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Registered number: 05124400










RED MIST LEISURE LIMITED










ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE PERIOD ENDED 26 DECEMBER 2021

 
RED MIST LEISURE LIMITED
 
 
COMPANY INFORMATION


Directors
David Ramsey (appointed 22 December 2021)
Jason Myers (appointed 22 December 2021)




Registered number
05124400



Registered office
The Wool Barn
Peper Harow

Godalming

Surrey

GU8 6BQ




Independent auditor
Haysmacintyre LLP

10 Queen Street Place

London

EC4R 1AG





 
RED MIST LEISURE LIMITED
 

CONTENTS



Page
Strategic Report
 
1 - 2
Directors' Report
 
3 - 4
Independent Auditor's Report
 
5 - 8
Statement of Comprehensive Income
 
9
Statement of Financial Position
 
10
Statement of Changes in Equity
 
11
Notes to the Financial Statements
 
12 - 33


 
RED MIST LEISURE LIMITED
 
 
STRATEGIC REPORT
FOR THE PERIOD ENDED 26 DECEMBER 2021

Introduction
 
The Directors present their report and the financial statement for the year ended 26 December 2021.
Throughout this seven-month period the company operated 10 pubs, 7 freehold and 3 leasehold, in South East England, there were no pub disposals or new acquisitions during this time.

Business review
 
The principal activities of the company in the period under review were those of operating premium food led public houses in Surrey and Hampshire.
During this period, the Country entered lockdown as a result of COVID 19, and also hospitality businesses were only allowed to trade for a number of months with social distancing measures in place, including external eating and drinking at various times, and for much of the year, when internal dining and drinking were permitted, at tables only with set distances and barriers in place which reduced the cover count in each site by c 40%, thereby reducing revenue potential. 
Aside from managing Covid much of the Directors’ time was spent trying to build revenues and manage costs in an environment when even when restrictions were lifted, many consumers were reluctant to socialise and eat and drink out. 
The company joined the Red Lion group in January 2021 when its immediate parent company, Red Mist Holdings Limited, was acquired.

Results, Performance and Key Performance Indicators
 
Turnover increased by 90% from £4.40m for the seven month period to 27 December 2020 to £8.36m for the year to 26 December 2021. The increase in revenue was as a result of less time closed due to lockdown and COVID 19, although the first four months of 2021 suffered from the restrictions in place to suppress COVID 19.
The operating result for the year was an operating loss of £919k compared to a £396k profit in the previous period.
The company reported a loss before tax of £948k for the year compared to a £181k profit before tax in the previous period.

Page 1

 
RED MIST LEISURE LIMITED
 

STRATEGIC REPORT (CONTINUED)
FOR THE PERIOD ENDED 26 DECEMBER 2021

Principal risks and uncertainties
 
There are a number of factors that will affect the performance of the business in the future including competition, increasing costs and consumer confidence. 
The departure from the European Union and the Covid-19 pandemic have disrupted the hospitality industry significantly and created a number of risks to our future operations and performance;
People
Recruitment and retention of key staff was challenging before the pandemic and it is clear a large volume of people left the industry during the last 24 months. This has subsequently resulted in a number of staffing shortages across the industry particularly for kitchen staff and as a result wages have risen sharply. As a group we have strengthened our recruitment and people team providing the necessary focus required to source and retain high quality candidates but the Board considers this a medium and long term risk. It is anticipated that staffing shortages will continue to disrupt the industry and may result in some pubs having to enforce short term closures or part closures until the situation improves.
Food Hygiene and health and safety
The Board considers all aspects of health and safety and food hygiene of the highest importance. The business benefits from extensive level of operational expertise and support staff as well as external specialist partners who monitor, train and support our onsite teams.
Financing and debt
The board recognises that securing new debt to grow the business will be challenging on the basis of disrupted performance during lockdown and losses and weaker profits incurred during the period. 
Summary
The Board continues to monitor costs carefully and make reductions where necessary. Trading remains challenging whilst consumer confidence is dented by the pandemic, and the risk of further lockdowns and trading restrictions to safeguard customers remains real.  Despite the very uncertain outlook in the short term the directors remain positive and upbeat about the long term success of the business given the quality of the portfolio, the strength of the team and the premium nature of the offer and customer proposition.


This report was approved by the board and signed on its behalf.



David Ramsey
Director

Date: 16 October 2023

Page 2

 
RED MIST LEISURE LIMITED
 
 
 
DIRECTORS' REPORT
FOR THE PERIOD ENDED 26 DECEMBER 2021

The directors present their report and the financial statements for the period ended 26 December 2021.

Directors' responsibilities statement

The directors are responsible for preparing the Strategic Report, the Directors' 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 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 of the profit or loss of the Company for that period.

 In preparing these financial statements, the directors are required to:


select suitable accounting policies for the Company's financial statements and then apply them consistently;

make judgements and accounting estimates that are reasonable and prudent;

prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company 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 to enable them to ensure that the financial statements comply with the Companies Act 2006They 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.

