Company registration number 11064098 (England and Wales)
STELLING PROPERTIES (HOLDINGS) LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
STELLING PROPERTIES (HOLDINGS) LIMITED
COMPANY INFORMATION
Directors
Ms V M Alvarez-Landaluce
Mr J I Alvarez-Landaluce
Company number
11064098
Registered office
Coxford Farm Depot
Overton Road
Micheldever Station
Winchester
Hants
SO21 3AN
Auditor
Fiander Tovell Limited
Stag Gates House
63/64 The Avenue
Southampton
Hampshire
SO17 1XS
STELLING PROPERTIES (HOLDINGS) LIMITED
CONTENTS
Page
Strategic report
1 - 3
Directors' report
4 - 5
Independent auditor's report
6 - 8
Group statement of comprehensive income
9
Group balance sheet
10
Company balance sheet
11
Group statement of changes in equity
12
Company statement of changes in equity
13
Group statement of cash flows
14
Notes to the financial statements
15 - 31
STELLING PROPERTIES (HOLDINGS) LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022
- 1 -

The directors present the strategic report for the year ended 31 December 2022.

Background

 

Stelling Properties (Holdings) Ltd is a group of companies which provides high quality modular properties in the UK and Ireland.

 

Stelling achieves this through the identification and purchase of land in key locations, building the property and then providing, in the instance of its purpose built student accommodation (PBSA) a class leading experience to its resident student population through its management business – Unilife Ltd.

 

Construction of these PBSA assets is through Stelling’s project delivery business, WTC Developments Ltd. WTC Developments embraces the modern modular form of construction which allows it to construct Stelling PBSA assets in time scales that would not be achievable using traditional construction methods.

 

WTC Developments itself, contracts with Stelling’s own manufacturing business, Stelling Modular Ltd. Stelling Modular operates a factory, located near Winchester, which produces high quality modules.

 

The group aims to sell properties individually or, in the case of PBSA assets, individually or as portfolios once they are income generating. One of the short-term objectives of the group is to be the leading developer of residential and PBSA properties and the leading supplier of PBSA accommodation modules to 3rd party operators in the UK.

 

Progress in 2022

 

During 2022 Stelling has been working on three PBSA units, totalling 289 student beds.

 

Highlights for the year include;

 

 

 

 

 

 

 

Financial results

 

Profit and Loss

During the year the business sold the Winchester asset, described above, at a small consolidated loss (£247k). This loss was as a result of unforeseen remedial actions needed to the asset.

 

Its external sales in the period of £2.6m, were driven through rental receipts from students/tenants of £1.9m and sales of modules to third parties of £600k.

 

The overheads of the group increased to ~£4.9m from ~£2.8m the previous year representing investment in the group’s abilities in both its management and its technical staff.

 

This increase in administrative cost was offset by an increase in management fee earnt from non-group companies (up to £735k from £290k the previous year).

STELLING PROPERTIES (HOLDINGS) LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 2 -

Balance Sheet

 

The group has 2 investment properties covering 199 student beds with carrying values at cost of £33.5m, one was occupied by students in Jan 23 and the other, in Southampton, was fully occupied in Mar 23. These 2 assets combined are expected to release profits in excess of £12m to the consolidated profit and loss when sold. There is a third site being carried at £4m which is being held for development.

 

As set out in note 2, these investment properties are held at cost until construction is completed and so as both were completed in 2023, we expect them to be revalued to fair value in the 2023 accounts.

 

Against these assets the group has £17.7m of long-term loan funding.

 

The balance sheet was overdrawn as at 31 Dec 22 by (£6.8m) an increase from the 31 Dec 21 position (£3.6m) of £3.2m.

 

The overdrawn balance is mitigated by the un-realised profit which is held with the group in the form of the two PBSA assets, currently held at cost. These PBSA assets are now complete and fully occupied by students.

 

Once these assets are valued at fair value or are sold, the overdrawn balance sheet position will be reversed. The forecast for the two assets is that they will contribute circa £10.1m to the balance sheet.

 

Future activities

 

The group continues to invest in its capabilities and secure its pipeline of future projects.

 

 

 

 

 

Future activities – Risks

 

Staff – The group continues to attract and recruit highly skilled staff. It must continue to invest in its people both in terms of retention and training.

