Caseware UK (AP4) 2022.0.179 2022.0.179 2023-01-312023-01-3161truetruetruefalsetruetruetrue2022-02-01false71 11139452 2022-02-01 2023-01-31 11139452 2021-02-01 2022-01-31 11139452 2023-01-31 11139452 2022-01-31 11139452 2021-02-01 11139452 c:RestatedAmount 2022-01-31 11139452 1 2022-02-01 2023-01-31 11139452 1 2021-02-01 2022-01-31 11139452 5 2022-02-01 2023-01-31 11139452 5 2021-02-01 2022-01-31 11139452 e:CompanySecretary1 2022-02-01 2023-01-31 11139452 e:Director1 2022-02-01 2023-01-31 11139452 e:Director2 2022-02-01 2023-01-31 11139452 e:Director3 2022-02-01 2023-01-31 11139452 e:RegisteredOffice 2022-02-01 2023-01-31 11139452 c:Buildings 2022-02-01 2023-01-31 11139452 c:Buildings 2023-01-31 11139452 c:Buildings 2022-01-31 11139452 c:Buildings c:OwnedOrFreeholdAssets 2022-02-01 2023-01-31 11139452 c:PlantMachinery 2022-02-01 2023-01-31 11139452 c:PlantMachinery 2023-01-31 11139452 c:PlantMachinery 2022-01-31 11139452 c:PlantMachinery c:OwnedOrFreeholdAssets 2022-02-01 2023-01-31 11139452 c:MotorVehicles 2022-02-01 2023-01-31 11139452 c:MotorVehicles 2023-01-31 11139452 c:MotorVehicles 2022-01-31 11139452 c:MotorVehicles c:OwnedOrFreeholdAssets 2022-02-01 2023-01-31 11139452 c:OwnedOrFreeholdAssets 2022-02-01 2023-01-31 11139452 c:CurrentFinancialInstruments 2023-01-31 11139452 c:CurrentFinancialInstruments 2022-01-31 11139452 c:CurrentFinancialInstruments c:WithinOneYear 2023-01-31 11139452 c:CurrentFinancialInstruments c:WithinOneYear 2022-01-31 11139452 c:ReportableOperatingSegment1 2022-02-01 2023-01-31 11139452 c:ReportableOperatingSegment1 2021-02-01 2022-01-31 11139452 c:ReportableOperatingSegment2 2022-02-01 2023-01-31 11139452 c:ReportableOperatingSegment2 2021-02-01 2022-01-31 11139452 c:UKTax 2022-02-01 2023-01-31 11139452 c:UKTax 2021-02-01 2022-01-31 11139452 c:ShareCapital 2022-02-01 2023-01-31 11139452 c:ShareCapital 2023-01-31 11139452 c:ShareCapital 2021-02-01 2022-01-31 11139452 c:ShareCapital 2022-01-31 11139452 c:ShareCapital 2021-02-01 11139452 c:RevaluationReserve 2022-02-01 2023-01-31 11139452 c:RevaluationReserve 2023-01-31 11139452 c:RevaluationReserve 5 2022-02-01 2023-01-31 11139452 c:RevaluationReserve 2021-02-01 2022-01-31 11139452 c:RevaluationReserve 2022-01-31 11139452 c:RevaluationReserve c:RestatedAmount 2022-01-31 11139452 c:RevaluationReserve 2021-02-01 11139452 c:RevaluationReserve 5 2021-02-01 2022-01-31 11139452 c:RetainedEarningsAccumulatedLosses 2022-02-01 2023-01-31 11139452 c:RetainedEarningsAccumulatedLosses 2023-01-31 11139452 c:RetainedEarningsAccumulatedLosses 2021-02-01 2022-01-31 11139452 c:RetainedEarningsAccumulatedLosses 2022-01-31 11139452 c:RetainedEarningsAccumulatedLosses c:RestatedAmount 2022-01-31 11139452 c:RetainedEarningsAccumulatedLosses 2021-02-01 11139452 c:AcceleratedTaxDepreciationDeferredTax 2023-01-31 11139452 c:AcceleratedTaxDepreciationDeferredTax 2022-01-31 11139452 c:TaxLossesCarry-forwardsDeferredTax 2023-01-31 11139452 c:TaxLossesCarry-forwardsDeferredTax 2022-01-31 11139452 c:RetirementBenefitObligationsDeferredTax 2023-01-31 11139452 c:RetirementBenefitObligationsDeferredTax 2022-01-31 11139452 c:OtherDeferredTax 2023-01-31 11139452 c:OtherDeferredTax 2022-01-31 11139452 e:OrdinaryShareClass1 2022-02-01 2023-01-31 11139452 e:OrdinaryShareClass1 2023-01-31 11139452 e:FRS102 2022-02-01 2023-01-31 11139452 e:Audited 2022-02-01 2023-01-31 11139452 e:FullAccounts 2022-02-01 2023-01-31 11139452 e:PrivateLimitedCompanyLtd 2022-02-01 2023-01-31 11139452 5 2022-02-01 2023-01-31 11139452 7 2022-02-01 2023-01-31 11139452 c:RevaluationReserve c:PriorPeriodErrorIncreaseDecrease 2022-02-01 2023-01-31 11139452 c:RetainedEarningsAccumulatedLosses c:PriorPeriodErrorIncreaseDecrease 2022-02-01 2023-01-31 11139452 c:PriorPeriodErrorIncreaseDecrease 2022-02-01 2023-01-31 iso4217:GBP xbrli:shares xbrli:pure

