Registered number:
FOR THE YEAR ENDED 31 MARCH 2024
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SOUTHALL TRAVEL LIMITED
COMPANY INFORMATION
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SOUTHALL TRAVEL LIMITED
CONTENTS
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SOUTHALL TRAVEL LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2024
The directors present their annual report of Southall Travel Limited (“the Company”) for the year ended 31 March 2024.
The Company is required by the Companies Act 2006 to set out a report outlining a fair review of the business of the Company during the financial year ended 31 March 2024. This report will therefore include the position of the Company at the year ended 31 March 2024 and outline the principal risks and uncertainties facing it. The review contained within this report is prepared solely to provide additional information to shareholders to assess the Company's strategies and their potential for success. Please note, this report and business review should not be relied upon by any other party or for any other purpose than stated above.
The Company's immediate parent company is Onkar International Limited, a company incorporated in England and Wales. The principal activity is that of a property development and investment company. The ultimate parent company is ST Holdings Limited, a company incorporated in Guernsey.
The Company’s principal activity is that of a licensed tour operator and travel agency. Established in 1984, the company has since grown into one of the largest travel companies in the UK. It holds an ATOL licence, which allows the company to sell fully consumer protected package holiday arrangements to UK consumers.
We, as Directors of the Company, uphold the professional conduct and obligations as outlined under section 172(1) of the Companies Act 2006 (‘Section 172’). Given our compliance to this code of conduct, we as Directors, act in a way that we consider to most likely to promote the success of the company for the benefit of its members. Our commitment to uphold such professional integrity encompasses the following factors (amongst many other considerations):
-The likely consequences of any decision in the long term. -The interests of the Company’s employees. -The need to foster the Company’s business relationships with suppliers, customers and all other external and internal stakeholders. -The impact of the Company’s operations on the wider community and the environment. -The necessity of the Company to maintain a reputation for high standards of business conduct at all times. -The requirement to act fairly with, and between, members of the Company. We, as Directors of the Company, acting in our capacity as both individual agents and as a collective corporate entity, consider that we have fully discharged our duties in accordance with Section 172, considering the factors listed above in our decisions made during the year. Many of the decisions taken by us (as Directors) during the year relate to supporting the strategic initiatives the company. Additionally, the company have effectively handled the challenges posed by the unpredictable events of the past 24 months.
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SOUTHALL TRAVEL LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
The results for the year and the financial position of the Company are detailed on pages 14 to 28. Despite a period of unparalleled operational and financial challenges management is pleased to report the Company’s turnover has returned to pre pandemic levels in the year ended 31 March 2024. The company recorded turnover of £514 million (2023: £524 million) and profit before tax of £19 million (2023: £30.7 million). The company has continued to recover towards pre pandemic levels and turnover of £514 million as the Company positioned itself operationally to be ready for the resurgence of travel as the world opened again.
The Company has maintained the high level of customer service that its name has become synonymous with. There are several factors which have contributed to successful trading results: •The company has a proactive approach by quickly adapting its operations to meet changing customer expectations. •It offers innovative quality offerings, such as unique experiences and flexible booking policies, which attracts discerning customers seeking personalized and safe travel experiences. •The company’s brand positioning plays a crucial role to its success. Targeted advertising and effective communication as to the value proposition keeps the company engaged with its target audience. The company has increased marketing and advertising spend by 45% to £9.1 million in comparison with £6.3 million for the year ended 31 March 2023, as a commitment to its continued engagement and brand recognition. •Strategic partnerships in the form of collaborations with airlines, hotels and local service providers allows the company to differentiate in a very competitive market. •The embracing of sustainable practices to align with evolving consumer expectations and promoting responsible tourism and engaging in community development. •Adherence to consumer protection laws and travel regulatory regime in relation to responsible protection of client monies. The company’s cash at year end was in excess of £60 million (2023: £49 million) and this is cash cover of 5 times the customer monies held in advance of travel. This evidences the company’s commitment to consumers monies being fully used for providing their travel arrangements. Despite the challenges posed by the cost-of-living crisis, political landscape and global economy downturn, the company made £19 million pre-tax profit, (2023: £30.7 million). The company faced the challenge of rising direct and operational costs together with fluctuations in the foreign currency exchange rates, resulting in a decrease in its gross profit margin. Reduced consumer spending could have led to decline in travel demand, but the company did not experience this due to continued demand for flights and ATOL protected package holidays returning back to pre-pandemic levels. Customers were willing to allocate funds to facilitate their important family experiences and knew they could trust the company to offer them the best value for money and an excellent level of customer service. The Company is one of the leading travel agents selling flights to the Middle East, Indian subcontinent, USA, and Far East. Our focus is, and will remain, to ensure our cost base continues to be aligned with the revenue capability of all the divisions of the business.
