Celtic chief executive Peter Lawwell claims a policy of 'smarter spending' lies behind the Parkhead club's financial rejuvenation.
The Bank of Scotland Premier League champions posted a profit before taxation of £17.94million for the final half of 2006.
The interim results compare to a loss of £960,000 to 31 December 2005.
When the Hoops reached the final of the UEFA Cup in 2003, they still managed to lose almost £8million.
However, a restructuring of the club by Lawwell, which included introducing incentive-based contracts and accepting lucrative pre-season friendlies abroad, in addition to a successful Champions League campaign this season, has, according to Lawwell, put Celtic on 'solid foundations'.
He told PA Sport: 'Over a number of years, we made significant losses but now we have a solid foundation.
'In the year that we got to Seville, we lost £7.8million and the turnaround since then has been for various reasons but mainly increasing the income and controlling the costs.
'The European run this season has played its part but you also have to include others things, such as the pre-season tours and transfers.
'But, during that time, we have still managed to recruit big name players such as Shunsuke Nakamura, Jan Vennegoor of Hesselink and Thomas Gravesen.
'We will always have three or four of big-name players at the club because the Celtic fans demand it.
'But we are spending more smartly.
'And incentives, in terms of players being paid for appearances, is in a a bigger percentage of contracts than previously.
'We have spent £13million on players over the two periods [second half of 2005 and 2006].
'We will continue to support Gordon in his ambitions and we are well-placed to do so.'
Lawwell acknowledged the importance of Celtic's Champions League run this season to the club's encouraging financial upswing.
The Parkhead side failed to qualify for the group stages last year after losing in the second qualifying round to Artmedia Bratislava.
However, manager Gordon Strachan has guided the Hoops to the knockout phase for the first time, where they will take on AC Milan in the last-16 first leg at Celtic Park next week.
Celtic chairman Brian Quinn noted how vital European football had been to the Parkhead club this term, a view reiterated by his chief executive.
Lawwell said: 'To get the sort of figures that we see in this interim report, then a European run is important.
'But the foundations of the club are such that it is not necessary.
'We don't plan for European runs, let me put it like that.'