Company registration number 12242636 (England and Wales)
CFH UK HOLDING LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
CFH UK HOLDING LIMITED
COMPANY INFORMATION
Directors
J S Salden
A Levy
(Appointed 27 February 2023)
Aroundtown Real Estate Management (UK) Ltd
(Appointed 27 February 2023)
Secretary
Oakwood Corporate Secretary Limited
Company number
12242636
Registered office
3rd Floor 1 Ashley Road
Altrincham
Cheshire
United Kingdom
WA14 2DT
Auditor
Mercer & Hole LLP
London
EC3V 9AH
CFH UK HOLDING LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2
Directors' responsibilities statement
3
Independent auditor's report
4 - 6
Profit and loss account
7
Statement of comprehensive income
8
Balance sheet
9
Statement of changes in equity
10
Statement of cash flows
11
Notes to the financial statements
12 - 21
CFH UK HOLDING LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -
The directors present the strategic report for the year ended 31 December 2023.
Review of the business
Following a strategic review of the operations of the business the company ceased to operate the hotels post year end. In July 2024, the hotels trade was transferred to B&B Hotels, a third party company.
The company directors anticipate that they will continue to pay off all their debts as they fall due and either acquire new hotels in the future or consider strategic options for the company, one of which will be to close the company. The group has committed to continue to support the company to enable it to meet its liabilities as they fall due.
The activities of the company during the year consisted of the following elements:
5 Hotels operated under the brand of Penta Hotels Worldwide located in the following locations:
Pentahotel Birmingham: 131 Rooms, Pentalounge, 2 conference rooms, fitness & gym
Pentahotel Derby: 112 Rooms, Pentalounge, 3 conference rooms, fitness & gym, parking
Pentahotel Inverness: 90 Rooms, Pentalounge, fitness & gym, parking
Pentahotel Ipswich: 126 Rooms, Pentalounge, 2 conference rooms, parking, fitness & gym
Pentahotel Warrington: 103 Rooms, Pentalounge, 2 conference rooms, parking
The turnover for the year ended 31 December 2023 was £14.93m, £1.61m more than the previous year.
The directors anticipated that uncertainties surrounding Brexit and other influences like the war in Ukraine, together with challenges in trading, inflation and labour shortages would impact 2023 trading. The company also experienced high energy price inflation and high staff costs (increase of Living Wage of nearly 10%). The directors sought to compensate for these challenges by increasing Average Rate by 10.97% whilst maintaining 2022 occupancy rates.
Principal risks and uncertainties
The company benefited from deferral of rent payments on hotel properties throughout 2023 however as explained above, in July 2024 the landlord re-assigned the contracts to a third party.
Key performance indicators
Our key performance Indicators for the year ended 31 December are set out below:
2023 2022 2021
Average Rate £84.63 £89.26 £82.27
Occupancy % 65.3% 65.2% 41.3%
Turnover £14.93m £13.32m £7.62m
Gross Profit % 72% 74% 77%
J S Salden
Director
23 September 2024
CFH UK HOLDING LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
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 the operation and management of hotels and other auxiliary services.
Results and dividends
The results for the year are set out on page 7.
No ordinary dividends were paid. 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:
S Jerushalmi
(Resigned 27 February 2023)
J S Salden
A Levy
(Appointed 27 February 2023)
Aroundtown Real Estate Management (UK) Ltd
(Appointed 27 February 2023)
Auditor
The auditor, Mercer & Hole LLP, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
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.
On behalf of the board
J S Salden
Director
23 September 2024
CFH UK HOLDING LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -
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;
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.
CFH UK HOLDING LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF CFH UK HOLDING LIMITED
- 4 -
Opinion
We have audited the financial statements of CFH UK Holding Limited (the 'company') for the year ended 31 December 2023 which comprise the profit and loss account, the statement of comprehensive income, the balance sheet, the statement of changes in equity, the statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
give a true and fair view of the state of the company's affairs as at 31 December 2023 and of its loss for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.
