Company registration number 06483887 (England and Wales)
VOLARIS GROUP UK HOLDCO LTD
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
VOLARIS GROUP UK HOLDCO LTD
COMPANY INFORMATION
Directors
M R Miller
B Beattie
D Riley
Secretary
D Riley
Company number
06483887
Registered office
Rivington House
Chorley North Business Park
Drumhead Road
Chorley
Lancashire
England
PR6 7BX
Auditor
PM+M Solutions for Business LLP
New Century House
Greenbank Technology Park
Challenge Way
Blackburn
Lancashire
BB1 5QB
VOLARIS GROUP UK HOLDCO LTD
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3 - 4
Independent auditor's report
5 - 8
Statement of comprehensive income
9
Balance sheet
10
Statement of changes in equity
11
Notes to the financial statements
12 - 24
VOLARIS GROUP UK HOLDCO LTD
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -
The directors present the strategic report for the year ended 31 December 2023.
The company acts as a holding company and intellectual property owner, and therefore has only intercompany revenues relating to intellectual property and investments.
Review of the business
The directors aim to present a balanced and comprehensive review of the development and performance of the business during the year and its position at the year end. Our review is consistent with the size and non‑complex nature of the business and is written in the context of the risks and uncertainties we face.
Principal risks and uncertainties
The directors are of the opinion that risks for the company are low and manageable. All the company’s revenues derive from cash flows from affiliate companies. The company has an increasingly diversified portfolio of investments associated with a range of affiliate companies, and each affiliate company has a diversified pool of clients and products, such that no single customer, product or investment will have a disproportionate impact on results. Instead, a significant proportion of the company's revenues ultimately derive from long-term, recurring business with the loyal customer bases of our affiliate companies.
The company does have short and long-term liabilities totalling approximately 43.2x current year profit after tax. However, 93% of these liabilities are to our affiliate companies and the liabilities equate to approximately 61% of the book value of the portfolio of investments. We have reviewed these book values as part of our structured audit process and consider them reasonable.
Financial key performance indicators
The directors use the key performance indicators defined by our parent group to manage the business. The key performance indicators are revenue growth, operating profit and operating profit margin.
2023
2022
Turnover £
7,179,122
6,818,235
Revenue variance %
5
14
Operating profit / (loss)
1,364,282
(81,908,427)
Operating profit margin %
19
(1,201)
Revenues increased by 5% in the year. The driver for the increase was due to higher year on year Corporate Allocation recharges. Turnover with our UK affiliated entity increased by 8% and was our largest increase on prior year compared to revenue for the Rest of World.
Our operating profit margin increased from (1201%) to 19%, driving our operating profit margin percentage to increase by 1,220% from the previous year. This was due to Administrative expenses returning to a normal level in 2023 following the exceptional entries recorded in 2022 as a result of the group legal structure change. In 2022, forgiveness on intra group loans related to 95% of those Administrative expenses.
During 2022 there was a reorganisation of the group legal entity structure to facilitate the spin out of Lumine group
from Constellation Inc which was completed in February 2023. This had an impact on several figures
throughout these financial statements such as profit on disposal of investments which has been reported but all
these were in line with the expectation of the group following this restructure.
VOLARIS GROUP UK HOLDCO LTD
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
The directors consider these results to be satisfactory.
Other key performance indicators
There are no other performance indicators used to manage the business.
D Riley
Director
9 August 2024
VOLARIS GROUP UK HOLDCO LTD
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -
The directors present their annual report and financial statements for the year ended 31 December 2023.
Principal activities
The principal activity of the company continued to be that of a holding company and intellectual property owner.
Results and dividends
The results for the year are set out on page 9.
Ordinary dividends were paid amounting to £4,108,000. The directors do not recommend payment of a final dividend.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
M R Miller
J A Baker
(Resigned 10 October 2023)
B Beattie
D Riley
Auditor
The auditor, PM+M Solutions for Business LLP, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
Statement of directors' responsibilities
The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and
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 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.
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 company’s auditor 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 company’s auditor is aware of that information.
VOLARIS GROUP UK HOLDCO LTD
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 4 -
Medium-sized companies exemption
This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.
