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Registered number: 03211154










FALCON INDUSTRIAL SERVICES LIMITED










ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022

 
FALCON INDUSTRIAL SERVICES LIMITED
 
 
COMPANY INFORMATION


DIRECTORS
S Belinghieri 
F Tenderini 
O G Ayagh 




COMPANY SECRETARY
Lea Secretaries Limited



REGISTERED NUMBER
03211154



REGISTERED OFFICE
5th Floor North Side 
7/10 Chandos Street
Cavendish Square

London

United Kingdom

W1G 9DQ




INDEPENDENT AUDITORS
Simmons Gainsford LLP
Chartered Accountants & Statutory Auditors

14th Floor

33 Cavendish Square

London

W1G 0PW





 
FALCON INDUSTRIAL SERVICES LIMITED
 

CONTENTS



Page
Group strategic report
1 - 5
Directors' report
6 - 7
Independent auditors' report
8 - 12
Consolidated statement of comprehensive income
13
Consolidated balance sheet
14 - 15
Company balance sheet
16 - 17
Consolidated statement of changes in equity
18 - 19
Company statement of changes in equity
20
Consolidated statement of cash flows
21 - 22
Consolidated analysis of net debt
23
Notes to the financial statements
24 - 48


 
FALCON INDUSTRIAL SERVICES LIMITED
 
 
GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022

INTRODUCTION
 
The directors present the strategic report for the year ended 31 December 2022.
The Company's principal activities continued to be those of holding investments in subsidiaries and other entities and in real estate investment, while the core business of the Group companies continued to be the support and administrative organization of disputes and litigations, provision of learning courses (CME - Continuing Medical Education Courses), digital services and 360 degrees advice for healthcare professionals.
In November 2022, Consulcesi Corporate SA ("CCSA") purchased from its parent company, Falcon Industrial Services Ltd, the investments in several subsidiaries (the “Group Deal”).
Afterward, Gyrus Capital purchased from Falcon Industrial Services Limited a minority interest, i.e., 40% of the shareholdings, in CCSA.

BUSINESS REVIEW
 
At the year ended 31 December 2022, the Group continued to show a positive profit. However, the profit decreased significantly comparing to 2021 which is mostly due to extra expenses relating to group restructure.  The total turnover in 2022 comparing to 2021 increased by 13% mainly due to turnover from subsidiaries purchased at the end of fiscal year 2021. The net assets of the group excluding non-controlling interest has increased by 21.7% and includes the net gains on the sale of 40% stake in CCSA amounting to €24m. 
The Group's reputation for the type of services provided has enabled it to remain successful in the markets in which it is operating. 
The Group, therefore, aims to maintain its high quality and good value service to its customers and to invest in internal resources (staff), structure (local offices) and marketing campaigns in order to win new customers (including a new class of Healthcare professional) and increase the market share in both existing and new countries (e.g. Albania, other EU countries), other than for the launch of new business lines (e.g. digital marketing and data management services to B2B clients).
Falcon group through Consulcesi Group, is uniquely positioned to continue its strong growth path through multiple value creation levers: consolidation of Legal business in Italy and Europe, improvement of Club value proposition through digitalization of product offered with the enhancement of new services through a new platform (”Club”). Investment in people, through a new organization that permits the group to grow in a strategic way, above all in B2B and marketing innovation. The development of additional value-added services and digital transformation, growth of B2B segment offering leveraging on Consulcesi brand awareness and distinctive competencies and evaluating M&A opportunities in the European market. 
Through achieving these aims, the Group expects to achieve further profits in the coming years and considers itself to be well placed to achieve growth within the current market.
We aim to present a balanced and comprehensive review of the development and performance of the business during the year and its position at the end of it. Our review is consistent with the size and nature of our business and is written in the context of the risks and uncertainties we face.

Page 1

 
FALCON INDUSTRIAL SERVICES LIMITED
 

GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022

PRINCIPAL RISKS AND UNCERTAINTIES
 
The Group's primary financial instrument is cash and cash equivalents arising from turnover generated by services provided by the Group companies, partially invested during 2022 in listed and unlisted securities / bonds and Exchange Traded Funds ("ETF").
The turnover of the B2C business lines is mostly generated by services provided for which the payments are received in advance and so the risk of unpaid debtors is close to zero. The trade debtors from the provision of the B2B services are monitored by the treasury department in order to ensure recovery of overdue debts, and our B2B customers are considered to have low risk company profiles.
Creditors and costs are mainly of an operative nature, to run the organisation and all its offices worldwide.
The Board continually monitors the cash requirements of the Group to ensure that the Group has ready access to the funds that the Board deem necessary at any time during the year. In addition, the Board continually monitors the cash invested in listed and unlisted securities / bonds and ETF, by ensuring that it is limited to a minor part of the total assets and that the portfolio is well balanced under a risk profile. The monitoring and review of future projections by the Board ensures also that there are adequate cash facilities either in house or on the market readily available from the Group’s finance providers to support the Group's cash flow requirements.
Main liquidity and cash flow risks are from investing and financing activities not covered by net cash generated from operating activities (considering that lawsuits promoted by the Group companies in favour of their clients may last for more than one year) as well as real estate and securities market fluctuation. The Group is maintaining a significant cash & cash equivalents positive position to prevent any liquidity risk.

FINANCIAL KEY PERFORMANCE INDICATORS
 
2022
2021
Variance
      €'000
      €'000
        %
Turnover

53,119

47,106

13
 
 
Gross profit

26,553

22,507

18
 
 
Operating profit

15,559

17,924

(13)
 
 
Profit for the financial year

9,952

14,162

(30)
 
 
Net assets

92,115

68,569

34
 
 

OTHER KEY PERFORMANCE INDICATORS
 
The Group at the end of 2022, held cash at bank and in hand amounting to €45,938,714 which is an increase of €28,957,484 compared to 2021 mainly due to the sale of the minority interest in Consulcesi Corporate SA ("CCSA"). 
In 2022, the amount of CME courses accredited and published on the platform by the Group companies were 231, of which 73 were new courses produced (compared to 307 CME courses accredited and published on the platform in 2021). This decrease reflects the decision to invest only in profitable courses.
The Board continually monitors other business statistics (e.g. number of new litigation cases taken on, number of ‘Consulcesi Club’ clients, number of courses subscribed, redemptions) to ensure the development and performance of the business. 