Registered number: 11139452










PALACE LAUNDRY LTD










ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 JANUARY 2023

 
PALACE LAUNDRY LTD
 
 
COMPANY INFORMATION


Directors
T J R Kemp 
R Cheles 
C A Markham 




Company secretary
M T Soden



Registered number
11139452



Registered office
18 Thurloe Place
London

SW7 2SP




Independent auditors
MHA
Statutory Auditor

6th Floor

2 London Wall Place

London

EC2Y 5AU





 
PALACE LAUNDRY LTD
 

CONTENTS



Page
Strategic report
1 - 2
Directors' report
3 - 4
Independent auditors' 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 - 24

 
PALACE LAUNDRY LTD
 
 
STRATEGIC REPORT
FOR THE YEAR ENDED 31 JANUARY 2023

Introduction
 
The directors present their report and the audited financial statements for the year ended 31 January 2023.

Business review
 
The principal activity of the company is to provide premium quality laundry and dry cleaning services to the eight London hotels owned and operated by the Firmdale Group of Companies and some 15 third party clients.
It operates from a purpose built facility in Fulham, London SW6 and services the various hotel properties daily using a fleet of vans. Ongoing investment in equipment ensures both high staff productivity and also minimal use of water, gas and detergent. 
The laundry operation benefits from a highly motivated and experienced team of employees. Such is the reputation and standing of the service that new contracts are regularly declined due to capacity constraints.
Despite a significant trading improvement to the prior year, the company suffered a loss of £1,208,318 (2022: profit of £729,953). EBITDA before property revaluation adjustments was positive £30,605 (2022 - negative £332,124). 

Principal risks and uncertainties
 
The principal financial risks faced by the company, and the company's objectives and policies in relation to those
risks are as follows:

Cash flow risk
The finance department closely manages the company's cash flow. Detailed cash flow forecasts are regularly  prepared with the objective of alerting the directors to potential future risks. It is the company's policy to ensure that forecast funding requirements can be met with available committed facilities

Credit risk
Credit risk is the financial exposure generated by the potential default of third parties in fulfilling their obligations. Credit risk arises for the company if it is unable to recover sums due from clients and it is mitigated by setting maximum levels of credit tolerance for more significant clients.

Financial key performance indicators
 
Total revenues for the year were £2.9m (2022 - £1.2m) an increase of 2.4 fold over prior year.

