Company Registration No. 08080734 (England and Wales)
GH LONDON GROUND HANDLING SERVICES LTD
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
GH LONDON GROUND HANDLING SERVICES LTD
COMPANY INFORMATION
Directors
P Zincone
P De Ruggiero
M Tierno
G Carcassa
(Appointed 20 December 2022)
Company number
08080734
Registered office
249 Cranbrook Road
Ilford
England
IG1 4TG
Auditor
Xeinadin Audit Ltd
12 Conqueror Court
Sittingbourne
Kent
ME10 5BH
GH LONDON GROUND HANDLING SERVICES LTD
CONTENTS
Page
Strategic report
1
Directors' report
2 - 3
Directors' responsibilities statement
4
Independent auditor's report
5 - 7
Income statement
8
Statement of comprehensive income
9
Statement of financial position
10
Statement of changes in equity
11
Statement of cash flows
12
Notes to the financial statements
13 - 25
GH LONDON GROUND HANDLING SERVICES LTD
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022
- 1 -

The directors present the strategic report for the year ended 31 December 2022.

Fair review of the business

The company's goal is to build up a growing successful business recognised as valuable and reliable by all stakeholders.

 

The company serviced at London Heathrow 4,323 yearly flight turns compared to 3,338 flights in 2021 (+29.5%) completing a full recovery of the business after the COVID-19 pandemic. Furthermore, due to the high passenger growth at Heathrow airport during 2022, Heathrow Airport Limited moved major GH London clients back to Terminal 4. For this reason, GH London made the decision to keep the operations in the current T2/T3 only to avoid costs duplications following the split of operations in T2 and T4. During this time, GH London also started its services of the new client Iberia at T2.

 

GH London operates at London Luton 17,449 yearly flight turns compared 9,968 turns in 2021 (+75%) reporting a full post pandemic recovery of the business. At the same time, GH London renewed a five year handling contract with Wizz Air at Luton airport.

 

In the year ending 31 December 2022 the actual EBITDA was negative by £1,757,267 (In 2021 - negative by £776,938) and the turnover was 20.3m (2021 - £13.6m, an increase of 49.2%).

 

On behalf of the board

M Tierno
Director
28 September 2023
GH LONDON GROUND HANDLING SERVICES LTD
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022
- 2 -

The directors present their annual report and financial statements for the year ended 31 December 2022.

Principal activities

The principal activity of the company continued to be that of airport ground handling and ticketing services.

Directors

The directors who held office during the year and up to the date of signature of the financial statements were as follows:

P Zincone
P De Ruggiero
M Tierno
G Carcassa
(Appointed 20 December 2022)
Results and dividends

The results for the year are set out on page 8.

No ordinary dividends were paid. The directors do not recommend payment of a final dividend.

Disabled persons

Applications for employment by disabled persons are always fully considered, bearing in mind the aptitudes of the applicant concerned. In the event of members of staff becoming disabled, every effort is made to ensure that their employment within the company continues and that the appropriate training is arranged. It is the policy of the company that the training, career development and promotion of disabled persons should, as far as possible, be identical to that of other employees.

Employee involvement

The company's policy is to consult and discuss with employees, through unions, staff councils and at meetings, matters likely to affect employees' interests.

 

Information about matters of concern to employees is given through information bulletins and reports which seek to achieve a common awareness on the part of all employees of the financial and economic factors affecting the company's performance.

Auditor

The auditor, Xeinadin Audit Ltd, is deemed to be reappointed under section 487(2) of the Companies Act 2006.

Strategic report

The company has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the company's strategic report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the directors' report. It has done so in respect of "Fair review of the business".

Statement of disclosure to auditor

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.

GH LONDON GROUND HANDLING SERVICES LTD
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 3 -
On behalf of the board
M Tierno
Director
28 September 2023
GH LONDON GROUND HANDLING SERVICES LTD
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2022
- 4 -

The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.

 

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:

 

 

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

GH LONDON GROUND HANDLING SERVICES LTD
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF GH LONDON GROUND HANDLING SERVICES LTD
- 5 -
Opinion

We have audited the financial statements of GH London Ground Handling Services Ltd (the 'company') for the year ended 31 December 2022 which comprise the income statement, the statement of comprehensive income, the statement of financial position, the statement of changes in equity, the statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

 

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

 

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Other information

The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

 

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of our audit:

GH LONDON GROUND HANDLING SERVICES LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF GH LONDON GROUND HANDLING SERVICES LTD
- 6 -
Matters on which we are required to report by exception

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.

