Tranche 2 & the Preservation of Power

[Woodstock Jag]

The Club will be publishing some comms on this in the next few days, as will the Trustees.

It's taken longer than anticipated precisely because the Trustees have been scrutinising the detail of the proposal prior to anything being presented to the fans.

Have a great rest of weekend everyone.

[Jordanhill Jag]

11 minutes ago, Woodstock Jag said:

The Club will be publishing some comms on this in the next few days, as will the Trustees.

It's taken longer than anticipated precisely because the Trustees have been scrutinising the detail of the proposal prior to anything being presented to the fans.

Have a great rest of weekend everyone.

So in short TJF are doing the scrutinising of the Share Sale - and its terms - not doing due diligence on Club Finances that has led us to continuing large losses and £200k in Cash Reserves being spent in one Season 

There will be No EGM - there will be no detailed finances that allows challenge in a Formal Setting of the Financial Management that continues to not get Control of Running a sustainable business 

there will be a statement from the Club who are pushing for Tranche 2

TJF will not challenge it - after all there Rep on the Board made it quite clear that he couldn't see why any Jags Fan wont not want Tranche 2 and he is a “ time served accountant” 

As originally stated its a done deal - the only challenge  is how to sell it without looking bad that TJF are supporting a Club Policy is to run up unsustainable debts funded by selling off Assets

“Nothing to see here - move along please” 

apart from - what do you do when you spend Tranche 2 ? 

 

[Bobbyhouston]

On 11/8/2024 at 12:02 PM, Jordanhill Jag said:

So it’s gone quiet on Tranche 2 Cash Injection – despite a 2000 Word Statement from the Club Board saying how much it was needed – and there is a reason for the Silence.

But First lets look at the Club Finances as they stand – and for the avoidance of doubt – the numbers I’m about to state are from the Club - via AGM & various Financial Statements – this is important – as there are lots of “half truths” being used to justify our perilous finances  – The Club has a Fiduciary Duty that its Financial Statements are accurate – therefore figures quoted are from the Club – not “those in the know”   

There is much talk of “inherited debt “ from the previous Board – and that’s the justification for the Finances being in a poor state.  

Ok - so the stated figure ( at the last AGM ) was that around Jan 2023 a “Shortfall” of circa £600K was identified – since then various people have attempted to say it was £700K then £800K – it wasn’t – the £600K figure was advised by the Club at the AGM

By the end of Season 22/23 this “Shortfall” was reduced to £350K losses due to the Rangers Game Income in February 2023 – Now there is talk of £100K for Youth Apprenticeship & Women’s Team Funding as part of “inherited debt”

That’s simply untrue – there were costs no longer funded by Thistle Weir going into 23/24 Season – they were known & factored into that Seasons Budget

Same applied to Stadium Repairs – they were known-  including long term Large Capital Expenditure – allowances are made in the Budgeting ( let is not forget that for most of 23/24 & currently- we have had Two Qualified Accountants on our Board ) So there is no reason for Finances & Budgets not to be accurate.

Now the £350K debt goes into Season 23/24 -as it still needs to be paid – however  September of 2023 – the Tranche 1 Investment from Donald Mclymont cleared this debt - and left £280K of Cash Reserves

So we are very very clear - early in Season 23/24 - all of the previous Boards Debts were wiped off - and we were £280K Positive in Cash Terms – a very very strong position to be in financially -for any Championship Club

Now in Season 23/24 – the Board advised the following compared to Season 22/23 –

Football Budget was roughly the same in both Seasons

Gate & Commercial Revenue was up by circa £200K

Income from TJF + other sources was + £120K

So that’s an increase in income of + £320K for Season 23/24

Now deducted from that is (-) £100K of Costs for Youth Apprenticeship / Woman’s Team Funding  - no longer funded by Thistle Weir ( worth noting the Club does not fund our Youth Academy-  unlike all other Scottish Clubs )   

So overall comparable income is up £220K Season on Season

We are forecasting a loss of £150K for Season 23/24

Now previous Two Seasons under the Old Board losses were circa £300K each Season

So the figures seem stack up – additional £220K Revenue has reduced losses to £150K compared to £300K previously

But for one small detail – we also spent £200K in Cash Reserves in Season 23/24

So the losses are actually around £350K ( despite £220K of additional income ?)

