Company Registration number:
Kingfisher Resorts Studland Limited
for the Year Ended 28 December 2022
Kingfisher Resorts Studland Limited
Contents
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Company Information |
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Strategic Report |
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Directors' Report |
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Statement of Directors' Responsibilities |
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Independent Auditor's Report |
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Consolidated Profit and Loss Account |
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Consolidated Statement of Comprehensive Income |
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Consolidated Balance Sheet |
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Balance Sheet |
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Consolidated Statement of Changes in Equity |
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Statement of Changes in Equity |
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Consolidated Statement of Cash Flows |
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Notes to the Financial Statements |
Kingfisher Resorts Studland Limited
Company Information
Directors |
A J B Nares R F Chamberlayne N P Chapman N J Street |
Company secretary |
Kin Company Secretarial Limited |
Registered office |
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Auditors |
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Kingfisher Resorts Studland Limited
Strategic Report for the Year Ended 28 December 2022
The directors present their strategic report for the year ended 28 December 2022.
Principal activity
The principal activity of the group is that of trading as a hotel via its wholly owned subsidiary.
Fair review of the business
The principal activity of the group is that of trading as a hotel via its wholly owned subsidiary.
The group operates the Knoll House Hotel, a unique property in Studland in Dorset and as previously reported continues to seek planning permission to redevelop its assets. The hotel remains very profitable with results in 2023 in line with those in 2022 and strong cash generation. The directors expect this level of profitability to be at least maintained in 2024.
The company has invested significant sums in the planning process to date (which are included within Assets in the course of construction) but on 24 January 2024, the latest planning application was turned down. However, the Directors are now preparing a revised application and believe there is strong political support for approval and remain positive about obtaining success, following a reduction in the scale of the development originally proposed.
The application has been fully supported by the Board and funders and will further strengthen the group’s balance sheet.
The Board considers that the group performed satisfactorily against the hotel market generally, having regard for its historic legacy balanced against the imperative to refurbish what is a geographically well positioned, but dated and inefficient product.
The main KPIs of the business for the 2022 trading period, as traditionally assessed by the hotel industry, are as follows: -
Occupancy – 70% (2021 - 74%)
ADR (Average daily rate) - £111 (2021 - £139)
RevPAR (Revenue per available room) - £78 (2021 - £103)
Kingfisher Resorts Studland Limited
Strategic Report for the Year Ended 28 December 2022
Principal risks and uncertainties
The Board considers the principal risks affecting the UK hotel market in general are both demand driven uncertainty caused by falling consumer confidence and disposable income, and inflationary and macro driven cost pressures, particularly affecting utility costs.
The impact of these cost increases cannot be recovered through tariff growth, resulting in a need to balance careful operating cost control with a need for value for money and sustainable trade.
The Board manages its exposure to price risk through careful yield management, assessing the demand levels and adjusting key tariffs accordingly. The Board does not consider it is exposed to credit risk.
The Board has ensured that sufficient funding is available to meet the group’s needs in the foreseeable future through a prudent combination of equity and bank debt; along with regular management and updates of forecasts, cash flow and liquidity risks are managed.
Approved by the Board on
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Kingfisher Resorts Studland Limited
Directors' Report for the Year Ended 28 December 2022
The directors present their report and the consolidated financial statements for the year ended 28 December 2022.
Directors of the group
The directors who held office during the year were as follows:
Financial instruments
Price risk, credit risk, liquidity risk and cash flow risk
The Board manages its exposure to price risk through careful yield management, assessing the demand levels and adjusting key tariffs accordingly. The Board does not consider it is exposed to credit risk.
The Board has ensured that sufficient funding is available to meet the group’s needs in the foreseeable future through a prudent combination of equity and bank debt; along with regular management and updates of forecasts, cash flow and liquidity risks are managed.
Disclosure of information to the auditor
Each director has taken steps that they ought to have taken as a director in order to make themselves aware of any relevant audit information and to establish that the company's auditor is aware of that information. The directors confirm that there is no relevant information that they know of and of which they know the auditor is unaware.
Future Developments
The future developments of the business are included within the strategic report.
