Company Registration No. 05762290 (England and Wales)
AZUR LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
AZUR LIMITED
COMPANY INFORMATION
Directors
Prince M B S Al Saud
N Budzynski
V A A Cassin
Secretary
Cornhill Secretaries Limited
Company number
05762290
Registered office
5 Market Yard Mews
194-204 Bermondsey Street
London
SE1 3TQ
United Kingdom
Auditor
HW Fisher LLP
Acre House
11-15 William Road
London
NW1 3ER
United Kingdom
AZUR LIMITED
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3 - 4
Independent auditor's report
5 - 7
Profit and loss account
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 - 28
AZUR LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022
- 1 -

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

Fair review of the business

The group made a pre-tax profit of £1.6 million (2021: loss £6m) for the year on a turnover of £15 million (2021: £6 million - 16 month period). In 2021, the parent company has incurred £6.37 million of exceptional costs in relation to the group acquisition.

 

As at 31 December 2022, the group had net liabilities of £1,273,712 (2021: £2,424,602).

 

In the year 2022, the group managed to return its level of operations to pre-pandemic levels while remaining profitable. The group focused on cost control in a difficult economic environment characterised by continued high inflation.

Principal risks and uncertainties

The principal risks and uncertainties facing the group are:

 

 

 

 

 

 

Key performance indicators

In the opinion of the directors, there are several key performance indicators whose disclosure is necessary for an understanding of the development, performance or position of the business.

 

These are viewed before any exceptional costs are incurred.

 

The key performance indicators that are taken into consideration when managing the restaurants are:

 

 

These are compared to budgets and those achieved in previous years.

 

The Group uses a range of financial key performance indicators to drive performance and monitor and manage the business effectively. These are reported firmwide on a daily, weekly, and monthly basis against targets. The key financial performance indicators for the year were as follows:

AZUR LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 2 -
Key performance indicators - continued

 

2022

2021

(16-month period)

 

£

£

Revenue

15 million

6 million

Gross profit margin

56%

14%

Staff costs

37%

85%

EBITA

64%

27%

 

 

 

On behalf of the board

N Budzynski
Director
5 February 2024
AZUR LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022
- 3 -

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

Principal activities

The principal activity of the company and group continued to be that of restaurateurs.

Results and dividends

The results for the year are set out on page 8.

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:

Prince M B S Al Saud
N Budzynski
V A A Cassin
K B Ramchand
(Resigned 1 January 2023)
A C Waney
(Resigned 1 January 2023)
Auditor

The auditor, HW Fisher LLP, is deemed to be reappointed under section 487(2) of the Companies Act 2006.

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.

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.

AZUR LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 4 -
On behalf of the board
N Budzynski
Director
5 February 2024
AZUR LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF AZUR LIMITED
- 5 -

Qualified opinion on financial statements

We have audited the financial statements of Azur Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2022 which comprise the group profit and loss account, 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 FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion, except for the possible effects of the matter described in the Basis for Qualified Opinion section of our audit report, the financial statements:

Basis for qualified opinion

We were not appointed as auditor of the group until after 31 December 2021 and thus did not observe the counting of physical stock at the end of 31 December 2021. We were unable to satisfy ourselves by alternative means concerning the group and parent company stock quantities of £606,483 and £291,626 respectively held at 31 December 2021 by using other audit procedures. Since opening stocks enter into the determination of the financial performance and cashflows, we were unable to determine whether adjustments might have been necessary in respect of the profit for the year reported in the group statement of comprehensive income and the net cash flows from operating activities reported in the group statement of cash flows. In addition, were any adjustment to be required, the strategic report would also need to be amended.

 

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 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 qualified 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.

 

As described in the basis for qualified opinion section of our report, we were unable to satisfy ourselves concerning the group and the parent company stock quantities of £606,483 and £291,626 respectively held at 31 December 2021. We have concluded that where the other information refers to cost of sales or profits, it may be materially misstated for the same reason.

AZUR LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF AZUR LIMITED
- 6 -

Opinions on other matters prescribed by the Companies Act 2006

Except for the possible effects of the matter described in the Basis for qualified opinion section of our report, in our opinion, based on the work undertaken in the course of our audit:

Matters on which we are required to report by exception

Except for the matter described in the basis for Qualified opinion section of our report, in the light of the knowledge and understanding of the group and the parent company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report and the directors' report.