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SOUTHALL TRAVEL LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
The company has strong reserves, including the robust cash reserves, which held the company in good stead to deal with the reduced trading during the pandemic and the large bounce back subsequently. The Company’s balance sheet value has decreased, reflecting shareholders’ funds of £29 million (2023: £31 million) of which £28.4 million (2023: £30.6 million) are net current assets. The Company has a cost structure that is unique for a tour operator; it is both scalable for upsizing and downsizing. Despite poor economic conditions, the Company has maintained the level of investments in areas of technology and human resources. It increased its marketing and branding budget spend in the year significantly. The company has not had to resort to any debt funding, having prudently stored exceptional reserves. These actions have led to consumers feeling confident because they know that management are taking the necessary steps to ensure the safety of the money they are holding on behalf of consumers. The Company can still repay customer refunds unequivocally and because of the commitment to maintain an exceptionally high standard of service, the Company’s reputation and branding have remained in high regard. The Company’s business model remains unchanged and we, as Directors, believe it has tremendous future potential; potential which will be propelled by its reputation that consumers can trust.
The Company holds an IATA and ATOL licence to ensure protection of customer monies and compliance with the package travel regulations.
Economic Recovery: Current economic conditions within the UK and worldwide has led to high inflation over the last year and this has inhibited growth. With the stabilisation of the inflation rate and economic landscape experienced post year end it has cast a realistic hope of improved growth for 2024/2025. Consumers are still very committed to travelling in the way they enjoyed pre pandemic. However, the UK travel industry remains extremely competitive, and the Company expects such competitive pressure to continue this year.
The continued cost-of-living crisis and increase in inflation rate over the last year can have a significant impact on the amount of money people have available to spend on travel. This reduced spending power can affect the company as customers may have less disposable income to allocate towards travel spent. Disruption in destinations: As a provider of travel services, the Company is naturally exposed to the risk of demand downturns from disruption in the destinations on offer. These downturns may be caused by factors such as disease, political volatility, natural disasters and terrorist activity, leading to travel restrictions, periods of uncertainty and reduced consumer confidence. The company seeks to mitigate these risks by offering a diverse portfolio of destinations by geography, season and nature of holiday; working closely with suppliers to ensure the best standards of safety are afforded to the customers throughout their holiday; and leveraging these to offer customer friendly terms and conditions that give customers the flexibility and security to book with confidence. The company has resilience plans for such events. The war in Ukraine and Middle East has led to subsequent rising costs of fuel prices which has impacted the cost of flights and will likely continue at unpredictable levels until stability is achieved. Geographical and political upheaval are unpredictable factors which could have a significant impact on air travel. These are outside our control and could have an impact on the Company’s trading position. No specific mitigation can be put in place to cover all possible threats, but the Company continues to offer a diverse offering of destinations and avoids high risk areas. Cyber threats: The travel industry is facing increasingly aggressive and sophisticated cyber threats. The Company does have tight financial controls, adherence to quality controlling of data protection and robust internal controls to prevent excessive exposure to this threat.
