TIDMCCP
RNS Number : 3396R
Celtic PLC
20 September 2017
Celtic PLC
Announcement of Results for the year ended 30 June 2017
SUMMARY OF THE RESULTS
Operational Highlights
-- Winner of the Scottish Domestic Treble and our sixth consecutive SPFL Premiership title
-- Qualified for the UEFA Champions League playing 6 home
European matches (2016: 6 UEFA Europa League)
-- 31 home matches (including the ICC tournament) played at Celtic Park (2016: 28)
-- Became the first stadium in the UK to accommodate 3,000 "safe standing" section
-- Achieved "Invincible" status by remaining unbeaten domestically in all competitions
-- Hugely successful Celebrate 67 events to recognise the 50th
Anniversary of the Lisbon Lions winning the European Cup in May
1967
-- Delighted to be able to provide support in assisting Celtic
FC Foundation to deliver the hugely successful SSE Hydro event,
Lions Lunch and Henrik versus Lubo charity match
Financial Highlights
-- Group revenue increased by 74.2% to GBP90.6m
-- Operating expenses increased by 33.3% to GBP76.3m
-- Gain on sale of player registrations of GBP2.3m (2016: GBP12.6m)
-- Profit before taxation of GBP6.9m (2016: GBP0.5m)
-- Year-end cash net of bank borrowings of GBP17.9m (2016: GBP3.6m)
-- Investment in football personnel of GBP13.8m (2016: GBP8.8m)
For further information contact:
Company
Ian Bankier, Celtic plc Tel: 0141 551 4235
Peter Lawwell, Celtic plc Tel: 0141 551 4235
Iain Jamieson, Celtic plc Tel: 0141 551 4235
Canaccord Genuity Limited, Nominated Adviser
Bruce Garrow Tel: 020 7523 8350
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.
CHAIRMAN'S STATEMENT
These results, which declare sales revenue of GBP90.6m (2016:
GBP52.0m) and a profit before taxation of GBP6.9m (2016: GBP0.5m),
reflect the paramount importance to the Company of participation in
the group stages of the UEFA Champions League.
The foundations for that success are based on consistency,
stability and the implementation of a prudent long term strategy
that dictates that the Company invests in its football operations,
whilst maintaining a self-sustaining financial model. The Board
considers that this strategy remains appropriate for Celtic plc and
will continue to seek out and retain top talent on and off the
field of play so as to deliver football success and, in turn,
shareholder value. The Board has been able to manage short term
challenges, and maintain the course it has set and reported on over
the past several years, because there is consistency in the
ownership, Board and executive management of the Company. These
ingredients provide the stability that is so crucial for the
successful operation of a football club at our level.
On behalf of the Board I warmly congratulate Brendan Rodgers,
his staff and the players on a truly remarkable season during which
we achieved an Invincible Treble, a sixth consecutive League
Championship and consecutive qualifications for the group stages of
the UEFA Champions League. Whilst the fundamentals that were in
place at the Club when he joined with his staff were strong,
Brendan has been a remarkable catalyst.
Just as it is important to recognise the importance to us of
participation in the UEFA Champions League, so it is important to
recognise that the financial gap between Celtic Football Club and
the richer clubs in European football is widening. The growing
financial power of a number of key constituencies within the
European game makes us vulnerable to structural change. It is,
therefore, vital that we are represented at the highest levels of
European football. Peter Lawwell's appointments to the Board of the
European Club Association, the Club Competitions Committee at UEFA
and the Professional Football Strategy Council of UEFA gives the
Club a voice and ensures that we are very well represented and that
our image and profile are held high. We are grateful for Peter's
continued commitment to promoting our interests in this very
important arena.
During the year, we welcomed Sharon Brown as a non-executive
director, bringing her financial expertise and business acumen,
notably in the retail sector, to enhance the skill set of the
Board. Ian Livingston, who was appointed in October 2007 and
chaired the Audit Committee, stepped down from the Board with
effect from 30 June 2017, in order to focus on his other public
company commitments. On behalf of the Board, I would like to thank
Ian for his contribution to the Company and wish Sharon the very
best. Sharon now chairs the Audit Committee. Taken together with
the changes to the Board last year, when Chris McKay replaced Eric
Riley as Financial Director, I believe that we have struck a good
balance between stability and progression, both of which are
crucial to the long term success of the Company.
