Company registration number SC405192 (Scotland)
ST. JOHNS HILL WIND HOLDCO LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 30 JUNE 2022
ST. JOHNS HILL WIND HOLDCO LIMITED
COMPANY INFORMATION
Directors
N A Wood
(Appointed 10 May 2022)
L J B Roberts
(Appointed 10 May 2022)
Secretary
FLB Company Secretarial Services Limited
Company number
SC405192
Registered office
101 Rose Street South Lane
Edinburgh
Scotland
EH2 3JG
Independent auditor
KPMG Channel Islands Limited
Glategny Court
Glategny Esplanade
St Peter Port
Guernsey
GY1 1WR
ST. JOHNS HILL WIND HOLDCO LIMITED
CONTENTS
Page
Directors' report
1 - 3
Independent auditor's report
4 - 7
Statement of comprehensive income
8
Statement of financial position
9
Statement of changes in equity
10
Statement of cash flows
11
Notes to the financial statements
12 - 25
ST. JOHNS HILL WIND HOLDCO LIMITED
DIRECTORS' REPORT
FOR THE PERIOD ENDED 30 JUNE 2022
- 1 -

The directors present their annual report and audited financial statements of St. Johns Hill Wind Holdco Limited (the "Company") for the period 1 January 2022 to 30 June 2022. The period of 6 months is a shorter period than the comparative year to 31 December 2021, due to a change in the Company's year end to align with other entities within the Bluefield Solar Income Fund Limited group ("the Group").

Principal activities

The principal activity of the Company is holding investments that operate renewable energy installations ("Renewable Projects") to generate renewable electricity.

 

Country of incorporation and legal form of the entity

St. Johns Hill Wind Holdco Limited was incorporated as a private company, limited by shares, under the Registrar of Companies for Scotland on 11 August 2011.

 

Risk management and Control

In the ordinary course of business, the Company is exposed to and manages a variety of risks in relation to its activities, including financial risk. The management of credit, interest rate, liquidity and operational risks are fundamental to the Company, with the Board of directors having responsibility for the overall system of internal control and for reviewing its effectiveness.

 

The primary areas of risk considered by the directors are:

 

Interest risk: Fluctuations in the prevailing levels of market rates of interest pose a risk to the Company's financial position and cash flow. This is not considered a significant risk to the Company as the interest on loans owed to group undertakings is charged at a rate agreed by the parent company and are not subject to interest movements in the market. The Company also holds external loans which bear interest at a prescribed margin over the UK Base Rate, which is subject to increases and decreases. The Company uses interest rate swap contracts to mitigate its exposure to the interest rate risk attached to changes in the Base Rate on its external loans which is subject to fluctuation.

 

Liquidity risk: Failure to meet financial obligations in a timely and cost effective manner due to mismatches in the maturity profile of assets and liabilities. The Company closely monitors its cash flow levels and financial obligations to anticipate its future cash commitments.

 

Portfolio operation risk: The Directors consider that the principal risks impacting the Company relate to portfolio operation, management and reporting. The risks associated with the underperformance of the portfolio are mitigated through the asset management activities of Bluefield Services Limited who send weekly, monthly and annual reports highlighting the operational status of the portfolio as well as engaging with contractors to ensure technical issues are resolved promptly. Reporting risks, which principally cover possible valuation discrepancies (detail of which are highlighted in note 9), are mitigated through work performed by the Company's Investment Advisor who are an active participant within the UK wind market.

 

COVID-19 risk: During the period there has been limited impact on the business and its activities. The directors have continued to review the forecasts to ensure a true and fair reflection of the impact, if any, of COVID-19.

 

Russia/Ukraine conflict risk: The directors are continuously monitoring the impact, if any, that the ongoing conflict in Ukraine may have on the entity and the impact on energy prices across the portfolio. The Company has no direct exposure to either Ukraine or Russia.

Results and dividends

The profit for the period, after taxation, amounted to £7,077,456 (2021: £2,758,193 as restated).

 

No dividends were distributed in the current or prior period.

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

ST. JOHNS HILL WIND HOLDCO LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
- 2 -
Directors

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

N A Forster
(Resigned 10 May 2022)
D M Reid
(Resigned 10 May 2022)
N A Wood
(Appointed 10 May 2022)
L J B Roberts
(Appointed 10 May 2022)
Qualifying third party indemnity provisions

The company has made qualifying third party indemnity provisions for the benefit of its directors during the period. These provisions remain in force at the reporting date.