 

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

 

- Enquiry of management, those charged with governance and the entity’s solicitors (or in-house legal team) around actual and potential litigation and claims.

- Enquiry of entity staff in tax and compliance functions to identify any instances of non-compliance with laws and regulations.

- Reviewing minutes of meetings of those charged with governance.

- Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations.

- Auditing the risk of management override of controls, including through testing journal entries and other adjustments for appropriateness, and evaluating the business rationale of significant transactions outside the normal course of business.

ICAEW guidance relating to reporting on irregularities, November 2020, based on ISA 700 A39-1 to A39-5

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

GH LONDON GROUND HANDLING SERVICES LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF GH LONDON GROUND HANDLING SERVICES LTD
- 7 -

Use of our report

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.

Barry Leibovitch (Senior Statutory Auditor)
For and on behalf of Xeinadin Audit Ltd
29 September 2023
Statutory Auditors
12 Conqueror Court
Sittingbourne
Kent
ME10 5BH
GH LONDON GROUND HANDLING SERVICES LTD
INCOME STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2022
- 8 -
2022
2021
Notes
£
£
Revenue
3
20,397,608
13,636,564
Cost of sales
(19,652,661)
(12,701,454)
Gross profit
744,947
935,110
Administrative expenses
(3,210,589)
(2,660,781)
Other operating income
-
0
35,068
Operating loss
5
(2,465,642)
(1,690,603)
Finance costs
7
(7,823)
(4,819)
Loss before taxation
(2,473,465)
(1,695,422)
Tax on loss
8
459,385
1,986,732
(Loss)/profit for the financial year
(2,014,080)
291,310

The income statement has been prepared on the basis that all operations are continuing operations.

GH LONDON GROUND HANDLING SERVICES LTD
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2022
- 9 -
2022
2021
£
£
(Loss)/profit for the year
(2,014,080)
291,310
Other comprehensive income
-
-
Total comprehensive income for the year
(2,014,080)
291,310
GH LONDON GROUND HANDLING SERVICES LTD
STATEMENT OF FINANCIAL POSITION
AS AT
31 DECEMBER 2022
31 December 2022
- 10 -
2022
2021
Notes
£
£
£
£
Non-current assets
Goodwill
9
-
0
550,367
Property, plant and equipment
10
657,719
786,216
Investments
11
1
1
657,720
1,336,584
Current assets
Trade and other receivables
13
2,992,155
2,604,817
Cash and cash equivalents
852,481
884,644
3,844,636
3,489,461
Current liabilities
14
(7,290,661)
(12,129,080)
Net current liabilities
(3,446,025)
(8,639,619)
Total assets less current liabilities
(2,788,305)
(7,303,035)
Non-current liabilities
15
(7,016,528)
(28,333)
Provisions for liabilities
Deferred tax liability
17
(4,472,585)
(4,013,200)
4,472,585
4,013,200
Net liabilities
(5,332,248)
(3,318,168)
Equity
Called up share capital
19
15,300,000
15,300,000
Retained earnings
(20,632,248)
(18,618,168)
Total equity
(5,332,248)
(3,318,168)
The financial statements were approved by the board of directors and authorised for issue on 28 September 2023 and are signed on its behalf by:
M Tierno
Director
Company Registration No. 08080734
GH LONDON GROUND HANDLING SERVICES LTD
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2022
- 11 -
Share capital
Retained earnings
Total
£
£
£
Balance at 1 January 2021
15,300,000
(18,909,478)
(3,609,478)
Year ended 31 December 2021:
Profit and total comprehensive income for the year
-
291,310
291,310
Balance at 31 December 2021
15,300,000
(18,618,168)
(3,318,168)
Year ended 31 December 2022:
Loss and total comprehensive income for the year
-
(2,014,080)
(2,014,080)
Balance at 31 December 2022
15,300,000
(20,632,248)
(5,332,248)
GH LONDON GROUND HANDLING SERVICES LTD
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2022
- 12 -
2022
2021
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
22
16,975
487,627
Interest paid
(7,823)
(4,819)
Net cash inflow from operating activities
9,152
482,808
Investing activities
Purchase of property, plant and equipment
(29,512)
(43,892)
Proceeds from disposal of property, plant and equipment
-
0
47,500
Net cash (used in)/generated from investing activities
(29,512)
3,608
Financing activities
Payment of finance leases obligations
(11,803)
(57,222)
Net cash used in financing activities
(11,803)
(57,222)
Net (decrease)/increase in cash and cash equivalents
(32,163)
429,194
Cash and cash equivalents at beginning of year
884,644
455,450
Cash and cash equivalents at end of year
852,481
884,644
GH LONDON GROUND HANDLING SERVICES LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
- 13 -
1
Accounting policies
Company information

