commentary on SBS& L group 2014 accounts (3 Viewers)

[oldskyblue58]

Please keep in mind that
- these are the only accounts that give the whole figures for the clubs operation between 01/06/13 and 31/05/14
- The group accounts give the details of all external debt and exclude any transactions between group companies
- the only trading part of the group was CCFC whether owned by CCFC l/ CCFC h or Otium

The Strategic Report is very similar to the one with the Otium accounts. It sets the directors(/owners?) view of what went on and how they plan going forward in the future. It includes selected facts and is from the directors point of view. Only comment I would make in addition is that there is a known legal process involved that has been used - who set the pace in that you can make your own minds up on. In simple terms was it a dispute or just non payment?

The audit report again contains an emphasis of matter regarding going concern. As did Otium as it has in previous years. The directors must have convincing plans, budgets etc for at least the next 12 months from the date the accounts were signed off 27/02/15

The Figures. SBS&L is a holding company all trading was done by the football club which is OEG trading as CCFC

Turnover down 2.8m at 3.75m
Direct costs down by 1.3m at 1.11m
staff costs down by 1.6m at 6.9m
Administrative expenses including goodwill write off (1.5m) are similar at 4.15m
Profit on players was 938k
Interest payable by 820k at 2.66m (all due to ARVO/SISU investors it looks)
Loss up from 7.1m to 8.5m

The downturn in turnover has been covered by the decrease in costs. Administrative expenses in terms of trading are down to 2.6m so total cost savings 5.5m with income reduced 2.8m but losses increased 1.4m.

Another thought is that the cost of acquiring the assets of CCFC Ltd were subsequently paid out to the administrator etc. Could you argue SBS&L have born that charge in its P&L account?

All depends how you want portray or comment on things I suppose?

On the Balance Sheet all creditors are shown as under 1 year as was changed to in the 2013 accounts. If the debt to SISU investors for instance was long term and no intention to collect in next 12 months then why not show as due in over 1 year?

The voting shares in issue remain at 13,698 so no change in ownership percentage. SISU as agents for their investors have the right to exercise those votes and therefore control SBS&L Group of companies

Balance sheet deficit has decreased from 44.721m to 39.19m because loan debt has converted to equity primarily

According to the cash flow state the group received new loans of 2.8m and issued 3.295 non voting preference shares - all from ARVO I believe. For the past two years (2013 & 2014) the cash flow has been negative

Match day income was 1.14m down from 2.996m
Commercial income was 2.614m down from 3.575m
reflects more than anything the refusal of many fans to go to Sixfields

The goodwill of purchasing CCFC Ltd from the administrator has been written off - no surprise really it was worthless without the golden share which the FL allocated to Otium

The 471k due to ACL has been included (highlighted?) but I dont think it was paid over until later in 2014 was it?

Wages total for the full period was down to 5.488m from 7.039m. That covered 102 players (2013 122) 28 admin staff (2013 41) and Part time stewards 287 (2013 375) Thats all employees for the year not the total on one date.

Directors remuneration was 240k of which 120k was paid by Otium. Who got what we do not know

Interest on loans from ARVO and the SISU investors was 2.66m at 31/05/14 SISU investors were owed 28.554m and ARVO 8.207m. During the year it appears at least some interest was paid to ARVO as the accrual compared to 2013 has dropped although the cash flow statement doesnt indicate this.Total accrued to both by 31/05/14 was 1.66m (2013 1.98m) JS is at minimum agent for ARVO because she signs court documents for them

There have been no preference shares issued since August 2014

ARVO loans have decreased by 5.2m - probably at least partly converted to preference shares

Bottom line is that the Group still owes ARVO and SISU investors substantial funds 36.7m and the preference shares are in reality a lower level of debt but still a debt of sorts.

Apparently we are now nearer breaking even and cash flow positive ...... to be honest i find that hard to believe

 

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[ccfcway]

i prefer the telegraph, they made it sound better :laugh:

 

[martcov]