Page 1

 
PALACE LAUNDRY LTD
 

STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023

Going concern

The directors view the cashflows and liabilities of Firmdale Holdings Ltd and its subsidiaries (“the Group”) as a whole in making assessments of the group’s ability to meet its liabilities as they fall due. Therefore, as part of their assessment of going concern, the directors of the company have considered the funding and liquidity position of the Group to determine the appropriateness of preparing the financial statements on a going concern basis. 
The outbreak of the global Covid-19 pandemic in early 2020 had a very significant impact on the operations of the group in common with the majority of businesses worldwide, and the hospitality sector in particular. Following the elimination of all material UK restrictions with effect from 19th July 2021, and the gradual restoration of international travel thereafter, trading demand recovered quickly and since March 2022 both Revenues and Earnings have exceeded those achieved in pre-Covid 2019, a significant milestone in recovery. The continuing growth led to record profitability for the Group in the financial year to January 2023. Furthermore, rising interest rates have not had a significant impact on the Group given that 67% of group debt is fixed and a further 31% has the benefit of an interest rate cap should LIBOR exceed 3.5%. 
The trading results for the first six months of the new financial year are slightly ahead of budget and the outlook for the remainder of the year and beyond remains positive. The lenders remained very supportive during the Covid period and the relationships remain strong with comfortable delivery of financial covenant hurdles now firmly re-established. 
The Board will continue to monitor developments closely and adjust their forecasting assumptions as required, but have a high degree of confidence that the company will be able to meet its liabilities as they fall due and meet its covenant obligations for a period of at least twelve months. The Directors have therefore concluded that the company can continue to adopt the going concern basis in preparing the annual report and accounts.
Despite generating a loss before tax in the year to 31 January 2023 of £1,208,318 and net current liabilities at the reporting date of £8,902,963, the directors consider the company to remain a going concern. The net current liabilities position is largely driven by amounts due to fellow companies, who have confirmed this amount will not be recalled to the detriment of other creditors or the operations of the company. Operating loss before property revaluations for the reporting year was £399,818 in comparison to a loss of £717,423 in the year ended 31 January 2022, highlighting improved operating performance and the directors consider this function vital in supporting the activities of the wider Firmdale Group. The directors therefore consider the going concern basis to remain appropriate. 

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



T J R Kemp
Director

Date: 10 October 2023
Page 2

 
PALACE LAUNDRY LTD
 
 
 
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 JANUARY 2023

The directors present their report and the financial statements for the year ended 31 January 2023.

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 principal activity of the company is that of laundry and dry cleaning services.

Results and dividends

The loss for the year, after taxation, amounted to £1,260,215 (2022 - profit £297,377).

The directors do not recommend the payment of a dividend (2022 - £Nil). 

Directors

The directors who served during the year were:

T J R Kemp 
R Cheles 
C A Markham 

Future developments

There are no key future developments anticipated to the Company's usual trade.

Page 3

 
PALACE LAUNDRY LTD
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023

Qualifying third party indemnity provisions

Third party qualifying directors' and officers’ insurance has been maintained throughout the financial year and to the date of this report which extends to all subsidiaries within the wider group under Firmdale Holdings Limited.

Disclosure of information to auditors

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 auditors are 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 auditors are aware of that information.

Post balance sheet events

There have been no significant events affecting the Company since the year end.

Auditors

Following a rebranding exercise on 15 May 2023 the trading name of the company's independent auditor changed from MHA MacIntyre Hudson to MHA. A resolution to reappoint MHA as independent auditor will be proposed at the next Annual General Meeting.

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





T J R Kemp
Director

Date: 10 October 2023
Page 4

 
PALACE LAUNDRY LTD
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF PALACE LAUNDRY LTD
 

Opinion


We have audited the financial statements of Palace Laundry Ltd (the 'Company') for the year ended 31 January 2023, 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 31 January 2023 and of its loss for the year 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 Auditors' 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

 
PALACE LAUNDRY LTD
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF PALACE LAUNDRY LTD (CONTINUED)


Other information


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.