Post reporting date events

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

Independent Auditor

KPMG Channel Islands Limited were appointed as auditor to the company and in accordance with section 485 of the Companies Act 2006, a resolution proposing that they be re-appointed will be put at a General Meeting.

Statement of directors' responsibilities

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

 

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law), including FRS 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:

 

 

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are responsible for such internal control as they determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error, and have general responsibility for taking such steps as are reasonably open to them to safeguard the assets of the Company and to prevent and detect fraud and other irregularities.

Statement of disclosure to auditor

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

ST. JOHNS HILL WIND HOLDCO LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
- 3 -
Small companies

In preparing the financial statements, the directors have taken advantage of section 414B of the Companies Act 2006 and have not prepared a Strategic Report.

On behalf of the board
N A Wood
Director
15 November 2023
ST. JOHNS HILL WIND HOLDCO LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF ST. JOHNS HILL WIND HOLDCO LIMITED
- 4 -
Our opinion

We have audited the financial statements of St. Johns Hill Wind HoldCo Limited (the “Company”), which comprise the statement of financial position as at 30 June 2022, the statements of comprehensive income, changes in equity and cash flows for the period from 1 January 2022 to 30 June 2022, and notes, comprising significant accounting policies and other explanatory information.

In our opinion, the accompanying financial statements:

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (“ISAs (UK)”) and applicable law. Our responsibilities are described below. We have fulfilled our ethical responsibilities under, and are independent of the Company in accordance with, UK ethical requirements including FRC Ethical Standards. We believe that the audit evidence we have obtained is a sufficient and appropriate basis for our opinion.

Going concern

The directors have prepared the financial statements on the going concern basis as they do not intend to liquidate the Company or to cease its operations, and as they have concluded that the Company's financial position means that this is realistic. They have also concluded that there are no material uncertainties that could have cast significant doubt over its ability to continue as a going concern for at least a year from the date of approval of the financial statements (the “going concern period").

 

In our evaluation of the directors' conclusions, we considered the inherent risks to the Company's business model and analysed how those risks might affect the Company's financial resources or ability to continue operations over the going concern period.

 

Our conclusions based on this work:

 

However, as we cannot predict all future events or conditions and as subsequent events may result in outcomes that are inconsistent with judgements that were reasonable at the time they were made, the above conclusions are not a guarantee that the Company will continue in operation.

ST. JOHNS HILL WIND HOLDCO LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ST. JOHNS HILL WIND HOLDCO LIMITED
- 5 -

Fraud and breaches of laws and regulations – ability to detect

Identifying and responding to risks of material misstatement due to fraud

To identify risks of material misstatement due to fraud (“fraud risks”) we assessed events or conditions that could indicate an incentive or pressure to commit fraud or provide an opportunity to commit fraud. Our risk assessment procedures included:

 

As required by auditing standards, and taking into account possible incentives or pressures to misstate performance and our overall knowledge of the control environment, we perform procedures to address the risk of management override of controls, in particular the risk that management may be in a position to make inappropriate accounting entries, and the risk of bias in accounting estimates such as valuation of unquoted investments. On this audit we do not believe there is a fraud risk related to revenue recognition because the Company’s revenue streams are simple in nature with respect to accounting policy choice, and are easily verifiable to external data sources or agreements with little or no requirement for estimation from management. We did not identify any additional fraud risks.

 

We performed procedures including:

 

Identifying and responding to risks of material misstatement due to non-compliance with laws and regulations

We identified areas of laws and regulations that could reasonably be expected to have a material effect on the financial statements from our general sector experience and through discussion with management (as required by auditing standards), and discussed with management the policies and procedures regarding compliance with laws and regulations.

 

The Company is subject to laws and regulations that directly affect the financial statements including financial reporting legislation and taxation legislation and we assessed the extent of compliance with these laws and regulations as part of our procedures on the related financial statement items.