 

In respect solely of the limitation on our work relating to stock, described above:

 

 

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:

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 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.

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.

AZUR LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF AZUR LIMITED
- 7 -

As part of our planning process:

 

 

The key procedures we undertook to detect irregularities including fraud during the course of the audit included:

 

 

Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements even though we have properly planned and performed our audit in accordance with auditing standards. The primary responsibility for the prevention and detection of irregularities and fraud rests with the those charged with governance of the group.

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.

Russell Nathan (Senior Statutory Auditor)
For and on behalf of HW Fisher LLP
Chartered Accountants
Statutory Auditor
Acre House
11-15 William Road
London
NW1 3ER
United Kingdom
5 February 2024
AZUR LIMITED
GROUP PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2022
- 8 -
2022
2021
Notes
£
£
Turnover
3
14,957,344
6,103,847
Cost of sales
(6,485,412)
(5,260,007)
Gross profit
8,471,932
843,840
Administrative expenses
(7,584,896)
(4,679,210)
Other operating income
766,821
3,132,461
Exceptional item
4
-
(6,372,728)
Operating profit/(loss)
5
1,653,857
(7,075,637)
Interest receivable and similar income
9
2,365
88
Interest payable and similar expenses
10
-
(1,101)
Amounts written off investments
11
-
1,121,127
Profit/(loss) before taxation
1,656,222
(5,955,523)
Tax on profit/(loss)
12
(532,142)
1,441,008
Profit/(loss) for the financial year
1,124,080
(4,514,515)
Profit/(loss) for the financial year is all attributable to the owners of the parent company.
AZUR LIMITED
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2022
- 9 -
2022
2021
£
£
Profit/(loss) for the year
1,124,080
(4,514,515)
Other comprehensive income
Currency translation differences
26,810
(55,317)
Total comprehensive income for the year
1,150,890
(4,569,832)
Total comprehensive income for the year is all attributable to the owners of the parent company.
AZUR LIMITED
GROUP BALANCE SHEET
AS AT
31 DECEMBER 2022
31 December 2022
- 10 -
2022
2021
Notes
£
£
£
£
Fixed assets
Goodwill
13
346,980
390,953
Tangible assets
14
2,905,467
3,546,644
3,252,447
3,937,597
Current assets
Stocks
17
766,826
606,483
Debtors
18
2,022,910
2,676,585
Cash at bank and in hand
3,614,518
8,048,271
6,404,254
11,331,339
Creditors: amounts falling due within one year
19
(10,875,332)
(17,264,208)
Net current liabilities
(4,471,078)
(5,932,869)
Total assets less current liabilities
(1,218,631)
(1,995,272)
Creditors: amounts falling due after more than one year
20
(55,081)
(429,330)
Net liabilities
(1,273,712)
(2,424,602)
Capital and reserves
Called up share capital
23
215,054
215,054
Profit and loss reserves
(1,488,766)
(2,639,656)
Total equity
(1,273,712)
(2,424,602)
The financial statements were approved by the board of directors and authorised for issue on 5 February 2024 and are signed on its behalf by:
N Budzynski
Director
AZUR LIMITED
COMPANY BALANCE SHEET
AS AT
31 DECEMBER 2022
31 December 2022
- 11 -
2022
2021
Notes
£
£
£
£
Fixed assets
Tangible assets
14
1,108,943
1,666,399
Investments
15
1,964,057
1,964,057
3,073,000
3,630,456
Current assets
Stocks
17
329,065
291,626
Debtors
18
2,031,769
2,872,047
Cash at bank and in hand
1,838,451
7,003,187
4,199,285
10,166,860
Creditors: amounts falling due within one year
19
(9,530,663)
(16,243,277)
Net current liabilities
(5,331,378)
(6,076,417)
Total assets less current liabilities
(2,258,378)
(2,445,961)
Creditors: amounts falling due after more than one year
20
-
(208,877)
Net liabilities
(2,258,378)
(2,654,838)
Capital and reserves
Called up share capital
23
215,054
215,054
Profit and loss reserves
(2,473,432)
(2,869,892)
Total equity
(2,258,378)
(2,654,838)

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 £396,460 (2021 - £5,176,242 loss).

