Lynton and Barnstaple - Operations and Development

Very many thanks, @Michael B . Did 'James' explain where this money came from? I understood - probably wrongly - that there was a restricted fund for Blackmoor Gate/OSHI?

 

You have said much. I am not a former banker, I live in a much simpler world of wood, chisels and no credit, so I seek a little clarification.
If I were stating similar about the trustees of a similar charity, would I be claiming fraud? or mismanagement? or misrepresentation? Would I be making the claims against the charitable trust as a corporate entity, or the trustees as individuals? What would be the implications if my allegations were incontrovertibly true?

 

No. It must be assumed the £253,000 investment in shares was made in cash, and is shown less a loss the LBBC Company made in 2022 of £825 at a net £252,175 in the list of 'Investments in Subsidiaries' note 17. The LBBC restricted fund is in a separate account; movements in the year are shown in note 21 which had £288,394 in it at 31.12.2022. The £250,000 loan by the Trust to LBBC you have mentioned in a recent post must have been made in the current year as it is not included in the list of debtors in note 18. It is not surprising it is unsecured as the secured loan of £580,000 will have taken it all, so to speak. What concerns me is that this latter loan is repayable at 6 months written notice. Perish the thought, but if this lender dies, there is a possibility, (maybe a probability ?) the Executors would require repayment. As the Trust has already invested over half a million, having to find such a sum would presumably result in it having to borrow a large part of it from somewhere else (albeit with the security released) or raise an emergency appeal, or a combination of both.

The Accountants letter read as follows:

Thank you for your e-mail.

The value of the Trust's investment on the L&B Blackmoor Company Ply is £253,000, being £50,000 A shares and £203,000 B shares.

For the purposes of these accounts, this is not expenditure as investment in the share capital is a capital item (i.e. carried on the balance sheet of the Trust as an asset rather than treated as an expense on the Statement of Financial Activity or Income and Expenditure Account).

The expenditure allocated to the LBBC fund is expenditure of the charity, not the subsidiary, as it relates to the overall project. They are not expenses of the L & B Blackmoor Company itself (e.g. legal costs relating to a check of the articles of association before shares were issued, etc). These are properly costs of the charity relating to the overall project and not the costs of the subsidiary.

I hope this answers your questions.

Kind regards

James

 

The majority of the answers you have given in this post seem to be conjecture gained from ilinformed conversations on this forum. Could you please point out where you have stated hard facts, rather than conspiracy theories?

 

Hi @Ross Buchanan I'm only saying that we should expect the Trustees to be trustworthy.

Unfortunately, what we are finding out now is that the Trust Chairman is actively misrepresenting things and, I hate to say, lying, and that other than Chris, Anne and Mike, the other Trustees are - at best - not stopping him from attempting to mislead us.

That to me should be a resigning matter.

 

@Thomas Woods - actually, this analysis is all from publicly available sources, mostly at Companies House and from statements made by the Trust Board and the Trust Accounts. Such conjecture as there is is down to the lack of transparency (and, frankly, honesty) from leading members of the Trust, notably Peter Miles.

To answer your question, let's start with Old Station House Inn / L&B Blackmoor Company (LBBC).

LBBC:

Shares
Total shares issued- £1,110,983 (See here)
This comprises
- £50,000 of controlling A shares at £1 (the Trust owns all of these)
- £1,060,983 of non-voting B shares at £1 (the Trust owns 203,000 of these, comprising of purchases of £200,000 and of £3,000, for a 22.8% economic stake

Loans
Secured: £580,00 from Mike Grimoldby at 6% which as @Michael B correctly observes, is repayable in full at 6 month's written notice (See here)
Unsecured: £250,000 from the Trust at 5% repayable over 10 years in equal amounts (Source: Newsletter 81 p 8 details the loan, and the rate came from email discussion. It must be unsecured because there is no charge at Companies House).

Trust Exposure to LBBC
Loans - £250,000
Shares - £253,000

Total exposure at least £503,000

OSHI Profitability
So, from this we can see the amount that OSHI will have to make in pre-tax profit this year in order not to default is £72,300. This comprises:

Loan Interest
6% of £580,000 = £34,800
5% of £250,000 = £12,500

Loan Principal Repayment
10% of £250,000 = £25,000

If you wanted to pay off the secured loan in 10 years, you'd add 10% of £580,000 = £58,000.