Page 2

 
FALCON INDUSTRIAL SERVICES LIMITED
 

GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022

DIRECTORS' STATEMENT OF COMPLIANCE WITH DUTY TO PROMOTE THE SUCCESS OF THE GROUP
 
Who we are and what we do
The Group is one of the most relevant European providers of services to Healthcare Professionals (HCPs) and Healthcare companies, mainly active in Legal and in the Continuing Medical Education businesses (CME), with solid performances and outstanding profitability consistently over last years. 
Since its foundation, the main shareholder, the directors and the management team have implemented a successful strategy which led to the development of a distinctive positioning in the reference markets and a superior value proposition.
The Group is structured as a network company where each entity is responsible for a specific activity of the value chain, facilitating specialization and vertical knowledge development.
The Group along its growth path evolved as a 360-degree service provider for physicians, answering HCPs crucial ‘pain points’: to have a reliable support carrying on collective legal actions (“Class Actions”) and to have a digital base platform acting as single point of contact for Continuous Medical Education (CME), Legal protection and other profession related services.
The offering is organized in 3 business lines (Legal, Club and B2B), targeting both B2C and B2B segments and presently has its cornerstone in one of the largest HCPs databases in Italy with privacy agreements. The Database is a key asset for the firm, providing a significant advantage in sales operations and in client management activities.
The operating model is kept in-house to grant quality and flexibility, exploiting the ‘network model’ and the specialization of the Group companies in terms of commercial activities, production of contents / delivery of services for B2C clients, internal services and production of contents / delivery of services for B2B clients.
The Role of the Board
The Board’s primary responsibility is to promote the long-term success of the Group by delivering projects that meet the client’s expectations and the shareholders’ targets.
This is affected by setting out the Group strategy with the ongoing performance monitoring. The Board (at both Group and local Group companies’ level) holds Board meetings periodically to review the main aspects of the business, including financial reviews and forecasts, resources, internal controls, performance, opportunities and risks.
All directors are directly responsible for and involved in all projects with day-to-day management carried out by senior management and must act in the way he/she considers, in good faith, would be most likely to promote the success of the company for the benefit of its members as a whole, and in doing so have regard to key issues including the interests of the stakeholders in both the short and long term.
1. The likely consequence of any decision in the long-term
Consulcesi is a one-of-a-kind company with distinctive offering centred on HCPs encompassing Legal, Education and other services.
The Company has a unique coverage of the legal market Key Success Factors, turning its business model into a winning competitive advantage guaranteeing also a sustainable and distinctive competitive positioning, effectively representing solid market entry barriers. 
Legal Italian market is composed of heterogeneous players where the Company mainly competes with specialized class actions providers by providing full focus on class actions, leveraging its commercial strength
Page 3

 
FALCON INDUSTRIAL SERVICES LIMITED
 

GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022

and the specifically designed operating model, supporting clients throughout the process offering favourable conditions unleashing economies of scale. The Company is the only market relevant provider fully focused on collective actions for HCPs.
The global continuing medical education (CME) market size reached Eur. 7.35 billion in 2021. Looking forward, the market expectation is to reach Eur. 10.7 billion by 2027, exhibiting a compound annual growth rate (CAGR) of 6.46% during 2022-2027.
All European countries show an evolution path towards the E-Learning Methodology. E-Learning presents the highest expected growth leveraging on digitalization significantly accelerated by COVID-19.
Consulcesi is uniquely positioned to continue its strong growth path through multiple value creation levers:
      • Consolidation of Legal business in Italy
      • Improvement of Club value proposition through the development of additional value-added services
      • Growth of B2B segment offering leveraging on Consulcesi brand awareness and distinctive competencies
      • M&A and partnerships initiatives in Italy
      • Club business international expansion in selected countries
      • Additional growth opportunities and investments to be pursued on an opportunistic basis
2. The interest of the Group’s employees
The Directors (at both Group and local Group companies’ level) understand the importance of the employees to the long-term success of the business, and being closely involved in the day-to-day operations of the business are familiar with each employee and thus able to assess their performance and provide guidance and further training as necessary.
The Group aims to recruit and retain motivated and competent people and believe in promotion as reward for performance and dedication, and to demonstrate a clear path for progression, combined with a well-structured and advanced MBO process.
The Group has a well-developed intranet allowing the employees to easily access any information that they need, both on a project and corporate basis, and social media channels are developing to enhance communication and employee feedback.
3. The need to foster the Group’s business relationships with suppliers, customers and others
The Group has always believed that good business relationships with clients and suppliers, is key to the ongoing success, and the Directors (at both Group and local Group companies’ level) develop close relationships with them to ensure that we fully understand each other’s strategies and objectives and are able to support each other in achieving them.
The operating model is based on in-house activities to maximize the client service effectiveness and the process efficiency. The Group has developed over the years a fully dedicated hub to customers care services with superior IT support.
4. The impact of the Group’s operations on the community and environment
The Group has developed a high reputation in the community and is keen to maintain it over the time, also through liberalities and promotion of new initiatives.
The Group is also committed to protecting the environment. We acknowledge that the pursuit of economic growth and respect for the environment must be closely linked, with sustainable development being an integral part of our business philosophy and processes.
We work on the basis that compliance with environmental legislation, and other requirements, is the very
Page 4

 
FALCON INDUSTRIAL SERVICES LIMITED
 

GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022

minimum that will apply to our activities and services and we are committed to continual environmental performance improvement, the prevention of pollution and having a positive impact on the environment.
We work closely with our clients and suppliers, encouraging and educating our employees and supply chain to recognise their responsibilities regarding protecting the environment and achieving our environmental objectives and targets and communicating and consulting with all stakeholders as appropriate.
5. The desirability of the Group maintaining a reputation for high standards of business conduct
The Group’s high standards in the way we run the business and deal with all stakeholders, and our commitment to be the best have been the key to the ongoing success.
Key to this is the experience and ongoing professionalism and commitment of our employees and we continually strive to make our Company a place where all enjoy their work and have the opportunity to progress.
We have a Policy of promoting continual improvement and the setting of quality objectives and improvement programmes within the Group.
These objectives address the risks and opportunities within the Group, as determined by Senior Management, and we believe that Quality is critical to the success of our business, and base our approach on the key quality principles of customer focus, leadership, engagement of people, process approach, improvement and relationship management.
6. The need to act fairly as between members of the Group
Strategy and decisions by the Board are carefully considered in both the short and long term and the Directors are fully aware of the need to take into account all relevant factors to achieve a fair balance between members of the Group.
The overriding objective is to ensure that the Group maintains its reputation for quality and integrity so as to continue as a successful and sustainable business for the long-term benefit of the members.


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




................................................
S Belinghieri
Director

Date: 16 November 2023

Page 5

 
FALCON INDUSTRIAL SERVICES LIMITED
 
 
 
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022

The directors present their report and the financial statements for the year ended 31 December 2022.

DIRECTORS' RESPONSIBILITIES STATEMENT

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

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


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

make 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;

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.

PRINCIPAL ACTIVITY

The Company's principal activities continued to be those of holding of participations and real estate investment, while the core business of the Group companies continued to be the support and administrative organization of disputes and litigations, provision of learning courses (CME - Continuing Medical Education Courses), digital services and 360 degrees advice for healthcare professionals.

RESULTS AND DIVIDENDS

The profit for the year, after taxation and minority interests, amounted to 9,261,598 (2021 - 14,092,796).

During the year, the company paid dividends of €16,557,694 (2021: €17,484,827).

DIRECTORS

The directors who served during the year were:

S Belinghieri 
F Tenderini 
S C Roncoroni (resigned 30 September 2022)
O G Ayagh (appointed 16 September 2022)


Page 6

 
FALCON INDUSTRIAL SERVICES LIMITED
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022

MATTERS COVERED IN THE STRATEGIC REPORT

Information regarding the Company's and Group's principal risks and uncertainties is included within the Strategic Report.

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 auditorsSimmons Gainsford LLPwill be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

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




................................................
S Belinghieri
Director

Date: 16 November 2023

Page 7

 
FALCON INDUSTRIAL SERVICES LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF FALCON INDUSTRIAL SERVICES LIMITED
 

OPINION


We have audited the financial statements of Falcon Industrial Services Limited (the 'parent Company') and its subsidiaries (the 'Group') for the year ended 31 December 2022, which comprise the Consolidated statement of comprehensive income, the Consolidated balance sheet, the Company balance sheet, the Consolidated statement of cash flows, the Consolidated statement of changes in equity, the Company statement of changes in equity and the related notes, including a summary of significant accounting policiesThe financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).


