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Registered number: 07443090














SYDNEY FOOD LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

 
SYDNEY FOOD LIMITED
 
 
COMPANY INFORMATION


Directors
A Alhadeff 
J M Buckland 
W Champion 
N Elliott 
L G Kaswell 
P Webber 
P M E Magyar 




Registered number
07443090



Registered office
5 Elstree Gate
Elstree Way

Borehamwood

Hertfordshire

WD6 1JD




Independent auditors
Sopher + Co LLP
Chartered Accountants & Statutory Auditors

5 Elstree Gate

Elstree Way

Borehamwood

Hertfordshire

WD6 1JD





 
SYDNEY FOOD LIMITED
 

CONTENTS



Page
Strategic Report
 
1 - 2
Directors' Report
 
3 - 4
Independent Auditors' Report
 
5 - 8
Statement of Comprehensive Income
 
9
Statement of Financial Position
 
10
Statement of Changes in Equity
 
11
Statement of Cash Flows
 
12
Analysis of Net Debt
 
13
Notes to the Financial Statements
 
14 - 25

 
SYDNEY FOOD LIMITED
 
 
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

Introduction
 
The directors present their Strategic Report for the year ended 31 December 2023.

Business review
 
2023 seen a significant increase in foot traffic inside the restaurants which resulted in increased revenue. In August 2022, the company opened its fifth restaurant site on Marylebone High Street. This year the Marylebone store has been operating at full capacity, which has contributed to the increase in revenue.
During 2023, turnover increased by 16% from £15.6m in 2022 to £18.07m in 2023. 
The business made a profit before tax this year of £77k (2022: loss before tax for the year of £389k). The loss before tax for 2022 includes £256k of pre-opening costs relating to the new site at Marylebone High Street.
The company generated cash from its underlying operations during the year of £14.7k compared to £1.05m in 2022 and after capital investment of £148k (2022: £1.94m), new loans of Nil (2022: £385k) and repayment of loan facilities of £344k (2022: £279k), cash balances held as at the balance sheet date were a healthy £1.02m (2022: £1.67m).
Cash balance at the end of 2023 was sufficient to pay loan instalments falling due in 2024 more than 3x.

Principal risks and uncertainties
 
Market Risk
Market risk is the risk of loss of trade as a result of factors affecting wider market and economy. Eating out at restaurants is a discretionary activity and in periods of economic downturn or uncertainty, there is a risk that trade will suffer.
Liquidity risk 
The company manages its cash and borrowing requirements to maximise interest income and minimise interest expense, whilst ensuring the company has sufficient liquid resources to meet the operating needs of the business.
Staff turnover and recruitment
The Restaurant industry as a whole has experienced staffing challenges which over the last few years were heightened by a tight labour market, in part down to Covid recovery and in part the effect of Brexit. 
In order to mitigate this risk as far as possible, the company ensures that staff are treated well and remuneration, is fair and competitive. Steps have been taken to sponsor employees from abroad and to source new staff in more creative ways. The business has seen an improvement of staff turnover by 19% from 98% in 2022 to 79% in 2023.

Page 1

 
SYDNEY FOOD LIMITED
 

STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

Financial key performance indicators
 
Gross profit margin has increased from 35.9% in 2022 to 37.6% in 2023. The industry has suffered cost increases due high inflation, energy price changes, plus food and supply chain increases due to shipping route disruptions in the Middle East. The impact of cost increases has been mitigated by careful planning and costing of menus, reducing waste and close stock control across all 5 restaurants. Menu price increases have been implemented where necessary bearing in mind the potential impact on customer demand.
EBITDA in 2023 was 4.3% compared to 2.9% in (after eliminating pre-opening cost) in 2022. 
The current ratio has remained the same in 2023 at 0.7 (2022: 0.7). The directors are satisfied that the company has sufficient liquid reserves (which are growing because of stronger performance) to continue trading for the foreseeable future.

