Company registration number 12963039 (England and Wales)
HIGHTOWER FINANCE LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
HIGHTOWER FINANCE LIMITED
COMPANY INFORMATION
Directors
S A J Nahum
E M Sawyer
Company number
12963039
Registered office
4th Floor Millbank Tower
21-24 Millbank
London
SW1P 4QP
Auditor
Gerald Edelman LLP
73 Cornhill
London
EC3V 3QQ
HIGHTOWER FINANCE LIMITED
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3 - 4
Independent auditor's report
5 - 7
Group profit and loss account
8
Group statement of comprehensive income
9
Group balance sheet
10
Company balance sheet
11
Group statement of changes in equity
12
Company statement of changes in equity
13
Group statement of cash flows
14
Company statement of cash flows
15
Notes to the financial statements
16 - 30
HIGHTOWER FINANCE LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2023
- 1 -

The directors present the strategic report for the year ended 31 March 2023.

Review of the business

The financial statements of the Group for the year ended 31 March 2023 present the results and the financial position for the year commencing 1 April 2022. The comparative figures present the results of the Group for the period from 20 October 2020 to 31 March 2022.

 

The group’s operating loss for the year includes £52.2m of net revaluation and impairment losses (2022: £83.6m losses). The full results for the group are shown in the Consolidated Statement of Comprehensive Income on page 8. The reduction in value is considered to be a timing issue and expected to reverse in future when current market conditions improve.

 

The directors continue to review lending opportunities as they arise in keeping with the company’s risk management principles.

 

Principal risks and uncertainties

The directors have identified the need to manage the Group’s material financial risks and, as a result, have adopted various policies across the group. These risks and policies are monitored by the directors on a continuing basis and are discussed below.

 

Profitability risk

The directors place importance on continuous monitoring of the performance of the business, and the credit agreements in issue. Rent reviews are carried out at regular intervals to ensure changes in market conditions are reflected in lease terms and concessions.

 

Through the group’s interest rate risk and due diligence policies, profitability from its lending activities is also managed effectively.

 

Credit risk

The directors place strong emphasis on constantly improving controls over risk including seeking forms of security or guarantees.

 

The covenant strength of potential tenants is assessed on a case by case basis and, as a standard policy, security is obtained in the form of a rental deposit or guarantee where possible. Existing tenants are reviewed on a regular basis to monitor payment and trading patterns.

 

Loans issued by the group are underwritten to reduce any financial or credit risk. Financial covenants such as interest cover ratio (ICR), loan to value (LTV), net operating income (NOI) and timeliness of payments are reviewed regularly to help mitigate risk.

 

Interest rate risk

The group’s long term debt is largely priced at a fixed rate which enables the group to forecast its costs with very little to no risk attributable to changes in base rate. The group regularly reviews its forecasts to ensure that there is sufficient cash available to meet its interest and principal repayments.

 

Where the group extends debt financing to other parties, a base rate is generally applied which is subject to a floor rate set by the directors to ensure a desired minimum return.

 

Liquidity risk

The group’s liquidity position is adequate for the level of business with £9,844,326 of cash and cash equivalents at 31 March 2023 (2022: £23,871,970). The group seeks to manage its liquidity risk by forecasting cashflow and establishing long term financing arrangements to aid its operations and investments for the foreseeable future.

 

Foreign exchange risk

The group is not exposed to foreign exchange risk as all of its income is derived from activities undertaken in the UK and all of its transactions are denominated in sterling.

 

 

HIGHTOWER FINANCE LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 2 -
Key performance indicators

The group uses a variety of KPIs to allow it to monitor the performance of its business and financial model, as well as its wider responsibilities to its shareholders.

 

The group sees EBITDA and rates of return on lending as key KPIs. For the period ended 31 March 2022 the EBITDA of the group was £4.4m profit (2022: £61.9m loss), with a £32.1m profit (2022: £21.7m profit) when adjusting for the effects of property revaluation.

 

The group reviews its trade debtor position on a weekly and monthly basis to effectively manage the credit risk and have installed a number of debt collection metrics. At 31 March 2023 trade debt was £9.6m (2022: £9.3m) and is considered satisfactory.