Principal activity

The Company's principal activity is the operation of public houses.

Results and dividends

The loss for the period, after taxation, amounted to £1,051,470 (2020 - profit £54,983).

Directors

The directors who served during the period were:

Mark Robson (resigned 1 July 2022)
Mark Williams (resigned 1 July 2022)
Julian Clarke (resigned 22 January 2021)
Julie Phipps (resigned 22 January 2021)
David Ramsey (appointed 22 December 2021)
Jason Myers (appointed 22 December 2021)

Page 3

 
RED MIST LEISURE LIMITED
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE PERIOD ENDED 26 DECEMBER 2021

Disclosure of information to auditor

Each of the persons who are directors at the time when this Directors' Report is approved has confirmed that:
 
so far as the director is aware, there is no relevant audit information of which the Company's auditor is unaware, and

the director has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the Company's auditor is aware of that information.

Post balance sheet events and going concern

On 1 July 2022, 38.41% of the ordinary share capital in the immediate parent undertaking, Red Mist Holdings Limited ("RMH") was acquired by Red Lion Holdings 2 Limited ("RLH2"), a wholly owned company of the group for consideration of £5,290,978.
This transaction was partly settled by the transfer of the trade and assets of three pub sites from Red Mist Leisure Limited to NDPC Limited (formerly Red Mist Rose and Crown Limited), a fellow group subsidiary up to 1 July 2022.
The sites transferred consisted of The Royal Exchange in Lindford, Bordon, The Red Lion in Hook and The Castle Inn in Farnham, Surrey.  The consideration paid to the Company for these transfers was £4,025,000 via an interest-free loan, payable on demand, provided by RLH2. 
On 5 December 2022, the Company sold The Temple Inn in Liss for net sales proceeds of £546,039.
On 29 December 2022, the Company sold the Stag on The River in Eashing to Red Lion Operations 1 Limited ("RLO1"), a fellow subsidiary of the group, for consideration of £3.4m satisfied by an intercompany debt of the same amount.  On the same day, the Company directed that monies receivable from RLO1 of £3.4m should be directed to RMH in order to satisfy existing debt.

Auditor

Under section 487(2) of the Companies Act 2006Haysmacintyre LLP will be deemed to have been reappointed as auditor 28 days after these financial statements were sent to members or 28 days after the latest date prescribed for filing the accounts with the registrar, whichever is earlier.

This report was approved by the board and signed on its behalf.
 





David Ramsey
Director

Date: 16 October 2023

Page 4

 
RED MIST LEISURE LIMITED
 
 
 
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF RED MIST LEISURE LIMITED
 

Opinion


We have audited the financial statements of Red Mist Leisure Limited (the 'Company') for the period ended 26 December 2021, which comprise the Statement of Comprehensive Income, the Statement of Financial Position, the Statement of Changes in Equity and the related notes, including a summary of significant accounting policiesThe 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:


give a true and fair view of the state of the Company's affairs as at 26 December 2021 and of its loss for the period then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.


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 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.


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.


Page 5

 
RED MIST LEISURE LIMITED
 
 
 
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF RED MIST LEISURE LIMITED (CONTINUED)


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 ReportOur 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.


Opinion on other matters prescribed by the Companies Act 2006
 

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


the information given in the Strategic Report and the Directors' Report for the financial period for which the financial statements are prepared is consistent with the financial statements; and
the Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.


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:


adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of directors' remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.


Responsibilities of directors
 

As explained more fully in the Directors' Responsibilities Statement set out on page 3, 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.


Page 6

 
RED MIST LEISURE LIMITED
 
 
 
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF RED MIST LEISURE LIMITED (CONTINUED)


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.


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:

Based on our understanding of the Company and industry, we identified that the principal risks of non-compliance with laws and regulations related to regulatory requirements, and we considered the extent to which non-compliance might have a material effect on the financial statements. We also considered those laws and regulations that have a direct impact on the preparation of the financial statements such as the Companies Act 2006, income tax and sales tax.
We evaluated management’s incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls), and determined that the principal risks were related to posting inappropriate journal entries, to revenue and management bias in accounting estimates. Audit procedures performed by the engagement team included:
- Inspecting correspondence with regulators and tax authorities;
- Discussions with management including consideration of known or suspected instances of non-compliance   with laws and regulation and fraud;
- Evaluating management’s controls designed to prevent and detect irregularities;
- Identifying and testing journals, in particular in particular journal entries posted that significantly impact on the result for the year or appear to be unusual or not consistent with our understanding of the operations of the company; and
- Challenging assumptions and judgments made by management in their critical accounting estimates.


Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.


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 Auditor's Report.


Page 7

 
RED MIST LEISURE LIMITED
 
 
 
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF RED MIST LEISURE LIMITED (CONTINUED)


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 2006Our 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.