The forecast losses Season 24/25 are £260K

Total losses over Two Seasons = £600K

These are identical losses from the previous Board which had mass protests & demands they resign ?

Now Tranche 2 is a defacto “ done deal” the only slight delay is how to get it across the line – it should be an EGM - with detailed figures justifying selling off another 10% of the Club 12 Months after the first Sale of 10%

But an EGM has close scrutiny on the 10% sell off – too much detail – too many questions

Tranche 2 will be shuffled onto the AGM – the reason is very simple – the published Club accounts give very little info to do an analysis – the Board present the more detailed numbers they want us to see them - on the night – with very little time to question them

Our New Chairman stated that the reason that he didn’t do due diligence on the Accounts before he accepted the shares from the Old Board was that there wasn’t enough info in the published accounts – and he is right – there will be No possibility of Due Diligence on Tranche 2 Share Sell Off    ( remember “Due Diligence”  used to be a thing for TJF ? – how times have changed ) 

Now TJF have said they will “consult” there members – however the TJF Club Board Rep who has advised that he is a “time served accountant “ has already stated that he cannot see why any Jags Fan would not want Tranche 2 ?

Rather than a Vote – Rather than a debate- allowing two sides of the argument-  TJF will do a “survey” the reason is simple – people pay less attention to a survey than they do a Vote ,in addition - a Vote would have to include eligible stakeholders who may not be in TJF ( same as the Fan Elections to the Board ie Season Ticket Holders  ) – so “Consultation”  is simply Window Dressing

So what is Tranche 2 actually for ?

There has been a vague list – Roof Repairs – More Staff - £100K on unspecified Fan Project – restore Cash Reserves ( with No explanation on how they burnt through £200K of Cash Reserves last Season ) - it was all the previous Board - a Big Boy did it and ran away  

The real requirement for Tranche 2 is to preserve the Status Quo – we have £260K forecast losses - £75K of Cash Reserves – at some point we run out of cash due to the losses ( without Tranche 2 )  – then we are back to where we were under the previous Board & the current cosy Board / TJF Set up implodes

Tranche 2 kicks that scenario down the Track ( it doesn’t resolve the problem ) it simply allows The Board & TJF to stay in Power a bit longer – hoping we get promotion before the additional cash runs out      

So the reality is very simple – Donald Mclymont has offered the Club another £500K in Tranche 2 – I don’t know him – never communicated with him – I'm sure his intentions are honourable

However – if he doesn’t demand radical change at Board Level & how the Club is run - as part of Tranche 2 – he has a duty of care to confirm in advance- that he will step up with a Tranche 3-  when Tranche 2 Runs out ( as it will ) – it’s on him – he calls the shots on finances

Without a commitment to Tranche 3 – it puts the Club at risk ref our future Finances – our Cash Burn – Losses etc will eat up Tranche 2 very Quickly & then what is the Plan ?

Tranche 2 £500K – that’s already down to £240K - based on this Years forecast losses of £260K - before its even received ? ( in addition there is no allowance in any budgets for major Stadium Repairs as confirmed by Tranche 2 being needed for the JHS Roof)  

The Board Forecasted a breakeven for Season 24/25 last December at the AGM – within circa 8 Months-  that was then restated as a Forecasted £260K Loss – with budgeting like that -how long will the remaining £240K from Tranche 2 last ?

Those involved in fighting for TJF to get Control of the Club Shares all publicly stated there 100% belief in ensuring we did not put the Club in Financial Jeopardy – they got support on that basis – but it would seem racking up large losses are OK-  as long as its done by the “right” people   

“Cry havoc and let slip the dogs of the TJF”

  '

 

mibees an idea to get a dug to take out son FFS 

[Jordanhill Jag]

1 hour ago, Bobbyhouston said:

mibees an idea to get a dug to take out son FFS 

Son ? Really ? 
 

if you dont like the posts or the thread - simply read something else ? 
 

