Registered number:
FOR THE YEAR ENDED 30 APRIL 2023
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GOLFBREAKS LIMITED
COMPANY INFORMATION
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GOLFBREAKS LIMITED
CONTENTS
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GOLFBREAKS LIMITED
GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 30 APRIL 2023
The directors present their strategic report together with the audited financial statements for the year ended 30 April 2023.
The principal activity of the Group and Company continued to be the promotion of golf breaks, golf holidays and golf tournament experiences across our three consumer markets of the UK and Ireland, Scandinavia and the USA. There have not been any significant changes in the Group’s principal activities in the period.
The Group has made a considerable recovery following the COVID-19 pandemic, exceeding budgets across all key financial performance metrics as detailed in the key performance indicators section on page 3.
Celebrating our 25th anniversary in May 2023, turnover has increased to just over £100M, which is 21% growth on our pre-pandemic best year in 2019. Our financial performance has improved significantly with growth in market share and profitability reaching new levels. This success can be attributed to our robust product offering and supplier relationships, effective cost management, and leveraging our strategic investments in technology and data. We have also maintained a healthy cash flow, enabling us to further invest in our growth and explore new opportunities. During the year the Group has also benefited from airline and hotel partners expanding their capacity back to pre-pandemic levels as they navigated their own business recovery strategies. In the US business, we continued to see rapid increases in revenues during the year as our partnership with the PGA TOUR bears fruit in terms of brand reputation and increasing demand. The travel industry continued to navigate several challenges during the year, including economic uncertainties and the associated cost-of-living crisis, geopolitical tensions in Eastern Europe, and the disruptive impact the COVID-19 pandemic and Brexit have had on labour shortages in the supply chain. The Golfbreaks Group has demonstrated resilience and adaptability, leveraging our strong brand reputation and customer loyalty to navigate through these turbulent times. We are capitalising on our strong customer review ratings and an increased use of data and personalisation, to retain a high proportion of existing clients and to acquire new clients. To continue our strong financial performance and capitalise on future opportunities, we remain focused on our core strategic initiatives: 1. Customer-Centric Approach: We will continue to prioritise customer satisfaction by enhancing our service offering, investing further in technology to support the sales and booking management process. 2. Digital Transformation: We will invest further in data analytics and AI to improve operational efficiency and provide personalised booking experiences and recommendations for our customers. 3. Supply Relationships: We will continue to nurture our long-established relationships and explore new opportunities to expand our business providing the best choice and experience across each of our geographic markets. 4. Talent Retention and Development: Our success and culture is driven by our dedicated and skilled workforce. We will invest in communication, training and development to nurture talent, surface innovation, and ensure our employees are motivated and equipped with the necessary skills to adapt to changing technology and market dynamics. 5. Sustainable Travel: We are committed to minimising our environmental impact and as we emerge from the turbulent chapter of the pandemic, we will work towards reducing our own carbon emissions and place a greater emphasis on partnering with eco-friendly suppliers to offer sustainable travel to our customers.
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GOLFBREAKS LIMITED
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2023
Business review (continued)
The directors would like to express our gratitude to our employees, our customers, and our suppliers for their long-term loyalty and commitment to our business. Together, we will continue to grow and excel and make memorable golf experiences both domestically and across the globe.
Liquidity risk
The Group and Company seeks to manage financial risk by ensuring sufficient liquidity is available to meet foreseeable needs and to invest cash assets safely and profitably. Due to the seasonality of the business the Group's liquidity is at a low point in December. The impact of this risk is that the Group could have difficulty in meeting its financial obligations as they fall due. The directors mitigate this risk by focusing on cash management and detailed cash flow forecasting. The credit risk associated with the cash is limited as the counterparties have high credit ratings assigned by international credit-rating agencies. Exchange rate risk The Group is exposed to transaction foreign exchange risk. Transaction exposures, including those associated with forecast transactions, are hedged when known, principally using forward currency contracts. Whilst the aim is to achieve an economic hedge, the Group does not adopt an accounting policy of hedge accounting for these financial statements. Regulatory risk The travel industry is highly regulated. The impact of this is the inability to trade due to loss of licence which would damage the Company's reputation. To mitigate the risk, the Group reports regularly to its external regulators, the Civil Aviation Authority ("CAA"), Association of British Travel Agents ("ABTA"), Association of Bonded Travel Organisers Trust ("ABTOT") and the Danish Travel Guarantee Fund ("DTGF"). The CAA issues an Air Travel Organisers Licence ("ATOL") and is required in order for the Group to operate in the UK. This licence is renewed in September each year and is subject to assessments of fitness and financial criteria, the framework of which is available on the CAA website (www.caa.co.uk). Economic conditions Decline in consumer demand due to the global economic environment and UK cost of living crisis could have the impact of reducing volumes and put pressure on profitability. The Group operates across a number of markets in the UK, Europe and the rest of the world, and as can be seen from the financial statements and forward outlook, the Group has been able to continue trading at record levels due to a diverse market portfolio.