Customers

We have worked hard with customers to provide cashflow solutions to alleviate some of the burdens that the pandemic presented to their underlying businesses, in order to maintain our relationships with tenants who lease premises on normal credit terms, whilst remaining fair to all other stakeholders.

 

The group maintains high levels of due diligence and performs regular reviews of the economic factors affecting the financing markets to ensure limitation of the group’s risks from its debt financing activities.

Other information and explanations

The group is committed to the goals of environmental sustainability and accountability. We are conscious of our operating environment and the effect our activities can have on neighbouring communities. There are appropriate environmental policies and waste disposal contracts in place. Where appropriate, subsidiaries participate in the Energy Savings Opportunity Scheme (ESOS).

Promoting the success of the company

Considering the interest of all of our stakeholders is an important part of the way in which we conduct our business and underpins the methodology used in all key decisions, considering and balancing all perspectives.

 

The directors have continued to invest in development of the group's property portfolio to ensure it continues to bring in revenue. Within the period, additions to investment property totalled £92.7m (2022: £66.6m). Where a property becomes vacant, an assessment is made of the site with a view to obtaining the optimum shareholder return either through the generation of rental income or capital appreciation. The company undertakes a comprehensive review including an assessment of alternative use or disposal, if deemed appropriate.

 

The group's operations continue to qualify as low energy, as disclosed in the energy and carbon report, minimising its impact on the environment.

 

The group endeavours to uphold high standards of operations and business conduct and will continue to act fairly between members of the group.

On behalf of the board

S A J Nahum
Director
2 April 2024
HIGHTOWER FINANCE LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2023
- 3 -

The directors present their annual report and financial statements for the year ended 31 March 2023.

Principal activities

The principal activity of the company is that of financial activities and investment. The company was incorporated on 20 October 2020 and commenced to trade from that date. The directors confirm that the company remains a going concern and is expected to continue this principal activity for the foreseeable future.

Results and dividends

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

No ordinary dividends were paid. The directors do not recommend payment of a further dividend.

Directors

The directors who held office during the year and up to the date of signature of the financial statements were as follows:

S A J Nahum
E M Sawyer
Business relationships

The effects of a significant rise in interest rates, inflation and the cost-of-living crisis have impacted a number of tenants’ and borrowers’ abilities to pay. As a result, bad debts have increased during the period and continue to be reviewed post year end.

 

We have continued to work hard with customers to provide cashflow solutions to alleviate some of the burdens that the current economy has presented to their underlying businesses, in order to maintain our relationships with tenants who lease premises on normal credit terms, whilst remaining fair to all other stakeholders.

 

The group maintains high levels of due diligence and performs regular reviews of the economic factors affecting the financing markets to ensure limitation of the group’s risks from its debt financing activities.

 

Our suppliers are also central to our business, and we continually strive to improve our processes and build stronger relationships with them.

 

We balance the benefits of maintaining strategic relationships with our key suppliers alongside the need to obtain the highest value for money for our customers.

Auditor

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

Energy and carbon report

As the group has not consumed more than 40,000 kWh of energy in this reporting period, it qualifies as a low energy user under these regulations and is not required to report on its emissions, energy consumption or energy efficiency activities.

HIGHTOWER FINANCE LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 4 -
Statement of directors' responsibilities

The directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulations.

 

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the group and company, and of the profit or loss of the group for that period. In preparing these financial statements, the directors are required to:

 

 

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

Statement of disclosure to auditor

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the auditor of the company is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the auditor of the company is aware of that information.