Approved by the Board on
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Kingfisher Resorts Studland Limited
Statement of Directors' Responsibilities
The directors acknowledge their responsibilities 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 the company and of the profit or loss of the group for that period. In preparing these financial statements, the directors are required to:
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select suitable accounting policies and apply them consistently; |
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make judgements and accounting estimates that are reasonable and prudent; |
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state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and |
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prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business. |
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the group's and the company's transactions and disclose with reasonable accuracy at any time the financial position of the group and the 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 the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Kingfisher Resorts Studland Limited
Independent Auditor's Report to the Members of Kingfisher Resorts Studland Limited
Opinion
We have audited the financial statements of Kingfisher Resorts Studland Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 28 December 2022, which comprise the Consolidated Profit and Loss Account, Consolidated Statement of Comprehensive Income, Consolidated Balance Sheet, Balance Sheet, Consolidated Statement of Changes in Equity, Statement of Changes in Equity, Consolidated Statement of Cash Flows, and Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
• | give a true and fair view of the state of the group's and the parent company's affairs as at 28 December 2022 and of its loss for the year then ended; |
• | have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and |
• | have been prepared in accordance with the requirements of the Companies Act 2006. |
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the auditor 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 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
We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report to you where:
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the directors’ use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or |
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the directors have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the group’s or the parent company’s ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the financial statements are authorised for issue. |
Kingfisher Resorts Studland Limited
Independent Auditor's Report to the Members of Kingfisher Resorts Studland Limited
Other information
The directors are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, 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 audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. 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 matter prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
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the information given in the Strategic Report and Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
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the Strategic Report and Directors' Report have been prepared in accordance with applicable legal requirements. |
In the light of our 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 and the Directors' Report.
Matters on which we are required to report by exception
We have nothing to report in respect of the following matters where 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. |
Responsibilities of directors
As explained more fully in the Statement of Directors' Responsibilities set out on page 5, 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.
Kingfisher Resorts Studland Limited
Independent Auditor's Report to the Members of Kingfisher Resorts Studland Limited
Auditor 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.
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:
The 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:
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the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations; |
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we identified the laws and regulations applicable to the company through discussions with directors and other management, and from our commercial knowledge and experience of the hotel sector; |
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we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the company, including the Companies Act 2006, taxation legislation, data protection, anti-bribery, employment, environmental and health and safety legislation; |
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we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal correspondence; and |
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identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit. |
We assessed the susceptibility of the company’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:
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making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; and |
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considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations. |
To address the risk of fraud through management bias and override of controls, we:
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performed analytical procedures to identify any unusual or unexpected relationships; |
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tested journal entries to identify unusual transactions; |
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assessed whether judgements and assumptions made in determining the accounting estimates were indicative of potential bias; and |
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investigated the rationale behind significant or unusual transactions. |
Kingfisher Resorts Studland Limited
Independent Auditor's Report to the Members of Kingfisher Resorts Studland Limited
In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:
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agreeing financial statement disclosures to underlying supporting documentation; |
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reading the minutes of meetings of those charged with governance; and |
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enquiring of management as to actual and potential litigation and claims. |
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 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 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.
