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Registered number: 12254114










OAKMAN GROUP PLC










ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE PERIOD ENDED 2 JULY 2023

 
OAKMAN GROUP PLC
 
 
COMPANY INFORMATION


Directors
Jane Elizabeth Bentall 
Peter James Borg Neal 
Dermot Francis King 
John Stewart Leslie 
David Mark Sherratt 




Registered number
12254114



Registered office
Saxon House, 211 High Street

Berkhamsted

Hertfordshire

HP4 1AD




Independent auditors
Haysmacintyre LLP

10 Queen Street Place

London

EC4R 1AG





 
OAKMAN GROUP PLC
 

CONTENTS



Page
Group Strategic Report
1 - 6
Directors' Report
7 - 10
Independent Auditors' Report
11 - 14
Consolidated Statement of Comprehensive Income
15
Consolidated Statement of Financial Position
16 - 17
Company Statement of Financial Position
18
Consolidated Statement of Changes in Equity
19
Company Statement of Changes in Equity
20
Consolidated Statement of Cash Flows
21 - 22
Consolidated Analysis of Net Debt
23
Notes to the Financial Statements
24 - 46


 
OAKMAN GROUP PLC
 
 
GROUP STRATEGIC REPORT
FOR THE PERIOD ENDED 2 JULY 2023

Introduction
 
The Directors present their report and the financial statements for the 52 weeks ended 2 July 2023.

Business review
 
The impact of post-Covid 19 cast a long shadow over the economic trading environment. Rampant inflationary pressures driving household utility bills and food prices caused the Bank of England to react with aggressive interest rate hikes. Although energy prices in themselves were more connected to the ongoing Russian invasion of Ukraine, the impact on consumer spending was noticeable.
The Government also introduced inflation-busting unprecedented increases in National Minimum Wage rates. Although in itself this isn’t a driver to our cost base, the impact is felt through maintaining differential rates, which the business had to absorb as customer budgets were squeezed. 
The uncertain backdrop could be measured by having no less than four Chancellors of the Exchequer in the space of the 52 weeks under review. At a time when the hospitality industry was suffering generally from a shortage of workers, it was a very challenging year.
Given the challenges and pressures outside of our control, the business did well to stand still although we grew the estate to 43 properties, which includes a mixture of large freehold (10), leasehold (23) and managed sites (10).
The business focused on creating an environment to retain our best talent, paying as much as we could afford, rather than as little as we could get away with. Of particular concern was the employment landscape for kitchen workers and chefs generally. The training and development of our kitchen teams was a key part of this strategy and has provided us with the employee resources to continue our growth.
During the year, the business opened two more sites. The Beech House in Watford was a development of a previously unused building on the exterior of the shopping centre, while The Navigation Inn in Lapworth is an existing pub that has been brought into the estate. We plan to invest into this site to bring it up to the Oakman standard.
Despite the continuation of outside factors impacting our ability to trade, the Company produced Turnover of £57.8m with adjusted EBITDA of £1.8 profit. The Balance Sheet shows Net Assets of £6m.

Other Financial and Non-financial Key Performance Indicators  (pre Covid-19 coronavirus pandemic)
 
• During the year, sales performance was up 5.9% from the prior year, but behind the market.
• Average net sales per week were at £1,112k during the period compared to £1,047k the prior year.
• Wet Margins marginally improved by 0.2% compared to the previous year.
• Dry Margins dropped by some 1.7% compared to the previous year.
• Staff turnover for the period was 67%.
•During the year we opened the following sites:
• The Beech House, Watford
• The Navigation Inn, Lapworth

Page 1

 
OAKMAN GROUP PLC
 

GROUP STRATEGIC REPORT (CONTINUED)
FOR THE PERIOD ENDED 2 JULY 2023

Future Developments
 
Looking forward, Oakman Group is well placed to compete for market share and aims to deliver
further success by:
1. Focusing the business on the growth in the premium eating-out market and boutique accommodation
offer.
2. Evolving our concept to maintain high levels of customer affinity and relevance.
3. Generating high returns on investment through scale advantages.
4. Extending the skill base of our people to drive team retention, with consumer focus and operational
excellence.
5. Reducing the levels and cost of our funding structure.
6. Continuing to build a sound financial base with a cautious approach to debt and a flexible approach to
property ownership.
We believe we have the management skills, operational concepts and ambition to grow the business. The Board
are committed to growing ultimate shareholder value whilst carefully managing the risks in so doing.
The Group has a pipeline of 3 development sites in various stages of securing relevant planning permission.
Restructure: 
On 3rd June 2023, the Group completed a reorganisation of the corporate Group structure, reducing the number of trading entities from 12 companies to 5. The elimination of 7 entities was designed to remove subsidiaries that added no value to the Group other than their trading assets which were transferred to retained Group entities to create a more efficient Group structure. All transfers were intra-group and no assets left the group. The assets and liabilities of the eliminated entities were transferred as follows:
Eliminated entity                                       Transferee Entity
Beech Hut Limited                                    Oakman Dev Limited
Oakman Properties Limited                        Oakman (P&E) Limited
Oakman Bedfordshire Holdings Limited       Oakman (P&E) Limited
Downoak Limited                                       Oakman (P&E) Limited
Hedderwick Limited                                   Oakman (P&E) Limited
Oakman Ventures Limited                          Oakman Inns and Restaurants Limited 
Hunky Dory Pubs Limited                           Oakman Inns and Restaurants Limited

Page 2

 
OAKMAN GROUP PLC
 

GROUP STRATEGIC REPORT (CONTINUED)
FOR THE PERIOD ENDED 2 JULY 2023

Employees
 
Oakman Group PLC is committed to eliminating discrimination and encouraging diversity amongst our workforce. Our aim is that each employee feels respected and is valued based upon their skills, performance and commitment.
Oakman Group PLC is an equal opportunities employer. It is committed to providing equal opportunities including the recruitment, training and promotion of workers, and to eliminating discrimination in the workplace whether on grounds of age, gender, marital status or sexual orientation, race, national or ethnic origin, religious orientation or beliefs or disability. All job applicants and workers are treated equally and the Company is willing to make reasonable adjustments where appropriate for disabled applicants and workers.
Each employee has an obligation to promote an equal opportunity environment within the Company.
Oakman employees also have a duty to observe and apply this policy at all times. Violation of this policy is a serious offence and could result in disciplinary action and/or summary dismissal.
Engagement with employees
The Company works hard on maintaining strong engagement with our employees has this has never been more critical, especially in a tightening labour market. 
Team welfare was a high priority and we issued regular team surveys and held staff representative meetings to ensure we were in touch with our team and their needs and were able to respond accordingly.
Our team’s personal wellbeing and mental health has been at the forefront of our plans and we have used many of the services provided by Hospitality Action to support our teams during this time.
Corporate Social Responsibility
The directors firmly believe that social responsibility is an integral part of the wealth creation process. This in turn enhances the competitiveness of Oakman as well as improving the wellbeing of our team, the local communities which we serve in and our broader stakeholders.
The Oakman leadership team have consistently paved the way forward for the broader industry by
demonstrating that a long term balanced approach centred around people, planet and profits is the key to building a successful and sustainable business.
Each Oakman Inn raises money for and engages with specific local charities which are chosen at the discretion of the local team.
From a corporate perspective, Oakman has provided significant support for a range of national and industry charities including: The Epilepsy Society, Woodland Trust, Hospitality Action, the Tim Bacon Foundation and many more. Oakman Group PLC engaged with Tree Nation and planted a tree for every hot drink that was purchased and to date have planted over 1.27 million trees to significantly offset our carbon footprint.
Oakman Group PLC has a proud record of establishing best practice in terms of sustainability policies across the wider pub industry.