Please keep in mind that - these are the only accounts that give the whole figures for the clubs operation between 01/06/13 and 31/05/14- The group accounts give the details of all external debt and exclude any transactions between group companies- the only trading part of the group was CCFC whether owned by CCFC l/ CCFC h or OtiumThe Strategic Report is very similar to the one with the Otium accounts. It sets the directors(/owners?) view of what went on and how they plan going forward in the future. It includes selected facts and is from the directors point of view. Only comment I would make in addition is that there is a known legal process involved that has been used - who set the pace in that you can make your own minds up on. In simple terms was it a dispute or just non payment? The audit report again contains an emphasis of matter regarding going concern. As did Otium as it has in previous years. The directors must have convincing plans, budgets etc for at least the next 12 months from the date the accounts were signed off 27/02/15The Figures. SBS&L is a holding company all trading was done by the football clubTurnover down 2.8m at 3.75m Direct costs down by 1.3m at 1.11mstaff costs down by 1.6m at 6.9mAdministrative expenses including goodwill write off (1.5m) are similar at 4.15m Profit on players was 938k Interest payable by 820k at 2.66m (all due to ARVO/SISU investors it looks)Loss up from 7.1m to 8.5m The downturn in turnover has been covered by the decrease in costs. Administrative expenses in terms of trading are down to 2.6m so total cost savings 5.5m with income reduced 2.8m but losses increased 1.4m. Another thought is that the cost of acquiring the assets of CCFC Ltd were subsequently paid out to the administrator etc. Could you argue SBS&L have born that charge in its P&L account? All depends how you want portray or comment on things I suppose? On the Balance Sheet all creditors are shown as under 1 year as was changed to in the 2013 accounts. If the debt to SISU investors for instance was long term and no intention to collect in next 12 months then why not show as due in over 1 year? The voting shares in issue remain at 13,698 so no change in ownership percentage. SISU as agents for their investors have the right to exercise those votes and therefore control SBS&L Group of companiesBalance sheet deficit has decreased from 44.721m to 39.19m According to the cash flow state the group received new loans of 2.8m and issued 3.295 non voting preference shares - all from ARVO I believe. For the past two years (2013 & 2014) the cash flow has been negativeMatch day income was 1.14m down from 2.996m Commercial income was 2.614m down from 3.575m reflects more than anything the refusal of many fans to go to SixfieldsThe goodwill of purchasing CCFC Ltd from the administrator has been written off - no surprise really it was worthless without the golden share which the FL allocated to OtiumThe 471k due to ACL has been included (highlighted?) but I dont think it was paid over until later in 2014 was it? Wages total for the full period was down to 5.488m from 7.039m. That covered 102 players (2013 122) 28 admin staff (2013 41) and Part time stewards 287 (2013 375) Thats all employees for the year not the total on one date. Directors remuneration was 240k of which 120k was paid by Otium. Who got what we do not knowInterest on loans from ARVO and the SISU investors was 2.66m at 31/05/14 SISU investors were owed 28.554m and ARVO 8.207m. During the year it appears at least some interest was paid to ARVO as the accrual compared to 2013 has dropped although the cash flow statement doesnt indicate this.Total accrued to both by 31/05/14 was 1.66m (2013 1.98m) JS is at minimum agent for ARVO because she signs court documents for them There have been no preference shares issued since August 2014ARVO loans have decreased by 5.2m - probably at least partly converted to preference sharesBottom line is that the Group still owes ARVO and SISU investors substantial funds 36.7m and the preference shares are in reality a lower level of debt but still a debt of sorts. Apparently we are now nearer breaking even and cash flow positive ...... to be honest i find that hard to believe

Question: where is the "golden share" now (whose asset is it? ) and how, if at all, is it valued? I would think that the share and the player's registrations are the most valuable assets.

 

[oldskyblue58]

The share is held by Otium. It is held in trust and belongs to the FL. There is no cost and therefore no value in the accounts. Doesnt mean it doesnt have a "value" to the club but its very intangible in that it is a right to trade/play in the FL nothing more

Players are valued at purchase cost less amortisation over the life of the contract ....... what cost has there been ?

 

[tisza]

so how can TF now claim that 90% of the companies liabilities have now been written off when there is still loans of 39 million?

 

[DaleM]

so how can TF now claim that 90% of the companies liabilities have now been written off when there is still loans of 39 million?

How many times have we been "debt free" ?
Apparently a couple of months back we were breaking even .

 

[steveecov]

How many times have we been "debt free" ?
Apparently a couple of months back we were breaking even .

That was probably before we had to send Mavis out for biscuits.

 

[martcov]

The share is held by Otium. It is held in trust and belongs to the FL. There is no cost and therefore no value in the accounts. Doesnt mean it doesnt have a "value" to the club but its very intangible in that it is a right to trade/play in the FL nothing more

Players are valued at purchase cost less amortisation over the life of the contract ....... what cost has there been ?

Thanks for the info. Basically the Players and share ( use of ) are worth whatever a buyer will pay on the day we sell them in reality. So without Arvo and SISU's support we are worthless - and that is apparently the best Position since SISU took over. Doesn't fill me with confidence.