On behalf of the board
D Riley
Director
9 August 2024
VOLARIS GROUP UK HOLDCO LTD
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF VOLARIS GROUP UK HOLDCO LTD
- 5 -
Opinion
We have audited the financial statements of Volaris Group UK Holdco Ltd (the 'company') for the year ended 31 December 2023 which comprise the statement of comprehensive income, the balance sheet, the statement of changes in equity 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 101 Reduced Disclosure Framework (United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
give a true and fair view of the state of the company's affairs as at 31 December 2023 and of its profit for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our 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 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.
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:
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.
VOLARIS GROUP UK HOLDCO LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBER OF VOLARIS GROUP UK HOLDCO LTD
- 6 -
Matters on which we are required to report by exception
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.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors' responsibilities statement, 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 company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
Extent to which the audit was considered capable of detecting irregularities, including fraud
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 identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and then design and perform audit procedures responsive to those risks, including obtaining audit evidence that is sufficient and appropriate to provide a basis for our opinion.
VOLARIS GROUP UK HOLDCO LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBER OF VOLARIS GROUP UK HOLDCO LTD
- 7 -
Identifying and assessing potential risks related to irregularities
In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, we have considered the following:
the nature of the industry and sector, control environment and business performance including the design of the company's remuneration policies, key drivers for directors’ remuneration, bonus levels and performance targets;
results of our enquiries of management about their own identification and assessment of the risks of irregularities;
any matters we identified having obtained and reviewed the company's documentation of their policies and procedures relating to:
identifying, evaluating and complying with laws and regulations and whether they were aware of any instances of non-compliance;
detecting and responding to the risks of fraud and whether they have knowledge of any actual, suspected or alleged fraud;
the internal controls established to mitigate risks of fraud or non-compliance with laws and regulations;
the matters discussed among the audit engagement team including significant component audit teams and involving relevant specialists regarding how and where fraud might occur in the financial statements and any potential indicators of fraud.
As a result of these procedures, we considered the opportunities and incentives that may exist within the organisation for fraud and identified the greatest potential for fraud in the following areas: timing of recognition of commercial income, posting of unusual journals and complex transactions and manipulating the company's performance profit measures and other key performance indicators to meet remuneration targets and externally communicated targets. In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override.
We also obtained an understanding of the legal and regulatory frameworks that the company operates in, focusing on provisions of those laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements. The key laws and regulations we considered in this context included UK Companies Act, employment law, health and safety, pensions legislation and tax legislation.
Audit response to risks identified
Our procedures to respond to risks identified included the following:
reviewing the financial statement disclosures and testing to supporting documentation to assess compliance with provisions of relevant laws and regulations described as having a direct effect on the financial statements;
enquiring of management concerning actual and potential litigation and claims;
performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud;
reading minutes of meetings of those charged with governance and reviewing correspondence with HMRC; and
in addressing the identified risks of fraud through management override of controls, testing the appropriateness of journal entries and other adjustments; assessing whether the judgements made in making accounting estimates are indicative of a potential bias; and evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business.
Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, the further removed non-compliance with laws and regulations (irregularities) is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it. In addition, as with any audit, there remained a higher risk of non-detection of irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls. We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations.
VOLARIS GROUP UK HOLDCO LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBER OF VOLARIS GROUP UK HOLDCO LTD
- 8 -
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.
This report is made solely to the company’s member 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 member, those matters we are required to state to the member 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 member, for our audit work, for this report, or for the opinions we have formed.
Miss Helen Louise Clayton BSc FCA (Senior Statutory Auditor)
For and on behalf of PM+M Solutions for Business LLP
9 August 2024
Chartered Accountants
Statutory Auditor
New Century House
Greenbank Technology Park
Challenge Way
Blackburn
Lancashire
BB1 5QB
VOLARIS GROUP UK HOLDCO LTD
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
- 9 -
2023
2022
Notes
£
£
Turnover
3
7,179,122
6,818,235
Administrative expenses
(5,814,840)
(88,726,662)
Operating profit/(loss)
4
1,364,282
(81,908,427)
Interest receivable and similar income
7
4,270,815
87,032,218
Interest payable and similar expenses
8
(1,129,957)
(171,760)
Amounts written off investments
9
190,398,836
Profit before taxation
4,505,140
195,350,867
Tax on profit
10
(767,245)
239,669
Profit and total comprehensive income for the financial year
3,737,895
195,590,536
The profit and loss account has been prepared on the basis that all operations are continuing operations.