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
We draw attention to note 1.2 to the financial statements which describes how the ability of the Company to continue as a going concern is dependent on the ongoing support of its parent undertaking. The conditions that are set out in note 1.2 result in a material uncertainty that may cast significant doubt on the Company's ability to continue as a going concern. Our opinion is not modified in respect of this matter.
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.
CFH UK HOLDING LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF CFH UK HOLDING LIMITED (CONTINUED)
- 5 -
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.
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
Explanation as to what extent the audit was considered capable of detecting irregularities, including fraud
We gained an understanding of the legal and regulatory framework applicable to the company and the industry in which it operates and considered the risk of acts by the company that were contrary to applicable laws and regulations, including fraud. These included, but were not limited to, the Companies Act 2006, employment law, and tax legislation.
We evaluated management's incentives and opportunities for fraudulent manipulation of the financial statements and the financial report (including the risk of override of controls), and determined that the principal risks were related to posting inappropriate entries including journals to overstate revenue or understate expenditure and management bias in accounting estimates.
Audit procedures performed by the engagement team included:
discussions with management, including considerations of known or suspected instances of non- compliance with laws and regulations and fraud;
gaining an understanding of management's controls designed to prevent and detect irregularities; and
identifying and testing journal entries.
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.
CFH UK HOLDING LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF CFH UK HOLDING LIMITED (CONTINUED)
- 6 -
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 members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.
Andrew Turner
Senior Statutory Auditor
For and on behalf of Mercer & Hole LLP
23 September 2024
Chartered Accountants
Statutory Auditor
21 Lombard Street
London
EC3V 9AH
CFH UK HOLDING LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 7 -
2023
2022
Notes
£
£
Turnover
3
14,928,702
13,319,393
Cost of sales
(4,157,502)
(3,411,338)
Gross profit
10,771,200
9,908,055
Administrative expenses
(14,028,876)
(11,698,297)
Operating loss
4
(3,257,676)
(1,790,242)
Interest payable and similar expenses
7
(124,465)
(230,854)
Loss before taxation
(3,382,141)
(2,021,096)
Tax on loss
8
Loss for the financial year
(3,382,141)
(2,021,096)
The profit and loss account has been prepared on the basis that all operation are continued operations.
CFH UK HOLDING LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
- 8 -
2023
2022
£
£
Loss for the year
(3,382,141)
(2,021,096)
Other comprehensive income
-
-
Total comprehensive income for the year
(3,382,141)
(2,021,096)
CFH UK HOLDING LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2023
31 December 2023
- 9 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
10
41,613
355,547
Current assets
Stocks
11
102,254
85,013
Debtors
12
1,029,041
1,007,020
Cash at bank and in hand
496,568
663,353
1,627,863
1,755,386
Creditors: amounts falling due within one year
13
(13,898,612)
(10,957,928)
Net current liabilities
(12,270,749)
(9,202,542)
Net liabilities
(12,229,136)
(8,846,995)
Capital and reserves
Called up share capital
14
200
200
Profit and loss reserves
(12,229,336)
(8,847,195)
Total equity
(12,229,136)
(8,846,995)
These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.
The financial statements were approved by the board of directors and authorised for issue on 23 September 2024 and are signed on its behalf by:
J S Salden
Director
Company registration number 12242636 (England and Wales)
CFH UK HOLDING LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 10 -
Share capital
Profit and loss reserves
Total
£
£
£
Balance at 1 January 2022
200
(6,826,099)
(6,825,899)
Year ended 31 December 2022:
Loss and total comprehensive income
-
(2,021,096)
(2,021,096)
Balance at 31 December 2022
200
(8,847,195)
(8,846,995)
Year ended 31 December 2023:
Loss and total comprehensive income
-
(3,382,141)
(3,382,141)
Balance at 31 December 2023
200
(12,229,336)
(12,229,136)
CFH UK HOLDING LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 11 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
19
25,224
970,857
Investing activities
Purchase of tangible fixed assets
(192,009)
(287,653)
Proceeds from disposal of tangible fixed assets
55
Net cash used in investing activities
(192,009)
(287,598)
Financing activities
Repayment of borrowings
(456,989)
Net cash used in financing activities
-
(456,989)
Net (decrease)/increase in cash and cash equivalents
(166,785)
226,270
Cash and cash equivalents at beginning of year
663,353
437,083
Cash and cash equivalents at end of year
496,568
663,353
CFH UK HOLDING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 12 -
1
Accounting policies
Company information
CFH UK Holding Limited is a private company limited by shares incorporated in England and Wales. The registered office is 3rd Floor 1 Ashley Road, Altrincham, Cheshire, United Kingdom WA14 2DT.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
1.2
Going concern
Following a strategic review of the Company's operations, the Company ceased its operational contracts of the hotels and the landlord reassigned the contracts for the hotel operations to a third party in July 2024.
