Caseware UK (AP4) 2022.0.179 2022.0.179 2021-12-312021-05-142021-05-142021-12-312021-12-3102021-01-01falseHolding Company00falsefalse 11970895 2021-01-01 2021-12-31 11970895 2020-01-01 2020-12-31 11970895 2021-12-31 11970895 2020-12-31 11970895 2020-01-01 11970895 1 2021-01-01 2021-12-31 11970895 d:CompanySecretary1 2021-01-01 2021-12-31 11970895 d:Director1 2021-01-01 2021-12-31 11970895 d:Director2 2021-01-01 2021-12-31 11970895 d:Director3 2021-01-01 2021-12-31 11970895 d:Director4 2021-01-01 2021-12-31 11970895 d:Director5 2021-01-01 2021-12-31 11970895 d:Director5 2021-12-31 11970895 d:RegisteredOffice 2021-01-01 2021-12-31 11970895 c:Buildings c:LongLeaseholdAssets 2021-01-01 2021-12-31 11970895 c:MotorVehicles 2021-01-01 2021-12-31 11970895 c:FurnitureFittings 2021-01-01 2021-12-31 11970895 c:ComputerEquipment 2021-01-01 2021-12-31 11970895 c:Goodwill 2021-01-01 2021-12-31 11970895 c:CurrentFinancialInstruments 2021-12-31 11970895 c:CurrentFinancialInstruments 2020-12-31 11970895 c:Non-currentFinancialInstruments 2021-12-31 11970895 c:Non-currentFinancialInstruments 2020-12-31 11970895 c:Non-currentFinancialInstruments 1 2021-12-31 11970895 c:Non-currentFinancialInstruments 1 2020-12-31 11970895 c:CurrentFinancialInstruments c:WithinOneYear 2021-12-31 11970895 c:CurrentFinancialInstruments c:WithinOneYear 2020-12-31 11970895 c:Non-currentFinancialInstruments c:AfterOneYear 2021-12-31 11970895 c:Non-currentFinancialInstruments c:AfterOneYear 2020-12-31 11970895 c:ShareCapital 2021-12-31 11970895 c:ShareCapital 2020-01-01 2020-12-31 11970895 c:ShareCapital 2020-12-31 11970895 c:ShareCapital 2020-01-01 11970895 c:SharePremium 2021-12-31 11970895 c:SharePremium 2020-01-01 2020-12-31 11970895 c:SharePremium 2020-12-31 11970895 c:SharePremium 2020-01-01 11970895 c:RetainedEarningsAccumulatedLosses 2021-01-01 2021-12-31 11970895 c:RetainedEarningsAccumulatedLosses 2021-12-31 11970895 c:RetainedEarningsAccumulatedLosses 2020-01-01 2020-12-31 11970895 c:RetainedEarningsAccumulatedLosses 2020-12-31 11970895 c:RetainedEarningsAccumulatedLosses 2020-01-01 11970895 c:FinancialAssetsDesignatedFairValueThroughProfitOrLoss 2021-12-31 11970895 c:FinancialAssetsDesignatedFairValueThroughProfitOrLoss 2020-12-31 11970895 d:OrdinaryShareClass1 2021-01-01 2021-12-31 11970895 d:OrdinaryShareClass1 2021-12-31 11970895 d:OrdinaryShareClass1 2020-12-31 11970895 d:FRS102 2021-01-01 2021-12-31 11970895 d:Audited 2021-01-01 2021-12-31 11970895 d:FullAccounts 2021-01-01 2021-12-31 11970895 d:PrivateLimitedCompanyLtd 2021-01-01 2021-12-31 11970895 c:Subsidiary1 2021-01-01 2021-12-31 11970895 c:Subsidiary1 1 2021-01-01 2021-12-31 11970895 d:Consolidated 2021-12-31 11970895 d:ConsolidatedGroupCompanyAccounts 2021-01-01 2021-12-31 11970895 2 2021-01-01 2021-12-31 11970895 5 2021-01-01 2021-12-31 11970895 6 2021-01-01 2021-12-31 xbrli:shares iso4217:GBP xbrli:pure

Registered number: 11970895










GCUK OWNER LTD








ANNUAL REPORT AND FINANCIAL STATEMENTS


FOR THE YEAR ENDED 31 DECEMBER 2021

 
GCUK OWNER LTD
 
 
COMPANY INFORMATION


Directors
Justin David Petersen (appointed 17 May 2021) 
Eric Donald Hassberger (appointed 17 May 2021) 
Andrew Jay Weprin 
Benjamin Jason Weprin 
Patrick James Stephens (resigned 14 May 2021)




Company secretary
Broughton Secretaries Limited



Registered number
11970895



Registered office
54 Portland Place

London

England

W1B 1DY




Independent auditors
MHA
Statutory Auditors

2 London Wall Place

London

EC2Y 5AU





 
GCUK OWNER LTD
 

CONTENTS



Page
Group Strategic Report
1 - 3
Directors' Report
4 - 5
Independent Auditors' Report
6 - 8
Consolidated Statement of Comprehensive Income
9
Consolidated Balance Sheet
10 - 11
Company Balance Sheet
12
Consolidated Statement of Changes in Equity
13 - 14
Company Statement of Changes in Equity
15 - 16
Consolidated Statement of Cash Flows
17 - 18
Consolidated Analysis of Net Debt
19
Notes to the Financial Statements
20 - 38


