We were selected by a UK hotelier to assist with planning their capital budget for the next five years. The company was performing well from a profitability and cash perspective but was uncertain about the right split of leasehold and freehold premises going forward. Equally, the company was unclear as to the level of investment required in the existing buildings and when to undertake that expenditure.
By working closely with the executive board, we were able to create an effective capital budget with quality and assurance measures built in. This enabled the hotelier to understand future expenditures and the effect that planned investment would have on the on-going operational costs of the business.
As part of our work it was also highlighted that one of the firm’s premises in particular was unlikely to be the best use of shareholder’s funds in the longer term. As such we assisted the firm to put a plan in place to divest of that property within a suitable timeframe and at maximum value to the stakeholders.
In undertaking the capital budgeting process Think Assets also assisted the internal finance team to improve their fixed asset recording systems to help safeguard any future loss of tax relief from capital investment.