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 year 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.
Page 6

 
PALACE LAUNDRY LTD
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF PALACE LAUNDRY LTD (CONTINUED)


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.


Auditors' 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 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 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:
enquiry of management, those charged with governance and Company legal advisors around actual and potential litigation and claims;

performing audit work over the risk and management override of controls, including testing of journal entries and other adjustments for appropriateness, evaluating the business rationale of significant transactions outside the normal course of business and reviewing accounting estimates for bias;

reviewing minutes of meetings of those charged with governance; and

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


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 Auditors' report.


Page 7

 
PALACE LAUNDRY LTD
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF PALACE LAUNDRY LTD (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 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.





Rajeev Shaunak FCA (Senior Statutory Auditor)
  
for and on behalf of
MHA
 
Statutory Auditor
  
London, United Kingdom

19 October 2023
MHA is the trading name of MacIntyre Hudson LLP, a limited liability partnership in England and Wales  (registered number OC312313).
Page 8

 
PALACE LAUNDRY LTD
 
 
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 JANUARY 2023

As restated
2023
2022
Note
£
£

  

Turnover
 4 
2,897,776
1,205,691

Cost of sales
  
(2,193,077)
(1,445,801)

Gross profit/(loss)
  
704,699
(240,110)

Administrative expenses
  
(1,104,517)
(863,727)

Other operating income
 5 
-
386,414

Revaluation decrease in excess of revaluation gains / Reversal of revaluation decrease previously recognised in profit or loss
  
(808,500)
1,447,376

Operating (loss)/profit
  
(1,208,318)
729,953

Tax on (loss)/profit
 8 
(51,897)
(432,576)

(Loss)/profit for the financial year
  
(1,260,215)
297,377

Other comprehensive income for the year
  

Unrealised (deficit)/surplus on revaluation of tangible fixed assets
  
(169,822)
173,200

Total comprehensive income for the year
  
(1,430,037)
470,577

The notes on pages 12 to 24 form part of these financial statements.
Page 9

 
PALACE LAUNDRY LTD
REGISTERED NUMBER: 11139452

STATEMENT OF FINANCIAL POSITION
AS AT 31 JANUARY 2023

As restated
2023
2022
Note
£
£

Fixed assets
  

Tangible assets
 9 
6,324,105
7,545,887

Current assets
  

Debtors
 10 
364,895
127,829

Cash at bank and in hand
 11 
17,045
76,294

  
381,940
204,123

Creditors: amounts falling due within one year
 12 
(9,284,903)
(8,950,728)

Net current liabilities
  
 
 
(8,902,963)
 
 
(8,746,605)

Total assets less current liabilities
  
(2,578,858)
(1,200,718)

Provisions for liabilities
  

Deferred tax
 13 
(986,981)
(935,084)

  
 
 
(986,981)
 
 
(935,084)

Net liabilities
  
(3,565,839)
(2,135,802)


Capital and reserves
  

Called up share capital 
 14 
100
100

Revaluation reserve
 15 
-
173,200

Profit and loss account
 15 
(3,565,939)
(2,309,102)

  
(3,565,839)
(2,135,802)


The financial statements were approved and authorised for issue by the board and were signed on its behalf by: 




T J R Kemp
Director

Date: 10 October 2023

Page 10

 
PALACE LAUNDRY LTD
 

STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 JANUARY 2023


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

£
£
£
£

At 1 February 2022 (as previously stated)
100
-
(2,135,902)
(2,135,802)

Prior year adjustment - correction of error (see Note 16)
-
173,200
(173,200)
-

At 1 February 2022 (as restated)
100
173,200
(2,309,102)
(2,135,802)



Loss for the year
-
-
(1,260,215)
(1,260,215)

Deficit on revaluation of freehold property
-
(169,822)
-
(169,822)
Total comprehensive income for the year
-
(169,822)
(1,260,215)
(1,430,037)

Transfer to/from profit and loss account
-
(3,378)
3,378
-


At 31 January 2023
100
-
(3,565,939)
(3,565,839)


The notes on pages 12 to 24 form part of these financial statements.


STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 JANUARY 2022


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

£
£
£
£

At 1 February 2021
100
-
(2,606,479)
(2,606,379)


Comprehensive income for the year

Profit for the year
-
-
297,377
297,377

Surplus on revaluation of freehold property
-
173,200
-
173,200
Total comprehensive income for the year
-
173,200
297,377
470,577


At 31 January 2022
100
173,200
(2,309,102)
(2,135,802)


The notes on pages 12 to 24 form part of these financial statements.
Page 11

 
PALACE LAUNDRY LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023

1.


General information

Palace Laundry Limited is a private company, limited by shares, registered and incorporated in England and Wales under the Companies Act. The company's registered office is 18 Thurloe Place, London, SW7 2SP. 
The principal activity of the company is that of laundry and dry cleaning services.
The Company's functional and presentational currency is pound sterling (GBP), rounded to the nearest £1.

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);
the requirements of Section 11 Financial Instruments paragraphs 11.42, 11.44 to 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b) and 11.48(c);
the requirements of Section 12 Other Financial Instruments paragraphs 12.26 to 12.27, 12.29(a), 12.29(b) and 12.29A;
the requirements of Section 33 Related Party Disclosures paragraph 33.7.

This information is included in the consolidated financial statements of Firmdale Holdings Limited as at 31 January 2023 and these financial statements may be obtained from the Registrar of Companies.

Page 12

 
PALACE LAUNDRY LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023

2.Accounting policies (continued)

 
2.3

Going concern

The directors view the cashflows and liabilities of Firmdale Holdings Ltd and its subsidiaries (“the Group”) as a whole in making assessments of the group’s ability to meet its liabilities as they fall due. Therefore, as part of their assessment of going concern, the directors of the company have considered the funding and liquidity position of the Group to determine the appropriateness of preparing the financial statements on a going concern basis. 
The outbreak of the global Covid-19 pandemic in early 2020 had a very significant impact on the operations of the group in common with the majority of businesses worldwide, and the hospitality sector in particular. Following the elimination of all material UK restrictions with effect from 19th July 2021, and the gradual restoration of international travel thereafter, trading demand recovered quickly and since March 2022 both Revenues and Earnings have exceeded those achieved in pre-Covid 2019, a significant milestone in recovery. The continuing growth led to record profitability for the Group in the financial year to January 2023. Furthermore, rising interest rates have not had a significant impact on the Group given that 67% of group debt is fixed and a further 31% has the benefit of an interest rate cap should LIBOR exceed 3.5%. 
The trading results for the first six months of the new financial year are slightly ahead of budget and the outlook for the remainder of the year and beyond remains positive. The lenders remained very supportive during the Covid period and the relationships remain strong with comfortable delivery of financial covenant hurdles now firmly re-established. 
The Board will continue to monitor developments closely and adjust their forecasting assumptions as required, but have a high degree of confidence that the company will be able to meet its liabilities as they fall due and meet its covenant obligations for a period of at least twelve months. The Directors have therefore concluded that the company can continue to adopt the going concern basis in preparing the annual report and accounts.
Despite generating a loss before tax in the year to 31 January 2023 of £1,208,318 and net current liabilities at the reporting date of £8,902,963, the directors consider the company to remain a going concern. The net current liabilities position is largely driven by amounts due to fellow companies, who have confirmed this amount will not be recalled to the detriment of other creditors or the operations of the company. Operating loss before property revaluations for the reporting year was £399,818 in comparison to a loss of £717,423 in the year ended 31 January 2022, highlighting improved operating performance and the directors consider this function vital in supporting the activities of the wider Firmdale Group. The directors therefore consider the going concern basis to remain appropriate. 