 

The Company is subject to other laws and regulations where the consequences of non-compliance could have a material effect on amounts or disclosures in the financial statements, for instance through the imposition of litigation or impacts on the Company’s ability to operate. We identified company law as being the area most likely to have such an effect. Auditing standards limit the required audit procedures to identify non-compliance with these laws and regulations to enquiry of management and inspection of regulatory and legal correspondence, if any. Therefore if a breach of operational regulations is not disclosed to us or evident from relevant correspondence, an audit will not detect that breach.

 

Context of the ability of the audit to detect fraud or breaches of law or regulation

Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it.

 

In addition, as with any audit, there remains a higher risk of non-detection of fraud, as this may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls. Our audit procedures are designed to detect material misstatement. We are not responsible for preventing non-compliance or fraud and cannot be expected to detect non-compliance with all laws and regulations.

 

ST. JOHNS HILL WIND HOLDCO LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ST. JOHNS HILL WIND HOLDCO LIMITED
- 6 -

The directors' report

The directors are responsible for the directors' report. Our opinion on the financial statements does not cover that report and we do not express an audit opinion thereon.

 

Our responsibility is to read the directors' report and, in doing so, consider whether, based on our financial statements audit work, the information therein is materially misstated or inconsistent with the financial statements or our audit knowledge. Based solely on that work:

Matters on which we are required to report by exception

Under the Companies Act 2006, we are required to report to you if, in our opinion:

 

We have nothing to report in these respects.

Respective responsibilities

Directors' responsibilities

As explained more fully in their statement set out on page 2, the directors are responsible for: the preparation of the financial statements including being satisfied that they give a true and fair view; such internal control as they determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error; 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 they either intend to liquidate the Company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities

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 our opinion in an auditor’s report. Reasonable assurance is a high level of assurance, but does not 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 aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the financial statements.

A fuller description of our responsibilities is provided on the FRC’s website at www.frc.org.uk/auditorsresponsibilities.

ST. JOHNS HILL WIND HOLDCO LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ST. JOHNS HILL WIND HOLDCO LIMITED
- 7 -

The purpose of our audit work and to whom we owe our responsibilities

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

Barry Ryan (Senior Statutory Auditor)
For and on behalf of KPMG Channel Islands Limited (Statutory Auditor)
Chartered Accountants
Guernsey
16 November 2023
ST. JOHNS HILL WIND HOLDCO LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE PERIOD ENDED 30 JUNE 2022
- 8 -
Period
Year
ended
ended
30 June
31 December
2022
2021
as restated
Notes
£
£
Turnover
3
62,894
129,000
Administrative expenses
(91,697)
(130,339)
Net gains on financial assets held at fair value through profit or loss
7
7,666,568
3,898,269
Operating profit
7,637,765
3,896,930
Interest payable and similar expenses
6
(560,309)
(1,138,737)
Profit before taxation
7,077,456
2,758,193
Tax on profit
8
-
0
-
0
Profit for the financial period
7,077,456
2,758,193
Other comprehensive income
Cash flow hedges gain arising in the period
820,267
-
0
Total comprehensive income for the period
7,897,723
2,758,193

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

 

The notes on pages 12 to 25 form part of these financial statements.

ST. JOHNS HILL WIND HOLDCO LIMITED
STATEMENT OF FINANCIAL POSITION
AS AT
30 JUNE 2022
30 June 2022
- 9 -
2022
2021
as restated
Notes
£
£
£
£
Fixed assets
Financial assets held at fair value through profit or loss
9
44,642,845
37,214,533
Current assets
Debtors
11
850,911
167,100
Cash at bank and in hand
215,472
297,354
1,066,383
464,454
Creditors: amounts falling due within one year
12
(16,538,679)
(15,731,136)
Net current liabilities
(15,472,296)
(15,266,682)
Total assets less current liabilities
29,170,549
21,947,851
Creditors: amounts falling due after more than one year
13
(7,138,972)
(7,813,997)
Net assets
22,031,577
14,133,854
Capital and reserves
Called up share capital
16
1,450,100
1,450,100
Hedging reserve
17
820,267
-
0
Profit and loss reserves
19,761,210
12,683,754
Total equity
22,031,577
14,133,854

The notes on pages 12 to 25 form part of these financial statements.