 
GCUK OWNER LTD
 
 
GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2021

Introduction
 
The directors present their strategic report of the Group and Company for the year ended 31 December 2021.
Business Review:
The Group’s principal activity is the operation of the Graduate Cambridge Hotel in Cambridge. The Company’s principal activity is the holding of debt and other financial instruments for the Group.
The hotel reopened in August 2021 following its refurbishment which commenced October 2020. The refurbishment had a significant negative impact on the number of available and occupied rooms until reopening. The loss for the year after taxation amounted to £5,405,700 (2020: £8,598,046 loss).
Principal risks and uncertainties:
Some risks are excluded because management considers them not to be material to the Group. Additionally, there may be risks and uncertainties not presently known to the management team or which are deemed immaterial to the Group.
Market and hotel industry risks:
The Group’s operations and its results are subject to a number of factors which could affect the business, many of which are common to the hotel industry and beyond the Group’s control, such as a potential global economic downturn; changes in travel patterns in the structure of the travel industry; and the potential increase in acts of terrorism. The impact of any of these factors (or a combination of them) may adversely affect sustained levels of occupancy, room rates and/or hotel values.
Management recognises that Brexit and COVID-19 add an element of uncertainty to the outlook of both the U.K. hospitality industry and the greater U.K. economy which could impact future trade. 
Although management seeks to identify risks at the earliest opportunity, many of these risks are beyond the control of the Group. The Group has recovery plans in place to enable it to respond to major incidents or crises and takes steps to minimise these exposures to the greatest extent possible.
Borrowings:
As with all loan financing, there is a risk that the Group may be at risk of default under the financing arrangements. 
To mitigate against this risk, the management team meet regularly to review the performance of the hotel. The covenant ratios within the financing agreement are applied to the hotel and monitored on an ongoing basis. 
Fixed operating expenses:
The Group incurs operating expenses such as personnel costs, operating leases, information technology and telecommunications which are to a large extent fixed. As such, operating results may be vulnerable to short-term changes in revenues.
 
Page 1

 
GCUK OWNER LTD
 

GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2021


The Group has appropriate management systems in place such as staff outsourcing designed to create flexibility in operating cost base so as to optimise operating profits in volatile trading conditions.
Key senior personnel and management:
The success of the Group is partially attributable to the efforts and abilities of its senior managers. Failure to retain its senior management teams or other key personnel may threaten the success of the Group’s operations.
The Group has appropriate systems in place for recruitment, reward and compensation, and performance management. Development and maintenance of the Group’s culture also plays a leading role in minimising risk.
The key senior management in the hotels is provided by Schulte Hospitality Group UK Ltd and therefore there is a pool of staff available should key personnel leave.
Pricing:
Pricing is established using a bottom-up segmentation analysis of occupancy rates and average daily rates (“ADR”). Baseline assumptions are derived from a variety of third-party sources including Smith Travel Research (“STR”) reports, operating budgets provided by the Group’s third-party management platform, and historical performance. The Group utilizes this information in conjunction with trends observed at other properties with similar market dynamics. 
Cash flow:
The ability to generate cash flow to pay staff, vendors, debt service and all other third parties is crucial for the longevity of the Group. The Group closely monitors all available sources of capital via hotel revenue and reserves to ensure the ability to make payments when due.

Financial key performance indicators
 
Gross operating profit is the primary financial key performance indicator (“KPI”) utilized by the Group to monitor the operations of the hotel being defined as revenue less cost of sales. The Group views this metric as its most significant financial KPI as it reflects how effectively it is able to generate profit from hotel operations. This is noted as being £1,629,169 (2020: £1,871,052) for the year. Due to the effects of COVID-19 resulting in the closure of the hotel and prolonged refurbishment period, the Group did not meet its expectations for the year.

Other key performance indicators
 
The three other KPI's relevant to the Group and overall hospitality industry are average daily rate (“ADR”), occupancy, and revenue per available room (“RevPAR”). ADR measures the average rental revenue per occupied room and is calculated as total room revenue divided by the number of rooms sold. Occupancy rate is measured by dividing the number of occupied rooms by the number of available rooms. RevPAR measures the amount of revenue generated by a single room and is calculated as room revenue divided by the total number of available rooms. These KPI's are used to monitor success in that the figures reflect the ability to generate guest stays and maximize the amount of associated revenue. As noted above, the Group did not meet its expectations for the year with respect to these performance measures.

Future developments

The directors expect the business to continue operating for the foreseeable future. The property has since reopened under the Graduate Hotels brand and the gradual withdrawal of lockdown restrictions has led to improved trade and results for this reporting period.

Page 2

 
GCUK OWNER LTD
 

GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2021


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



Justin David Petersen (appointed 17 May 2021)
Director

Date: 21 February 2024

Page 3

 
GCUK OWNER LTD
 
 
 
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2021

The directors present their report and the financial statements for the year ended 31 December 2021.

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 judgments 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 year, after taxation, amounted to £5,405,700 (2020 - loss £8,598,046).

The dividends voted for the year amounted to £NIL (2020: £NIL).

Directors

The directors who served during the year were:

Justin David Petersen (appointed 17 May 2021) 
Eric Donald Hassberger (appointed 17 May 2021) 
Andrew Jay Weprin 
Benjamin Jason Weprin 
Patrick James Stephens (resigned 14 May 2021)

Future developments

Future developments of the Company and Group are discussed in the strategic report.

