RAISING FINANCE
Financial modelling to facilitate renegotiation of finance facilities, Coventry Construction Limited (CovCon)
CovCon is a subcontractor to the construction industry delivering bespoke steel solutions throughout the UK. Projects tend to be lengthy and CovCon often accommodates unforeseen delays and large swings in working capital.
Joe Aldersley, managing director of CovCon approached me to help forecast cash flow in advance of a negotiation with their bank to renew facilities.
I spent time with senior management to understand the business and translated this understanding into a series of assumptions which I used to build an integrated profit and loss account, cash flow and balance sheet. With this tool, I was able to support Joe and his team and CovCon’s accountants to renegotiate a new and appropriate financing package with their incumbent bank.
Joe said, “With the help of Jon, we were successful in renewing and increasing our banking facilities and also investigating other alternatives.”
Expansion of the site, buildings and operations, Dales Bike Centre Limited
Dales Bike Centre is a destination bike hire centre and cafe located in the heart of Swaledale in the Yorkshire Dales National Park. Demand for its services have been strong for a number of years and for owners Stu and Brenda Price expansion of the site to include a large cafe, new bike hire facilities, car park and accommodation was a natural development. With planning permission obtained, approval of the Yorkshire Dales National Park and a grant from the Rural Development Programme for England additional funding was sought to raise necessary funds to make the project happen.
After being knocked back by several banks in the summer of 2019 I offered to help. I worked alongside Stu and Brenda to produce robust financial information and to explore various options of finance. All of this has happened whilst facing the challenges of Covid including prolonged periods when the business had to be closed. They successfully adapted their business model to ensure they could operate effectively to meet the demand from customers.
Changes were made to the original proposals including the deferment of the accommodation phase of the project. The first phase of the development, involving the groundworks, car park, cafe and bike hire facilities was completed in Autumn 2022 supported with significant funding from the Business Enterprise Fund.
Brenda said, "Jon came to work with us on our ambitious project at a point where, as a small busy business, we were unable to progress any further. Jon brought time, energy and expertise and was able to draw together and present financial modelling that gave us the credibility to approach financial institutions with a professionally thought through and expertly presented plan. Jon was thorough and persistent at seeking the finance we needed, exploring a variety of options.
Working with Jon has been fantastic. His dedication, patience and encouragement have been unwavering despite the various setbacks along the way. Without Jon’s focussed work we wouldn’t be seeing the project and building work progress on the ground as we are today.”
BUY SIDE ADVICE AND SUPPORT
Management buyout, The Orange Partnership Limited
Darren Ward is one of two founding partners of The Orange Partnership Limited who are chartered accountants providing cost assurance on major open book contracts.
Darren’s co-founder was contemplating retirement and was keen to seek an exit from the business. Darren approached me to help him structure a deal that would enable him to buy out his existing partner, increase the shareholding of another of his partners and ensure there was sufficient working capital to enable to the successful development of the business.
Darren said, “Jon has the experience to work out what needs to be done and how to do it. He built a simple financial model to confirm that the deal structure I had in my mind would work. I am busy running the business day to day so having Jon look at what I wanted to achieve with a fresh pair of eyes was invaluable."
SELL SIDE ADVICE AND SUPPORT
Sale, The Natural Childcare Company Limited
The Natural Childcare Company provides day care nursery provision from two sites in Warwickshire.
Owners of The Natural Childcare Company, Katie and Tim Landreth, had been approached by Cresswell Nurseries who had made them an attractive offer for the business. They were happy with the strategic fit of their business with Creswell’s and with the offer on the table. They did not intend to market the business for sale.
“Making the decision to sell our business was one of the hardest things that we have had to do. We anticipated it would be challenging and emotional, so we wanted to make sure we got help from advisers with experience, who we could trust and who would be there for us at critical times.
Jon gave us pragmatic, reassuring advice throughout the sale. He helped us get comfortable with what to expect during the process, provided us with a realistic view on value and was always available to guide us calmly through the challenging times of which there were several!”
Katie and Tim Landreth, Founders of The Natural Childcare Company
STRATEGIC SUPPORT
Analysis of financial information to enable the business owners to make strategic decisions, Warwickshire Gelato Limited
Warwickshire Gelato makes authentic gelato from its manufacturing facility in South Warwickshire. It supplies to the trade but also to the public as “Swirls” via several retail outlets which it owns in and around Leamington Spa. The business is owned by Mark and Clair Edwards.
Mark had been manufacturing gelato above one of the retail outlets in Leamington Spa. However, success meant the business had outgrown its existing manufacturing facility and a change was required to enable the business to meet current and future demand.
Mark had options and approached me to help him appraise these options. I spent time with Mark to understand how the existing business operated and by applying financial modelling I was able to help him better understand the existing business and appraise each of his options. The business relocated to a new manufacturing facility and is now operating on a more sustainable basis, supplying its retail outlets and an increasing number of wholesale customers.
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Mark said, "As a small family business from time to time you miss the interaction with fellow directors that you benefited from when working in a corporate environment. Therefore, working with Jonny, it was a positive process to discuss our historical growth and future ambitions, balancing the emotional and financial options. Jonny presented the numbers and gave an unbiased review to enable us to make an informed decision. Jonny has patience and great empathy, enabling him to understand that he was advising someone who is absorbed in the day to day workload by being flexible.
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In our new location we have developed a new range of retail products and been approached to supply new clients plus we will benefit from winning a Coventry & Warwickshire Foodie Award."