 
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, excluding discounts, rebates, value added tax and other sales taxes.

 
2.5

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.

Page 13

 
PALACE LAUNDRY LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023

2.Accounting policies (continued)


2.5
Tangible fixed assets (continued)

Land is not depreciated. Depreciation on other assets 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:

Freehold property
-
50 years straight line
Plant and machinery
-
15% straight line
Motor vehicles
-
25% straight line

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.

 
2.6

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 the statement of comprehensive income.

 
2.7

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.

 
2.8

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.

 
2.9

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.

Page 14

 
PALACE LAUNDRY LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023

2.Accounting policies (continued)

 
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.

 
2.11

Holiday pay accrual

A liability is recognised to the extent of any unused holiday pay entitlement which is accrued at the reporting date and carried forward to future periods. This is measured at the undiscounted salary cost of the future holiday entitlement so accrued at the reporting date.
To the extent that the holiday pay adjustments gives rise to an asset balance at the reporting date the amount is reported in prepayments.

 
2.12

Government grants

Government subsidies and grant income are recognised when there is reasonable assurance that the conditions attached to the income will be met and that the income will be received. The income is recognised in the statement of comprehensive income over the periods in which the company incurs expenses for which the subsidies or grants are intended to compensate. In the prior financial year, under FRS102 reporting standards, the company has included its income from the Government's Coronavirus Job Retention Scheme within other income.

 
2.13

Current and deferred taxation

The tax expense for the year 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
Page 15

 
PALACE LAUNDRY LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023

2.Accounting policies (continued)


2.13
Current and deferred taxation (continued)

using tax rates and laws that have been enacted or substantively enacted by the reporting date.

 
2.14

Provisions for liabilities

Provisions are made where an event has taken place that gives the Company a legal or constructive obligation that probably requires settlement by a transfer of economic benefit, and a reliable estimate can be made of the amount of the obligation.
Provisions are charged as an expense to profit or loss in the year that the Company 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.

 
2.15

Financial instruments

The company has elected to apply the provisions of Section 11 'Basic Financial Instruments' and  Section 12 'Other Financial Instruments Issues' of FRS 102 to all of its financial instruments.
The Company only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in ordinary shares.

Debt instruments (other than those wholly repayable or receivable within one year), including loans and other accounts receivable and payable, are initially measured at present value of the future cash flows and subsequently at amortised cost using the effective interest method. Debt instruments that are payable or receivable within one year, typically trade debtors and creditors, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received. However, if the arrangements of a short-term instrument constitute a financing transaction, like the payment of a trade debt deferred beyond normal business terms or in case of an out-right short-term loan that is not at market rate, the financial asset or liability is measured, initially at the present value of future cash flows discounted at a market rate of interest for a similar debt instrument and subsequently at amortised cost, unless it qualifies as a loan from a director in the case of a small company, or a public benefit entity concessionary loan.

Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the Statement of comprehensive income.

For financial assets measured at amortised cost, the impairment loss is measured as the difference between an asset's carrying amount and the present value of estimated cash flows discounted at the asset's original effective interest rate. If a financial asset has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate determined under the contract.

For financial assets measured at cost less impairment, the impairment loss is measured as the difference between an asset's carrying amount and best estimate of the recoverable amount, which is an approximation of the amount that the Company would receive for the asset if it were to be sold at the reporting date.

Page 16

 
PALACE LAUNDRY LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023

2.Accounting policies (continued)


2.15
Financial instruments (continued)

Financial assets and liabilities are offset and the net amount reported in the Statement of financial position when there is an 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.


3.


Judgements in applying accounting policies and key sources of estimation uncertainty

The following judgements (including the key areas of estimation uncertainty) have had the most significant effect on amounts recognised in the financial statements:
Revaluation of tangible fixed assets
The freehold property is held under the revaluation model based on the directors' conclusions, having consulted and reviewed the previous valuations completed by independent valuation specialists. These valuers hold recognised and relevant professional qualifications. The valuations are based on discounted cash flow models which include judgements surrounding future performance and market factors.