Page 4

 
GCUK OWNER LTD
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2021

Disclosure of information to auditors

Each of the persons who are the directors at the time when this Directors' Report 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 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.

Post balance sheet events

Post-balance sheet events of the Company and Group have been discussed in note 25 in the financial statements.

Qualifying third party indemnity provisions

Qualifying third party indemnity provision subsists for the benefit of the Director and was in place throughout the
financial year.

Auditors

Following a rebranding exercise on 15 May 2023 the trading name of the company's independent auditor changed from MHA MacIntyre Hudson to MHA. A resolution to appoint MHA as independent auditor will be proposed at the next Annual General Meeting. 

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





Justin David Petersen
Director

Date: 21 February 2024

Page 5

 
GCUK OWNER LTD
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF GCUK OWNER LTD
 

Opinion


We have audited the financial statements of GCUK Owner Ltd (the 'parent Company') and its subsidiary (the 'Group') for the year ended 31 December 2021, which comprise the Group Statement of Comprehensive Income, the Group and Company Balance Sheets, the Group Statement of Cash Flows, the Group and 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 31 December 2021 and of the Group's loss for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.


Basis for opinion


We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the 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.


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 or the 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.


Page 6

 
GCUK OWNER LTD
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF GCUK OWNER LTD (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 Report.  Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated.  If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves.  If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.


We have nothing to report in this regard.


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 year 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 4, 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 7

 
GCUK OWNER LTD
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF GCUK OWNER LTD (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:

• enquiry of management and those charged with governance around actual and potential litigation and claims;
• performing audit work over the risk of management override of controls, including testing of journal entries and other adjustments for appropriateness, evaluating the business rationale of significant transactions outside the normal course of business and reviewing accounting estimates for bias;
•  reviewing minutes of meetings of those charged with governance;
•  reviewing financial statement disclosures and testing to supporting documentation to assess compliance
with applicable laws and regulations.


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.


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.





Rajeev Shaunak FCA (Senior Statutory Auditor)
  
for and on behalf of
MHA
 
Statutory Auditors
  
London, United Kingdom

 
Date: 
22 February 2024
MHA is the trading name of MacIntyre Hudson LLP, a limited liability partnership in England and Wales (registered number OC312313).
Page 8

 
GCUK OWNER LTD
 
 
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2021

2021
2020
Note
£
£

  

Turnover
 4 
1,878,342
2,039,639

Cost of sales
  
(249,173)
(168,587)

Gross profit
  
1,629,169
1,871,052

Administrative expenses
  
(5,361,238)
(5,538,134)

Other operating income
 5 
-
338,340

Operating loss
 6 
(3,732,069)
(3,328,742)

Amounts written off investments
  
-
(4,970,570)

Interest receivable and similar income
 9 
-
6

Interest payable and similar expenses
 10 
(1,420,865)
(1,521,907)

Loss before taxation
  
(5,152,934)
(9,821,213)

Tax on loss
 11 
(252,766)
1,223,167

Loss for the financial year
  
(5,405,700)
(8,598,046)

  

Unrealised surplus/(deficit) on revaluation of tangible fixed assets
  
6,473,449
(10,672,576)

Income tax relating to other comprehensive income
  
(1,228,877)
1,444,797

Other comprehensive income for the year
  
5,244,572
(9,227,779)

Total comprehensive income for the year
  
(161,128)
(17,825,825)

(Loss) for the year attributable to:
  

Owners of the parent Company
  
(5,405,700)
(8,598,046)

Total comprehensive income for the year attributable to:
  

Owners of the parent Company
  
(161,128)
(17,825,825)

There were no recognised gains and losses for 2021 or 2020 other than those included in the consolidated statement of comprehensive income.

The notes on pages 20 to 38 form part of these financial statements.

Page 9

 
GCUK OWNER LTD
REGISTERED NUMBER: 11970895

CONSOLIDATED BALANCE SHEET
AS AT 31 DECEMBER 2021

2021
2020
Note
£
£

Fixed assets
  

Tangible assets
 13 
79,054,408
59,632,705

Current assets
  

Debtors: amounts falling due after more than one year
 15 
421,119
636,164

Debtors: amounts falling due within one year
 15 
1,874,708
605,469

Cash at bank and in hand
 16 
1,053,856
16,257,948

  
3,349,683
17,499,581

Creditors: amounts falling due within one year
 17 
(27,169,555)
(23,708,035)

Net current liabilities
  
 
 
(23,819,872)
 
 
(6,208,454)

Total assets less current liabilities
  
55,234,536
53,424,251

Creditors: amounts falling due after more than one year
 18 
(39,704,029)
(39,214,259)

Provisions for liabilities
  

Deferred taxation
 20 
(2,975,224)
(1,493,581)

  
 
 
(2,975,224)
 
 
(1,493,581)

Net assets
  
12,555,283
12,716,411


Capital and reserves
  

Called up share capital 
 21 
338,263
338,263

Share premium account
  
31,043,147
31,043,147

Revaluation reserve
  
(4,365,874)
(9,653,098)

Other reserves
  
183,993
-

Profit and loss account
  
(14,644,246)
(9,011,901)

Equity attributable to owners of the parent Company
  
12,555,283
12,716,411


Page 10

 
GCUK OWNER LTD
REGISTERED NUMBER: 11970895
    
CONSOLIDATED BALANCE SHEET (CONTINUED)
AS AT 31 DECEMBER 2021

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




Justin David Petersen
Director

Date: 21 February 2024

The notes on pages 20 to 38 form part of these financial statements.

