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Registered number: 13950011










SK JV BIDCO LIMITED

AUDITED
DIRECTORS' REPORT
AND FINANCIAL STATEMENTS

FOR THE PERIOD ENDED
31 DECEMBER 2022
 






 



 






 
SK JV BIDCO LIMITED
 

COMPANY INFORMATION


Directors
Mr C J Ferguson-Davie (appointed 2 March 2022)
Mr M E C Gilbard (appointed 2 March 2022)
Mr R Greenwood (appointed 2 March 2022)
Mr S Hall (appointed 2 March 2022)
Mr S J Horton (appointed 2 March 2022)




Registered number
13950011



Registered office
127a High Street
Ruislip

Middlesex

HA4 8JN




Independent auditors
BDO LLP

55 Baker Street

London

W1U 7EU





 
SK JV BIDCO LIMITED
 

CONTENTS



Page
Directors' Report
 
 
1 - 2
Independent Auditors' Report
 
 
3 - 6
Consolidated Statement of Comprehensive Income
 
 
7
Consolidated Balance Sheet
 
 
8 - 9
Company Balance Sheet
 
 
10
Consolidated Statement of Changes in Equity
 
 
11
Company Statement of Changes in Equity
 
 
12
Notes to the Financial Statements
 
 
13 - 25


 
SK JV BIDCO LIMITED
 

 
DIRECTORS' REPORT
FOR THE PERIOD ENDED 31 DECEMBER 2022

The Directors present their report and the financial statements for the period ended 31 December 2022.

Directors' responsibilities statement

The Directors are responsible for preparing the Directors' Report and the consolidated financial statements in accordance with applicable law and regulations.
 
Company law requires the Directors to prepare financial statements for each financial year. Under that law the Directors have elected to prepare the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and the Group and of the profit or loss of the Group for that period.

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


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

make judgements and accounting estimates that are reasonable and prudent;

state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and

prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group will continue in business.

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

The Company was incorporated on 2 March 2022 and began trading on that date.

Principal activity

The principal activity of the Group is the rental of storage units.

Results and dividends

The profit for the period, after taxation, amounted to £2,454,000.

No dividends were declared or paid in the period.

Directors

The Directors who served during the period were:

Mr C J Ferguson-Davie (appointed 2 March 2022)
Mr M E C Gilbard (appointed 2 March 2022)
Mr R Greenwood (appointed 2 March 2022)
Mr S Hall (appointed 2 March 2022)
Mr S J Horton (appointed 2 March 2022)

Page 1

 
SK JV BIDCO LIMITED
 

 
DIRECTORS' REPORT (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2022

Going concern

In reviewing the current financial position of the Group, the Directors have noted that at the reporting date the Group had net current liabilities of £13,617,000, net assets of £17,455,000, profit before tax for the year of £3,026,000 and cash generated from operations during the year of £2,266,000.
The Directors of the Group have prepared cash flow forecasts for a period of 12 months from the date of approval of these financial statements. Those cash flow forecasts show that the Group is able to continue to operate within the existing facilities available. The Directors have also given due consideration to the future plans for the Company, the profile of debt maturities and the covenants associated with the bank facility. In addition, the Directors of the Group have obtained a letter of support from the joint venture partners, MREF V Storage Holdings Limited and Stor-Age International (Pty) Ltd, which confirms that financial support will be provided, if required, to allow the the Group to meet its liabilities as they fall due for a period of at least 12 months from the approval of these financial statements.
As a result of this assessment, the Directors are confident about the ability of the Group to continue as a going concern. Thus, the Directors continue to adopt the going concern basis of accounting in preparing the annual financial statements.

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 and the Group'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 and the Group's auditors are aware of that information.

Auditors

The auditorsBDO LLP, were appointed in the period and will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

Small companies note

In preparing this report, the Directors have taken advantage of the small companies exemptions provided by section 415A of the Companies Act 2006.

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





Mr R Greenwood
Director

Date: 22 September 2023

Page 2

 
SK JV BIDCO LIMITED
 

 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SK JV BIDCO LIMITED
 

Opinion on the financial statements


In our opinion, the financial statements:


give a true and fair view of the state of the Group's and of the Parent Company's affairs as at 31 December 2022 and of the Group's profit for the period then ended;
the financial statements have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
the financial statements have been prepared in accordance with the requirements of the Companies Act 2006.