The financial statements were approved by the board of directors and authorised for issue on
5 February 2024
05 February 2024
and are signed on its behalf by:
N Budzynski
Director
Company Registration No. 05762290
AZUR LIMITED
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2022
- 12 -
Share capital
Profit and loss reserves
Total controlling interest
Non-controlling interest
Total
£
£
£
£
£
Balance at 1 September 2020
215,054
1,930,176
2,145,230
29,533
2,174,763
Year ended 31 December 2021:
Loss for the year
-
(4,514,515)
(4,514,515)
-
(4,514,515)
Other comprehensive income:
Currency translation differences
-
(55,317)
(55,317)
-
(55,317)
Total comprehensive income for the year
-
(4,569,832)
(4,569,832)
-
(4,569,832)
Acquisition of subsidiary
-
-
-
(29,533)
(29,533)
Balance at 31 December 2021
215,054
(2,639,656)
(2,424,602)
-
(2,424,602)
Year ended 31 December 2022:
Profit for the year
-
1,124,080
1,124,080
-
1,124,080
Other comprehensive income:
Currency translation differences
-
26,810
26,810
-
26,810
Total comprehensive income for the year
-
1,150,890
1,150,890
-
1,150,890
Balance at 31 December 2022
215,054
(1,488,766)
(1,273,712)
-
(1,273,712)
AZUR 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 September 2020
215,054
2,306,350
2,521,404
Year ended 31 December 2021:
Loss and total comprehensive income for the year
-
(5,176,242)
(5,176,242)
Balance at 31 December 2021
215,054
(2,869,892)
(2,654,838)
Year ended 31 December 2022:
Profit and total comprehensive income for the year
-
396,460
396,460
Balance at 31 December 2022
215,054
(2,473,432)
(2,258,378)
AZUR LIMITED
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2022
- 14 -
2022
2021
Notes
£
£
£
£
Cash flows from operating activities
Cash (absorbed by)/generated from operations
27
(4,059,420)
8,029,011
Interest paid
-
(1,101)
Income taxes paid
(34,660)
(323,015)
Net cash (outflow)/inflow from operating activities
(4,094,080)
7,704,895
Investing activities
Purchase of business
-
(1,255,497)
Purchase of tangible fixed assets
(237,749)
-
Interest received
2,365
88
Net cash used in investing activities
(235,384)
(1,255,409)
Financing activities
Repayment of borrowings
-
608,763
Payment of finance leases obligations
(2,332)
-
Net cash (used in)/generated from financing activities
(2,332)
608,763
Net (decrease)/increase in cash and cash equivalents
(4,331,796)
7,058,249
Cash and cash equivalents at beginning of year
8,048,271
1,056,348
Effect of foreign exchange rates
(101,957)
(66,326)
Cash and cash equivalents at end of year
3,614,518
8,048,271
AZUR LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
- 15 -
1
Accounting policies
Company information

Azur Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is 5 Market Yard Mews, 194-204 Bermondsey Street, London, United Kingdom, SE1 3TQ.

 

The group consists of Azur 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 are accounted for at cost less impairment.

1.3
Basis of consolidation

The consolidated group financial statements consist of the financial statements of the parent company Azur 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.

AZUR LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 16 -
1.4
Going concern

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 carried out their assessment of going concern, having taken into account the level of substantial funding received during the year. Based on this, and the committed support of the shareholders and group companies operating overseas, the directors expect the group to have sufficient resources to continue trading and meet its liabilities for at least 12 months from the date of approval of these financial statements. Therefore the directors have continued to adopt the going concern basis in these financial statements.

1.5
Reporting period

The accounts relate the year ended 31 December 2022. The company comparative figures relate to the period 1 September 2020 to 31 December 2021.

1.6
Turnover

Turnover represents the sale of food and drinks in the restaurant and management fees, net of VAT. The sale of food and drinks is recognised as revenue at the point of sale.

 

Management fees are recognised based on the agreed percentage on the sales as per the licence agreement between the group entities.

1.7
Intangible fixed assets - goodwill

Goodwill represents the excess of the cost of acquisition of a business 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 10 years.