 

Sector – The group operates largely in the student accommodation space. The PBSA market has proven, and continues prove, that it is counter cyclical. That is at times of economical downturn more people go and seek training at University, that is it is largely viewed as immune to the economic outlook at any given time

 

Funding – The group makes use of shareholder funding and bank funding.

 

The shareholders of the business see the group in terms of a long term project, one that covers multiple decades rather than a few years, their commitment to the project is generational and they have the financial resources support it.

 

The group has developed good relationships with a number of financial institutions and these relationships continue to be strong. It has never failed to achieve bank funding on a project.

STELLING PROPERTIES (HOLDINGS) LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 3 -

Going Concern

 

Given the balance sheet position, the directors acknowledge the importance of the going concern assumption to these accounts and have therefore chosen to also include the going concern statement from accounting policies (see note 1) as part of the strategic report. This is to bring the thought process taken to the attention of the readers of the accounts as early as possible, and to emphasise the importance of this process:

 

The Group's business activities, together with the factors likely to affect its future development, performance and position are set out in the Strategic Report.

 

At the time of approving the financial statements the directors have a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future.

 

The Directors have produced detailed going concern forecasts for the Group based on expected activity. These models include the sales of the two student properties, now largely complete, in 2024. The expectation is that the sales values for the properties (or their SPV's) will be considerably in excess of the carrying value in these accounts.

 

This expectation alongside continued support from the groups parent entity in Jersey and the owners will enable the group to continue to meet its liabilities as they fall due. Furthermore, since the year end, the group has been backed with sufficient resources to enable the purchase of two further sites for the development of more student housing buildings.

 

Despite the group being in a net liabilities position as at 31 December 2022 of £6,839,657, the Directors have a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future.

 

Thus, they continue to adopt the going concern basis of accounting in preparing the financial statements.

On behalf of the board

Mr J I Alvarez-Landaluce
Director
25 November 2023
STELLING PROPERTIES (HOLDINGS) LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022
- 4 -

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

Principal activities

The principal activity of the group continued to be that of student rental accommodation.

Results and dividends

The results for the year are set out on page 9.

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

Directors

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

Ms V M Alvarez-Landaluce
Mr J I Alvarez-Landaluce
Financial instruments
Treasury operations and Financial instruments

The group's principal financial instruments comprise cash, trade debtors and trade creditors.

Liquidity risk

The group has strong financial controls in place to monitor and manage liquidity.

Interest rate risk

The directors considers that the Group faces the usual pricing risk of any other company operating in a competitive, commercial environment.

Credit risk

Customers who wish to trade on credit terms are subject to credit verification procedures. Trade debtors are monitored on an ongoing basis and provision made for doubtful debts where necessary.

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). 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 group and company, and of the profit or loss of the group 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 group’s and company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the group and company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

STELLING PROPERTIES (HOLDINGS) LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 5 -
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 auditor of the company 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 auditor of the company is aware of that information.

Disclosure in strategic report

The group has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the group's strategic report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the directors' report. It has done so in respect of future developments.

On behalf of the board
Mr J I Alvarez-Landaluce
Director
25 November 2023
STELLING PROPERTIES (HOLDINGS) LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF STELLING PROPERTIES (HOLDINGS) LIMITED
- 6 -
Opinion

We have audited the financial statements of Stelling Properties (Holdings) Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2022 which comprise the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the group and parent company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’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 and 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.

Other information

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

 

We have nothing to report in this regard.

The year ended 31 December 2022 is the first year for which an audit has been required for the group. As a result, the comparative figures have not been audited.

STELLING PROPERTIES (HOLDINGS) LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF STELLING PROPERTIES (HOLDINGS) LIMITED
- 7 -

Opinions on other matters prescribed by the Companies Act 2006

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

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 their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.

 

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the 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 parent company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

Extent to which the audit was considered capable of detecting irregularities, including fraud

Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:

STELLING PROPERTIES (HOLDINGS) LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF STELLING PROPERTIES (HOLDINGS) LIMITED
- 8 -

We assessed the susceptibility of the company’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:

Audit response to risks identified

To address the risk of fraud through management bias and override of controls, we:

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:

There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.

Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

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 2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.

