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Hard times for Linn

Perhaps the worksforce will do a Tannoy and step sideways body swerving the overpaid elite and set up something tasty of their own. Arf Arf Audio showing their new LP12.1...

A bit less on R&D and a bit more on ensuring their products were serviceable for a reasonable lifespan. I know someone who ended up with a CD12 shaped brick.
 
tiggers said:
Really? So what do you mean by the below? How is greed and director's salaries related to the R&D invoicing?
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Hi,
I examined the Companies House accounts, and 2019 they paid dividends of £525k, and in 2018 they paid £150k dividends. Dividends are charged at a much lower tax rate than salaries.

In addition, the extra £375k dividends this year has placed the company into debt - not sure if this is the sole reason.

Why pay such a significant rise in dividends, to put the company into debt ?

Are they looking to sell on and take as much out of the company before they sell ?

Or is this the start of bankruptcy ?

Regards,
Shadders.
 
Shadders said:
Hi,
I examined the Companies House accounts, and 2019 they paid dividends of £525k, and in 2018 they paid £150k dividends. Dividends are charged at a much lower tax rate than salaries.

In addition, the extra £375k dividends this year has placed the company into debt - not sure if this is the sole reason.

Why pay such a significant rise in dividends, to put the company into debt ?

Are they looking to sell on and take as much out of the company before they sell ?

Or is this the start of bankruptcy ?

Regards,
Shadders.
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As I said before we don't know without additional information. It could be any of those things or none.

It also doesn't answer my question regarding how greed/directors' salaries are related to R&D invoicing.. assuming there is any R&D invoicing of course.
 
Simples, For example, ‘let’s see if we can fit some Linn gear in a McLaren 620S, we might get a contract. First let’s buy a McLaren 620, oh charge it’s to R&D’ or at least variations on that theme....
 
Martyn Miles said:
Perhaps people aren’t buying ( high priced ) LP12s any more...

What IS Linn’s main market these days ?
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My last LP12 purchase was back in the '90's....it's still here and upgraded..will see me out ...my DS gets a lot more use but there is a much larger digital library available...also reside across the road from Linn HQ ;)
 
Neiro said:
Simples, For example, ‘let’s see if we can fit some Linn gear in a McLaren 620S, we might get a contract. First let’s buy a McLaren 620, oh charge it’s to R&D’ or at least variations on that theme....
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But the McLaren 620S would be a capitalised asset and not eligible for a tax benefit under the R&D tax credits scheme (the post about the accounts stated the £2.4m was a tax benefit so I am assuming it's enhanced expenditure under the R&D tax credits scheme).
 
Sorry I'm not an accountant and I did say variations on that theme. Just illustrating a concept, it may require more imagination. There are clever people who are able to manipulate these things to their advantage.
 
So in short the insinuation is not only unfounded, but also not based upon you having any real knowledge around the process of declaring R&D in company accounts and the R&D tax credits scheme. I'm not an accountant either, but it's pretty basic stuff and I can tell you that if you wanted to 'do something dodgy' R&D is not where you would be doing it... not unless you wanted to get found out!
 
guest said:
Funny how the financing is handled and interpreted elsewhere with a totally different slant:
https://www.insider.co.uk/news/high-spec-hi-fi-maker-19021136

Pick the story that suits.

They should get the Blue Nile back into the studios.
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Hi,
Hmm, the turnover is in decline and the company starts to pay out quite a lot more money to its directors in the form of dividends and loans, putting the company in debt. Is this not odd ?

These events are interesting. No one really bothers examining the accounts unless someone brings up the problem on a forum. How many bosses take this approach - Philip Green, Thomas Cook, Carillion etc ????

Is this the start of the end - where the people at the top extract vast sums, the company gets sold off with the debt against the company not the people ?

Regards,
Shadders.
 
Someone has figured out a way to produce snake oil cheaper. Genetic engineering?. factory farming?. who knows or cares, apart from the poor snakes.
 
Odd that the directors pay is so high, family businesses usually squeeze their cut to leave money for the company
 
davidsrsb said:
Odd that the directors pay is so high, family businesses usually squeeze their cut to leave money for the company
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I work for a firm that used to be family owned. The family took out around £30M before selling it. Just an observation, not suggesting that's the case with Linn.

Directors and accountants often time expenditure to create 'losses' on which tax can be reclaimed, nothing wrong in this just a way of making the most of the system in a year when income may be down anyway. A loss in one year can mean you don't pay tax for a couple of years afterwards.

I was lucky to visit Linn's factory earlier this year on a trip arranged by my local dealer. As well as the excellent hospitality, the tour and demonstrations were a real eye opener. They make everything in house apart from items that would require another whole factory to make. All of the casework right down to the brackets inside that the circuit boards mount on. Personally I think it's taking quality control further than necessary, but I'll bet there's absolutely no variation in performance between tens or hundreds of examples of a product. I believe there is no stock of finished products and everything is built to order, so there's no chance of discounted obsolete models.

While I don't entirely agree with their pricing model, I can see where it is justified by the way they have chosen to make their products. Whether it's strictly necessary to make so much in house is another matter, but seeing the number of rejected items from their suppliers (perfectly ok to my eye but not up to Linn's standards) I think it would take a huge culture shift for them to change this.

The R&D section of the factory is very large in proportion to the rest and would be a fascinating place to work, I quite believe the level of expenditure. Investment in new equipment at the time of my visit did not indicate a business in decline in any way.

Even after the visit I'm not entirely sure where their market lies. They were very supportive of the enthusiasts and making sure that legacy equipment fits in with the new products, however you have to be pretty well off to get on the ladder in the first place. Personally I think there are a lot more very well off semi retired buyers out there than forum members may realise. Whether they will continue to want products that are cutting edge but also designed for such longevity and hand built to boot is another matter.
 
Then ofc, it’s a HiFi system, so for the younger buyer, it may matter that other makers equal the sound quality at a lesser price. This was my earlier point. Linn sound great and are well made, but neither of those values seem high priority for the ‘young’ music lover.
 
Rockmeister said:
Then ofc, it’s a HiFi system, so for the younger buyer, it may matter that other makers equal the sound quality at a lesser price. This was my earlier point. Linn sound great and are well made, but neither of those values seem high priority for the ‘young’ music lover.
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That's the way the whole world has gone, people who buy new stuff don't intend to keep it for long so build quality isn't a major concern. Disposable society.
 
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