Our football success this year marked another important moment
in the long history of our Club; the fiftieth anniversary of our
success in Lisbon, our greatest success and such an important part
of the development of our unique story. The celebrations culminated
in a fantastic week of events in May, including the Club's showcase
"Celebrate '67" event at The SSE Hydro in Glasgow, honouring the
Lisbon Lions and their amazing achievements.
Like all Celtic supporters, I was proud that all net proceeds of
those events were passed to Celtic FC Foundation to assist in its
Lions' Legacy projects and other important work. This really is
what it means to be Celtic. I thank all of our supporters,
shareholders, sponsors, partners and colleagues for their
contribution to a successful year for the Club and look forward to
working with them to build on that success for the future.
Ian P Bankier
20 September 2017
Chairman
CHIEF EXECUTIVE'S REVIEW
Following last season, when our performance on the pitch did not
meet our expectations, this year the Club could not have asked for
any more. Winning football matches is a difficult thing to do. To
remain undefeated domestically while winning all three
competitions, for only the fourth time in the Club's history, and
to do so whilst qualifying for and participating in the UEFA
Champions League group stages, is a fantastic achievement, for
which Brendan, the players and everyone at the Club should be
congratulated. Our objectives for this year remain success in all
three domestic competitions and in the UEFA Champions League.
Success on the pitch, in particular qualification for the UEFA
Champions League group stages, leads to success off the pitch and
this can be seen in our results this year. Given the restrictions
in the environment in which we operate domestically, financial
contribution from success in European football and prudent
management of player registrations is crucial to enable the Company
to continue to invest in the long term strategic objective of the
Company: to create a world class football club.
We must maintain our investment in our highly regarded football
operations, including: management, coaching, player recruitment,
medical, performance, sports science and our youth academy.
Ultimately, we hope to develop Champions League players in this
environment and Brendan's trust in our young players is testament
to their talent and the Academy's success and development over many
years. It was very encouraging to see 5 graduates of the Youth
Academy play in our victory over Kilmarnock earlier this
season.
In addition, we continue to invest at Celtic Park and at
Lennoxtown, with plans for a new hybrid pitch to complement our
style of attacking football, new training pitches being built to
improve player development and improvements being made to the
stadium and surrounding land to enhance the experience for all
supporters visiting Celtic Park. Celtic Park is iconic in world
football and we will continue to develop a venue our supporters can
be proud of.
While we cannot compete with the financial resources of some
other clubs, we can and will ensure that our investment creates the
infrastructure to grow the Club for the long term and helps us
manage the risk and uncertainty in football.
This year we celebrated the fiftieth anniversary of the Lisbon
Lions. Our triumph in Lisbon is something every Celtic supporter
will always be proud of, and in becoming the first British team to
win the European Cup, the Lions have laid down an amazing legacy
which will resonate forever with generations to come. I would like
to take this opportunity to thank all of my colleagues, our
sponsors and supporters who contributed to the Celebrate 67 events
and supported the ongoing work of Celtic FC Foundation.
I have had the real privilege of meeting every member of the
Lisbon Lions over the years, men of such stature who represented
Celtic with such grace, humility and dignity. The Lisbon Lions set
the benchmark. Everyone at Celtic strives to build on their
achievements and to bring continued success to our Club.