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GOLFBREAKS LIMITED
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2023
Principal risks and uncertainties (continued)
Political, social, and environmental factors Due to the nature of the industry that the Group operates in, the Group faces political risks (for example social unrest or terrorism), environmental risks (such as hurricanes or volcanic eruptions) and health risks in destinations in which we operate. This can result in cancellation of holidays, repatriation costs and decline in customer demand. The Group mitigates this risk by operating in several travel destinations and has established an incident management policy, making use of advice provided by ABTA (the Association of British Travel Agents) and the FCDO (Foreign Commonwealth and Development Office). Following the withdrawal of the United Kingdom from the European Union on 31 January 2020, the Group continues to consider possible contingency strategies and the regulatory benefits of operating a Scandinavian business, to ensure the business remains resilient to potential changes any new trade arrangement could bring to currency, licensing or tax treatment for travel into the EU. With the situation around the world having settled following the COVID-19 pandemic, consumer confidence has returned. Nonetheless, the Group continues to monitor latest data, scientific guidance and government announcements for signs of further disruption. We report internally on levels of customer demand, new bookings, cancellations and customer balances on a daily basis to observe any changes and impact to trading. We continue to consult with staff on their capability to work remotely or in the office under a modern hybrid working policy to maintain operations and service levels. To sustain our improved profitability, we continue to monitor all non-essential spending whilst benefiting from other more significant cost reduction measures and improvements to working capital from increased operational efficiency and better use of data analytics in our marketing and digital teams. The uncertainty as to the future impact of the cost-of-living crisis on the Group has also been considered as part of the Group’s adoption of the going concern basis, as explained in note 2.3 on page 25.
The results for the 12-month period are set out in the Consolidated Statement of Comprehensive Income on page 15. The comparatives are for the 12-month period from 1 May 2021 to 30 April 2022.
The financial key performance indicators of the Group are explained below and they reflect a strong recovery in business following the exceptionally difficult trading conditions experienced in the travel industry during the COVID-19 pandemic. Turnover increased to £100,366,640 (2022 - £69,929,029). Gross profit increased to £18,667,122 (2022 - £12,570,863) with gross margin percentage increasing to 18.60% (2022 - 17.98%). Operating expenses, which excludes any savings or grants available from government support, in the period amounted to £13,178,895 (2022 - £9,740,735). The average number of employees during the reporting period was 174 (2022 - 152). The resulting profit on ordinary activities after taxation for the period ended 30 April 2023 amounted to £2,933,165 (2022 - £1,383,879). As a result of the above, the Group’s net balance sheet position increased to £443,925 of net assets (2022 - net liabilities of £2,220,386).
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GOLFBREAKS LIMITED
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2023
The Group uses a variety of financial instruments including cash, equity instruments, mini bonds, trade creditors and debtors and forward exchange contracts, which arise directly from its operations. The main purpose of these financial instruments is to provide working capital for the Group operations.
Given the size of the Group, the directors have not delegated the responsibility of monitoring financial risk management to a sub-committee of the Board. The policies set by the Board of directors are implemented by the Group’s senior finance team. The directors are of the view that the main risks arising from the Group’s financial instruments are exchange rate risk and liquidity risk. The directors set and review policies for managing each of these risks and they are summarised in the principal risks and uncertainties above.
s.172 of the Companies Act 2006 sets out the duties of directors when exercising powers and discharging their responsibilities. This report sets out how the directors of the Group have complied with their statutory duties in the reporting period.
