SBS & L accounts (10 Viewers)

[oldskyblue58]

Having looked at the 2012 accounts filed 29/10/13 these are the main points. Will try keep it factual

- Directors report focusses on cost savings and need to own a stadium. It also discloses that ARVO have put in £9.181m since 31/05/12 by way of additional loans and secured on assets of the group. It states Otium now own and run the club, and that CCFC Ltd now in liquidation. Club existence dependent on financial support from ARVO and SISU.Signed by the two directors Fisher & Labovitch

- Audit Report. Not qualified but usual emphasis of matter. Club has prepared budgets to at least Oct 2014. ARVO/SISU have provided written confirmation of continued funding but it is not a guarantee. No intention to call in loans but it is not a guarantee. Budgets based on assumptions around ground share dependent on attendances etc and might not be achievable. Continued program of cost saving

Profit & Loss Account
- Turnover specific to CCFC down from 12.1m to 10.8m. Ticket sales was 3.5m (2011 3.9m) Commercial income 7.3m (2011 8.2m)
- staff costs were down from £11.2 to 9.9m in 2012. There were a total of 490 employees (83 player/management 45 admin 362 stewards) 2011 was 610 in total
- directors remuneration was 136k in 2012 and 27k in 2011. In addition 361k was paid to third parties for directors services (2011 206k). Ranson was not a director during the 2012 financial year end.
- admin expenses (other day to day costs)were 5.3m compared to 13.3m in 2011.
- lease costs relating to land are 1.7m 2011 1.6m
- Interest paid was 1.2m compared to 1.0m in 2011. I am assuming that this is paid in the main to ARVO
- player cost amortisation was 1.6m compared to 1.8m in 2011
- on the other side during 2012 the group made 2.8m profit on player sales compared to 72k in 2011
- there was also a 1.4m profit on disposal of Prozone

overall the Group made a 4m loss compared to a 16m loss in 2011. The year 2011 included a write down of goodwill 6.4m plus annual write down of goodwill 1.4m that distorts the figures. Plus the 2011 day to day costs seem very high. However due to the sale of players and Prozone the club shows a lower loss situation in 2012.

Balance Sheet
- the balance sheet now has 38m more liabilities than assets (2011 34m). The club has total assets of £5m but liabilities of £43m
- Going concern note by directors states directors have reasonable expectation of achieving cost savings and budgeted income levels
- there is no liability to corporation tax and £60m in losses to carry forward.
-Player additions in year to 31/05/12 cost £994k. Squad value on Balance sheet 310512 was £ 948k. Ryton was valued at £785k
- SBS&L owns 90.1 % of the shares in Otium, and therefore CCFCH and CCFC Ltd
- At 31/05/12 there was still £315k in the Escrow account
- Other loans due within one year have increased from £6.3m to £7.6m including 6.275m due ARVO with £219k interest to be added at 310512
- other loans due over 1 year are 30.3m down from 31.7m in 2011. Included in that is £28.5 due to SISU down from £29.7m in 2011. It also includes 1.75m due to ARVO (2011 was £2m). ARVO loans can be converted to shares in 2014
- There are potential transfer liabilities of £240k (£290k 2011)
- There is potential income due £1.38m based on transfer appearance agreements from other clubs. £755k has been received since 310512
- Potential liability for player appearance bonuses etc are £2.2m down from £2.6m in 2011
- since year end ARVO have made a £5.986m revolving loan to the group that can be converted to 12.5% of the issued shares. Due to be repaid December 2013
-there was also a further loan from ARVO of £3.195m since the year end
- Prozone was sold for £4.67m and showed a profit on disposal of £1.4m

Thats the bare bones of the Group accounts to 31/05/12

One question I have is that the loans from SISU total £28.5m at 31/05/12. In my opinion we know that includes £6m of creditors that were not paid because we were not in Premiership by 2013 and £1m for the option on the Higgs share that should not have had a value. So that nets down to £22m. Plus the amounts due to ARVO £8.025m at 31/05/12 plus amounts since £5.986m and £3.195m. How does that equate to £60m having been invested? indeed if it has been what was the additional £21m spent on?

 

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[ozz]

The worrying thing is the only way the club is going to get their hands on any new money is the players! That means...January transfer window, which might be to tempting for the city board to turn down!!!

 

[The Prefect]

One question I have is that the loans from SISU total £28.5m at 31/05/12. In my opinion we know that includes £6m of creditors that were not paid because we were not in Premiership by 2013 and £1m for the option on the Higgs share that should not have had a value. So that nets down to £22m. Plus the amounts due to ARVO £8.025m at 31/05/12 plus amounts since £5.986m and £3.195m. How does that equate to £60m having been invested? indeed if it has been what was the additional £21m spent on?