4.


Turnover

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


2023
2022
£
£

Laundry services
1,966,297
769,662

Dry cleaning services
931,479
436,029

2,897,776
1,205,691


All turnover arose within the United Kingdom.


5.


Other operating income

2023
2022
£
£

Government grants receivable
-
386,414


Page 17

 
PALACE LAUNDRY LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023

6.


Auditors' remuneration

During the year, the Company obtained the following services from the Company's auditors:


2023
2022
£
£

Fees payable to the Company's auditors for the audit of the Company's financial statements
12,500
10,000

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.


7.


Employees

Staff costs were as follows:


2023
2022
£
£

Wages and salaries
1,522,303
1,062,549

Social security costs
134,412
83,924

Cost of defined contribution scheme
26,991
17,795

1,683,706
1,164,268


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


        2023
        2022
            No.
            No.







Directors
3
3



Operational Staff
68
58

71
61

Page 18

 
PALACE LAUNDRY LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023

8.


Taxation


2023
2022
£
£

Corporation tax


Current tax on loss for the year
-
(1,679)


-
(1,679)


Total current tax
-
(1,679)

Deferred tax


Origination and reversal of timing differences
51,897
276,098

Effect of tax rate change on opening balance
-
158,157

Total deferred tax
51,897
434,255


Taxation on profit on ordinary activities
51,897
432,576
Page 19

 
PALACE LAUNDRY LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023
 
8.Taxation (continued)


Factors affecting tax charge for the year

The tax assessed for the year is lower than (2022 - higher than) the standard rate of corporation tax in the UK of 19% (2022 - 19%). The differences are explained below:

2023
2022
£
£


(Loss)/profit on ordinary activities before tax
(1,208,318)
729,953


(Loss)/profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 19% (2022 - 19%)
(229,580)
138,691

Effects of:


Fixed asset differences
-
56,016

Expenses not deductible for tax purposes, other than goodwill amortisation and impairment
176,734
(19,459)

Capital allowances for year in excess of depreciation
-
224,420

Utilisation of tax losses surrendered to group companies
257,255
-

Super-deduction expenditure adjustment
(11,671)
-

Adjustments to tax charge in respect of prior periods
(24,791)
-

Revaluation of freehold property
(209,000)
-

Deferred tax recognised at a higher rate
18,405
-

Other differences leading to an increase (decrease) in the tax charge
-
32,908

Group relief surrendered
74,545
-

Total tax charge for the year
51,897
432,576


Factors that may affect future tax charges

The standard rate of corporation tax in the UK has increased on a sliding scale based on profits from 19% to 25%, effective from 1 April 2023.

Page 20

 
PALACE LAUNDRY LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023

9.


Tangible fixed assets





Freehold property
Plant and machinery
Motor vehicles
Total

£
£
£
£



Cost or valuation


At 1 February 2022
6,400,000
1,964,819
19,169
8,383,988


Additions
-
186,963
-
186,963


Revaluations
(1,100,000)
-
-
(1,100,000)



At 31 January 2023

5,300,000
2,151,782
19,169
7,470,951



Depreciation


At 1 February 2022
-
818,932
19,169
838,101


Charge for the year on owned assets
121,678
308,745
-
430,423


On revalued assets
(121,678)
-
-
(121,678)



At 31 January 2023

-
1,127,677
19,169
1,146,846



Net book value



At 31 January 2023
5,300,000
1,024,105
-
6,324,105



At 31 January 2022
6,400,000
1,145,887
-
7,545,887

The freehold property was valued by the directors, with support of Cushman & Wakefield, Chartered Surveyors, an independent valuer with a recognised and relevant professional qualification and with recent experience in the location and category of the property being valued. A formal valuation was carried out at the previous reporting date, 31 January 2022 and since then an assessment has been carried out by the directors with guidance from Cushman & Wakefield as at 31 January 2023, on the basis of fair value in accordance with the Appraisal and Valuation Manual of The Royal Institution of Chartered Surveyors.