We have audited the financial statements of SK JV Bidco Limited (the 'Parent Company') and its subsidiaries (the 'Group') for the period from 2 March 2022 to 31 December 2022, which comprise the Consolidated Statement of Comprehensive Income, the Consolidated and Company Balance Sheets, the Consolidated and Company Statement of Changes in Equity and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).


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 believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Independence
 We are independent of the Group and the Parent 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. 


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 Group's or the Parent Company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.


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


Page 3

 
SK JV BIDCO LIMITED
 

 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SK JV BIDCO LIMITED (CONTINUED)


Other information


The Directors are responsible for the other information. The other information comprises the information included in the Audited Directors' Report and Financial Statements, other than the financial statements and  our auditors' report thereon. 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.


Other Companies Act 2006 reporting
 

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


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

In the light of the knowledge and understanding of the Group and the Parent Company and its environment obtained in the course of the audit, we have not identified material misstatements in the 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 by the parent Company, or returns adequate for our audit have not been received from branches not visited by us; or
the parent Company 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; or
the Directors were not entitled to prepare the financial statements in accordance with the small companies regime and take advantage of the small companies' exemptions in preparing the Directors' Report and from the requirement to prepare a Strategic Report.


Responsibilities of directors
 

As explained more fully in the Directors' Responsibilities Statement, the Directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the Directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.


In preparing the financial statements, the Directors are responsible for assessing the Group's and the Parent 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 Group or the Parent Company or to cease operations, or have no realistic alternative but to do so.


Page 4

 
SK JV BIDCO LIMITED
 

 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SK JV BIDCO LIMITED (CONTINUED)


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.


Extent to which the audit was capable of detecting irregularities, including fraud
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:
Non compliance with laws and regulations
Based on:
 
Our understanding of the Group and the industry in which it operates;
Discussion with management and those charged with governance; and
Obtaining and understanding of the Group’s policies and procedures regarding compliance with laws and regulations.

We considered the significant laws and regulations to be the applicable accounting standards and the Companies Act 2006.
The Group is also subject to laws and regulations where the consequence of non-compliance could have a material effect on the amount or disclosures in the financial statements, for example through the imposition of fines or litigations. 
Our procedures in respect of the above included:
 
Review of minutes of meeting of those charged with governance for any instances of non-compliance with laws and regulations;
Review of financial statement disclosures and agreeing to supporting documentation; and
Review of legal expenditure accounts to understand the nature of expenditure incurred.

Fraud
We assessed the susceptibility of the financial statements to material misstatement, including fraud. Our risk assessment procedures included:
 
Enquiry with management and those charged with governance regarding any known or suspected instances of fraud;
Obtaining an understanding of the Group’s policies and procedures relating to:
-  Detecting and responding to the risks of fraud; and 
-  Internal controls established to mitigate risks related to fraud. 
Review of minutes of meeting of those charged with governance for any known or suspected instances of fraud;
Discussion amongst the engagement team as to how and where fraud might occur in the financial statements;
Performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud; and
Considering remuneration incentive schemes and performance targets and the related financial statement areas impacted by these.
Page 5

 
SK JV BIDCO LIMITED
 

 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SK JV BIDCO LIMITED (CONTINUED)



Our procedures in respect of the above included:
 
Testing a sample of journal entries throughout the year, which met a defined risk criteria, by agreeing to supporting documentation; and
Assessing significant estimates made by management, including the valuation of freehold property for bias.

We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members who were all deemed to have appropriate competence and capabilities and remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit.  

Our audit procedures were designed to respond to risks of material misstatement in the financial statements, recognising that the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery, misrepresentations or through collusion. There are inherent limitations in the audit procedures performed and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we are to become aware of it.


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.


Use of our report
 

This report is made solely to the Parent 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.