GH London Ground Handling Services Ltd is a private company limited by shares incorporated in England and Wales. The registered office is 249 Cranbrook Road, Ilford, England, IG1 4TG.

1.1
Accounting convention

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention, [modified to include the revaluation of freehold properties and to include investment properties and certain financial instruments at fair value]. The principal accounting policies adopted are set out below.

The company has not taken advantage of the exemption under section 400 of the Companies Act 2006 not to prepare consolidated accounts. The financial statements present information about the company as an individual entity and not about its group.

1.2
Going concern

Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

1.3
Revenue

Revenue is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.

 

When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income.

Revenue from contracts for the provision of professional services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that it is probable will be recovered.

1.4
Intangible fixed assets - goodwill

Goodwill represents the excess of the cost of acquisition of unincorporated businesses over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is ten years.

 

For the purposes of impairment testing, goodwill is allocated to the cash-generating units expected to benefit from the acquisition. Cash-generating units to which goodwill has been allocated are tested for impairment at least annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit.

GH LONDON GROUND HANDLING SERVICES LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 14 -
1.5
Property, plant and equipment

Property, plant and equipment are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Plant and machinery
10/20% Straight line
Fixtures, fittings & equipment
10% Straight line
Computer equipment
20% Straight line
Motor vehicles
20% Straight line

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.

1.6
Non-current investments

Interests in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.

A subsidiary is an entity controlled by the company. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The company considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.

Entities in which the company has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.

1.7
Impairment of non-current assets

At each reporting period end date, the company reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

GH LONDON GROUND HANDLING SERVICES LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 15 -

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

 

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

 

Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in the profit or loss account, unless the relevant asset is carried in at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

1.8
Cash and cash equivalents

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

1.9
Financial instruments

The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

 

Financial instruments are recognised in the company's statement of financial position when the company becomes party to the contractual provisions of the instrument.

 

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets

Basic financial assets, which include trade and other receivables and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

Other financial assets

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

GH LONDON GROUND HANDLING SERVICES LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 16 -
Impairment of financial assets

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

 

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

 

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

Derecognition of financial assets

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

Classification of financial liabilities

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.

Basic financial liabilities

Basic financial liabilities, including trade and other payables, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

 

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

 

Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade payables are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Other financial liabilities

Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.

 

Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

GH LONDON GROUND HANDLING SERVICES LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 17 -
Derecognition of financial liabilities

Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.

1.10
Equity instruments

Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.

1.11
Derivatives

Derivatives are initially recognised at fair value at the date a derivative contract is entered into and are subsequently remeasured to fair value at each reporting end date. The resulting gain or loss is recognised in profit or loss immediately unless the derivative is designated and effective as a hedging instrument, in which event the timing of the recognition in profit or loss depends on the nature of the hedge relationship.

 

A derivative with a positive fair value is recognised as a financial asset, whereas a derivative with a negative fair value is recognised as a financial liability.

1.12
Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

Current tax

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the income statement because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

 

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the income statement, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

1.13
Employee benefits

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or non-current assets.

 

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

 

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

GH LONDON GROUND HANDLING SERVICES LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 18 -
1.14
Retirement benefits

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

1.15
Leases

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.

 

Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the statement of financial position as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.

1.16
Government grants

Government grants are recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.

1.17
Foreign exchange

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation are included in the income statement for the period.