The financial statements were approved by the board of directors and authorised for issue on 15 November 2023 and are signed on its behalf by:
N A Wood
Director
Company Registration No. SC405192
ST. JOHNS HILL WIND HOLDCO LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 30 JUNE 2022
- 10 -
Share capital
Hedging reserve
Profit and loss reserves
Total
£
£
£
£
As restated for the period ended 31 December 2021:
Balance at 1 January 2021
1,450,100
-
(1,116,195)
333,905
Effect of change in accounting policy
-
-
0
11,041,756
11,041,756
As restated
1,450,100
-
0
9,925,561
11,375,661
Year ended 31 December 2021:
Profit and total comprehensive income for the year
-
-
2,758,193
2,758,193
Balance at 31 December 2021 (as restated):
1,450,100
-
0
12,683,754
14,133,854
Period ended 30 June 2022:
Profit for the period
-
-
7,077,456
7,077,456
Other comprehensive income:
Cash flow hedges gains
-
820,267
-
820,267
Total comprehensive income for the period
-
820,267
7,077,456
7,897,723
Balance at 30 June 2022
1,450,100
820,267
19,761,210
22,031,577

The notes on pages 12 to 25 form part of these financial statements.

ST. JOHNS HILL WIND HOLDCO LIMITED
STATEMENT OF CASH FLOWS
FOR THE PERIOD ENDED 30 JUNE 2022
- 11 -
2022
2021
Notes
£
£
£
£
Cash flows from operating activities
Cash (absorbed by)/generated from operations
21
(17,971)
36,957
Investing activities
Receipts from investments
7
238,256
1,056,468
Net cash generated from investing activities
238,256
1,056,468
Financing activities
Repayment of borrowings
(485,917)
(681,454)
Interest paid
(130,082)
(277,269)
Net cash used in financing activities
(615,999)
(958,723)
Net (decrease)/increase in cash and cash equivalents
(395,714)
134,702
Cash and cash equivalents at beginning of period
(4,838)
(139,540)
Cash and cash equivalents at end of period
(400,552)
(4,838)
Relating to:
Cash at bank and in hand
215,472
297,354
Bank overdrafts included in creditors payable within one year
(616,024)
(302,192)

The notes on pages 12 to 25 form part of these financial statements.

ST. JOHNS HILL WIND HOLDCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 30 JUNE 2022
- 12 -
1
Accounting policies
Company information

St. Johns Hill Wind Holdco Limited is a private Company limited by shares incorporated in Scotland. The registered office is 101 Rose Street South Lane, Edinburgh, Scotland, EH2 3JG.

 

The principal activity of the Company is holding investments that operate renewable energy installations ("Renewable Projects") to generate renewable electricity.

1.1
Reporting period

The directors present a shorter period of account from 1 January 2022 to 30 June 2022, due to aligning the year end with other entities in the Bluefield Solar Income Fund Limited group ("the Group"). As such, the comparatives for a whole year are not entirely comparable.

1.2
Accounting convention

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

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

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

 

 

The directors have concluded that the Company’s subsidiaries should be excluded from consolidation as the interests in subsidiaries are held as part of an investment portfolio, as defined in paragraph 9.9 (b) of FRS 102 and are measured at fair value with movements in fair value recognised in the Statement of Comprehensive Income in the year in which they arise.

1.3
Going concern

These accounts have been prepared on a going concern basis although the Company is in a net current liability position. The directors believe this basis is appropriate following the consideration of cashflow forecasts which show the Company is able to meet its liabilities as they fall due for at least 12 months from the date of approval of these financial statements.

 

At the period end, the Company reported net current liabilities of £15,472,296 (2021: £15,266,682 as restated).

 

The directors have considered the impact which the current conflict in Ukraine could have on the Company. In their view, as the Company has no direct exposure to Ukraine or Russia, the directors do not expect a significant impact on revenue and cash flows of the Company arising from the conflict.

 

Should any unforeseen circumstances require additional funding, the Company has obtained written confirmation from its intermediate parent that it would provide financial support to meet the Company's liabilities for a period of at least 12 months from the date the financial statements are approved.

1.4
Turnover

Consultancy services fee income is recognised on an accrual basis.

 

The Company has entered into consultancy agreements with its SPV for the provision of on-going ad-hoc advisory services in the management, administration and operation of its SPV. The consultancy services fee income is charged according to plant capacity and agreed from time to time between St. Johns Hill Wind Holdco Limited and its SPV.