Christopher Young (Senior Statutory Auditor)
  
for and on behalf of
BDO LLP, Statutory Auditor
 
London, UK



22 September 2023
BDO LLP is a limited liability partnership registered in England and Wales (with registered number OC305127).
Page 6

 
SK JV BIDCO LIMITED
 

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE PERIOD ENDED 31 DECEMBER 2022

Period ended
31 December
2022
Note
£000

  

Turnover
 4 
3,670

Cost of sales
  
(57)

Gross profit
  
3,613

Administrative expenses
  
(1,471)

Fair value movement on investment property
 11 
1,725

Operating profit
  
3,867

Interest receivable and similar income
  
5

Interest payable and similar expenses
 7 
(846)

Profit before taxation
  
3,026

Tax on profit
 8 
(572)

Profit for the financial period
  
2,454

Profit for the period attributable to:
  

Owners of the parent Company
  
2,454

  
2,454

There was no other comprehensive income for 2022.

The notes on pages 13 to 25 form part of these financial statements.

Page 7

 
SK JV BIDCO LIMITED
REGISTERED NUMBER: 13950011

CONSOLIDATED BALANCE SHEET
AS AT 31 DECEMBER 2022

2022
Note
£000

Fixed assets
  

Tangible assets
 9 
204

Investment property
 11 
62,100

  
62,304

Current assets
  

Stocks
 12 
23

Debtors: amounts falling due within one year
 13 
869

Cash at bank and in hand
 14 
2,266

  
3,158

Creditors: amounts falling due within one year
 15 
(16,775)

Net current liabilities
  
 
 
(13,617)

Total assets less current liabilities
  
48,687

Creditors: amounts falling due after more than one year
 16 
(30,800)

Provisions for liabilities
  

Deferred taxation
 18 
(432)

  
 
 
(432)

Net assets
  
17,455


Capital and reserves
  

Called up share capital 
 19 
2

Share premium account
 20 
14,999

Profit and loss account
 20 
2,454

Equity attributable to owners of the parent Company
  
17,455

  
17,455


The financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime and in accordance with the provisions of FRS 102 Section 1A - small entities.

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




Mr R Greenwood
Director

Date: 22 September 2023

The notes on pages 13 to 25 form part of these financial statements.
Page 8

 
SK JV BIDCO LIMITED
REGISTERED NUMBER: 13950011

CONSOLIDATED BALANCE SHEET (CONTINUED)
AS AT 31 DECEMBER 2022


Page 9

 
SK JV BIDCO LIMITED
REGISTERED NUMBER: 13950011

COMPANY BALANCE SHEET
AS AT 31 DECEMBER 2022

2022
Note
£000

Fixed assets
  

Investments
 10 
40,257

Current assets
  

Debtors: amounts falling due within one year
 13 
20,245

Cash at bank and in hand
 14 
74

  
20,319

Creditors: amounts falling due within one year
 15 
(15,346)

Net current assets
  
 
 
4,973

Total assets less current liabilities
  
45,230

  

Creditors: amounts falling due after more than one year
 16 
(30,800)

  

Net assets
  
14,430


Capital and reserves
  

Called up share capital 
 19 
2

Share premium account
 20 
14,999

Loss for the period
  
(571)

Profit and loss account carried forward
  
(571)

  
14,430


The Company's financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime.

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


Mr R Greenwood
Director

Date: 22 September 2023

The notes on pages 13 to 25 form part of these financial statements.

Page 10

 
SK JV BIDCO LIMITED
 

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 31 DECEMBER 2022


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

£000
£000
£000
£000

At 2 March 2022
-
-
-
-


Comprehensive income for the period

Profit for the period
-
-
2,454
2,454


Contributions by and distributions to owners

Shares issued during the period
2
14,999
-
15,001


At 31 December 2022
2
14,999
2,454
17,455

The notes on pages 13 to 25 form part of these financial statements.

Page 11

 
SK JV BIDCO LIMITED
 

COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 31 DECEMBER 2022


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

£000
£000
£000
£000

At 2 March 2022
-
-
-
-


Comprehensive loss for the period

Loss for the period
-
-
(571)
(571)


Contributions by and distributions to owners

Shares issued during the period
2
14,999
-
15,001


At 31 December 2022
2
14,999
(571)
14,430

The notes on pages 13 to 25 form part of these financial statements.

Page 12

 
SK JV BIDCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2022

1.


General information

SK JV Bidco Limited is a private company, limited by shares and incorporated in England and Wales, registration number 13950011. The registered office address is 127a High Street, Ruislip, Middlesex, HA4 8JN.

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 Section 1A of Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.

The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires Group management to exercise judgement in applying the Group's accounting policies (see note 3).