2
Judgements and key sources of estimation uncertainty

In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

 

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

3
Revenue

An analysis of the company's revenue is as follows:

2022
2021
£
£
Revenue analysed by class of business
Handling revenues
17,745,507
10,701,382
Ancillary revenues
2,006,546
1,085,087
Ticketing revenues
645,555
471,045
Coronavirus job retention scheme grant
-
1,379,050
20,397,608
13,636,564
GH LONDON GROUND HANDLING SERVICES LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
3
Revenue
(Continued)
- 19 -
2022
2021
£
£
Revenue analysed by geographical market
United Kingdom
20,397,608
13,636,564
2022
2021
£
£
Other revenue
Grants received
-
35,068
4
Exceptional item
2022
2021
£
£
Income
Cononavirus job retention scheme grant
-
1,379,050
5
Operating loss
2022
2021
Operating loss for the year is stated after charging/(crediting):
£
£
Exchange losses/(gains)
21,261
(194)
Government grants
-
(35,068)
Fees payable to the company's auditor for the audit of the company's financial statements
16,500
15,000
Depreciation of owned property, plant and equipment
158,008
146,954
Depreciation of property, plant and equipment held under finance leases
-
8,500
Profit on disposal of property, plant and equipment
-
(47,500)
Amortisation of intangible assets
550,367
743,770
Operating lease charges
2,713,088
1,415,189
Warning: Analysis of depreciation between Income statement and Statement of financial position do not reconcile by:
1
1
6
Employees

The average monthly number of persons (including directors) employed by the company during the year was:

2022
2021
Number
Number
Operations
680
518
Administration
39
40
Total
719
558
GH LONDON GROUND HANDLING SERVICES LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
6
Employees
(Continued)
- 20 -

Their aggregate remuneration comprised:

2022
2021
£
£
Wages and salaries
11,288,706
8,338,127
Social security costs
1,038,371
683,807
Pension costs
282,016
176,995
12,609,093
9,198,929
7
Finance costs
2022
2021
£
£
Other finance costs:
Interest on finance leases and hire purchase contracts
7,694
2,735
Other interest
129
2,084
7,823
4,819
8
Taxation
2022
2021
£
£
Deferred tax
Origination and reversal of timing differences
(459,385)
(1,986,732)

The actual credit for the year can be reconciled to the expected credit for the year based on the profit or loss and the standard rate of tax as follows:

2022
2021
£
£
Loss before taxation
(2,473,465)
(1,695,422)
Expected tax credit based on the standard rate of corporation tax in the UK of 19.00% (2021: 19.00%)
(469,958)
(322,130)
Tax effect of expenses that are not deductible in determining taxable profit
1,680
(10,168)
Unutilised tax losses carried forward
339,376
286,231
Permanent capital allowances in excess of depreciation
27,552
30,010
Depreciation on assets not qualifying for tax allowances
1,616
1,616
Other non-reversing timing differences
(459,385)
(1,972,291)
Deferred tax adjustments in respect of prior years
99,734
-
0
Taxation credit for the year
(459,385)
(1,986,732)
GH LONDON GROUND HANDLING SERVICES LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 21 -
9
Intangible fixed assets
Goodwill
£
Cost
At 1 January 2022 and 31 December 2022
7,388,758
Amortisation and impairment
At 1 January 2022
6,838,391
Amortisation charged for the year
550,367
At 31 December 2022
7,388,758
Carrying amount
At 31 December 2022
-
0
At 31 December 2021
550,367
10
Property, plant and equipment
Plant and machinery
Fixtures, fittings & equipment
Computer equipment
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 January 2022
2,094,227
24,186
62,345
67,458
2,248,216
Additions
-
0
2,178
6,876
20,458
29,512
At 31 December 2022
2,094,227
26,364
69,221
87,916
2,277,728
Depreciation and impairment
At 1 January 2022
1,361,356
9,279
60,905
30,461
1,462,001
Depreciation charged in the year
138,505
2,636
1,275
15,592
158,008
At 31 December 2022
1,499,861
11,915
62,180
46,053
1,620,009
Carrying amount
At 31 December 2022
594,366
14,449
7,041
41,863
657,719
At 31 December 2021
732,871
14,907
1,440
36,998
786,216

The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.