Adam Buse ACA (Senior Statutory Auditor)
For and on behalf of Fiander Tovell Limited
27 November 2023
Chartered Accountants
Statutory Auditor
Stag Gates House
63/64 The Avenue
Southampton
Hampshire
SO17 1XS
STELLING PROPERTIES (HOLDINGS) LIMITED
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2022
- 9 -
2022
2021
Notes
£
£
Turnover
3
2,621,158
1,545,530
Cost of sales
(1,055,495)
(531,453)
Gross profit
1,565,663
1,014,077
Administrative expenses
(4,893,670)
(2,825,718)
Other operating income
735,000
290,000
Operating loss
4
(2,593,007)
(1,521,641)
Interest payable and similar expenses
7
(391,823)
(260,448)
Amounts written off investments
8
(247,986)
20,004,393
(Loss)/profit before taxation
(3,232,816)
18,222,304
Tax on (loss)/profit
9
16,852
(257,714)
(Loss)/profit for the financial year
(3,215,964)
17,964,590
(Loss)/profit for the financial year is all attributable to the owners of the parent company.
Total comprehensive income for the year is all attributable to the owners of the parent company.
STELLING PROPERTIES (HOLDINGS) LIMITED
GROUP BALANCE SHEET
AS AT
31 DECEMBER 2022
31 December 2022
- 10 -
2022
2021
Notes
£
£
£
£
Fixed assets
Tangible assets
10
843,111
876,187
Investment property
11
37,924,941
36,693,453
38,768,052
37,569,640
Current assets
Stocks
14
651,528
2,636,382
Debtors
15
22,023,754
21,534,256
Cash at bank and in hand
737,881
606,653
23,413,163
24,777,291
Creditors: amounts falling due within one year
16
(51,259,301)
(58,826,646)
Net current liabilities
(27,846,138)
(34,049,355)
Total assets less current liabilities
10,921,914
3,520,285
Creditors: amounts falling due after more than one year
17
(17,761,571)
(6,903,116)
Provisions for liabilities
Deferred tax liability
19
-
0
240,862
-
(240,862)
Net liabilities
(6,839,657)
(3,623,693)
Capital and reserves
Called up share capital
22
100
100
Profit and loss reserves
(6,839,757)
(3,623,793)
Total equity
(6,839,657)
(3,623,693)

These financial statements have been prepared in accordance with the provisions relating to medium-sized groups.

The financial statements were approved by the board of directors and authorised for issue on 25 November 2023 and are signed on its behalf by:
25 November 2023
Mr J I Alvarez-Landaluce
Director
Company registration number 11064098 (England and Wales)
STELLING PROPERTIES (HOLDINGS) LIMITED
COMPANY BALANCE SHEET
AS AT 31 DECEMBER 2022
31 December 2022
- 11 -
2022
2021
Notes
£
£
£
£
Fixed assets
Investments
12
801
1,000
Current assets
Debtors
15
51,535,676
49,349,170
Creditors: amounts falling due within one year
16
(50,870,170)
(48,727,832)
Net current assets
665,506
621,338
Total assets less current liabilities
666,307
622,338
Creditors: amounts falling due after more than one year
17
-
(4,724)
Net assets
666,307
617,614
Capital and reserves
Called up share capital
22
100
100
Profit and loss reserves
666,207
617,514
Total equity
666,307
617,614

As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £48,693 (2021 - £26,604 profit).

These financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime.