Page 11

 
GCUK OWNER LTD
REGISTERED NUMBER: 11970895

COMPANY BALANCE SHEET
AS AT 31 DECEMBER 2021

2021
2020
Note
£
£

Fixed assets
  

Investments
 14 
56,000,000
56,000,000

Current assets
  

Debtors: amounts falling due after more than one year
 15 
421,119
636,164

Debtors: amounts falling due within one year
 15 
20,430,677
18,726,532

  
20,851,796
19,362,696

Creditors: amounts falling due within one year
 17 
(25,285,689)
(21,976,841)

Net current liabilities
  
 
 
(4,433,893)
 
 
(2,614,145)

Total assets less current liabilities
  
51,566,107
53,385,855

  

Creditors: amounts falling due after more than one year
 18 
(39,704,029)
(39,214,259)

  

Net assets
  
11,862,078
14,171,596


Capital and reserves
  

Called up share capital 
 21 
338,263
338,263

Share premium account
  
31,043,147
31,043,147

Profit and loss account
  
(19,519,332)
(17,209,814)

  
11,862,078
14,171,596


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


Justin David Petersen
Director

Date: 21 February 2024

The notes on pages 20 to 38 form part of these financial statements.

Page 12

 
GCUK OWNER LTD
 

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2021


Called up share capital
Share premium account
Revaluation reserve
Other reserves
Profit and loss account
Total equity

£
£
£
£
£
£

At 1 January 2021
338,263
31,043,147
(9,653,098)
-
(9,011,901)
12,716,411


Comprehensive income for the year

Loss for the year
-
-
-
-
(5,405,700)
(5,405,700)

Revaluation during the period
-
-
6,473,449
-
-
6,473,449

Depreciation on revaluation surplus
-
-
42,652
-
(42,652)
-

Deferred tax
-
-
(1,228,877)
-
-
(1,228,877)

Transfer to/from profit and loss account
-
-
-
183,993
(183,993)
-


At 31 December 2021
338,263
31,043,147
(4,365,874)
183,993
(14,644,246)
12,555,283


The notes on pages 20 to 38 form part of these financial statements.

Page 13

 
GCUK OWNER LTD
 

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 31 DECEMBER 2020


Called up share capital
Share premium account
Revaluation reserve
Profit and loss account
Total equity

£
£
£
£
£

At 1 January 2020
313,567
31,043,147
(135,220)
(703,954)
30,517,540


Comprehensive income for the year

Loss for the year
-
-
-
(8,598,046)
(8,598,046)

Revaluation during the period
-
-
(10,672,576)
-
(10,672,576)

Depreciation on revaluation surplus
-
-
(290,099)
290,099
-

Deferred tax
-
-
1,444,797
-
1,444,797
Total comprehensive income for the year
-
-
(9,517,878)
(8,307,947)
(17,825,825)


Contributions by and distributions to owners

Shares issued during the year
24,696
-
-
-
24,696


At 31 December 2020
338,263
31,043,147
(9,653,098)
(9,011,901)
12,716,411


The notes on pages 20 to 38 form part of these financial statements.

Page 14

 
GCUK OWNER LTD
 

COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2021


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

£
£
£
£

At 1 January 2021
338,263
31,043,147
(17,209,814)
14,171,596


Comprehensive income for the year

Loss for the year
-
-
(2,309,518)
(2,309,518)


At 31 December 2021
338,263
31,043,147
(19,519,332)
11,862,078


The notes on pages 20 to 38 form part of these financial statements.

Page 15

 
GCUK OWNER LTD
 

COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 31 DECEMBER 2020


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

£
£
£
£

At 1 January 2020
313,567
31,043,147
(1,654,258)
29,702,456


Comprehensive income for the year

Loss for the year
-
-
(15,555,556)
(15,555,556)


Contributions by and distributions to owners

Shares issued during the year
24,696
-
-
24,696


At 31 December 2020
338,263
31,043,147
(17,209,814)
14,171,596


The notes on pages 20 to 38 form part of these financial statements.

Page 16

 
GCUK OWNER LTD
 

CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2021

2021
2020
£
£

Cash flows from operating activities

Loss for the financial year
(5,405,700)
(8,598,046)

Adjustments for:

Amortisation of intangible assets
-
33,492

Depreciation of tangible assets
1,067,426
621,402

Impairment of goodwill
-
4,970,570

Loss on disposal of tangible assets
-
804,253

Government grants
-
(338,340)

Interest paid
1,420,865
1,521,907

Interest received
-
(6)

Taxation charge
252,766
(1,223,167)

Decrease in stocks
-
14,607

(Increase) in debtors
(1,054,193)
(138,469)

Increase in creditors
160,436
665,869

Increase in amounts owed to groups
3,301,058
-

Difference on foreign exchange
214,076
49,827

Net cash generated from operating activities

(43,266)
(1,616,101)


Cash flows from investing activities

Purchase of intangible fixed assets
-
(375,280)

Purchase of tangible fixed assets
(14,015,680)
(3,632,705)