Other key performance indicators
 
Average spend per customer increased by 4.3% from £21.36 in 2022 to £22.29 in 2023.
The company monitors operational labour costs as a % of turnover across all its sites. Statutory increases in costs (due to national living/minimum wage increases)  and labour market competition have put pressure on labour costs across the industry. In 2022 operational labour costs were over 42%. The Directors are pleased to note that this ratio was brought down to 40% in 2023. Further improvements in this metric are expected in 2024.


This report was approved by the board on 20 September 2024 and signed on its behalf.



A Alhadeff
Director
Page 2

 
SYDNEY FOOD LIMITED
 
 
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

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

Directors

The directors who served during the year were:

A Alhadeff 
J M Buckland 
W Champion 
N Elliott 
L G Kaswell 
P Webber 
P M E Magyar (appointed 12 October 2023)
W R Granger
The directors report with great sadness that the Company's founder, W R Granger, passed away on 25 December 2023.

Directors' responsibilities statement

The directors are responsible for preparing the Strategic Report, the Directors' 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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and 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 for the Company's financial statements and then apply them consistently;

make judgments 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 to enable them to ensure that the financial statements comply with the Companies Act 2006They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Results and dividends

The profit for the year, after taxation, amounted to £16,141 (2022 - loss £317,969).

No dividends were declared or paid during the year. A full review of the results for the year has been provided in the Strategic Report.

Page 3

 
SYDNEY FOOD LIMITED
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

Disclosure of information to auditors

Each of the persons who are directors at the time when this Directors' Report is approved has confirmed that:
 
so far as the directors is aware, there is no relevant audit information of which the Company's auditors are unaware, and

the directors has taken all the steps that ought to have been taken as a directors in order to be aware of any relevant audit information and to establish that the Company's auditors are aware of that information.

After date events

There have been no significant events affecting the Company since the year end.

Auditors

Under section 487(2) of the Companies Act 2006Sopher + Co LLP will be deemed to have been reappointed as auditors 28 days after these financial statements were sent to members or 28 days after the latest date prescribed for filing the accounts with the registrar, whichever is earlier.

This report was approved by the board on 20 September 2024 and signed on its behalf.
 





A Alhadeff
Director

Page 4

 
SYDNEY FOOD LIMITED
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SYDNEY FOOD LIMITED
 

Opinion


We have audited the financial statements of Sydney Food Limited (the 'Company') for the year ended 31 December 2023, 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 policiesThe financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).


In our opinion the financial statements:


give a true and fair view of the state of the 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.


Basis for opinion


We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the 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.


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.


Other information


The directors are responsible for the other information. The other information comprises the information included in the Annual Report, other than the financial statements and our Auditors' Report thereon. 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.


In connection with our audit of the financial statementsour 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 audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are
Page 5

 
SYDNEY FOOD LIMITED
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SYDNEY FOOD LIMITED (CONTINUED)

required to report that fact.


We have nothing to report in this regard.


Opinion on other matters prescribed by the Companies Act 2006
 

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


the information given in the 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.


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 directors' remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.


Responsibilities of directors
 

As explained more fully in the Directors' Responsibilities Statement set out on page 3, 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.


Auditors' responsibilities for the audit of the financial statements
 

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

 
Page 6

 
SYDNEY FOOD LIMITED
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SYDNEY FOOD LIMITED (CONTINUED)

Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows: 
 
the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations; 
we identified the laws and regulations applicable to the Company through discussions with directors and other management, and from our commercial knowledge and experience of the hospitality sector; 
we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the Company, including the Companies Act 2006, taxation legislation and data protection, anti-bribery, employment, environmental and health and safety legislation;
we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal correspondence; and 
identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit. 

We assessed the susceptibility of the Company’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by: 
 
making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; 
considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations; and 
understanding the design of the Company’s remuneration policies. 