Many thanks for the summary. I think part of the reason for negotiations over the arena are that the club are falling significantly short of their turnover target this year and losses are mounting much faster than anticipated.

As for the where the £21m went I seem to remember that £30m of the debt was purchased at about 30p in the £1. On that basis a £30m debt cost SISU about £8.9m.

Looking at the total debts is a bit misleading as they may not evidence actual 'investment'.

 

[oldskyblue58]

Think the point I am making is that it is claimed that it has cost JS £60m to date. The only way to look at that "investment" is to look at the Group situation because it excludes monies that are lent between group companies.

To 31/05/12 the external monies put into the group by SISU funds and ARVO were 28.5m and 8.025m respectively per the accounts. That includes the discounted amounts SISU took on in 2008. The issue I have with that is that there was £6m of those discounted debts which related to a liability to pay creditors on promotion to the premiership by 2013- that was written off in the 2011 accounts so never paid out. Also included in the investment is £1m that paid 2008 for the option to purchase the Higgs option from CCFC Ltd not sure that was ever actually paid there is nothing in the CCFC Ltd or Charity accounts to say it was.

Therefore at 31/05/12 the actual cash put into the Group by 31/05/12 was around £30m (SISU £22m plus ARVO £8m). Since then ARVO have put in £9.1m by way of further loans making a total of £39m cash. To get to £60m as claimed that means a further £21m from somewhere. According to Mr Appleton first report there were £3m in losses for period to 22/03/13 so say all those losses needed to be financed (unlikely) then that leaves a difference of £18m that SISU claim to have spent to get to a total of £60m (loans, funding, investment call it what you will)

Basically it does not add up to what we have been told

 

[shmmeee]

What's the interest rate we're paying to ARVO?

Is there any interest on the SISU Capital loans?

Also, I thought Timmy was on payment by results, how the hell did he earn £136k?

Question: When do these accounts go up to? Would it include anything since we moved to Sixfields or any of the 19 players that left pre-season?

What I'm saying is, if we were to guess now, would it be fair to assume player wages and staff costs (ballboys, stewards, etc) would be well below that stated?

 

[oldskyblue58]

What's the interest rate we're paying to ARVO?

Is there any interest on the SISU Capital loans? nothing to suggest there is. Interesting that the actual amount owed in 2012 is less than in 2011

Also, I thought Timmy was on payment by results, how the hell did he earn £136k?. It isnt unreasonable for him to be paid though I think it is his bonus that is performance related. Also who does the third party payments relate to?

Question: When do these accounts go up to? Would it include anything since we moved to Sixfields or any of the 19 players that left pre-season? the accounts go up to 31/05/12 they may if relevant include stuff that happened since in the notes eg the £755k received in transfer fees since disclosed in note 27. The directors & Auditors have to consider a period to at least 29/10/14 to decide if a going concern, that will include Sixfields but there are no details as such

What I'm saying is, if we were to guess now, would it be fair to assume player wages and staff costs (ballboys, stewards, etc) would be well below that stated? certainly the wage costs would be a lot lower

hope that helps

 

[shmmeee]

hope that helps

A lot thanks.

So why the switch to ARVO as our "bank"? Paying £1.2m/year in interest on a £9m (is that right, the other loans came since?) seems a lot (13%), even £1.2m on £16m is a fair whack (7.75%).

As a side note, I expect everyone saying the council was "bleeding the club dry" to be up in arms about the exact same amount going to our owners.

 

[James Smith]

Having looked at the 2012 accounts filed 29/10/13 these are the main points. Will try keep it factual

[balance sheet technical info]

Thats the bare bones of the Group accounts to 31/05/12

One question I have is that the loans from SISU total £28.5m at 31/05/12. In my opinion we know that includes £6m of creditors that were not paid because we were not in Premiership by 2013 and £1m for the option on the Higgs share that should not have had a value. So that nets down to £22m. Plus the amounts due to ARVO £8.025m at 31/05/12 plus amounts since £5.986m and £3.195m. How does that equate to £60m having been invested? indeed if it has been what was the additional £21m spent on?

I think I understood most of that, thanks for demystifying for us.