Reclassification of funding transferred to funding agent
-
90,000

Government grants received
-
338,340

Interest received
-
6

Net cash from investing activities

(14,015,680)
(3,579,639)

Cash flows from financing activities

Issue of ordinary shares
-
24,696

Other new loans
489,770
262,602

New loans from group companies
-
19,995,665

Interest paid
(1,420,865)
(1,521,907)

Net cash used in financing activities
(931,095)
18,761,056

Net (decrease)/increase in cash and cash equivalents
(14,990,041)
13,565,316

Cash and cash equivalents at beginning of year
16,257,948
2,742,459

Difference on foreign exchange
(214,076)
(49,827)
Page 17

 
GCUK OWNER LTD
 

CONSOLIDATED STATEMENT OF CASH FLOWS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2021


2021
2020

£
£


Cash and cash equivalents at the end of year
1,053,831
16,257,948


Cash and cash equivalents at the end of year comprise:

Cash at bank and in hand
1,053,856
16,257,948

Bank overdrafts
(25)
-

1,053,831
16,257,948


The notes on pages 20 to 38 form part of these financial statements.

Page 18

 
GCUK OWNER LTD
 

CONSOLIDATED ANALYSIS OF NET DEBT
FOR THE YEAR ENDED 31 DECEMBER 2021




At 1 January 2021
Cash flows
At 31 December 2021
£

£

£

Cash at bank and in hand

16,257,948

(15,204,092)

1,053,856

Bank overdrafts

-

-

-

Debt due after 1 year

(39,214,259)

(489,770)

(39,704,029)


(22,956,311)
(15,693,862)
(38,650,173)

The notes on pages 20 to 38 form part of these financial statements.

Page 19

 
GCUK OWNER LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021

1.


General information

GCUK Owner Limited, company number 11970895, is a private company limited by shares, registered
and incorporated in England and Wales within the United Kingdom. The registered office address is 54 Portland Place, London, United Kingdom, W1B 1DY. The principal activity of the Company is to act as a holding entity for a hotel and hospitality company.
The Group's functional and presentational currency is GBP rounded to the nearest £1.

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 judgment in applying the Group's accounting policies (see note 3).

The parent 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.

In preparing the separate financial statements of the parent Company, advantage has been taken of the FSR102 exemption to not disclose a Statement of Cash Flows for the parent Company.

The following principal accounting policies have been applied:

 
2.2

Basis of consolidation

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 Balance Sheet, 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 20

 
GCUK OWNER LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021

2.Accounting policies (continued)

 
2.3

Going concern

The directors confirm that, having reviewed the Group’s and Company’s cash requirements for the next 12 months from the date of signing the financial statements, they have formed a judgement that the Group and Company have reasonable expectations that adequate resources will be available to continue operations for the foreseeable future. The Group has also received confirmation of support from its parent, for at least 12 months after the signing of the audit report, which provides additional security on the resources available (with the exception of the Deutsche Bank loan highlighted below) to continue as a going concern. Therefore, these financial statements have been prepared on the going concern basis. In forming this judgement, the directors have reviewed forecasts for 2024-25, cash flow projections from the date of the approval of these financial statements, contingency planning and the sufficiency of banking facilities. The Company is reliant on the continued trading performance of the Group, which is in a net assets position. The directors are comfortable that the Group will generate sufficient value to continue to settle liabilities as they fall due.

 
2.4

Revenue

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised:

Sale of goods

Revenue from the sale of goods is recognised when all of the following conditions are satisfied:
the Group has transferred the significant risks and rewards of ownership to the buyer;
the Group retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;
the amount of revenue can be measured reliably;
it is probable that the Group will receive the consideration due under the transaction; and
the costs incurred or to be incurred in respect of the transaction can be measured reliably.

Rendering of services

Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:
the amount of revenue can be measured reliably;
it is probable that the Group will receive the consideration due under the contract;
the stage of completion of the contract at the end of the reporting period can be measured reliably; and
the costs incurred and the costs to complete the contract can be measured reliably.

Page 21

 
GCUK OWNER LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021

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.

 
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 year 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 Balance Sheet. The assets of the plan are held separately from the Group in independently administered funds.

 
2.11

Current and deferred taxation

The tax expense for the year comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.

The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the balance sheet date in the countries where the Company and the Group operate and generate income.
 
Page 22

 
GCUK OWNER LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021

2.Accounting policies (continued)


2.11
Current and deferred taxation (continued)


Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the balance sheet date, except that:
The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits;
Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met; and
Where they relate to timing differences in respect of interests in subsidiaries, associates, branches and joint ventures and the Group can control the reversal of the timing differences and such reversal is not considered probable in the foreseeable future.

Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

 
2.12

Intangible assets

Goodwill

Goodwill represents the difference between amounts paid on the cost of a business combination and the acquirer’s interest in the fair value of the Group's share of its identifiable assets and liabilities of the acquiree at the date of acquisition. Subsequent to initial recognition, goodwill is measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is amortised on a straight-line basis to the Consolidated Statement of Comprehensive Income over its useful economic life.
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.

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.

 The estimated useful lives range as follows:

Goodwill
-
over period of lease of the property, 0.833%.

Page 23

 
GCUK OWNER LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021

2.Accounting policies (continued)

 
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.

At each reporting date the Group 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.

