August 16, 2010 5:24 pm

Celtic dives into the red

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Celtic fans cheer their team during a match

Living in the past: Celtic’s turnover was hit by the club’s failure to qualify for the Champions League

Celtic, which sacked its manager last season after failing to win any significant trophies, on Monday warned that it continued to struggle with the impact of recession.

Turnover fell 15 per cent to £61.7m in the year to June 30, mainly because the Glasgow club participated in the Uefa Europa League, rather than the Champions League.

It also blamed lower season ticket sales, reduced merchandising revenues and a drop in domestic media income after the demise of Setanta, which had broadcasting rights for the Scottish Premier League. Year-end debt rose from £1.5m to £5.8m.

Celtic’s operating expenses fell £4.1m to £57.2m, leading to a profit from trading before asset transactions and exceptional items of £4.5m.

However, the club made a pre-tax loss of £2.1m, compared with a profit of £2m the year before, after taking account of changes in playing staff, amortisation on players, a small loss on disposal and exceptional operating expenses of £3.1m.

John Reid, chairman, said: “When considered in the context of the season that we had, and the changes that had to be made as a result of poor football results, this outcome, heavily influenced by exceptional costs, is not overly disappointing. But we must try to ensure that it is not repeated in the coming year.”

Season tickets sales were down on the record of 54,252 the year before and the board said it believed this trend would continue in the current year, notwithstanding a ticket price freeze, maintenance of concessionary schemes and new payment by instalment plans.

Mr Reid said the relatively strong financial position Celtic had insisted in maintaining in recent years had enabled it to rebuild, even after last year’s setback. “Last year we signed or took on loan 13 new players,” he said. “Already, under our new management in the new financial year, we have brought in seven new faces and will continue to seek to enhance our football squad.”

Peter Lawwell,chief executive, said: “Clearly, European progress remains key in enabling the club to achieve its financial objectives.”

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