REG - Celtic PLC - Interim Results <Origin Href="QuoteRef">CCP.L</Origin>

CelticAnnouncement

12/02/2016 16:10

RNS Number : 9785O
Celtic PLC
12 February 2016
Celtic plc (the "Company")
INTERIM REPORT FOR THE SIX MONTHS TO 31 DECEMBER 2015
 
Operational Highlights 
 Currently top of the SPFL Premiership
 Continued participation in the Scottish Cup 
 17 home fixtures (2014: 18)
 Participated in Group Stages of UEFA Europa League
 Unveiling of Billy McNeil Statue
Financial Highlights
 Revenue increased by 0.3% to 31.4m (2014: 31.3m)
 Profit from trading was 1.6m (2014: 3.2m)
 Profit from transfer of player registrations (shown as profit on disposal of intangible assets) 12.6m (2014: 7.1m)
 Profit before taxation of 11.7m (2014: 6.6m)
 Period end net cash at bank of 7.7m(2014: 5.3m)
 Investment in football personnel of 6.1m(2014: 5.7m)
CHAIRMAN'S STATEMENT
I am pleased to report on our financial results for the six months ended 31 December 2015. These show a profit before taxation of 11.7m (2014: 6.6m) and period end net cash at bank of 7.7m (2014: 5.3m). The introductory page to these interim results summarises the main highlights. 
On the park, it has been a frustrating season. We are top of the Scottish Premiership and in the Sixth Round of the Scottish Cup, but we fell short in the SPFL League Cup, being knocked out in the semi final. In the European competitions, we were unable to progress beyond the group stages of the UEFA Europa League, having not qualified for the group stages of the UEFA Champions League. 
Investment in, and management of, our playing squad remains a key component of the Club's strategy and financial performance. Our profit on disposal of intangible assets of 12.6m (2014: 7.1m) largely reflects the transfer of the registration of Virgil Van Dijk to Southampton. Over the same period we re-invested in the playing squad, with 6.1m expended (2014: 5.7m) on the registrations of Scott Allan, Logan Bailly, Carlton Cole, Ryan Christie, Nadir Ciftci, Saidy Janko and Jozo Simunovic. Subsequently, during the 2016 January transfer window, further investment has been made with the signing of Danish international Erik Sviatchenko and Turkish international Colin Kazim-Richards. 
In addition to player acquisitions, we continue to fund our youth academy with the objective of developing our own first team players. The fruits of this are seen this season with the regular match appearances of Kieran Tierney, Callum McGregor and James Forrest.
The strategy of the Board is unchanged. Our overwhelming priority is to win the SPFL Premiership and to qualify for the group stages of the UEFA Champions League. Our performance in Europe this season has been the cause of considerable frustration. The challenge has been to maintain a settled and winning squad throughout the summer months when the crucial Champions League qualifying matches are played, to manage the player changes during the summer transfer window and then to kick on when the new season begins. Each season we meet this challenge within the financial constraints of where we sit in Scottish football, for to do otherwise would be reckless.
The Board considers that our self-sustaining model allows the Club to look to the future with reasonable optimism. We sit at the heart of developments in football, both at home and in Europe, being represented by Peter Lawwell on the board of the Scottish FA, the European Club Association and on the Club Competitions Committee at UEFA. Eric Riley also serves as a Director of the Scottish Professional Football League. 
Looking forward to the second half, as with previous years, trading performance in the remaining months of this financial year will not be at the same level as that in the first six months (or the comparable period in 2014), with fewer home matches scheduled, no participation in European competition and lower expected gain on player sales. 
At the end of the period, Eric Riley stepped down as Financial Director, having served the Company in this capacity for over 20 years. He has been a tremendous asset to the Club and the Board and I extend our sincere thanks to him for his unstinting support. He is replaced by Chris McKay, who joins us from Deloitte LLP where he was involved in their Financial Advisory practice for over 15 years. Eric continues to serve as a non-executive Director of the Company until 30 June 2016. 