VOLARIS GROUP UK HOLDCO LTD
BALANCE SHEET
AS AT
31 DECEMBER 2023
31 December 2023
- 10 -
2023
2022
Notes
£
£
£
£
Fixed assets
Intangible assets
12
831,332
1,490,092
Investments
13
247,836,058
232,038,108
248,667,390
233,528,200
Current assets
Debtors
15
140,892,263
88,896,690
Cash at bank and in hand
25,296
27,909
140,917,559
88,924,599
Creditors: amounts falling due within one year
16
(152,605,023)
(88,055,037)
Net current (liabilities)/assets
(11,687,464)
869,562
Total assets less current liabilities
236,979,926
234,397,762
Creditors: amounts falling due after more than one year
16
(8,878,346)
(5,926,077)
Net assets
228,101,580
228,471,685
Capital and reserves
Called up share capital
19
20,384,829
20,384,829
Capital redemption reserve
20
12,701,742
12,701,742
Profit and loss reserves
195,015,009
195,385,114
Total equity
228,101,580
228,471,685
The financial statements were approved by the board of directors and authorised for issue on 9 August 2024 and are signed on its behalf by:
D Riley
Director
Company registration number 06483887 (England and Wales)
VOLARIS GROUP UK HOLDCO LTD
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 11 -
Share capital
Capital redemption reserve
Profit and loss reserves
Total
Notes
£
£
£
£
Balance at 1 January 2022
20,384,829
12,701,742
18,794,578
51,881,149
Year ended 31 December 2022:
Profit and total comprehensive income
-
-
195,590,536
195,590,536
Transactions with owners:
Dividends
-
-
(19,000,000)
(19,000,000)
Balance at 31 December 2022
20,384,829
12,701,742
195,385,114
228,471,685
Year ended 31 December 2023:
Profit and total comprehensive income
-
-
3,737,895
3,737,895
Transactions with owners:
Dividends
-
-
(4,108,000)
(4,108,000)
Balance at 31 December 2023
20,384,829
12,701,742
195,015,009
228,101,580
VOLARIS GROUP UK HOLDCO LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 12 -
1
Accounting policies
Company information
Volaris Group UK Holdco Ltd is a private company limited by shares incorporated in England and Wales. The registered office is Rivington House, Chorley North Business Park, Drumhead Road, Chorley, Lancashire, England, PR6 7BX. The company's principal activities and nature of its operations are disclosed in the directors' report.
1.1
Accounting convention
The financial statements have been prepared in accordance with Financial Reporting Standard 101 Reduced Disclosure Framework (FRS 101) and in accordance with applicable accounting standards.
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. The principal accounting policies adopted are set out below.
As permitted by FRS 101, the company has taken advantage of the following disclosure exemptions from the requirements of IFRS:
inclusion of an explicit and unreserved statement of compliance with IFRS;
presentation of a statement of cash flows and related notes;
disclosure of the objectives, policies and processes for managing capital;
disclosure of key management personnel compensation;
disclosure of the categories of financial instrument and the nature and extent of risks arising on these financial instruments;
the effect of financial instruments on the statement of comprehensive income;
comparative period reconciliations for the number of shares outstanding and the carrying amounts of property, plant and equipment, intangible assets, investment property and biological assets;
disclosure of the future impact of new International Financial Reporting Standards in issue but not yet effective at the reporting date;
for financial instruments measured at fair value and within the scope of IFRS 13, the valuation techniques and inputs used to measure fair value, the effect of fair value measurements with significant unobservable inputs on the result for the period and the impact of credit risk on the fair value; and
related party disclosures for transactions with the parent or wholly owned members of the group.
Where required, equivalent disclosures are given in the group accounts of Constellation Software Inc. The group accounts of Constellation Software Inc. are available to the public and can be obtained as set out in note 23.