For and on behalf of
Goodwood House
Blackbrook Park Avenue
Somerset
TA1 2PX
Kingfisher Resorts Studland Limited
Consolidated Profit and Loss Account
for the Year Ended 28 December 2022
Note |
2022 |
2021 |
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Turnover |
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Cost of sales |
( |
( |
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Gross profit |
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Administrative expenses |
( |
( |
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Other operating income |
- |
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Operating profit |
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Interest payable and similar charges |
( |
( |
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(Loss)/profit before tax |
( |
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Taxation |
- |
( |
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(Loss)/profit for the financial year |
( |
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Profit/(loss) attributable to: |
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Owners of the company |
( |
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Kingfisher Resorts Studland Limited
Consolidated Statement of Comprehensive Income
for the Year Ended 28 December 2022
2022 |
2021 |
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(Loss)/profit for the year |
( |
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Total comprehensive income for the year |
( |
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Total comprehensive income attributable to: |
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Owners of the company |
( |
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Kingfisher Resorts Studland Limited
(Registration number: 10417689)
Consolidated Balance Sheet as at 28 December 2022
Note |
2022 |
2021 |
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Fixed assets |
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Intangible assets |
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Tangible assets |
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Current assets |
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Stocks |
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Debtors |
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Cash at bank and in hand |
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Creditors: Amounts falling due within one year |
( |
( |
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Net current liabilities |
( |
( |
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Total assets less current liabilities |
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Creditors: Amounts falling due after more than one year |
( |
( |
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Provisions for liabilities |
( |
( |
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Net assets |
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Capital and reserves |
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Called up share capital |
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Share premium reserve |
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Retained earnings |
( |
( |
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Equity attributable to owners of the company |
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Shareholders' funds |
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Approved and authorised by the
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Kingfisher Resorts Studland Limited
(Registration number: 10417689)
Balance Sheet as at 28 December 2022
Note |
2022 |
2021 |
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Fixed assets |
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Investments |
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Current assets |
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Debtors |
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Cash at bank and in hand |
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Creditors: Amounts falling due within one year |
( |
( |
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Net current liabilities |
( |
( |
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Total assets less current liabilities |
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Creditors: Amounts falling due after more than one year |
( |
( |
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Net assets |
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Capital and reserves |
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Called up share capital |
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Share premium reserve |
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Retained earnings |
( |
( |
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Shareholders' funds |
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As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes as it prepares group accounts. The company made a loss after tax for the financial year of £545,291 (2021 - loss of £503,653).
Approved and authorised by the
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Kingfisher Resorts Studland Limited
Consolidated Statement of Changes in Equity
for the Year Ended 28 December 2022
Ordinary share capital |
Share premium |
Profit and loss reserve |
Total |
Total equity |
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At 29 December 2021 |
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( |
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Movement in year : |
|||||
Loss for the year |
- |
- |
( |
( |
( |
Total comprehensive income |
- |
- |
( |
( |
( |
At 28 December 2022 |
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|
( |
|
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Ordinary share capital |
Share premium |
Profit and loss reserve |
Total |
Total equity |
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At 29 December 2020 |
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( |
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Movement in year : |
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Profit for the year |
- |
- |
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Total comprehensive income |
- |
- |
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At 28 December 2021 |
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( |
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Kingfisher Resorts Studland Limited
Statement of Changes in Equity
for the Year Ended 28 December 2022
Ordinary share capital |
Share premium |
Profit and loss reserve |
Total |
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At 29 December 2021 |
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|
( |
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Movement in year : |
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Loss for the year |
- |
- |
( |
( |
Total comprehensive income |
- |
- |
( |
( |
At 28 December 2022 |
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|
( |
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Ordinary share capital |
Share premium |
Profit and loss reserve |
Total |
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At 29 December 2020 |
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( |
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Movement in year : |
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Loss for the year |
- |
- |
( |
( |
Total comprehensive income |
- |
- |
( |
( |
At 28 December 2021 |
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( |
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Kingfisher Resorts Studland Limited
Consolidated Statement of Cash Flows
for the Year Ended 28 December 2022
Note |
2022 |
2021 |
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Cash flows from operating activities |
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(Loss)/profit for the year |
( |
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Adjustments to cash flows from non-cash items |
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Depreciation and amortisation |
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Finance costs |
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Income tax expense |
- |
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Working capital adjustments |
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Decrease/(increase) in stocks |
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( |
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(Increase)/decrease in trade and other debtors |
( |
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Increase in trade and other creditors |
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Net cash flow from operating activities |
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Cash flows from investing activities |
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Acquisitions of tangible assets |
( |
( |
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Cash flows from financing activities |
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Interest paid |
( |
( |
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Repayment of bank borrowing |
( |
( |
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Net cash flows from financing activities |
( |
( |
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Net (decrease)/increase in cash and cash equivalents |
( |
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Cash and cash equivalents at 29 December 2021 |
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Cash and cash equivalents at 28 December 2022 |
58,595 |
821,407 |
Kingfisher Resorts Studland Limited
Notes to the Financial Statements
for the Year Ended 28 December 2022
General information |
The company is a private company limited by share capital, incorporated in England and Wales.