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:

Long-term leasehold property
-
over period of lease of the property, 0.933%.
Pre-opening expenditure
-
over period of 1 year and 1 day, 100%
Fixtures and fittings
-
over period of 8 years, 12.5%
Computer equipment
-
over period of 3 years, 33%

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

Revaluation of tangible fixed assets

Individual freehold and leasehold properties are carried at current year value at fair value at the date of the revaluation less any subsequent accumulated depreciation and subsequent accumulated impairment losses. Revaluations are undertaken with sufficient regularity to ensure the carrying amount does not differ materially from that which would be determined using fair value at the balance sheet date.
Fair values are determined from market based evidence normally undertaken by professionally qualified valuers.

Revaluation gains and losses are recognised in other comprehensive income unless losses exceed the previously recognised gains or reflect a clear consumption of economic benefits, in which case the excess losses are recognised in profit or loss.

Page 24

 
GCUK OWNER LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021

2.Accounting policies (continued)

 
2.15

Impairment of fixed assets and goodwill

Assets that are subject to depreciation or amortisation are assessed at each balance sheet 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 balance sheet date to assess whether there is any indication that the impairment losses recognised in prior periods may no longer exist or may have decreased.

 
2.16

Valuation of investments

Investments in subsidiaries are measured at cost less accumulated impairment.

Investments in unlisted Group shares, whose market value can be reliably determined, are remeasured to market value at each balance sheet date. Gains and losses on remeasurement are recognised in the Consolidated Statement of Comprehensive Income for the period. Where market value cannot be reliably determined, such investments are stated at historic cost less impairment.

 
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.

 
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.

Page 25

 
GCUK OWNER LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021

2.Accounting policies (continued)

 
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 balance sheet 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 Balance Sheet.

 
2.21

Financial instruments

The Group have elected to apply the provision of Section 11 'Basic Financial Instruments' and Section 12 'Other Financial Instrument Issues' of FRS102 to all of its financial instruments.The Group only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in ordinary shares.

Debt instruments (other than those wholly repayable or receivable within one year), including loans and other accounts receivable and payable, are initially measured at present value of the future cash flows and subsequently at amortised cost using the effective interest method. Debt instruments that are payable or receivable within one year, typically trade debtors and creditors, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received. However, if the arrangements of a short-term instrument constitute a financing transaction, like the payment of a trade debt deferred beyond normal business terms or in case of an out-right short-term loan that is not at market rate, the financial asset or liability is measured, initially at the present value of future cash flows discounted at a market rate of interest for a similar debt instrument and subsequently at amortised cost, unless it qualifies as a loan from a director in the case of a small company, or a public benefit entity concessionary loan.

Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the Consolidated Statement of Comprehensive Income.

Financial assets and liabilities are offset and the net amount reported in the Balance Sheet when there is an 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.

Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or income as appropriate. The company does not currently apply hedge accounting for interest rate and foreign exchange derivatives.

Page 26

 
GCUK OWNER LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021

3.


Judgments in applying accounting policies and key sources of estimation uncertainty

In preparing these financial statements, the directors have made a judgement in relation to the valuation of the hotel in property, plant and equipment.
The property is held at fair value based on the directors' conclusions having assessed the valuations completed by independent valuers who hold recognised and relevant professional qualifications. Where an external valuation cannot be obtained, a director's valuation will be used instead. The exception to this is when purchases are part of a recognised refurbishment period; these are held at cost until they reach a stage of operation.
The Group has a policy of capitalising all costs it deems necessary to operate the hotel for its intended purpose. Pre-opening expenditure relates to costs directly attributable to operational activities and has been depreciated over a period of 1 year and 1 day.
The directors have also made a judgement in relation to the valuation of the OTC call option in debtors.
The option is held at fair value based on the directors' conclusions having assessed the valuations completed by independent valuers who hold recognised and relevant professional qualifications.


4.


Turnover

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


2021
2020
£
£

Room sales
1,114,890
1,328,487

Food and beverage sales
604,448
495,046

Retail sales
105,727
93,416

Parking sales
53,277
122,690

1,878,342
2,039,639


All turnover arose within the United Kingdom.


5.


Other operating income

2021
2020
£
£

Government grants receivable
-
338,340


Page 27

 
GCUK OWNER LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021

6.


Operating loss

The operating loss is stated after charging:

2021
2020
£
£

Exchange differences
(969)
-

FX hedge unrealized loss
215,045
49,827

Other operating lease rentals
400,189
401,301


7.


Auditors' remuneration

During the year, the Group obtained the following services from the Company's auditors:


2021
2020
£
£

Fees payable to the Company's auditors for the audit of the consolidated and parent Company's financial statements
57,500
56,400

Fees payable to the Company's auditor in respect of bookkeeping services
52,000
56,000

Taxation compliance services
18,000
18,000


8.


Employees

Staff costs were as follows:


Group
Group
Company
Company
2021
2020
2021
2020
£
£
£
£


Wages and salaries
1,064,316
1,406,765
-
-

Cost of defined contribution scheme
38,425
6,281
-
-

1,102,741
1,413,046
-
-


The average monthly number of group employees, including the directors, during the year was as follows:


        2021
        2020
            No.
            No.







Employees
42
66

Page 28

 
GCUK OWNER LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021

9.


Interest receivable

2021
2020
£
£


Other interest receivable
-
6


10.


Interest payable and similar expenses

2021
2020
£
£


Other loan interest payable
1,420,865
1,521,907


11.


