Lambert Smith Hampton Asset Based Lending

Our work - 13/09/2019

Appraisal of inventory to support a revolving loan

Instructed by a Major ABL

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The Brief

  • Instructed by a Major ABL
  • To provide an appraisal of the inventory to support a revolving loan.
  • To support a financing facility to provide on-going working capital

Logistics

  • A group of companies specialising in lead and copper-based metals that undertakes reprocessing of scrap material into building products and specialist manufactured goods located in UK, Ireland and Netherlands
  • Standard cost is frequently adopted for inventory of a commodity nature, so it is important to understand how this varies against current actual cost.
  • The valuation is underpinned by commodity prices of the relevant metals, requiring analysis to identify the elemental composition as well as anticipated sales value and forecast demand.

Resolution

  • Report recommendations included discussion on the optimum method to measure the valuation against commodity prices on an on-going basis.

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