The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of Comprehensive Income in these financial statements.

The Company has taken advantage of the exemption allowed under section 1A.7 of FRS 102 and has not presented its own Statement of Cash Flows in these financial statements.
These financial statements are presented in sterling, which is the functional currency of the Company and Group and rounded to the nearest £'000 unless otherwise stated.
The Company was incorporated on 2 March 2022 and began trading on that date.

The following principal accounting policies have been applied:

  
2.2

Compliance with accounting standards

The financial statements have been prepared using FRS 102, the financial reporting standard applicable in the UK and Republic of Ireland, including the disclosure and presentation requirements of Section 1A, applicable to small companies. There were no material departures from that standard.

Page 13

 
SK JV BIDCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2022

2.Accounting policies (continued)

 
2.3

Basis of consolidation

The consolidated financial statements present the results of the Company and its own subsidiaries ("the Group") as if they form a single entity. Intercompany transactions and balances between group companies are therefore eliminated in full.
The Group acquires subsidiaries that own investment properties. At the time of acquisition, the Group considers whether each acquisition represents the acquisition of a business or the acquisition of an asset. The Directors consider whether a set of activities and assets which include an input and a substantive process that together significantly contribute to the ability to create outputs has been acquired in determining whether the acquisition represents the acquisition of a business. The Group has not purchased, and does not intend to purchase, any subsidiaries which incorporate any assets other than investment property.
Where such acquisitions are not judged to be the acquisition of a business, they are not treated as business combinations. Rather, the cost to acquire the corporate entity is allocated between the identifiable assets and liabilities of the entity based upon their relative fair values at the acquisition date. Accordingly, no goodwill or deferred tax arises.
All corporate acquisitions during the period have been treated as asset purchases rather than business combinations because the fair value of the subsidiaries assets acquired is concentrated into a single asset, investment property, and therefore is not a business combination.

 
2.4

Going concern

In reviewing the current financial position of the Group, the Directors have noted that at the reporting date the Group had net current liabilities of £13,617,000, net assets of £17,455,000, profit before tax for the year of £3,026,000 and cash generated from operations during the year of £2,266,000.
The Directors of the Group have prepared cash flow forecasts for a period of 12 months from the date of approval of these financial statements. Those cash flow forecasts show that the Group is able to continue to operate within the existing facilities available. The Directors have also given due consideration to the future plans for the Company, the profile of debt maturities and the covenants associated with the bank facility. In addition, the Directors of the Group have obtained a letter of support from the joint venture partners, MREF V Storage Holdings Limited and Stor-Age International (Pty) Ltd, which confirms that financial support will be provided, if required, to allow the the Group to meet its liabilities as they fall due for a period of at least 12 months from the approval of these financial statements.
As a result of this assessment, the Directors are confident about the ability of the Group to continue as a going concern. Thus, the Directors continue to adopt the going concern basis of accounting in preparing the annual financial statements.

  
2.5

Revenue

Revenue is recognised by the Company in respect of goods and services supplied during the year, exclusive of Value Added Tax.
Revenue is attributable to renting storage units to customers and selling merchandise.
Storage rental and related income is recognised over the period in which the storage change unit is occupied by the customers on a straight line basis.
Other income is recognised when performance obligations of the relevant service or goods are met.

Page 14

 
SK JV BIDCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2022

2.Accounting policies (continued)

 
2.6

Interest income

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

 
2.7

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.

 
2.8

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 balance sheet date in the countries where the Company and the Group operate and generate income.

Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the balance sheet 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 balance sheet date.

 
2.9

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 Group 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.

Page 15

 
SK JV BIDCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2022

2.Accounting policies (continued)


2.9
Tangible fixed assets (continued)

Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.

Depreciation is provided on the following basis:

Plant and machinery
-
20%
- 33.3%
Fixtures and fittings
-
25%

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.

 
2.10

Investment property

Investment property is carried at fair value determined annually and derived from the current market rents and investment property yields for comparable real estate, adjusted if necessary for any difference in the nature, location or condition of the specific asset. No depreciation is provided. Changes in fair value are recognised in profit or loss.

 
2.11

Valuation of investments

Investments in subsidiaries are measured at cost less accumulated impairment.