In our opinion the financial statements:


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


BASIS FOR OPINION


We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the Group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council's Ethical Standard and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.


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 8

 
FALCON INDUSTRIAL SERVICES LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF FALCON INDUSTRIAL SERVICES LIMITED (CONTINUED)


OTHER INFORMATION


The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' report thereon. The directors are responsible for the other information contained within the Annual ReportOur opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.


We have nothing to report in this regard.


OPINION ON OTHER MATTERS PRESCRIBED BY THE COMPANIES ACT 2006
 

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


the information given in the Group strategic report and the Directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the Group strategic report and the Directors' report have been prepared in accordance with applicable legal requirements.


MATTERS ON WHICH WE ARE REQUIRED TO REPORT BY EXCEPTION
 

In the light of the knowledge and understanding of the Group and the parent Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group strategic report or the Directors' report.


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.


Page 9

 
FALCON INDUSTRIAL SERVICES LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF FALCON INDUSTRIAL SERVICES LIMITED (CONTINUED)


RESPONSIBILITIES OF DIRECTORS
 

As explained more fully in the Directors' responsibilities statement set out on page 6, 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.


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 Group financial statements.


Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

In order to identify and assess the risks of material misstatements, including fraud and non-compliance with laws and regulations that could be expected to have a material impact on the financial statements, we have considered:

the results of our enquiries of management and those charged with governance of their assessment of the risks of fraud and irregularities;
the nature of the group, including its management structure and control systems (including the opportunity for management to override such controls);
management’s incentives and opportunities for fraudulent manipulation of the financial statements; and 
the industry and environment in which it operates.

We also considered UK tax and pension legislation and laws and regulations relating to employment and the preparation and presentation of the financial statements such as the Companies Act 2006.

Based on this understanding we identified the following matters as being of significance to the entity:

laws and regulations considered to have a direct effect on the financial statements including UK financial reporting standards, Company Law, tax and pension legislation and distributable profits legislation;
the timing of the recognition of commercial income;
compliance with legislation relating to local employment law; 
management bias in selecting accounting policies and determining estimates;
inappropriate journal entries;
recoverability of debtors; and
the requirement to impair the intangible assets and the fixed asset investments, and the amount of any such impairment. 

Page 10

 
FALCON INDUSTRIAL SERVICES LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF FALCON INDUSTRIAL SERVICES LIMITED (CONTINUED)


We communicated the outcomes of these discussions and enquiries, as well as consideration as to where and how fraud may occur in the entity, to all engagement team members including the auditors of significant components.

Audit procedures undertaken in response to the potential risks relating to irregularities (which include fraud and non-compliance with laws and regulations) comprised: 

enquiries of management and those charged with governance as to whether the entity complies with such laws and regulations;
enquiries with the same concerning any actual or potential litigation or claims;
discussion with the same regarding any known or suspected instances of non-compliance with laws and regulation and fraud; 
inspection of relevant legal correspondence;
assessment of matters reported to management and the result of the subsequent investigation;
obtaining an understanding of the relevant controls during the period;
obtaining an understanding of the policies and controls over the recognition of income and testing their implementation during the year;
review documentation relating to compliance with the regulations;
challenging assumptions made by management in their specific accounting policies and estimates, in particular in relation to costs of the stock;
identifying and testing journal entries, in particular any journal entries posted with unusual account combinations or crediting revenue or cash;
assessing the recovery of debtors in the period since the balance sheet date and challenging assumptions made by management regarding the recovery of balances which remain outstanding;
challenging key assumptions made by management in their assessment of any impairment to the carrying value of the fixed asset investments and intangible assets;
reviewing the financial statements for compliance with the relevant disclosure requirements; 
performing analytical procedures to identify any unusual or unexpected relationships or unexpected movements in account balances which may be indicative of fraud;
reviewing the minutes of Board meetings and correspondence with HMRC;
evaluating the underlying business reasons for any unusual transactions; and
considered the implementation of controls during the year.

No instances of material non-compliance were identified. However, the likelihood of detecting irregularities, including fraud, is limited by the inherent difficulty in detecting irregularities, the effectiveness of the entity’s controls, and the nature, timing and extent of the audit procedures performed. Irregularities that result from fraud might be inherently more difficult to detect than irregularities that result from error. As explained above, there is an unavoidable risk that material misstatements may not be detected, even though the audit has been planned and performed in accordance with ISAs (UK).


A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditors' report.


Page 11

 
FALCON INDUSTRIAL SERVICES LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF FALCON INDUSTRIAL SERVICES LIMITED (CONTINUED)


USE OF OUR REPORT
 

This report is made solely to the Company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in an 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.





Shilen Manek ACA FCCA (Senior statutory auditor)
for and on behalf of
Simmons Gainsford LLP
Chartered Accountants
Statutory Auditors
14th Floor
33 Cavendish Square
London
W1G 0PW

16 November 2023
Page 12

 
FALCON INDUSTRIAL SERVICES LIMITED
 
 
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2022

2022
2021
Note

  

Turnover
 4 
53,119,318
47,105,484

Cost of sales
  
(26,566,459)
(24,598,494)

Gross profit
  
26,552,859
22,506,990

Exceptional other operating charges
 15 
(1,049,601)
-

Administrative expenses
  
(8,320,900)
(6,515,516)

Other operating income
 5 
98,481
1,563

Fair value movements
 7
(1,721,342)
1,930,994

Operating profit
 6 
15,559,497
17,924,031

Income from fixed assets investments
  
1,313
197

Profit/(loss) on disposal of investments
  
(761,863)
(389,722)

Interest receivable and similar income
 12 
57,842
229,896

Interest payable and similar expenses
 13 
(564,695)
(156,239)

Profit before taxation
  
14,292,094
17,608,163

Tax on profit
 14 
(4,340,306)
(3,446,163)

Profit for the financial year
  
9,951,788
14,162,000

  

Currency translation differences on foreign currency net investments
  
(1,257,039)
816,945

Other comprehensive income for the year
  
(1,257,039)
816,945

Total comprehensive income for the year
  
8,694,749
14,978,945

Profit for the year attributable to:
  

Non-controlling interests
  
690,190
69,204

Owners of the parent Company
  
9,261,598
14,092,796

  
9,951,788
14,162,000

Total comprehensive income for the year attributable to:
  

Non-controlling interest
  
690,190
69,204

Owners of the parent Company
  
8,004,559
14,909,741

  
8,694,749
14,978,945

The notes on pages 24 to 48 form part of these financial statements.