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SOUTHALL TRAVEL LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
Financial risks: Due to the Company’s strong financial position and prudent maintaining of cash there was no need to obtain debt to support activity over the last 36-months. This has meant that the Company has no exposure to increased interest rates; as is being used by government to keep the inflation rate controlled. It has actually benefitted from the increased interest rates on its cash balances. Change and Environmental Factors: There are increasing concerns about climate change and sustainability which can impact the travel industry. Changes in weather patterns, rising awareness of carbon footprints, and environmental regulations can influence customer preferences and demand for eco-friendly travel options. Both management and staff are well informed and understand the information that can be provided to consumers to assist in making choices. The company has entered into a number of initiatives with parties and suppliers to concentrate on reduction in carbon emissions. We, as Directors together with our management teams, are confident that the strategies and actions undertaken will positively reinforce the Company’s business activities. Furthermore, our collective commitment to continue to progress the Company’s strategic initiatives, will maintain the Company in a strong position to make progress in the current year.
The Company continues to monitor several KPI's across all of it's divisions, including; sales, gross profit margin, return on capital employed and operating cash flows.
The Company has a normal level of exposure to currency fluctuations. We, as Directors, continuously take appropriate steps to minimise the effects of such fluctuations. Any course of action is only undertaken after careful consideration and assessment of the situation. These types of reviews are ongoing.
The Company’s culture focuses on the importance of strong financial and operational risk management controls and ensuring that it complies with all applicable laws, regulations, and ethical principles. We, as Directors, regularly monitor the fulfilment of this culture at the operational level of the Company; receiving and considering regular reports from relevant business lines relating to key performance metrics and make decisions for improvement considered appropriate. By protecting the reputation and economic viability of the Company, the Directors believe that cultivating this culture is in the long-term interests of all its stakeholders.
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SOUTHALL TRAVEL LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
The Company has not deviated from its long-term strategic plan, despite the unprecedented disruption and financial uncertainty experienced in the last 3 years. The Company’s long-term policy is to generate and grow revenues by trading and providing high quality products to consumers in the travel sector. This is whilst managing financial, operational, regulatory, and legal risks in addition to optimising efficiencies.
As Directors we are committed to effectively managing specific risk-management objectives, which are outlined below: •Always maintain adequate financial resources. •Deliver sustainable and stable earnings growth. •Ensure stable and efficient access to funding and liquidity. •Always maintain stakeholder confidence. •Adhere to best practice for compliance with regulatory guidelines. We, as Directors, have made decisions relating to the critical areas of financial risk management, information technology investment, customer experience and information security. Additionally, a staff training and development regime has been implemented to maintain integrity, competence and capability of all members of staff.
The Company’s key internal and external stakeholders are their employees, customers, suppliers, shareholders and other relevant business partners. We, as Directors, uphold these relationships with the greatest importance; the interest and welfare of all the Company’s stakeholders are at the centre of our decision-making processes, as is the aim to promote the success of the Company for the benefit of all stakeholders. We, as Directors, believe that the Company’s actions in relation to achieving its strategic objectives are in line with the interest of its employees and the Company’s desire to foster positive business relationships with customers, suppliers and other relevant business partners.
The Company has a policy of fairness to all suppliers with the timeous payment of invoices. The Company protects the financial interest of customers by safeguarding their monies, and not using such monies to finance the working capital of the Company. This ensures customer funds are only used on supplying the consumer with their desired holiday arrangement. Further to this, when a refund is requested, it can be rendered immediately.
Communication and engagement with Company employees have continued of paramount importance during the last year. The Company has made staff welfare (including health and safety obligations) one of it’s top priorities. The Company has been committed to providing opportunities for its employees to develop and foster a secure, inclusive culture and office environment.
The Company’s employment policy is to provide equal opportunities to all current and prospective employees without any discrimination. The Company provides work environments in which all individuals are treated with respect and dignity.
The Company believes that by operating in an ethical and socially responsible manner it will help to preserve the environment. We, as Directors, believe such an ethical commitment is integral to forging an efficient and profitable business management approach, and recognise that success in these areas depends on the involvement and commitment of everyone in the organisation. The Company supports causes it believes are beneficial to the local community and the environment. Amongst other things, the Company contributes to a local charity which helps disadvantaged young people in need.