Going concern

At the time of approving the financial statements, the directors have a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

On behalf of the board
S A J Nahum
Director
2 April 2024
2024-04-02
HIGHTOWER FINANCE LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF HIGHTOWER FINANCE LIMITED
- 5 -
Opinion

We have audited the financial statements of Hightower Finance Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 March 2023 which comprise the group profit and loss account, the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows, the company statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including 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:

Basis for opinion

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

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

 

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the group's and parent company’s ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

 

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

Other information

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

 

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

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

HIGHTOWER FINANCE LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF HIGHTOWER FINANCE LIMITED
- 6 -
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 their environment obtained in the course of the audit, we have not identified material misstatements in the 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:

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the parent company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the parent company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

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

The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

Extent to which the audit was considered capable of detecting irregularities, including fraud

In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, our procedures included the following:

HIGHTOWER FINANCE LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF HIGHTOWER FINANCE LIMITED
- 7 -
Audit response to risks identified

To address the risk of fraud through management bias and override of controls, we:

Irregularities and non-compliance with laws and regulations

In response to the risk of irregularities and non compliance with laws and regulations, we designed procedures which included, but are not limited to:

The test nature and other inherent limitations of an audit, together with the inherent limitations of any accounting and internal control system, mean that there is an unavoidable risk that even some material misstatements in respect of irregularities may remain undiscovered even though the audit is properly planned and performed in accordance with ISAs (UK). Furthermore, the more removed that laws and regulations are from financial transactions, the less likely that we would become aware of non-compliance.

 

Our examination should therefore not be relied upon to disclose all such material misstatements or frauds, errors or instances of non-compliance that might exist. The responsibility for safeguarding the assets of the company and for the prevention and detection of fraud, error and non-compliance with law or regulations rests with the directors.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

Use of our report

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

Stephen Coleman ACA (Senior Statutory Auditor)
For and on behalf of Gerald Edelman LLP
2 April 2024
Chartered Accountants
Statutory Auditor
73 Cornhill
London
EC3V 3QQ
HIGHTOWER FINANCE LIMITED
GROUP PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 MARCH 2023
- 8 -
Year
Period
ended
ended
31 March
31 March
2023
2022
Notes
£
£
Turnover
3
48,772,441
42,589,063
Cost of sales
(13,739,708)
(20,762,258)
Gross profit
35,032,733
21,826,805
Administrative expenses
(6,439,151)
(6,364,429)
Operating profit
4
28,593,582
15,462,376
Interest receivable and similar income
7
145,166
2,532
Interest payable and similar expenses
8
(29,215,595)
(37,316,321)
Fair value loss on investment property
12
(27,541,098)
(83,567,673)
Impairment of goodwill
(24,677,255)
-
0
Loss before taxation
(52,695,200)
(105,419,086)
Tax on loss
9
8,801,445
(7,873,939)
Loss for the financial year
(43,893,755)
(113,293,025)
Loss for the financial year is all attributable to the owners of the parent company.
HIGHTOWER FINANCE LIMITED
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2023
- 9 -
Year
Period
ended
ended
31 March
31 March
2023
2022
£
£
Loss for the year
(43,893,755)
(113,293,025)
Other comprehensive income
-
-
Total comprehensive income for the year
(43,893,755)
(113,293,025)
Total comprehensive income for the year is all attributable to the owners of the parent company.
HIGHTOWER FINANCE LIMITED
GROUP BALANCE SHEET
AS AT
31 MARCH 2023
31 March 2023
- 10 -
2023
2022
Notes
£
£
£
£
Fixed assets
Goodwill
10
26,073,134
54,009,531
Tangible assets
11
119,846
6,134,996
Investment property
12
680,167,265
607,265,037
706,360,245
667,409,564
Current assets
Debtors
15
363,334,659
271,796,036
Cash at bank and in hand
9,844,326
23,871,970
373,178,985
295,668,006
Creditors: amounts falling due within one year
16
(464,514,427)
(387,851,477)
Net current liabilities
(91,335,442)
(92,183,471)
Total assets less current liabilities
615,024,803
575,226,093
Creditors: amounts falling due after more than one year
17
(539,728,426)
(447,234,516)
Provisions for liabilities
Deferred tax liability
19
-
0
8,801,445
-
(8,801,445)
Net assets
75,296,377
119,190,132
Capital and reserves
Called up share capital
20
232,483,157
232,483,157
Profit and loss reserves
(157,186,780)
(113,293,025)
Total equity
75,296,377
119,190,132
The financial statements were approved by the board of directors and authorised for issue on 2 April 2024 and are signed on its behalf by:
02 April 2024
S A J Nahum
Director
Company registration number 12963039 (England and Wales)
HIGHTOWER FINANCE LIMITED
COMPANY BALANCE SHEET
AS AT 31 MARCH 2023
31 March 2023
- 11 -
2023
2022
Notes
£
£
£
£
Fixed assets
Investments
13
15
24,677,270
Current assets
Debtors
15
622,912,959
648,442,266
Cash at bank and in hand
1,015,102
2,351,142
623,928,061
650,793,408
Creditors: amounts falling due within one year
16
(352,284,157)
(412,941,703)
Net current assets
271,643,904
237,851,705
Net assets
271,643,919
262,528,975
Capital and reserves
Called up share capital
20
232,483,157
232,483,157
Profit and loss reserves
39,160,762
30,045,818
Total equity
271,643,919
262,528,975

