Group Financial Statements

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Group Financial Statements

Postby dpa » 16 Apr 2019, 06:22

https://beta.companieshouse.gov.uk/company/11363843/filing-history

Click to open the PDF under 'group of companies accounts'.

These represent an interesting set of accounts as it shows the enhanced value of 'The Hive' and all of its parts therein. You will see a massive uplift post 'revaluation'. How that 'revaluation' has been achieved will depend upon how the valuer has approach the assessment and what 'comparables' they have used to define the 'market value'. It will be based upon a combination of 'brick & mortar' (i.e. land value) and a multiple of the trading income (CTA/FMT).

So when TK advises the press that the Hive is worth £100m....he is actually undervaluing the complex and all its parts (according to the financial statements).
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Re: Group Financial Statements

Postby MCB » 16 Apr 2019, 07:11

Fascinating stuff. Still need a forensic accountant to pick everything apart. Anyone care to make a start?

Remember this is upto 30 June 18, so we're a league club. Losses due to relegation offset by FA Cup run tbc..

Not sure if these include Parachute Payments.

Anyone confirm these?

Mens Club made £500,000+ profit, offset by academy losses of £1,100,000 so roughly a loss of 600k. Academy losses to rise due to cuts in funding post relegation?

Club turnover £3 million = very high for L2?

Pecking Order made big, big losses. Thus it was shut. Jako also loss making, as was imaging centre, but that was barely, if at all, open so expected.

Why did the value of the group jump £150 million? Is that value of The Hive? The group?

Overall, £6 million profit but is the club now 1/50th of the groups revenue?

So many questions I'm unqualified to answer! How many non league football clubs have 250 staff and contribute so much in taxes though...

Anyway, hands up any accountants!

Edit - that was very early.

Shareholders Funds is a rough calculation of what Shareholders would receive should the companies assets be liquidated. TK is the only Shareholder.

This has gone from £15 mill to £124 million. I have no idea why!
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Re: Group Financial Statements

Postby John_c » 16 Apr 2019, 10:53

Does owning the freehold of the land at The Hive make that difference to the valuation?

Also. Valuations are a bit of a misnomer. It's only ever worth whatever someone wants to pay for it. Which is currently nothing.

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Re: Group Financial Statements

Postby X-Bumble » 16 Apr 2019, 11:09

John_c wrote:Does owning the freehold of the land at The Hive make that difference to the valuation?

Also. Valuations are a bit of a misnomer. It's only ever worth whatever someone wants to pay for it. Which is currently nothing.

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I was going to say the same thing John. Any business is only worth what someone eventually pays for it. The rest of it is just estimation and guess work.
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Re: Group Financial Statements

Postby Edd1 » 16 Apr 2019, 12:27

As above revaluations are meaningless in terms of profitability of the club.

Where they can be interesting though is if the club is seeking to borrow money. Banks are always willing to lend more and at a lower interest rate to a business sat on some nice juicy assets like freehold property as opposed to businesses who's balance sheets are mostly nebulous old toss like goodwill.

I'll have a closer look when I have time.
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Re: Group Financial Statements

Postby dpa » 17 Apr 2019, 07:24

X-Bumble wrote:
John_c wrote:Does owning the freehold of the land at The Hive make that difference to the valuation?

Also. Valuations are a bit of a misnomer. It's only ever worth whatever someone wants to pay for it. Which is currently nothing.

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I was going to say the same thing John. Any business is only worth what someone eventually pays for it. The rest of it is just estimation and guess work.


The underlying reason for my original post is that I work in Corporate finance; have done for 30 years. I spend most days analysing balance sheets, cashflows and professional valuations - I have a professional interest in such matters.

As I mooted in my original post, a business valuation is subjective. In my experience reliance upon Business valuations is fraught with danger as they, more often than not, are proven to be inaccurate. As suggested above, the complex will be only worth what someone is willing to pay and there are few entities who have the capital base who could afford (or want) such an investment.