The address of its registered office is:
United Kingdom
The principal place of business is:
Knoll House Hotel, Ferry Rd, Studland
Swanage
Dorset
BH19 3AH
United Kingdom
Accounting policies |
Summary of significant accounting policies and key accounting estimates
The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.
Statement of compliance
These financial statements were prepared in accordance with Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' and the Companies Act 2006.
Basis of preparation
These financial statements have been prepared using the historical cost convention except that as disclosed in the accounting policies certain items are shown at fair value.
These financial statements are presented in Sterling (£).
Basis of consolidation
The consolidated financial statements consolidate the financial statements of the company and its subsidiary undertakings drawn up to 28 December 2022.
The parent has taken advantage of s408 of the Companies Act 2006 and has not included its own profit and loss account in these financial statements. The parent company's profit for the financial year is disclosed below its balance sheet within these accounts.
Kingfisher Resorts Studland Limited
Notes to the Financial Statements
for the Year Ended 28 December 2022
A subsidiary is an entity controlled by the company. Control is achieved where the company has the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities.
The results of subsidiaries acquired or disposed of during the year are included in the Profit and Loss Account from the effective date of acquisition or up to the effective date of disposal, as appropriate. Where necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with those used by the group.
The purchase method of accounting is used to account for business combinations that result in the acquisition of subsidiaries by the group. The cost of a business combination is measured as the fair value of the assets given, equity instruments issued and liabilities incurred or assumed at the date of exchange, plus costs directly attributable to the business combination. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. Any excess of the cost of the business combination over the acquirer’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities recognised is recorded as goodwill.
Inter-company transactions, balances and unrealised gains on transactions between the company and its subsidiaries, which are related parties, are eliminated in full.
Intra-group losses are also eliminated but may indicate an impairment that requires recognition in the consolidated financial statements.
Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the group. Non-controlling interests in the net assets of consolidated subsidiaries are identified separately from the group’s equity therein. Non-controlling interests consist of the amount of those interests at the date of the original business combination and the non-controlling shareholder’s share of changes in equity since the date of the combination.
Kingfisher Resorts Studland Limited
Notes to the Financial Statements
for the Year Ended 28 December 2022
Going concern
The group operates the Knoll House Hotel Ltd, a unique property in Studland in Dorset, via its subsidiary company, Knoll House Hotel Ltd. The group is seeking to obtain planning permission to develop the hotel. The group generated an operating profit in 2022 of £329k but after interest charges, the group made a loss after tax of £190k. The results for 2023 are similar to those of 2022 and the directors anticipate similar results in 2024.
The group has invested significant sums in the planning process to date (which are included within Land and buildings) and on 24 January 2024, the latest planning application was turned down. The Directors are now preparing a revised application and believe there is strong political support for approval and remain positive about obtaining approval for a revised application. However, this means further delay and additional costs will be incurred in both the planning process and interest charges. Whilst the directors are confident that agreement can be reached with the planning authorities in the long run, some uncertainty remains whilst planning approval has not been achieved.
The group finances its ongoing working capital and capex requirements using bank and other borrowings. Subsequent to the year end and prior to the date of approval of these accounts, the subsidiary company has drawn down additional bank and lease finance of £434k and this has been factored in to forecasts prepared.
As set out in note 20, the company has borrowing of £3,050,000 which is on a rolling three-month basis. Accrued interest of just over £1m is due to the lender at 31 December 2022 and is unpaid with their agreement. As at 31 December 2023, the accrued interest not paid amounts to £1.4m. This has been in place since June 2017 and the directors have obtained confirmation from the lender that their intention is that this funding will continue to be available to the company until at least 30 April 2024.
The directors have prepared forecasts which demonstrate that the group can continue to meet its liabilities as they fall due on the basis that the existing funding in place continues to be available to the company and that the group’s trading continues to provide positive cash flow similar to existing levels. Whilst the confirmation from the lender described above does not provide certainty, alongside the previous history of this funding being rolled over, the strong trading position of the hotel itself and the assets of the group to support a re-financing should that be necessary, the directors consider that the company and the group have adequate resources to continue in operational existence for a period of at least 12 months from the approval of these financial statements and therefore they continue to adopt the going concern basis of accounting in preparing these financial statements.