ST. JOHNS HILL WIND HOLDCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
1
Accounting policies
(Continued)
- 13 -
1.5
Fixed asset investments (change in accounting policy)

Following the change of ownership and the incorporation of the Company into the group headed by Bluefield Solar Income Fund Limited, the ultimate parent company, the directors have considered the position of the Company and are of the opinion that the Company's investment in its subsidiaries ("SPVs") are held as part of an investment portfolio. As such, the Company should exclude all its SPVs from consolidation on the grounds set out in FRS 102 paragraph 9.9(b) and the SPVs should be measured at fair value recognised in statement of comprehensive income.

 

This change in accounting policy is required to be accounted for retrospectively and the relevant comparative figures have been restated. Please refer to note 23 to the financial statements for more detail on the restatement.

 

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

1.6
Cash and cash equivalents

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

1.7
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, unless otherwise detailed below.

 

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

 

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

Basic financial assets

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

Other financial assets

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

ST. JOHNS HILL WIND HOLDCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
1
Accounting policies
(Continued)
- 14 -
Financial assets at fair value through profit or loss

Classification

The Company has been classified as an investment entity and as such its investments in any subsidiaries are held at fair value through profit or loss and measured in accordance with the requirements of FRS 102 (see note 2).

 

Recognition

Investments made by the Company in its subsidiaries are initially recognised at transaction price on the day the investment is made. Transaction costs arising from the acquisition of the investments that are recurring in nature and that would not be expected to be recovered on a subsequent sale of the investment (such as legal fees relating to due diligence and technical reviews of the wind or solar farms) are expensed to the Statement of Comprehensive Income. However, transaction costs intrinsically linked to the value of the investments (such as legal fees relating to the contract on the construction and maintenance of wind or solar assets, stamp duty costs relating to the leases on the wind or solar farms, insurance during construction and technical due diligence on construction) are included in the cost of the financial assets held at fair value through profit or loss.

 

Measurement

Subsequent to initial recognition, investments in subsidiaries are measured at each subsequent reporting date at fair value. Gains and losses resulting from the revaluation of investments are recognised in the Statement of Comprehensive Income. The Company has elected to recognise all gains and losses from financial assets held at fair value through profit or loss as a single line in the Statement of Comprehensive Income. Fair value is determined on an unleveraged, discounted cash- flow basis in accordance with The International Private Equity and Venture Capital ("IPEV') Valuation Guidelines recognising any other assets and liabilities of the subsidiary.

Impairment of financial assets

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

 

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

 

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

Derecognition of financial assets

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

Classification of financial liabilities

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

ST. JOHNS HILL WIND HOLDCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
1
Accounting policies
(Continued)
- 15 -
Basic financial liabilities

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

Other financial liabilities

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

 

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

Derecognition of financial liabilities

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

1.8
Equity instruments

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

1.9
Taxation

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

Current tax

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

Deferred tax

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

 

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

ST. JOHNS HILL WIND HOLDCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
1
Accounting policies
(Continued)
- 16 -
1.10

Loans

Non-derivative financial liabilities with fixed or determinable repayments that are not quoted in an active market are classified as loans. Loans are initially recognised at fair value of the consideration received plus directly related transaction costs. They are subsequently measured at amortised cost using the effective interest method. Arrangement fees and interest payable on financial liabilities that are classified as loans, are charged to the statement of comprehensive income.

 

The effective interest method is a method of calculating the amortised cost of a financial liability and of allocating the interest payable over the expected life of the liability. The effective interest rate is the rate that exactly discounts estimated future cashflows to the instrument's initial carrying amount. Calculation of the effective interest rate takes into account fees payable, that are an integral part of the instrument yield and transaction costs. All contractual terms of a financial instrument are considered when estimating future cash flows.

 

A financial liability is removed from the statement of financial position when the obligation is discharged, or cancelled, or expires.

1.11

Hedge accounting

The Company uses variable to fixed interest rate swaps to manage its exposure to fair value risk on its long term borrowings. These derivatives are measured at fair value at each reporting date.

 

To the extent the cash flow hedge is effective, movements in fair value are recognised in other comprehensive income and represented in a separate cash flow hedge reserve. Any ineffective portions of those movements are recognised in statement of comprehensive income for the year.