Page 3

 
OAKMAN GROUP PLC
 

GROUP STRATEGIC REPORT (CONTINUED)
FOR THE PERIOD ENDED 2 JULY 2023

Greenhouse gas emissions and energy consumption

The Group's greenhouse gas emissions and energy consumption are as follows: 

2 July
3 July
2023
2022
kWh
kWh
Grid Electricity

8,667,977

7,936,749
 
Main Gas

6,580,524

5,080,260
 
LPG

322,738

371,835
 
Company Fuel (Diesel)

747,200

22,397
 
Company Fuel (Petrol)

475

19,108
 
Reimbursed Fuel

43,583

220,106
 
Propane

200,913

860,869
 

16,563,410

14,511,324
 

Scope 1 emissions in metric tonnes CO2e
Natural Gas, LPG and Fleet Vehicles - 2,009 (2022 - 1,324)
Scope 2 emissions in metric tonnes CO2e
Purchased electricity - 987 (2022 - 1,535) 
Scope 3 emissions in metric tonnes CO2e
Electricity T&D and Reimbursed Fuel - 14,001 (2022 - 195)
Total gross emissions in metric tonnes - 16,977  (2022 - 3,053) CO2e   
Intensity ratio - 247 (2022 -  50) tCO2e/£m                                                                                                             
Quantification and reporting methodology
We have followed 2019 HM Government environmental reporting guidelines to ensure compliance with the SECR requirements. The DEFRA issued “Greenhouse gas reporting: conversion factors 2023” conversion figures for CO2e were used along with the fuel property figures to determine the kWh content for Fleet. 
Intensity measurement
The chosen intensity measurement ratio is total gross emissions in tonnes CO2e per £m Turnover for the financial period.
Measures taken to improve energy efficiency
Oakman Group Plc continues to strive for energy and carbon reduction arising from their activities, all sites conducted a full check on all equipment when in lockdown to ensure usage was kept to a minimum.
Materiality
Oakman Group Plc has, to the best of its knowledge, included 100% of all energy sources within this report. 

Page 4

 
OAKMAN GROUP PLC
 

GROUP STRATEGIC REPORT (CONTINUED)
FOR THE PERIOD ENDED 2 JULY 2023

Section 172 Statement

The Directors are aware of their duty under Section 172 of the Companies Act 2006, to act in a way which they consider, in good faith, would be most likely to promote the success of the company for the benefit of its members as a whole and in doing so, have regard (amongst other matters) to: 
• the likely consequences of any decision in the long term
• the interests of the company’s employees
• the need to foster the company’s business relationships with suppliers, customers and others
• the impact of the company’s operations on the community and the environment
• the desirability of the company maintaining a reputation for high standards of business conduct 
• the need to act fairly as between members.
Below is how we focus and promote these areas:
Long term impact – 
• The Directors regularly update their stakeholders on the balanced scorecard KPI measures and seek debate, challenge and approval from the Board and Non Executive directors.
Employees – 
• We gain insight on our employee engagement through effective feedback via team surveys and quarterly team representative meetings, award winning training and development programmes for all levels, apprenticeship schemes, career planning frameworks, fast track leadership development for future general managers, recognition programmes for team members who demonstrate our values and our annual “thank you” festival, Oakfest
• We achieved the Princess Royal Training Award in 2023 in recognition of the scope, standard and quality of our training.   
• We offer a comprehensive benefit package by role to support high performance.
• We put team retention at the heart of all decision making
• We participate in the Mind Employers Charter and practice pro active initiatives to promote team well being
• We support the JEDI (Justice, Equality, Diversity and Inclusion) principles in providing training and support to all employees
Customers - 
• Building trust with our customers at every stage of the customer journey and ensuring our customers are at the heart of all process such as deposits, cancellations, no shows, refunds, complaints, feedback, free celebratory gifts
• Providing a premium dining and boutique accommodation experience consistently
• Introducing technology to improve the customer journey
• Responding to customer feedback including via social media channels
Suppliers - 
• Long term partnerships with suppliers and landlords have been built over the last fourteen years
• We maintain regular conversations with suppliers to agree payment plans which work for both parties
• We build long term partnerships with suppliers focused on quality, provenance and sustainability that are constantly reviewed
Community & Environment - 
• As our businesses are rooted in local communities, we operate our licences responsibly
• Working with the charity Tree Nation to help offset our carbon emissions having now planted over 1.27 million trees
• Each site raises funds for their designated local charities
• We recruit our teams mainly from within their local community supporting the local economy
• We focus on environmentally friendly operating procedures such as reduction in single use plastic and a focus on reducing energy consumption and energy efficiency improvements
 
Page 5

 
OAKMAN GROUP PLC
 

GROUP STRATEGIC REPORT (CONTINUED)
FOR THE PERIOD ENDED 2 JULY 2023

We have commenced our B Corp accreditation journey 

Section 172 Statement (continued)

High Standards - 
• We employ a balanced scorecard approach to evaluating the quality and consistency of our premium offering
• We source our food products from British and Irish farms
• We ensure quality processes and controls for all areas of the operation
• We use external benchmarking
Acting Fairly between stakeholders - 
• Stakeholder engagement relevant for each stakeholder group
• Regular communication and business updates with all stakeholders

Principal risks and uncertainties

The principal risks facing the business are:
Funding – the size and type of debt exposes the business to short term fluctuations in the financial market conditions. Although cashflow and other information is constantly monitored, re engineering the Company's funding structure is a primary focus of the board.
Employment landscape – as a service business, access to sufficient labour is critical. Post Brexit due to the impact of Covid 19, the labour market has contracted. The business is facing this challenge by creating and developing a strategy that attracts, develops and retains the best talent in our market, including but not limited to the development of our Chef Academy.
Inflation – like all retail businesses, consumer confidence can impact discretionary spending decisions by families. High energy prices on households that drive inflation that impact day to day prices risks damaging that confidence.
Food safety – the business retains the highest standards of food safety and  places this agenda item at the top of every regular management review meeting.
Data security – the Board has implemented sufficient defences in the Company’s IT networks to prevent criminal attacks. A sustained attack, if successful, would disrupt our ability to trade using payment cards.


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



Dermot Francis King
Director

Date: 31 January 2024

Page 6

 
OAKMAN GROUP PLC
 
 
 
DIRECTORS' REPORT
FOR THE PERIOD ENDED 2 JULY 2023

The Directors present their report and the financial statements for the period ended 2 July 2023.

Directors' responsibilities statement

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

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


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

make judgements and accounting estimates that are reasonable and prudent;

state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;

prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group will continue in business.

The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and the Group and to enable them to ensure that the financial statements comply with the Companies Act 2006They are also responsible for safeguarding the assets of the Company and the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Results and dividends

The loss for the period, after taxation, amounted to £6,174,006 (2022 - loss £3,268,491).

The Directors do not recommend payment of a dividend (2022 - no dividend). 

Page 7

 
OAKMAN GROUP PLC
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE PERIOD ENDED 2 JULY 2023


Directors

The Directors who served during the period were:

Jane Elizabeth Bentall 
Peter James Borg Neal 
Dermot Francis King 
John Stewart Leslie 
David Mark Sherratt 

Disclosure of information to auditors

Each of the persons who are Directors at the time when this Directors' Report is approved has confirmed that:
 
so far as the Director is aware, there is no relevant audit information of which the Company and the Group's auditors are unaware, and

the Director has taken all the steps that ought to have been taken as a Director in order to be aware of any relevant audit information and to establish that the Company and the Group's auditors are aware of that information.