As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £9,114,944 (2022 - £30,045,818 profit).

The financial statements were approved by the board of directors and authorised for issue on 2 April 2024 and are signed on its behalf by:
02 April 2024
S A J Nahum
Director
Company registration number 12963039 (England and Wales)
HIGHTOWER FINANCE LIMITED
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2023
- 12 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 20 October 2020
-
0
-
0
-
Period ended 31 March 2022:
Loss and total comprehensive income
-
(113,293,025)
(113,293,025)
Issue of share capital
20
232,483,157
-
232,483,157
Balance at 31 March 2022
232,483,157
(113,293,025)
119,190,132
Year ended 31 March 2023:
Loss and total comprehensive income
-
(43,893,755)
(43,893,755)
Balance at 31 March 2023
232,483,157
(157,186,780)
75,296,377
HIGHTOWER FINANCE LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2023
- 13 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 20 October 2020
-
0
-
0
-
Period ended 31 March 2022:
Profit and total comprehensive income for the period
-
30,045,818
30,045,818
Issue of share capital
20
232,483,157
-
232,483,157
Balance at 31 March 2022
232,483,157
30,045,818
262,528,975
Year ended 31 March 2023:
Profit and total comprehensive income
-
9,114,944
9,114,944
Balance at 31 March 2023
232,483,157
39,160,762
271,643,919
HIGHTOWER FINANCE LIMITED
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2023
- 14 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
24
16,786,833
137,703,434
Interest paid
(29,215,595)
(37,316,321)
Income taxes refunded
-
0
927,506
Net cash (outflow)/inflow from operating activities
(12,428,762)
101,314,619
Investing activities
Purchase of tangible fixed assets
(45,211)
(6,319,554)
Purchase of investment property
(94,669,173)
(690,832,710)
Purchase of subsidiaries, net of goodwill
-
(60,010,590)
Interest received
145,166
2,532
Net cash used in investing activities
(94,569,218)
(757,160,322)
Financing activities
Proceeds from issue of shares
-
232,483,157
Repayment of borrowings
92,493,910
447,234,516
Net cash generated from financing activities
92,493,910
679,717,673
Net (decrease)/increase in cash and cash equivalents
(14,504,070)
23,871,970
Cash and cash equivalents at beginning of year
23,871,970
-
0
Cash and cash equivalents at end of year
9,367,900
23,871,970
Relating to:
Cash at bank and in hand
9,844,326
23,871,970
Bank overdrafts included in creditors payable within one year
(476,426)
-
HIGHTOWER FINANCE LIMITED
COMPANY STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2023
- 15 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash absorbed by operations
25
(1,348,784)
(205,454,745)
Investing activities
Purchase of subsidiaries
-
0
(24,677,270)
Interest received
12,744
-
0
Net cash generated from/(used in) investing activities
12,744
(24,677,270)
Financing activities
Proceeds from issue of shares
-
232,483,157
Net cash (used in)/generated from financing activities
-
232,483,157
Net (decrease)/increase in cash and cash equivalents
(1,336,040)
2,351,142
Cash and cash equivalents at beginning of year
2,351,142
-
0
Cash and cash equivalents at end of year
1,015,102
2,351,142
HIGHTOWER FINANCE LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
- 16 -
1
Accounting policies
Company information

Hightower Finance Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is 4th Floor Millbank Tower, 21-24 Millbank, London, SW1P WQP.