1.12

Interest payable and similar expenses

Interest payable and similar expenses are charged to the statement of comprehensive income over the term of the debt so that the amount charged is at a constant rate on the carrying amount. Interest payable and similar expenses include issue costs, which are initially recognised as a reduction in the proceeds of the associated capital instrument.

ST. JOHNS HILL WIND HOLDCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
- 17 -
2
Judgements and key sources of estimation uncertainty

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

 

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

 

In preparing these financial statements, the directors have made the following judgements and estimates:

 

 

 

 

 

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

3
Turnover

 

All turnover arose within the United Kingdom from consultancy services in the current period.

4
Auditor's remuneration
2022
2021
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the company
3,000
3,250
5
Employees

The Company had no employees (2021 - Nil) other than its directors, who did not receive any remuneration (2021 - Nil).

ST. JOHNS HILL WIND HOLDCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
- 18 -
6
Interest payable and similar expenses
2022
2021
as restated
£
£
Interest on financial liabilities measured at amortised cost:
Interest payable to group undertakings
430,159
863,753
Other interest on financial liabilities
130,150
274,984
560,309
1,138,737
7
Analysis of net gains on financial assets held at fair value through profit or loss
2022
2021
as restated
£
£
Changes in fair value of financial assets held at fair value through profit or loss
7,428,312
1,570,838
Receipts from SPV investments held at fair value through profit or loss
238,256
2,327,431
7,666,568
3,898,269
8
Taxation

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

2022
2021
as restated
£
£
Profit before taxation
7,077,456
2,758,193
Expected tax charge based on the standard rate of corporation tax in the UK of 19.00% (2021: 19.00%)
1,344,717
524,058
Gains not taxable
(1,404,516)
(618,487)
Group relief
59,799
94,429
Taxation charge for the period
-
-

An increase in the rate of corporation tax from 19% to 25% has been substantively enacted at the time of the approval of these financial statements. The increase will be effective from 1 April 2023 and will impact the Company's future tax charges on its taxable profits accordingly.

ST. JOHNS HILL WIND HOLDCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
- 19 -
9
Financial assets held at fair value through profit or loss
2022
2021
as restated
Note
£
£
At 1 January
37,214,533
35,643,695
Change in fair value of financial assets held at fair value through profit or loss
7
7,428,312
1,570,838
At 30 June and 31 December
44,642,845
37,214,533

Valuation methodology and process

The directors base the fair value of the investments in the SPVs held by the Company on information received from the Investment Adviser. Fair value is calculated on discounted cash-flow basis in accordance with the IPE Valuation Guidelines adjusted for other relevant asset and liabilities of the SPVs. The Investment Adviser produces fair value calculations on a semi-annual basis as at 30 June and 31 December each year.

 

Financial assets held at fair value through profit or loss

Wind plants under construction and not yet operational are valued at cost and exclude acquisition costs which are expensed in the period in which they are incurred, whilst investments that are operational are valued on a DCF basis over the life of the asset (typically more than 25 years) and, under willing buyer-willing seller' methodology, prudently benchmarked on a £/MWp basis against comparable transactions for large scale portfolios.

 

Each investment is subject to full UK corporate taxation at the prevailing rate with the tax shield being limited to the applicable capital allowances from the Company's SPV investments.

 

The key inputs to a DCF based approach are: the equity discount rate, the cost of debt (influenced by interest rate, gearing level and length of debt), power price forecasts, long term inflation rates, irradiation forecasts, operational costs and taxation.

 

Given discount rates are a product of not only the factors listed previously but also regulatory support, perceived sector risk and competitive tensions, it is not unusual for discount rates to change over time. Evidence of this is shown by way of the revisions to the original discount rates applied between the first UK wind investments and those witnessed in the past twelve months.

 

Given discount rates are subjective, there is sensitivity within these to the interpretation of factors outlined above.

 

Judgement is used by the Board in determining the weighted average discount rate of 6.75% as at 30 June 2022 with two key factors that have impacted the adoption of this rate outlined below:

 

 

In order to smooth the sensitivity of the valuation to forecast timing or opinion taken by a single forecast, the Board continues to adopt the application of a blended power curve from leading forecasters.