The financial statements were approved by the board of directors and authorised for issue on 25 November 2023 and are signed on its behalf by:
25 November 2023
Mr J I Alvarez-Landaluce
Director
Company registration number 11064098 (England and Wales)
STELLING PROPERTIES (HOLDINGS) LIMITED
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2022
- 12 -
Share capital
Profit and loss reserves
Total
£
£
£
Balance at 1 January 2021
100
(21,588,383)
(21,588,283)
Year ended 31 December 2021:
Profit and total comprehensive income
-
17,964,590
17,964,590
Balance at 31 December 2021
100
(3,623,793)
(3,623,693)
Year ended 31 December 2022:
Loss and total comprehensive income
-
(3,215,964)
(3,215,964)
Balance at 31 December 2022
100
(6,839,757)
(6,839,657)
STELLING PROPERTIES (HOLDINGS) LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2022
- 13 -
Share capital
Profit and loss reserves
Total
£
£
£
Balance at 1 January 2021
100
590,910
591,010
Year ended 31 December 2021:
Profit and total comprehensive income for the year
-
26,604
26,604
Balance at 31 December 2021
100
617,514
617,614
Year ended 31 December 2022:
Profit and total comprehensive income
-
48,693
48,693
Balance at 31 December 2022
100
666,207
666,307
STELLING PROPERTIES (HOLDINGS) LIMITED
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2022
- 14 -
2022
2021
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
27
9,208,636
14,368,435
Interest paid
(391,823)
(260,448)
Income taxes refunded
-
138,291
Net cash inflow from operating activities
8,816,813
14,246,278
Investing activities
Proceeds from disposal of business
(53,675)
(57,923)
Purchase of tangible fixed assets
(275,416)
(166,540)
Proceeds from disposal of tangible fixed assets
2,298
-
Purchase of investment property
(19,237,232)
(5,425,389)
Net cash used in investing activities
(19,564,025)
(5,649,852)
Financing activities
Proceeds from borrowings
10,878,440
6,903,116
Reduction of long term borrowings
-
(15,260,240)
Net cash generated from/(used in) financing activities
10,878,440
(8,357,124)
Net increase in cash and cash equivalents
131,228
239,302
Cash and cash equivalents at beginning of year
606,653
367,351
Cash and cash equivalents at end of year
737,881
606,653
STELLING PROPERTIES (HOLDINGS) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
- 15 -
1
Accounting policies
Company information

Stelling Properties (Holdings) Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is Coxford Farm Depot, Overton Road, Micheldever Station, Winchester, Hants, SO21 3AN.

 

The group consists of Stelling Properties (Holdings) Limited and all of its subsidiaries.

1.1
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, modified to include the revaluation of freehold properties and to include investment properties and certain financial instruments at fair value. The principal accounting policies adopted are set out below.

The company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements for parent company information presented within the consolidated financial statements:

 

1.2
Business combinations

In the parent company financial statements, the cost of a business combination is the fair value at the acquisition date of the assets given, equity instruments issued and liabilities incurred or assumed, plus costs directly attributable to the business combination. The excess of the cost of a business combination over the fair value of the identifiable assets, liabilities and contingent liabilities acquired is recognised as goodwill. The cost of the combination includes the estimated amount of contingent consideration that is probable and can be measured reliably, and is adjusted for changes in contingent consideration after the acquisition date. Provisional fair values recognised for business combinations in previous periods are adjusted retrospectively for final fair values determined in the 12 months following the acquisition date. Investments in subsidiaries, joint ventures and associates are accounted for at cost less impairment.

 

Deferred tax is recognised on differences between the value of assets (other than goodwill) and liabilities recognised in a business combination accounted for using the purchase method and the amounts that can be deducted or assessed for tax, considering the manner in which the carrying amount of the asset or liability is expected to be recovered or settled. The deferred tax recognised is adjusted against goodwill or negative goodwill.

STELLING PROPERTIES (HOLDINGS) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 16 -
1.3
Basis of consolidation

The consolidated group financial statements consist of the financial statements of the parent company Stelling Properties (Holdings) Limited together with all entities controlled by the parent company (its subsidiaries) and the group’s share of its interests in joint ventures and associates.

 

All financial statements are made up to 31 December 2022. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.

 

All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.

Subsidiaries are consolidated in the group’s financial statements from the date that control commences until the date that control ceases.

Entities in which the group holds an interest and which are jointly controlled by the group and one or more other venturers under a contractual arrangement are treated as joint ventures. Entities other than subsidiary undertakings or joint ventures, in which the group has a participating interest and over whose operating and financial policies the group exercises a significant influence, are treated as associates.

Investments in joint ventures and associates are carried in the group balance sheet at cost plus post-acquisition changes in the group’s share of the net assets of the entity, less any impairment in value. The carrying values of investments in joint ventures and associates include acquired goodwill.

 

If the group’s share of losses in a joint venture or associate equals or exceeds its investment in the joint venture or associate, the group does not recognise further losses unless it has incurred obligations to do so or has made payments on behalf of the joint venture or associate.

 

Unrealised gains arising from transactions with joint ventures and associates are eliminated to the extent of the group’s interest in the entity.

1.4
Going concern

The Group's business activities, together with the factors likely to affect its future development, performance and position are set out in the Strategic Report.

