Celtic chairman blames Mowbray over annual losses
Celtic today revealed a 15pc drop in annual turnover and an increase in bank debt of more than £4m - a financial performance partly attributed to "unacceptable results" under Tony Mowbray.
The Parkhead club posted a loss before taxation of £2.1m after making a profit of £2m the previous year.
Turnover dropped to £61.7m and net bank debt rose to £5.85m in the year up to June 30, according to the club's preliminary financial results.
Chairman John Reid claimed the team`s fortunes under previous manager Mowbray, who departed in March after a 4-0 defeat at St Mirren all but handed Rangers their second successive Clydesdale Bank Premier League title, were partly to blame for the financial downturn.
"The unacceptable results on the football pitch meant that a change in the football management team was needed," Reid told the club's official website.
"Some pride was then restored from an unbeaten run in the SPL at the end of the season, with Neil Lennon taking temporary charge.
"But that does not in any way compensate for the extreme disappointment and frustration we and all Celtic supporters felt last season.
"It was simply not good enough for this club and those who support it.
"Fortunately, the relatively strong financial position we have insisted in maintaining in recent years has enabled us to continue to rebuild even after last year's setback.
"But just as football and financial strength are essential partners in progress, so too they affect each other adversely when we are not succeeding as we should.
"Thus the combination of the financial/economic recession and disappointing football results have taken their toll in this year's report."
Reid continued: "Our turnover at £61.72m was well down on £72.59m the previous year.
"This was predominantly the effect of participation in UEFA Europa League rather than UEFA Champions League but also due to a lower level of season ticket sales, reduced merchandising revenues from one kit launch rather than two, and a drop in domestic media income following the demise of Setanta."
Reid revealed that operating expenses had fallen by more than £4m but the extensive changes in the playing staff had helped contribute to the annual deficit and the increase in the "sustainable" bank debt.
The former Home Secretary added: "This is reflective, in part, of the hefty investment made in football personnel during the year - £13.64m - significantly higher than the £8.53m of 2009."
Celtic`s wage bill decreased by more than £2m to £36.5m but that represented a greater ratio to turnover of 59.1pc.
Reid warned of further financial struggles ahead with season ticket sales expected to fall again - placing manager Lennon under increased pressure to deliver on the pitch.
He 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.
"That will not be straightforward. Some of the major factors that are likely to affect our business, such as the economic environment and consumer confidence, are not within our control.
"The economic context of Scottish football obviously also has a direct commercial impact on the club and our supporters."
Reid added: "The general picture of a constrained economic environment places a further premium on success throughout our scouting, sports science and Academy development.
"In the coming year our trading will also be put under greater pressure than has been the case for some time, and the performance of our football management team and players will be placed under even more scrutiny than normal."