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

2023
2022
£
£



Cost
6,700,000
6,700,000

Accumulated depreciation
(591,500)
(473,200)

Net book value
6,108,500
6,226,800

Page 21

 
PALACE LAUNDRY LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023

10.


Debtors

2023
2022
£
£

Trade debtors
335,399
99,748

Other debtors
-
100

Prepayments
29,496
27,981

364,895
127,829



11.


Cash and cash equivalents

2023
2022
£
£

Cash at bank and in hand
17,045
76,294



12.


Creditors: Amounts falling due within one year

2023
2022
£
£

Trade creditors
17,880
23,566

Amounts owed to group undertakings
9,061,710
8,719,584

Other taxation and social security
100,889
81,338

Other creditors
7,166
5,701

Accruals
97,258
120,539

9,284,903
8,950,728


Amounts owed to group undertakings are unsecured, interest-free and are repayable on demand.


13.


Deferred taxation




2023
2022


£

£






At beginning of year
(935,084)
(500,829)


Charged to profit or loss
(51,897)
(434,255)



At end of year
(986,981)
(935,084)

Page 22

 
PALACE LAUNDRY LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023
 
13.Deferred taxation (continued)

The provision for deferred taxation is made up as follows:

2023
2022
£
£


Fixed asset timing differences
(13,950)
(420)

Short term timing differences
1,618
1,287

Temporary difference on the revaluation of freehold property
(1,002,090)
(1,297,514)

Losses and other deductions
27,441
361,563

986,981
935,084


14.


Share capital

2023
2022
£
£
Allotted, called up and fully paid



100 (2022 - 100) Ordinary shares of £1.00 each
100
100

The ordinary shares have attached to them full voting, dividend and capital distribution (including on winding up) rights; they do not confer any rights of redemption.



15.


Reserves

Revaluation reserve

This reserve records the amount above the historic cost of tangible fixed assets. The amount of depreciation provided on book value which represents a surplus on valuation is transferred as a reserves movement to the profit and loss account. 

Profit and loss account

Profit and loss account represents cumulative profits or losses, net of dividends paid and other adjustments

Page 23

 
PALACE LAUNDRY LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023

16.


Prior year adjustment

A prior year adjustment has been processed in relation to the revaluation of freehold property and associated movements to correct the position between the Revaluation reserve and Profit and loss account.
For the year ended 31 January 2022, which is the earliest and only material prior period correction presented, an increase in depreciation expense of £8,876 was recorded, alongside an associated revaluation reversal to the profit or loss account for the same amount. A further reclassification of £173,200 was processed between 'Reversals of revaluation decreases previously recognised in profit or loss' to 'Unrealised surplus on revaluation of tangible fixed assets' in the Statement of comprehensive income. 


17.


Pension commitments

The company operates a defined contribution scheme for employees. The assets of the scheme are held separately from those of the company in independently administered funds. The pension cost charge for the year represents contributions payable by the company to the funds and amounted to £26,991 (2022 - £17,795). Included in other creditors are contributions totalling £7,166 (2022 - £5,149) which were payable to the fund at the reporting date.


18.


Related party transactions

The company has taken advantage of the exemption available under paragraph 33.1A of the Financial Reporting Standard 102 not to disclose transactions with other wholly owned members of the group.


19.


Controlling party

The immediate and ultimate parent and controlling company is Firmdale Holdings Limited, a company registered in England and Wales.
The company is included within the consolidation of the Firmdale Holdings Limited group and this is the parent of the smallest and largest group which draws up consolidated financial statements. Firmdale Holdings Limited registered office address is 18 Thurloe Place, London, SW7 2SP. The consolidated accounts of this group are publicly available from the Registrar of Companies.
 
Page 24