 
2.12

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 first in, first out basis. Work in progress and finished goods include labour and attributable overheads.

At each balance sheet 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.

 
2.13

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.

 
2.14

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.

 
2.15

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 16

 
SK JV BIDCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2022

2.Accounting policies (continued)

 
2.16

Provisions for liabilities

Provisions are made where an event has taken place that gives the Group 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 Group becomes aware of the obligation, and are measured at the best estimate at the balance sheet 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 Balance Sheet.

 
2.17

Financial instruments

The Group 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 Consolidated 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.

Page 17

 
SK JV BIDCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2022

3.


Judgements in applying accounting policies and key sources of estimation uncertainty

In preparing the financial statements, management is required to make judgements, estimates and assumptions which affect reported income, expenses, assets, liabilities and disclosure of contingent assets and liabilities. Use of available information and application of judgement are inherent in the formation of estimates, together with past experience and expectations of future events that are believed to be reasonable under the circumstances. Actual results in the future could differ from such estimates.
Valuation of Investment Property
In arriving at the valuation of the Group's investment properties, the Directors used estimates of the property's future operating income streams. Investment yields are applied based on historical experience and advice from independent advisors. The future income streams are estimated based on current contractual arrangements. Management takes into account a number including the impact of real estate market and demand and varying occupancy rates to arrive at the period end value.
Classiciation of the acquisitions in the period as an asset acquisition
The acquisition of the subsidiaries has been recxognised as an asset acquisition rather than a business combination. The accounting treatment applied is set out in note 2.3. 


4.


Turnover

The whole of the turnover is attributable to the Group's principal activity.

All turnover arose within the United Kingdom.


5.


Operating profit

Period ended
31 December
2022
£000

Auditors' remuneration - audit of Company and Group financial statements
6

Auditors' remuneration - audit of subsidiary financial statements
61

Auditors' remuneration - tax services
17


6.


Employees

The average monthly number of employees, including Directors, during the period was 5.


7.


Interest payable and similar expenses

Period ended
31 December
2022
£000


Bank interest payable
846

Page 18

 
SK JV BIDCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2022

8.


Taxation


Period ended
31 December
2022
£000

Corporation tax


Current tax on profits for the year
140

Total corporation tax

140


Deferred tax


Origination and reversal of timing differences
432

Total deferred tax
432


Tax on profit
572

Factors affecting tax charge for the period

The tax assessed for the period is higher than the standard rate of corporation tax in the UK of 19%. The differences are explained below:

Period ended
31 December
2022
£000


Profit on ordinary activities before tax
3,026


Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 19%
575

Effects of:


Capital allowances for period in excess of depreciation
(435)

Deferred tax
432

Total tax charge for the period
572


Factors that may affect future tax charges

On 3 March 2021, the UK Chancellor of the Exchequer announced that the corporation tax rate would increase to a maximum of 25% from 1 April 2023. This was substantively enacted on 24 May 2021. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled, or the asset is realised, based on tax law and the corporation tax rates that have been enacted, or substantively enacted, at 31 December 2022. As such, the deferred tax rate applicable at 31 December 2022 is 25% and deferred tax has been re-measured at this rate.

Page 19

 
SK JV BIDCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2022

9.


Tangible fixed assets

Group






Plant and machinery
Fixtures and fittings
Total

£000
£000
£000



Cost or valuation


At 2 March 2022
-
-
-


Acquistion of subsidiary undertakings
192
12
204



At 31 December 2022

192
12
204






Net book value



At 31 December 2022
192
12
204


10.


Fixed asset investments

Company





Investments in subsidiary companies

£000



Cost or valuation


At 2 March 2022
-


Additions
40,257



At 31 December 2022
40,257




During the period the Company acquired 100% of the share capital of SK JV 5 Holdco Limited and its indirect subsidiary undertakings.