Taxation


2021
2020
£
£



Deferred tax


Origination and reversal of timing differences
252,766
(1,223,167)


Factors affecting tax charge for the year

The tax assessed for the year is higher than (2020 - higher than) the standard rate of corporation tax in the UK of 19% (2020 - 19%). The differences are explained below:

2021
2020
£
£


Loss on ordinary activities before tax
(5,152,934)
(9,821,213)


Loss on ordinary activities multiplied by standard rate of corporation tax in the UK of 19% (2020 - 19%)
(979,057)
(1,866,030)

Effects of:


Non-tax deductible amortisation of goodwill and impairment
-
950,772

Expenses not deductible for tax purposes, other than goodwill amortisation and impairment
20,550
33,246

Qualifying depreciation in excess of capital allowances
(454,792)
-

Adjustments to tax charge in respect of prior periods
537,373
(732,471)

Deferred tax asset on loss not recognised
-
391,316

Unrelieved tax losses carried forward
1,128,692
-

Total tax charge for the year
252,766
(1,223,167)

Page 29

 
GCUK OWNER LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
 
11.Taxation (continued)


Factors that may affect future tax charges

The Chancellor confirmed that the main corporation tax rate would increase to 25% as enacted on 11th March in the Finance Act 2021. This has come into effect in April 2023.


12.


Intangible assets

Group





Goodwill

£



Cost


At 1 January 2021
76,342


Disposals
(76,342)



At 31 December 2021

-



Accumulated amortisation


At 1 January 2021
76,342


On disposals
(76,342)



At 31 December 2021

-



Net book value



At 31 December 2021
-



At 31 December 2020
-

Goodwill relates to the purchase of GCUK Propco Limited and is being amortised over the period of the lease of the hotel property.



Page 30

 
GCUK OWNER LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021

13.


Tangible fixed assets

Group






Long-term leasehold property
Pre-opening expenditure
Fixtures and fittings
Computer equipment
Works in progress
Total

£
£
£
£
£
£



Cost or valuation


At 1 January 2021
62,730,224
-
-
-
3,632,705
66,362,929


Additions
10,267,328
545,191
1,839,600
240,362
1,123,199
14,015,680


Transfers between classes
1,468,313
140,717
1,993,070
30,605
(3,632,705)
-


Revaluations
(865,865)
-
-
-
-
(865,865)



At 31 December 2021

73,600,000
685,908
3,832,670
270,967
1,123,199
79,512,744



Depreciation


At 1 January 2021
6,730,224
-
-
-
-
6,730,224


Charge for the year
609,090
260,507
164,606
33,223
-
1,067,426


On revalued assets
(7,339,314)
-
-
-
-
(7,339,314)



At 31 December 2021

-
260,507
164,606
33,223
-
458,336



Net book value



At 31 December 2021
73,600,000
425,401
3,668,064
237,744
1,123,199
79,054,408



At 31 December 2020
56,000,000
-
-
-
3,632,705
59,632,705

The fair value of the hotel was determined by the directors via a discounted future cashflow on an open
market for existing use basis.

Page 31

 
GCUK OWNER LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021

           13.Tangible fixed assets (continued)

If the long-term leasehold property had not been included at valuation they would have been included under the historical cost convention as follows:

2021
2020
£
£

Group


Cost
51,358,331
43,255,395

Accumulated depreciation
(4,556,711)
(3,990,695)

Net book value
46,801,620
39,264,700

Charges 
Security is in place on the Graduate Hotel in case of default on a loan held by the Company. There were no defaults in the current or previous year.

Page 32

 
GCUK OWNER LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021

14.


Fixed asset investments

Company





Investments in subsidiary companies

£



Cost or valuation


At 1 January 2021
69,495,995



At 31 December 2021

69,495,995



Impairment


At 1 January 2021
13,495,995



At 31 December 2021

13,495,995



Net book value



At 31 December 2021
56,000,000



At 31 December 2020
56,000,000


Subsidiary undertaking


The following was a subsidiary undertaking of the Company:

Name

Registered office

Class of shares

Holding

GCUK Propco Limited (formerly GCUK Operator Limited)
54 Portland Place, London, England, W1B 1DY
Ordinary
100%

The Company's Investment in GCUK Propco Limited is a direct ownership.
The Company has provided GCUK Propco Limited, registration number 06418183, with a parental guarantee in accordance with section 479C of the Companies Act 2006. As such, advantage has been taken of the audit exemption available to GCUK Owner Limited conferred by Section 479A of the Companies Act 2006 relating to the audit of their individual statements.

Page 33

 
GCUK OWNER LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021

15.


Debtors

Group
Group
Company
Company
2021
2020
2021
2020
£
£
£
£

Due after more than one year

Financial instruments
421,119
636,164
421,119
636,164


Group
Group
Company
Company
2021
2020
2021
2020
£
£
£
£

Due within one year

Trade debtors
364,179
17,025
-
-

Amounts owed by group undertakings
-
-
20,430,677
18,726,532

Other taxation and social security
1,241,977
464,917
-
-

Prepayments and accrued income
268,552
123,527
-
-

1,874,708
605,469
20,430,677
18,726,532



16.


Cash and cash equivalents

Group
Group
2021
2020
£
£

Cash at bank and in hand
1,053,856
16,257,948

Less: bank overdrafts
(25)
-

1,053,831
16,257,948


Page 34

 
GCUK OWNER LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021

17.