 

The group consists of Hightower Finance Limited and all of its subsidiaries.

1.1
Reporting period

These accounts are for the year ending 31 March 2023. The comparative figures are for the period of account from incorporation to 31 March 2022.

1.2
Accounting convention

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention, modified to include the revaluation of freehold properties and to include investment properties and certain financial instruments at fair value. The principal accounting policies adopted are set out below.

1.3
Business combinations

In the parent company financial statements, the cost of a business combination is the fair value at the acquisition date of the assets given, equity instruments issued and liabilities incurred or assumed, plus costs directly attributable to the business combination. The excess of the cost of a business combination over the fair value of the identifiable assets, liabilities and contingent liabilities acquired is recognised as goodwill. The cost of the combination includes the estimated amount of contingent consideration that is probable and can be measured reliably, and is adjusted for changes in contingent consideration after the acquisition date. Provisional fair values recognised for business combinations in previous periods are adjusted retrospectively for final fair values determined in the 12 months following the acquisition date. Investments in subsidiaries, joint ventures and associates are accounted for at cost less impairment.

 

Deferred tax is recognised on differences between the value of assets (other than goodwill) and liabilities recognised in a business combination accounted for using the purchase method and the amounts that can be deducted or assessed for tax, considering the manner in which the carrying amount of the asset or liability is expected to be recovered or settled. The deferred tax recognised is adjusted against goodwill or negative goodwill.

1.4
Basis of consolidation

The consolidated group financial statements consist of the financial statements of the parent company Hightower Finance Limited together with all entities controlled by the parent company (its subsidiaries) and the group’s share of its interests in joint ventures and associates.

 

All financial statements are made up to 31 March 2023. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.

 

All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.

Subsidiaries are consolidated in the group’s financial statements from the date that control commences until the date that control ceases.

HIGHTOWER FINANCE LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 17 -

Entities in which the group holds an interest and which are jointly controlled by the group and one or more other venturers under a contractual arrangement are treated as joint ventures. Entities other than subsidiary undertakings or joint ventures, in which the group has a participating interest and over whose operating and financial policies the group exercises a significant influence, are treated as associates.

Investments in joint ventures and associates are carried in the group balance sheet at cost plus post-acquisition changes in the group’s share of the net assets of the entity, less any impairment in value. The carrying values of investments in joint ventures and associates include acquired goodwill.

 

If the group’s share of losses in a joint venture or associate equals or exceeds its investment in the joint venture or associate, the group does not recognise further losses unless it has incurred obligations to do so or has made payments on behalf of the joint venture or associate.

 

Unrealised gains arising from transactions with joint ventures and associates are eliminated to the extent of the group’s interest in the entity.

1.5
Going concern

At the time of approving the financial statements, the directors have a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

1.6
Turnover

Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.

 

When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income.

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

1.7
Intangible fixed assets - goodwill

Goodwill represents the excess of the cost of acquisition of a business over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is 10 years.

 

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

1.8
Tangible fixed assets

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

HIGHTOWER FINANCE LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 18 -

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Plant and equipment
25%

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in the profit and loss account.

1.9
Investment property

Investment property, which is property held to earn rentals and/or for capital appreciation, is initially recognised at cost, which includes the purchase cost and any directly attributable expenditure. Subsequently it is measured at fair value at the reporting end date. Changes in fair value are recognised in profit or loss.

 

1.10
Fixed asset investments

Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available.

 

In the parent company financial statements, investments in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.

A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The group considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.

 

Investments in associates are initially recognised at the transaction price (including transaction costs) and are subsequently adjusted to reflect the group’s share of the profit or loss, other comprehensive income and equity of the associate using the equity method. Any difference between the cost of acquisition and the share of the fair value of the net identifiable assets of the associate on acquisition is recognised as goodwill. Any unamortised balance of goodwill is included in the carrying value of the investment in associates.

 

Losses in excess of the carrying amount of an investment in an associate are recorded as a provision only when the company has incurred legal or constructive obligations or has made payments on behalf of the associate.

 

In the parent company financial statements, investments in associates are accounted for at cost less impairment.

Entities in which the group has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.