 

[chiefdave]

One question I have is that the loans from SISU total £28.5m at 31/05/12. In my opinion we know that includes £6m of creditors that were not paid because we were not in Premiership by 2013 and £1m for the option on the Higgs share that should not have had a value. So that nets down to £22m. Plus the amounts due to ARVO £8.025m at 31/05/12 plus amounts since £5.986m and £3.195m. How does that equate to £60m having been invested? indeed if it has been what was the additional £21m spent on?

I would love to see SISU do something similar to Everton and post a clear explanation of where the money has gone. Of the £39m showing as put in by SISU is there anything to indicate how much of that is in payments to themselves (i.e.: salaries to their own people, management fees, interest etc).

I still can't see anyway other than getting the Ricoh for nothing that SISU will ever be able to get this money back.

 

[shmmeee]

I would love to see SISU do something similar to Everton and post a clear explanation of where the money has gone. Of the £39m showing as put in by SISU is there anything to indicate how much of that is in payments to themselves (i.e.: salaries to their own people, management fees, interest etc).

I still can't see anyway other than getting the Ricoh for nothing that SISU will ever be able to get this money back.

Well whatever they get it for, they'll need to make a £40m profit for doing nothing, so however you look at it, the taxpayer gets screwed.

 

[oldskyblue58]

A lot thanks.

So why the switch to ARVO as our "bank"? Paying £1.2m/year in interest on a £9m (is that right, the other loans came since?) seems a lot (13%), even £1.2m on £16m is a fair whack (7.75%).

As a side note, I expect everyone saying the council was "bleeding the club dry" to be up in arms about the exact same amount going to our owners.

Would guess they ran out of the ability to take more money from the private equity funds. Otium accounts alone showed £200k on the 2m loan they had from Otium alone - not sure if that was for a year or not. I would have expected the interest rate to be disclosed on a related party transaction but it hasnt been

 

[oldskyblue58]

I would love to see SISU do something similar to Everton and post a clear explanation of where the money has gone. Of the £39m showing as put in by SISU is there anything to indicate how much of that is in payments to themselves (i.e.: salaries to their own people, management fees, interest etc).

I still can't see anyway other than getting the Ricoh for nothing that SISU will ever be able to get this money back.

I tried to list any info that might be in the accounts regarding SISU, directors etc..... not much more I think I can add.

I am inclined to agree about getting money back but if you look at ACL accounts then breakeven is around 6m before any cost savings were made on loans etc. Since then the turnover increased to 12.4m , overheads wont have gone up much so only need to deduct variable costs from it say 50% that leaves profits at 3.2m pa which could help...... also buy cheap sell high and they could get a big chunk of it back tax free

 

[chiefdave]

Well whatever they get it for, they'll need to make a £40m profit for doing nothing, so however you look at it, the taxpayer gets screwed.

Could this come back and bite the council? If SISU turn round and sell the Ricoh on for a £40m profit not long after the council hand it over (if that ever happens) would there be any ramifications? I would have thought there would be some sort of law in place to stop assets being moved from the public ownership to private ownership at well below market value.

 

[stupot07]

Well whatever they get it for, they'll need to make a £40m profit for doing nothing, so however you look at it, the taxpayer gets screwed.

If the Ricoh/ACL and the club are united to become part of the same group of companies - wouldn't that add value all round? If we got into the championship our turnover would have more than doubled for doing so?


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[kmj5000]

Basically it does not add up to what we have been told

Surely not?

 

[blend]

I would love to see SISU do something similar to Everton and post a clear explanation of where the money has gone. Of the £39m showing as put in by SISU is there anything to indicate how much of that is in payments to themselves (i.e.: salaries to their own people, management fees, interest etc).

I still can't see anyway other than getting the Ricoh for nothing that SISU will ever be able to get this money back.

It would certainly be interesting to know, it seems the accounts are set up in such a way as to be not completely transparent. Certainly the interest amount being paid seems to be going up significantly each year. Would this equal about £5-6m so far in interest payments alone?

 

[shmmeee]

If the Ricoh/ACL and the club are united to become part of the same group of companies - wouldn't that add value all round?

£40m of value??

If we got into the championship our turnover would have more than doubled for doing so?

Hence "for doing nothing", though I'm not sure even promotion would add £40m, going down certainly didn't cost us that much.

 

[skybluetony176]

A lot thanks.

So why the switch to ARVO as our "bank"? Paying £1.2m/year in interest on a £9m (is that right, the other loans came since?) seems a lot (13%), even £1.2m on £16m is a fair whack (7.75%).