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SOUTHALL TRAVEL LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
This report was approved by the board on 28 July 2024 and signed on its behalf.
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SOUTHALL TRAVEL LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2024
The directors present their report and the financial statements for the year ended 31 March 2024.
The directors are responsible for preparing the Strategic Report, the Directors' Report and the financial statements in accordance with applicable law and regulations.
In preparing these financial statements, the directors are required to:
∙select suitable accounting policies for the Company'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 Company 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 to enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The directors are responsible for the maintenance and integrity of the corporate and financial information included on the Company's website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements and other information included in Directors' Reports may differ from legislation in other jurisdictions.
The principal activity of the Company in the year under review continued to be that of a travel agent and a tour operator.
The profit for the year, after taxation, amounted to £14,265,768 (2023 - £24,859,849).
Dividends paid for the year ended 31 March 2024 were £16.5 million (2023: £20 million).
The directors who served during the year were:
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SOUTHALL TRAVEL LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
The Company did not provide qualifying third-party indemnity provisions to its directors during the financial year and at the date of this report (2023: none).
The Company has a net current assets position of £28.4 million (2023: £30.6 million), net assets of £29 million as at 31 March 2024 (2023: £31 million) and generated profit before tax of £19 million (2023: £31 million). Despite the significant challenges posed by the global economic unrest the company has successfully continued to maintain its position of strength within the market.
One of the key factors contributing to the company’s positive results is the continued demand trajectory for travel and exploration. Despite the pressures on consumer finances people still have a very strong desire to prioritise travel and continue to create new experiences. The company continues to tap into this demand and offer attractive tour packages has been instrumental in this success. During the pandemic, the company did not break consumer laws and did not mistreat consumers by refusing refunds, forcing the acceptance of vouchers or refund credit notes when they were entitled to a cash refund. The company responded quickly, despite the unprecedented challenge faced, and maintained the high level of care to customers. Subsequently, unlike a lot of our competitors, this has meant we do not need to regain our customers trust in the post pandemic period, as it was never broken. While some businesses faced financial hardships and have been on a recovery path, or have high debt, the company was well prepared to weather the storm and seize opportunities as they arose. This stability has allowed us to invest in expanding our operations, enhancing our offerings, and exploring new markets, positioning us for long term success. The directors have prepared cash flow forecasts for an 18-month period from the date of approval of these financial statements. Forecasts prepared for the Company assume a steady and increasing demand for the rest of 2024, despite trends not being quite the same as pre pandemic. The outcome of the worst-case scenario indicates that, taking account of potential downside pressures, the Company will continue to have sufficient funds to meet its liabilities as they fall due for that period. The Company has substantial historic retained reserves that would enable the Company to sustain a long-term recovery of international travel market, including airline disruption, cost of living pressure on finances, increased supply costs, and the global economy unrest. Consequently, the directors are confident that the Company will have sufficient funds and cash reserves to continue to meet its liabilities as they fall due for at least 12 months from the date of approval of the financial statements and therefore have prepared the financial statements on a going concern basis.
The Company expects to grow further in the 2024/2025 period utilising current structure and strategy. They will focus on brand, technology and customer proposition.
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SOUTHALL TRAVEL LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
Relationship with suppliers: The Company has developed strong and ethical relationships with its suppliers. During a difficult period, the Company has continued to pay its suppliers on time and in full to ensure local wellbeing. The company believes that having strong direct relationships with our supply partners is of paramount importance as this guarantees quality, best practice and competitive pricing.
Relationship with customers: The Company has engaged and communicated with its customers. It has remained fully accessible by phone and online to assist in customer concerns and extra support for travel documentation and testing requirements. The company has customer focused policies, including timeliness of refunds, transparency on pricing and value for money. It remains one of the few tour operators to extend customers credit for flights already paid to the airline. Modern Slavery Act: The Modern Slavery Act requires the Company to publish an annual slavery and human trafficking statement. The latest statement can be found at the https://www.southalltravel .co.uk/modern -slavery-statement.pdf. The Company does not permit, condone, or otherwise accept any form of human trafficking or slavery in its business or supply chains.