To address the risk of fraud through management bias and override of controls, we: 
 
performed analytical procedures to identify any unusual or unexpected relationships; 
tested journal entries to identify unusual transactions; 
assessed whether judgements and assumptions made in determining the accounting estimates were indicative of potential bias; and 
investigated the rationale behind significant or unusual transactions. 

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to: 
 
agreeing financial statement disclosures to underlying supporting documentation; 
reading the minutes of meetings of those charged with governance; 
enquiring of management as to actual and potential litigation and claims; and 
reviewing correspondence with HMRC, relevant regulators and the Company’s legal advisors. 

There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any. 
Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.


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.


Page 7

 
SYDNEY FOOD LIMITED
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SYDNEY FOOD LIMITED (CONTINUED)

Use of our report
 

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





Stephen Iseman FCA (Senior Statutory Auditor)
  
for and on behalf of
Sopher + Co LLP
 
Chartered Accountants
Statutory Auditors
  
5 Elstree Gate
Elstree Way
Borehamwood
Hertfordshire
WD6 1JD

20 September 2024
Page 8

 
SYDNEY FOOD LIMITED
 
 
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023

2023
2022
Note
£
£

  

Turnover
 4 
18,066,675
15,627,503

Cost of sales
  
(11,277,726)
(10,024,458)

Gross profit
  
6,788,949
5,603,045

Administrative expenses
  
(6,557,950)
(5,857,948)

Other operating income
 5 
16,538
38,047

Operating profit/(loss)
 6 
247,537
(216,856)

Interest receivable and similar income
  
-
98

Interest payable and similar expenses
 10 
(170,916)
(172,251)

Profit/(loss) before tax
  
76,621
(389,009)

Tax on profit/(loss)
 11 
(60,480)
71,040

Profit/(loss) for the financial year
  
16,141
(317,969)

There was no other comprehensive income for 2023 (2022:£NIL).

The notes on pages 14 to 25 form part of these financial statements.
Page 9

 
SYDNEY FOOD LIMITED
REGISTERED NUMBER:07443090

STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2023

2023
2022
Note
£
£

Fixed assets
  

Tangible assets
 12 
4,218,994
4,614,772

Current assets
  

Stocks
 13 
106,200
107,386

Debtors
 14 
888,757
798,491

Bank and cash balances
  
1,021,307
1,668,466

  
2,016,264
2,574,343

Current liabilities
  

Creditors: amounts falling due within one year
 15 
(2,907,304)
(3,702,617)

Net current liabilities
  
 
 
(891,040)
 
 
(1,128,274)

Total assets less current liabilities
  
3,327,954
3,486,498

Creditors: amounts falling due after more than one year
 16 
(2,855,887)
(3,091,052)

Provisions for liabilities
  

Deferred tax
 18 
(138,833)
(78,353)

Net assets
  
333,234
317,093


Capital and reserves
  

Called up share capital 
 19 
600
600

Share premium account
 20 
1,330,144
1,330,144

Profit and loss account
 20 
(997,510)
(1,013,651)

  
333,234
317,093


The financial statements were approved and authorised for issue by the board and were signed on its behalf on 20 September 2024.




A Alhadeff
Director

The notes on pages 14 to 25 form part of these financial statements.
Page 10

 
SYDNEY FOOD LIMITED
 

STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023


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

£
£
£
£


At 1 January 2022
600
1,330,144
(695,682)
635,062



Loss for the year
-
-
(317,969)
(317,969)



At 1 January 2023
600
1,330,144
(1,013,651)
317,093



Profit for the year
-
-
16,141
16,141


At 31 December 2023
600
1,330,144
(997,510)
333,234


The notes on pages 14 to 25 form part of these financial statements.