In assessing the appropriateness of the going concern assumption, the Directors have prepared detailed cash flow forecasts for the Company. These demonstrate that the Company has sufficient cash to meet its liabilities as they fall due however these forecasts are dependent on the parent undertaking providing further cash injections and also not seeking repayment of the amounts currently due from the Company. The parent undertaking has indicated that it will not demand repayment of these amounts within twelve months of the approval of these financial statements and will continue to provide support where necessary.
However on the basis that the company continues to generate losses and the trade has ceased post year end, there is no certainty that this support will continue. A material uncertainty therefore exists over the company's ability to continue as a going concern. The financial statements do not include any adjustments that would result from the basis of preparation being inappropriate.
1.3
Turnover
Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.
When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer, the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.
1.4
Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
CFH UK HOLDING LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 13 -
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Leasehold improvements
Length of lease
Plant and equipment
7 years
Fixtures and fittings
7 years
Computers
3 years
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
1.5
Impairment of fixed assets
At each reporting period end date, the company reviews the carrying amounts of its tangible 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.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
1.6
Stocks
Stocks represent hotel consumables and are stated at the lower of cost and estimated selling price less costs to complete and sell.
At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.
1.7
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
CFH UK HOLDING LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 14 -
1.8
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's balance sheet 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 debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Other financial assets
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
Impairment of financial assets
Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
CFH UK HOLDING LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 15 -
Basic financial liabilities
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Other financial liabilities
Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
1.9
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
1.10
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
CFH UK HOLDING LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 16 -
1.11
Leases
Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.
1.12
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.
2
Judgements and key sources of estimation uncertainty
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 where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
3
Turnover
2023
2022
£
£
Turnover analysed by class of business
Room
11,650,683
10,440,475
Food & Beverage
2,850,540
2,511,470
Miscellaneous
427,479
367,448
14,928,702
13,319,393
2023
2022
£
£
Turnover analysed by geographical market
United Kingdom
14,928,702
13,319,393
4
Operating loss
2023
2022
Operating loss for the year is stated after charging:
£
£
Exchange losses
25,718
40,931
Depreciation of owned tangible fixed assets
83,507
44,895
Impairment of owned tangible fixed assets
422,436
Operating lease charges
3,207,249
3,233,189
CFH UK HOLDING LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 17 -
5
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the company
43,300
40,500
For other services
Advisory services
2,850
2,700
Taxation services
3,450
3,240
6,300
5,940
6
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
145
123
Their aggregate remuneration comprised:
2023
2022
£
£
Wages and salaries
3,050,870
2,491,879
Social security costs
255,153
206,941
Pension costs
45,629
36,108
3,351,652
2,734,928
7
Interest payable and similar expenses
2023
2022
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
139,154
230,854
Other finance costs:
Other interest
(14,689)
124,465
230,854
CFH UK HOLDING LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 18 -
8
Taxation
The actual charge for the year can be reconciled to the expected credit for the year based on the profit or loss and the standard rate of tax as follows:
2023
2022
£
£
Loss before taxation
(3,382,141)
(2,021,096)
Expected tax credit based on the standard rate of corporation tax in the UK of 25.00% (2022: 19.00%)
(845,535)
(384,008)
Tax effect of expenses that are not deductible in determining taxable profit
19,625
Change in unrecognised deferred tax assets
845,535
404,598
Permanent capital allowances in excess of depreciation
(40,215)
Taxation charge for the year
-
-
A deferred tax asset has not been recognised in respect of losses on the basis that there is lack of certainty over future trading profits to use these against.
