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Tangible Fixed Assets anyone?

Hotel Joint Venture

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[quote user="lappinitup"]

[quote user="crafty canary"]Is there any part of it that you think is completely wrong, given it''s an estimation?[/quote]I have no idea whether those figures are right or wrong. Have you? I''m simply pointing out that fag packet accountancy is mostly guesswork and yet, in most cases, is presented as fact.

Now, I''m glad you dropped in Crafty, reminded me that Big Brother is on tonight! [;)]

[/quote]Just fed up with people who have nothing constructive to add to a debate and are just massaging their egos.

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[quote user="crafty canary"]Just fed up with people who have nothing constructive to add to a debate and are just massaging their egos.
[/quote]The debate is quite simple crafty even if you can''t understand it. Tangy has bumped this thread up which he started in January as if his figures are factual. However, if you take a closer look at his estimates, they tend to provide more questions than answers. For example he says........

"Assume £100 per room net of costs --> 25 rooms occupied per day on average."

And from the same post........

" So can they triple the occupancy rate?

So Tangy is suggesting out of 150 rooms only an average of 25 are being let on a daily basis implying the hotel is very quiet. Yet, if you read Gazza''s post on the first page of this thread (who lives opposite) you get a totally different picture........

"I can tell you it''s as busy as an city hotel could expect to be, traffic at all hours, coaches continually coming and going picking up and dropping off parties. Added to that are taxis ferrying business types all the while. So I would say they are more than happy with their occupancy (and they must love the custom pre match). In fact it never appears to be shut!!"

That suggests to me that Tangy''s guestimates are somewhat flawed and I still stand by my original point that to take one figure from the NCFC accounts and to guess the rest of the details is unreliable and misleading. I feel sure Tangy will prove me wrong.

Now crafty, can you point me to your constructive post is on this thread? Is it the one where you accuse me of "bitching" or the one where I''m "massaging my ego"? Perhaps you should unite with you brother a bit more and call me names too!

Do you think the Hotel is busy crafty?

 


 

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[quote user="lappinitup"]

"I can tell you it''s as busy as an city hotel could expect to be, traffic at all hours, coaches continually coming and going picking up and dropping off parties. Added to that are taxis ferrying business types all the while. So I would say they are more than happy with their occupancy (and they must love the custom pre match). In fact it never appears to be shut!!"

[/quote]

Capt. Ludd,

Its not shut because its a hotel!

"I can tell you it''s as busy as a city hotel could expect to be..."  Which means exactly what?  Moreover what time period are your referring to? The occupancy may have gone up since the last published NCFC Accounts to 31st May 2009.

Of course when I posted the following: "Assume £100 per room net of costs --> 25 rooms occupied per day on average." It does assume that the reader is capable of realising that 25 x £100 is the same as 50 x £50 per room net of costs. Many hotels do offer discounts and I wouldn''t be surprised that the Hotel at Carrow Rd. does the same in the current economic climate. However the underlying point is the same, i.e., based on the data to the 31st May 2009, they need more revenue, either by increasing the occupancy rate, the average room rate being paid or both in order for it to become a very valuable asset free of debt.

BTW. the name Capt. Ludd relates to your posting behaviour  over along time period on this bb. I let you research who Capt. Ludd was.

 

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[quote]BTW. the name Capt. Ludd relates to your posting behaviour  over along

time period on this bb. I let you research who Capt. Ludd was.[/quote]If you have to explain a nickname, chances are it won''t stick.

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[quote user="blahblahblah"][quote]BTW. the name Capt. Ludd relates to your posting behaviour  over along time period on this bb. I let you research who Capt. Ludd was.[/quote]

If you have to explain a nickname, chances are it won''t stick.
[/quote]

The explanation was for Capt. Ludd''s benefit, I suspect others have realised what it relates to.

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[quote user="Tangible Fixed Assets anyone"]

[quote user="blahblahblah"][quote]BTW. the name Capt. Ludd relates to your posting behaviour  over along time period on this bb. I let you research who Capt. Ludd was.[/quote]If you have to explain a nickname, chances are it won''t stick.[/quote]

The explanation was for Capt. Ludd''s benefit, I suspect others have realised what it relates to.