In December we were delighted to witness the unveiling of the magnificent statue of Billy McNeill, which commands the entrance to the Celtic Way. It is a fitting monument to Billy's massive contribution to the Club as a player, a captain and a manager. It stands as an inspiration to us all as we strive to achieve our goals. I thank Ronny, his staff, the players and all of our colleagues for their hard work and dedication. I especially thank our fans, shareholders and partners for their ongoing support.
Ian P Bankier 
12 February 2016
Chairman
INDEPENDENT REVIEW REPORT TO CELTIC PLC
Introduction
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 2015 which comprises the Consolidated Statement of Comprehensive Income, the Consolidated Balance Sheet, the Consolidated Statement of Changes in Equity, the Consolidated 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.
Directors' responsibilities
The interim report, including the financial information contained therein, is the responsibility of and has been approved by the directors. The directors are responsible for preparing the interim report in accordance with the rules of the London Stock Exchange for companies trading securities on AIM which require that the half-yearly report be presented and prepared in a form consistent with that which will be adopted in the company's annual accounts having regard to the accounting standards applicable to such annual accounts.
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.
Our report has been prepared in accordance with the terms of our engagement to assist the company in meeting the requirements of the rules of the London Stock Exchange for companies trading securities on AIM and for no other purpose. No person is entitled to rely on this report unless such a person is a person entitled to rely upon this report by virtue of and for the purpose of our terms of engagement or has been expressly authorised to do so by our prior written consent. Save as above, we do not accept responsibility for this report to any other person or for any other purpose and we hereby expressly disclaim any and all such liability.
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 2015 is not prepared, in all material respects, in accordance with the rules of the London Stock Exchange for companies trading securities on AIM.
BDO LLP 
Chartered Accountants and Registered Auditors
Glasgow 
United Kingdom
Date 12 February 2016
BDO LLP is a limited liability partnership registered in England and Wales (with registered number OC305127).
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
6 months to 31 December 2015
Unaudited
6 months to 31 December 2014
Unaudited 
Operations excluding intangible asset trading
Intangible asset trading
Total
Operations excluding intangible asset trading
Intangible asset trading
Total
Note
000
000
000
000
000
000
Continuing operations:
Revenue
2
31,443
-
31,443
31,293
-
31,293
Operating expenses (excluding exceptional operating expenses)
(29,879)
-
(29,879)
(28,077)
-
(28,077)
Profit from trading before asset transactions and exceptional items
1,564
-
1,564
3,216
-
3,216
Amortisation of intangible assets
-
(2,266)
(2,266)
-
(3,449)
(3,449)
Profit on disposal of intangible assets
-
12,557
12,557
-
7,121
7,121
Operating profit
1,564
10,291
11,855
3,216
3,672
6,888
Finance income
3
151
55
Finance expense
3
(321)
(342)
Profit before tax
11,685
6,601
Income tax expense
4
-
-
Profit and total comprehensive income for the period
11,685
6,601
Profit and total comprehensive income attributable to equity holders of the parent
11,685
6,601
Basic earnings per Ordinary Share
5
12.56p
7.12p
Diluted earnings per share
5
8.76p
5.20p
Registered number SC3487
CONSOLIDATED BALANCE SHEET 
31 December
2015
31 December
2014
30 June
2015
Unaudited
Unaudited
Audited
Notes
000
000
000
NON-CURRENT ASSETS
Property plant and equipment
55,403
55,058
55,452
Intangible assets
6
10,855
8,340
8,356
66,258
63,398
63,808
CURRENT ASSETS
Inventories
1,527
1,137
2,098
Trade and other receivables
7
16,260
15,491
14,740
Cash and cash equivalents
14,688
12,433
11,770
32,475
29,061
28,608
TOTAL ASSETS
98,733
92,459
92,416
EQUITY
Issued share capital 
8
24,284
24,291
24,294
Share premium
14,611
14,574
14,573
Other reserve
21,222
21,222
21,222
Capital reserve
2,802
2,780
2,781
Retained earnings
(1,234)
(2,371)
(12,919)
TOTAL EQUITY
61,685
60,496
49,951
LIABILITIES
NON-CURRENT LIABILITIES
Interest bearing loans
6,750
6,775
6,850
Debt element of Convertible Cumulative Preference Shares
4,256
4,266
4,262
Provisions
895
977
907
Deferred income
1,400
29
2,600
9
13,301
12,047
14,619
CURRENT LIABILITIES
Trade and other payables
12,598
12,541
14,579
Current borrowings
308
375
308