1.2
Going concern
The directors have at the time of approving the financial statements, a reasonable expectation that the truecompany 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.
1.3
Turnover
Turnover is recognised to the extent that it is probable that the economic benefits will flow to the company and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes.
Revenue represents royalties receivable.
VOLARIS GROUP UK HOLDCO LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 13 -
1.4
Intangible assets other than goodwill
Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.
Intangible assets acquired on business combinations are recognised separately from goodwill at the acquisition date where it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the fair value of the asset can be measured reliably; the intangible asset arises from contractual or other legal rights; and the intangible asset is separable from the entity.
Amortisation 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:
1.5
Fixed asset investments
Interests in subsidiaries are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.
1.6
Impairment of tangible and intangible assets
At each reporting end date, the company 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.
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.
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.
1.7
Cash at bank and in hand
Cash and cash equivalents include cash in hand, deposits held at call with banks and other short-term liquid investments with original maturities of three months or less.
1.8
Financial assets
Financial assets are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument. Financial assets are classified into specified categories, depending on the nature and purpose of the financial assets.
At initial recognition, financial assets classified as fair value through profit and loss are measured at fair value and any transaction costs are recognised in profit or loss. Financial assets not classified as fair value through profit and loss are initially measured at fair value plus transaction costs.
VOLARIS GROUP UK HOLDCO LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 14 -
Financial assets held at amortised cost
Financial instruments are classified as financial assets measured at amortised cost where the objective is to hold these assets in order to collect contractual cash flows, and the contractual cash flows are solely payments of principal and interest. They arise principally from the provision of goods and services to customers (eg trade receivables). They are initially recognised at fair value plus transaction costs directly attributable to their acquisition or issue, and are subsequently carried at amortised cost using the effective interest rate method, less provision for impairment where necessary.
Impairment of financial assets
Financial assets carried at amortised cost and FVOCI are assessed for indicators of impairment at each reporting end date.
The expected credit losses associated with these assets are estimated on a forward-looking basis. A broad range of information is considered when assessing credit risk and measuring expected credit losses, including past events, current conditions, and reasonable and supportable forecasts that affect the expected collectability of the future cash flows of the instrument.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire, or when it transfers the financial asset and substantially all the risks and rewards of ownership to another entity.
1.9
Financial liabilities
The company recognises financial debt when the company becomes a party to the contractual provisions of the instruments. Financial liabilities are classified as either 'financial liabilities at fair value through profit or loss' or 'other financial liabilities'.
Financial liabilities at fair value through profit or loss
Financial liabilities are classified as measured at fair value through profit or loss when the financial liability is held for trading. A financial liability is classified as held for trading if:
it has been incurred principally for the purpose of repurchasing it in the near term, or
on initial recognition it is part of a portfolio of identified financial instruments that the manages together and has a recent actual pattern of short-term profit taking, or
it is a derivative that is not designated and effective hedging instrument.
Financial liabilities at fair value through profit or loss are stated at fair value with any gains or losses arising on remeasurement recognised in profit or loss.
Other financial liabilities
Other financial liabilities, including borrowings, trade payables and other short-term monetary liabilities, are initially measured at fair value net of transaction costs directly attributable to the issuance of the financial liability. They are subsequently measured at amortised cost using the effective interest method. For the purposes of each financial liability, interest expense includes initial transaction costs and any premium payable on redemption, as well as any interest or coupon payable while the liability is outstanding.
Derecognition of financial liabilities
Financial liabilities are derecognised when, and only when, the company’s obligations are discharged, cancelled, or they expire.
1.10
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of direct issue costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
VOLARIS GROUP UK HOLDCO LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 15 -
1.11
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’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 is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit, and is accounted for using the balance sheet liability method. Deferred tax liabilities are generally recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised. Such assets and liabilities are not recognised if the temporary 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 when the company has 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.
1.12
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 inventories 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.
1.13
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.14
Foreign exchange
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.
VOLARIS GROUP UK HOLDCO LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 16 -
2
Critical accounting estimates and judgements
In the application of the company’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, if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.
The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are outlined below.