2022
2021
£
£
Motor vehicles
25,500
34,000
GH LONDON GROUND HANDLING SERVICES LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 22 -
11
Fixed asset investments
2022
2021
Notes
£
£
Investments in subsidiaries
12
1
1
12
Subsidiaries

These financial statements are separate company financial statements for GH London Ground Handling Services Ltd.

Details of the company's subsidiaries at 31 December 2022 are as follows:

Name of undertaking
Registered office
Nature of business
Class of
% Held
shares held
Direct
GH Birmingham Ground Handling Services Ltd
United Kingdom
Airport Ground Handling and Ticketing Services
Ordinary shares
100.00
13
Trade and other receivables
2022
2021
Amounts falling due within one year:
£
£
Trade receivables
1,996,321
1,727,638
Amounts owed by group undertakings
481,434
319,502
Other receivables
287,141
315,875
Prepayments and accrued income
227,259
241,802
2,992,155
2,604,817
14
Current liabilities
2022
2021
Notes
£
£
Obligations under finance leases
16
14,167
14,167
Trade payables
2,313,272
5,526,168
Amounts owed to group undertakings
2,741,411
4,713,518
Taxation and social security
473,558
493,941
Other payables
900,342
754,301
Accruals and deferred income
847,911
626,985
7,290,661
12,129,080
GH LONDON GROUND HANDLING SERVICES LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 23 -
15
Non-current liabilities
2022
2021
Notes
£
£
Obligations under finance leases
16
16,528
28,333
Amounts owed to group undertakings
7,000,000
-
0
7,016,528
28,333
16
Finance lease obligations
2022
2021
Future minimum lease payments due under finance leases:
£
£
Within one year
14,166
14,166
In two to five years
16,529
28,334
30,695
42,500

Finance lease payments represent rentals payable by the company for certain items of plant and machinery. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is five years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.

17
Deferred taxation

Deferred tax assets and liabilities are offset where the company has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:

Liabilities
Liabilities
2022
2021
Balances:
£
£
Taxable losses
(4,472,585)
(4,013,200)
2022
Movements in the year:
£
Asset at 1 January 2022
(4,013,200)
Credit to profit or loss
(459,385)
Asset at 31 December 2022
(4,472,585)
GH LONDON GROUND HANDLING SERVICES LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 24 -
18
Retirement benefit schemes
2022
2021
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
282,016
176,995

The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.

19
Share capital
2022
2021
2022
2021
Ordinary share capital
Number
Number
£
£
Issued and fully paid
"A" Ordinary shares of £1 each
15,300,000
15,300,000
15,300,000
15,300,000
20
Related party transactions

The following amounts were outstanding at the reporting end date:

Amounts owed to related parties
2022
2021
£
£
Other related parties
9,741,411
4,713,518
9,741,411
4,713,518

The following amounts were outstanding at the reporting end date:

Amounts owed by related parties
Amounts owed by related parties
2022
2021
Balance
Net
Balance
Net
£
£
£
£
Entities with control, joint control or significant influence over the company
1,653
1,653
1,500
1,500
Entities over which the entity has control, joint control or significant influence
437,817
437,817
276,038
276,038
Other related parties
41,964
41,964
41,964
41,964
481,434
481,434
319,502
319,502

No guarantees have been given or received.

GH LONDON GROUND HANDLING SERVICES LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 25 -
21
Ultimate controlling party

The parent entity is GPZ Investments Ltd, a company registered in the United Kingdom. The ultimate controlling party is Gian Piero Zincone.

22
Cash generated from operations
2022
2021
£
£
(Loss)/profit for the year after tax
(2,014,080)
291,310
Adjustments for:
Taxation credited
(459,385)
(1,986,732)
Finance costs
7,823
4,819
Gain on disposal of property, plant and equipment
-
(47,500)
Amortisation and impairment of intangible assets
550,366
743,770
Depreciation and impairment of property, plant and equipment
158,008
155,453
Movements in working capital:
Increase in trade and other receivables
(387,338)
(143,882)
Increase in trade and other payables
2,161,581
1,470,389
Cash generated from operations
16,975
487,627
23
Analysis of changes in net funds
1 January 2022
Cash flows
31 December 2022
£
£
£
Cash at bank and in hand
884,644
(32,163)
852,481
Obligations under finance leases
(42,500)
184,088
(30,695)
842,144
151,925
821,786
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