 

[Jonty1]

You can only show as debt greater than 12 months if that was the contractual position at the balance sheet date.

You are assuming the loan interest was paid but it could have been part of the debt to equity conversion.

 

[oldskyblue58]

You can only show as debt greater than 12 months if that was the contractual position at the balance sheet date.

You are assuming the loan interest was paid but it could have been part of the debt to equity conversion.

Wouldn't disagree with that.

However the same debt in the 2012 accounts was classified as over 12 months. They changed the classification in 2013 accounts. If the intention is to be long term owners and no intention to withdraw capital then I would like to understand the thinking as to why now under 12mths. It would seem it is easy change the contractual obligation to suit.

Actually from the accounts then it is clear the interest was not paid in cash. Accrued to 31/05/13 there was 1.9m accrued during 2014 2.6m was charged totalling 4.5m in interest but there was only 1.6m still to be settled/paid by 31/05/14. Clearly the interest has been either capitalised in to loans or share issue.

 

[Godiva]

- there is 2.098m interest payable for the year - now it might all not have been paid out yet but it is contractually due - note in account says that 1.39m remains accrued at the year end so something must have been paid out

But as there is 0 (NIL) in Loan Repayment (under Financing), then the difference in Interest Payable and Interest Accrued must have been converted to equity?
I know I am looking in SBS&L consolidated cash flow statement - there is no such statement in the Otium accounts.

Actually from the accounts then it is clear the interest was not paid in cash. Accrued to 31/05/13 there was 1.9m accrued during 2014 2.6m was charged totalling 4.5m in interest but there was only 1.6m still to be settled/paid by 31/05/14. Clearly the interest has been either capitalised in to loans or share issue.

Thank God! Now please send me my F**king diploma :claping hands:

 

[oldskyblue58]

Its in the post :laugh: ...... in simple terms the interest was paid/settled but not in cash

 

[Sub]

so we are still in massive debt, it just being moved around to make it look like we are not, is that right OSB?

 

[oldskyblue58]

so we are still in massive debt, it just being moved around to make it look like we are not, is that right OSB?

pretty much ...... you have to look at the whole Group not just part...... the external debt even be it the owners is huge for an entity with no real assets or security of tenure

 

[Sub]

pretty much ...... you have to look at the whole Group not just part...... the external debt even be it the owners is huge for an entity with no real assets or security of tenure

Thanks OSB so what is the total debt of all the businesses in the group that have a connection to CCFC ? (basically CCFC total debt) ?

 

[oldskyblue58]

total creditors are 41m (approx. 39m owed to ARVO/SISU investors including accrued interest) and the balance sheet net position is minus 39m

 

[Sub]

total creditors are 41m (approx. 39m owed to ARVO/SISU investors including accrued interest) and the balance sheet net position is minus 39m

Is this from a position of being so called 'debt free' after administration ?

 

[Mr T - Sukka!]

TF - CCFC are cash flow positive.
TF - CCFC are debt free.

Paint and potray a rosy image.
Accounts suggest otherwise.

 

[shmmeee]

total creditors are 41m (approx. 39m owed to ARVO/SISU investors including accrued interest) and the balance sheet net position is minus 39m

So... we're basically where we were before the admin in terms of debt, right?

Speculation obviously, but does that mean that the FL asked for Otium to have it's debt converted into equity in return for the GS as suggested yesterday, but they haven't done that, just moved it around?

Or am I clutching at straws in the hope the FL will read this and take the share back off them?

 

[shmmeee]

TF - CCFC are cash flow positive.
TF - CCFC are debt free.

Paint and potray a rosy image.
Accounts suggest otherwise.

To be fair, I can see from those accounts how we could be cashflow positive this season. Especially when you consider we sold Wilson.

 

[Evo1883]

I dont normally look at or get involved in finance threads .
Who is OSB and why does he seemingly know more than most ..not a dig i just want to know as i dont get involved

 

[oldskyblue58]

I wouldn't think the FL had anything to do with it, certainly not how I read the strategic report when it discusses that.

The external debt hasn't changed much. All this focus on the conversion of 60.9m is more smoke and mirrors and the CT article focussed its headline on the wrong thing in my opinion

 

[Godiva]

Thank God! Now please send me my F**king diploma :claping hands:

Its in the post :laugh:

Wow!

 

[oldskyblue58]

so far we have still owed by SBS&l 39m ........ converted in to shares in otium 60.9m ....... CCFC H transferring debt to Otium 60.9m....... and the administration of CCFC ltd writing off 70m in irrecoverable amounts........ just how much real debt can one club generate?