Creditors: Amounts falling due within one year

Group
Group
Company
Company
2021
2020
2021
2020
£
£
£
£

Bank overdrafts
25
-
-
-

Trade creditors
1,549,990
1,364,294
-
-

Amounts owed to group undertakings
25,019,792
21,718,735
25,019,790
21,718,735

Other creditors
63,815
33,946
-
-

Accruals and deferred income
535,933
591,060
265,899
258,106

27,169,555
23,708,035
25,285,689
21,976,841


Amounts owed to group undertakings are unsecured, bear no interest, and are repayable on demand.


18.


Creditors: Amounts falling due after more than one year

Group
Group
Company
Company
2021
2020
2021
2020
£
£
£
£

Other loans
39,704,029
39,214,259
39,704,029
39,214,259


The other loan is provided by Deutsche Bank AG and is secured on the Graduate Hotel, Cambridge, CB2 1RT. The facility has a drawdown limit of £40,000,000. Interest is charged at 3.4% per annum plus LIBOR. This loan is due for repayment on 14 October 2022.


19.


Financial instruments

Group
Group
Company
Company
2021
2020
2021
2020
£
£
£
£

Financial assets

Financial assets measured at fair value through profit or loss
421,119
636,164
421,119
636,164




Financial assets measured at fair value through profit or loss comprise an OTC call option entered into to protect against the fall of the pound against the US dollar. In the event the hotel is sold, the proceeds will be converted back to US dollars. A loss of £215,045 (2020: £49,827) was recognised in relation to this instrument during the year.

Page 35

 
GCUK OWNER LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021

20.


Deferred taxation


Group



2021
2020


£

£






At beginning of year
(1,493,581)
(4,161,545)


Credited/(debited) in profit or loss
(252,766)
1,223,167


Credited in other comprehensive income
(1,228,877)
1,444,797



At end of year
(2,975,224)
(1,493,581)

The provision for deferred taxation is made up as follows:

Group
Group
2021
2020
£
£

Accelerated capital allowances
(2,800,501)
(792,916)

Deferred tax liability on revaluation surplus
(2,975,224)
(1,746,347)

Tax losses carried forward
2,800,501
1,045,682


21.


Share capital

2021
2020
£
£
Allotted, called up and fully paid



33,826,302 (2020 - 33,826,302) Ordinary shares shares of £0.01 each
338,263
338,263

Ordinary shareholders have the right to receive notice of, and to attend, speak and vote at all general meetings of the Company and shall recieve, vote on and constitute an eligible member for the purposes of all written resolutions of the Company, with the right to cast a vote for each A ordinary share of which they are the holder.



22.


Pension commitments

The Group operates a defined contributions pension scheme. The assets of the scheme are held
separately from those of the Group in an independently administered fund. The pension cost charge
represents contributions payable by the Group to the fund and amounted to £38,425 (2020: £6,281). Contributions totalling £4,606 (2020: £2,714) were payable to the fund at the balance sheet date.

Page 36

 
GCUK OWNER LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021

23.


Commitments under operating leases

At 31 December 2021 the Group had future minimum lease payments due under non-cancellable operating leases for each of the following periods:


Group
Group
2021
2020
£
£

Not later than 1 year
400,000
400,000

Later than 1 year and not later than 5 years
1,600,000
1,600,000

Later than 5 years
52,298,082
52,698,082

54,298,082
54,698,082

The lease payments recognised as an expense totalled £400,189 in 2021 (2020: £401,301).


24.


Related party transactions

Refer to note 17 for disclosure of the related party transactions. All related party transactions were with
wholly owned companies within the group and are therefore exempt from disclosure under FRS 102
Section 33.1A.


25.


Post balance sheet events

Subsequent to the year-end, the global economy has seen high levels of market volatility in connection with the COVID-19 pandemic. The Group is closely monitoring the latest market developments relating to COVID-19 and its potential impact on the Group. The ultimate impact of the COVID-19 pandemic on the global economy is highly uncertain and the full extent of the economic impact on the financial performance of the Group is as yet unknown. The directors continue to review any developments in the COVID-19 pandemic in the context of the risks presented to the Group’s business.
The Group underwent a legal reorganisation effective 31 December 2022 whereby GCUK Operator Ltd was renamed GCUK PropCo Ltd and entered into a business transfer agreement to sell the business and assets associated with the hotel operations to GCUK OpCo Ltd, a newly-formed entity. GCUK PropCo continues to hold the real estate interests of the hotel property. Both entities share common ownership and consolidate into GCUK Owner Ltd.
The Deutsche Bank loan due for repayment on 14 October 2022 was extended through February 2023. In conjunction with the extension, the Company entered into a new credit facility agreement with ENIV totaling £44.5m at an interest rate of 4.50% per annum plus six-month forecast compounded SONIA. A portion of the proceeds were used to fully payoff the £40.0m existing loan with Deutsche Bank. 
The events noted above are considered non-adjusting post-balance sheet events. 

Page 37

 
GCUK OWNER LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021

26.


Controlling party

The directors consider that the ultimate controlling party and ultimate parent undertaking of the Company
is Graduate Hotels Real Estate Fund III LP (Delaware), headquartered in the United States. This is the
largest group to draw up consolidated financial statements, which are available at the company’s address: 133 North Jefferson Street, 4th Floor, Chicago, Illinois, 60661.

 
Page 38