Page 13

 
FALCON INDUSTRIAL SERVICES LIMITED
REGISTERED NUMBER: 03211154

CONSOLIDATED BALANCE SHEET
AS AT 31 DECEMBER 2022

2022
2021
Note

Fixed assets
  

Intangible assets
 16 
5,782,230
5,865,185

Tangible assets
 17 
5,199,285
14,432,771

Investments
 18 
12,678,598
15,746,951

Investment property
 19 
14,773,645
6,012,761

  
38,433,758
42,057,668

Current assets
  

Stocks
 20 
10,987,444
10,987,444

Debtors: amounts falling due within one year
 21 
21,712,835
18,633,213

Current asset investments
 22 
2,929,343
8,689,131

Cash at bank and in hand
 23 
45,938,732
16,981,250

  
81,568,354
55,291,038

Creditors: amounts falling due within one year
 24 
(23,430,405)
(22,750,400)

Net current assets
  
 
 
58,137,949
 
 
32,540,638

Total assets less current liabilities
  
96,571,707
74,598,306

Creditors: amounts falling due after more than one year
 25 
(4,456,782)
(6,029,251)

Net assets
  
92,114,925
68,569,055


Capital and reserves
  

Called up share capital 
 28 
1,888,236
1,888,236

Foreign exchange reserve
 29 
(734,973)
522,066

Other reserves
 29 
339,396
339,396

Profit and loss account
 29 
80,435,871
64,530,113

Equity attributable to owners of the parent Company
  
81,928,530
67,279,811

Non-controlling interests
  
10,186,395
1,289,244

  
92,114,925
68,569,055


Page 14

 
FALCON INDUSTRIAL SERVICES LIMITED
REGISTERED NUMBER: 03211154
    
CONSOLIDATED BALANCE SHEET (CONTINUED)
AS AT 31 DECEMBER 2022

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




................................................
S Belinghieri
Director
Date: 16 November 2023

Page 15

 
FALCON INDUSTRIAL SERVICES LIMITED
REGISTERED NUMBER: 03211154

COMPANY BALANCE SHEET
AS AT 31 DECEMBER 2022

2022
2021
Note

Fixed assets
  

Investments
 18 
103,220,170
35,369,871

  
103,220,170
35,369,871

Current assets
  

Stocks
 20 
10,987,444
10,987,444

Debtors: amounts falling due within one year
 21 
861,689
3,706,060

Current asset investments
 22 
2,929,343
2,493,936

Cash at bank and in hand
 23 
33,616,248
3,402,060

  
48,394,724
20,589,500

Creditors: amounts falling due within one year
 24 
(3,413,544)
(6,686,478)

Net current assets
  
 
 
44,981,180
 
 
13,903,022

Total assets less current liabilities
  
148,201,350
49,272,893

  

Creditors: amounts falling due after more than one year
 25 
(76,095)
(80,206)

  

Net assets excluding pension asset
  
148,125,255
49,192,687

Net assets
  
148,125,255
49,192,687


Capital and reserves
  

Called up share capital 
 28 
1,888,236
1,888,236

Foreign exchange reserve
 29 
(5,424,275)
603,221

Other reserves
 29 
71,995,423
-

Profit and loss account
 29 
79,665,871
46,701,230

  
148,125,255
49,192,687


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 profit after tax of the parent Company for the year was €121,517,758 (2021: €26,709,373).
 
Page 16

 
FALCON INDUSTRIAL SERVICES LIMITED
REGISTERED NUMBER: 03211154
    
COMPANY BALANCE SHEET (CONTINUED)
AS AT 31 DECEMBER 2022

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




................................................
S Belinghieri
Director

Date: 16 November 2023

The notes on pages 24 to 48 form part of these financial statements.

Page 17

 

 
FALCON INDUSTRIAL SERVICES LIMITED


 

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



Called up share capital
Foreign exchange reserve
Other reserves
Profit and loss account
Equity attributable to owners of parent Company
Non-controlling interests
Total equity




At 1 January 2022
1,888,236
522,066
339,396
64,530,113
67,279,811
1,289,244
68,569,055



Comprehensive income for the year


Profit for the year
-
-
-
9,261,598
9,261,598
690,190
9,951,788


Currency translation differences on foreign currency net investments
-
(1,257,039)
-
-
(1,257,039)
-
(1,257,039)



Other comprehensive income for the year
-
(1,257,039)
-
-
(1,257,039)
-
(1,257,039)



Total comprehensive income for the year
-
(1,257,039)
-
9,261,598
8,004,559
690,190
8,694,749



Contributions by and distributions to owners


Dividends: Equity capital
-
-
-
(16,557,694)
(16,557,694)
-
(16,557,694)


Gain on part disposal of subsidiaries
-
-
-
24,005,785
24,005,785
9,003,030
33,008,815


NCI acquired
-
-
-
(803,931)
(803,931)
(796,069)
(1,600,000)



At 31 December 2022
1,888,236
(734,973)
339,396
80,435,871
81,928,530
10,186,395
92,114,925



The notes on pages 24 to 48 form part of these financial statements.

Page 18

 

 
FALCON INDUSTRIAL SERVICES LIMITED


 

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2021



Called up share capital
Foreign exchange reserve
Other reserves
Profit and loss account
Equity attributable to owners of parent Company
Non-controlling interests
Total equity




At 1 January 2021
1,888,236
(294,879)
339,396
68,044,644
69,977,397
430,490
70,407,887



Comprehensive income for the year


Profit for the year
-
-
-
14,092,796
14,092,796
69,204
14,162,000


Currency translation differences on foreign currency net investments
-
816,945
-
-
816,945
-
816,945


NCI interest in Capital Contribution to subsidiary
-
-
-
(122,500)
(122,500)
122,500
-



Other comprehensive income for the year
-
816,945
-
(122,500)
694,445
122,500
816,945



Total comprehensive income for the year
-
816,945
-
13,970,296
14,787,241
191,704
14,978,945



Contributions by and distributions to owners


Dividends: Equity capital
-
-
-
(17,484,827)
(17,484,827)
-
(17,484,827)


Non-controlling interest from acquisition
-
-
-
-
-
642,550
642,550


NCI acquisition of shares in subsidiaries
-
-
-
-
-
24,500
24,500



At 31 December 2021
1,888,236
522,066
339,396
64,530,113
67,279,811
1,289,244
68,569,055



The notes on pages 24 to 48 form part of these financial statements.

Page 19

 
FALCON INDUSTRIAL SERVICES LIMITED
 

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


Called up share capital
Foreign exchange reserve
Other reserves
Profit and loss account
Total equity



At 1 January 2021
1,888,236
(121,289)
-
37,476,684
39,243,631


Comprehensive income for the year

Profit for the year
-
-
-
26,709,373
26,709,373

Currency translation differences on foreign currency net investments
-
724,510
-
-
724,510


Other comprehensive income for the year
-
724,510
-
-
724,510


Total comprehensive income for the year
-
724,510
-
26,709,373
27,433,883


Contributions by and distributions to owners

Dividends: Equity capital
-
-
-
(17,484,827)
(17,484,827)



At 1 January 2022
1,888,236
603,221
-
46,701,230
49,192,687


Comprehensive income for the year

Profit for the year
-
-
-
121,517,758
121,517,758

Currency translation differences on foreign currency net investments
-
(6,027,496)
-
-
(6,027,496)


Other comprehensive income for the year
-
(6,027,496)
-
-
(6,027,496)


Contributions by and distributions to owners

Dividends: Equity capital
-
-
-
(16,557,694)
(16,557,694)

Transfer to/from profit and loss account
-
-
71,995,423
(71,995,423)
-


At 31 December 2022
1,888,236
(5,424,275)
71,995,423
79,665,871
148,125,255


The notes on pages 24 to 48 form part of these financial statements.