This is all perfectly legal use of the legal and accounts systems ............ no wrong doing as far as I can see but the one original amount of investment has become, by use of the group structure, several different debts to be utilised

Its quite clever really even if somehow it doesn't seem to me morally right

 

[Sub]

so far we have still owed by SBS&l 39m ........ converted in to shares in otium 60.9m ....... CCFC H transferring debt to Otium 60.9m....... and the administration of CCFC ltd writing off 70m in irrecoverable amounts........

This is all perfectly legal use of the legal and accounts systems ............ no wrong doing as far as I can see but the one original amount of investment has become by use of the group structure several different debts to utilised

Its quite clever really even if somehow it doesn't seem to me morally right

So we are 60million in the hole still ? not one big hole but many holes with smaller amounts in them >?

 

[oldskyblue58]

no £39m in the hole as a group

 

[shmmeee]

SOMEONE TELL ME WHAT'S GOING ON!

Simon and Fisher say we're debt free. OSB says it's just in another company.

WHY IS THIS SO HARD!?

 

[Sub]

no £39m in the hole as a group

How the hell are we 40 million in debt with no assets hardly any players of a decent standard and how the F£%$ does fisher claim we are in a better place than when they came in ?

 

[chiefdave]

To me if the FL have said x amount of debt must be written off then they need to step in here and take a look at what happens as it's just been shifted elsewhere. Of course they might just have said the debt must not exist in a particular company which as we can see is not a lot of use to anyone.

 

[jimmyhillsfanclub]

I dont normally look at or get involved in finance threads .
Who is OSB and why does he seemingly know more than most ..not a dig i just want to know as i dont get involved

I used to think I had a fair understanding of the details.....these days I know I don't & certainly don't have the time, patience or inclination to learn more about the forensic details of CCFC finances....

I think I can still summarise pretty well though.....

Before Sisu arrived, CCFC were fucked.
Before these latest accounts were filed, Sisu had ensured CCFC were well fucked.
Now, its clear CCFC are still fucking fucked.

Happy Friday!

 

[oldskyblue58]

Playing with words shmeee

TF is saying that there is no external finance owing other than to the owners ARVO/SISU. He is trying to portray this as not normal debt and therefore because it is the owners it is ok to ignore it and say we owe no one else. We still owe the owners though and the total due to them 31/05/14 was 39m including accrued interest - it is still debt otherwise it would not have been included under the heading of creditors due within 1 year

Simon - sorry but I think there are a number of inaccuracies in his report. If he has said we are debt free then that is simply wrong. Which ever company you look at or the group as a whole there are loans owed to the owners - that is debt

I can only tell you what the accounts say in my opinion, based on being a qualified accountant with 30 years experience

 

[shmmeee]

To me if the FL have said x amount of debt must be written off then they need to step in here and take a look at what happens as it's just been shifted elsewhere. Of course they might just have said the debt must not exist in a particular company which as we can see is not a lot of use to anyone.

Depressingly, the FL falling for the old "Oh no, not in this company" trick sounds like exactly something they'd do.

 

[shmmeee]

Playing with words shmeee

TF is saying that there is no external finance owing other than to the owners ARVO/SISU. He is trying to portray this as not normal debt and therefore because it is the owners it is ok to ignore it and say we owe no one else. We still owe the owners though and the total due to them 31/05/14 was 39m including accrued interest - it is still debt otherwise it would not have been included under the heading of creditors due within 1 year

Simon - sorry but I think there are a number of inaccuracies in his report. If he has said we are debt free then that is simply wrong. Which ever company you look at or the group as a whole there are loans owed to the owners - that is debt

I can only tell you what the accounts say in my opinion, based on being a qualified accountant with 30 years experience

To be fair OSB, you've never steered us wrong IMO and the writeoff of tens of millions of debt did seem a little too good to be true.

I wish someone with Fisher's ear would tell him that this sort of stuff is counter productive. Just be 100% open and honest with us otherwise it ends up biting you on the bum.

We can all accept we're £40m in debt or losing £xm a year or whatever, it's all most of us have ever known. But this kind of thing never goes down well with fans, no matter how good you think it'll sound at the time, the details usually come out pretty quick these days.

 

[skybluetony176]

total creditors are 41m (approx. 39m owed to ARVO/SISU investors including accrued interest) and the balance sheet net position is minus 39m

So as the debt to the owners is not real debt the clubs only £2M in debt and that's been covered by the Wilson sale. See Mr Fisher is correct when he says we're debt free

 

[lewys33]

A bit of clever manipulation.