Turnover recognition
Turnover comprises the fair value of the consideration received or receivable for the sale of goods and provision of services in the ordinary course of the group’s activities. Turnover is shown net of sales/value added tax, returns, rebates and discounts and after eliminating sales within the group.
Room sales are recognised at the point that the room is used by the customer. Food and drink sales are recognised at the point of sale.
Kingfisher Resorts Studland Limited
Notes to the Financial Statements
for the Year Ended 28 December 2022
Government grants
Government grants are recognised under the accruals model resulting in income being recognised on a systematic basis over the period in which the related costs are incurred for which the grant is compensating. The income from the scheme is recognised as other income in the profit and loss and timing differences presented as other debtors or deferred income within the balance sheet.
Tax
The tax expense for the period comprises tax. Tax is recognised in the profit and loss account, except that a change attributable to an item of income or expense recognised as other comprehensive income is also recognised directly in other comprehensive income.
Deferred tax is recognised on timing differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements and on unused tax losses or tax credits in the group. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.
The carrying amount of deferred tax assets are reviewed at each reporting date and a valuation allowance is set up against deferred tax assets so that the net carrying amount equals the highest amount that is more likely than not to be recovered based on current or future taxable profit.
Deferred tax liabilities are presented within provisions for liabilities on the balance sheet.
Tangible assets
Tangible assets are stated at cost, less accumulated depreciation and accumulated impairment losses.
The cost of tangible assets includes directly attributable incremental costs incurred in their acquisition and installation.
Depreciation
Depreciation is charged so as to write off the cost of assets to their residual value, other than land and properties under construction over their estimated useful lives, as follows:
Asset class |
Depreciation method and rate |
Fixtures, fittings and equipment |
5% - 25% straight line |
Land and Buildings - not depreciated |
Not depreciated until work complete |
The land and buildings are not depreciated during the current phase of development given the level of expenditure in progress and the residual value of the land and buildings.
Goodwill
Goodwill arising on the acquisition of an entity represents the excess of the cost of acquisition over the group’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities of the entity recognised at the date of acquisition. Goodwill is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is held in the currency of the acquired entity and revalued to the closing rate at each reporting period date. Goodwill is amortised over its useful life, which shall not exceed ten years if a reliable estimate of the useful life cannot be made.
Kingfisher Resorts Studland Limited
Notes to the Financial Statements
for the Year Ended 28 December 2022
Amortisation
Amortisation is provided on intangible assets so as to write off the cost, less any estimated residual value, over their useful life as follows:
Asset class |
Amortisation method and rate |
Goodwill |
Straight line over ten years |
Investments
Investments in equity shares which are publicly traded or where the fair value can be measured reliably are initially measured at fair value, with changes in fair value recognised in profit or loss. Investments in equity shares which are not publicly traded and where fair value cannot be measured reliably are measured at cost less impairment.
Interest income on debt securities, where applicable, is recognised in income using the effective interest method. Dividends on equity securities are recognised in income when receivable.
Cash and cash equivalents
Cash and cash equivalents comprise cash on hand and call deposits, and other short-term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of change in value.
Trade debtors
Trade debtors are amounts due from customers for goods sold or services performed in the ordinary course of business.
Trade debtors are recognised initially at the transaction price. They are subsequently measured at amortised cost using the effective interest method, less provision for impairment. A provision for the impairment of trade debtors is established when there is objective evidence that the group will not be able to collect all amounts due according to the original terms of the receivables.
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost is determined using the first-in, first-out (FIFO) method.
At each reporting date, stocks are assessed for impairment. If stocks are impaired, the carrying amount is reduced to its selling price less costs to complete and sell; the impairment loss is recognised immediately in profit or loss.
Kingfisher Resorts Studland Limited
Notes to the Financial Statements
for the Year Ended 28 December 2022
Trade creditors
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers.
Trade creditors are recognised initially at the transaction price and subsequently measured at amortised cost using the effective interest method.
Accruals consist of interest payable arising on the group's loan borrowings and also obligations to pay for goods or services not yet invoiced that have been acquired in the ordinary course of business from suppliers.
Accruals are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method.