Page 8

 
OAKMAN GROUP PLC
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE PERIOD ENDED 2 JULY 2023

Post balance sheet events

Refinancing
The Company completed the refinance of the following secured loans:
In January 2024, Santander extended the maturity dates for the Growth Capital Loan Facility and Coronavirus Business Interruption Loan to January 2025.
In January 2024, Haywood agreed to extend the maturity date for the Loan Facility to October 2025.
In January 2024, W E Black agreed to extend the maturity dates for their Loan Facilities by 12 months into 2025.

Trading
At the end of July 2023, following the completion of our development works, we opened our new site The Journeyman in the affluent Buckinghamshire town of Gerrards Cross.
At the end of August 2023, we opened another new site, again following a significant investment into an old building. The George Inn is a significant site in the centre of the historic town of Ludlow, just a stone’s throw from 11th century Ludlow Castle.
Restructure
On 3rd June 2023, the Group completed a reorganisation of the corporate Group structure, reducing the number of trading entities from 12 companies to 5. The elimination of 7 entities was designed to remove subsidiaries that added no value to the Group other than their trading assets which were transferred to retained Group entities to create a more efficient Group structure. All transfers were intra-group and no assets left the group. The assets and liabilities of the eliminated entities were transferred as follows:
Eliminated entity                                       Transferee Entity
Beech Hut Limited                                    Oakman Dev Limited
Oakman Properties Limited                        Oakman (P&E) Limited
Oakman Bedfordshire Holdings Limited       Oakman (P&E) Limited
Downoak Limited                                       Oakman (P&E) Limited
Hedderwick Limited                                   Oakman (P&E) Limited
Oakman Ventures Limited                          Oakman Inns and Restaurants Limited 
Hunky Dory Pubs Limited                           Oakman Inns and Restaurants Limited
Going concern
The Directors have adopted the going concern basis in preparing these financial statements after careful assessment of identified principal risks and in particular, the possible adverse impact on the financial performance, specifically on revenue and cash flows of the cost-of-living crisis currently impacting the UK economy. The cost-of-living crisis is the result of a number of events including the aftermath of Brexit, Covid and the war in Ukraine that has resulted in sharp increases in energy and certain food prices and in turn led to high inflation and a rise in interest rates. This backdrop has impacted the consumers propensity to spend on eating out and seen increases in the cost of food, energy and labour all of which are integral to the Group's business offering.
 
The Directors believe that because the Group's business outlets are mostly situated in suburban affluent areas, its customers’ propensity to spend on eating-out is not impacted as severely as the general UK consumer. Also, the commodity element of the Group's energy contracts were fixed until October 2024 just prior to the war in Ukraine. Increases in food costs have been somewhat mitigated through menu changes and moving supply routes all of which provides some protection to the economic threats imposed by the cost-of-living crisis. The Directors are encouraged by the fact that wholesale energy prices are now lower than their pre-war levels and
Page 9

 
OAKMAN GROUP PLC
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE PERIOD ENDED 2 JULY 2023

that the Bank of England economic forecasts inflation to fall further in 2024. Nevertheless, the directors expect the trading environment to remain challenging throughout 2023 and in to the first half of 2024.
 
As part of the going concern assessment the directors have considered the debt held by the Group and the ability to service interest and capital repayments. Post year end, the Santander loan has been refinanced with repayment now due 31 January 2025, and alongside this repayment of the shareholder loans and accrued interest that are subordinated to this debt was deferred. The forecasts assume that a CBIL overdraft provided by Santander, which although is  repayable on demand, will not be called in prior to 31 January 2025.
 
The forecasts indicate that, as would be expected given the sharp rise in interest rates over a relatively short period, the interest cover covenant on the Cynergy bank loan is at risk of being breached. The Directors recognise that a waiver may be required should this arise, but given that Cynergy have stated their continued support for the business, they are confident of such a waiver being granted.
 
Despite the Director’s confidence in the forecasts, it’s strong asset backing and the level of support shown by the Group’s lenders, there is an assumption that the CBIL facility, which while technically repayable on demand, will not be recalled and that the Group will continue to receive the support of Cynergy Bank.  Were these assumptions to be incorrect, it is recognised that there is material uncertainty which may cast significant doubt surrounding the Group’s ability to continue as a going concern.    

Auditors

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

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





Dermot Francis King
Director

Date: 31 January 2024

Page 10

 
OAKMAN GROUP PLC
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF OAKMAN GROUP PLC
 

Opinion


We have audited the financial statements of Oakman Group Plc (the 'parent Company') and its subsidiaries (the 'Group') for the period ended 2 July 2023, which comprise the Consolidated Statement of Comprehensive Income, the Consolidated Statement of Financial Position, the Company Statement of Financial Position, the Consolidated Statement of Cash Flows, the Consolidated Statement of Changes in Equity, the Company Statement of Changes in Equity and the related notes, including a summary of significant accounting policiesThe financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).


In our opinion the financial statements:


give a true and fair view of the state of the Group's and of the parent Company's affairs as at 2 July 2023 and of the Group's loss for the period then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.


Basis for opinion


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


Material uncertainty related to going concern


We draw attention to note 2.3 in the financial statements, which indicates that the Group has an overdraft repayable on demand and there is uncertainty over the future financing. As stated in note 2.3, these events or conditions, along with the other matters as set forth in note 2.3, indicate that a material uncertainty exists that may cast significant doubt on the Group's ability to continue as a going concern. Our opinion is not modified in respect of this matter.


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.


Our responsibilities and the responsibilities of the Directors with respect to going concern are described in the relevant sections of this report.


Page 11

 
OAKMAN GROUP PLC
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF OAKMAN GROUP PLC (CONTINUED)


Other information


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


We have nothing to report in this regard.


Opinion on other matters prescribed by the Companies Act 2006
 

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


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


Matters on which we are required to report by exception
 

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


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


adequate accounting records have not been kept by the parent Company, or returns adequate for our audit have not been received from branches not visited by us; or
the parent Company financial statements are not in agreement with the accounting records and returns; or
certain disclosures of Directors' remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.


Responsibilities of Directors
 

As explained more fully in the Directors' Responsibilities Statement set out on page 7, 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.


Page 12

 
OAKMAN GROUP PLC
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF OAKMAN GROUP PLC (CONTINUED)


Auditors' responsibilities for the audit of the financial statements
 

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


Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:
We consider the most significant laws and regulations that have a direct impact on the financial statements to be:
- FRS102 and Companies Act 2006 compliance: We reviewed of the financial statement disclosures and perform
testing on balances and disclosures.
- Tax regulation: We inspected correspondence with regulators and tax authorities, and reviewed the companies tax computations;
We consider the most significant laws and regulations that have an indirect impact on the financial statements
are:
- Food safety and hygiene: We discussed with management to identify whether they were aware of instances of non-compliance, we reviewed board minutes, we searched for a sample of sites on the FSA website to identify  any instances of poor ratings or breaches. 
We considered the following areas to be those where the financial statements are most susceptible to fraud:
- Management override of controls: We evaluated management’s controls designed to prevent and detect
irregularities and we sampled and tested journals, in particular journal entries posted with unusual account
combinations, postings by unusual users or with unusual descriptions, and we challenged assumptions and
judgements made by management in their critical accounting estimates.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.


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


Page 13

 
OAKMAN GROUP PLC
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF OAKMAN GROUP PLC (CONTINUED)


Use of our report
 

This report is made solely to the Company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in an Auditors' Report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company's members, as a body, for our audit work, for this report, or for the opinions we have formed.