The Company has not disclosed information in respect of greenhouse gas emissions, energy consumption and energy efficiency action as its energy consumption in the United Kingdom for the year is 40,000kWh or lower.
There have been no significant events affecting the Company since the year end.
The auditors, White Hart Associates (London) Limited, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.
This report was approved by the board on
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SOUTHALL TRAVEL LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SOUTHALL TRAVEL LIMITED
We have audited the financial statements of Southall Travel Limited (the 'Company') for the year ended 31 March 2024, which comprise the Statement of Comprehensive Income, the Statement of Financial Position, the Statement of Cash Flows, the Statement of Changes in Equity and the related notes, including a summary of 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).
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 Company 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.
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 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.
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SOUTHALL TRAVEL LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SOUTHALL TRAVEL LIMITED (CONTINUED)
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.
In our opinion, based on the work undertaken in the course of the audit:
∙the information given in the 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 Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.
In the light of the knowledge and understanding of the Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Directors' Report.
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SOUTHALL TRAVEL LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SOUTHALL TRAVEL LIMITED (CONTINUED)
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 financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:
- We exercise professional judgment and maintain professional skepticism throughout the audit; - We identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the deliberate override of internal control; - We obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of internal control; - We evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made; - We assess the risk of management override of controls, including testing journal entries and other adjustments for appropriateness, and evaluating the business rationale of significant transactions outside the normal course of business; - We review the scope of the Company's compliance with its regulator, the Civil Aviation Authority ("CAA"), and sample test relevant documentation to assess this and the effectiveness of its control environment; - We request and review the minutes of management meetings, and assess any matters identified not already provided for or disclosed that may materially impact the financial statements; - We conclude on the appropriateness of the directors' use of the going concern basis of accounting and, based on the evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the entity's ability to continue as a going concern. if we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the entity to cease to continue as a going concern.
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.
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SOUTHALL TRAVEL LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SOUTHALL TRAVEL LIMITED (CONTINUED)
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 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.
for and on behalf of
Chartered Accountants and Statutory Auditors
2nd Floor, Nucleus House
2 Lower Mortlake Road
TW9 2JA
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SOUTHALL TRAVEL LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2024
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SOUTHALL TRAVEL LIMITED
REGISTERED NUMBER: 01869431
STATEMENT OF FINANCIAL POSITION
AS AT 31 MARCH 2024
The financial statements were approved and authorised for issue by the board and were signed on its behalf on
The notes on pages 18 to 28 form part of these financial statements.
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SOUTHALL TRAVEL LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2024
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SOUTHALL TRAVEL LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2024
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SOUTHALL TRAVEL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
As disclosed in the Directors' Report, the principal activity of the Company during the year under review continued to be that of a travel agent and a tour operator.
The Company is a private company limited by shares and is incorporated in England & Wales. The address of the Company's principal place of business, being different to the registered office stated on the Company information page is 32 Dover Street, Mayfair, London, W1S 4NE.
2.Accounting policies
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 management to exercise judgment in applying the Company's accounting policies (see note 3).
The Company's parent undertaking, Onkar International Limited, includes the Company in its consolidated financial statements. The consolidated financial statements of Onkar International Limited are prepared in accordance with FRS 102 and are available to the public and can be obtained from 19 South Road, Southall Middlesex UB1 1SU. In these financial statements, the Company is considered to be a qualifying entity (for the purposes of this FRS) and has applied the exemptions available under FRS 102 in respect of the following disclosures:
- Key Management Personnel compensation; - Disclosures in respect of transactions with wholly owned subsidiaries (see note 19).
The following principal accounting policies have been applied:
The company holds cash as at 31 March 2024 of £60 million, which is all unrestricted cash. The company has no borrowings.