Other creditors are initially measured at the transaction price and subsequently measured at amortised cost using the effective interest method. Other creditors include deposits held on behalf of customers in regard to future bookings.
Creditors are classified as current liabilities if the group does not have an unconditional right, at the end of the reporting period, to defer settlement of the creditor for at least twelve months after the reporting date. If there is an unconditional right to defer settlement for at least twelve months after the reporting date, they are presented as non-current liabilities.
Borrowings
Interest-bearing borrowings are initially recorded at fair value, net of transaction costs. Interest-bearing borrowings are subsequently carried at amortised cost, with the difference between the proceeds, net of transaction costs, and the amount due on redemption being recognised as a charge to the Profit and Loss Account over the period of the relevant borrowing.
Interest expense is recognised on the basis of the effective interest method and is included in interest payable and similar charges.
Borrowings are classified as current liabilities unless the group has an unconditional right to defer settlement of the liability for at least twelve months after the reporting date.
Assets held under hire purchase agreements are capitalised as tangible fixed assets with the future obligation being recognised as a liability. Finance costs are recognised in the Profit and Loss Account calculated at a constant periodic rate of interest over the term of the liability.
Leases
Leases in which substantially all the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases are charged to profit or loss on a straight-line basis over the period of the lease.
Share capital
Ordinary shares are classified as equity. Equity instruments are measured at the fair value of the cash or other resources received or receivable, net of the direct costs of issuing the equity instruments. If payment is deferred and the time value of money is material, the initial measurement is on a present value basis.
Kingfisher Resorts Studland Limited
Notes to the Financial Statements
for the Year Ended 28 December 2022
Defined contribution pension obligation
The group operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the group pays fixed contributions into a separate entity. Once the contributions have been paid the group has no further payments obligations.
The contributions are recognised as an expense in the profit and loss account when they fall due. Amounts not paid are shown in accruals as a liability in the balance sheet. The assets of the plan are held separately from the group in independently administered funds.
Reserves
Called up share capital represents the nominal value of shares that have been issued.
Share premium account includes any premiums received on the issue of share capital. Transaction costs associated with the issuing of shares are deducted from the share premium.
Profit and loss account includes all current and prior period profits and losses.
Critical accounting judgments and key sources of estimation uncertainty
In the application of the group’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 revision and future period 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.
Land and buildings
Expenditure that relates to the freehold property of the group is judged by management as that which is incurred in the development of the property, will enhance that property and which will in future provide returns over a reasonable economic life.
Key sources of estimation uncertainty
The directors have made an assessment that no impairment of the freehold property is required. The group has applied for planning permission to further develop the freehold property and continues to incur costs to obtain that planning permission as well as to develop the existing hotel. The directors have assumed that planning permission will be obtained when making their assessment as this is their expectation. Should planning permission for development not be obtained, the level of future returns from the property will need re-evaluating. This could result in an impairment being required although the directors consider this unlikely. The carrying amount of freehold property is £9,608,648 (2021: £9,233,910).
Kingfisher Resorts Studland Limited
Notes to the Financial Statements
for the Year Ended 28 December 2022
Turnover |
All turnover is derived from the operation of the hotel.