 

At the time of approving the financial statements the directors have a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future.

 

The Directors have produced detailed going concern forecasts for the Group based on expected activity. These models include the sales of the two student properties, now largely complete, in 2024. The expectation is that the sales values for the properties (or their SPV's) will be considerably in excess of the carrying value in these accounts.

 

This expectation alongside continued support from the groups parent entity in Jersey and the owners will enable the group to continue to meet its liabilities as they fall due. Furthermore, since the year end, the group has been backed with sufficient resources to enable the purchase of two further sites for the development of more student housing buildings.

 

Despite the group being in a net liabilities position as at 31 December 2022 of £6,839,657, the Directors have a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future.

 

Thus, they continue to adopt the going concern basis of accounting in preparing the financial statements.

 

STELLING PROPERTIES (HOLDINGS) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 17 -
1.5
Turnover

Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates. The group recognises turnover on an accruals basis, where the amount of turnover can be reliably measured and it is probable that the future economic benefits will flow to the group.

 

Rental income and rental management income is recognised in the period to which it relates.

Revenue from contracts for the provision of professional services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that it is probable will be recovered.

1.6
Tangible fixed assets

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Leasehold land and buildings
Equal instalments over the remaining period of the lease
Plant and equipment
25% straight line
Fixtures and fittings
25% straight line
Motor vehicles
25% reducing balance

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in the profit and loss account.

1.7
Investment property

Investment property, which is property held to earn rentals and/or for capital appreciation, is initially recognised at cost, which includes the purchase cost and any directly attributable expenditure. Subsequently it is measured at fair value at the reporting end date. Changes in fair value are recognised in profit or loss.

 

1.8
Fixed asset investments

Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available.

 

In the parent company financial statements, investments in subsidiaries are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.

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

1.9
Borrowing costs related to fixed assets

Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily take a substantial period of time to get ready for their intended use or sale, are added to the cost of those assets, until such time as the assets are substantially ready for their intended use or sale.

STELLING PROPERTIES (HOLDINGS) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 18 -

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

1.10
Impairment of fixed assets

At each reporting period end date, the group reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

 

The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

 

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

1.11
Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.

 

Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

STELLING PROPERTIES (HOLDINGS) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 19 -
1.12
Construction contracts

Where the outcome of a construction contract can be estimated reliably, revenue and costs are recognised by reference to the stage of completion of the contract activity at the reporting end date. Variations in contract work, claims and incentive payments are included to the extent that the amount can be measured reliably and its receipt is considered probable.

 

When it is probable that total contract costs will exceed total contract turnover, the expected loss is recognised as an expense immediately.

 

Where the outcome of a construction contract cannot be estimated reliably, contract revenue is recognised to the extent of contract costs incurred where it is probable that they will be recoverable. Contract costs are recognised as expenses in the period in which they are incurred. When costs incurred in securing a contract are recognised as an expense in the period in which they are incurred, they are not included in contract costs if the contract is obtained in a subsequent period.

The “percentage of completion method” is used to determine the appropriate amount to recognise in a given period. The stage of completion is measured by the proportion of contract costs incurred for work performed to date compared to the estimated total contract costs. Costs incurred in the year in connection with future activity on a contract are excluded from contract costs in determining the stage of completion. These costs are presented as stocks, prepayments or other assets depending on their nature, and provided it is probable they will be recovered.

The “percentage of completion method” is used to determine the appropriate amount to recognise in a given period. The stage of completion is measured by the proportion of contract costs incurred for work performed to date compared to the estimated total contract costs. Costs incurred in the year in connection with future activity on a contract are excluded from contract costs in determining the stage of completion. These costs are presented as stocks, prepayments or other assets depending on their nature, and provided it is probable they will be recovered.

1.13
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.

1.14
Financial instruments

The group 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.

 

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 and 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.

STELLING PROPERTIES (HOLDINGS) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 20 -
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 profit or loss.

 

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 profit or loss.

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 group 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 group after deducting all of its liabilities.

Basic financial liabilities

Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, 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.

 

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

 

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Derecognition of financial liabilities

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

1.15
Equity instruments

Equity instruments issued by the group 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 group.

1.16
Taxation

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

STELLING PROPERTIES (HOLDINGS) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 21 -
Current tax

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account 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 group’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 profit and loss account, 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 if, and only if, there is 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.