Andrew Ball (Senior Statutory Auditor)
for and on behalf of
Haysmacintyre LLP
Statutory Auditors
10 Queen Street Place
London
EC4R 1AG

31 January 2024
Page 14

 
OAKMAN GROUP PLC
 
 
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE PERIOD ENDED 2 JULY 2023

2023
2022
Note
£
£

  

Turnover
 4 
57,808,192
54,418,788

Cost of sales
  
(39,893,251)
(36,835,348)

Gross profit
  
17,914,941
17,583,440

Administrative expenses
  
(17,766,718)
(12,709,719)

Other operating income
 5 
293,034
497,021

Exceptional administrative expenses
  
1,375,487
(1,343,299)

EBITDA
 6 
1,816,744
4,027,443

Depreciation and amortisation
  
(2,989,052)
(2,600,622)

Total operating (loss)/profit
  
(1,172,308)
1,426,821

Interest payable and similar expenses
 10 
(5,001,698)
(4,695,312)

Loss before taxation
  
(6,174,006)
(3,268,491)

Loss for the financial period
  
(6,174,006)
(3,268,491)

(Loss) for the period attributable to:
  

Owners of the parent Company
  
(6,174,006)
(3,268,491)

  
(6,174,006)
(3,268,491)

There was no other comprehensive income for 2023 (2022:£NIL).

The notes on pages 24 to 46 form part of these financial statements.

Page 15

 
OAKMAN GROUP PLC
REGISTERED NUMBER: 12254114

CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 2 JULY 2023

2 July
3 July
2023
2022
Note
£
£

Fixed assets
  

Intangible assets
 14 
107,940
104,891

Tangible assets
 15 
74,903,011
68,238,488

  
75,010,951
68,343,379

Current assets
  

Stocks
 17 
804,735
543,348

Debtors: amounts falling due within one year
 18 
3,908,412
6,299,310

Cash at bank and in hand
 19 
326,251
3,163,241

  
5,039,398
10,005,899

Creditors: amounts falling due within one year
 20 
(43,364,743)
(38,005,541)

Net current liabilities
  
 
 
(38,325,345)
 
 
(27,999,642)

Total assets less current liabilities
  
36,685,606
40,343,737

Creditors: amounts falling due after more than one year
 21 
(30,643,070)
(33,646,735)

  

Net assets
  
6,042,536
6,697,002


Capital and reserves
  

Called up share capital 
 23 
2,698,670
2,138,698

Share premium account
 24 
14,064,620
9,105,052

Preference shares
 24 
144,214
144,214

Other reserves
 24 
1,226,357
1,226,357

Merger reserve
 24 
(6,656,594)
(6,656,594)

Profit and loss account
 24 
(5,434,731)
739,275

  
6,042,536
6,697,002


Page 16

 
OAKMAN GROUP PLC
REGISTERED NUMBER: 12254114
    
CONSOLIDATED STATEMENT OF FINANCIAL POSITION (CONTINUED)
AS AT 2 JULY 2023

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




Dermot Francis King
Director

Date: 31 January 2024

The notes on pages 24 to 46 form part of these financial statements.

Page 17

 
OAKMAN GROUP PLC
REGISTERED NUMBER: 12254114

COMPANY STATEMENT OF FINANCIAL POSITION
AS AT 2 JULY 2023

2 July
3 July
2023
2022
Note
£
£

Fixed assets
  

Investments
 16 
28,527,892
28,527,892

  
28,527,892
28,527,892

Current assets
  

Debtors: amounts falling due within one year
 18 
29,135,662
23,726,454

Cash at bank and in hand
 19 
1,224
7,840

  
29,136,886
23,734,294

Creditors: amounts falling due within one year
 20 
(17,256)
(114,724)

Net current assets
  
 
 
29,119,630
 
 
23,619,570

Total assets less current liabilities
  
57,647,522
52,147,462

Net assets
  
57,647,522
52,147,462


Capital and reserves
  

Called up share capital 
 23 
2,698,668
2,138,698

Share premium account
 24 
14,064,623
9,105,055

Preference shares
 24 
144,214
144,214

Profit and loss account
 24 
40,740,017
40,759,495

  
57,647,522
52,147,462


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




Dermot Francis King
Director

Date: 31 January 2024

The notes on pages 24 to 46 form part of these financial statements.

Page 18

 

 
OAKMAN GROUP PLC


 

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 2 JULY 2023



Called up share capital
Share premium account
Preference shares
Other reserves
Merger reserve
Profit and loss account
Total equity


£
£
£
£
£
£
£



At 4 July 2021
1,766,372
40,636,907
129,211
1,226,357
(6,656,594)
(36,731,685)
370,568





Loss for the period
-
-
-
-
-
(3,268,491)
(3,268,491)


Purchase of own shares
-
-
-
-
-
40,739,451
40,739,451


Shares issued during the period
372,326
9,207,596
-
-
-
-
9,579,922


Shares redeemed during the period
-
(40,739,451)
-
-
-
-
(40,739,451)


Shares issued during the period
-
-
15,003
-
-
-
15,003





At 3 July 2022
2,138,698
9,105,052
144,214
1,226,357
(6,656,594)
739,275
6,697,002





Loss for the period
-
-
-
-
-
(6,174,006)
(6,174,006)


Shares issued during the period
559,972
4,959,568
-
-
-
-
5,519,540



At 2 July 2023
2,698,670
14,064,620
144,214
1,226,357
(6,656,594)
(5,434,731)
6,042,536



The notes on pages 24 to 46 form part of these financial statements.

Page 19

 
OAKMAN GROUP PLC
 

COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 2 JULY 2023


Called up share capital
Share premium account
Preference shares
Profit and loss account
Total equity

£
£
£
£
£


At 4 July 2021
1,766,372
40,636,910
129,211
36,681
42,569,174



Loss for the period
-
-
-
(16,637)
(16,637)

Purchase of own shares
-
-
-
40,739,451
40,739,451

Shares issued during the period
372,326
9,207,596
-
-
9,579,922

Shares redeemed during the period
-
(40,739,451)
-
-
(40,739,451)

Shares issued during the year
-
-
15,003
-
15,003



At 3 July 2022
2,138,698
9,105,055
144,214
40,759,495
52,147,462



Loss for the period
-
-
-
(19,478)
(19,478)

Shares issued during the period
559,970
4,959,568
-
-
5,519,538


At 2 July 2023
2,698,668
14,064,623
144,214
40,740,017
57,647,522


Page 20

 
OAKMAN GROUP PLC
 

CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE PERIOD ENDED 2 JULY 2023

2 July
3 July
2023
2022
£
£

Cash flows from operating activities

Loss for the financial period
(6,174,006)
(3,268,491)

Adjustments for:

Amortisation of intangible assets
51,199
56,471

Depreciation of tangible assets
3,147,212
2,544,151

Net impairment of fixed assets
(2,375,732)
234,000

Loss on disposal of tangible assets
4,580
-

Interest payable and similar charges
4,666,931
4,695,312

(Increase) in stocks
(261,387)
(97,032)

Decrease/(increase) in debtors
2,390,898
(2,820,712)

Increase in creditors
1,876,895
1,828,492

Net cash generated from operating activities

3,326,590
3,172,191


Cash flows from investing activities

Purchase of intangible fixed assets
(54,248)
(67,444)

Purchase of tangible fixed assets
(7,440,583)
(9,812,947)

Net cash from investing activities

(7,494,831)
(9,880,391)

Cash flows from financing activities

Issue of ordinary shares
5,519,540
6,458,422

Net increase in bank loan
835,618
17,430,468

Net repayment of shareholders' loans
-
(15,934,122)
Page 21

 
OAKMAN GROUP PLC
 

CONSOLIDATED STATEMENT OF CASH FLOWS (CONTINUED)
FOR THE PERIOD ENDED 2 JULY 2023

2 July
3 July

2023
2022

£
£



Repayment of debenture loans
(2,999,232)
-

Interest paid
(2,024,675)
(2,598,521)

Net cash used in financing activities
1,331,251
5,356,247

Net (decrease) in cash and cash equivalents
(2,836,990)
(1,351,953)

Cash and cash equivalents at beginning of period
3,163,241
4,515,194

Cash and cash equivalents at the end of period
326,251
3,163,241


Cash and cash equivalents at the end of period comprise:

Cash at bank and in hand
326,251
3,163,241

326,251
3,163,241


The notes on pages 24 to 46 form part of these financial statements.

