Celtic announce annual profits over £40m ahead of Champions League opener

Celtic have announced an annual profit of more than £40m ahead of their Champions League opener against Feyenoord on Tuesday.

The Scottish champions saw revenues increase to £119.9m for the 12 months from July 2022 to June 2023, up from the £88.2m recorded for the same period the previous year..

They made a profit of £40.7m last season, up from £6.1m the previous season, mostly because of their participation the Champions League, meaning they had £72.3m in the bank “net of bank borrowings” on June 30.

Group revenue was up by more than a third to £120m and the club reported a gain in the transfer market of £14.4m.

The figures, released on Monday, comes after winning a domestic treble in the 22/23 season that secured a place in the group stages of this season’s Champions League.

Operating expenses increased from £91.7m to £95.4m.

On announcing the figures, chairman Peter Lawwell said in a statement released on the club’s website: “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 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 June 30 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 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.”

Lawwell stated that the cash reserves were used to fund the summer transfer plans for the last two seasons, with fees “typically paid in instalments”.

The former Celtic chief executive added: “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.”

Lawwell stated that a £13m transfer spend took their total outlay to £51.4m over two years and that a further £15m had been invested since the end of June.

Celtic signed seven players on permanent deals this summer – Kwon Hyeok-kyu, Marco Tilio, Yang Hyun-jun, Odin Thiago Holm, Maik Nawrocki, Gustaf Lagerbielke and Luis Palma – and brought in Paulo Bernardo and Nat Phillips on loan.