[/quote]I''d be happy to put it to a show of hands, as I have no idea who he is.

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[quote user="Tangible Fixed Assets anyone"]Capt. Ludd,

Its not shut because its a hotel!

"I can tell you it''s as busy as a city hotel could expect to be..."  Which means exactly what?  Moreover what time period are your referring to? The occupancy may have gone up since the last published NCFC Accounts to 31st May 2009.

Of course when I posted the following: "Assume £100 per room net of costs --> 25 rooms occupied per day on average." It does assume that the reader is capable of realising that 25 x £100 is the same as 50 x £50 per room net of costs. Many hotels do offer discounts and I wouldn''t be surprised that the Hotel at Carrow Rd. does the same in the current economic climate. However the underlying point is the same, i.e., based on the data to the 31st May 2009, they need more revenue, either by increasing the occupancy rate, the average room rate being paid or both in order for it to become a very valuable asset free of debt.

BTW. the name Capt. Ludd relates to your posting behaviour  over along time period on this bb. I let you research who Capt. Ludd was.[/quote]Tangy, please read my post again because the quote you are attributing to me was actually posted by Gazzathegreat!

Anyway, good to see that after all those guesses, estimations, assumptions etc., you came to the conclusion that "they need more revenue".  Whoever would have thought that? (Even if every single business in the land would tell you exactly the same thing).

Perhaps you should stick to filling in form 288-b! [;)][:D]

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Tangible Fixed Assets anyone?

Generate £702k per year for say 6 years and they will have enough money for a refurb and clear most of NCFCs share of the hotel related debt.  So can they triple the occupancy rate?

So to answer Nutty, it will be a good asset providing they can get the occupancy rate significantly up.

 

 

Capt. Ludd,

Well the above shows the context of why the extra revenue would come in handy. Happy now?

 

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[quote user="Tangible Fixed Assets anyone"]Tangible Fixed Assets anyone?

Generate £702k per year for say 6 years and they will have enough money for a refurb and clear most of NCFCs share of the hotel related debt.  So can they triple the occupancy rate?

So to answer Nutty, it will be a good asset providing they can get the occupancy rate significantly up.

Capt. Ludd,

Well the above shows the context of why the extra revenue would come in handy. Happy now?[/quote]You''re the expert Tangy. How do they triple the occupancy rate? If you know, will you offer your services to the club? [:^)]

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Just to add fuel to the accountants fire:

1.   On the up side generally most property companies where refurbishment is a regular feature of the business will set up a reserve for life cycle costs.  That is they will put a bit of the profits away each year to build up a cash reserve equivalent to the rough cost of a complete refurbishment.  Thus the net profits discussed above are probably after providing for the refurbishment costs, so that should be built into the calculations as a bully bonus and the cost of refurbishment itself should be ignored.

2.  On the bad side, whenever we stay there we book through a corporate booking agent, and the rates we get are less than half the advertised room rates.  This will extend across most of "Gazza''s" reported business.  So that needs fitting in to any fag packet calculations.  It wouldn''t surprise me, having witnessed it first hand, that match days are by far and away the most profitable days for the hotel. 

Still if it is profitable overall, with depreciation and life cycle reserves created, cash generation should be quite good. 

Away now.

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Shefcanary,

Any idea what a hotel like the Holliday Inn would cost to refurb?

When they get the average equivalent of 75 rooms @ £100 (so it could be 100 rooms @£75 etc.) per day then it really will be  a good earner.

BTW. the net profit is after charging depreciation (which in  a sense the reserve for replacement) in the Profit and Loss Account. However the addition to the cash reserve you refer to may not be the same figure as the depreciation figure.

 

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But Tangie.....

Say we sell our conference facilities 20 times during the year because those takers could also use the hotel. And what if the hotel brought us 20 more sales of conference facilities because their guests needed them. How do you account for those benefits on your fag packet[:^)]

 

 

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