The company has net current assets of £28.4m as at 31 March 2024 as compared to £30.6 million as at 31 March 2023. These high levels of cash and net current assets at the reporting date provide a strong financial cushion and enhance the company’s ability to meet its short-term financial obligations. The availability of substantial cash reserves enables the company to fund its ongoing operations, invest in growth opportunities and withstand unforeseen financial shocks. The high net current assets indicate a healthy liquidity position, which provides the company with the necessary flexibility to manage its day-to-day operations, settle its obligations, have coverage for all customer deposits paid in advance, and respond to changes in market conditions effectively. The directors have conducted a thorough review of the company's financial statements, cash flow forecasts, and projected profitability. Based on their assessment, they believe that the company's high cash reserves, high net current assets, and favourable liquidity position provide a reasonable expectation that the company will be able to continue its operations and meet its financial obligations as they become due in the normal course of business.
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SOUTHALL TRAVEL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
2.Accounting policies (continued)
It should be noted that the company's ability to operate as a going concern is subject to various risks and uncertainties, including those related to the tourism industry, economic conditions, and regulatory changes. The directors will continue to closely monitor these factors and take appropriate actions to mitigate any potential adverse effects on the company's financial stability and going concern status.
Taking all factors into consideration the directors are satisfied that it is appropriate to continue to adopt the going concern basis of accounting in preparing the company’s financial statements, for at least the 12 months following the approval of the financial statements.
Functional and presentation currency
Transactions and balances
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SOUTHALL TRAVEL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
2.Accounting policies (continued)
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SOUTHALL TRAVEL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
2.Accounting policies (continued)
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, on a reducing balance basis.
Depreciation is provided on the following basis:
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.
Provisions are charged as an expense to profit or loss in the year that the Company becomes aware of the obligation, and are measured at the best estimate at the Statement of Financial Position date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties. When payments are eventually made, they are set off against the provision carried in the Statement of Financial Position.
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SOUTHALL TRAVEL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
2.Accounting policies (continued)
The Company has elected to apply the provisions of Section 11 “Basic Financial Instruments” of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the Company's Statement of Financial Position when the Company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include trade and other receivables, cash and bank balances, are initially measured at their transaction price including transaction costs and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest.
Discounting is omitted where the effect of discounting is immaterial. The Company's cash and cash equivalents, trade and most other receivables due with the operating cycle fall into this category of financial instruments.
Financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instruments any contract that evidences a residual interest in the assets of the Company after the deduction of all its liabilities.
Basic financial liabilities, which include trade and other payables, bank loans and other loans are initially measured at their transaction price after transaction costs. When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest. Discounting is omitted where the effect of discounting is immaterial.
Debt instruments are subsequently carried at their amortised cost using the effective interest rate method.
Trade payables are obligations to pay for goods and services that have been acquired in the ordinary course of business from suppliers. Trade payables are classified as current liabilities if the payment is due within one year. If not, they represent non-current liabilities. Trade payables are initially recognised at their transaction price and subsequently are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial.
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SOUTHALL TRAVEL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
a) Critical judgments in applying the Company's accounting policies The directors believe that there are no critical judgments involved in applying the Company's accounting policies that warrant disclosure. b) Key accounting estimates and assumptions The directors believe that there are no key accounting estimates and assumptions involved in applying the Company's accounting policies that warrant disclosure.
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SOUTHALL TRAVEL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
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SOUTHALL TRAVEL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
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SOUTHALL TRAVEL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
11.Taxation (continued)
There were no factors that may affect future tax charges.
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SOUTHALL TRAVEL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
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SOUTHALL TRAVEL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
As at 31 March 2024 an amount of £36,673,833 (2023: £21,449,774) was payable to International Air Transport Association (IATA) for tickets issued in the month of March 2024.
The Company's immediate parent undertaking is Onkar International Limited, a company incorporated in England & Wales. The ultimate parent company is ST Holdings Limited incorporated in Guernsey with registered office at Third Floor, Cambridge House, Le Truchot, St. Peter Port, Guernsey GY1 WD. The ultimate controlling party is K S Bahia.
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