Page 20

 
FALCON INDUSTRIAL SERVICES LIMITED
 

CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2022

2022
2021

Cash flows from operating activities

Profit for the financial year
9,951,788
14,162,000

Adjustments for:

Amortisation of intangible assets
610,025
45,657

Depreciation of tangible assets
1,045,050
1,269,051

Impairments of fixed assets
1,202,986
2,885

Loss on disposal of tangible assets
40,875
29,246

Interest paid
564,695
156,239

Interest received
(57,842)
(229,896)

Taxation charge
4,340,306
3,446,163

Decrease in debtors
4,967,411
52,017,347

(Decrease) in creditors
(3,021,851)
(49,992,187)

Net fair value losses/(gains) recognised in P&L
1,721,342
(1,930,994)

Corporation tax (paid)
(9,732,423)
(6,196,181)

(Profit)/Loss on disposal of current asset investments
(20,421)
389,722

(Profit)/Loss on disposal of fixed asset investments
(386,249)
-

Net cash generated from operating activities

11,225,692
13,169,052


Cash flows from investing activities

Purchase of intangible fixed assets
(577,070)
(35,533)

Sale of intangible assets
50,000
10,407

Purchase of tangible fixed assets
(573,142)
(5,170,600)

Purchase of investment properties
-
(1,797,723)

Purchase of unlisted and other investments
(295,350)
(8,489,590)

Sale of unlisted and other investments
1,167,771
2,632,058

Purchase of short-term listed investments
(1,803,931)
(7,002,711)

Sale of short-term listed investments
7,336,070
10,337,107

Purchase of fixed asset investments
-
(4,790,880)

Sale of shares in subsidiaries
33,008,815
-

Interest received
57,842
229,896

New loans to related parties
-
(2,750,000)

Purchase of minority interest in subsidiaries
(1,600,000)
-

Net cash from investing activities

36,771,005
(16,827,569)
Page 21

 
FALCON INDUSTRIAL SERVICES LIMITED
 

CONSOLIDATED STATEMENT OF CASH FLOWS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022


2022
2021




Cash flows from financing activities

New secured loans
221,649
2,388,255

Repayment of loans
(747,104)
(421,340)

Dividends paid
(16,557,694)
(9,160,000)

Interest paid
(564,695)
(156,239)

New shares issued in subsidiaries purchased by NCI
-
24,500

Net cash used in financing activities
(17,647,844)
(7,324,824)

Net increase/(decrease) in cash and cash equivalents
30,348,853
(10,983,341)

Cash and cash equivalents at beginning of year
16,981,230
26,775,367

Foreign exchange gains and losses
(1,391,369)
1,189,204

Cash and cash equivalents at the end of year
45,938,714
16,981,230


Cash and cash equivalents at the end of year comprise:

Cash at bank and in hand
45,938,733
16,981,250

Bank overdrafts
(19)
(20)

45,938,714
16,981,230



The notes on pages 24 to 48 form part of these financial statements.

Page 22

 
FALCON INDUSTRIAL SERVICES LIMITED
 

CONSOLIDATED ANALYSIS OF NET DEBT
FOR THE YEAR ENDED 31 DECEMBER 2022






At 1 January 2022
Cash flows
Changes in market value and foreign exchange movements
Other non-cash changes
At 31 December 2022





Cash at bank and in hand

16,981,250

30,259,072

(1,301,589)

-

45,938,733

Bank overdrafts

(20)

1

-

-

(19)

Debt due after 1 year

(5,773,096)

(221,649)

532

1,760,553

(4,233,660)

Debt due within 1 year

(3,355,765)

747,104

-

(1,760,553)

(4,369,214)

Liquid investments

8,689,131

(5,532,139)

(227,649)

-

2,929,343

Net debt


16,541,500
25,252,389
(1,528,706)
-
40,265,183


The notes on pages 24 to 48 form part of these financial statements.

Page 23

 
FALCON INDUSTRIAL SERVICES LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

1.


GENERAL INFORMATION

Falcon Industrial Services Limited is a company limited by shares and registered in England and Wales under registration number 03211154. The registered and principal trading office is 5th Floor North Side, 7/10 Chandos Street, Cavendish Square, London, W1G 9DQ. 

2.ACCOUNTING POLICIES

 
2.1

BASIS OF PREPARATION OF FINANCIAL STATEMENTS

The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.

The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires 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.

In preparing the separate financial statements of the parent company, advantage has been taken of the following disclosure exemptions available in FRS 102:
-  The requirement to present a statement of cash flows and related notes
-  The total amount of key management personnel compensation
- Financial instrument disclosures, including categories of financial instruments, items of income,     expenses, gains or losses relating to financial instruments, and exposure to and management of financial risks.

The following principal accounting policies have been applied:

 
2.2

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 consolidated financial statements incorporate the results of business combinations using the purchase method. In the Balance sheet, the acquiree's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquired operations are included in the Consolidated statement of comprehensive income from the date on which control is obtained. They are deconsolidated from the date control ceases.
In accordance with the transitional exemption available in FRS 102, the Group has chosen not to retrospectively apply the standard to business combinations that occurred before the date of transition to FRS 102, being 31 December 2014.

Page 24

 
FALCON INDUSTRIAL SERVICES LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

2.ACCOUNTING POLICIES (CONTINUED)

 
2.3

FOREIGN CURRENCY TRANSLATION

Functional and presentation currency

The Group's functional and presentational currency is Euros. The Company's functional currency is Sterling but the accounts have been presented in Euros.

Transactions and balances

Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.

At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.

Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss except when deferred in other comprehensive income as qualifying cash flow hedges.

Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the Consolidated statement of comprehensive income within 'finance income or costs'. All other foreign exchange gains and losses are presented in profit or loss within 'other operating income'.

On consolidation, the results of overseas operations are translated into Euros at rates approximating to those ruling when the transactions took place. All assets and liabilities of overseas operations are translated at the rate ruling at the reporting date. Exchange differences arising on translating the opening net assets at opening rate and the results of overseas operations at actual rate are recognised in other comprehensive income.

Page 25

 
FALCON INDUSTRIAL SERVICES LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

2.ACCOUNTING POLICIES (CONTINUED)

 
2.4

REVENUE

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised:

Sale of property
Revenue represents the gross proceeds on the sale of properties completed during the year.
Rendering of services
Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:
• the amount of revenue can be measured reliably;
• it is probable that the Group will receive the consideration due under the contract;
• the stage of completion of the contract at the end of the reporting period can be measured reliably; and
• the costs incurred and the costs to complete the contract can be measured reliably.

 
2.5

INTEREST INCOME

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

 
2.6

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.

 
2.7

TAXATION

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.

 
2.8

EXCEPTIONAL ITEMS

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

Page 26

 
FALCON INDUSTRIAL SERVICES LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

2.ACCOUNTING POLICIES (CONTINUED)

 
2.9

INTANGIBLE ASSETS

Goodwill
Goodwill represents the difference between amounts paid on the cost of a business combination and the acquirer’s interest in the fair value of the Group's share of its identifiable assets and liabilities of the acquiree at the date of acquisition. Subsequent to initial recognition, goodwill is measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is amortised on a straight-line basis to the Consolidated statement of comprehensive income over its useful economic life.
Other intangible assets
Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.

 
2.10

TANGIBLE FIXED ASSETS

Tangible fixed assets under the cost model, other than investment properties, 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.

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:

Freehold property
-
Plant and machinery
-
12% - 25% Straight line
Fixtures and fittings
-
25% Straight line
Office equipment
-
25% - 50% Straight line

The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.

Page 27

 
FALCON INDUSTRIAL SERVICES LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

2.ACCOUNTING POLICIES (CONTINUED)

 
2.11

IMPAIRMENT OF FIXED ASSETS AND GOODWILL

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

 
2.12

INVESTMENT PROPERTY

Investment property is carried at fair value determined annually by the directors 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.