The Board During the reporting period, the Board was comprised of two independent non-executive directors (Compton Hellyer and Matthew Witt), one non-executive director representing the PGA TOUR’s shareholding (Lance Stover) and the four founding executive directors (Andrew Stanley, Steve Hemsworth, Guy Proddow and Daniel Grave). Matthew Witt resigned after stepping into full-time retirement on 31 March 2023. The founding directors represent the majority shareholding in the Group and continue to be directly invested in promoting the success of the Group for the benefit of the members as a whole. The Board has long term considerations at its heart. The intention of the Group is to continue its position as the global leader in golf travel continuing to focus on its employees, its customers and its suppliers creating long term and lasting relationships built on honesty, integrity and trust. Further details are included in the ‘Future Developments’ section of this report.
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GOLFBREAKS LIMITED
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2023
Directors' statement of compliance with duty to promote the success of the Group (continued)
Discharging its statutory duties The Board recognises that decision making for the long term requires that the interests of various stakeholders be considered including those of employees, customers, suppliers and the wider community in which the Group operates. The Board also recognises, and has regard to, its governance frameworks and high standards of business conduct in managing the affairs of the Group. The Board discharges its duties through: - Having a clear plan of meetings to address the matters that are important to the Group’s long-term health; - Considering the Group’s relationships with employees and continuing to promote a positive company culture (emphasised this year with a number of events to celebrate its 25th anniversary) through regular communication, transparency and healthy recognition of individual and team achievement; - Providing assurance to our customers of the high standards that we instill in our sales and service teams by taking a proactive client-centric approach which is monitored continuously through our operational systems and proactive customer review process; - Promoting a policy of being fair to all suppliers with timely payments of invoices and regular communication and trading updates through our dedicated Product Management Team; - Continuously monitoring the Group’s financial health; and - The governance framework that it puts in place and regularly monitors. The Board is presented with regular board packs and presentations to support it with the information that it needs to discharge its responsibilities. This information includes data in relation to demand, bookings, customer relationships, supplier relationships, market developments and trends and other information relating to the long term health of the Group. Employee responses to surveys and communication programmes are also considered by the Board. The Board also has direct engagement with employees within different functions of the business to help inform its decision making.
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GOLFBREAKS LIMITED
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2023
Directors' statement of compliance with duty to promote the success of the Group (continued)
Key board considerations During the reporting period, the Board addressed a number of specific issues including (but not limited to): - Capital requirements and structures to consider re-financing of the Golfbreaks Bonds instruments to ensure there are sufficient available facilities to support the Group’s medium-term needs, bearing in mind the significantly improving financial performance of the Group; - Industry-wide consultations regarding the Package Travel Regulations in the UK and EU and the options available to comply with the required regulations. Specifically, we transitioned our financial protection for non licensable package bookings to the Association of Bonded Travel Organisers Trust ("ABTOT") whilst maintaining a trade membership with the Association of British Travel Agents ("ABTA"); - Consultation with our minority shareholder regarding the formation of a new golf tour to rival the PGA TOUR and any impact that could be foreseen with the strategic support and brand association in the short-medium-term; - Accelerated growth in the US subsidiary as per the strategic plan and ensuring the supply chain maintains pace with the anticipated demand as brand reputation grows; and - The strong culture and longevity of the leadership and management teams and focusing on staff retention, training and well-being, bearing in mind cost-of-living pressures and increased business performance. During the course of their discussions, the Board takes account of relevant stakeholder’s views. It has particular regard to the long term objectives of ensuring there is a strong business capable of protecting the interests of the founder directors and the PGA TOUR. In turn, this long term approach is in the interests of customers, suppliers, employees and the community at large.
The strategic focus is to drive increased profitability in the parent UK business through increased marketing and sales conversion, whilst continuing with our excellent customer satisfaction ratings, leveraging the investments made to date and continuing to evolve with the ever changing pace of technology. The focus for our overseas subsidiaries is continued growth, brand development and market penetration, enabling the near-term recoverability of inter-company loans from the start-up years having become profitable business units.