HIGHTOWER FINANCE LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 19 -
1.11
Impairment of fixed assets

At each reporting period end date, the group reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

 

The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

 

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

1.12
Cash and cash equivalents

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

1.13
Financial instruments

The group has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

 

Financial instruments are recognised in the group's balance sheet when the group becomes party to the contractual provisions of the instrument.

 

Financial assets and liabilities are offset and the net amounts presented in the financial statements when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

HIGHTOWER FINANCE LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 20 -
Impairment of financial assets

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

 

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

 

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

Derecognition of financial assets

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the group transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

Classification of financial liabilities

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

Basic financial liabilities

Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

 

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

 

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Derecognition of financial liabilities

Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.

1.14
Equity instruments

Equity instruments issued by the group are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the group.

1.15
Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

HIGHTOWER FINANCE LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 21 -
Current tax

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

 

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset if, and only if, there is a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

1.16
Employee benefits

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

 

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

 

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

2
Judgements and key sources of estimation uncertainty

In the application of the group’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

 

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

HIGHTOWER FINANCE LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 22 -
3
Turnover and other revenue
2023
2022
£
£
Turnover analysed by class of business
Interest
15,513,576
9,671,746
Rent
27,757,472
30,326,719
Other
5,501,393
2,590,598
48,772,441
42,589,063
2023
2022
£
£
Other revenue
Interest income
145,166
2,532

Income is derived solely in the UK.

4
Operating profit
2023
2022
£
£
Operating profit for the year is stated after charging:
Depreciation of owned tangible fixed assets
153,033
184,558
Amortisation of intangible assets
3,259,142
6,001,059
Impairment of intangible assets
24,677,255
-
0
5
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the group and company
24,000
20,000
Audit of the financial statements of the company's subsidiaries
25,350
12,252
49,350
32,252
6
Employees

The average monthly number of persons (including directors) employed by the group and company during the year was:

Group
Company
2023
2022
2023
2022
Number
Number
Number
Number
Total
-
-
-
0
-
0
HIGHTOWER FINANCE LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 23 -
7
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
145,166
2,532
2023
2022
Investment income includes the following:
£
£
Interest on financial assets not measured at fair value through profit or loss
145,166
2,532
8
Interest payable and similar expenses
2023
2022
£
£
Interest on financial liabilities measured at amortised cost:
Other interest on financial liabilities
29,215,595
37,316,321
9
Taxation
2023
2022
£
£
Deferred tax
Origination and reversal of timing differences
(8,801,445)
7,873,939

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

2023
2022
£
£
Loss before taxation
(52,695,200)
(105,419,086)
Expected tax credit based on the standard rate of corporation tax in the UK of 19.00% (2022: 19.00%)
(10,012,088)
(20,029,626)
Tax effect of expenses that are not deductible in determining taxable profit
593,934
12,437,556
Tax effect of utilisation of tax losses not previously recognised
9,919,941
(2,823,427)
Effect of change in corporation tax rate
(2,112,347)
222,601
Group relief
(501,787)
2,411,579
Effect of fair value movements
(6,689,098)
15,655,256
Taxation (credit)/charge
(8,801,445)
7,873,939
HIGHTOWER FINANCE LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 24 -
10
Intangible fixed assets
Group
Goodwill
£
Cost
At 1 April 2022 and 31 March 2023
60,010,590
Amortisation and impairment
At 1 April 2022
6,001,059
Amortisation charged for the year
3,259,142
Impairment losses
24,677,255
At 31 March 2023
33,937,456
Carrying amount
At 31 March 2023
26,073,134
At 31 March 2022
54,009,531
The company had no intangible fixed assets at 31 March 2023 or 31 March 2022.

More information on impairment movements in the year is given in note .