Page 22

 
OAKMAN GROUP PLC
 

CONSOLIDATED ANALYSIS OF NET DEBT
FOR THE PERIOD ENDED 2 JULY 2023





At 4 July 2022
Cash flows
Non-cashflow
At 2 July 2023
£

£

£

£

Cash at bank and in hand

3,163,241

(2,836,990)

-

326,251

Bank loans due within 1 year

(7,977,318)

(847,618)

(189,973)

(9,014,909)

Bank loans due after 1 year

(29,445,043)

-

189,973

(29,255,070)

Shareholder loans due within 1 year

(11,598,411)

3,524,599

-

(8,073,812)

Shareholder loans due after 1 year

(1,400,000)

-

-

(1,400,000)

Other loans due within 1 year

-

(525,367)

(2,801,692)

(3,327,059)

Other loans due after 1 year

(2,801,692)

-

2,801,692

-


(50,059,223)
(685,376)
-
(50,744,599)

The notes on pages 24 to 46 form part of these financial statements.

Page 23

 
OAKMAN GROUP PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 2 JULY 2023

1.


General information

Oakman Group Plc is a company limited by shares, incorporated in England and Wales where it is also registered. The Group specialises in the running of premium pubs, with or without letting rooms. The registered office of the company is Saxon House, 211 High Street, Berkhamsted, Hertfordshire, United Kingdom, HP4 1AD.

2.Accounting policies

 
2.1

Basis of preparation of financial statements

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

The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires Group management to exercise judgement in applying the Group's accounting policies (see note 3).

The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of Comprehensive Income in these financial statements.

The following principal accounting policies have been applied:

 
2.2

Basis of consolidation

The introduction of a new holding company, Oakman Group Plc, constitutes a Group reconstruction and has been accounted for using merger accounting principles. Therefore, although the Group reconstruction did not become effective until 2 June 2020, the consolidated financial statements are presented as if Oakman Group Plc and Oakman Inns and Restaurants Limited, the parent company prior to the Group reconstruction, has always been part of the same Group. Accordingly, the results of the Group for the entire comparative period are shown in the Consolidated Statement of Comprehensive Income.

The consolidated financial statements present the results of the Company and its own subsidiaries ("the Group") as if they form a single entity. Intercompany transactions and balances between group companies are therefore eliminated in full.
The consolidated financial statements incorporate the results of business combinations using the purchase method. In the Statement of Financial Position, the acquiree's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquired operations are included in the Consolidated Statement of Comprehensive Income from the date on which control is obtained. They are deconsolidated from the date control ceases.

Page 24

 
OAKMAN GROUP PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 2 JULY 2023

2.Accounting policies (continued)

 
2.3

Going concern

The Directors have adopted the going concern basis in preparing these financial statements after careful assessment of identified principal risks and in particular, the possible adverse impact on the financial performance, specifically on revenue and cash flows of the cost-of-living crisis currently impacting the UK economy. The cost-of-living crisis is the result of a number of events including the aftermath of Brexit, Covid and the war in Ukraine that has resulted in sharp increases in energy and certain food prices and in turn led to high inflation and a rise in interest rates. This backdrop has impacted the consumers propensity to spend on eating out and seen increases in the cost of food, energy and labour all of which are integral to the Group's business offering.
 
The Directors believe that because the Group's business outlets are mostly situated in suburban affluent areas, its customers’ propensity to spend on eating-out is not impacted as severely as the general UK consumer. Also, the commodity element of the Group's energy contracts were fixed until October 2024 just prior to the war in Ukraine. Increases in food costs have been somewhat mitigated through menu changes and moving supply routes all of which provides some protection to the economic threats imposed by the cost-of-living crisis. The Directors are encouraged by the fact that wholesale energy prices are now lower than their pre-war levels and that the Bank of England economic forecasts inflation to fall further in 2024. Nevertheless, the directors expect the trading environment to remain challenging throughout 2023 and in to the first half of 2024.
 
As part of the going concern assessment the directors have considered the debt held by the Group and the ability to service interest and capital repayments. Post year end, the Santander loan has been refinanced with repayment now due 31 January 2025, and alongside this repayment of the shareholder loans and accrued interest that are subordinated to this debt was deferred. The forecasts assume that a CBIL overdraft provided by Santander, which although is  repayable on demand, will not be called in prior to 31 January 2025.
 
The forecasts indicate that, as would be expected given the sharp rise in interest rates over a relatively short period, the interest cover covenant on the Cynergy bank loan is at risk of being breached. The Directors recognise that a waiver may be required should this arise, but given that Cynergy have stated their continued support for the business, they are confident of such a waiver being granted.
 
Despite the Director’s confidence in the forecasts, it’s strong asset backing and the level of support shown by the Group’s lenders, there is an assumption that the CBIL facility, which while technically repayable on demand, will not be recalled and that the Group will continue to receive the support of Cynergy Bank.  Were these assumptions to be incorrect, it is recognised that there is material uncertainty which may cast significant doubt surrounding the Group’s ability to continue as a going concern.  

 
2.4

Revenue

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the
Company and the revenue can be reliably measured. Revenue is measured as the fair value of the
consideration received or receivable for the sale of food and beverage items, as well as room sales in
certain pubs, excluding value added tax and other sales taxes.

Page 25

 
OAKMAN GROUP PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 2 JULY 2023

2.Accounting policies (continued)

 
2.5

Operating leases: the Group as lessee

Rentals paid under operating leases are charged to profit or loss on a straight-line basis over the lease term.

Benefits received and receivable as an incentive to sign an operating lease are recognised on a straight-line basis over the lease term, unless another systematic basis is representative of the time pattern of the lessee's benefit from the use of the leased asset.

 
2.6

Government grants

Grants are accounted under the accruals model as permitted by FRS 102. Grants relating to expenditure on tangible fixed assets are credited to profit or loss at the same rate as the depreciation on the assets to which the grant relates. The deferred element of grants is included in creditors as deferred income.
Grants of a revenue nature are recognised in the Consolidated Statement of Comprehensive Income in the same period as the related expenditure.

 
2.7

Interest income

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

 
2.8

Finance costs

Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.

 
2.9

Borrowing costs

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

 
2.10

Pensions

Defined contribution pension plan

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 payment obligations.

The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Statement of Financial Position. The assets of the plan are held separately from the Group in independently administered funds.

 
2.11

Exceptional items

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

Page 26

 
OAKMAN GROUP PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 2 JULY 2023

2.Accounting policies (continued)

 
2.12

Intangible assets

Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.

At each reporting date the company assesses whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined which is the higher of its fair value less costs to sell and its value in use. An impairment loss is recognised where the carrying amount exceeds the recoverable amount.