Emma Bernardez (Senior Statutory Auditor)
  
for and on behalf of
Haysmacintyre LLP
 
Statutory Auditors
  
10 Queen Street Place
London
EC4R 1AG

16 October 2023
Page 8

 
RED MIST LEISURE LIMITED
 
 
STATEMENT OF COMPREHENSIVE INCOME
FOR THE PERIOD ENDED 26 DECEMBER 2021

26 December
7 months ended
27 December
2021
2020
Note
£
£

  

Turnover
 4 
8,358,709
4,400,679

Cost of sales
  
(2,402,100)
(2,837,819)

Gross profit
  
5,956,609
1,562,860

Administrative expenses
  
(7,510,829)
(1,993,223)

Exceptional administrative expenses
 6 
(448,760)
-

Other operating income
 5 
1,083,988
826,305

Operating (loss)/profit
 7 
(918,992)
395,942

Interest receivable and similar income
 11 
121
-

Interest payable and similar expenses
 12 
(29,026)
(214,782)

(Loss)/profit before tax
  
(947,897)
181,160

Tax on (loss)/profit
 13 
(103,573)
(126,177)

(Loss)/profit for the financial period
  
(1,051,470)
54,983

Other comprehensive income for the period
  

Unrealised surplus on revaluation of tangible fixed assets
  
5,264,548
-

Being deferred tax movement on revaluation of tangible fixed assets
  
(1,316,137)
-

Other comprehensive income for the period
  
3,948,411
-

Total comprehensive income for the period
  
2,896,941
54,983

The notes on pages 12 to 33 form part of these financial statements.

Page 9

 
RED MIST LEISURE LIMITED
REGISTERED NUMBER: 05124400

STATEMENT OF FINANCIAL POSITION
AS AT 26 DECEMBER 2021

26 December
27 December
2021
2020
Note
£
£

Fixed assets
  

Intangible assets
 14 
129,186
157,250

Tangible assets
 15 
17,349,069
12,503,421

  
17,478,255
12,660,671

Current assets
  

Stocks
 16 
179,700
115,757

Debtors: amounts falling due within one year
 17 
2,734,887
371,781

Cash at bank and in hand
  
296,408
40,055

  
3,210,995
527,593

Creditors: amounts falling due within one year
 19 
(15,001,992)
(11,572,333)

Net current liabilities
  
 
 
(11,790,997)
 
 
(11,044,740)

Total assets less current liabilities
  
5,687,258
1,615,931

Creditors: amounts falling due after more than one year
 20 
(162,200)
(450,645)

Provisions for liabilities
  

Deferred tax
 22 
(1,785,454)
(322,623)

  
 
 
(1,785,454)
 
 
(322,623)

Net assets
  
3,739,604
842,663


Capital and reserves
  

Called up share capital 
 23 
1,589
1,589

Share premium account
 24 
58,411
58,411

Revaluation reserve
 24 
3,948,411
-

Profit and loss account
 24 
(268,807)
782,663

  
3,739,604
842,663


The financial statements were approved and authorised for issue by the board and were signed on its behalf on 16 October 2023.

David Ramsey
Director

The notes on pages 12 to 33 form part of these financial statements.

Page 10

 
RED MIST LEISURE LIMITED
 

STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 26 DECEMBER 2021


Called up share capital
Share premium account
Revaluation reserve
Profit and loss account
Total equity

£
£
£
£
£


At 1 June 2020
1,589
58,411
-
727,680
787,680


Comprehensive income for the period

Profit for the period
-
-
-
54,983
54,983
Total comprehensive income for the period
-
-
-
54,983
54,983



At 28 December 2020
1,589
58,411
-
782,663
842,663


Comprehensive income for the period

Loss for the period
-
-
-
(1,051,470)
(1,051,470)

Surplus on revaluation of freehold property
-
-
5,264,548
-
5,264,548

Being deferred tax movement on revaluation of tangible fixed assets
-
-
(1,316,137)
-
(1,316,137)
Total comprehensive income for the period
-
-
3,948,411
(1,051,470)
2,896,941


At 26 December 2021
1,589
58,411
3,948,411
(268,807)
3,739,604


The notes on pages 12 to 33 form part of these financial statements.

Page 11

 
RED MIST LEISURE LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 26 DECEMBER 2021

1.


General information

Red Mist Leisure Limited is a private company limited by shares incorporated in England and Wales. The registered office address is The Wool Barn, Peper Harow, Godalming, GU8 6BQ.

2.Accounting policies

 
2.1

Basis of preparation of financial statements

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 management to exercise judgement in applying the Company's accounting policies (see note 3).

The following principal accounting policies have been applied:

 
2.2

Financial Reporting Standard 102 - reduced disclosure exemptions

The Company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by the FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":
the requirements of Section 7 Statement of Cash Flows;
the requirements of Section 3 Financial Statement Presentation paragraph 3.17(d).