But when TJF were putting out Financial Statements going through the last Boards Debt levels - did you make similar comments - if you didn't then I suggest you refrain about making comments for me doing similar  

Or are you in the same mould as TJF large unfunded debts are ok as long as its the “ right people” who are in charge ? 

 

[Bobbyhouston]

6 hours ago, Jordanhill Jag said:

Son ? Really ? 
 

if you dont like the posts or the thread - simply read something else ? 
 

But when TJF were putting out Financial Statements going through the last Boards Debt levels - did you make similar comments - if you didn't then I suggest you refrain about making comments for me doing similar  

Or are you in the same mould as TJF large unfunded debts are ok as long as its the “ right people” who are in charge ? 

 

TJF will be the demise of the club , it’s all about a day out at the game with Nigel, Spencer and Beatrice types  

certainly not a fan of TJF in any way shape or form 

[elevenone]

from club today.  

https://ptfc.co.uk/ptfc-news/proposed-tranche-2-investment-an-overview/

will need to look over a few times but reading between the lines would it be fair to say a decent scottish cup draw would be helpful again this season?

[Jag]

On 11/9/2024 at 10:40 AM, Lenziejag said:

What lesson was learned then and previously ? At times of real financial peril, the fans put their hands in their pockets. What is the price of not trying to compete ? Pretty sure the fan owners are happy if they own 51% of the shares or whatever % gives you controlling interest.

 

The club said on several occasions that the plan was to live within our means. Everybody wants the team to compete - obviously. However, this can still be done without spending way more money than you bring in then asking fans to bail the club out - again.

Fans already put their hands in their pockets through TJF. This was never the case before. You want us to be run inefficiently and just ask fans to dig deeper again when it goes tits up?

Also, what happens when the shares drop below 51% - if current arrangements continue? Will fans still be happy then?

I want Thistle to compete. I also still want to have a club to support in the future.

[ChiThistle]

The most interesting point from the statement is that Tranche 2 isn’t just Donald McClymont.  The 500k comes from 7 different individuals, all putting in a minimum of 50k.

My main question is - what’s the motivation of the 6 who aren’t McClymont?  Football investment isn’t one where you get your money back.

[jagfox]

 Venture Capitalists give me the heebee jeebies. Reminds me of the Barnsley offer which took is down the road to fan ownership in the first place.

[jagfox]

RE: Tranche 1 - "We have also increased the budget available to The Partick Thistle Women’s Team and safeguarded the future of The Partick Thistle Youth Academy."

I don't recall this part and it wasn't in the linked article to Tranche 1. How much of the initial £500,000 went to these parts of the club?

I believed PTFC Women were self-funded with a small donation from the TJF donations?

How much does the Academy currently cost? Again I believe there is a larger donation from TJF donations but a larger amount.

[javeajag]

1 hour ago, Jag said:

The club said on several occasions that the plan was to live within our means. Everybody wants the team to compete - obviously. However, this can still be done without spending way more money than you bring in then asking fans to bail the club out - again.

Fans already put their hands in their pockets through TJF. This was never the case before. You want us to be run inefficiently and just ask fans to dig deeper again when it goes tits up?

Also, what happens when the shares drop below 51% - if current arrangements continue? Will fans still be happy then?

I want Thistle to compete. I also still want to have a club to support in the future.

The fans share cannot go below 51%.

[javeajag]

53 minutes ago, ChiThistle said:

The most interesting point from the statement is that Tranche 2 isn’t just Donald McClymont.  The 500k comes from 7 different individuals, all putting in a minimum of 50k.

My main question is - what’s the motivation of the 6 who aren’t McClymont?  Football investment isn’t one where you get your money back.

This is a fair observation and should have been addressed directly in the statement. 

one assumes these are friends or acquaintances of Donald Mcclymont but that should be addressed along with why they are investing.

pretty basic stuff not to address.

[Big Col]

Venture capitalists always want a return on their investments. Football clubs traditionally don’t provide shareholders with any return or profit on their investments.

Questions about their motives should be asked, rather than the proposal just meekly waved through by the so called fan’s representatives. 

[partickthedog]

The article does include one mention of "Trance 2". A Freudian slip?