1.17
Employee benefits

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

 

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

 

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

1.18
Retirement benefits

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

1.19
Leases

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.

1.20
Foreign exchange

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.

STELLING PROPERTIES (HOLDINGS) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 22 -
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.

Critical judgements

The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.

Valuation of investment property

The group accounting policy is for student accommodation buildings to be allocated to investment properties even whilst they are being constructed. This is because the rooms are opened to students as they are completed.

 

However, whilst they are being constructed, the asset is carried at cost until all of the work required on the building has been completed. The building is then revalued in the first financial period it was completed in.

3
Turnover
2022
2021
£
£
Turnover analysed by class of business
Rental income
1,872,910
1,299,463
Module sales
616,186
61,573
Management fees
22,355
30,000
Other income
109,707
154,494
2,621,158
1,545,530
4
Operating loss
2022
2021
£
£
Operating loss for the year is stated after charging:
Exchange losses
2,077
-
Depreciation of owned tangible fixed assets
286,649
251,140
Loss on disposal of tangible fixed assets
19,545
-
Operating lease charges
410
5,258
STELLING PROPERTIES (HOLDINGS) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 23 -
5
Auditor's remuneration
2022
2021
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the group and company
4,000
-
Audit of the financial statements of the company's subsidiaries
21,225
-
25,225
-
6
Employees

The average monthly number of persons (including directors) employed by the group and company during the year was:

Group
Company
2022
2021
2022
2021
Number
Number
Number
Number
89
56
2
2

Their aggregate remuneration comprised:

Group
Company
2022
2021
2022
2021
£
£
£
£
Wages and salaries
3,573,158
1,663,234
-
0
-
0
Social security costs
418,365
245,228
-
-
Pension costs
150,390
91,176
-
0
-
0
4,141,913
1,999,638
-
0
-
0
7
Interest payable and similar expenses
2022
2021
£
£
Interest on bank overdrafts and loans
249,789
208,400
Interest payable to group undertakings
-
0
4,860
Other interest on financial liabilities
142,034
47,188
Total finance costs
391,823
260,448

Borrowing costs excluded from interest payable and included in the cost of assets during the year are as follows:

2022
2021
£
£
Investment property
1,031,976
-
STELLING PROPERTIES (HOLDINGS) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 24 -
8
Amounts written off investments
2022
2021
£
£
Other gains and losses
(247,986)
20,004,393
9
Taxation
2022
2021
£
£
Current tax
Adjustments in respect of prior periods
(16,852)
16,852
Deferred tax
Origination and reversal of timing differences
-
0
240,862
Total tax (credit)/charge
(16,852)
257,714

The actual (credit)/charge for the year can be reconciled to the expected (credit)/charge for the year based on the profit or loss and the standard rate of tax as follows:

2022
2021
£
£
(Loss)/profit before taxation
(3,232,816)
18,222,304
Expected tax (credit)/charge based on the standard rate of corporation tax in the UK of 19.00% (2021: 19.00%)
(614,235)
3,462,238
Tax effect of expenses that are not deductible in determining taxable profit
756,727
904,821
Tax effect of income not taxable in determining taxable profit
(80,124)
(3,880,959)
Tax effect of utilisation of tax losses not previously recognised
-
0
(199,213)
Unutilised tax losses carried forward
21,355
29,634
Change in unrecognised deferred tax assets
(9,214)
-
0
Effect of change in corporation tax rate
37,175
240,862
Group relief
(90,765)
(195,257)
Permanent capital allowances in excess of depreciation
(23,103)
(121,264)
Depreciation on assets not qualifying for tax allowances
2,184
-
Under/(over) provided in prior years
(16,852)
16,852
Taxation (credit)/charge
(16,852)
257,714
STELLING PROPERTIES (HOLDINGS) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 25 -
10
Tangible fixed assets
Group
Leasehold land and buildings
Plant and equipment
Fixtures and fittings
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 January 2022
736,739
422,284
343,972
15,860
1,518,855
Additions
7,376
235,465
32,575
-
0
275,416
Disposals
(18,072)
(99,473)
(65,055)
-
0
(182,600)
At 31 December 2022
726,043
558,276
311,492
15,860
1,611,671
Depreciation and impairment
At 1 January 2022
172,829
252,352
204,601
12,886
642,668
Depreciation charged in the year
78,213
112,001
93,461
2,974
286,649
Eliminated in respect of disposals
(6,578)
(97,133)
(57,046)
-
0
(160,757)
At 31 December 2022
244,464
267,220
241,016
15,860
768,560
Carrying amount
At 31 December 2022
481,579
291,056
70,476
-
0
843,111
At 31 December 2021
563,910
169,932
139,371
2,974
876,187
The company had no tangible fixed assets at 31 December 2022 or 31 December 2021.
11
Investment property
Group
Company
2022
2022
£
£
Fair value
At 1 January 2022
36,659,417
-
Additions through external acquisition
18,205,256
-
Disposals
(17,971,708)
-
Other changes
1,031,976
-
At 31 December 2022
37,924,941
-