Key sources of estimation uncertainty
Impairment of non-financial assets
In assessing impairment, management estimates the recoverable amount of each asset or cash‑generating units based on expected future cash flows and uses an interest rate to discount them. Estimation uncertainty relates to assumptions about future operating results and the determination of a suitable discount rate.
Amortisation rates
The company amortises its intangible assets over their estimated useful lives, as more fully described in the accounting policies note 1.4 for intangible assets. The actual lives of these assets can vary depending on a variety of factors, including technological innovation, developments in the wider business and maintenance programmes.
3
Turnover
2023
2022
£
£
Turnover analysed by class of business
Royalties receivable
6,305,022
6,248,034
Corporate allocation recharge
874,100
570,201
7,179,122
6,818,235
2023
2022
£
£
Turnover analysed by geographical market
United Kingdom
1,534,263
1,422,064
Rest of World
5,644,859
5,396,171
7,179,122
6,818,235
VOLARIS GROUP UK HOLDCO LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 17 -
4
Operating profit/(loss)
2023
2022
Operating profit/(loss) for the year is stated after charging/(crediting):
£
£
Exchange (gains)/losses
(172,457)
937,593
Fees payable to the company's auditor for the audit of the company's financial statements
10,500
14,500
Amortisation of intangible assets (included within administrative expenses)
658,761
690,150
5
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Directors
4
4
Their aggregate remuneration comprised:
2023
2022
£
£
Wages and salaries
159,147
Pension costs
9,097
168,244
6
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
159,147
Company pension contributions to defined contribution schemes
9,097
168,244
Only one director is remunerated in this company, the remaining current directors are paid by a fellow group company.
VOLARIS GROUP UK HOLDCO LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 18 -
7
Interest receivable and similar income
2023
2022
£
£
Interest income
Other interest income
173,814
Income from fixed asset investments
Income from shares in group undertakings
4,097,001
87,032,218
Total income
4,270,815
87,032,218
8
Interest payable and similar expenses
2023
2022
£
£
Interest on financial liabilities measured at amortised cost:
Interest payable to group undertakings
1,129,957
169,175
Interest on other loans
2,585
1,129,957
171,760
9
Amounts written off investments
2023
2022
£
£
Gain on disposal of fixed asset investments
-
190,398,836
10
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
-
394,496
Adjustments in respect of prior periods
(394,496)
(634,165)
Other tax reliefs
1,161,741
-
Total UK current tax
767,245
(239,669)
VOLARIS GROUP UK HOLDCO LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
10
Taxation
(Continued)
- 19 -
The charge for the year can be reconciled to the profit per the profit and loss account as follows:
2023
2022
£
£
Profit before taxation
4,505,140
195,350,867
Expected tax charge based on a corporation tax rate of 23.52% (2022: 19.00%)
1,059,609
37,116,665
Effect of expenses not deductible in determining taxable profit
614,650
15,989,731
Income not taxable
(40,882)
(36,175,779)
Adjustment in respect of prior years
(394,496)
(634,165)
Group relief
(669,470)
Group income
(963,637)
(16,536,121)
Other tax relief
1,161,471
-
Taxation charge/(credit) for the year
767,245
(239,669)
11
Impairments
Impairment tests have been carried out where appropriate and the following impairment losses have been recognised in profit or loss.
2023
2022
£
£
Recognised in:
Administrative expenses
-
84,408,762
VOLARIS GROUP UK HOLDCO LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 20 -
12
Intangible fixed assets
Intellectual property
£
Cost
At 31 December 2022
10,305,435
At 31 December 2023
10,305,435
Amortisation and impairment
At 31 December 2022
8,815,343
Charge for the year
658,761
At 31 December 2023
9,474,103
Carrying amount
At 31 December 2023
831,332
At 31 December 2022
1,490,092
13
Investments
Current
Non-current
2023
2022
2023
2022
£
£
£
£
Investments in subsidiaries
-
-
247,836,058
232,038,108
Fair value of financial assets carried at amortised cost
The directors consider that the carrying amounts of financial assets carried at amortised cost in the financial statements approximate to their fair values.