 

For the purposes of impairment testing, goodwill is allocated to the cash-generating units expected to benefit from the acquisition. Cash-generating units to which goodwill has been allocated are tested for impairment at least annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit.

1.8
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:

Short term leasehold property
Over the period of lease
Leasehold improvements
12.5% straight line
Kitchen equipment
25% straight line
Fixtures and fittings
12.5 - 25% 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 recognised in the profit and loss account.

AZUR LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 17 -
1.9
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, associates and jointly controlled entities 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.

1.10
Impairment of fixed assets

At each reporting period end date, the group 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). 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.

1.11
Stocks

Stocks are stated at the lower of cost and estimated selling price. The cost of stock includes the purchase of food, beverages and tobacco products.

1.12
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.

1.13
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.

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.

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

1.14
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.

1.15
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 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.

1.16
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.

1.17
Retirement benefits

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

AZUR LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 19 -
1.18
Government grants

Government grants, which includes amount received under the Coronavirus Job Retention Scheme, are recognised at the fair value of the grant received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received. The income is recognised in the other income on a systematic basis over the periods in which the associated costs are incurred, using the accrual model.

1.19
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.

2
Judgements 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 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.

Goodwill

The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.

 

Goodwill reflects the excess of the purchase price of the acquired business over the fair value of net identifiable assets as at 21 December 2021. As a result, the goodwill is amortising on the gross balance of approximately £346,980 on a straight-line basis over ten years.

3
Turnover and other revenue
2022
2021
£
£
Turnover analysed by class of business
Resturant income
14,957,344
6,103,847
2022
2021
£
£
Other significant revenue
Interest income
2,365
88
Grants received
-
360,880
AZUR LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
3
Turnover and other revenue
(Continued)
- 20 -
2022
2021
£
£
Turnover analysed by geographical market
UK
7,483,707
5,880,864
North America
7,473,637
222,983
14,957,344
6,103,847
4
Exceptional item
2022
2021
£
£
Expenditure
Exceptional cost - brand development and expansions
-
6,372,728
5
Operating profit/(loss)
2022
2021
£
£
Operating profit/(loss) for the year is stated after charging/(crediting):
Exchange differences apart from those arising on financial instruments measured at fair value through profit or loss
(367,912)
(3,755)
Government grants
-
(360,880)
Depreciation of owned tangible fixed assets
1,126,218
758,386
Amortisation of intangible assets
43,973
1,054
6
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
62,000
66,585
Audit of the financial statements of the company's subsidiaries
15,649
4,725
77,649
71,310
7
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
53
51
53
51
AZUR LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
7
Employees
(Continued)
- 21 -

Their aggregate remuneration comprised:

Group
Company
2022
2021
2022
2021
£
£
£
£
Wages and salaries
4,480,369
4,555,445
2,510,397
3,081,509
Social security costs
168,185
320,602
168,185
200,782
Pension costs
37,307
36,189
37,307
36,189
4,685,861
4,912,236
2,715,889
3,318,480
8
Directors' remuneration
2022
2021
£
£
Remuneration for qualifying services
-
225,283
Remuneration disclosed above includes the following amounts paid to the highest paid director:
2022
2021
£
£
Remuneration for qualifying services
n/a
n/a
9
Interest receivable and similar income
2022
2021
£
£
Interest income
Interest on bank deposits
128
84
Other interest income
2,237
4
Total income
2,365
88
10
Interest payable and similar expenses
2022
2021
£
£
Other interest
-
1,101
AZUR LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 22 -
11
Amounts written off investments
2022
2021
£
£
Amounts written back to current loans
-
1,121,127
12
Taxation
2022
2021
£
£
Current tax
UK corporation tax on profits for the current period
-
(8,714)
Adjustments in respect of prior periods
-
(380,000)
Total UK current tax
-
(388,714)
Foreign current tax on profits for the current period
34,660
-
Total current tax
34,660
(388,714)
Deferred tax
Origination and reversal of timing differences
497,482
(1,052,294)
Total tax charge/(credit)
532,142
(1,441,008)

