Company registration number 03220671 (England and Wales)
EASTCLIFFE NEWS SHOPS LIMITED
FINANCIAL STATEMENTS
FOR THE YEAR ENDED 27 MARCH 2023
PAGES FOR FILING WITH REGISTRAR
EASTCLIFFE NEWS SHOPS LIMITED
CONTENTS
Page
Balance sheet
1
Notes to the financial statements
2 - 7
EASTCLIFFE NEWS SHOPS LIMITED
BALANCE SHEET
AS AT
27 MARCH 2023
27 March 2023
- 1 -
2023
2022
Notes
£000
£000
£000
£000
Fixed assets
Intangible assets
3
4
31
Tangible assets
4
25
28
29
59
Current assets
Stocks
376
492
Debtors
5
323
109
Net current assets
699
601
Net assets
728
660
Capital and reserves
Called up share capital
6
Profit and loss reserves
728
660
Total equity
728
660
The directors of the company have elected not to include a copy of the profit and loss account within the financial statements.true
These financial statements have been prepared and delivered 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 23 December 2023 and are signed on its behalf by:
M J Titterton
Director
Company registration number 03220671 (England and Wales)
EASTCLIFFE NEWS SHOPS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 27 MARCH 2023
- 2 -
1
Accounting policies
Company information
Eastcliffe News Shops Limited is a private company limited by shares incorporated in England and Wales. The registered office is Hazel Court, Midland Way, Barlborough Links, Chesterfield, Derbyshire, S43 4FD.
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 as applicable to companies subject to the small companies regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.
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 £000.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
1.2
Going concern
Eastcliffe News Shops Limited is a member of a group headed up by James Convenience Retail Limited. The company's financial position is very closely linked to that of the group.true
At 26 March 2023 the group's balance sheet showed shareholders' funds of deficit £573,000 (2022: £272,000). The directors are mindful that at 26 March 2023 the group had net currents liabilities of £1,076,000 (2022: net current liabilities of £1,070,000).
The year was one of growth and optimism as the group returned to a profitable EBITDA following on from several years of difficult trade due to the Covid pandemic. Locations situated in passenger interchanges, town centres and shopping centres experienced considerable growth on recent years as customer confidence returned and footfall through these locations increased.
During the year the group successfully managed to dispose of several loss making stores that had become commercial unviable given the lasting impact of Covid on trade in those locations. This has helped bolster the stability of the group and further the store EBITDA projections for the upcoming financial year.
Working closely with our wholesale partner, Bestway Wholesale Limited and its subsidiaries, the group have been able to refurbish and refit several of its convenience stores to the Costcutter brand. The result of which has significantly increased turnover in these locations through an improved range of product available and a recognised brand for our customer base.
In addition to the rebranding of stores, the group has also spent capital in order to refurbish existing sites and investment in its food to go offer, which has helped to establish a sustainable business model for the long term.
The board have prepared detailed profit and cashflow for the years ending March 2024 and March 2025 which shows the group continuing to generate an EBITDA profit. The forecasts are based on the director’s experience of trading during the last 9 months and anticipated costs increases such as National Minimum Wage.
The forecasts show that the group is expected to operate within existing borrowing facilities. On the basis of the forecasts the directors are satisfied that the group is able to meet its liabilities as they fall due for the foreseeable future and such as the financial statements have been prepared on a going concern basis.
EASTCLIFFE NEWS SHOPS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 27 MARCH 2023
1
Accounting policies
(Continued)
- 3 -
1.3
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.
Eastcliffe News Shops Limited has various other income streams which are complementary to operating convenience store such as commissions, rental income and news delivery charges. News delivery charges are shown net of expenses.
1.4
Intangible fixed assets - goodwill
Goodwill represents the excess of the cost of acquisition of unincorporated businesses over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life which is its franchise period, which is 20 years.
1.5
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 improvements
5 years straight line
Fixtures, fittings and motor vehicles
5 years straight line
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 credited or charged to profit or loss.
1.6
Impairment of fixed assets
At each reporting period end date, the company reviews the carrying amounts of its tangible and intangible 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).
1.7
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials
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.
1.8
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
EASTCLIFFE NEWS SHOPS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 27 MARCH 2023
1
Accounting policies
(Continued)
- 4 -
Basic financial assets
Basic financial assets, which include debtors, 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.
Basic financial liabilities
Basic financial liabilities, including loans from fellow group are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
1.9
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
1.10
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the 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 company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the 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 when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
1.11
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense.
1.12
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.13
Leases
EASTCLIFFE NEWS SHOPS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 27 MARCH 2023
1
Accounting policies
(Continued)
- 5 -
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 leases asset are consumed.
Rental income from operating leases is recognised on a straight line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight line basis over the lease term.
2
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Total
37
67
3
Intangible fixed assets
Trademarks and franchise agreements
£000
Cost
At 28 March 2022
121
Additions
3
Transfers
(117)
At 27 March 2023
7
Amortisation and impairment
At 28 March 2022
90
Transfers
(87)
At 27 March 2023
3
Carrying amount
At 27 March 2023
4
At 27 March 2022
31
EASTCLIFFE NEWS SHOPS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 27 MARCH 2023
- 6 -
4
Tangible fixed assets
Leasehold improvements
Fixtures, fittings and motor vehicles
Total
£000
£000
£000
Cost
At 28 March 2022
2
157
159
Additions
13
13
Transfers
(2)
(46)
(48)
At 27 March 2023
124
124
Depreciation and impairment
At 28 March 2022
1
130
131
Depreciation charged in the year
10
10
Transfers
(2)
(40)
(42)
At 27 March 2023
(1)
100
99
Carrying amount
At 27 March 2023
1
24
25
At 27 March 2022
1
27
28
5
Debtors
2023
2022
Amounts falling due within one year:
£000
£000
Amounts owed by group undertakings
305
22
Deferred tax asset
18
87
323
109
6
Called up share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£000
£000
2 Ordinary shares of £1 each
2
2
-
-
7
Audit report information
As the income statement has been omitted from the filing copy of the financial statements, the following information in relation to the audit report on the statutory financial statements is provided in accordance with s444(5B) of the Companies Act 2006:
The auditor's report was unqualified.
Senior Statutory Auditor:
Paul Winwood
Statutory Auditor:
BHP LLP
EASTCLIFFE NEWS SHOPS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 27 MARCH 2023
- 7 -
8
Financial commitments, guarantees and contingent liabilities
The company is party to an omnibus guarantee covering the bank borrowings of the wider group. As at 27 March 2023 these borrowings totalled £nil (2022: £2,136,756).
9
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, as follows:
2023
2022
£000
£000
135
447
10
Related party transactions
As the company is a wholly-owned subsidiary of a company whose consolidated accounts include the results of the subsidiary and are publicly available, the company has taken advantage of FRS 102 Section 33.1A exemption from disclosing transactions with group undertakings where 100% of the voting rights are within the group.
11
Parent company
The company's immediate parent company is Rippleglen Limited. The ultimate parent company is James Convenience Retail Limited.
Both Rippleglen Limited and James Convenience Retail Limited are incorporated in England and Wales and share the registered office of the company as detailed on the company information page.
The smallest and largest group for which group financial statements are prepared is James Convenience Retail Limited. Consolidated accounts are available form Companies House, Cardiff, CF14 3UZ.
James Convenience Retail Limited is controlled by J M James.