This information is included in the consolidated financial statements of Red Lion Holdings LLP as at 26 December 2021 and these financial statements may be obtained from Companies House.

 
2.3

Going concern

At the balance sheet date the Company had net current liabilities of £11,790,997.  Included within creditors due in less than one year are amounts owed to group undertakings totalling £11,875,191.  The directors have confirmed that repayment of amounts owed will not be required until the Company has the resources to do so.
The directors have prepared cash flow forecasts for the group covering a period extending beyond 12 months from the date of approval of these financial statements that demonstrate the sufficient availability of funds to continue on in business and meeting its liabilities as they fall due.  For these reasons, the directors believe it is appropriate to prepare the financial statements on a going concern basis.

 
2.4

Revenue

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable for the sale of food and beverage items as well as accommodation income, excluding value added tax and other sales taxes. Revenue is recognised at the point of sale for food and beverage provided to customers and at the when the rooms are occupied for accommodation sales.

Page 12

 
RED MIST LEISURE LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 26 DECEMBER 2021

2.Accounting policies (continued)

 
2.5

Operating leases: the Company as lessee

Rentals paid under operating leases are charged to profit or loss on a straight-line basis over the lease term.

Benefits received and receivable as an incentive to sign an operating lease are recognised on a straight-line basis over the lease term, unless another systematic basis is representative of the time pattern of the lessee's benefit from the use of the leased asset.

 
2.6

Government grants

Government grants are accounted under the accruals model as permitted by FRS 102. Grants received in the year are revenue based grants under the Coronavirus Job Retention Scheme (CJRS) and grants receivable from local government. They have been recognised as Other Income in the Statement of Comprehensive Income.

 
2.7

Interest income

Interest income is recognised in profit or loss using the effective interest method.

 
2.8

Finance costs

Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.

 
2.9

Borrowing costs

All borrowing costs are recognised in profit or loss in the period in which they are incurred.

 
2.10

Pensions

Defined contribution pension plan

The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations.

The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Statement of Financial Position. The assets of the plan are held separately from the Company in independently administered funds.

Page 13

 
RED MIST LEISURE LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 26 DECEMBER 2021

2.Accounting policies (continued)

 
2.11

Current and deferred taxation

The tax expense for the period comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.

The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the Company operates and generates income.

Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the reporting date, except that:
The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and
Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.

Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.

 
2.12

Exceptional items

Exceptional items are transactions that fall within the ordinary activities of the Company but are presented separately due to their size or incidence.

 
2.13

Intangible assets

Goodwill arises on business acquisitions and represents the excess of the cost of the acquisition over the company’s interest in the net amount of the identifiable assets, liabilities, and contingent liabilities of the acquired business. Goodwill is measured at cost less accumulated amortisation and accumulated impairment losses. It is amortised on a straight-line basis over its useful life. Where a reliable estimate of the useful life of goodwill or intangible assets cannot be made, the life is presumed not to exceed ten years.

 The estimated useful lives range as follows:

Goodwill
-
10
years

If there is an indication that there has been a significant change in amortisation rate, useful life or residual value of an intangible asset, the amortisation is revised prospectively to reflect the new estimates.

Page 14

 
RED MIST LEISURE LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 26 DECEMBER 2021

2.Accounting policies (continued)

 
2.14

Tangible fixed assets

Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

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.

Depreciation is provided on the following basis:

Freehold property
-
2% on buildings only to a residual value
Long leasehold property
-
Straightline over the shorter of the useful economic life and the period of the lease
Fixtures and fittings
-
Rates vary between 10% straightline and 25% reducing balance basis
Computer equipment
-
3 years straightline
Equipment
-
25% reducing balance

 
2.15

Revaluation of tangible fixed assets

Individual freehold and leasehold properties are carried at current year value at fair value at the date of the revaluation less any subsequent accumulated depreciation and subsequent accumulated impairment losses. Revaluations are undertaken with sufficient regularity to ensure the carrying amount does not differ materially from that which would be determined using fair value at the reporting date.
Fair values are determined from market based evidence normally undertaken by professionally qualified valuers.

Revaluation gains and losses are recognised in other comprehensive income unless losses exceed the previously recognised gains or reflect a clear consumption of economic benefits, in which case the excess losses are recognised in profit or loss.

 
2.16

Impairment of fixed assets and goodwill

Assets that are subject to depreciation or amortisation are assessed at each reporting date to determine whether there is any indication that the assets are impaired. Where there is any indication that an asset may be impaired, the carrying value of the asset (or cash-generating unit to which the asset has been allocated) is tested for impairment. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset's (or CGU's) fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (CGUs). Non-financial assets that have been previously impaired are reviewed at each reporting date to assess whether there is any indication that the impairment losses recognised in prior periods may no longer exist or may have decreased.