Other operating income |
The analysis of the group's other operating income for the year is as follows:
2022 |
2021 |
|
Government grants |
- |
|
Operating profit |
Arrived at after charging/(crediting):
2022 |
2021 |
|
Depreciation expense |
|
|
Amortisation expense |
|
|
Operating lease expense - plant and machinery |
|
|
Interest payable and similar expenses |
2022 |
2021 |
|
Interest on bank overdrafts and borrowings |
|
|
Interest expense on other finance liabilities |
|
|
|
|
Kingfisher Resorts Studland Limited
Notes to the Financial Statements
for the Year Ended 28 December 2022
Staff costs |
The aggregate payroll costs (including directors' remuneration) were as follows:
2022 |
2021 |
|
Wages and salaries |
|
|
Social security costs |
|
|
Pension costs, defined contribution scheme |
|
|
|
|
The average number of persons employed by the group (including directors) during the year, analysed by category was as follows:
2022 |
2021 |
|
Administration and support |
|
|
Other departments |
|
|
|
|
Auditors' remuneration |
2022 |
2021 |
|
Audit of these financial statements |
3,600 |
3,600 |
Audit of the financial statements of subsidiaries of the company pursuant to legislation |
6,700 |
6,700 |
|
|
Kingfisher Resorts Studland Limited
Notes to the Financial Statements
for the Year Ended 28 December 2022
Taxation |
Tax charged/(credited) in the profit and loss account:
2022 |
2021 |
|
Deferred taxation |
||
Arising from origination and reversal of timing differences |
- |
|
The tax on profit before tax for the year is higher than the standard rate of corporation tax in the UK (2021 - higher than the standard rate of corporation tax in the UK) of
The differences are reconciled below:
2022 |
2021 |
|
(Loss)/profit before tax |
( |
|
Corporation tax at standard rate |
( |
|
Deferred tax expense relating to changes in tax rates or laws |
- |
|
Increase/(decrease) from tax losses for which no deferred tax asset was recognised |
|
( |
Tax increase from effect of capital allowances and depreciation |
- |
|
Other tax effects for reconciliation between accounting profit and tax expense (income) |
- |
|
Total tax charge |
- |
|
Deferred tax
Group
Deferred tax assets and liabilities
2022 |
Asset |
Liability |
Revaluation of property |
- |
|
Tax losses carried forward |
|
- |
|
|
2021 |
Asset |
Liability |
Revaluation of property |
- |
|
Tax losses carried forward |
|
- |
|
|
Kingfisher Resorts Studland Limited
Notes to the Financial Statements
for the Year Ended 28 December 2022
Intangible assets |
Group
Goodwill |
Total |
|
Cost or valuation |
||
At 29 December 2021 |
|
|
At 28 December 2022 |
|
|
Amortisation |
||
At 29 December 2021 |
|
|
Amortisation charge |
|
|
At 28 December 2022 |
|
|
Carrying amount |
||
At 28 December 2022 |
|
|
At 28 December 2021 |
|
|
Tangible assets |
Group
Land and buildings |
Furniture, fittings and equipment |
Total |
|
Cost or valuation |
|||
At 29 December 2021 |
|
|
|
Additions |
|
|
|
At 28 December 2022 |
|
|
|
Depreciation |
|||
At 29 December 2021 |
- |
|
|
Charge for the year |
- |
|
|
At 28 December 2022 |
- |
|
|
Carrying amount |
|||
At 28 December 2022 |
|
|
|
At 28 December 2021 |
|
|
|
Included within the net book value of land and buildings above is £9,608,648 (2021 - £9,233,910) in respect of freehold land and buildings.
Kingfisher Resorts Studland Limited
Notes to the Financial Statements
for the Year Ended 28 December 2022
Investments |
Group
Details of undertakings
Details of the investments (including principal place of business of unincorporated entities) in which the group holds 20% or more of the nominal value of any class of share capital are as follows:
Undertaking |
Registered office |
Holding |
Proportion of voting rights and shares held |
||||
2022 |
2021 |
||||||
Subsidiary undertakings |
|||||||
|
Hyde Park House, 5 Manfred Road, London, United Kingdom, SW15 2RS |
|
|
|
|||
* indicates direct investment of the company
Subsidiary undertakings
Knoll House Hotel Limited The principal activity of Knoll House Hotel Limited is |
Company
2022 |
2021 |
|
Investments in subsidiaries |
|
|
Subsidiaries |
£ |
Cost or valuation |
|
At 29 December 2021 |
|
Provision |
|
Carrying amount |
|
At 28 December 2022 |
|
At 28 December 2021 |
|
Kingfisher Resorts Studland Limited
Notes to the Financial Statements
for the Year Ended 28 December 2022
Stocks |
Group |
Company |
|||
2022 |
2021 |
2022 |
2021 |
|
