Lori Wilhelmy appeared as a guest on Cincinnati’s WKRC’s talk radio show Simply Money™.  Simply Money Advisors offer financial advisory services, including financial planning and portfolio management.  Lori’s discussion with hosts Nathan Bachrach and Ed Finke focused on business exit planning and strategy.

To hear the podcasts, please click the links below.

The craft beer industry is rapidly growing, with the number of craft breweries in the United States hitting an all time high of over 6,000 this past year. Brewmaster is a documentary that “tells the story of the rise of craft beer through two young men pursuing their dreams in the world of beer” and has been showing at various Cincinnati theatres this month. Each show is followed by a discussion with one of Cincinnati’s local breweries, including 50 West Brewery, Madtree Brewing Company, and Taft’s Brewing Company. As ComStock Advisors’ Beer, Wine, and Spirits Industry team, Lori Wilhelmy and Amber Widener attended a screening of the documentary as well as an insightful Q&A discussion with Madtree and are excited by the continued growth and involvement of this industry in our community.  The next showing of Brewmaster is Thursday, November 8 at the Esquire Theatre, followed by a Q&A session with Taft’s.

ComStock has longstanding experience in the engagements of breweries and distributors, valuing intangibles for financial reporting purposes as well as valuing equity for ownership succession planning. ComStock is also an allied sponsor of the Ohio Craft Brewers Association, an industry leader in preserving the art of exceptional craft beer.

For more information on the impact of business valuation for breweries, please read Amber Widener’s article “Brewing Value.”

The National Trust Closely-Held Business Association held its annual conference last week in Cleveland, Ohio. Nick Sypniewski, Managing Director of ComStock Advisor’s Cincinnati office, along with other industry experts, participated in an informative valuation roundtable discussion.

Valuation topics relevant to the attending fiduciaries of closely-held businesses included tax law changes, discount methodology, and IRS activity.

The experts noted the effects of the Tax Cuts and Jobs Act on their valuation of closely-held businesses goes beyond just the overall increase in value due to the decrease in the federal tax rate on corporate income. Other issues to consider are the law’s changes to accelerated depreciation and limitations on interest expense deductions, which was noted to have particularly influenced valuations involving private equity which are typically highly-leveraged. The changes in the tax law also need to be considered in the market approach regarding merger and acquisition transactions and the comparability to pricing multiples under the previous law.

Discounts for lack of control and lack of marketability were also discussed. In closely-held business valuations, the dynamics presented in the entity’s operating agreement largely influence the appropriate discounts. Other factors taken into consideration are customer concentration, volatility and industry dynamics. Methods noted by the experts used to quantify discounts were the Stout Restricted Stock Study, closed-end fund data and Partnership Profiles.

Attendees inquired about IRS activity as well. The panelists noted the IRS commonly challenges discounts especially those taken by holding companies.