Page 15

 
RED MIST LEISURE LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 26 DECEMBER 2021

2.Accounting policies (continued)

 
2.17

Stocks

Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a weighted average basis. Work in progress and finished goods include labour and attributable overheads.

At each reporting date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in profit or loss.

 
2.18

Debtors

Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.

 
2.19

Cash and cash equivalents

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.

 
2.20

Creditors

Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.

 
2.21

Financial instruments

The Company has elected to apply the provisions of Section 11 “Basic Financial Instruments” 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, cash and bank balances, are initially measured at their transaction price including transaction costs and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, 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.

Discounting is omitted where the effect of discounting is immaterial. The Company's cash and cash equivalents, trade and most other receivables due with the operating cycle fall into this category of financial instruments.

Impairment of financial assets
Page 16

 
RED MIST LEISURE LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 26 DECEMBER 2021

2.Accounting policies (continued)


2.21
Financial instruments (continued)


Financial assets are assessed for indicators of impairment at each reporting date. 

Financial assets are impaired when events, subsequent to their initial recognition, indicate the estimated future cash flows derived from the financial asset(s) have been adversely impacted. The impairment loss will be the difference between the current carrying amount and the present value of the future cash flows at the asset(s) original effective interest rate.

If there is a favourable change in relation to the events surrounding the impairment loss then the impairment can be reviewed for possible reversal. The reversal will not cause the current carrying amount to exceed the original carrying amount had the impairment not been recognised. The impairment reversal is recognised in the profit or loss.

Financial liabilities

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

Basic financial liabilities, which include trade and other payables, bank loans and other loans are initially measured at their transaction price after transaction costs. When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest. Discounting is omitted where the effect of discounting is immaterial.

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

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

Page 17

 
RED MIST LEISURE LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 26 DECEMBER 2021

3.


Judgements in applying accounting policies and key sources of estimation uncertainty

Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of furture events that are believed to be reasonable under the circumstances. Although these estimates are based on management's best knowledge of the amount, events or actions, actual results ultimately may differ from those estimates. The directors consider the valuation of fixed assets to be a critical estimate and judgement applicable to the financial statements.
Tangible Fixed Assets - useful economic lives
The estimated useful economic lives of tangible fixed assets are based on management's judgement and experience. When management identifies that actual useful economic lives differ materially from the estimates used to calculate depreciation, that charge is adjusted retrospectively. Due to the significance of tangible fixed asset investment to the company, variations between actual and estimated useful economic lives could impact operating results both positively and negatively, although historically few changes to estimated useful economic lives have been required.
Adoption of revaluation policy in respect of freehold and leasehold properties and impairment review
Management have adopted a policy of revaluation in respect of freehold and leasehold properties as they consider that such a policy enables the accounts to present more relevant information to users of the accounts.  In accordance with FRS 102.10.10A, the adoption of the revaluation basis for these assets has been accounted for prospectively.
The Company is required to evaluate the carrying values of tangible fixed assets for impairment whenever circumstances indicate, in management's judgement, that the carrying value of such assets may not be recoverable. An impairment review requires management to make subjective judgements and estimates regarding the cash generating units under review. Management have identified each site to be a cash generating unit.
Management tested the carrying value of one of the company's sites for impairment in accordance with the requirements of FRS 102 and the company's accounting policy set out in Note 2.16 to these accounts. In carrying out this test the directors have estimated the recoverable amount, being the greater of fair value less costs to sell and the asset's value in use. This estimate of the recoverable amount is based on a market valuation of the site at the balance sheet date. On the basis of this value, management considere it appropriate for this reduction in value of £448,760 to be recognised as an impairment charge in the Statement of Comprehensive Income (see Note 15). This site will continue to be assessed for impairment in future years based on estimates of the recoverable amount of the site and the carrying value of the assets held at each reporting date under the existing revaluation policy.
Estimates of the fair value of the company's sites is an area of judgement. While management consider the assumptions applied to be appropriate and reasonable, changes would impact the estimated recoverable amount and consequently the impairment charge recognised, and the carrying value of tangible fixed assets, in these financial statements.

Page 18

 
RED MIST LEISURE LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 26 DECEMBER 2021

4.


Turnover

An analysis of turnover by class of business is as follows:


26 December
7 months ended
27 December
2021
2020
£
£

Food and beverage
7,917,930
4,263,438

Accommodation
440,779
137,242

8,358,709
4,400,680


All turnover arose within the United Kingdom.


5.


Other operating income

26 December
7 months ended
27 December
2021
2020
£
£

Other operating income
9,551
1,359

Net rents receivable
-
46,480

Government grants receivable
942,380
778,466

Sundry income
132,057
-

1,083,988
826,305


Government grants receivable consist of the following amounts:
- £662,381 (2020: £718,840) in relation to the Coronavirus Job Retention scheme.
- £279,999 (2020: £59,626) in respect of local government support grants including those made under the Retail, Hospitality and Leisure Grant Fund, Local Restrictions Support Grants, Lockdown Payments and Restart Grants.