Page 11

 
SYDNEY FOOD LIMITED
 

STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023

2023
2022
£
£

Cash flows from operating activities

Loss for the financial year
16,141
(317,969)

Adjustments for:

Depreciation of tangible assets
541,513
432,932

Loss on disposal of tangible assets
1,403
3,452

Interest payable
170,916
172,251

Interest receivable
-
(98)

Taxation charge
60,480
(71,040)

Decrease/(increase) in stocks
1,186
(12,455)

Increase in debtors
(90,266)
(134,432)

(Decrease)/increase in creditors
(762,547)
972,683

Net cash (used in)/generated from operating activities

(61,174)
1,045,324


Cash flows (used in)/from investing activities

Purchase of tangible fixed assets
(148,158)
(1,935,004)

Sale of tangible fixed assets
1,020
99

Interest received
-
98

Net cash used in investing activities

(147,138)
(1,934,807)

Cash flows from/(used in) financing activities

Repayment of bank loans
(319,321)
(279,192)

Other new loans
-
385,000

Repayment of other loans
(24,512)
-

Interest paid
(95,014)
(91,303)

Net cash (used in)/from financing activities
(438,847)
14,505

Net decrease in cash and cash equivalents
(647,159)
(874,978)

Cash and cash equivalents at beginning of year
1,668,466
2,543,444

Cash and cash equivalents at the end of year
1,021,307
1,668,466


Cash and cash equivalents at the end of year comprise:

Cash at bank and in hand
1,021,307
1,668,466


The notes on pages 14 to 25 form part of these financial statements.

Page 12

 
SYDNEY FOOD LIMITED
 

ANALYSIS OF NET DEBT
FOR THE YEAR ENDED 31 DECEMBER 2023




At 1 January 2023
Cash flows
At 31 December 2023
£

£

£

Cash at bank and in hand

1,668,466

(647,159)

1,021,307

Debt due after 1 year

(2,416,700)

180,306

(2,236,394)

Debt due within 1 year

(484,109)

163,528

(320,581)


(1,232,343)
(303,325)
(1,535,668)

The notes on pages 14 to 25 form part of these financial statements.
Page 13

 
SYDNEY FOOD LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

1.


General information

Sydney Food Limited is a private limited liability company incorporated in England and Wales, with its registered office at 5 Elstree Gate, Elstree Way, Borehamwood, Hertfordshire, WD6 1JD.
The principal activity of the company is the operation of restaurants.
The Company's functional and presentational currency is £ Sterling.

2.Accounting policies

 
2.1

Basis of preparation of financial statements

The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.

The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgment in applying the Company's accounting policies (see note 3).

The following principal accounting policies have been applied:

 
2.2

Going concern

The Company has continued to recover from the effects of the Covid-19 pandemic achieving an opearting profit and profit before taxation after three years of losses.
The directors have prepared forecasts which indicate that the company will be able to meet its liabilities as they fall due for a period of at least 12 months from the approval of the financial statements. These projections take a prudent view of the expected trade across the period.
The directors therefore have a reasonable expectation that the company has adequate resources to continue in operational existence and meet its liabilities as they fall due for the foreseeable future, being a period of at least twelve months from the date these financial statements were approved. Accordingly, they continue to adopt the going concern basis in preparing the financial statements.

 
2.3

Turnover

Turnover comprises restaurant sales which are recognised at the point of sale.

 
2.4

Operating leases: the Company as lessee

Rentals paid under operating leases are charged to profit or loss on a straight-line basis over the lease term.

Benefits received and receivable as an incentive to sign an operating lease are recognised on a straight-line basis over the lease term, unless another systematic basis is representative of the time pattern of the lessee's benefit from the use of the leased asset.

Page 14

 
SYDNEY FOOD LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.5

Government grants

Grants are accounted under the accruals model as permitted by FRS 102.
Grants of a revenue nature are recognised in the Statement of Comprehensive Income in the same period as the related expenditure.

 
2.6

Interest income

Interest income is recognised in profit or loss using the effective interest method.

 
2.7

Finance costs

Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.

 
2.8

Pensions

Defined contribution pension plan
The Company contributes to a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations.
The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Statement of Financial Position. The assets of the plan are held separately from the Company in independently administered funds.

