net Book Value at period end		15,949		15,292		12,145

8.      SHARE CAPITAL 

	Authorised 31 December				Allotted, called up and fully paid 31 December
	2009			2008		2009	2009		2008	2008
	No 000			No 000		No 000	£000		No 000	£000
Equity
Ordinary Shares of 1p each	219,933			219,878		89,883	899		89,702	897
Deferred Shares of 1p each	487,985			485,343		487,985	4,880		485,343	4,853
Non-equity
Convertible Preferred Ordinary Shares of £1 each	16,045			16,071		14,057	14,057		14,084	14,084
Convertible Cumulative Preference Shares of 60p each	19,293			19,294		16,793	10,076		16,794	10,077
Less reallocated to debt under IAS 32	-			-		-	(5,692)		-	(5,707)
	743,256			740,586		608,718	24,220		605,923	24,204

9.      NON - CURRENT LIABILITIES

Non-current liabilities reflect long-term bank loans of £11.91m (2008: £12.0m) drawn down at the end of the period as part of the Company's bank facility of £35.81m (2008: £36.00m) and £3.03m (2008: £3.03m) as a result of the reallocation of non-equity share capital from equity to debt following the introduction of IAS 32 and £0.16m (2008: £0.54m) of deferred income.

10.    ANALYSIS OF NET DEBT

The reconciliation of the movement in cash and cash equivalents per the cash flow statement to net bank debt is as follows:

		31 December 2009		31 December 2008		30 June 2009
		£000		£000		£000
Bank Loans		11,906		12,000		12,000
Cash and cash equivalents		(8,774)		(11,029)		(10,489)
Net bank debt at period end		3,132		971		1,511

Total debt, including other loans of £0.14m (2008: £0.15m) and that arising from the reallocation from equity to debt under IFRS 7 of £3.03m (2008: £3.03m) amounted to £6.30m (2008: £4.15m). 

11.    TRANSFER FEES PAYABLE / RECEIVABLE

Under the terms of certain contracts in respect of the transfer of player registrations, additional amounts will be payable/receivable by the Company if specific future conditions are met.  As at 31 December 2009 amounts in respect of such contracts could result in an amount payable of £4.14m of which £2.61m could arise within one year, and amounts receivable of £0.47m all of which could arise within one year.

12.    POST BALANCE SHEET EVENTS

Following 31 December 2009, Celtic acquired the permanent registrations of Ki Sung Yueng, Jos Hooiveld, Thomas Rogne,  Morten Rasmussen and Paul Slane and the loan registrations of Edson Braafheid, Diomansy Kamara and Robbie Keane.  The registrations of Willo Flood, Chris Killen, Scott McDonald and Barry Robson were permanently transferred to Middlesbrough, while Stephen McManus joined Middlesbrough on loan until the end of June 2010.  The registrations of Gary Caldwell and Danny Fox were also transferred on a permanent basis to Wigan Athletic and Burnley respectively.

 Directors

Dr John Reid (Chairman)*

Peter T Lawwell (Chief Executive)

Eric J Riley (Financial)

Tom E Allison *

Dermot F Desmond*

Brian Duffy*

Ian P Livingston*

Brian D H Wilson *

Secretary

Robert M Howat

Directors of the Celtic Football and Athletic

Company Limited

Peter T Lawwell

Eric J Riley

Kevin Sweeney*

John S Keane*

Michael A McDonald*

* Independent Non-Executive Director

Secretary

Robert M Howat

Football Manager

Tony Mowbray

Preference Share Dividend Timetable 2010

Ex-dividend Date:                                                           28 July 2010

Record Date:                                                                  30 July 2010

Closing date for Scrip Scheme elections:                         11 August 2010 (5.00pm)

Payment Date:                                                                31 August 2010

 

END

 

 

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