The Group has experienced strong growth with another record breaking first quarter to start the new financial year in both revenues and profitability. The forward order book exceeds the same point last year in all markets. In the US we continue to work with our strategic partner and shareholder the PGA TOUR to develop the Golfbreaks by PGA TOUR brand as the de facto market leader of golf travel in the North American market. Golf travel continues to trend positively and the recent marketing insight reports from the R&A and National Golf Foundation show encouraging signs to help accelerate our growth.
This report was approved by the board on 25 July 2023 and signed on its behalf.
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GOLFBREAKS LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 APRIL 2023
The directors present their report and the financial statements for the year ended 30 April 2023.
The directors are responsible for preparing the Group Strategic Report, the Directors' Report and the consolidated 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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. 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 the Group and of the profit or loss of the Group for that period.
In preparing these financial statements, the directors are required to:
∙select suitable accounting policies for the Group's financial statements and then apply them consistently;
∙make judgments and accounting estimates that are reasonable and prudent;
∙state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;
∙prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group will continue in business.
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 the Group and to 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 the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The directors are responsible for the maintenance and integrity of the corporate and financial information included on the Group's website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements and other information included in Directors' Reports may differ from legislation in other jurisdictions.
The profit for the year, after taxation and minority interests, amounted to £2,947,022 (2022 - £1,381,808).
A dividend of £150,000 (2022: £150,000) was paid during the year to the shareholders.
The directors who served during the year were:
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GOLFBREAKS LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2023
The Group will seek to minimise adverse impacts on the environment from its activities, whilst continuing to address health, safety and economic issues. The Group has complied with all applicable legislation and regulations.
The directors are mindful of their statutory duty to act in the way they each consider, in good faith, would be most likely to promote the success of the Group for the benefits of its members as a whole, as set out in our s172(1) statement on pages 4 and 5 of the Strategic Report. A consideration of the Group’s relationship with wider stakeholders, including suppliers and customers, is also disclosed in the same statement.
The Group's greenhouse gas emissions and energy consumption for the year are 46,011 kgCO2e and 206,345 kWh.
The Group has historically applied “GHG Reporting Protocol – Corporate Standard” methodology and used Energyfit.uk energy and carbon reporting calculator to measure and report greenhouse gas emissions.
The Group is reporting as a large, unquoted group. The operational control approach has been used to identify the boundaries, from which the Group has identified three scopes for reporting: - Scope 1 direct emissions issued from sources directly controlled by the company, such as stationary combustion equipment for building heating - Scope 2 indirect emissions from electricity production, or from imported heat or vapor consumed in the buildings and equipment operation, provided by an external party - Scope 3 other indirect emissions issued from company activities but controlled by external parties, principally staff mileage claims
The Group is committed to minimising the negative impact that our actions have on the environment.
We continue to look at ways to minimise travel through continued use of video meeting technology, taking the learnings from the pandemic as to how business can be conducted efficiently. We continue to advocate a hybrid working policy, local staff are encouraged to take up cycle-to-work schemes and we are introducing an Electric Vehicle leasing scheme to staff in the parent UK business in the first half of this year.
Having consulted with the landlord and building management, to review the lighting at the Group head office, Minton Place, all lighting has recently been replaced with LED panel lights at a cost to the business and is already seeing returns on reduced electricity consumption.
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GOLFBREAKS LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2023
There have been no significant events affecting the Group since the year end.
The auditors, White Hart Associates (London) Limited, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.
This report was approved by the board on
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GOLFBREAKS LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF GOLFBREAKS LIMITED
We have audited the financial statements of GOLFBREAKS LIMITED (the 'parent Company') and its subsidiaries (the 'Group') for the year ended 30 April 2023, which comprise the Group Profit and Loss Account, the Group Statement of Comprehensive Income, the Group and Company Statements of Financial Position, the Group Statement of Cash Flows, the Group and Company Statement of Changes in Equity and the related notes, including a summary of 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).
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 Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the Group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council'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.
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 Group's or the parent 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.
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GOLFBREAKS LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF GOLFBREAKS LIMITED (CONTINUED)
The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' 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.
In our opinion, based on the work undertaken in the course of the audit:
∙the information given in the Group Strategic Report and the Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
∙the Group Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.
In the light of the knowledge and understanding of the Group and the parent Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group Strategic Report or the Directors' Report.