What the financial statements above do show however is the positive impact of the changes made at the Hive.

The 'group' is now generating sales in excess of £10m, is profitable, has substantial cash balances and a very strong net worth* with fairly modest gearing. Whilst we could all debate the true market value of the underlying asset* and pick holes, the financial statements show an overall positive position which must surely be considered a good thing for the football club (which is part of the group) - when so many other football clubs are struggling financially.
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Re: Group Financial Statements

Postby South_Belfast_Bee » 17 Apr 2019, 07:36

Whilst, as dpa points out, there are a lot of positives in terms of stability given what we are currently hearing about the likes of Bolton, the football fan (and cynic) in me worries that the football team is simply just ‘part of the group’, rather than at the forefront with other services being used to support it. In other words, if the football club is ticking over and the money is rolling in through other channels, what’s the incentive to invest (or waste money) in the team?
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Re: Group Financial Statements

Postby Hiveoccupier » 17 Apr 2019, 07:40

John_c wrote:Does owning the freehold of the land at The Hive make that difference to the valuation?

Also. Valuations are a bit of a misnomer. It's only ever worth whatever someone wants to pay for it. Which is currently nothing.

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You are probably right about the club. I would have thought the 44 acre Hive complex is worth a very significant sum that buyers would be prepared to pay.

Arguably they might pay more for it without the commitments surround the football club.
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Re: Group Financial Statements

Postby finchleyman » 17 Apr 2019, 08:02

I am interested in the land valuation of £125 million. I was under the impression that TK had a ten year lease on the land although this may have been extended and hence he was able to invest in the facilities. So, he must have procured the freehold somehow or the other and the land equates to 44 acres in size in what is generally a reasonably prime residential area,

I can only think that the land has been valued with the "hope" value of residential use added because as a leisure area there is no way that it can be valued at £125millon. Residential land might be worth around £3 million per acre (ten houses at £300K per plot).

The accounts do not say how the land was valued but if any banks etc are lending money on this valuation, the valuer had better ensure his professional indemnity insurance is up to date!
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Re: Group Financial Statements

Postby Hiveoccupier » 17 Apr 2019, 08:09

finchleyman wrote:I am interested in the land valuation of £125 million. I was under the impression that TK had a ten year lease on the land although this may have been extended and hence he was able to invest in the facilities. So, he must have procured the freehold somehow or the other and the land equates to 44 acres in size in what is generally a reasonably prime residential area,

I can only think that the land has been valued with the "hope" value of residential use added because as a leisure area there is no way that it can be valued at £125millon. Residential land might be worth around £3 million per acre (ten houses at £300K per plot).

The accounts do not say how the land was valued but if any banks etc are lending money on this valuation, the valuer had better ensure his professional indemnity insurance is up to date!


He bought the Freehold off Harrow Council for about £2m ? a couple of years back. The 10 year issue was the period of temporary dispensation he had to play League Football at the Hive, not the lease which was always long term (99 years I believe)

The new valuation is TKs assessment of market value of the combined holdings Group. Is something going on to increase the value of capital depreciation for tax advantage ?

It also looks like he might have repatriated assets previously held in Cyprus, if not the whole set of accounts looks far more transparent than it was previously.
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Re: Group Financial Statements

Postby John_c » 17 Apr 2019, 08:16

finchleyman wrote:I am interested in the land valuation of £125 million. I was under the impression that TK had a ten year lease on the land although this may have been extended and hence he was able to invest in the facilities. So, he must have procured the freehold somehow or the other and the land equates to 44 acres in size in what is generally a reasonably prime residential area,

I can only think that the land has been valued with the "hope" value of residential use added because as a leisure area there is no way that it can be valued at £125millon. Residential land might be worth around £3 million per acre (ten houses at £300K per plot).