 
2.13

VALUATION OF INVESTMENTS

Investments in subsidiaries are measured at cost less accumulated impairment.

Investments in unlisted shares, whose market value can be reliably determined, are remeasured to market value at each balance sheet date. Gains and losses on remeasurement are recognised in the Consolidated statement of comprehensive income for the period. Where market value cannot be reliably determined, such investments are stated at historic cost less impairment.

Investments in listed company shares are remeasured to market value at each balance sheet date. Gains and losses on remeasurement are recognised in profit or loss for the period.

 
2.14

STOCKS

Stock comprises properties, which are valued at the lower of cost and estimated selling price less costs to complete and sell. 
At each balance sheet date, stock is 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 in the Statement of Comprehensive Income. 

 
2.15

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.

Page 28

 
FALCON INDUSTRIAL SERVICES LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

2.ACCOUNTING POLICIES (CONTINUED)

 
2.16

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.

In the Consolidated statement of cash flows, cash and cash equivalents are shown net of bank overdrafts that are repayable on demand and form an integral part of the Group's cash management.

 
2.17

CREDITORS

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

 
2.18

FINANCIAL INSTRUMENTS

The Group has elected to apply the provisions of Section 11 “Basic Financial Instruments” of FRS 102 to all of its financial instruments.

Financial instruments are recognised in the Group's Balance sheet when the Group becomes party to the contractual provisions of the instrument.

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

Basic financial assets

Basic financial assets, which include trade and other receivables, cash and bank balances, are initially measured at their transaction price including transaction costs and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest.

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

Other financial assets

Other financial assets, which includes investments in equity instruments which are not classified as subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the recognised transaction price. Such assets are subsequently measured at fair value with the changes in fair value being recognised in the profit or loss. Where other financial assets are not publicly traded, hence their fair value cannot be measured reliably, they are measured at cost less impairment.

Impairment of financial assets

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

Page 29

 
FALCON INDUSTRIAL SERVICES LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

2.ACCOUNTING POLICIES (CONTINUED)


2.18
FINANCIAL INSTRUMENTS (continued)

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

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

Financial liabilities

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

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

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

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

Derecognition of financial instruments

Derecognition of financial assets

Financial assets are derecognised when their contractual right to future cash flow expire, or are settled, or when the Group transfers the asset and substantially all the risks and rewards of ownership to another party. If significant risks and rewards of ownership are retained after the transfer to another party, then the Group will continue to recognise the value of the portion of the risks and rewards retained.

Derecognition of financial liabilities

Financial liabilities are derecognised when the Group's contractual obligations expire or are discharged or cancelled.

Page 30

 
FALCON INDUSTRIAL SERVICES LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

2.ACCOUNTING POLICIES (CONTINUED)

 
2.19

DIVIDENDS

Equity dividends are recognised when they become legally payable. Interim equity dividends are recognised when paid. Final equity dividends are recognised when approved by the shareholders at an annual general meeting.


3.



JUDGEMENTS IN APPLYING ACCOUNTING POLICIES AND KEY SOURCES OF ESTIMATION UNCERTAINTY

Estimates and judgments are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.
The group makes estimates and assumptions concerning the future. Actual results may differ from these estimates. 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.
The directors consider followings as significant areas of judgments or key sources of estimation uncertainty:
Depreciation and amortisation
The directors exercise judgement in the determination of the useful economic lives and residual value of all classes of fixed assets. These assets are then depreciated over their useful economic lives to their residual balances.
Valuation of investment properties
The directors exercise judgement regarding the valuation of investment properties.

Page 31

 
FALCON INDUSTRIAL SERVICES LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

4.


TURNOVER

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


2022
2021

Sale of training courses
49,225,813
43,779,946

Success fees from legal cases
3,266,423
2,691,764

Rental income
627,082
633,774

53,119,318
47,105,484


Analysis of turnover by country of destination:

2022
2021

Europe
53,119,318
47,105,484

53,119,318
47,105,484



5.


OTHER OPERATING INCOME

2022
2021

Other operating income
98,481
1,563

98,481
1,563



6.


OPERATING PROFIT

The operating profit is stated after charging:

2022
2021

Depreciation of tangible assets
1,004,869
1,081,625

Amortisation of intangible assets, including goodwill
610,025
45,657

Exchange differences
(721,619)
(200,571)

Page 32

 
FALCON INDUSTRIAL SERVICES LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

7.


FAIR VALUE MOVEMENTS

2022
2021
Listed investments - fair value movement

(1,721,342)

1,930,994
 
(1,721,342)

1,930,994
 


8.


AUDITORS' REMUNERATION

During the year, the Group obtained the following services from the Company's auditors and their associates


2022
2021

Fees payable to the Group's auditor and its associates for the audit of the Group's annual financial statements

55,720
40,573


9.


EMPLOYEES

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


Group
Group
Company
Company
2022
2021
2022
2021


Wages and salaries
15,122,933
13,393,805
40,826
6,897

Social security costs
1,922,761
1,700,425
-
-

Cost of defined contribution scheme
207,252
264,570
-
-

17,252,946
15,358,800
40,826
6,897


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



Group
Group
Company
Company
        2022
        2021
        2022
        2021
            No.
            No.
            No.
            No.









Sales and administration
436
441
3
3

Page 33

 
FALCON INDUSTRIAL SERVICES LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

10.


DIRECTORS' REMUNERATION

2022
2021

Directors' emoluments
40,826
6,897

40,826
6,897


Apart from the directors there were no other key management personnel. 


11.


INCOME FROM INVESTMENTS

2022
2021


Income from listed investments
1,313
197

1,313
197




12.


INTEREST RECEIVABLE

2022
2021


Other interest receivable
57,842
229,896

57,842
229,896


13.


INTEREST PAYABLE AND SIMILAR EXPENSES

2022
2021


Bank interest payable
156,032
155,789

Other loan interest payable
408,663
450

564,695
156,239

Page 34

 
FALCON INDUSTRIAL SERVICES LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

14.


TAXATION


2022
2021

Corporation tax


Current tax on profits for the year
(35,187)
-

Foreign tax


Foreign tax on income for the year
3,689,542
3,446,163

Foreign tax in respect of prior periods
685,951
-

4,375,493
3,446,163

Total current tax
4,340,306
3,446,163

FACTORS AFFECTING TAX CHARGE FOR THE YEAR

The tax assessed for the year is higher than (2021 - higher than) the standard rate of corporation tax in the UK of 19% (2021 - 19%). The differences are explained below:

2022
2021


Profit on ordinary activities before tax
14,292,094
17,608,163


Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 19% (2021 - 19%)
2,715,498
3,337,683

Effects of:


Higher rate taxes on overseas earnings
204,981
108,480

Adjustments to tax charge in respect of prior periods
685,951
-

Unrelieved tax losses carried forward
733,876
-

Total tax charge for the year
4,340,306
3,446,163


FACTORS THAT MAY AFFECT FUTURE TAX CHARGES

The Corporation Tax rate will increase to 25% for larger companies from 1 April 2023.
The Company has £5,745,454 (2021: £7,931,200) of tax losses carried forward available to offset against future profits in the relevant jurisdiction.

Page 35

 
FALCON INDUSTRIAL SERVICES LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

15.