Finished goods and goods for resale |
|
|
- |
- |
Debtors |
Group |
Company |
|||
Current |
2022 |
2021 |
2022 |
2021 |
Trade debtors |
|
|
- |
- |
Amounts owed by group undertakings |
- |
- |
- |
|
Other debtors |
|
|
|
|
Prepayments |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
Group |
Company |
|||
2022 |
2021 |
2022 |
2021 |
|
Cash on hand |
|
|
- |
- |
Cash at bank |
|
|
|
|
|
|
|
|
Kingfisher Resorts Studland Limited
Notes to the Financial Statements
for the Year Ended 28 December 2022
Creditors |
Group |
Company |
||||
Note |
2022 |
2021 |
2022 |
2021 |
|
Due within one year |
|||||
Loans and borrowings |
|
|
|
|
|
Trade creditors |
|
|
|
|
|
Amounts owed to group undertakings |
- |
- |
662,902 |
- |
|
Social security and other taxes |
|
|
- |
- |
|
Outstanding defined contribution pension costs |
|
|
- |
- |
|
Other creditors |
|
|
|
|
|
Accrued expenses |
|
|
|
|
|
|
|
|
|
||
Due after one year |
|||||
Loans and borrowings |
|
|
|
|
|
Other non-current financial liabilities |
|
|
|
|
|
2,556,923 |
2,661,313 |
2,234,423 |
2,308,813 |
Kingfisher Resorts Studland Limited
Notes to the Financial Statements
for the Year Ended 28 December 2022
Provisions for liabilities |
Group
Deferred tax |
Total |
|
At 29 December 2021 |
|
|
At 28 December 2022 |
|
|
|
Pension and other schemes |
Defined contribution pension scheme
The group operates a defined contribution pension scheme. The pension cost charge for the year represents contributions payable by the group to the scheme and amounted to £
Contributions totalling £
Share capital |
Allotted, called up and fully paid shares
2022 |
2021 |
|||
No. |
£ |
No. |
£ |
|
|
|
48,000 |
|
48,000 |
|
|
1,000 |
|
1,000 |
|
|
|
|
Rights, preferences and restrictions
Ordinary A and B have the following rights, preferences and restrictions: |
Kingfisher Resorts Studland Limited
Notes to the Financial Statements
for the Year Ended 28 December 2022
Loans and borrowings |
Group |
Company |
|||
2022 |
2021 |
2022 |
2021 |
|
Current loans and borrowings |
||||
Bank borrowings |
|
|
|
|
Other borrowings |
|
|
|
|
|
|
|
|
Group |
Company |
|||
2022 |
2021 |
2022 |
2021 |
|
Non-current loans and borrowings |
||||
Bank borrowings |
|
|
|
|
Bank borrowings
The bank borrowings are secured by a debenture and first charge on the assets of the group, which includes freehold property owned by these companies. Interest is payable on these borrowings at rates between 3.15% and 4% per annum over base. Amounts due in more than five years are repayable by instalments, with the final instalment due April 2038.
Other borrowings
The other borrowings were obtained to finance the purchase of the subsidiary's undertaking and are secured by a second charge on the assets of the group, including freehold property owned by these companies. The other borrowings have a nominal interest rate of 12% per annum and are on a rolling three-month renewal basis which have continued to be renewed since year end and the directors are confident this will continue to be the case as they continue their long-term business plan to develop the land and property.
Kingfisher Resorts Studland Limited
Notes to the Financial Statements
for the Year Ended 28 December 2022
Bank loans and overdrafts after five years
Group
Included in the loans and borrowings are the following amounts due after more than five years:
2022 |
2021 |
|
After more than five years by instalments |
|
|
Company
Included in the loans and borrowings are the following amounts due after more than five years:
2022 |
2021 |
|
After more than five years by instalments |
|
|
- |
- |
Obligations under leases and hire purchase contracts |
Group
Operating leases
The total of future minimum lease payments is as follows:
2022 |
2021 |
|
Not later than one year |
|
|
Later than one year and not later than five years |
|
|
|
|
The amount of non-cancellable operating lease payments recognised as an expense during the year was £
Related party transactions |
Group
Key management personnel
Key management personnel are considered to be the executive directors, N Chapman and A Nares. Key management personnel do not receive a salary from the group.
Summary of transactions with entities with joint control or significant interest
Kingfisher Resorts Studland Limited
Notes to the Financial Statements
for the Year Ended 28 December 2022
Summary of transactions with other related parties
Company
Summary of transactions with all subsidiaries