Page 19

 
RED MIST LEISURE LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 26 DECEMBER 2021

6.


Exceptional items

26 December
7 months ended
27 December
2021
2020
£
£


Impairment charge in respect of tangible fixed assets
448,760
-

448,760
-

Management undertook an impairment review in respect of one of the company's sites as at the balance sheet date.  This has resulted in the recognition of an impairment charge of £448,760.


7.


Operating (loss)/profit

The operating (loss)/profit is stated after charging:

26 December
7 months ended
27 December
2021
2020
£
£

Other operating lease rentals
244,448
99,049


8.


Auditor's remuneration

During the period, the Company obtained the following services from the Company's auditor:


26 December
7 months ended
27 December
2021
2020
£
£

Fees payable to the Company's auditor for the audit of the Company's financial statements
17,000
15,000

The Company has taken advantage of the exemption not to disclose amounts paid for non-audit services as these are disclosed in the consolidated accounts of the parent Company.

Page 20

 
RED MIST LEISURE LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 26 DECEMBER 2021

9.


Employees

Staff costs, including directors' remuneration, were as follows:


26 December
7 months ended
27 December
2021
2020
£
£

Wages and salaries
3,678,076
2,059,271

Social security costs
245,462
143,101

Cost of defined contribution scheme
74,765
31,069

3,998,303
2,233,441


The average monthly number of employees, including the directors, during the period was as follows:


     26 December
   7 months ended
      27 December
        2021
        2020
            No.
            No.







Productive staff
237
198



Administrative staff
11
17



Management staff
3
5

251
220


10.


Directors' remuneration

26 December
7 months ended
27 December
2021
2020
£
£

Directors' emoluments
56,852
95,071

Company contributions to defined contribution pension schemes
13,773
5,105

70,625
100,176


Page 21

 
RED MIST LEISURE LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 26 DECEMBER 2021

11.


Interest receivable

26 December
7 months ended
27 December
2021
2020
£
£


Other interest receivable
121
-

121
-


12.


Interest payable and similar expenses

26 December
7 months ended
27 December
2021
2020
£
£


Bank interest payable
-
212,822

Other loan interest payable
27,924
1,960

Other interest payable
1,102
-

29,026
214,782

Page 22

 
RED MIST LEISURE LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 26 DECEMBER 2021

13.


Taxation


26 December
7 months ended
27 December
2021
2020
£
£

Corporation tax


Current tax on profits for the year
(51,948)
58,768

Adjustments in respect of previous periods
8,827
-


(43,121)
58,768


Total current tax
(43,121)
58,768

Deferred tax


Origination and reversal of timing differences
146,694
67,409

Total deferred tax
146,694
67,409


Taxation on profit on ordinary activities
103,573
126,177
Page 23

 
RED MIST LEISURE LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 26 DECEMBER 2021
 
13.Taxation (continued)


Factors affecting tax charge for the period

The tax assessed for the period is the same as (2020 - the same as) the standard rate of corporation tax in the UK of 19% (2020 - 19%) as set out below:

26 December
7 months ended
27 December
2021
2020
£
£


(Loss)/profit on ordinary activities before tax
(947,898)
181,161


(Loss)/profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 19% (2020 - 19%)
(180,101)
34,421

Effects of:


Expenses not deductible for tax purposes, other than goodwill amortisation and impairment
23,237
1,696

Fixed asset differences
153,358
71,857

Deferred tax not recognised
-
18,203

Adjustments to tax charge in respect of prior periods
8,827
-

Remeasurement of deferred tax for changes in tax rates
96,232
-

Other differences leading to an increase (decrease) in the tax charge
2,020
-

Total tax charge for the period
103,573
126,177


Factors that may affect future tax charges

The corporation tax rate has increased from 19% to 25% from 1 April 2023 for companies making more than £250,000 profit.

Page 24

 
RED MIST LEISURE LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 26 DECEMBER 2021

14.


Intangible assets






Goodwill

£



Cost


At 28 December 2020
495,000



At 26 December 2021

495,000



Amortisation


At 28 December 2020
337,750


Charge for the period on owned assets
28,064



At 26 December 2021

365,814



Net book value



At 26 December 2021
129,186



At 27 December 2020
157,250



Page 25

 
RED MIST LEISURE LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 26 DECEMBER 2021

15.