VOLARIS GROUP UK HOLDCO LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
13
Investments
(Continued)
- 21 -
Movements in fixed asset investments
Shares in subsidiaries
£
Cost or valuation
At 1 January 2023
232,038,108
Additions
15,610,240
Valuation changes
187,710
At 31 December 2023
247,836,058
Carrying amount
At 31 December 2023
247,836,058
At 31 December 2022
232,038,108
14
Subsidiaries
Details of the company's subsidiaries at 31 December 2023 are as follows:
Name of undertaking
Registered office
Class of
% Held
shares held
Direct
Cultura Technologies Limited
England and Wales
Ordinary
100.00
Kinetic Solutions Limited
England and Wales
Ordinary
100.00
Wellington Computer Systems Limited
Ireland
Ordinary
100.00
Core Tech Software Limited
Ireland
Ordinary
100.00
Wynne Systems (UK) Limited
England and Wales
Ordinary
100.00
Furlong Business Solutions Limited
England and Wales
Ordinary
100.00
Imperial Business Systems Limited
England and Wales
Ordinary
100.00
MotionData Vector Software GmbH
Austria
Ordinary
100.00
NitroSell Limited
Ireland
Ordinary
100.00
SSP Midco 2 Limited
England Wales
Ordinary
100.00
Lightbulb Analytics Limited
England and Wales
Ordinary
100.00
Cultura Technologies Deutschland GmbH
Germany
Ordinary
100.00
Grosvenor Systems Limited
England and Wales
Ordinary
100.00
IndiCater Limited
England and Wales
Ordinary
100.00
WiFiSPARK Limited
England and Wales
Ordinary
100.00
GoAssetWorks Limited
England and Wales
Ordinary
100.00
Hospedia Limited
England and Wales
Ordinary
100.00
Artifax Group Limited
England and Wales
Ordinary
100.00
Artifax Software Limited
England and Wales
Ordinary
100.00
Artifax Limited
England and Wales
Ordinary
100.00
Worldwide Chain Store Holdings Limited
England and Wales
Ordinary
100.00
Worldwide Chain Stores Limited
England and Wales
Ordinary
100.00
ASC Automotive Solutions Center Schweiz AG
Switzerland
Ordinary
100.00
ASC Automotive Solution Center AG
Germany
Ordinary
100.00
Care Software AG
Switzerland
Ordinary
100.00
Across Systems GMBH
Germany
Ordinary
100.00
VOLARIS GROUP UK HOLDCO LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
14
Subsidiaries
Name of undertaking
Registered office
Class of
% Held
shares held
Direct
(Continued)
- 22 -
Across Systems.RU LLC
Russia
Ordinary
100.00
MotionData Vector Schweiz GmbH
Switzerland
Ordinary
100.00
MotionData Vector Deutschland GmbH
Germany
Ordinary
100.00
MD mobilApp Software GmbH
Austria
Ordinary
50.00
SSP Midco 1 Limited
England and Wales
Ordinary
100.00
SSP Bidco Limited
England and Wales
Ordinary
100.00
SSP Holdings Limited
England and Wales
Ordinary
100.00
SSP Limited
England and Wales
Ordinary
100.00
SSP Sirius Solutions Limited
England and Wales
Ordinary
100.00
Software Solutions Partners Africa (Proprietary) Limited
South Africa
Ordinary
100.00
SSP (New Zealand) Limited
New Zealand
Ordinary
100.00
Keychoice Underwriting Limited
England and Wales
Ordinary
100.00
SSP (India) Private Limited
India
Ordinary
99.90
SSP (Africa) Holdings (Proprietary) Limited
South Africa
Ordinary
100.00
Policy Master Group Limited
England and Wales
Ordinary
100.00
Keychoice Insurance Marketing Limited
England and Wales
Ordinary
100.00
Holdgrove Limited
England and Wales
Ordinary
100.00
SSP Asia Pacific Pty Limited
Australia
Ordinary
100.00
Sectornet Limited
England and Wales
Ordinary
100.00
SSP Sirius Limited
England and Wales
Ordinary
100.00
Sirius Financial Systems Group Limited
England and Wales
Ordinary
100.00
Mediquote Health Solutions Limited
England and Wales
Ordinary
100.00
Lightbulb Analytics Limited
England and Wales
Ordinary
100.00
Fmade GmbH
Germany
Ordinary
100.00
Company Watch Investments Limited
England and Wales
Ordinary
100.00
Company Watch Limited
England and Wales
Ordinary
100.00
Alemba Topco Limited
England and Wales
Ordinary
100.00
Alemba Limited
England and Wales
Ordinary
100.00
Alemba Pty Ltd.