All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.

 
2.13

Tangible fixed assets

Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.

Depreciation is provided on the following basis:

Freehold property
-
50 years (100% residual value)
Leasehold property
-
Over the life of the lease
Plant and machinery
-
12.5% straight line
Fixtures and fittings
-
10% straight line
Office equipment
-
33% straight line
Other fixed assets
-
33% straight line

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

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

 
2.14

Impairment of fixed assets and goodwill

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

Page 27

 
OAKMAN GROUP PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 2 JULY 2023

2.Accounting policies (continued)

 
2.15

Valuation of investments

Investments in subsidiaries are measured at cost less accumulated impairment.

 
2.16

Stocks

Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a weighted average basis. Work in progress and finished goods include labour and attributable overheads.

At each reporting date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in profit or loss.

 
2.17

Debtors

Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.

 
2.18

Cash and cash equivalents

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.

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

 
2.19

Creditors

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

  
2.20

Provisions for liabilities

Provisions are made where an event has taken place that gives the Group a legal or constructive obligation that probably requires settlement by a transfer of economic benefit, and a reliable estimate can be made of the amount of the obligation.
Provisions are charged as an expense to profit or loss in the year that the Group becomes aware of the obligation, and are measured at the best estimate at the Statement of Financial Position date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties.
When payments are eventually made, they are charged to the provision carried in the Statement of Financial Position.

Page 28

 
OAKMAN GROUP PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 2 JULY 2023

2.Accounting policies (continued)

 
2.21

Financial instruments

Basic financial assets

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

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

Other financial assets

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

Financial liabilities

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

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

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

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

Page 29

 
OAKMAN GROUP PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 2 JULY 2023

3.


Judgements in applying accounting policies and key sources of estimation uncertainty

Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of furture events that are believed to be reasonable under the circumstances. Although these estimates are based on management's best knowledge of the amount, events or actions, actual results ultimately may differ from those estimates. The directors consider the following to be the critical estimates and judgements applicable to the financial statements.
Tangible Fixed Assets
The estimated useful economic lives of tangible fixed assets are based on management's judgement and experience. When management identifies that actual useful economic lives differ materially from the estimates used to calculate depreciation, that charge is adjusted retrospectively. Due to the significance of tangible fixed asset investment to the company, variations between actual and estimated useful economic lives could impact operating results both positively and negatively, although historically few changes to estimated useful economic lives have been required.
The group is required to evaluate the carrying values of tangible fixed assets for impairment whenever circumstances indicate, in management's judgement, that the carrying value of such assets may not be recoverable. An impairment review requires management to make subjective judgements and estimates regarding the cash generating units under review. Management have identified each site to be a cash generating unit. 
For the sites where there was an indicator of impairment, a review was carried out by comparing the recoverable value of the site to the carrying value. The recoverable value was identified by considering the future cash flows expected at the year end date, an appropriate discount rate and the long term growth rate. All of these values are judgemental and if actual amounts differ from the expected values used there could be a material impact on the financial statements. For the year to 2 July 2023 management have released a historic impairment of £2.7m on certain sites and have recognised an impairment charge of £353k on another. 
Investments in subsidiaries
On 19 June 2020 Oakman Group Limited entered into a share for share exchange with Oakman Inns and Restaurants Limited. The value of each share on this date was identified as £2.50 and this is what has been reflected in the Oakman Group investment value and the share premium account. This value is an estimate and management have used all available information to conclude it is the most appropriate number, including but not limited to new share subscriptions around the time and future expectations and forecasts for the group as of this date. At year end the investment value has been assessed for indicators pf impairment. The shares issued in the year were issued at an average of £2.75 per share and therefore there has been no impairment recognised. 
Recoverability of intercompany and related party debtors
Intercompany balances receivable are reviewed frequently for impairment. Due to the nature of the group
relationship with the subsidiary and related party companies, all balances are considered recoverable as
at the year end.

Page 30

 
OAKMAN GROUP PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 2 JULY 2023

4.


Turnover

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


2023
2022
£
£

Wet sales
22,845,175
20,500,086

Dry sales
31,688,476
29,929,687

Accommodation
4,242,459
3,780,421

Other income
718,994
1,568,256

Discounts and complimentaries
(1,686,912)
(1,359,663)

57,808,192
54,418,787


All turnover arose within the United Kingdom.


5.


Other operating income

2023
2022
£
£

Net rents receivable
293,034
269,904

Government grants receivable
-
227,117

293,034
497,021


The Group was awarded government grants amounting to £nil (2022 - £227,117) in relation to the Coronavirus Job Retention Scheme.


6.


Operating profit

The operating profit is stated after charging:

2023
2022
£
£

Depreciation of tangible fixed assets
3,147,212
2,549,346

Amortisation of intangible assets
51,199
56,471

Operating lease rentals
3,080,100
2,747,236

Impairment of tangible fixed assets
353,000
985,000

Reversal of impairment of tangible fixed assets
(2,728,732)
(751,000)

Page 31

 
OAKMAN GROUP PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 2 JULY 2023

7.


Auditors' remuneration

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


2023
2022
£
£

Fees payable to the Company's auditors and their associates for the audit of the consolidated and parent Company's financial statements
136,600
105,420

Fees payable to the Company's auditors and their associates in respect of:

Taxation compliance services
47,555
36,700

Company secretarial support services for the Group
8,000
8,000


8.


Employees

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


Group
2 July
Group
3 July
Company
2 July
Company
3 July
2023
2022
2023
2022
£
£
£
£


Wages and salaries
22,987,060
22,314,476
-
-

Social security costs
1,660,409
1,544,443
-
-

Cost of defined contribution scheme
536,932
458,532
-
-

25,184,401
24,317,451
-
-


The average monthly number of employees, including the Directors, during the period was as follows:


        2023
        2022
            No.
            No.







Retail
1,293
1,255



Office
88
80

1,381
1,335

The Company has no employees other than the Directors, who did not receive any remuneration (2022 - £NIL)
Page 32

 
OAKMAN GROUP PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 2 JULY 2023

9.


Directors' remuneration

2023
2022
£
£

Directors' emoluments
1,233,169
1,107,318

Group contributions to defined contribution pension schemes
39,775
64,649

1,272,944
1,171,967


The highest paid Director received remuneration of £220,000 (2022 - £178,113).

The value of the Group's contributions paid to a defined contribution pension scheme in respect of the highest paid Director amounted to £NIL (2022 - £18,125).


10.


Interest payable and similar expenses

2023
2022
£
£


Bank interest payable
2,678,164
1,278,127

Shareholder loans
2,323,534
3,558,137

Other interest payable
-
(140,952)

5,001,698
4,695,312


11.


Taxation


2023
2022
£
£



Total current tax
-
-

Deferred tax

Total deferred tax
-
-


Taxation on profit on ordinary activities
-
-
Page 33

 
OAKMAN GROUP PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 2 JULY 2023
 
11.Taxation (continued)


Factors affecting tax charge for the period

The tax assessed for the period is the same as (2022 - the same as) the standard rate of corporation tax in the UK of 20.53% (2022 - 19%) as set out below:

2023
2022
£
£


Loss on ordinary activities before tax
(8,053,418)
(3,268,490)


Loss on ordinary activities multiplied by standard rate of corporation tax in the UK of 20.53% (2022 - 19%)
(1,653,367)
(624,163)

Effects of:


Expenses not deductible for tax purposes, other than goodwill amortisation and impairment
1,027,534
378,545

Capital allowances for period in excess of depreciation
(40,890)
228,516

Non-taxable income
41,130
(37,577)

Other permanent differences
5,778
2,586

Deferred tax not recognised
783,107
52,093

Changes to tax rates
(142,011)
-

Other tax adjustments, reliefs & transfers
(21,281)
-

Total tax charge for the period
-
-


Factors that may affect future tax charges

On 24 May 2021 the increase of corporation tax to 25% was substantively enacted, as of 1 April 2023. The deferred tax at the balance sheet date has therefore been measured at this rate.


