Aug 1st, 2017
193 UK golf clubs vulnerable
To hostile take overs
An industry financial analyser has stated that there are 193 golf clubs in the UK that are currently ripe for acquisition, and vulnerable to hostile take over.
The research comes after a number of golf clubs, including Sapey in Worcestershire, The KP in Yorkshire and Witney Lakes Resort in Oxfordshire, have all been sold to large leisure operators.
Plimsoll Publishing has said that the 193 unnamed clubs are currently financially weak but have good gross margins.
“These companies are over stretched and exposed to a hostile takeover,” said senior analyst Christopher Evans.
“The next 12 months will present a rare opportunity to acquire one of a number of clubs for a significant discount.
“New owners could liberate their untapped potential and realise a profitable acquisition.”
Twelve of the 193 clubs are major golf clubs with turnover of more than £5 million per year – and two of them saw turnover of more than £20 million last year, according to the report.
More than half though have turnover of less than £1 million, with 37 less than £500,000.
The 193 clubs were identified after the company assessed 931 companies, and found 377 of them are in ‘financial danger’, with 83 described as ‘serial loss makers that chase sales at any cost’.
Evans stated that average sales growth in the industry is just two per cent, with a profit margin of just one per cent – but for those 83 clubs the average was growth of seven per cent for a profit margin of -18 per cent.
“A core of 83 serial loss makers will have to act more responsibly in 2018 or simply run out of cash,” he added.
So, if you are on the look out to buy yourself a golf club, the timing is looking good.