Australia
Ordinary
100.00
Alemba NZ Limited
New Zealand
Ordinary
100.00
EASA Software Limited
England and Wales
Ordinary
100.00
EASA Inc.
United States
Ordinary
100.00
Volaris Group Canada Holdings Inc.
Canada
Ordinary
100.00
Technology Blueprint Limited
England and Wales
Ordinary
100.00
Tech Blue Software Private Limited
India
Ordinary
100.00
Checkdocs Limited
England and Wales
Ordinary
100.00
Sunrise Software Limited
England and Wales
Ordinary
100.00
Corbett Engineering Limited
England and Wales
Ordinary
100.00
Loop Portal UK Limited
England and Wales
Ordinary
100.00
Software Company AMIC GmbH
Germany
Ordinary
100.00
Nathan Grace Holdings Limited
England and Wales
Ordinary
100.00
Chevin Computer Systems Limited
England and Wales
Ordinary
100.00
Chevin Fleet Solutions Pty Ltd
Australia
Ordinary
100.00
Chevin Fleet Solutions BV
Belgium
Ordinary
99.00
Chevin Sarl
France
Ordinary
100.00
Vision Group B.V.
Netherlands
Ordinary
100.00
Routevision Services B.V.
Netherlands
Ordinary
100.00
Routevision Nederland B.V.
Netherlands
Ordinary
100.00
VOLARIS GROUP UK HOLDCO LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
14
Subsidiaries
Name of undertaking
Registered office
Class of
% Held
shares held
Direct
(Continued)
- 23 -
Routevision Belgium B.V.
Belgium
Ordinary
100.00
HGEM Limited
England and Wales
Ordinary
100.00
The Mystery Dining Company Limited
England and Wales
Ordinary
100.00
DisplayNote Technologies Limited
Northern Ireland
Ordinary
100.00
DisplayNote Technologies SLU
Spain
Ordinary
100.00
15
Debtors
2023
2022
£
£
Corporation tax recoverable
84,809
624,316
Amounts owed by fellow group undertakings
140,794,352
88,157,964
Other debtors
3,544
109,410
Prepayments and accrued income
9,558
5,000
140,892,263
88,896,690
16
Creditors
Due within one year
Due after one year
2023
2022
2023
2022
Notes
£
£
£
£
Creditors
17
152,605,023
88,055,037
8,878,346
5,926,077
17
Creditors
Due within one year
Due after one year
2023
2022
2023
2022
£
£
£
£
Trade creditors
10,730
Amounts owed to fellow group undertakings
150,350,943
85,797,234
-
-
Accruals and deferred income
402,687
337,434
Other creditors
1,851,393
1,909,639
8,878,346
5,926,077
152,605,023
88,055,037
8,878,346
5,926,077
VOLARIS GROUP UK HOLDCO LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 24 -
18
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
9,097
-
The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.
19
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
20,384,829
20,384,829
20,384,829
20,384,829
20
Capital redemption reserve
2023
2022
£
£
At the beginning and end of the year
12,701,742
12,701,742
21
Contingent liabilities
Included within trade payables are contingent liabilities relating to the purchase of subsidiaries which total £8,680,303 (2022 - £6,038,020). These amounts are contingent on the performance of the individual companies as stated in the signed sale and purchase agreements.
22
Related party transactions
As permitted by FRS 101, related party transactions with wholly owned members of the Constellation Software Inc. have not been disclosed.
23
Controlling party
The company's immediate parent company is Constellation Software UK Holdco Ltd, a company incorporated in the UK, which is the parent of the smallest group of which the company is a member.
The ultimate parent company is Constellation Software Inc., a company incorporated in Canada.
Copies of the consolidated financial statements of Constellation Software Inc. are made available to the public and may be obtained from www.csisoftware.com/category/stat-filings.
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