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

2022
2021
£
£
Profit/(loss) before taxation
1,656,222
(5,955,523)
Expected tax charge/(credit) based on the standard rate of corporation tax in the UK of 19.00% (2021: 19.00%)
314,682
(1,131,549)
Tax effect of expenses that are not deductible in determining taxable profit
2,023
11,586
Under/(over) provided in prior years
-
(8,713)
Foreign exchange differences
(3,050)
(5,769)
Movement in deferred tax not recognised
497,482
(1,052,294)
Fixed asset differences
105,113
91,538
Effect of profits arising in foreign subsidiary
(121,039)
(80,273)
Losses carry forward/back
(263,069)
716,688
Tax effect on PYA
-
18,144
Tax effecton Overseas income
-
(366)
Taxation charge/(credit)
532,142
(1,441,008)
AZUR LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 23 -
13
Intangible fixed assets
Group
Goodwill
£
Cost
At 1 January 2022 and 31 December 2022
392,007
Amortisation and impairment
At 1 January 2022
1,054
Amortisation charged for the year
43,973
At 31 December 2022
45,027
Carrying amount
At 31 December 2022
346,980
At 31 December 2021
390,953
The company had no intangible fixed assets at 31 December 2022 or 31 December 2021.
14
Tangible fixed assets
Group
Short term leasehold property
Leasehold improvements
Assets under construction
Kitchen equipment
Fixtures and fittings
Total
£
£
£
£
£
£
Cost
At 1 January 2022
442,943
3,191,192
137,587
2,454,474
2,930,339
9,156,535
Additions
-
2,579
14,296
166,129
79,133
262,137
Transfers
-
-
(168,194)
85,779
82,415
-
Exchange adjustments
-
346,660
16,311
128,581
50,936
542,488
At 31 December 2022
442,943
3,540,431
-
2,834,963
3,142,823
9,961,160
Depreciation and impairment
At 1 January 2022
193,111
1,654,531
-
1,908,399
1,853,850
5,609,891
Depreciation charged in the year
22,147
330,301
-
289,832
483,938
1,126,218
Exchange adjustments
-
166,542
-
121,812
31,230
319,584
At 31 December 2022
215,258
2,151,374
-
2,320,043
2,369,018
7,055,693
Carrying amount
At 31 December 2022
227,685
1,389,057
-
514,920
773,805
2,905,467
At 31 December 2021
249,832
1,536,661
137,587
546,075
1,076,489
3,546,644
AZUR LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
14
Tangible fixed assets
(Continued)
- 24 -
Company
Short term leasehold property
Leasehold improvements
Kitchen equipment
Fixtures and fittings
Total
£
£
£
£
£
Cost
At 1 January 2022
442,943
267,019
1,369,851
2,500,686
4,580,499
Additions
-
-
24,729
38,882
63,611
At 31 December 2022
442,943
267,019
1,394,580
2,539,568
4,644,110
Depreciation and impairment
At 1 January 2022
193,111
249,693
880,878
1,590,418
2,914,100
Depreciation charged in the year
22,147
3,058
200,868
394,994
621,067
At 31 December 2022
215,258
252,751
1,081,746
1,985,412
3,535,167
Carrying amount
At 31 December 2022
227,685
14,268
312,834
554,156
1,108,943
At 31 December 2021
249,832
17,326
488,973
910,268
1,666,399
15
Fixed asset investments
Group
Company
2022
2021
2022
2021
Notes
£
£
£
£
Investments in subsidiaries
16
-
-
1,964,057
1,964,057
Movements in fixed asset investments
Company
Shares in group undertakings
£
Cost or valuation
At 1 January 2022 and 31 December 2022
1,964,057
Carrying amount
At 31 December 2022
1,964,057
At 31 December 2021
1,964,057
16
Subsidiaries