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GOLFBREAKS LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF GOLFBREAKS LIMITED (CONTINUED)
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 Auditors' 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 Group financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:
- We exercise professional judgment and maintain professional skepticism throughout the audit; - We identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the deliberate override of internal control; - We obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of internal control; - We evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made; - We assess the risk of management override of controls, including testing journal entries and other adjustments for appropriateness, and evaluating the business rationale of significant transactions outside the normal course of business; - We review the scope of the Group's compliance with The Package and Linked Travel Arrangements Regulations 2018 (“PTRs”) and sample test relevant documentation to assess this and the effectiveness of its control environment; - We request and review the minutes of management meetings, and assess any matters identified not already provided for or disclosed that may materially impact the financial statements;
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GOLFBREAKS LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF GOLFBREAKS LIMITED (CONTINUED)
Auditors' responsibilities for the audit of the financial statements (continued)
- We review the Group's relationships with related parties, identifying and disclosing transactions during the year and balances at year-end with such parties; - We conclude on the appropriateness of the directors' use of the going concern basis of accounting and, based on the evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the entity's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our Auditor's Report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our Auditor's Report. However, future events or conditions may cause the entity to cease to continue as a going concern.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditors' 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 Auditors' 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.
for and on behalf of
Chartered Accountants and Statutory Auditors
2nd Floor, Nucleus House
2 Lower Mortlake Road
TW9 2JA
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GOLFBREAKS LIMITED
CONSOLIDATED PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 30 APRIL 2023
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GOLFBREAKS LIMITED
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 APRIL 2023
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GOLFBREAKS LIMITED
REGISTERED NUMBER: 03571913
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 APRIL 2023
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GOLFBREAKS LIMITED
REGISTERED NUMBER: 03571913
CONSOLIDATED STATEMENT OF FINANCIAL POSITION (CONTINUED)
AS AT 30 APRIL 2023
The financial statements were approved and authorised for issue by the board and were signed on its behalf on
The notes on pages 24 to 50 form part of these financial statements.
Page 17
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GOLFBREAKS LIMITED
REGISTERED NUMBER: 03571913
COMPANY STATEMENT OF FINANCIAL POSITION
AS AT 30 APRIL 2023
Page 18
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GOLFBREAKS LIMITED
REGISTERED NUMBER: 03571913
COMPANY STATEMENT OF FINANCIAL POSITION (CONTINUED)
AS AT 30 APRIL 2023
The financial statements were approved and authorised for issue by the board and were signed on its behalf on
The notes on pages 24 to 50 form part of these financial statements.
Page 19
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CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 APRIL 2023
Page 20
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GOLFBREAKS LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 APRIL 2023
Page 21
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GOLFBREAKS LIMITED
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 APRIL 2023
Page 22
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GOLFBREAKS LIMITED
CONSOLIDATED ANALYSIS OF NET DEBT
FOR THE YEAR ENDED 30 APRIL 2023
Page 23
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GOLFBREAKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023
As disclosed in the Strategic Report, the principal activity of the Group and Company in the period under review was the promotion of golf breaks, golf holidays and golf tournament experiences across its three consumer markets of the UK and Ireland, Scandinavia and the USA.
The Company is a private company limited by shares and is incorporated in England. The address of the Group's principal place of business, being the same as the registered office stated on the Company Information page, is: Minton Place Victoria Street Windsor Berkshire SL4 1EG
2.Accounting policies
The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires Group management to exercise judgment in applying the Group's accounting policies (see note 3).
The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Profit and Loss Account in these financial statements.
The following principal accounting policies have been applied:
The consolidated financial statements present the results of the Company and its own subsidiaries ("the Group") as if they form a single entity. Intercompany transactions and balances between group companies are therefore eliminated in full.
The consolidated financial statements incorporate the results of business combinations using the purchase method. In the Statement of Financial Position, the acquiree's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquired operations are included in the Consolidated Profit and Loss Account from the date on which control is obtained. They are deconsolidated from the date control ceases.
Page 24
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GOLFBREAKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023
2.Accounting policies (continued)
The Group reported profits for the period of £2,933,165 and has a Net Surplus in Shareholders’ Funds of £443,925. The financial statements have been prepared on the going concern basis as the directors have prepared sensitised forecasts and having undertaken a review of the future financing requirements for on-going operations of the Group, are satisfied that sufficient cash facilities are secured to meet its working capital requirements for at least 12 months from the date of signing of these financial statements.
