![Laughing :lol:](./images/smilies/icon_lol.gif)
Another tough year for Stadco in their latest accounts.
Kassam has had to loan another £400k from the parent company, and has had to refinance the bank loan. Somewhat surprising this as it was due to be fully repaid in the current year, but now won't be repaid for 5 years.
Reduced turnover, which has led to another reduction in staff to keep costs down. Tiny operating profit wiped out by bank loan interest.
The group has stopped charging inter-company interest this year, otherwise there would have been yet another huge (nigh on £1/2m) loss before tax on this company.
A point I've not really picked up on before is that equipment is being depreciated at just 10% pa, which gives an inflated balance sheet and reduces apparent losses. An old trick to present better figures than reality. Most equipment gets written off over no more than 4 or 5 years these days, unless it is something particular which has a known lifespan.
The balance sheet now shows a huge deficit of more than £1.2m, and current liabilities are saved only by virute of the bank loan refinancing resulting in a significant element of the remaining bank loan becoming due in over 12 months, making the position look better than it really is.
Overall, there is little commercial reality in the balance sheet, to which every possible effort has been made to make it look better than it really is.
In essence, without Firoka Group propping up this company, like the bar props up the drunk, Stadco would have gone to the wall long ago.
If I was Kelvin, I would be sticking in a bid of £2m (free of debt to Firoka) just to see if Kassam has had enough.
Almost forgot - thanks to Mark for the pdf of the accounts.