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

AZUR LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
16
Subsidiaries
(Continued)
- 25 -
Name of undertaking
Registered office
Class of
% Held
shares held
Direct
Indirect
Azur Management Service, Inc
USA
Ordinary
100.00
-
La Petite Maison Resturants LLC
USA
Ordinary
-
100.00
17
Stocks
Group
Company
2022
2021
2022
2021
£
£
£
£
Finished goods and goods for resale
766,826
606,483
329,065
291,626
18
Debtors
Group
Company
2022
2021
2022
2021
Amounts falling due within one year:
£
£
£
£
Trade debtors
137,547
223,537
4,474
112,407
Corporation tax recoverable
596,893
596,893
596,893
596,893
Amounts owed by group undertakings
438,770
276,422
683,832
637,927
Other debtors
80,602
371,598
78,981
371,598
Prepayments and accrued income
246,005
192,677
188,080
179,808
1,499,817
1,661,127
1,552,260
1,898,633
Amounts falling due after more than one year:
Other debtors
137,761
132,644
94,177
90,600
Deferred tax asset (note 21)
385,332
882,814
385,332
882,814
523,093
1,015,458
479,509
973,414
Total debtors
2,022,910
2,676,585
2,031,769
2,872,047
AZUR LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 26 -
19
Creditors: amounts falling due within one year
Group
Company
2022
2021
2022
2021
£
£
£
£
Trade creditors
570,344
648,178
332,807
516,591
Amounts owed to group undertakings
8,697,491
8,490,640
8,263,818
8,241,235
Other taxation and social security
428,916
63,594
393,713
63,594
Other creditors
118,569
6,343,483
118,569
6,343,483
Accruals and deferred income
1,060,012
1,718,313
421,756
1,078,374
10,875,332
17,264,208
9,530,663
16,243,277
20
Creditors: amounts falling due after more than one year
Group
Company
2022
2021
2022
2021
£
£
£
£
Other creditors
55,081
220,453
-
-
Accruals and deferred income
-
208,877
-
208,877
55,081
429,330
-
208,877
21
Deferred taxation

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

Assets
Assets
2022
2021
Group
£
£
Deferred tax asset
385,332
882,814
Assets
Assets
2022
2021
Company
£
£
Deferred tax asset
385,332
882,814
AZUR LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
21
Deferred taxation
(Continued)
- 27 -
Group
Company
2022
2022
Movements in the year:
£
£
Asset at 1 January 2022
(882,814)
(882,814)
Charge to profit or loss
497,482
497,482
Asset at 31 December 2022
(385,332)
(385,332)

The deferred tax asset set out above is expected to reverse within 12 months and relates to the utilisation of tax losses against future expected profits of the same period.

22
Retirement benefit schemes
2022
2021
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
37,307
36,189

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.

23
Share capital
2022
2021
2022
2021
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
215,054
215,054
215,054
215,054
24
Operating lease commitments

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
1,188,305
1,292,255
472,268
537,158
Between two and five years
2,518,148
3,788,704
1,299,300
1,349,502
In over five years
5,775,814
12,071,570
5,288,275
5,708,875
9,482,267
17,152,529
7,059,843
7,595,535
AZUR LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 28 -
26
Controlling party

On 21 December 2021, La Petite Maison Restaurants Limited became the immediate parent company. The company is registered in Dubai. The registered office address for the immediate parent company is Gate Village 08 DIFC, PO Box 506711, Dubai, United Arab Emirates.

 

On the same date, Trends Limited became the ultimate parent company. The registered office of Trends Limited is Riyadh, King Fahad Road Area, Olaya, King Faisal Foundation Tower.

27
Cash (absorbed by)/generated from group operations
2022
2021
£
£
Profit/(loss) for the year after tax
1,124,080
(4,514,515)
Adjustments for:
Taxation charged/(credited)
532,142
(1,441,008)
Finance costs
-
1,101
Investment income
(2,365)
(88)
Amortisation and impairment of intangible assets
43,973
1,054
Depreciation and impairment of tangible fixed assets
937,371
758,386
Amounts written off investments
-
(1,121,127)
Movements in working capital:
(Increase)/decrease in stocks
(112,504)
10,769
Decrease/(increase) in debtors
238,302
(584,353)
(Decrease)/increase in creditors
(6,820,419)
14,918,792
Cash (absorbed by)/generated from operations
(4,059,420)
8,029,011
28
Analysis of changes in net funds - group
1 January 2022
Cash flows
Other non-cash changes
Exchange rate movements
31 December 2022
£
£
£
£
£
Cash at bank and in hand
8,048,271
(4,331,796)
-
(101,957)
3,614,518
Obligations under finance leases
-
2,332
(2,332)
-
-
8,048,271
(4,329,464)
(2,332)
(101,957)
3,614,518
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