12.


Exceptional items

2 July
3 July
2023
2022
£
£
Pre-opening costs

175,141

431,676
 
Other exceptional items

825,104

677,623
 
Fixed asset impairment charge

353,000

234,000
 
Fixed asset impairment release

(2,728,732)

-
 
(1,375,487)

1,343,299
 

Page 34

 
OAKMAN GROUP PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 2 JULY 2023

13.


Parent company profit for the year

The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of Comprehensive Income in these financial statements. The loss after tax of the parent Company for the period was £19,478 (2022 - loss £16,637).


14.


Intangible assets

Group 







Development expenditure

£



Cost


At 4 July 2022
843,239


Additions 
54,248



At 2 July 2023

897,487



Amortisation


At 4 July 2022
738,348


Charge for the period
51,199



At 2 July 2023

789,547



Net book value



At 2 July 2023
107,940



At 3 July 2022
104,891



Page 35

 
OAKMAN GROUP PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 2 JULY 2023

15.


Tangible fixed assets

Group








Freehold property
Leasehold property
Plant and machinery
Fixtures, fittings and equipment
Other fixed assets

£
£
£
£
£



Cost or valuation


At 4 July 2022
42,190,844
21,890,473
2,611,390
16,141,959
1,250,597


Additions
2,288,971
1,183,137
4,676
3,219,689
744,110


Disposals
-
-
(4,580)
-
-



At 2 July 2023

44,479,815
23,073,610
2,611,486
19,361,648
1,994,707



Depreciation


At 4 July 2022
907,161
5,416,998
1,943,341
6,681,992
897,283


Charge for the period 
-
990,948
209,797
1,591,547
354,920


Impairment charge
-
353,000
-
-
-


Impairment losses written back
(907,161)
(1,821,571)
-
-
-



At 2 July 2023

-
4,939,375
2,153,138
8,273,539
1,252,203



Net book value



At 2 July 2023
44,479,815
18,134,235
458,348
11,088,109
742,504



At 3 July 2022
41,283,683
16,473,475
668,049
9,459,967
353,314
Page 36

 
OAKMAN GROUP PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 2 JULY 2023

           15.Tangible fixed assets (continued)


Total

£



Cost or valuation


At 4 July 2022
84,085,263


Additions
7,440,583


Disposals
(4,580)



At 2 July 2023

91,521,266



Depreciation


At 4 July 2022
15,846,775


Charge for the period 
3,147,212


Impairment charge
353,000


Impairment losses written back
(2,728,732)



At 2 July 2023

16,618,255



Net book value



At 2 July 2023
74,903,011



At 3 July 2022
68,238,488

Page 37

 
OAKMAN GROUP PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 2 JULY 2023

16.


Fixed asset investments

Company








Investments in subsidiary companies

£



Cost or valuation


At 4 July 2022
28,527,892



At 2 July 2023
28,527,892





Subsidiary undertakings


The following were subsidiary undertakings of the Company:

Name

Class of shares

Holding

Oakman Inns and Restaurants Limited
Ordinary
100%
Oakman Property Limited*
Ordinary
100%
Oakman Bedfordshire Holdings Limited*
Ordinary
100%
The Beech Hut Limited*
Ordinary
100%
Oakman Ventures
Ordinary
100%
Hunky Dory Pubs Limited*
Ordinary
100%
Ashmore Inns Limited *
Ordinary
100%
Oakman Inns (P & E) Limited
Ordinary
100%
Downoak Limited*
Ordinary
100%
Hedderwick Limited *
Ordinary
100%
Oakman Dev Limited*
Ordinary
100%

* indirect holding         
The registered address for all subsidiary undertakings, direct of indirect, is: Saxon House, 211 High Street, Berkhamsted, Hertfordshire, United Kingdom, HP4 1AD.

Page 38

 
OAKMAN GROUP PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 2 JULY 2023

17.


Stocks

Group
2 July
Group
3 July
2023
2022
£
£

Finished goods and goods for resale
804,735
543,348

804,735
543,348


The difference between purchase price or production cost of stocks and their replacement cost is not material.


18.


Debtors

Group
2 July
Group
3 July
Company
2 July
Company
3 July
2023
2022
2023
2022
£
£
£
£


Trade debtors
287,980
497,676
-
-

Amounts owed by group undertakings
-
-
29,131,155
23,723,363

Amounts owed by joint ventures and associated undertakings
200,275
806,574
1,756
-

Other debtors
2,766,898
2,269,512
2,751
3,091

Prepayments and accrued income
653,259
2,725,548
-
-

3,908,412
6,299,310
29,135,662
23,726,454


Amounts owed by group undertakings and related parties are interest free and repayable on demand.


19.


Cash and cash equivalents

Group
2 July
Group
3 July
Company
2 July
Company
3 July
2023
2022
2023
2022
£
£
£
£

Cash at bank and in hand
326,251
3,163,241
1,224
7,840

326,251
3,163,241
1,224
7,840


Page 39

 
OAKMAN GROUP PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 2 JULY 2023

20.


Creditors: Amounts falling due within one year

Group
2 July
Group
3 July
Company
2 July
Company
3 July
2023
2022
2023
2022
£
£
£
£

Shareholder loans
8,073,812
11,598,411
-
-

Bank loans
9,014,909
7,977,318
-
-

Other loans
3,327,059
-
-
-

Trade creditors
7,198,392
5,667,334
1,425
-

Amounts owed to group undertakings
-
-
100
-

Amounts owed to related parties
292,847
310,182
-
-

Other taxation and social security
2,341,317
4,381,078
-
-

Other creditors
2,057,658
1,642,282
2,751
101,744

Accruals and deferred income
11,058,749
6,428,936
12,980
12,980

43,364,743
38,005,541
17,256
114,724


Amounts owed to related parties are interest free and repayable on demand.


21.


Creditors: Amounts falling due after more than one year

Group
2 July
Group
3 July
2023
2022
£
£

Bank loans
29,243,070
29,445,043

Other loans
1,400,000
4,201,692

30,643,070
33,646,735




Page 40

 
OAKMAN GROUP PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 2 JULY 2023

22.