Provisions
169
172
251
Deferred income
10,672
6,828
12,708
23,747
19,916
27,846
TOTAL LIABILITIES
37,048
31,963
42,465
TOTAL EQUITY AND LIABILITIES
98,733
92,459
92,416
Approved by the Board on 12 February 2016
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Share
capital
Share premium
Other reserve
Capital reserve
Retained earnings
Total
000
000
000
000
000
000
EQUITY SHAREHOLDERS' FUNDS AS AT 1 JULY 2014 (audited)
24,357
14,529
21,222
2,695
(8,972)
53,831
Share capital issued
-
45
-
-
-
45
Transfer to capital reserve
(85)
-
-
85
-
-
Reduction in debt element of
convertible cumulative
preference shares
19
-
-
-
-
19
Profit and total comprehensive income for the period
-
-
-
-
6,601
6,601
EQUITY SHAREHOLDERS' FUNDS AS AT 31 DECEMBER 2014 (Unaudited)
24,291
14,574
21,222
2,780
(2,371)
60,496
Share capital issued
1
(1)
-
-
-
-
Transfer to capital reserve
(1)
-
-
1
-
-
Reduction in debt element of
convertible cumulative
preference shares
3
-
-
-
-
3
Loss and total comprehensive loss for the period
-
-
-
-
(10,548)
(10,548)
EQUITY SHAREHOLDERS' FUNDS AS AT 30 JUNE 2015 (Audited)
24,294
14,573
21,222
2,781
(12,919)
49,951
Share capital issued
3
38
-
-
-
41
Transfer to capital reserve
(21)
-
-
21
-
-
Reduction in debt element of convertible cumulative preference shares
8
-
-
-
-
8
Profit and total comprehensive income for the period
-
-
-
-
11,685
11,685
EQUITY SHAREHOLDERS' FUNDS AS AT 31 DECEMBER 2015 (Unaudited)
24,284
14,611
21,222
2,802
(1,234)
61,685
CONSOLIDATED CASH FLOW STATEMENT 
6 months to
31 December
2015
6 months to
31 December
2014
 Note
Unaudited
Unaudited 
000
000
Cash flows from operating activities
Profit before tax
11,685
6,601
Depreciation
841
808
Amortisation
2,266
3,449
Impairment of intangible assets
-
150
Profit on disposal of intangible assets
(12,557)
(7,121)
Net finance costs
170
287
2,405
4,174
Decrease in inventories
571
560
(Increase) / decrease in receivables
(1,520)
493
(Decrease) in payables and deferred income
(3,092)
(6,583)
Cash (utilised in) / generated from operations
(1,636)
(1,356)
Net interest paid
(39)
(23)
Net cash flow from operating activities - A
(1,675)
(1,379)
Cash flows from investing activities
Purchase of property, plant and equipment
(1,639)
(2,263)
Purchase of intangible assets
(4,813)
(5,671)
Proceeds from sale of intangible assets
11,590
11,246
Net cash generated from investing activities - B
5,138
3,312
Cash flows from financing activities
Repayment of debt
(100)
(3,069)
Dividends paid
(445)
(481)
Net cash used in financing activities - C
(545)
(3,550)
Net increase /(decrease) in cash equivalents A+B+C
2,918
(1,617)
Cash and cash equivalents (including overdraft) at 1 July
9,370
14,050
Cash and cash equivalents (including overdraft) at period end
10
12,288
12,433
NOTES TO THE FINANCIAL STATEMENTS
1. BASIS OF PREPARATION
This Interim Report, comprising the Consolidated Statement of Comprehensive Income, Consolidated Balance Sheet, Consolidated Statement of Changes in Equity, Consolidated Cash Flow Statement and accompanying Notes, has been prepared in accordance with the AIM rules of the London Stock Exchange. The measurement and recognition accounting policies applied are consistent with those that will be applied in the 2016 annual financial statements which will be prepared in accordance with IFRS.
The interim results do not constitute the statutory financial statements within the meaning of s434 of the Companies Act 2006. The financial information in this Report for the six months to 31 December 2015 and to 31 December 2014 has not been audited. The comparative figures for the year ended 30 June 2015 are extracted from the Group's audited financial statements for that period as filed with the Registrar of Companies. They do not constitute the statutory financial statements within the meaning of s434 of the Companies Act 2006 for that period. Those financial statements received an unqualified audit report which did not contain any statement under sections 498 (2) or (3) of the Companies Act 2006.
The Company has considerable financial resources available to it, together with established contracts with a number of customers and suppliers. As a consequence, the Directors believe that the Company is well placed to continue managing its business risks successfully and they have a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future. Thus, they continue to adopt the going concern basis of accounting in preparing these interim financial results.
 The auditor has reviewed this Interim Report and their report is set out on page 4.
 