Bond Redemption At 30 April 2023 the group has net current liabilities of £853,476 excluding bond redemption repayments of £173,000 due in the next 12 months from the balance sheet date. As part of their review, the directors have made certain estimates about the redemption of bond 1. The next potential notification date for bond 1 holders to request redemption of bonds is in January 2024, for redemption in July 2024. The directors have used an anticipated redemption rate based on the historic redemption experience of bond 1, since the first redemption window in January 2018, when forecasting. In the event of a 100% redemption requirement in July 2024 in respect of bond 1, the Group will still have sufficient headroom to meet its working capital requirements over the next 12 months. The next potential notification date for bond 2 holders to request redemption of bonds is in May 2024, for redemption in November 2024. Recovery Post Coronavirus (COVID-19) Pandemic and Cost of Living Crisis The uncertainty as to the rate of recovery of the Group from the COVID-19 pandemic and the potential impact of the cost of living crisis on the recovery has also been considered as part of the Group's adoption of the going concern basis. Downside sensitivities were applied to the base case cashflow model to understand the potential impact of further deferred bookings or refunds, based on extended trading restrictions, future prospects, performance and an assessment of the economic environment. Whilst it remains difficult to predict any future pandemics, the directors continue to responsibly manage cash reserves and take the required commercially reasonable steps (including options to pursue further financing) to mitigate any downside scenarios. For this reason, the directors continue to adopt the going concern basis in preparing the financial statements.
Page 25
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GOLFBREAKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023
2.Accounting policies (continued)
Functional and presentation currency
Transactions and balances
Revenue represents (a) the gross value (total transaction value) at which the services earned as a tour operator have been sold to the customer and (b) rebates and overrides received from suppliers. Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts and rebates.
Page 26
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GOLFBREAKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023
2.Accounting policies (continued)
If it is not possible to distinguish between the research phase and the development phase of an internal project, the expenditure is treated as if it were all incurred in the research phase only. Grants of a revenue nature are recognised in the Consolidated Profit and Loss Account in the same period as the related expenditure.
Page 27
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GOLFBREAKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023
2.Accounting policies (continued)
Where equity instruments are granted to persons other than employees, the transaction is recorded at the fair value of goods and services received. For transactions with parties other than employees, the measurement date is the date when the entity obtains the goods or the counterparty renders the service.
Page 28
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GOLFBREAKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023
2.Accounting policies (continued)
All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.
The estimated useful lives range as follows:
At each reporting date the company assesses whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined which is the higher of its fair value less costs to sell and its value in use. An impairment loss is recognised where the carrying amount exceeds the recoverable amount.
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.
Depreciation is provided on the following basis:
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.
Page 29
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GOLFBREAKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023
2.Accounting policies (continued)
In the consolidated accounts, interests in associated undertakings are accounted for using the equity method of accounting. Under this method an equity investment is initially recognised at the transaction price (including transaction costs) and is subsequently adjusted to reflect the investors share of the profit or loss, other comprehensive income and equity of the associate. The Consolidated Profit and Loss Account includes the Group's share of the operating results, interest, pre-tax results and attributable taxation of such undertakings applying accounting policies consistent with those of the Group. In the Consolidated Statement of Financial Position, the interests in associated undertakings are shown as the Group's share of the identifiable net assets, including any unamortised premium paid on acquisition. Any premium on acquisition is dealt with in accordance with the goodwill policy.
Page 30
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GOLFBREAKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023
2.Accounting policies (continued)
Provisions are charged as an expense to profit or loss in the year that the Group becomes aware of the obligation, and are measured at the best estimate at the reporting date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties. When payments are eventually made, they are charged to the provision carried in the Statement of Financial Position.
Page 31
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GOLFBREAKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023
2.Accounting policies (continued)
Forward exchange contracts are used to manage currency fluctuations by purchasing foreign currency in advance to match future currency commitments when they become due. Foreign exchange contracts and the amounts due are valued at the time when the contract is entered into. In accordance with FRS 102 these forward exchange contracts are revalued at the year end valuation and the resulting gain or loss is recognised in the income statement. At 30 April 2023, the Group had entered into forward exchange contracts to buy £3,088,299 (2022 - £Nil) of foreign currencies.