Loans


Analysis of the maturity of loans is given below:


Group
2 July
Group
3 July
2023
2022
£
£

Amounts falling due within one year

Bank loans
9,014,909
7,977,318

Other loans
3,327,059
-

Shareholder loans
8,073,812
11,598,411


20,415,780
19,575,729

Amounts falling due 1-2 years

Bank loans
438,601
-

Other loans
-
4,201,692


438,601
4,201,692

Amounts falling due 2-5 years

Bank loans
28,804,468
29,445,043

Other loans
1,400,000
-


30,204,468
29,445,043


51,058,849
53,222,464


Page 41

 
OAKMAN GROUP PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 2 JULY 2023
 
22.Loans (continued)

Shareholder Loans
During the prior year £3.1m of shareholder loans were converted to equity in Oakman Group Plc. The shareholder loans balance as at 2nd July 2023 is made up of: 
£6,367,720 (2022 - £9,948,406) of loans were due in less than one year but subordinated to the bank loan with Santander. Interest on these loans is 10% per annum.
£997,504 (2022 - £962,342) of loans were due in less than one year but subordinated to the bank loan with Santander. Interest on these loans was renegotiated during the prior year to 18% per annum when the business was allowed to trade but a reduced rate of 12% per annum when the business was forced to close due to COVID-19 restrictions.
£708,586 (2022 - £708,586) of loans were due in less than one year but subordinated to the bank loan with Santander with interest payable at 20% per annum.
Other loans
£3,327,059 (2022: £3,348,992) of loans are due within one year  with interest payable at 8% per annum. This loan was previously due on 30 April 2024 but an extension was obtained post year end and this loan iis now due for repayment on 30 April 2025.
£1,400,000 (2022: £1,400,000) of other loans are due on 29 October 2025 with interest on these loans at 10% per annum. This loan was previously due on 29 October 2024 but an extension was obtained post year end. 
Bank Loans
The bank loans balance is made up of:
A bank loan for £2,980,308 (2022 - £3,373,486) with Santander. The loan is split 84:16 between the Senior Capital Facility and the Growth Capital Facility. Interest is charged at 5% per annum. Since, the period end, the senior capital facility was repaid in full. The Growth Capital Facility is repayable on 31 January 2025. This loan was previously due on 30 April 2024 but an extension was obtained during the year. The loan is secured on this company’s leasehold properties.
A £2,376,000 (2022: £2,376,000) overdraft issued through the CBIL's scheme. The overdraft was drawn down on 26 June 2020. The overdraft is repayable on demand and has a maximum term of 3 years. Interest on this overdraft was covered by the government for the first year and is then charged at base rate plus 3.25%. The group has access to another overdraft issued under CBIL's for £386,000 (2022- £386,000). This additional overdraft has the same terms but was not drawn upon as at 2 July 2023. During the year £nil (2022 - £nil) of interest payable on this loan was rolled up into the capital value due to Covid-19 concessions being given. It is now due as part of the final loan repayment and has therefore been disclosed within the bank loan balance. Post year end an extenstion was obtained to January 2025 although it should be noted that the Coronavirus Business Interruption Loan is an overdraft and therefore technically repayable on demand.
A bank loan of £29,693,671 (2022: £28,993,000) held with Cynergy Bank held in Oakman Inns P&E Limited  was drawn down in January 2022. The loan carries interest at base rate plus 3.65% p.a. payable monthly. The loan is interest only for the first year, after which quarterly capital repayments start, and the balance is due on the repayment being January 2027. The loan is secured against the assets of Oakman Inns (P&E) Limited, Oakman Property Limited, Oakman Bedfordshire Holdings Limited, Downoak Limited and Hedderwick Limited. The loan is disclosed net of arrangement fees which total £124,000 (2022 - £176,541).
 
Page 42

 
OAKMAN GROUP PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 2 JULY 2023
 
22.Loans (continued)












23.


Share capital

2 July
3 July
2023
2022
£
£
Allotted, called up and fully paid



24,536,288 (2022 - 19,236,573) Ordinary shares of £0.10 each
2,453,629
1,923,657
2,449,410 (2022 - 2,149,405) Ordinary A shares of £0.10 each
244,941
214,941
1,000 (2022 - 1,000) Ordinary B shares of £0.10 each
100
100

2,698,670

2,138,698


During the year, the company issued 5,299,720 Ordinary shares and 299,980 Ordinary A share of £0.10
each at a total premium of £4,959,568. 

Page 43

 
OAKMAN GROUP PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 2 JULY 2023

24.


Reserves

Share premium account

Includes any premiums recieved on issue of share capital. Any transaction costs associated with the issuing of shares are deducted from share premium.

Other reserves

The other reserve holds shares to be issued as part of the employee share plan.

Merger Reserve

Includes the difference between the value of shares issued by the Company in exchange for the value of shares acquired in respect of the acquisition of subsidiaries.

Profit and loss account

Includes all profits and losses accumulated in the current and previous periods.
Warrant reserve
Represents the value of the warrant instruments issued in respect of shares of Oakman Inns & Restaurants Limited. During the prior year, this warrant was released and the reserve was transferred to the profit and loss reserve.
Preference share 
Represents the nominal value of preference shares in place that are held by Oakman Inns and Restaurants Limited.


25.


Pension commitments

The Group operates a defined contributions pension scheme for all employees within the group. The assets of the scheme are held separately from those of the Group in an independently administered fund. Contributions totalling £536,932 (2022 - £223,400) were payable to the fund at the reporting date.


26.


Commitments under operating leases

At 2 July 2023 the Group and the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:


Group
2 July
Group
3 July
2023
2022
£
£

Not later than 1 year
3,158,000
2,750,000

Later than 1 year and not later than 5 years
12,632,000
10,998,000

Later than 5 years
48,958,000
42,514,000

64,748,000
56,262,000
Page 44

 
OAKMAN GROUP PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 2 JULY 2023

27.


Related party transactions

During the period to 2 July 2023 fees of £542,262 (2022: £1,455,011) were charged to companies under
common control due to mutual directors but not subsidiaries of Oakman Group Plc. At the period end
£261,825 (2022: £1,570,411) of these fees were owed which are included within the debtors balance.
Included within creditors is £240,492 (2022: £245,748) owed to companies under common control due to
mutual directors. Similarly, included within debtors there is £944,063 (2022: £826,325) owed by
companies under common control due to mutual directors. Of this amount £826,325 (2022: £826,325)
has been provided for at year end.
IIncluded within shareholder loans is an amount of £5,105,732 (2022: £4,897,626) which are loans held
by current directors who retied in the year, companies with common directorships and their close family.
The total interest accrued on these loans is £5,485,927 (2022; £1,632,939). During the year £1,459,898
(2022: 306,253) of interest was charged.
In the prior year an amount of £2,030,522 of shareholders loans owned by Directors or companies with
common directors was converted to 804,854 shares in Oakman Group Plc. There were no conversions in
the year to 2 July 2023.

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OAKMAN GROUP PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 2 JULY 2023

28.


Post balance sheet events

Refinancing
The Group completed the refinance of the following secured loans:
In January 2024, Santander extended the maturity dates for the Growth Capital Loan Facility and Coronavirus Business Interruption Loan to January 2025 although it should be noted that the Coronavirus Business Interruption Loan is an overdraft and therefore technically repayable on demand.
In January 2024, Haywood (L&C) Limited agreed to extend the maturity date for the Loan Facility to October 2025.
Trading
In September 2022, the development of the site at Watford completed and The Beech House, Watford, as it is called, began to trade.
In October 2022, the business secured the leasehold of The Navigation Inn in Lapworth, Warwickshire which began trading from that date.
Restructure
On 3rd June 2023, the Group completed a reorganisation of the corporate Group structure, reducing the number of trading entities from 12 companies to 5. The elimination of 7 entities was designed to remove subsidiaries that added no value to the Group other than their trading assets which were transferred to retained Group entities to create a more efficient Group structure. All transfers were intra-group and no assets left the group. The assets and liabilities of the eliminated entities were transferred as follows:
Eliminated entity                                       Transferee Entity
Beech Hut Limited                                    Oakman Dev Limited
Oakman Properties Limited                        Oakman (P&E) Limited
Oakman Bedfordshire Holdings Limited       Oakman (P&E) Limited
Downoak Limited                                       Oakman (P&E) Limited
Hedderwick Limited                                   Oakman (P&E) Limited
Oakman Ventures Limited                          Oakman Inns and Restaurants Limited 
Hunky Dory Pubs Limited                           Oakman Inns and Restaurants Limited


29.


Controlling party

There is no ultimate controlling party.

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