The investment property is held at cost as it is still being constructed.

 

The cost of the investment property includes £405,522 (2021 - £33,115) of capitalised interest costs and £626,454 (2021 - £108,300) of capitalised loan arrangement fees.

STELLING PROPERTIES (HOLDINGS) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 26 -
12
Fixed asset investments
Group
Company
2022
2021
2022
2021
Notes
£
£
£
£
Investments in subsidiaries
13
-
0
-
0
801
1,000
Movements in fixed asset investments
Company
Shares in subsidiaries
£
Cost or valuation
At 1 January 2022
1,000
Disposals
(199)
At 31 December 2022
801
Carrying amount
At 31 December 2022
801
At 31 December 2021
1,000
13
Subsidiaries

Details of the company's subsidiaries at 31 December 2022 are as follows:

Name of undertaking
Registered office
Class of
% Held
shares held
Direct
Stelling Properties Limited
Coxford Farm Depot Overton Road, Micheldever Station, Winchester, England, SO21 3AN
Ordinary
100.00
Stelling Modular Limited
As above
Ordinary
100.00
WTC Developments Limited
As above
Ordinary
100.00
Unilife Limited
As above
Ordinary
100.00
Big Sur (Bournemouth) Limited
As above
Ordinary
100.00
Big Sur (High Street) Limited
As above
Ordinary
100.00
Big Sur (Kerrfield) Limited
As above
Ordinary
100.00
Big Sur (Lawson Street) Limited
As above
Ordinary
100.00
Big Sur (Walnut Tree) Limited
As above
Ordinary
100.00

As noted elsewhere in the accounts, Big Sur (Sparkford) Limited was disposed of within the year.

STELLING PROPERTIES (HOLDINGS) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 27 -
14
Stocks
Group
Company
2022
2021
2022
2021
£
£
£
£
Raw materials and consumables
640,082
989,183
-
-
Work in progress
11,446
1,647,199
-
-
651,528
2,636,382
-
-
15
Debtors
Group
Company
2022
2021
2022
2021
Amounts falling due within one year:
£
£
£
£
Trade debtors
480,099
128,813
-
0
-
0
Corporation tax recoverable
28,949
3,867
-
0
-
0
Amounts owed by group undertakings
20,943,670
19,956,508
51,535,676
49,058,730
Other debtors
196,715
706,024
-
0
290,440
Prepayments and accrued income
374,321
739,044
-
0
-
0
22,023,754
21,534,256
51,535,676
49,349,170
16
Creditors: amounts falling due within one year
Group
Company
2022
2021
2022
2021
Notes
£
£
£
£
Bank loans
18
-
0
8,420,000
-
0
-
0
Trade creditors
1,022,880
928,175
-
0
-
0
Amounts owed to group undertakings
46,656,455
47,463,575
50,796,870
48,718,427
Corporation tax payable
33
-
0
-
0
-
0
Other taxation and social security
344,442
654,362
-
-
Deferred income
20
841,000
371,022
-
0
-
0
Other creditors
405,828
350,478
-
0
-
0
Accruals and deferred income
1,988,663
639,034
73,300
9,405
51,259,301
58,826,646
50,870,170
48,727,832
17
Creditors: amounts falling due after more than one year
Group
Company
2022
2021
2022
2021
Notes
£
£
£
£
Bank loans and overdrafts
18
17,761,571
6,832,586
-
0
-
0
Other borrowings
18
-
0
70,530
-
0
4,724
17,761,571
6,903,116
-
4,724
STELLING PROPERTIES (HOLDINGS) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 28 -
18
Loans and overdrafts
Group
Company
2022
2021
2022
2021
£
£
£
£
Bank loans
17,761,571
15,252,586
-
0
-
0
Other loans
-
0
70,530
-
0
4,724
17,761,571
15,323,116
-
4,724
Payable within one year
-
0
8,420,000
-
0
-
0
Payable after one year
17,761,571
6,903,116
-
0
4,724

The bank loans are secured by a fixed and floating charge over the investment properties.