The accounts do not say how the land was valued but if any banks etc are lending money on this valuation, the valuer had better ensure his professional indemnity insurance is up to date!
The lease would stipulate something about its use I imagine. Hence the price paid. Would be strange if a valuer didn't use that as reference.

If the group is making circa £6million then sale value of the whole group (with a broad brush approach) should be 5/6 times annual profit. £30 million. Not bad?

As for the argument over money in the Football Club. It would seem that whilst the group doesn't overly rely on it, the FC is an important integral part. As are other parts. It's an impressive set up.

TK will run the FC as he always has done, with an irritatingly close hold on the purse strings. I'm hoping there's a bit more in next seasons budget to allow someone to get us promoted.

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Re: Group Financial Statements

Postby MCB » 17 Apr 2019, 08:50

Hiveoccupier wrote: It also looks like he might have repatriated assets previously held in Cyprus, if not the whole set of accounts looks far more transparent than it was previously.


Yup, the holding company was previously based in Cyprus - where you don't have public access to the records online (you have to rock up in person and pay a fee) so for the first time we get a clearer view of where we are.

This article from 10 years ago shows how far we've come: https://www.standard.co.uk/business/mar ... 07550.html - from that to this is 10 years is phenomenal.

Apart from WD1A (Caredeal, Evendeal, Fairdeal) which turns out a tasty profit, and I have NO idea who or what they are, all of the subsiduary companies (and there are a few) are reliant on The Hive which is reliant in turn on Barnet FC.

I'm a little happier now that the group accounts are in the UK, would appreciate a forensic accountant going through with a fine toothcomb to explain what's happening. But I would like to know about 'succession' - the club will be around long after TK. The group is entirely based on TK (and Mohindra Patel, who is the new Andrew Adie, I assume an accountant who largely signs things).

What happens if TK falls ill, gets run over by a bus tomorrow, gets fed up with those calling for 'TK Out' (I feel these people have got it wrong, it should be Barnet FC out of TK rather than the other way round, if TK does sell up Barnet FC which I'm sure he would for a quid, where do we go?). I'd like to see Barnet FC futureproofed.
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Re: Group Financial Statements

Postby X-Bumble » 17 Apr 2019, 08:56

dpa wrote:
X-Bumble wrote:
John_c wrote:Does owning the freehold of the land at The Hive make that difference to the valuation?

Also. Valuations are a bit of a misnomer. It's only ever worth whatever someone wants to pay for it. Which is currently nothing.

Sent from my SM-N960F using Tapatalk


I was going to say the same thing John. Any business is only worth what someone eventually pays for it. The rest of it is just estimation and guess work.


The underlying reason for my original post is that I work in Corporate finance; have done for 30 years. I spend most days analysing balance sheets, cashflows and professional valuations - I have a professional interest in such matters.

As I mooted in my original post, a business valuation is subjective. In my experience reliance upon Business valuations is fraught with danger as they, more often than not, are proven to be inaccurate. As suggested above, the complex will be only worth what someone is willing to pay and there are few entities who have the capital base who could afford (or want) such an investment.

What the financial statements above do show however is the positive impact of the changes made at the Hive.

The 'group' is now generating sales in excess of £10m, is profitable, has substantial cash balances and a very strong net worth* with fairly modest gearing. Whilst we could all debate the true market value of the underlying asset* and pick holes, the financial statements show an overall positive position which must surely be considered a good thing for the football club (which is part of the group) - when so many other football clubs are struggling financially.


Sorry, I wasn't criticising or questioning you. Didn't mean it that way.
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Re: Group Financial Statements

Postby b4life » 17 Apr 2019, 18:03

If TK was as good at picking managers as he clearly must be in running the Hive, we’d be in the Premier League!
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Re: Group Financial Statements

Postby MCB » 17 Apr 2019, 21:56

b4life wrote:If TK was as good at picking managers as he clearly must be in running the Hive, we’d be in the Premier League!


Preach.
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