 
2.9

Holiday pay accrual

A liability is recognised to the extent of any unused holiday pay entitlement which is accrued at the reporting date and carried forward to future periods. This is measured at the undiscounted salary cost of the future holiday entitlement so accrued at the reporting date.

 
2.10

Current and deferred taxation

The tax expense for the year comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.
The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the Company operates and generates income.
Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the reporting date, except that:
 - The recognition of deferred tax assets is limited to the extent that it is probable that they will be     recovered against the reversal of deferred tax liabilities or other future taxable profits; and
 - Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.

Page 15

 
SYDNEY FOOD LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.11

Tangible fixed assets

Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

At each reporting date the Company assesses whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined which is the higher of its fair value less costs to sell and its value in use. An impairment loss is recognised where the carrying amount exceeds the recoverable amount.

Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives.

Depreciation is provided on the following basis:

Short-term leasehold property
-
straight line over the life of lease
Plant and machinery
-
straight line over 3 - 5 years
Fixtures and fittings
-
straight line over 7 years
Design fees
-
straight line over 3 years

The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.

 
2.12

Stocks

Stocks are valued at the lower of cost and net realisable value after making due allowance for out of date and slow moving stocks.

 
2.13

Debtors

Short-term debtors are measured at the transaction price.

 
2.14

Cash and cash equivalents

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.

In the Statement of Cash Flows, cash and cash equivalents are shown net of bank overdrafts that are repayable on demand and form an integral part of the Company's cash management.

 
2.15

Creditors

Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.

Page 16

 
SYDNEY FOOD LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.16

Provisions for liabilities

Provisions are recognised when an event has taken place that gives rise to a legal or constructive obligation, a transfer of economic benefits is probable and a reliable estimate can be made.
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.
 
Increases in provisions are generally charged as an expense to profit or loss.

 
2.17

Financial instruments

The Company only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks, shareholders and other third parties.


3.


Judgments in applying accounting policies and key sources of estimation uncertainty

In the application of the accounting policies, the directors are required to make significant judgements, estimates and assumptions about the carrying amounts of assets that are not readily available from other sources. The estimates and assumptions are based on historic experience and other factors that are considered to be relevant. The items in the financial statements where these judgments and estimates have been made include:
Tangible assets
Critical estimates are made by the directors as regards depreciation rates for tangible assets and their residual values.
Impairment reviews
At each financial year end, the company assesses whether there is an indication that the non-financial assets may be impaired. If such an indication is identified, the company estimates the recoverable amount of these assets, comparing it to the carrying amount of the assets as at year end. If the carrying amount of the asset is higher than the recoverable amount, the company should recognise an impairment on the asset.
Applying the company's accounting policies
In the process of applying the company's accounting policies, management has made judgements as regards the impairment of assets.

Page 17

 
SYDNEY FOOD LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

4.


Turnover

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


2023
2022
£
£

Food sales
12,879,157
10,865,103

Drink sales
5,163,789
4,713,638

Catering/event sales
16,818
43,087

Merchandise sales
6,911
5,675

18,066,675
15,627,503


All turnover arose within the United Kingdom.


5.


Other operating income

2023
2022
£
£

Government grants receivable
-
38,047

Insurance claims receivable
16,538
-

16,538
38,047



6.


Operating profit/(loss)

The operating profit/(loss) is stated after charging:

2023
2022
£
£

Depreciation of tangible fixed assets
541,514
432,932

Loss on the disposal of fixed assets
1,403
3,452

Defined contribution pension cost
110,562
125,841

Other operating lease rentals
1,380,354
1,311,674


7.


Auditors' remuneration

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


2023
2022
£
£

Fees payable to the Company's auditors for the audit of the Company's financial statements
17,000
17,000

Fees payable to the Company's auditor for non-audit services
8,000
8,000
Page 18

 
SYDNEY FOOD LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

8.


Employees

Staff costs, including directors' remuneration, were as follows:


2023
2022
£
£

Wages and salaries
6,845,483
6,118,007

Social security costs
484,385
504,558

Cost of defined contribution scheme
110,562
125,841

7,440,430
6,748,406


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


        2023
        2022
            No.
            No.