Tangible fixed assets







Freehold property
Long-term leasehold property
Fixtures and fittings
Computer equipment
Equipment
Total

£
£
£
£
£
£



Cost or valuation


At 28 December 2020
8,459,938
1,583,455
4,035,727
-
1,505,971
15,585,091


Additions
360,684
29,923
114,997
40,758
178,334
724,696


Transfers between classes
-
714,281
(714,281)
-
-
-


Revaluations
4,991,633
-
-
-
-
4,991,633



At 26 December 2021

13,812,255
2,327,659
3,436,443
40,758
1,684,305
21,301,420



Depreciation


At 28 December 2020
189,202
121,101
1,833,935
-
937,432
3,081,670


Charge for the period on owned assets
83,795
215,488
190,685
6,891
197,977
694,836


Transfers between classes
-
41,666
(41,666)
-
-
-


Impairment charge
-
339,434
79,630
-
29,696
448,760


On revalued assets
(272,915)
-
-
-
-
(272,915)



At 26 December 2021

82
717,689
2,062,584
6,891
1,165,105
3,952,351



Net book value



At 26 December 2021
13,812,173
1,609,970
1,373,859
33,867
519,200
17,349,069



At 27 December 2020
8,270,736
1,462,354
2,201,792
-
568,539
12,503,421

Page 26

 
RED MIST LEISURE LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 26 DECEMBER 2021

Management undertook a review of fixed assets and have identified that assets classified as fixtures and fittings with a carrying value of £672,615 at the start of the year should be reclassified as leasehold property.  Accordingly these assets have been transferred between classes in order to provide a more true and fair presentation of the company's assets.
The freehold properties have been valued as fully equipped operational sites on the basis of their trading potential as at 31 December 2021 by CBRE at £14,675,000, and incorporated into the financial statements at £13,798,025 to allow for the estimated value of those assets held as fixtures, fittings and equipment included within the valuation.  In additional there are assets with a carrying value at the balance sheet date of £14,148 where no revaluation has been made as any difference to fair value is considered by management to be immaterial.

If the land and buildings had not been included at valuation they would have been included under the historical cost convention as follows:

26 December
27 December
2021
2020
£
£



Cost
8,782,435
-

Accumulated depreciation
(272,997)
-

Net book value
8,509,438
-


16.


Stocks

26 December
27 December
2021
2020
£
£

Goods for resale
179,700
115,757

179,700
115,757



17.


Debtors

26 December
27 December
2021
2020
£
£


Trade debtors
25,306
21,098

Amounts owed by group undertakings
2,484,153
-

Other debtors
88,077
227,766

Prepayments and accrued income
137,351
122,917

2,734,887
371,781

Page 27

 
RED MIST LEISURE LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 26 DECEMBER 2021

17.Debtors (continued)


Page 28

 
RED MIST LEISURE LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 26 DECEMBER 2021

18.


Cash and cash equivalents

26 December
27 December
2021
2020
£
£



Bank and cash balances
296,408
40,055

296,408
40,055


19.


Creditors: Amounts falling due within one year

26 December
27 December
2021
2020
£
£

Bank overdrafts
-
115,426

Bank loans
126,703
7,120,222

Other loans
-
73,285

Trade creditors
864,075
584,281

Amounts owed to group undertakings
11,875,191
2,819,455

Corporation tax
-
110,877

Other taxation and social security
400,435
117,624

Obligations under finance lease and hire purchase contracts
-
58,258

Other creditors
404,253
341,343

Accruals and deferred income
1,331,335
231,562

15,001,992
11,572,333


At the previous balance sheet date the company had breached the loan covenants and therefore all bank loans were classified as current liabilities. The company's bank loans were repaid in full in the year.


20.


Creditors: Amounts falling due after more than one year

26 December
27 December
2021
2020
£
£

Other loans
162,200
390,565

Net obligations under finance leases and hire purchase contracts
-
60,080

162,200
450,645


Page 29

 
RED MIST LEISURE LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 26 DECEMBER 2021

21.


Hire purchase and finance leases


Minimum lease payments under hire purchase fall due as follows:

26 December
27 December
2021
2020
£
£


Within one year
-
58,258

Between 1-5 years
-
60,080

-
118,338


22.


Deferred taxation






2021


£






At beginning of year
(322,623)


Charged to profit or loss
(146,694)


Charged to other comprehensive income
(1,316,137)



At end of year
(1,785,454)

The provision for deferred taxation is made up as follows:

26 December
27 December
2021
2020
£
£


Accelerated capital allowances
(408,474)
(212,796)

Deferred tax - rolled over gain into long leasehold assets
(55,813)
(42,418)

Timing differences
(5,030)
(67,409)

Unrealised capital gains
(1,316,137)
-

(1,785,454)
(322,623)

Page 30

 
RED MIST LEISURE LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 26 DECEMBER 2021

23.


Share capital

26 December
27 December
2021
2020
£
£
Authorised, allotted, called up and fully paid



648 (2020 - 648) Ordinary A shares of £1 each shares of £1 each
648
648
582 (2020 - 582) Ordinary B shares £1 each shares of £1 each
582
582
199 (2020 - 199) Ordinary C shares £1 each shares of £1 each
199
199
80 (2020 - 80) Ordinary D shares £1 each shares of £1 each
80
80
80 (2020 - 80) Ordinary E shares of £1 each shares of £1 each
80
80

1,589

1,589



24.