I hope you can see from this that the last thing this is "conjecture gained from ilinformed conversations on this forum" and it is certainly not "conspiracy theories" - in fact, it is firmly rooted in the "hard facts" you asked for. I hope this helps, pls DM me if you want to discuss further.

 

Thanks @Michael B - very useful. I share your concern about the six months' notice, too - and with a year one bill to avoid default of a pre-tax profit of £72,300, at a post-tax net margin of say 15% (generously), OSHI would need to have turnover of roughly £0.5m to service its debts.

I should stress that I want the OSHI project to succeed, but the amount of debt - presumably driven by the price paid - has imported a very significant amount of financial risk into the Trust (ironically, what LBBC was designed to avoid) and is currently locking up more than £500k of capital when we do not have enough cash to build Bridge 65, let alone extend to Bridge 64 (as the website continues to incorrectly claim.)

 

>>> I hope you can see from this that the last thing this is "conjecture gained from ill-informed conversations on this forum" and it is certainly not "conspiracy theories" - in fact, it is firmly rooted in the "hard facts" you asked for.....[/QUOTE]
I would suggest to @Thomas Woods that a key factor in what he describes as 'ill-informed conversations' arises from the continued failure of the Board to provide timely, accurate and detailed information to the membership about all the various issues which surround the current and future activities on the railway.

Trust members are not stupid - we can put 2 and 2 together and get 4. It is when the answer appears to be 5 that we start to answer questions, and when those question go unanswered one has to ask - why? When they make claims about certain matters, but fail to provide the evidence to support such claims, then again one has to ask - what is going on?

 

Thomas - in response to Tobbes's detailed quantitative assessment you merely offer qualitative platitudes.
For the avoidance of doubt please set out your hard facts and reasoning instead of simply gainsaying.

Sent from my SM-T575 using Tapatalk

 

Nimby-gate I would suggest. They'll be saying the steam blocks out the starlight next.

 

Whilst I appreciate the several areas of concern re the financial details of the OSHI purchase, I also suspect that the people involved were in a very difficult position as they needed to raise a lot of money quite quickly. The site is crucial to the eventual success of a recreated L & B, if it went to an "anti" then we could have had to wait for, possibly, many many years before it came on the market again.
As it is, hopefully the supporters will continue to buy shares (and thus reduce the debt burden)...these shares may even generate a return/dividend - which is very rare in railway preservation finances.
Whatever happens, at least we now have this asset in the L & B ownership and another piece of the jigsaw is obtained.

I also note that the EA is changing its relationship with the Yeo Valley Trust and has a very easy Internet Voting system set up.

 

Haven't seen your apology yet, following the detailed response you were provided with!

 

Somebody will correct me no doubt, but I'm not sure OSHI was ever "on the market". Negotiations - or at least discussions - with the former owners had been in progress for many years. Also, with the planning permission then in force, the actual pub building was not crucial to the railway operation, as the planned route skirts around the building on a slight deviation from the original trackbed.

 

I have heard that the terms of the sale are the subject of a non- disclosure agreement, with heavy penalties for non -respect.

Insisting on, or forcing disclosure could therefore have unintended negative consequences.

 

Not all of us are constantly on line. I agree he should reflect upon his earlier post but since @Thomas Woods only posted it late yesterday it's quite possible he hasn't seen the responses yet.

 

I tried that before posting but it doesn't work for a non-staff member like me since @Thomas Woods "limits who may view their full profile" which presumably also limits what I (but not you) see when I click his name.

 

Quite, which is why I have always viewed the OSHI as a 'nice to have' rather than 'essential'. Provided that we had secured the land required for a new trackbed and platforms, then the acquisition of the actual former station could have been addressed at a later date when there were 'spare' funds. Far more important surely is to get the new Depot built and the bridge under the main road?

 

Im sure when the plans were on display in a marque in the National park carpark opposite OSHI many years ago they originally showed a new Station building that would have been sighted at the bottom of that carpark and that the trackbed would have skirted around the lower side of OSHI

 

So now that we own oshi, why can't the restored railway follow the original route? Why the deviation?
I ask because there is other talk about deviations. To avoid paracombe bank, to visit a little zoo, to get round the reservoir etc. And we should avoid deviations if at all possible.
Ian