Announcement of Results for the year ended 30 June 2023

SUMMARY OF THE RESULTS

Key Operational Items

Winners of the Domestic Treble in season 2022/23 for a world record 8th time
Qualification for the group stages of the UEFA Champions League for season 2023/24.
Participation in the group stages of the UEFA Champions League in season 2022/23.
26 home matches played at Celtic Park (2022: 31 games).

Key Financial Items

Group revenue increased by 35.8% to £119.9m (2022: £88.2m).
Operating expenses including labour increased by 4.0% to £95.4m (2022: £91.7m).
Gain on sale of player registrations of £14.4m (2022: £29.0m).
Acquisition of player registrations of £13.0m (2022: £38.4m).
Profit before taxation of £40.7m (2022: £6.1m).
Year-end cash net of bank borrowings of £72.3m (2022: £30.2m).

CHAIRMAN’S STATEMENT

I open by welcoming back Brendan Rodgers to the Club following his successful spell as First Team Manager between May 2016 and February 2019. Following the departure of Ange Postecoglou, we assessed the market and concluded that Brendan was both the natural choice and the overwhelmingly best candidate to succeed Ange and take Celtic forward. We thank Ange for all he achieved at the Club and wish him all the best for the future and look forward to working with Brendan once again to deliver success for Celtic. My own appointment took effect from January 1^st following the retirement of Ian Bankier. I take this opportunity to reiterate the Club’s appreciation to Ian for his distinguished service in the role.

The results for the year ended 30 June 2023 show an increase in revenue to £119.9m (2022: £88.2m) with a corresponding profit before tax of £40.7m (2022: £6.1m profit before tax). This represents a record set of financial results for the Club due to a combination of factors as detailed below, including some material items of a one off nature.

The £31.7m increase in revenue reflects the participation in the UEFA Champions League in season 2022/23, when compared to the UEFA Europa League in the previous season, resulting in greater ticket and media rights income. In addition to this, our tour of Australia and a record year for our retail business were also significant contributors to the increase. The £34.6m increase in profit before tax resulted from the significant revenue increase outlined above along with a £14.4m gain on sale of player registrations, predominantly from the sales of Jota, Juranovic and Giakoumakis. In addition, we recorded £13.5m of other income that came from a combination of compensation received following the departure of Ange Postecoglou and a business interruption insurance recovery in relation to Covid-19, with the two items mentioned being one off in nature and typically non-recurring.

In terms of funding and liquidity, our year end cash, net of bank borrowings, was £72.3m (2022: £30.2m). The increase this year was principally due to the translation into cash of the strong trading environment and the typically non-recurring items mentioned previously. These reserves were used to fund the summer 2023 transfer window and will be used for settling outstanding sums due from transfers over the last two seasons, which are typically paid in instalments. This sum also contains the cash required to fund the significant investment that the Club is planning to make in developing our Barrowfield training facility. It is important to highlight that, given the increasing gap between the sums able to be earned between the Champions League and the Europa League, it is vital that we retain a cash buffer in reserve. History tells us that we will not always qualify for the Champions League and the benefit of holding cash reserves affords us the optionality of managing through seasons where we participate in the Europa League with the ability to retain our squad as opposed to selling key players to bridge the income shortfall between both competitions. The Financial sustainability rules are also a key feature of UEFA licencing and we need to be cognisant of running our club accordingly.

Building on the investment in player registrations of £38.4m in the previous financial year ended 30 June 2022, the Club made further significant investment in the year by committing an additional £13.0m, taking our total spend to £51.4m over the two financial years to 30 June 2023. Since the year end and up to 1^st September 2023 we have invested a further £15.0m into player registrations taking our total spend over this period to £66.4m. The assembly of a strong squad was a key factor in retaining the SPFL title for the second consecutive year and ultimately securing a domestic Treble. The investment will serve us well for the season ahead. Last year’s trophies brought our total Trebles to eight in our history and this landmark represented a new world record and one that all connected with our Club should be rightly proud of.

Securing the SPFL title once again in 2022/23 led to automatic Champions League qualification. Following the draw, we have been matched against Feyenoord, Lazio and Atletico Madrid in what is sure to be an exciting Champions League Group Stage. Automatic qualification allowed us to make further football investment with a focus on building greater strength into the playing squad. In the summer 2023 transfer window, we have acquired Hyeok-kyu Kwon, Marco Tilio, Hyun-jun Yang, Odin Holm, Maik Nawrocki, Gustaf Lagerbielke, Luis Palma and brought in Paulo Bernardo and Nathaniel Phillips on loan. The present squad also gives real potential for development with the average age being 24. We parted company with Aaron Mooy, Carl Starfelt, Albian Ajeti, Ismaila Soro, Osaze Urhoghide, Vasilios Barkas, Conor Hazard and Jota. We wish all our former players the best for the future.

Our successfully proven strategy has delivered stability and footballing success over many years and remains the same. We must balance the signing of players that can be developed and sold when conditions are optimal alongside the need to sign players who are able to make an immediate impact and deliver footballing success. The execution of this strategy is increasingly challenging owing to wage and transfer inflation, but this formula has underpinned both our footballing success and financial stability over a number of years now and it is vital that we adhere to it.

Following on from the League and Scottish Cup double in the prior season, our Women’s team had another strong performance in season 2022/23. Following the disappointment of losing the SWPL title by just two points to a last-minute winner on the season’s final day resulting in a second place finish, we went on to retain the Scottish Cup with a victory against Rangers Women at Hampden. Whilst finishing second in the league was a disappointment this facilitated access to the Women’s Champions League qualifiers. After defeating Brondby in the first qualifying match, our Women’s team then faced a match against Valerenga for progression to the final play-off round prior to the group stages. The match ended 2-2 after extra time and was ultimately lost in penalties. Whilst this was hugely disappointing, we take pride in the fact that this is the furthest our Women’s team have progressed in the tournament and they will take much from the experience.

As we look forward, European club competition continues to develop and further integrate. Relationships between the European Club Association (‘ECA’) along with UEFA and FIFA have never been stronger and ECA membership continues to expand. This is a positive development for European football clubs and will strengthen governance and ultimately add value to the European Football landscape. Celtic are committed to the ECA and fully endorse its objectives as we move towards the new European Club Competition format from 2024 onwards. In my role as Vice Chairman of the ECA, member of the executive committee and Board Member, I will continue to promote the interests of Celtic, Scottish football and European football as a whole.

Finally, I wish to extend my thanks to all our Celtic colleagues for their contribution to delivering another Treble and of course to all our supporters who continue to support the Club year after year in enormous numbers.

Peter T Lawwell, Chairman
September 18, 2023

Celtic plc annual results for year ended June 30, 2023