TACROPOLIS
So, it is about to be admitted by the Board and the Management that the plan to build the TAC MAHAL was actually based on Greek accounting standards and sub-prime CDO morality.
TAC is about to go to the market...which means pick your pockets...with a rights issue...without the rights of course.
Prepare yourselves to be touched up with a Yen 100,000 levy.
This begs the simple question of why you would consider forking over another USD 3 million to an organisation that has consistently failed to exercise fiscal discipline over an extended period of time?
The simple answer, of course, is that you should not, regardless of the consequences.
This would only be delaying the ultimate day of reckoning bearing in mind that USD3m is approximately 5 months of operating deficit at the current rate of cash burn.
posted by Unlock at 9:31 PM
4 Comments:
Details not covered in the President's insight email..
The claim is that TAC is cash positive so what they seem to be saying is that with depreciation commitments of the current temporary facility, the club is very much under water.
There is a claim that staffing has been cut to the bone and it is affecting service. Against this, the number of faces on the staff management list have not changed and that is where the big expenses are.
Obviously between a rock and hard place and banking covenants are a problem.
April 30, 2010
Dear Fellow Members,
As you all know the Club is in the midst of an historic redevelopment project and I am pleased to report that the project is on schedule and on budget and that we will receive the keys to our fabulous new home in December.
While the project is proceeding as expected, the current economic environment has resulted in the Club having significantly fewer members than projected when we embarked on the project. While the Club’s current operational cash flow is positive and above budget, the reduction in Members will have a negative impact on our projected future cash flows. In order to ensure that the Club maintains a positive cash flow and complies with the covenants in our loan agreement, the Board created a Working Group last year to study ways to improve our cash flow and recommend appropriate actions.
The proposed actions were carefully studied by the Working Group over a four-month period and unanimously approved by the Board. The actions represent a balanced approach under which staff, management and Members all contribute to the improvement in our projected future cash flow. The specific actions and their estimated contributions to cash flow in the first year are:
• Steps to recruit additional Members (Yen 262 million)
• Cost reductions and improved operational efficiencies across all departments (Yen 54 million) • Reduction in management compensation and staff benefits (Yen 40 million)
• Reduction in projected staffing levels at the new Club (Yen 221 million)
• A recommendation that Members consider and approve a temporary monthly Special Assessment of ¥9,500 for all dues paying Members and Vacant Company Membership for twelve months commencing 1 March 2011 (Yen 273 million)
• Negotiation with our lender to modify the loan covenants
• A voluntary contribution program that will recognize Members and their companies who donate to the redevelopment project
The Working Group’s full report to the Board is provided on the web at:
http://www.tokyoamericanclub.org/news- a-info/committees-a-management/board-of-governors.html
and upon request at the Member Services Desk.
This includes a FAQ which also covers the Club’s actions to date. These provide support information for the Special General Meeting to be held on June 7, 2010. I strongly urge you to take part in this meeting and support this proposal.
It seems the Working Group report is no longer accessible....
Well it's the all care and no responsibility argument that the Board will come up with...
Lance is certainly well meaning and one has to give him credit for his ...humans are basically good philosophy...but incompetence is incompetence in ay color or creed.
To let the likes of Bummy and Sexton run the agenda is nothing but complete incompetence.
The best thing that could happen to TAc is for it to go bankrupt..only then will something positive hapen.
Well the Town Hall meetings have come and gone with only a hard core of members in attendance. It does seem that burying the announcements during the Golden Week wine tasting announcement has had the desired effect.
There is still a belief that
-revenue enhancement will save the club.
-cost cutting at the margins will suffice.
-lots a prayer will bring divine intervention.
Clearly this is nonsense.
Perhaps the members' best interests would be served by passing the club into private hands. A least then the cost structure could be brought into line with industry standards.
Post a Comment
<< Home