Reserves

Share premium account

This reserve records the amount above the nominal value received for shares sold.

Revaluation reserve

The revaluation reserve arose on the revaluation of freehold land and buildings and includes the associated deferred tax related to the revalued assets. Amounts representing the movements on the associated deferred tax are transferred to retained earnings each year.

Profit and loss account

The profit and loss account includes all current and prior period retained profits and losses less dividends paid.


25.


Contingent liabilities

The company is party to a cross-guarantee and fixed and floating charge in respect of borrowings undertaken by fellow group undertakings.


26.


Pension commitments

The company operates a defined contribution pension scheme. The pension cost charge represents contributions payable by the Company to the fund and amounted to £74,765 (2020: £31,069) . Contributions totalling £20,120 (2020: £24,137) were payable to the fund at the reporting date and are included in creditors.

Page 31

 
RED MIST LEISURE LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 26 DECEMBER 2021

27.


Commitments under operating leases

At 26 December 2021 the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:

26 December
27 December
2021
2020
£
£


Not later than 1 year
175,000
175,000

Later than 1 year and not later than 5 years
539,082
623,849

Later than 5 years
1,540,110
1,629,863

2,254,192
2,428,712

In addition to the minimum lease payments above, the company also pays contingent rents at one site dependent on reported turnover.


28.


Related party transactions

Transactions and balances with group entities
At the balance sheet date, the Company has intercompany balances outstanding from and to fellow group subsidiaries of Red Lion Holdings LLP.  This included the following:
Red Lion Holdings 1 Limited - £166,350 was due from the Company.
Red Lion Operations 2 Limited - £83,313 was due to the Company.
Red Lion Operations 3 Limited - £487,063 was due to the Company.
Red Lion Holdings 2 Limited - £221,040 was due from the Company.
Red Mist Holdings Limited - £11,708,721 was due from the Company.
Red Mist Parrot Inn Limited ("RMPI") - During the year the Company recharged expenditure totalling £76,830 to RMPI. At the balance sheet date £792,413 was due to the Company.
NDPC Limited  (formerly Red Mist Rose and Crown Limited) - During the year the Company recharged costs to NDPC Limited for staff totalling £232,853 and for other expenditure totalling £143,326.  At the balance sheet date £51,342 was due to the Company.
Red Mist Pubs Limited - £57,567 was due to the Company.
Grosvenor Pubs Trading Limited ("GPTL") - During the year the Company recharged expenditure toalling £136,328 to GPTL.  At the balance sheet date £24,538 was due to the Company.
Red Lion Management and Adminstration Limited - £763,263 was due to the Company.
Taste Food Solutions Limited ("TFSL")
TFSL is a private limited company controlled by the directors of the Company.  During the year the Company purchased goods from TFSL totalling £125,291.  At the balance sheet date £6,978 was due to TFSL from the Company.
Spendid Management Services Limited ("SMSL")
SMSL is a private limited company controlled by the directors of the Company.  During the year SMSL invoiced the company amounts totalling £6,291.  At the balance sheet date £7,549 was due to SMSL from the Company.

Page 32

 
RED MIST LEISURE LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 26 DECEMBER 2021

29.


Post balance sheet events

On 1 July 2022, 38.41% of the ordinary share capital in the immediate parent undertaking, Red Mist Holdings Limited ("RMH") was acquired by Red Lion Holdings 2 Limited ("RLH2"), a wholly owned company of the group for consideration of £5,290,978.
This transaction was partly settled by the transfer of the trade and assets of three pub sites from Red Mist Leisure Limited to NDPC Limited (formerly Red Mist Rose and Crown Limited), a fellow group subsidiary up to 1 July 2022.
The sites transferred consisted of The Royal Exchange in Lindford, Bordon, The Red Lion in Hook and The Castle Inn in Farnham, Surrey.  The consideration paid to the Company for these transfers was £4,025,000 via an interest-free loan, payable on demand, provided by RLH2. 
On 2 December 2022, the group sold The Temple Inn in Liss, which had been operated by the Company.
On 29 December 2022, the Company sold the Stag on The River in Eashing to Red Lion Operations 1 Limited ("RLO1"), a fellow subsidiary of the group, for consideration of £3.4m satisfied by an intercompany debt of the same amount.  On the same day, the Company directed that monies receivable from RLO1 of £3.4m should be directed to RMH in order to satisfy existing debt.


30.


Controlling party

The Company’s immediate parent is Red Mist Holdings Limited and the the ultimate parent entity is Red Lion Holdings LLP, a limited liability partnership incorporated in England and Wales. The registered office address of Red Lion Holdings LLP is The Wool Barn, Peper Harow, Godalming, Surrey, GU8 6BQ. The smallest and largest group of which the Company is a member and for which group accounts are prepared is Red Lion Holdings LLP. Copies of these accounts are available from Companies House.
It is the opinion of the directors that there is no single controlling party of the company.

Page 33