Fairline Sold

username said:
1) As of the end of last year, Fairline were making an operational profit. I assume this remains the case.
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According to their end Dec 2013 results they didn't even make a gross profit (how is that possible in a supposedly well managed company?) let alone an operating profit. In fact their accounts don't make very good reading at all but then without knowing the inside story on how the numbers were compiled you can't really make a definitive judgement
 
Deleted User said:
According to their end Dec 2013 results they didn't even make a gross profit (how is that possible in a supposedly well managed company?) let alone an operating profit. In fact their accounts don't make very good reading at all but then without knowing the inside story on how the numbers were compiled you can't really make a definitive judgement
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My thoughts too Mike, as you say don't know how they are compiled.

Headline numbers on the face of it are not good from what I can see accounts show (2013) a net worth of minus £28.5 million, Pre tax loss of £17 million, GP of minus 3.5 million and T/O dropping from £79 million in 2011 accounts to £56 million on the 2013 accounts.

Wessex Bristol Investments last accounts show net worth of £357k, while they appear operate the individual businesses as stand alone they don't seem to have on the face of it cash themsleves to pump into Fairline for product development etc unless they are going to rob Peter to pay Paul (or Fairline in this case).

Its interesting for sure.
 
I disagree.

The main thing you can read into this in my view is that the buyer has no credible plan. An action of laying off one assumes good numbers of staff in your first few days suggests several things ( most bad)

- you don't understand what you have bought and have panicked
- a disregard for the staff - which forgetting any emotional arguments - are the ones that know how to make you complex and about intensive product
- you send shock waves to dealers, who now seem to have no skin in the game, and more particularly current customers whose boats are built built, prospects who will simply walk away and existing customer (me!) with warranty obligations which further damages the business - reputation is very difficult to gain
- you are looking to asset strip or similar

Within this I assume that Fairline is losing money in cash terms ( forget profit) and they are looking to stem the tide - that is probably a more sad inditement of Better Capital than anyone else.

Further they have no communicated to people - on their web site for example.

This is not a secret - Google Fairline and the storey comes above the Fairline web site. So you can stick your head in the sand and let forums like this speculate or communicate and manage the situation.
 
petem said:
There, fixed that for you. What matters more is what happens in the coming weeks / months. Too early to write off the new owners yet IMO.
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I, too was in the category of "hopeless optimist" when Sealine went down the pan.
But I do still hope for the best possible outcome, which would be a continuation of production with a slimmed down range and a smaller workforce.
 
petem said:
Too early to write off the new owners yet IMO.
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P, I'm afraid that the sentences quoted in the linked article, are already enough to write off at least the new CEO:
"To address the immediate short term issues, we have made the regrettable yet unavoidable decision to instigate a temporary layoff of a number of staff for a period of four weeks as we continue to assess the business.
This is no way an indication of the long term vision for Fairline...”

First of all, c'mon, you didn't assess the business before taking over? This is so clearly a joke that it's not even funny.
They obviously decided in advance that the layoff was the first thing to do, regardless of any further assessment to be made.
In this sense, I disagree with the first point envisaged by jrudge - this clearly can't be a panicked decision.

Secondly, "long term vision"?!? From a financial investor? "Define long term!" is what the journo should have asked him... :ambivalence:
 
jrudge said:
I disagree.

The main thing you can read into this in my view is that the buyer has no credible plan. An action of laying off one assumes good numbers of staff in your first few days suggests several things ( most bad)

- you don't understand what you have bought and have panicked
- a disregard for the staff - which forgetting any emotional arguments - are the ones that know how to make you complex and about intensive product
- you send shock waves to dealers, who now seem to have no skin in the game, and more particularly current customers whose boats are built built, prospects who will simply walk away and existing customer (me!) with warranty obligations which further damages the business - reputation is very difficult to gain
- you are looking to asset strip or similar

Within this I assume that Fairline is losing money in cash terms ( forget profit) and they are looking to stem the tide - that is probably a more sad inditement of Better Capital than anyone else.

Further they have no communicated to people - on their web site for example.

This is not a secret - Google Fairline and the storey comes above the Fairline web site. So you can stick your head in the sand and let forums like this speculate or communicate and manage the situation.
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Absolutely spot on. I've emboldened what is the to my mind the key point for the medium to long term.
 
MapisM said:
P, I'm afraid that the sentences quoted in the linked article, are already enough to write off at least the new CEO:
"To address the immediate short term issues, we have made the regrettable yet unavoidable decision to instigate a temporary layoff of a number of staff for a period of four weeks as we continue to assess the business.
This is no way an indication of the long term vision for Fairline...”

First of all, c'mon, you didn't assess the business before taking over? This is so clearly a joke that it's not even funny.
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Not a joke at all. On the basis that the sale of the company came as a surprise to everyone, I think its safe to conclude that the due diligence was done covertly. Spending a few weeks, after completion of the purchase, to get a full assessment of the business, is absolutely the right thing to do. That will involve talking to staff, dealers and customers.

MapisM said:
They obviously decided in advance that the layoff was the first thing to do, regardless of any further assessment to be made.
In this sense, I disagree with the first point envisaged by jrudge - this clearly can't be a panicked decision.
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Assuming the order book is not sufficiently healthy to keep all the staff occupied, this is an understandable course of action to buy some time.

Pete
 
The odd thing as well with this is that Fletcher by comparison, everyone there was upbeat and really excited @ sibs. They told me they will now have a team of designers again, and that they are already starting on new future products. In addition at the last moment they apparently increased the size of their SIBS stand and had everything from their range of boats on display.

Whatever is really going on, I have no idea...
 
petem said:
Not a joke at all. On the basis that the sale of the company came as a surprise to everyone, I think its safe to conclude that the due diligence was done covertly. Spending a few weeks, after completion of the purchase, to get a full assessment of the business, is absolutely the right thing to do
Pete
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I think that is the point - the new owners have taken no time to assess the business before making decisions to lay off a lot of the work force. To make decisions this quickly a plan was in place at the time of aquisition -and that's normal.

Anyone buying a business without fully understanding the ramifications and having a strategy is like buying a used super yacht without a survey?
 
pks1702 said:
I think that is the point - the new owners have taken no time to assess the business before making decisions to lay off a lot of the work force.
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Firstly, they are temporary not permanent lay offs. And how do you know the logic is not simple? Perhaps they have no SQ78 orders and its a very obvious response to send the guys working on that line home for a month. I have absolutely no idea if its that simple or not and doubt many on here do either.
 
petem said:
I think its safe to conclude that the due diligence was done covertly.
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Agreed, but covertly doesn't imply stupidly.
Trust me P, I could write a book on how these folks can put a company on its knees while still making a sound profit for themselves, but "stupid" is not one of the many adjectives I could use to describe them.
 
petem said:
Please feel free to shoot me down but this is the situation as I understand it
[...]
4) The Targa 53 was warmly received by the boating press.
[...]
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I'm not trying to be a smart ass, but, when was the last time the boating press didn't receive a boat well? Hell when was the last time a boat that was still afloat in the end of the sea trail got a bad review? The boating press is hardly a bastion of critical journalism and I assume that most exoerienced buyers put little stock in the opinions of the boating mags.
 
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