 

 

 

 

 

ST. JOHNS HILL WIND HOLDCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
- 20 -
10
Subsidiaries

Details of the Company's subsidiaries at 30 June 2022 are as follows:

Name of undertaking
Registered office
Nature of business
Class of
% Held
shares held
Direct
Indirect
St. Johns Hill Wind Limited
1o1 Rose Street South Lane, Edinburgh, Scotland, EH2 3JG
Wind power generation
Ordinary
100.00
-
Port of Sheerness Wind Farm Limited
1010 Eskdale Road, Winnersh Triangle, Wokingham, RG41 5TS
Wind power generation
Ordinary
-
100.00
Peel Wind Farms (Sheerness) Limited
1010 Eskdale Road, Winnersh Triangle, Wokingham, RG41 5TS
Holding company
Ordinary
100.00
-
11
Debtors
2022
2021
as restated
Amounts falling due within one year:
£
£
Trade debtors
-
0
38,100
Other debtors
820,267
-
0
Prepayments and accrued income
30,644
129,000
850,911
167,100

Included within other debtors are derivative assets of £820,267 that the Company has entered into for hedging its external loans as disclosed in note 17.

12
Creditors: amounts falling due within one year
2022
2021
as restated
Notes
£
£
Bank loans and overdrafts
14
616,024
302,192
Other borrowings
14
686,970
485,917
Trade creditors
12,302
404,254
Amounts owed to group undertakings
15,131,122
14,362,876
Taxation and social security
2,050
12,864
Accruals and deferred income
90,211
163,033
16,538,679
15,731,136

Included in amount owed to group undertakings are secured debts of £15,131,121 (2021: £13,579,884). The loans are repayable on demand and bears interest at 7% per annum, which compounds annually on 30 June.

13
Creditors: amounts falling due after more than one year
2022
2021
as restated
Notes
£
£
Other borrowings
14
7,138,972
7,813,997
ST. JOHNS HILL WIND HOLDCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
- 21 -
14
Loans and overdrafts
2022
2021
as restated
£
£
Bank overdrafts
616,024
302,192
Other loans
7,825,942
8,299,914
8,441,966
8,602,106
Payable within one year
1,302,994
788,109
Payable after one year
7,138,972
7,813,997

Other loans are secured debts with Clydesdale Bank PLC. The loans are repayable in instalments over 14 years and are secured by way of fixed and floating charges covering all the property or undertaking of the Company and subsidiary. The loans are stated net of amortised loan transaction costs of £261,303 (2021: £273,181). The loan bears interest at 7.0% per annum, which compounds annually on 30 June and repayments are due every 30 June and 31 December, maturing in June 2033.

 

15
Financial instruments
2022
2021
£
£
Carrying amount of financial assets
Financial assets measured at amortised cost
-
(159,261)
Financial assets measured at fair value through profit or loss
44,642,845
37,214,533
Derivative instruments measured at fair value through other comprehensive income
820,267
197,361
Carrying amount of financial liabilities
Financial liabilities measured at amortised cost
23,675,601
23,532,269

Financial assets measured at amortised cost comprise trade debtors.

 

Financial assets measured at fair value through profit or loss comprise investments in group undertakings.

 

Derivatives measured at fair value through other comprehensive income comprise the closing position of the interest rate swap hedge.

 

Financial liabilities measured at amortised cost comprise trade creditors, amounts owed to group undertakings and accruals.

16
Share capital
2022
2021
2022
2021
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary of £1 each
1,450,100
1,450,100
1,450,100
1,450,100
ST. JOHNS HILL WIND HOLDCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
16
Share capital
(Continued)
- 22 -

The Company has one class of Ordinary shares, which have attached to them full voting, dividend and capital distribution rights (including on a winding up). The shares do not confer any rights of redemption.

17
Hedging reserve
2022
2021
£
£
At the beginning of the period
-
-
Gains and losses on cash flow hedges
820,267
-
0
At the end of the period
820,267
-

The hedging reserve represents the movement in fair value of the interest rate swap.

18
Events after the reporting date

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

19
Related party transactions

The Company has taken advantage of the exemption available in Section 33.1A of FRS102 whereby it has not disclosed transactions with the ultimate parent company or any wholly owned subsidiary undertakings of the parent company's group.

20
Ultimate controlling party

The Company's immediate parent company is New Road Solar Limited, a company incorporated in the United Kingdom. The registered office is 2nd Floor 2 City Place, Beehive Ring Road, Gatwick, West Sussex, England, England, RH6 0PA.