EXCEPTIONAL ITEMS

2022
2021


Interest on tax charges
709,566
-

Dispute settlement
340,035
-

1,049,601
-


16.


INTANGIBLE ASSETS

Group





Patents and other intangible assets
Computer software
Goodwill
Total




Cost


At 1 January 2022
4,289,224
89,655
4,509,713
8,888,592


Additions
295,712
281,358
-
577,070


Disposals
(50,000)
-
-
(50,000)



At 31 December 2022

4,534,936
371,013
4,509,713
9,415,662



Amortisation


At 1 January 2022
2,913,764
69,590
40,053
3,023,407


Charge for the year on owned assets
154,847
9,676
445,502
610,025



At 31 December 2022

3,068,611
79,266
485,555
3,633,432



Net book value



At 31 December 2022
1,466,325
291,747
4,024,158
5,782,230



At 31 December 2021
1,375,460
20,065
4,469,660
5,865,185



Page 36

 
FALCON INDUSTRIAL SERVICES LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

17.


TANGIBLE FIXED ASSETS

Group






Freehold property
Plant and machinery
Fixtures and fittings
Office equipment
Total




Cost


At 1 January 2022
13,074,913
4,899,031
440,541
425,183
18,839,668


Additions
174,379
294,532
-
104,231
573,142


Disposals
(145,344)
(158,764)
-
-
(304,108)


Transfer to investment property
(8,760,884)
-
-
-
(8,760,884)



At 31 December 2022

4,343,064
5,034,799
440,541
529,414
10,347,818



Depreciation


At 1 January 2022
1,082,280
2,895,826
208,120
220,671
4,406,897


Charge for the year on owned assets
148,980
767,610
44,626
43,653
1,004,869


Disposals
(145,344)
(117,889)
-
-
(263,233)



At 31 December 2022

1,085,916
3,545,547
252,746
264,324
5,148,533



Net book value



At 31 December 2022
3,257,148
1,489,252
187,795
265,090
5,199,285



At 31 December 2021
11,992,633
2,003,205
232,421
204,512
14,432,771

Page 37

 
FALCON INDUSTRIAL SERVICES LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

           17.TANGIBLE FIXED ASSETS (CONTINUED)


Company






Office equipment


Cost


At 1 January 2022
54,910



At 31 December 2022

54,910



Depreciation


At 1 January 2022
54,910



At 31 December 2022

54,910



Net book value



At 31 December 2022
-



At 31 December 2021
-






Page 38

 
FALCON INDUSTRIAL SERVICES LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

18.


FIXED ASSET INVESTMENTS

Group





Investments in associates
Listed investments
Loans to associates
Unlisted and other fixed asset investments
Total




Cost or valuation


At 1 January 2022
1,026,281
2,678,201
1,487,261
10,555,208
15,746,951


Additions
-
-
-
295,350
295,350


Disposals/repayments of loans
-
-
-
(781,522)
(781,522)


Foreign exchange movement
-
-
-
23,861
23,861


Revaluations
-
(1,403,056)
-
-
(1,403,056)



At 31 December 2022

1,026,281
1,275,145
1,487,261
10,092,897
13,881,584



Impairment


Charge for the period
-
-
-
1,202,986
1,202,986



At 31 December 2022

-
-
-
1,202,986
1,202,986



Net book value



At 31 December 2022
1,026,281
1,275,145
1,487,261
8,889,911
12,678,598



At 31 December 2021
1,026,281
2,678,201
1,487,261
10,555,208
15,746,951

Page 39

 
FALCON INDUSTRIAL SERVICES LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
Company





Investments in subsidiary companies
Investments in associates
Listed investments
Loans to subsidiaries
Unlisted and other fixed asset investments
Total




Cost or valuation


At 1 January 2022
2,483,673
301,809
2,678,201
19,885,783
10,020,405
35,369,871


Additions
-
-
-
76,185,278
295,350
76,480,628


Disposals/repayments of loans
(726,954)
-
-
(4,102,186)
(550,021)
(5,379,161)


Foreign exchange movement
-
-
-
(56,459)
23,861
(32,598)


Revaluations
-
-
(1,403,056)
-
-
(1,403,056)



At 31 December 2022

1,756,719
301,809
1,275,145
91,912,416
9,789,595
105,035,684



Impairment


Charge for the period
612,528
-
-
-
1,202,986
1,815,514



At 31 December 2022

612,528
-
-
-
1,202,986
1,815,514



Net book value



At 31 December 2022
1,144,191
301,809
1,275,145
91,912,416
8,586,609
103,220,170



At 31 December 2021
2,483,673
301,809
2,678,201
19,885,783
10,020,405
35,369,871

Page 40

 
FALCON INDUSTRIAL SERVICES LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

SUBSIDIARY UNDERTAKINGS


The following were subsidiary undertakings of the Company:

Name

Registered office

Principal activity

Class of shares

Holding

Consulcesi SA*
Switzerland
Medical legal protection and services provider to HPs
Ordinary
60%
Falcon Productions Limited*
UK
Film Production and CME course production
Ordinary
100%
Sanita in Formazione S.P.A ^^^
Italy
CME provider
Ordinary
60%
Elystan SA*
Switzerland
Real estate investments
Ordinary
100%
Consulcesi Service SHPK***
Albania
Call centre
Ordinary
60%
Consulcesi Tech SA^^^
Switzerland
Analysis, design, development and installation of IT systems
Ordinary
60%
Consulcesi Sanita'Nel Diritto SRL*
Italy
Call centre management
Ordinary
100%
Docta SRL*
Italy
Marketing and PR
Ordinary
60%
Sanitassicura SRL^^^
Italy
Assurance services
Ordinary
60%
Consulcesi Corporate SA*
Switzerland
Supply of financial, administrative, technical and promotional services
Ordinary
60%
Consulcesi Service SRL^^^
Italy
Supply of financial, administrative, technical and promotional services
Ordinary
60%
Yes Learning SRL^^^
Italy
Provision of professional training courses
Ordinary
60%
Falcon Bienes Raices SL**
Spain
Real estate investments in Spain
Ordinary
100%
Roma 25 SA "
Switzerland
Real estate
Ordinary
50%
Kirken Investments SA*
Luxembourg
Financial interests
Ordinary
99.97%
ALT SRL"""
Italy
Real estate
Ordinary
99.97%
Sanita in-Formazione Edukim i Vazhduar Sh.p.k""
Albania
CME provider in Albania
Ordinary
60%
Consulcesi Tech SHPK****
Albania
ITC services
Ordinary
60%
Multichannel Media Production SRL^^^
Italy
Vidoe and communication services
Ordinary
60%
Consulcesi & Partners Srl^^^
Italy
Support for legal advice to doctors and healthcare professionals
Ordinary
60%
Health Security Management Srl^^^
Italy
Consulting services in healthcare and life science
Ordinary
60%
PKE Srl^^^
Italy
Data management and communication service provider for Italian healthcare professional
Ordinary
60%
Page 41

 
FALCON INDUSTRIAL SERVICES LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
SUBSIDIARY UNDERTAKINGS (CONTINUED)


Name

Registered office

Principal activity

Class of shares

Holding

Sics-Soc.It.Di Comunicazione Scientifica E Sanitaria Srl^
Italy
Health media company
Ordinary
51%


ASSOCIATES


The following were associates of the Company:


Name

Registered office

Principal activity

Class of shares

Holding

Farnese Immobiliare SR""""
Italy
property development
Ordinary
35%
Ledger Assest Holdings Limited*
England and Wales
software development
Ordinary
21%
QS Edizioni SRL^^
Italy
Health and medicine digital publishing house
Ordinary
30%

The share of the associates results have not been included within the consolidated figures on the basis of materiality.
Key: 
* = Subsidiaries and associates controlled/held directly by Falcon Industrial Services Limited.
** = Elystan SA has 100% shareholding in the company.
*** = Consulcesi SA has 100% shareholding in the companies.
**** = Consulcesi Tech SA has 100% shareholding in the company.
^ = PKE SRL has 85% shareholding in the company.
^^ = SICS SRL has 50% shareholding in the company.
^^^ = Consulcesi Corporate SA has 100% shareholding in the company .
" = Elystan SA has 50% shareholding in the company.
"" = Sanita in Formazione S.P.A has 100% shareholding in the company.
""" = Elystan SA has 10% shareholding and Kirken Investments SA has 90% shareholding in the company. 
"""" = ALT SRL has 35% shareholding in the company.