As a side note, I expect everyone saying the council was "bleeding the club dry" to be up in arms about the exact same amount going to our owners.

perhaps timmy should go out and find typical examples of interest payments on similar size loan's by other clubs and if they are considerably lower we should go on loan payment strike :sarcasm:

 

[AJB1983]

If the club and acl were united it'd surely load onto acl a whole load of liabilities that they aren't responsible for.
Also to me, this 'investment' sisu have made isn't, they are loans, not the same.

 

[The Prefect]

Therefore at 31/05/12 the actual cash put into the Group by 31/05/12 was around £30m (SISU £22m plus ARVO £8m). Since then ARVO have put in £9.1m by way of further loans making a total of £39m cash. To get to £60m as claimed that means a further £21m from somewhere. According to Mr Appleton first report there were £3m in losses for period to 22/03/13 so say all those losses needed to be financed (unlikely) then that leaves a difference of £18m that SISU claim to have spent to get to a total of £60m (loans, funding, investment call it what you will)

Basically it does not add up to what we have been told

There is a lot we (the fans) have been told by SISU since their takeover that doen't add up.

SISU (via Fisher mostly) seemingly 'over-egg' where possible to help their cause. It's understandable as they own the club. Think of the stadium plans now being behind Fisher's timescale he suggested at the Fans Forums. Then there's the 'non-operating' football club described by Fisher prior to administration. That statement about talks regarding the Ricoh's freehold when Ann Lucas issued an 'open' invitation to talk weeks ago. From the very first days of Ranson, SISU's policy was to mis-state facts (the 'debt free' is the biggest) in order for things to look much better to fans.

What has happened here is someone has decided to use the £60m debt as SISU's investment - because that's a bigger number than the reality. When the misleading statement is unravelled the inevitable comment of "I'm not an accountant," will follow.

Your figures match mine. I'm not convinced that the £60m is anything more than SISU's usual policy of 'debatable' facts. It has been going on since the first day they acquired the club and even before that when they did the same thing when talking to the shareholders before they took over. If SISU say they invested £40m I'd only believe them when the proved it with bank statements showing cash movements. The accounts show some things but not others. I believe them that loans are interest free but money can be lent with upfront arrangement fees / administration charges such as 'hedging' etc that don't show as interest in the accounts. This means they don't need interest as the real 'loans' will be less than the headline figure i.e. cash + non-cash items = loan.

If I shook Fisher or Seppala by the hand, I'd count my fingers afterwards. With Seppala's ability to record historic facts being part of court record - we should all be sceptical of anything the club says. For what it's worth I just wonder how much of the £40m might be made up of non-cash items such as administration fees / hedging feees / arrangement fees / management fees etc. It might be that all of the £40m is cash. Equally, that might not be the case.

There's no doubt that SISU have invested large sums of money (cash) keeping the club afloat as wages can't be paid using administration charges! Much of the mess the club is in is of their own making - so fans should expect them to continue to do so.

 

[stupot07]

If the club and acl were united it'd surely load onto acl a whole load of liabilities that they aren't responsible for.
Also to me, this 'investment' sisu have made isn't, they are loans, not the same.

Pretty much all football club owners 'invest' in their clubs in the form of loans, a few then turn some of those loans into equity.


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[shmmeee]

Pretty much all football club owners 'invest' in their clubs in the form of loans, a few then turn some of those loans into equity.


Sent from my iPhone using Tapatalk - so please excuse and spelling or grammar errors

I think the point is no one was claiming the Co-Op bank should get a statue for saving our club when they made a loan to us.

 

[stupot07]

I think the point is no one was claiming the Co-Op bank should get a statue for saving our club when they made a loan to us.

No but they would have clawed as much back as possible if it went tits up. They wouldn't have said ok mr Hoffman pay me £1 and I'll take the rest in IOU's. I can see sisu getting £40m back but they might get £15-20m if everything's reunited. It's still a return on their investment, just not a very good one.


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[chiefdave]

Pretty much all football club owners 'invest' in their clubs in the form of loans, a few then turn some of those loans into equity.

speaking of equity did I imagine this or did Fisher claim at a forum last season that the money SISU had put in had been converted to equity?

 

[oldskyblue58]

Otium has increased its issued share capital from £1000 to £501,000 in August 2013. Documents filed 23/10/13 I cant find any evidence of any other increases in share capital elsewhere in the group chiefdave

They had to increase to at least £500,000 (and by way of cash) in order to meet the FL insolvency policy as it applies to a new co situation in L1.

No details of who owns the shares issued or if they are "B" class non voting shares

 

[Captain Dart]

Could this come back and bite the council? If SISU turn round and sell the Ricoh on for a £40m profit not long after the council hand it over (if that ever happens) would there be any ramifications? I would have thought there would be some sort of law in place to stop assets being moved from the public ownership to private ownership at well below market value.