11
Tangible fixed assets
Group
Plant and equipment
£
Cost
At 1 April 2022
6,319,554
Additions
45,211
Transfers
(5,907,328)
At 31 March 2023
457,437
Depreciation and impairment
At 1 April 2022
184,558
Depreciation charged in the year
153,033
At 31 March 2023
337,591
Carrying amount
At 31 March 2023
119,846
At 31 March 2022
6,134,996
The company had no tangible fixed assets at 31 March 2023 or 31 March 2022.
HIGHTOWER FINANCE LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 25 -
12
Investment property
Group
Company
2023
2023
£
£
Fair value
At 1 April 2022 and 31 March 2023
607,265,037
-
Additions through external acquisition
94,669,173
-
Reclassification
5,774,153
-
Net gains or losses through fair value adjustments
(27,541,098)
-
At 31 March 2023
680,167,265
-

The fair value of the investment property has been arrived at on the basis of a valuation carried out by the Directors with reference to an underlying valuation at the balance sheet date. The valuation was made on an open market value basis by reference to market evidence of transaction prices for similar properties.

13
Fixed asset investments
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Investments in subsidiaries
14
-
0
-
0
15
24,677,270
Movements in fixed asset investments
Company
Shares in subsidiaries
£
Cost or valuation
At 1 April 2022
24,677,270
Valuation changes
(24,677,255)
At 31 March 2023
15
Carrying amount
At 31 March 2023
15
At 31 March 2022
24,677,270
HIGHTOWER FINANCE LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 26 -
14
Subsidiaries

Details of the company's subsidiaries at 31 March 2023 are as follows:

Name of undertaking
Registered office
Class of
% Held
shares held
Direct
Blaydon Properties Limited
British Virgin Islands
Ordinary
100.00
Eden Commercial Limited
British Virgin Islands
Ordinary
100.00
Edenrise Properties Limited
British Virgin Islands
Ordinary
100.00
Gosforth Properties Limited
British Virgin Islands
Ordinary
100.00
Ivybridge Properties Limited
British Virgin Islands
Ordinary
100.00
Jubilee House Limited
British Virgin Islands
Ordinary
100.00
Kendal Estates Limited
British Virgin Islands
Ordinary
100.00
Lucian Properties Limited
British Virgin Islands
Ordinary
100.00
Millbank Tower Limited
British Virgin Islands
Ordinary
100.00
Primal Properties Limited
British Virgin Islands
Ordinary
100.00
Sudervest Limited
British Virgin Islands
Ordinary
100.00
Taras Properties Limited
British Virgin Islands
Ordinary
100.00
Vengada Estates Limited
British Virgin Islands
Ordinary
100.00
Winmark Asia Limited
British Virgin Islands
Ordinary
100.00
Zelton International Corp.
British Virgin Islands
Ordinary
100.00
Prebroadacre Limited
England & Wales
Ordinary
100.00
Reuben Brothers (Newcastle) Limited
England & Wales
Ordinaty
100.00
Millbank Tower Limited
England and Wales
Ordinary
100.00

The Registered Offices of the British Virgin Island companies are 2nd Floor, O'Neal Marketing Associates Building, P O Box 3174, Wickham's Cay II, Road Town, Tortola BVI. The UK companies are at 4th Floor Millbank Tower, 21-24 Millbank, London, SW1P 4QP.

15
Debtors
Group
Company
2023
2022
2023
2022
Amounts falling due within one year:
£
£
£
£
Trade debtors
9,435,876
9,281,763
-
0
-
0
Other debtors
48,830,581
26,143,427
31,419,834
10,515,304
Prepayments and accrued income
4,745,814
8,712,358
-
0
-
0
63,012,271
44,137,548
31,419,834
10,515,304
Amounts falling due after more than one year:
Other debtors
300,322,388
227,658,488
591,493,125
637,926,962
Total debtors
363,334,659
271,796,036
622,912,959
648,442,266
HIGHTOWER FINANCE LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 27 -
16
Creditors: amounts falling due within one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Bank loans and overdrafts
18
476,426
-
0
-
0
-
0
Trade creditors
9,629,976
9,259,405
-
0
-
0
Amounts owed to group undertakings
351,032,281
315,546,934
351,032,281
411,824,315
Other creditors
96,640,744
57,810,752
-
0
-
0
Accruals and deferred income
6,735,000
5,234,386
1,251,876
1,117,388
464,514,427
387,851,477
352,284,157
412,941,703

There are no specific terms of interest or repayment attached to the amounts owed to group undertakings.