Page 42

 
FALCON INDUSTRIAL SERVICES LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

19.


INVESTMENT PROPERTY

Group


Freehold investment property




Valuation


At 1 January 2022
6,012,761


Transfer from tangible fixed assets
8,760,884



At 31 December 2022
14,773,645

The directors considered that the 2022 valuation on an open market value for existing use basis were not significantly different from the acquisition costs of the property.





20.


STOCKS

Group
Group
Company
Company
2022
2021
2022
2021

Stock of properties
10,987,444
10,987,444
10,987,444
10,987,444

10,987,444
10,987,444
10,987,444
10,987,444


Page 43

 
FALCON INDUSTRIAL SERVICES LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

21.


DEBTORS



Group
Group
Company
Company
2022
2021
2022
2021


Trade debtors
5,104,819
6,768,802
228,035
108,043

Other debtors
15,393,230
9,312,977
614,636
3,526,437

Prepayments and accrued income
1,174,323
1,062,199
19,018
71,580

Tax recoverable
40,463
1,489,235
-
-

21,712,835
18,633,213
861,689
3,706,060



22.


CURRENT ASSET INVESTMENTS

Group
Group
Company
Company
2022
2021
2022
2021

Listed investments
2,929,343
8,689,131
2,929,343
2,493,936

2,929,343
8,689,131
2,929,343
2,493,936



23.


CASH AND CASH EQUIVALENTS

Group
Group
Company
Company
2022
2021
2022
2021

Cash at bank and in hand
45,938,732
16,981,250
33,616,248
3,402,060

Less: bank overdrafts
(19)
(20)
(19)
(20)

45,938,713
16,981,230
33,616,229
3,402,040


Page 44

 
FALCON INDUSTRIAL SERVICES LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

24.


CREDITORS: Amounts falling due within one year

Group
Group
Company
Company
2022
2021
2022
2021

Bank overdrafts
19
20
19
20

Bank loans
4,369,214
3,355,233
2,672,316
2,882,196

Trade creditors
2,630,500
4,499,981
79,725
213,133

Amounts owed to group undertakings
-
-
453,702
3,475,789

Corporation tax
10,217,525
7,562,609
-
-

Other taxation and social security
120,775
23,100
120,775
23,100

Other creditors
4,888,449
5,609,356
36,158
38,644

Accruals and deferred income
1,203,923
1,700,101
50,849
53,596

23,430,405
22,750,400
3,413,544
6,686,478


For details of security provided on bank loans, please refer to Note 26.


25.


CREDITORS: Amounts falling due after more than one year

Group
Group
Company
Company
2022
2021
2022
2021

Bank loans
4,233,660
5,773,096
-
-

Other creditors
223,122
256,155
76,095
80,206

4,456,782
6,029,251
76,095
80,206


For details of security provided on bank loans, please refer to Note 26.

Page 45

 
FALCON INDUSTRIAL SERVICES LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

26.


LOANS


Group
Group
Company
Company
2022
2021
2022
2021

Amounts falling due within one year

Bank loans
4,369,214
3,355,233
2,672,316
2,882,196

Amounts falling due 1-2 years

Bank loans
291,614
473,037
-
-

Amounts falling due 2-5 years

Bank loans
874,840
1,419,110
-
-

Amounts falling due after more than 5 years

Bank loans
3,067,206
3,880,949
-
-

8,602,874
9,128,329
2,672,316
2,882,196


The bank loans were secured by assets held by the parent company and a subsidiary. In addition, the ultimate controlling party provided a personal guarantee up to €2.5m to a bank loan borrowed by a subsidary.
Amounts falling due after more than 5 years are made up of two loans held within subsidiaries, one being repayable monthly with the final repayment due in 2030, with a variable interest rate of EURIBOR + 1.25%. The other loan is repayable quartely with the final repayment due in 2036, with a variable interest rate of EURIBOR + 2.25%.


27.


FINANCIAL INSTRUMENTS

Group
Group
Company
Company
2022
2021
2022
2021

Financial assets

Other financial assets measured at fair value through profit or loss
16,553,128
11,367,332
4,204,488
5,172,137




Other financial assets measured at fair value through profit or loss comprises an investment portfolio of listed investments.

Page 46

 
FALCON INDUSTRIAL SERVICES LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

28.


SHARE CAPITAL

2022
2021
Authorised, allotted, called up and fully paid



1,573,530 (2021 - 1,573,530) Ordinary shares of £1.00 each
1,888,236
1,888,236



29.


RESERVES

Foreign exchange reserve

The foreign exchange reserve comprises foreign exchange movements on the retranslation of the Company and overseas subsidiaries whose functional currency is not Euros.

Other reserves

The consolidated reserves comprise legal reserves in some of the subsidiaries. The company other reserve represents the profit on a group reorganisation which the directors do not consider to be a realised profit. 

Profit and loss account

Includes all current and prior period retained profits and losses.


30.


CONTINGENT LIABILITIES

The company has issued a guarantee to its subsidiary Falcon Productions Limited for all of the subsidiary's outstanding liabilities existing at the balance sheet date 31st December 2022. The guarantee is issued in accordance with the exemption from the requirements of Companies Act 2006 relating to the audit of individual accounts by virtue of S479A of Companies Act 2006. The liabilities of Falcon Production Limited at the year end were £7,699 (2021: £1,389,892). These have been included in the Group's consolidated figures.

Page 47

 
FALCON INDUSTRIAL SERVICES LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

31.


RELATED PARTY TRANSACTIONS

The company has taken advantage of the exemption in FRS 102, paragraph 33.1A 'Related party disclosures' whereby it has not disclosed transactions with any wholly owned subsidiary undertakings.
During the year, the rental income received from the shareholder, Massimo Tortorella, amounted to €48,000 (2021: €48,000), which is consdiered by the directors as below the normal commercial basis. 
At the balance sheet date the group had the following amounts owed from entities under common control:


2022
2021

Falcon RE Limited
-
46,921
Falcon Properties and Developments Limited
-
14,887
Consulcesi Middle East DMCC
-
2,750,000

During the year, the group paid a company under common control a fees of CHF 50,000 (2021: CHF 110,000) for its services. There was no outstanding balance owed by the Group at the year end. 


32.


CONTROLLING PARTY

The ultimate controlling party is Massimo Tortorella by virtue of his shareholding.


 
Page 48