Direct subsidiary undertaking


The following was a direct subsidiary undertaking of the Company:

Name

Registered office

Class of shares

Holding

SK JV 5 Holdco Limited
127a High Street, Ruislip, Middlesex, HA4 8JN
Ordinary
100%

Page 20

 
SK JV BIDCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2022

Indirect subsidiary undertakings


The following were indirect subsidiary undertakings of the Company:

Name

Registered office

Class of shares

Holding

SK JV 5 Midco Limited
127a High Street, Ruislip, Middlesex, HA4 8JN
Ordinary
100%
SK Banbury Limited
127a High Street, Ruislip, Middlesex, HA4 8JN
Ordinary
100%
SK Wednesbury Limited
127a High Street, Ruislip, Middlesex, HA4 8JN
Ordinary
100%
SK Salisbury Limited
127a High Street, Ruislip, Middlesex, HA4 8JN
Ordinary
100%
SK Frome Limited
127a High Street, Ruislip, Middlesex, HA4 8JN
Ordinary
100%


11.


Investment property

Group


Freehold investment property

£000



Valuation


At 2 March 2022
-


Surplus on revaluation
1,725


On acquisition of subsidiaries
60,375



At 31 December 2022
62,100

In arriving at the valuation of the Group's investment properties, the Directors used estimates of the property's future operating income streams. Investment yields are applied based on historical experience and advice from independent advisors. The future income streams are estimated based on current contractual arrangements. Management takes into account a number including the impact of real estate market and demand and varying occupancy rates to arrive at the period end value.








Page 21

 
SK JV BIDCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2022

12.


Stocks

Group
2022
£000

Consumables
23



13.


Debtors

Group
Company
2022
2022
£000
£000


Trade debtors
125
-

Amounts owed by group undertakings
-
20,035

Other debtors
554
177

Prepayments and accrued income
190
-

Deferred taxation (note 18)
-
33

869
20,245


Amounts owed by group undertakings are interest free and repayable on demand. The balances outstanding are not expected to be settled within 12 months of the year end date.


14.


Cash and cash equivalents

Group
Company
2022
2022
£000
£000

Cash at bank and in hand
2,266
74



15.


Creditors: Amounts falling due within one year

Group
Company
2022
2022
£000
£000

Trade creditors
460
200

Amounts owed to group undertakings
15,000
15,000

Other taxation and social security
152
17

Other creditors
124
117

Accruals and deferred income
1,039
12

16,775
15,346


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

Page 22

 
SK JV BIDCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2022

16.


Creditors: Amounts falling due after more than one year

Group
Company
2022
2022
£000
£000

Bank loans
30,800
30,800


Bank loans attract interest at a fixed rate of 3.53% per annum and are repayable by March 2027.
Bank loans are secured via fixed and floating charge over all assets of the Group. 


17.


Financial instruments

Group
Company
2022
2022
£000
£000

Financial assets

Financial assets measured at amortised cost
2,939
251


Financial liabilities

Financial liabilities measured at amortised cost
(46,898)
(46,130)


Financial assets measured at amortised cost comprise cash, trade and other debtors.


Financial liabilities measured at amortised cost comprise trade and other payables, accruals and deferred income, amounts owed to group undertakings and bank loans.

Page 23

 
SK JV BIDCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2022

18.


Deferred taxation


Group



2022


£000






At beginning of period
-


Charged to profit or loss
(432)



At end of period
(432)

Company


2022


£000






At beginning of year
-


Charged to profit or loss
33



At end of year
33

The deferred taxation balance is made up as follows:

Group
Company
2022
2022
£000
£000

Latent gains on the fair value of investment property
(432)
33

(432)
33


19.


Share capital

2022
£000
Allotted, called up and fully paid


2,000 Ordinary shares of £1.00 each
2


During the period the Company issued 2,000 ordinary shares which were subscribed to at par.

Page 24

 
SK JV BIDCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2022

20.


Reserves

Share premium account

The share premium account is the credited difference in price between the par value of the shares and the total price the Company received for the issued shares.

Profit and loss account

The profit and loss account represents cumulative profits and losses net of all adjustments.


21.


Related party transactions

The Company is exempt under the terms of Financial Reporting Standard 102 (FRS 102) paragraph 33.1A, from disclosing related party transactions with other group companies.
During the period the Company received loans from its parent undertakings of £15,000,000 which remain outstanding at the period end and are presented in creditors falling due within one year. Refer to note 15 for details.


22.


Controlling party

The Company's immediate parent companies are MREF V Storage Holdings Limited, a company incorporated in England and Wales, and Stor-Age International (Pty) Ltd, a company incorporated in South Africa.
The ultimate parent and controlling party is MREF V "B" Limited Partnership, a limited partnership registered in England and Wales.


Page 25