Page 32
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GOLFBREAKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023
The estimates and underlying assumption are reviewed on a regular and 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. Critical accounting estimates and assumptions Investments - Management assess the investments held for evidence of impairment annually. When assessing for impairment, management considers factors including performance of investments, forecasts and future strategic plans. Useful life of intangible assets - The Group assesses the expected useful life of all intangibles and amortises them over the corresponding period, currently between 5 and 10 years. The directors have applied a life of 10 years to computer software where they consider this to be built around 'best in class' platforms. The Group continually monitors this policy and the performance of the assets, and will amend the estimate of the useful life should it be required. Loyalty Scheme Provision - Management provide for the expected redemption of currently available loyalty points within future periods. The provision is calculated using historical data to determine expected redemption rates. This provision is regularly reviewed and amended should it be required. Intercompany recoverability - The Group assesses its intercompany balances for recoverability. When assessing for impairment, management considers factors including historical experience, knowledge of performance, and future forecasts based upon strategic investment plans. Management have assumed year on year growth of at least 15% in revenues of the Scandinavian subsidiary. Growth assumptions related to the US subsidiary are noted below. Fair value assumptions - The directors have assessed the fair value of services received under a share based payment arrangement (note 24) using a third party expert and generally accepted methodologies, based on an underlying assumption of forecast revenue growth in the US subsidiary of 50% over the forecast period, albeit from a low base. Redemption of bonds - For Bond 2 the potential notification date is on or before 14 May 2023 for redemptions in November 2023. Since the redemption of Bond 2 is within 12 months of the date of sign off of these financial statements, but the notification deadline (May 2023) has not passed, management have made judgements about the anticipated redemption rate based on the historic redemption experience of Bonds when assessing going concern.
Page 33
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GOLFBREAKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023
The whole of the turnover is attributable to the promotion of golf breaks, golf holidays and golf tournament experiences across its three consumer markets of the UK and Ireland, Scandinavia and the USA.
Analysis of turnover by source market:
Page 34
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GOLFBREAKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023
Page 35
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GOLFBREAKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023
Page 36
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GOLFBREAKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023
There were no factors that may affect future tax charges.
Page 37
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GOLFBREAKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023
The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Profit and Loss Account in these financial statements. The profit after tax of the parent Company for the year was £
Page 38
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GOLFBREAKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023
15.Intangible assets (continued)
Page 39
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GOLFBREAKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023
Page 40
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GOLFBREAKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023
16.Tangible fixed assets (continued)
Page 41
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GOLFBREAKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023
Page 42
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GOLFBREAKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023
Page 43
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GOLFBREAKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023
Page 44
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GOLFBREAKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023
Page 45
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GOLFBREAKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023
Other loans above represent bonds issued to investors in prior periods. See note 20 for further details.
Other creditors due after more than one year above in the prior period related to loans from directors to the Group totalling £965,000, which have now been recognised as due within one year and are expected to be repaid in the coming 12 months.
Page 46
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GOLFBREAKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023
Page 47
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GOLFBREAKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023
Page 48
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GOLFBREAKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023
Share premium account
Shares to be issued This reserve represents the nominal value of the maximum number of upside shares to be issued to a minority shareholder, if certain revenue targets are met in 2024.
Foreign exchange reserve
Profit and loss account
At 30 April 2022 there were contingent liabilities outstanding in respect of counter indemnities and guarantees given by the company and the group, in the normal course of business to the Group's bond obligors in respect of ABTOT bonds amounting to £7,055,850 (2022 - £3,912,920).
The Group operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the Group in an independently administered fund. The pension cost charge represents contributions payable by the Group to the fund and amounted to £185,377 (2022 - £159,441). Contributions totalling £37,497 (2022 - £Nil) were repayable to the fund at the statement of financial position date and are included in other creditors.
Page 49
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GOLFBREAKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023
The ultimate parent company of the Group is considered to be Golfbreaks Limited, a company registered in England and Wales.
The ultimate controlling party is considered to be Mr A M Stanley by virtue of his majority shareholding in the Company.
Page 50
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