Peter Lawwell
20 September 2017
Chief Executive
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
2017 2016
Note GBP000 GBP000
CONTINUING OPERATIONS:
Revenue 2 90,639 52,009
Operating expenses (before intangible
asset transactions and exceptional
items) 2 (76,329) (57,249)
Profit / (loss) from trading before
intangible asset transactions and
exceptional items 14,310 (5,240)
Exceptional operating expenses 3 (1,526) (1,721)
Amortisation of intangible assets (7,546) (4,953)
Profit on disposal of intangible
assets 2,279 12,644
Operating profit 7,517 730
Finance income 204 350
Finance expense (824) (621)
Profit before tax 6,897 459
Income tax expense - -
--------- ---------
Profit and total comprehensive income
for the year 6,897 459
Basic earnings per Ordinary Share
for the year 6 7.38p 0.49p
Diluted earnings per Share for the
year 6 5.46p 0.49p
CONSOLIDATED BALANCE SHEET
2017 2016
GBP000 GBP000
Assets
Non-current assets
Property, plant and equipment 56,332 55,276
Intangible assets 13,927 9,798
Trade receivables - 3,966
70,259 69,040
======== =========
Current assets
Inventories 2,414 1,889
Trade and other receivables 12,284 14,682
Cash and cash equivalents 24,505 10,450
--------
39,203 27,021
======== =========
Total assets 109,462 96,061
======== =========
Equity
Issued share capital 27,107 24,316
Share premium 14,657 14,611
Other reserve 21,222 21,222
Capital reserve - 2,781
Accumulated losses (5,563) (12,460)
--------
Total equity 57,423 50,470
======== =========
Non-current liabilities
Interest bearing liabilities/bank loans 6,450 6,650
Debt element of Convertible Cumulative Preference
Shares 4,232 4,242
Trade and other payables 5,940 -
Provisions 1,543 1,105
Deferred income 115 1,343
--------
18,280 13,340
======== =========
Current liabilities
Trade and other payables 10,435 11,879
Current borrowings 304 304
Provisions 658 196
Deferred income 22,362 19,872
--------
33,759 32,251
======== =========
Total liabilities 52,039 45,591
======== =========
Total equity and liabilities 109,462 96,061
======== =========
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Share Share Other Capital Retained
capital premium reserve reserve earnings Total
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
Equity shareholders'
funds
as at 1 July 2015 24,294 14,573 21,222 2,781 (12,919) 49,951
Share capital issued 1 38 - - - 39
Reduction in debt
element of convertible
cumulative preference
shares following
conversion 21 - - - - 21
Profit and total
comprehensive income
for
the year - - - - 459 459
Equity shareholders'
funds
as at 30 June
2016 24,316 14,611 21,222 2,781 (12,460) 50,470
Share capital issued 1 46 - - - 47
Reduction in debt
element of convertible
cumulative preference
shares following
conversion 9 - - - - 9
Transfer from Capital
Reserve 2,781 - - (2,781) - -
Profit and total
comprehensive income
for the year - - - - 6,897 6,897
Equity shareholders'
funds
as at 30 June
2017 27,107 14,657 21,222 - (5,563) 57,423
======== ======== ======== ======== ========= ======
CONSOLIDATED CASH FLOW STATEMENT
2017 2016
GBP000 GBP000
Cash flows from operating activities
Profit for the year 6,897 459
Depreciation 1,664 1,689
Amortisation of intangible assets 7,546 4,953
Impairment of intangible assets 287 1,294
Reversal of prior period impairment
charge (64) (288)
Profit on disposal of intangible
assets (2,279) (12,644)
Loss on disposal of property,
plant and equipment 198 106
Net Finance costs 620 271
-------- ---------
14,869 (4,160)
(Increase) / decrease in inventories (525) 209
(Increase) / decrease in receivables (687) 212
Increase in payables and deferred
income 2,435 4,695
-------- ---------
Cash generated from operations 16,092 956
Net Interest paid (95) (91)
-------- ---------
Net cash flow from operating
activities 15,997 865
-------- ---------
Cash flows from investing activities
Purchase of property, plant
and equipment (2,737) (1,455)
Purchase of intangible assets (9,889) (10,933)
Proceeds from sale of intangible
assets 11,382 13,261
-------- ---------
Net cash used in investing activities (1,244) 873
-------- ---------
Cash flows from financing activities
Repayment of debt (200) (200)
Dividend on Convertible Cumulative
Preference Shares (498) (458)
-------- ---------
Net cash used in financing activities (698) (658)
-------- ---------
Net increase in cash equivalents 14,055 1,080
Cash and cash equivalents at
1 July 2016 10,450 9,370
-------- ---------
Cash and cash equivalents at
30 June 2017 24,505 10,450
======== =========
NOTES TO THE FINANCIAL STATEMENTS
1. BASIS OF PREPARATION
The financial information in this preliminary announcement has
been prepared in accordance with the recognition and measurement
requirements of International Financial Reporting Standards as
adopted for use in the EU (IFRSs) but does not include all of the
disclosures that would be required under IFRSs. The accounting
policies applied by the Group in this financial information are the
same as those applied by the Group in its financial statements for
the year ended 30 June 2016 and are those which will form the basis
of the 2017 financial statements.