19
Deferred taxation

The following are the major deferred tax liabilities and assets recognised by the group and company, and movements thereon:

Liabilities
Liabilities
2022
2021
Group
£
£
Accelerated capital allowances
-
240,862
The company has no deferred tax assets or liabilities.
Group
Company
2022
2022
Movements in the year:
£
£
Liability at 1 January 2022
240,862
-
Transfer on disposal
(240,862)
-
Asset at 31 December 2022
-
-
20
Deferred income
Group
Company
2022
2021
2022
2021
£
£
£
£
Other deferred income
841,000
371,022
-
-
STELLING PROPERTIES (HOLDINGS) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 29 -
21
Retirement benefit schemes
2022
2021
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
150,390
91,176

A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.

22
Share capital
Group and company
2022
2021
2022
2021
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary Shares of £1 each
100
100
100
100
23
Disposals

On 30 June 2022 the group disposed of its 100% holding in Big Sur (Sparkford) Limited. Included in these financial statements are profits of £519,827 arising from the company's interests in Big Sur (Sparkford) Limited up to the date of its disposal.

 

Net assets disposed of
£
Cash and cash equivalents
53,775
Investment property
17,971,708
Trade and other receivables
2,315
Trade and other payables
(9,124,705)
Borrowings
(8,414,145)
Deferred tax
(240,862)
248,086
Gain on disposal
(247,986)
Total consideration
100
The consideration was satisfied by:
£
Cash
100
100

The disposal of the subsidiary also included the purchaser repaying the bank debt (£8.4m) and the balances owed to the group (£8.8m) by the entity.

STELLING PROPERTIES (HOLDINGS) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 30 -
24
Operating lease commitments
Lessee

At the reporting end date the group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

Group
Company
2022
2021
2022
2021
£
£
£
£
Within one year
442,031
28,750
-
-
Between two and five years
1,768,125
848,125
-
-
In over five years
566,408
693,387
-
-
2,776,564
1,570,262
-
-
25
Financial commitments, guarantees and contingent liabilities

As at the 31st December 2022, the group were committed to expenses to complete the construction of the investment properties to the total of £2,493,465 (2021: £20,698,721).

26
Controlling party

From 25 August 2022, the ultimate parent company was Walnut Developments Limited, a company registered in Jersey. Before this, the ultimate parent company was Stelling Properties Jersey Ltd. Both these entities have registered offices at 4th floor, St Paul's Gate, 22 - 24 New Street, St Helier, Jersey.

 

Stelling Properties Holdings Limited is the largest and smallest group to which the accounts are consolidated into. Copies of the consolidated financial statements are publicly available from Companies House.

27
Cash generated from group operations
2022
2021
£
£
(Loss)/profit for the year after tax
(3,215,964)
17,964,589
Adjustments for:
Taxation (credited)/charged
(16,852)
257,714
Finance costs
391,823
260,448
Loss on disposal of tangible fixed assets
19,545
-
Depreciation and impairment of tangible fixed assets
286,648
251,140
Other gains and losses
247,986
(20,004,393)
Movements in working capital:
Decrease/(increase) in stocks
1,984,854
(3,823,204)
(Increase)/decrease in debtors
(466,731)
36,598,337
Increase/(decrease) in creditors
9,507,349
(17,507,218)
Increase in deferred income
469,978
371,022
Cash generated from operations
9,208,636
14,368,435
STELLING PROPERTIES (HOLDINGS) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 31 -
28
Analysis of changes in net debt - group
1 January 2022
Cash flows
31 December 2022
£
£
£
Cash at bank and in hand
606,653
131,228
737,881
Borrowings excluding overdrafts
(15,323,116)
(2,438,455)
(17,761,571)
(14,716,463)
(2,307,227)
(17,023,690)
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