TWO years ago, the management team at Celtic, the publicly quoted Scottish football club, were defensively massed in their own goalmouth attempting to stave off bankruptcy. A new financial game plan was desperately required.
On to the pitch came the corporate striker who was to provide a catalyst for a resurgence with both ball and balance sheet. Scots Canadian Fergus McCann, kitted himself out in team colours and moved into the chairman's slot. The lad did well.
McCann's sure touch in the boardroom prompted a breakout upfield with the club's money men stringing together a neat series of passes. The players in suits, having put in 110 per cent effort, eventually "got a result". When the whistle sounded this week on the past financial season, err, yea, Celtic left the pitch well pleased with their performance. Losses of £180,000 became operating profits of £2.7 million as turnover surged 54 per cent to £16 million.
But, unlike the game itself, where the final score is the ultimate arbiter, interpretation of the financial data can put a different slant on team performance. The Celtic balance sheet may have had some star performers but the opposition had that devil Bosman whose contentious transfer ruling put in a late crunching tackle on overall club finances. The ruling, which diminishes the book value of players, inflicted injury in the form of a £3.8 million writedown of assets. At the end of the day, err, year really, after tax losses rose from £400,000 to just over £1 million.
Never mind. Canny McCann believes in taking one year at a time and, like most in the football business, remains an eternal optimist. And he has good reason to be. Stadium capacity is already nearly completely pre sold for the current season, with income from downstream activities, such as merchandising, increasing dramatically. Celtic, which went public in a £9.4 million sterling share offering in January 1995, is now capitalised in excess of £121 million which, the club claims, is second only to Manchester United.
Success has benefited some 10,000 loyal supporters who put their money where their hearts lie; those who took up the initial basic £620 share package now see their investment worth £2,509. Numbered among the more prestigious punters is sharp shooting Irish entrepreneur Dermot Desmond who came on board with £4 million in exchange for 10 per cent of the equity. His share holding is now worth around a nominal £17 million. What a player!