2. REVENUE AND TOTAL OPERATING EXPENSES BEFORE EXCEPTIONAL ITEMS AND ASSET TRANSACTIONS
REVENUE 2017 2016
GBP000 GBP000
The Group's revenue comprised:
Football and Stadium Operations 37,571 25,149
Merchandising 16,479 12,577
Multimedia and Other Commercial
Activities 36,589 14,283
-------- --------
90,639 52,009
======== ========
TOTAL OPERATING EXPENSES 2017 2016
GBP000 GBP000
The Group's operating expenses
comprised:
Football and Stadium Operations 64,689 47,173
Merchandising 9,257 7,836
Multimedia and Other Commercial
Activities 2,383 2,134
76,329 57,143
======== ========
3. EXCEPTIONAL OPERATING EXPENSES
The exceptional operating expenses of GBP1.53m (2016: GBP1.72m)
can be analysed as follows:
Exceptional operating expenses 2017 2016
comprised GBP000 GBP000
Impairment of intangible assets 287 1,294
Reversal of prior period impairment
charges (64) (288)
Onerous employment contracts 1,004 -
Compromise payments on contract
termination 299 715
1,526 1,721
======== ========
The impairment of intangible assets, and the reversal of
impairment charges, 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.
Onerous employment contact costs result from a situation where
the committed costs under that contract are assessed as exceeding
the economic benefits expected to be received by the Group over the
term of the contract.
Settlement agreements on contract termination are costs in
relation to exiting certain employment contracts.
4. DIVIDEND ON CONVERTIBLE CUMULATIVE PREFERENCE SHARES
A 6% non-equity dividend of GBP0.51m (2016: GBP0.52m, before tax
credit deduction), was paid on 31 August 2017 to those holders of
Convertible Cumulative Preference Shares on the share register at
28 July 2017. A number of shareholders elected to participate in
the Company's scrip dividend reinvestment scheme for the financial
year to 30 June 2017. 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 GBP0.02m (2016: GBP0.02m)
in respect of statute barred preference dividends in accordance
with the Company's Articles of Association.
5. TAX ON ORDINARY ACTIVITIES
No provision for corporation tax is required in respect of the
year ended 30 June 2017. Estimated tax losses available for set-off
against future trading profits amount to approximately GBP7.64m
(2016: GBP16.08m) and, in addition, the available capital
allowances pool is approximately GBP9.52m (2016: GBP10.25m). These
estimates are subject to the agreement of the current and prior
years' corporation tax computations with H M Revenue and
Customs.
6. EARNINGS PER SHARE
2017 2016
GBP000 GBP000
Reconciliation of earnings to
basic earnings:
Net earnings attributable to equity
holders of the parent 6,897 459
Basic earnings 6,897 459
======== ========
Reconciliation of basic earnings
to diluted earnings:
Basic earnings 6,897 459
Non-equity share dividend 577 521
Reclaim of statute barred non-equity
share dividends (19) (19)
Diluted earnings 7,455 961
======== ========
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 93,403 93,120
Dilutive effect of convertible
shares 43,041 43,179
-------- --------
Diluted weighted average number
of ordinary shares 136,444 136,299
======== ========
Earnings per share of 7.38p (2016: 0.49p) has been calculated by
dividing the profit for the period of GBP6.90m (2016: GBP0.46m) by
the weighted average number of Ordinary Shares of 93.4m (2016:
93.1m) in issue during the year. Diluted earnings per share of
5.46p (2016: 0.49p) as at 30 June 2017 has been calculated by
dividing the profit for the period 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.
7. ANNUAL REPORT & ACCOUNTS
Copies of the Annual Report & Accounts together with the
Notice and Notes of the 2017 AGM will be issued to all shareholders
in due course.
The financial information set out above does not constitute the
Company's statutory accounts for the years ended 30 June 2017 or 30
June 2016. The Independent Auditors' Reports on the statutory
accounts for 2017 and 2016 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
accounts for 2016 have been filed with the Registrar of Companies
and those for 2017 will be delivered to the Registrar of Companies
in due course.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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