[jagfox]

5 minutes ago, partickthedog said:

The article does include one mention of "Trance 2". A Freudian slip?

Maybe hoping for little opposition in getting this passed by the fans.

[jagfox]

19 minutes ago, Big Col said:

Venture capitalists always want a return on their investments. Football clubs traditionally don’t provide shareholders with any return or profit on their investments.

Questions about their motives should be asked, rather than the proposal just meekly waved through by the so called fan’s representatives. 

Agree with this. On reading some Googled information the investors have all worked in the semi-conductor or technology sectors. The venture capitalists seem to be in the sphere of investing in new-start companies in that field.

I'm not overly worried about their motives but I would want to know what they are. 

I don't think they'll be in it for the returns on their investments anyway.

[Woodstock Jag]

Evening folks:

If you keep an eye on TJF's website and (if you are a beneficiary) on your email inbox, there will be a further piece of comms from the Trustees.

Once that's out, we'll be happy to answer any questions you have about the proposal (so far as we are best placed to do so).

There will also be the opportunity to ask questions directly to the Club Board (including Donald) on Friday 29th November.

For those unable to make that town-hall-style meeting, we've also asked the Club (Trustees were literally just off a call with the Club Board now) to allow questions to be submitted in advance (like the last Q&A event). I understand they'll arrange for that to happen.

[Jordanhill Jag]

1 hour ago, javeajag said:

The fans share cannot go below 51%.

The Fans Share can go below 51% if the only options are sell off more Shares or Go Bust ? 

If we have No Cash the Current Strategy is to sell off Shares - if you keep trading at a loss- then you have to continue selling off shares ?   

[javeajag]

22 minutes ago, Jordanhill Jag said:

The Fans Share can go below 51% if the only options are sell off more Shares or Go Bust ? 

If we have No Cash the Current Strategy is to sell off Shares - if you keep trading at a loss- then you have to continue selling off shares ?   

Possibly but that would require the fans to agree and a change to the legal arrangements 

[Jordanhill Jag]

3 hours ago, Jag said:

The club said on several occasions that the plan was to live within our means. Everybody wants the team to compete - obviously. However, this can still be done without spending way more money than you bring in then asking fans to bail the club out - again.

Fans already put their hands in their pockets through TJF. This was never the case before. You want us to be run inefficiently and just ask fans to dig deeper again when it goes tits up?

Also, what happens when the shares drop below 51% - if current arrangements continue? Will fans still be happy then?

I want Thistle to compete. I also still want to have a club to support in the future.

I will repeat some Key Figures from my Original Post 

income was up £220K 23/24 Season compared to Season 22/23

We had £280K of Cash Reserves AFTER we paid of the Residual Debts from the previous Season - WE WERE IN THE BLACK CASH WISE   

But we managed to burn through £200K of Cash Reserves - despite Revenue being up £220K ( this includes making allowance of £100K for Apprenticeship Scheme and Woman's Team-  as per the figures advised in the Club Financial Statement in August) The Youth Academy is funded by sources outwith PTFC 

So that £200K additional Revenue + £200K of Cash Reserves ( £400K Spent ) and yet we are still forecasting a loss of £170K 

Now todays statement gives NO explanation as to how we burnt through that level of Cash 

With Tranche 2 they are Forecasting we will have £400K Cash at the End of the Season 

But the same Board last December Forecasted this Season would be Break Even - 8 Months later they Forecasted a £260K Loss - so forgive me if I take any "forecasts" with a large pinch of Salt - even TJF said it was "Pie in the Sky" 

Now for me the most worrying aspect is the complete and utter lack of any Plan to get us to a Breakeven Scenario 

Last Years AGM there was talk of "maximising Hospitality Spaces" - at the Club Q&A a Couple of Months ago it was " better Commercial Contracts" 

Now the Cunning Plan as of today is 

"Beyond this season it is our aim to run the club as close to breaking even as possible over a three-year rolling period. The years where we benefit from player sales and good on-field performance will compensate financially for other years where losses are made due to underperformance on the pitch." 