9
Impairments
Impairment tests have been carried out where appropriate and the following impairment losses have been recognised in profit or loss:
2023
2022
Notes
£
£
In respect of:
Property, plant and equipment
10
422,436
-
Recognised in:
Administrative expenses
422,436
-
CFH UK HOLDING LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 19 -
10
Tangible fixed assets
Leasehold improvements
Plant and equipment
Fixtures and fittings
Computers
Total
£
£
£
£
£
Cost
At 1 January 2023
179,120
72,553
63,950
94,491
410,114
Additions
53,070
109,362
25,531
4,046
192,009
At 31 December 2023
232,190
181,915
89,481
98,537
602,123
Depreciation and impairment
At 1 January 2023
3,803
6,277
4,937
39,550
54,567
Depreciation charged in the year
11,915
13,412
26,078
32,102
83,507
Impairment losses
210,667
149,232
52,075
10,462
422,436
At 31 December 2023
226,385
168,921
83,090
82,114
560,510
Carrying amount
At 31 December 2023
5,805
12,994
6,391
16,423
41,613
At 31 December 2022
175,317
66,276
59,013
54,941
355,547
More information on impairment movements in the year is given in note 9.
11
Stocks
2023
2022
£
£
Raw materials and consumables
102,254
85,013
12
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
718,292
625,547
Unpaid share capital
200
200
Amounts owed by group undertakings
7,628
275
Other debtors
77,053
128,937
Prepayments and accrued income
225,868
252,061
1,029,041
1,007,020
During the year, a provision of £54,114 (2022: £11,678) was recognised against trade debtors.
CFH UK HOLDING LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 20 -
13
Creditors: amounts falling due within one year
2023
2022
£
£
Trade creditors
568,466
451,074
Amounts owed to group undertakings
10,794,846
8,397,777
Taxation and social security
315,642
352,078
Other creditors
925
750
Accruals and deferred income
2,218,733
1,756,249
13,898,612
10,957,928
Amounts owed to group undertakings are unsecured, have no fixed date of repayment and are repayable on demand. Interest is charged on these amounts at a rate of 4.5% per annum.
14
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and not fully paid
Ordinary shares of £1 each
200
200
200
200
Each share carries with it voting rights, but no rights to any fixed income.
15
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
2023
2022
£
£
Within one year
2,432,467
3,241,280
Between two and five years
12,870,657
12,880,644
In over five years
36,448,000
39,664,000
51,751,124
55,785,924
16
Events after the reporting date
Following a strategic review of the Company's operations, the Company ceased its operational contracts of the hotels and the landlord reassigned the contracts for the hotel operations to a third party in July 2024.
17
Related party transactions
The Company is a wholly owned subsidiary and has taken advantage of the exemption permitted by FRS 102 Section 33 "Related Party Disclosures" not to provide disclosures of transactions entered into with other wholly owned members of the group.
There were no transactions during the period with related parties outside of the group.
CFH UK HOLDING LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 21 -
18
Ultimate controlling party
The immediate parent undertaking is Penta Holding GmbH, a company incorporated in Germany.
The ultimate parent undertaking is Centrifuge Holding GmbH, a company incorporated in the state of Berlin (Germany) with the registered address Sachsendamm 4/5, Berlin 10829, Germany.
Centrifuge Holding GmbH does prepare consolidated financial statements which will be published at the Bundesanzeiger and are therefore publicly available.
19
Cash generated from operations
2023
2022
£
£
Loss for the year after tax
(3,382,141)
(2,021,096)
Adjustments for:
Depreciation and impairment of tangible fixed assets
505,943
44,895
Movements in working capital:
Increase in stocks
(17,241)
(15,775)
Increase in debtors
(22,021)
(283,412)
Increase in creditors
2,940,684
3,246,245
Cash generated from operations
25,224
970,857
20
Analysis of changes in net funds
1 January 2023
Cash flows
31 December 2023
£
£
£
Cash at bank and in hand
663,353
(166,785)
496,568
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