 

The ultimate parent company and controlling party is Bluefield Solar Income Fund Limited, which is incorporated in Guernsey.

ST. JOHNS HILL WIND HOLDCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
- 23 -
21
Cash (absorbed by)/generated from operations
2022
2021
£
£
Profit for the period after tax
7,077,456
2,758,193
Adjustments for:
Finance costs
560,309
1,138,737
Amortisation of loan arrangement fees
11,877
23,755
Other gains and losses
(7,666,568)
(3,898,269)
Movements in working capital:
Decrease in debtors
136,455
100,300
Decrease in creditors
(137,500)
(85,759)
Cash (absorbed by)/generated from operations
(17,971)
36,957
22
Analysis of changes in net debt
1 January 2022
Cash flows
Other non-cash changes
30 June 2022
£
£
£
£
Cash at bank and in hand
297,354
(81,882)
-
215,472
Bank overdrafts
(302,192)
(313,832)
-
(616,024)
Cash and cash equivalents
(4,838)
(395,714)
-
(400,552)
Borrowings excluding overdrafts
(8,299,914)
615,999
(142,027)
(7,825,942)
Amounts owed to group undertakings
(13,579,884)
(1,551,237)
(15,131,121)
(21,884,636)
220,285
(1,693,264)
(23,357,615)
23
Prior period adjustment

Following the change of ownership and the incorporation of the Company into the group headed by Bluefield Solar Income Fund Limited, the ultimate parent company, the directors have considered the position of the Company and are of the opinion that the Company's investment in its subsidiaries ("SPVs") are held as part of an investment portfolio. As such, the Company should exclude all its SPVs from consolidation on the grounds set out in FRS 102 paragraph 9.9(b) and the SPVs should be measured at fair value recognised in statement of comprehensive income.

 

This change in accounting policy is required to be accounted for retrospectively and the relevant comparative figures have been restated.

Changes to the statement of financial position
As previously reported
Adjustment
As restated at 31 Dec 2021
£
£
£
Fixed assets
Investments
13,953,772
(13,953,772)
-
Financial assets at fair value through profit or loss
-
37,214,533
37,214,533
ST. JOHNS HILL WIND HOLDCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
23
Prior period adjustment
As previously reported
Adjustment
As restated at 31 Dec 2021
£
£
£
(Continued)
- 24 -
Current assets
Debtors due within one year
9,130,915
(8,963,815)
167,100
Cash at bank and in hand
297,354
-
297,354
Creditors due within one year
Other creditors
(15,731,136)
-
(15,731,136)
Creditors due after one year
Loans and overdrafts
(7,813,997)
-
(7,813,997)
Net (liabilities)/assets
(163,092)
14,296,946
14,133,854
Capital and reserves
Share capital
1,450,100
-
1,450,100
Profit and loss reserves
(1,613,192)
14,296,946
12,683,754
Total equity
(163,092)
14,296,946
14,133,854
Changes to the income statement
As previously reported
Adjustment
As restated
Period ended 31 December 2021
£
£
£
Turnover
129,000
-
129,000
Administrative expenses
(130,339)
-
(130,339)
Net gains on financial assets held at fair value through profit or loss
3,898,269
3,898,269
Operating loss
(1,339)
3,898,269
3,896,930
Interest receivable and similar income
643,079
(643,079)
-
Interest payable and similar expenses
(1,138,737)
-
(1,138,737)
(Loss)/profit before taxation
(496,997)
3,255,190
2,758,193
ST. JOHNS HILL WIND HOLDCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
23
Prior period adjustment
As previously reported
Adjustment
As restated
Period ended 31 December 2021
£
£
£
(Continued)
- 25 -
Reconciliation of changes in equity
1 January
31 December
2021
2021
£
£
Adjustments to prior period
Fair value adjustment
11,041,756
14,296,946
Equity as previously reported
333,905
(163,092)
Equity as adjusted
11,375,661
14,133,854
Analysis of the effect upon equity
Profit and loss reserves
11,041,756
14,296,946
Reconciliation of changes in (loss)/profit for the previous financial period
2021
£
Adjustments to prior period
Fair value adjustment
3,255,190
Loss as previously reported
(496,997)
Profit as adjusted
2,758,193
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