17
Creditors: amounts falling due after more than one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Other borrowings
18
539,728,426
447,234,516
-
0
-
0
18
Borrowings
Group
Company
2023
2022
2023
2022
£
£
£
£
Bank overdrafts
476,426
-
0
-
0
-
0
Other loans
539,728,426
447,234,516
-
0
-
0
540,204,852
447,234,516
-
-
Payable within one year
476,426
-
0
-
0
-
0
Payable after one year
539,728,426
447,234,516
-
0
-
0

The long-term loans are secured by fixed charges over the group's investments. The loans are interest bearing and due on 31 March 2027.

HIGHTOWER FINANCE LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 28 -
19
Deferred taxation

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

Liabilities
Liabilities
2023
2022
Group
£
£
Investment property
-
8,801,445
The company has no deferred tax assets or liabilities.
Group
Company
2023
2023
Movements in the year:
£
£
Liability at 1 April 2022
8,801,445
-
Credit to profit or loss
(8,801,445)
-
Asset at 31 March 2023
-
-
20
Share capital
Group and company
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
232,483,157
232,483,157
232,483,157
232,483,157
21
Operating lease commitments
Lessor

At the reporting end date the group had contracted with tenants for the following minimum lease payments:

Group
Company
2023
2022
2023
2022
£
£
£
£
Within one year
41,627,211
32,099,641
-
-
Between two and five years
86,983,038
100,290,741
-
-
In over five years
107,832,416
129,076,559
-
-
236,442,665
261,466,941
-
-
HIGHTOWER FINANCE LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 29 -
22
Related party transactions

The company has taken advantage of the exemption under terms of FRS102 not to disclose related party transactions with wholly owned subsidiaries within the group.

 

Included in other creditors is an amount of £32,057,513 (2022: £29,526,224) due to Aldersgate Investments Limited, a company registered in the British Virgin Islands under common control. There are no specific terms of interest or repayment attached to this amount.

 

23
Controlling party and Ultimate controlling party

The company's immediate parent company is Stamford Group Holdings Limited, a company incorporated in the British Virgin Islands, by virtue of its 100% ownership of the company's share capital. The ultimate parent company is Hightower Investments Corp, a company incorporated in the British Virgin Islands.

 

24
Cash generated from group operations
2023
2022
£
£
Loss for the year after tax
(43,893,755)
(113,293,025)
Adjustments for:
Taxation (credited)/charged
(8,801,445)
7,873,939
Finance costs
29,215,595
37,316,321
Investment income
(145,166)
(2,532)
Impairment loss
24,677,255
-
0
Fair value loss on investment properties
27,541,098
83,567,673
Amortisation and impairment of intangible assets
3,259,142
6,001,059
Depreciation and impairment of tangible fixed assets
153,033
184,558
Net transfers
133,175
-
Movements in working capital:
Increase in debtors
(91,538,623)
(271,796,036)
Increase in creditors
76,186,524
387,851,477
Cash generated from operations
16,786,833
137,703,434
HIGHTOWER FINANCE LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 30 -
25
Cash absorbed by operations - company
2023
2022
£
£
Profit for the year after tax
9,114,944
30,045,818
Adjustments for:
Investment income
(12,744)
-
0
Impairment of investment
24,677,255
-
0
Movements in working capital:
Decrease/(increase) in debtors
25,529,307
(648,442,266)
(Decrease)/increase in creditors
(60,657,546)
412,941,703
Cash absorbed by operations
(1,348,784)
(205,454,745)
26
Analysis of changes in net debt - group
1 April 2022
Cash flows
31 March 2023
£
£
£
Cash at bank and in hand
23,871,970
(14,027,644)
9,844,326
Bank overdrafts
-
0
(476,426)
(476,426)
23,871,970
(14,504,070)
9,367,900
Borrowings excluding overdrafts
(447,234,516)
(92,493,910)
(539,728,426)
(423,362,546)
(106,997,980)
(530,360,526)
27
Analysis of changes in net funds - company
1 April 2022
Cash flows
31 March 2023
£
£
£
Cash at bank and in hand
2,351,142
(1,336,040)
1,015,102
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