2. REVENUE - SEGMENTAL INFORMATION 
6 months to
31 December
2015
6 months to
31 December
2014
Revenue comprised:
Unaudited
000
Unaudited
000
Football and stadium operations
14,832
16,550
Multimedia & other commercial activities
9,154
7,973
Merchandising
7,457
6,770
31,443
31,293
Number of home games
17
18
 
3. FINANCE INCOME AND COSTS
6 months to
31 December
2015
6 months to
31 December
2014
Finance income:
Unaudited
000
Unaudited
000
Interest receivable on bank deposits
21
55
Notional interest income on deferred consideration
130
-
151
55
Finance costs:
Interest payable on bank and other loans
(60)
(78)
Dividend on Convertible Cumulative Preference Shares
(261)
(264)
(321)
(342)
4. 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. 
5. EARNINGS PER SHARE 
 
 Basic earnings per share has been calculated by dividing the profit for the period of 11.69m (2014: 6.60m) by the weighted average number of Ordinary Shares in issue 93,032,839 (2014: 92,723,831). Diluted earnings per share as at 31 December 2015 has been calculated by dividing the profit 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 if dilutive, in accordance with IAS33 'Earnings Per Share'. 
6. INTANGIBLE ASSETS 
6 months to
31 December 2015
6 months to
31 December 2014
12 months
to 30 June
2015
Unaudited
Unaudited 
Audited
Cost
000
000
000
At 1 July 
30,200
27,475
27,475
Additions
6,067
5,702
9,421
Disposals
(8,742)
(2,159)
(6,696)
At period end
27,525
31,018
30,200
Amortisation
At 1 July 
21,844
20,278
20,278
Charge for the period
2,266
3,449
7,313
Provision for impairment
-
150
378
Reversal of prior period impairment
-
-
(639)
Disposals
(7,440)
(1,199)
(5,486)
At period end
16,670
22,678
21,844
Net Book Value at period end
10,855
8,340
8,356
7.  TRADE AND OTHER RECEIVABLES
 The increase of 0.8m in the level of receivables from 31 December 2014 to 16.3m is primarily a result of an increase in amounts due from player sales.
8. SHARE CAPITAL 
Authorised
 31 December 30 June
 Allotted, called up and fully paid
 31 December 30 June
2015
2014
 2015
2015
2015
2014
2014
2015
2015
No 000
No 000
No 000
No 000
000
No 000
000
No 000
000
Equity
Ordinary Shares of 1p each
222,666
221,914
221,927
93,135
932
92,818
928
92,831
928
Deferred Shares of 1p each
624,816
611,787
612,541
624,816
6,248
611,787
6,118
612,541
6,125
Non-equity
Convertible Preferred Ordinary Shares of 1 each
15,062
15,171
15,171
13,075
13,075
13,184
13,184
13,184
13,184
Convertible Cumulative Preference Shares of 60p each
18,605
 18,645
18,632
16,105
9,663
16,145
9,686
16,132 
9,679
Less reallocated to debt under IAS 32:
Initial debt
Capital reserve
-
-
-
-
-
-
-
-
(2,834)
(2,800)
- 
- 
(2,845)
(2,780)
- 
- 
(2,841) 
(2,781)
 
881,149
867,517
868,271
747,131
24,284
733,934
24,291
734,688
24,294
9. NON - CURRENT LIABILITIES
Non-current liabilities reflect the non-current element of bank loans of 6.8m (December 2014: 6.8m, June 2015: 6.9m) drawn down at the end of the period as part of the Company's bank facility of 19.4m (December 2014: 20.3m, June 2015: 19.6m) and 4.3m (December 2014: 4.3m, June 2015: 4.3m) as a result of the reallocation of non-equity share capital from equity to debt following the introduction of IAS 32, 1.4m (December 2014: 0.03m, June 2015: 2.6m) of deferred income and provisions of 0.9m (December 2014: 1.0m, June 2015: 0.9m).
10. ANALYSIS OF NET CASH AT BANK
The reconciliation of the movement in cash and cash equivalents per the cash flow statement to net cash is as follows: 
31 December
2015
31 December
2014
30 June
2015
000
000
000
Bank Loans due after more than one year
(6,750)
(6,775)
(6,850)
Bank Loans due within one year
(200)
(375)
(200)
Cash and cash equivalents:
 Cash at bank
14,688
12,433
11,770
Net cash at bank at period end
7,738
5,283
4,720
Total net cash, deducting other loans of 0.1m (December 2014: 0.1m, June 2015: 0.1m) and that arising from the reclassification of equity to debt following the adoption of IAS32 of 4.3m (December 2014: 4.3m, June 2015: 4.3m) amounted to 3.3m (December 2014: 0.9m, June 2015: 0.3m). 
 
Included in the cash balance of 14.69m is 2.40m (December 2014: nil, June 2015 2.40m) which is on deposit with a maturity date of greater than 3 months at the balance sheet date. The cash and cash equivalents balance for the purposes of the cash flow statement under IAS 7 is therefore 12.29m (December 2014: 12.43m, June 2015: 9.37m).
11.  POST BALANCE SHEET EVENTS
Since the balance sheet date, we have completed the permanent signings of Erik Sviatchenko from FC Midtjylland and Colin Kazim-Richards from Feyenoord. We have also completed the loan signing of Patrick Roberts from Manchester City while Anthony Stokes, Nadir Ciftci, Jamie Lindsay and Aidan Nesbitt have had their registrations loaned to other clubs.

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