Tell that to Mr Osbourne :sarcasm:

 

[shmmeee]

Tell that to Mr Osbourne :sarcasm:

Why the sarcasm? Seems fairly bang on to me.

 

[chiefdave]

Found a report from Martin Bagot from the fans forum I was referring to

Chief executive Tim Fisher and development director Steve Waggott faced a grilling during the fans forum at the Standard Triumph Club in Tile Hill.

Controversial owners Sisu have committed to the club for the next three years. Sisu have now pumped pounds 42 million in to the club - pounds 35 million of which they have written off as equity.

Either I'm missing something here or the bit in bold appears to be an outright lie from Fisher? If they converted 35 million into equity how is there still so much owned to them?

 

[PWKH]

In the OP OSB said: "and £1m for the option on the Higgs share that should not have had a value"

How the Sisu web of companies account for things is up to them. It would appear that Labovitch and Fisher have signed accounts that in this instance are false. CCFC Ltd (ia) owns the Option on the Charity's shares in ACL. This Option cannot be transferred without the express permission of the Trustees, which has not been given. This makes the Directors' statement false. This not something that can be said to be careless or an oversight as it is a claim to value that is not true. Even they must notice £1m.

 

[Nick]

In the OP OSB said: "and £1m for the option on the Higgs share that should not have had a value"

How the Sisu web of companies account for things is up to them. It would appear that Labovitch and Fisher have signed accounts that in this instance are false. CCFC Ltd (ia) owns the Option on the Charity's shares in ACL. This Option cannot be transferred without the express permission of the Trustees, which has not been given. This makes the Directors' statement false. This not something that can be said to be careless or an oversight as it is a claim to value that is not true. Even they must notice £1m.

Can they not be done for fraud?

 

[TheRoyalScam]

In the OP OSB said: "and £1m for the option on the Higgs share that should not have had a value"

How the Sisu web of companies account for things is up to them. It would appear that Labovitch and Fisher have signed accounts that in this instance are false. CCFC Ltd (ia) owns the Option on the Charity's shares in ACL. This Option cannot be transferred without the express permission of the Trustees, which has not been given. This makes the Directors' statement false. This not something that can be said to be careless or an oversight as it is a claim to value that is not true. Even they must notice £1m.

Surely not? Our directors (especially TF) always tell the truth and are to be believed at all times........













.........or not, as the case may be;-)

 

[James Smith]

Can they not be done for fraud?

Did you mean can they please be done for fraud?

16. What are the possible penalties for failing to exercise my responsibilities as a director?

You could be held personally liable for losses resulting from illegal acts, acting beyond your powers, or failing to use sufficient skill and care.

You could become personally liable for company debts if you allow the company to trade while it is (or is likely to become) insolvent. If the company has difficulty meeting its financial obligations the directors should seek advice from an insolvency practitioner.

Some types of conduct can lead to disqualification from being a director. You might also be fined or face criminal prosecution — for example, for failing to keep proper accounting records, for fraudulent behaviour, or for serious health and safety shortcomings.

http://www.lawdonut.co.uk/law/owner...your-responsibilities-as-a-director-20-faqs#8

 

[shmmeee]

In the OP OSB said: "and £1m for the option on the Higgs share that should not have had a value"

How the Sisu web of companies account for things is up to them. It would appear that Labovitch and Fisher have signed accounts that in this instance are false. CCFC Ltd (ia) owns the Option on the Charity's shares in ACL. This Option cannot be transferred without the express permission of the Trustees, which has not been given. This makes the Directors' statement false. This not something that can be said to be careless or an oversight as it is a claim to value that is not true. Even they must notice £1m.

Stop me if I'm wrong, but as this is SBS&L before CCFC Ltd went into admin, couldn't they still list the share option as an asset? Next year's accounts obviously couldn't, but as of 31/5/13 AFAIK it was the old web of companies.

 

[PWKH]

Shmmee: this must be one for OSB. As the asset is in CCFC Ltd in administration SBS&L no longer can claim any asset. Perhaps they should have put in a note to that effect as the administration of Ltd happened before the sign off of the SBS&L accounts.

 

[shmmeee]

Shmmee: this must be one for OSB. As the asset is in CCFC Ltd in administration SBS&L no longer can claim any asset. Perhaps they should have put in a note to that effect as the administration of Ltd happened before the sign off of the SBS&L accounts.

I'll take your word for it, just offering a possible reason from my layperson's brain