  We have been in the Playoffs Three Seasons in a Row - outwith Promotion - these are High Income earning Years - but we still rack up massive losses - Player Sales ? is that it - is that the Plan ?    

Tranche 2 will get swallowed up very quickly - now I have stated we require an upfront agreement  that there will be a Tranche 3 - as we will need it 

And I state this with No disrespect to Donald Mclymont - as he has given us a lot of Cash 

Given the second Tranche is spread over multiple investors - there is no guarantee of a Tranche 3 ( even if we want to sell off more Share we need a willing Buyer)

As I stated previously - Tranche 2 is simply to preserve the Status Quo for the Board & TJF - THERE IS NO PLAN 

Todays statement simply confirmed what I've being saying for Months 

But its a done deal - Consultation etc etc is Window Dressing - Fans will Vote it though because without it we could go bust - TJF will support the Board and the Financial Black Hole gets kicked down the Road a bit 

    

 

 

[Jordanhill Jag]

5 minutes ago, javeajag said:

Possibly but that would require the fans to agree and a change to the legal arrangements 

If the options are agree or go bust - they will agree 

The only way of preventing it is to run at a Breakeven & for that you would need a very different set up on Multi Levels running the Club   

[Jordanhill Jag]

This is from TJF Statement on the Finances from the previous Board AGM  - who resigned en masse after Protests etc  

"our main cause for concern is that the Club ran at an operating loss of £215K in the 2021-22 Financial Year and saw its cash reserves reduced substantially from over £620K to just over £330K.This is the lowest Year End Cash balance for the Club Since 2016"   

Now compare this to our current forecasts as things stand   

"This situation would mean that we would have negative working capital of around £250,000 at the end of the year, meaning that we would owe others £250,000 more than we have available to us to meet our debts."

Now the previous Board were ousted for having Cash Reserves at the end of 21/22 of £330K - our current forecast at the end of this Season is zero cash reserves - that's correct zero 

How is it remotely possible for TJF to continue allowing this to happen - they promised Financial Stability - we are in the same loop as before 

If they support this Tranche 2 - without making changes on the Board - they should be taking a long look at themselves in the Mirror 

 

 

 

[Lenziejag]

3 hours ago, Jag said:

The club said on several occasions that the plan was to live within our means. Everybody wants the team to compete - obviously. However, this can still be done without spending way more money than you bring in then asking fans to bail the club out - again.

Fans already put their hands in their pockets through TJF. This was never the case before. You want us to be run inefficiently and just ask fans to dig deeper again when it goes tits up?

Also, what happens when the shares drop below 51% - if current arrangements continue? Will fans still be happy then?

I want Thistle to compete. I also still want to have a club to support in the future.

. I seem to remember last year as each club issued their results each one were reporting losses of £200K or £300K, while the promoted club for about the last 10 years has reported losses of near £1M or more. So, it seems that Championship clubs can’t run at breakeven and hope to stay in the league. 
I am not sure whether the fans will be happy if the shares drop below 51%. We will only find out how much the fans care who owns the club when/if it comes to a vote.

[Jordanhill Jag]

6 minutes ago, Lenziejag said:

. I seem to remember last year as each club issued their results each one were reporting losses of £200K or £300K, while the promoted club for about the last 10 years has reported losses of near £1M or more. So, it seems that Championship clubs can’t run at breakeven and hope to stay in the league. 
I am not sure whether the fans will be happy if the shares drop below 51%. We will only find out how much the fans care who owns the club when/if it comes to a vote.

That assumes you have a way of financing the debt - without Tranche 2 - we don't - plus if we need a Tranche 3 ( which we will very soon ) 

where is the Money going to come from 

this has zero to do with % ownership - this is who is willing to underwrite our losses long term 

[Jordanhill Jag]

How do we know that we need to make changes on the Board ? 
 

Its very simple 

There statement that if the Cash Reserves fall below a certain level -that they will consult the Trusts- is breathtaking arrogance 

At no point do they actually consider that if we run up losses and deplete cash reserves -that they are responsible and they resign 

As long as the Trust back them -there is no concept of accepting responsibility ( and the Trusts have shown they will back them no matter what )