Directors
7
7



Restaurant staff
367
318

374
325


9.


Directors' remuneration

2023
2022
£
£

Directors' emoluments
169,502
160,515

Company contributions to defined contribution pension schemes
10,330
27,579

179,832
188,094



10.


Interest payable and similar expenses

2023
2022
£
£


Bank interest payable
88,288
79,975

Other loan interest payable
82,628
92,276

170,916
172,251

Page 19

 
SYDNEY FOOD LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

11.


Taxation


2023
2022
£
£

Corporation tax


Current tax on profits for the year
-
-


Deferred tax


Origination and reversal of timing differences
60,480
(71,040)


Tax on profit/(loss)
60,480
(71,040)

Factors affecting tax charge for the year

The tax assessed for the year is higher than (2022 - higher than) the composite (2022 - standard) rate of corporation tax in the UK of 23.52% (2022 - 19%). The differences are explained below:

2023
2022
£
£


Profit/(loss) on ordinary activities before tax
76,621
(389,009)


Profit/(loss) on ordinary activities multiplied by the composite (2022 - standard) rate of corporation tax in the UK of 23.52% (2022 - 19%)
18,021
(73,912)

Effects of:


Expenses not deductible for tax purposes
235
-

Capital allowances for year in excess of depreciation
70,662
(125,746)

Utilisation of tax losses
(87,672)
-

Short-term timing difference leading to an increase in taxation
165
484

Other timing differences leading to an decrease in taxation
(1,411)
(1,140)

Deferred taxation
60,480
(71,040)

Unrelieved tax losses carried forward
-
200,314

Total tax charge for the year
60,480
(71,040)


Factors that may affect future tax charges

The Company has losses of £802,110 (2022 - £1,174,858) available to carry forward against future profits.

Page 20

 
SYDNEY FOOD LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

12.


Tangible fixed assets





Short-term leasehold property
Plant and machinery
Fixtures and fittings
Total

£
£
£
£



Cost


At 1 January 2023
5,745,660
1,079,286
900,353
7,725,299


Additions
-
68,804
79,354
148,158


Disposals
-
(4,060)
(901)
(4,961)



At 31 December 2023

5,745,660
1,144,030
978,806
7,868,496



Depreciation


At 1 January 2023
1,877,072
758,825
474,630
3,110,527


Charge for the year on owned assets
341,871
102,538
97,104
541,513


Disposals
-
(2,538)
-
(2,538)



At 31 December 2023

2,218,943
858,825
571,734
3,649,502



Net book value



At 31 December 2023
3,526,717
285,205
407,072
4,218,994



At 31 December 2022
3,868,588
320,461
425,723
4,614,772

Included in fixtures and fittings is £86,479 (2022: £87,380) of artwork which is not depreciated.


13.


Stocks

2023
2022
£
£

Raw materials and consumables
106,200
107,386


Page 21

 
SYDNEY FOOD LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

14.


Debtors


2023
2022
£
£

Due after more than one year

Other debtors
186,114
186,114

Due within one year

Trade debtors
220,573
183,420

Other debtors
6,690
120

Called up share capital not paid
102
102

Prepayments and accrued income
475,278
428,735

888,757
798,491



15.


Creditors: Amounts falling due within one year

2023
2022
£
£

Bank loans
243,581
439,192

Other loans
77,000
44,917

Trade creditors
632,445
834,723

Other taxation and social security
403,316
973,817

Other creditors
297,667
218,412

Accruals and deferred income
1,253,295
1,191,556

2,907,304
3,702,617



16.


Creditors: Amounts falling due after more than one year

2023
2022
£
£

Bank loans
737,906
861,616

Other loans
283,488
340,083

Shareholders loans
1,215,000
1,215,000

Accruals and deferred income
619,493
674,353

2,855,887
3,091,052


Page 22

 
SYDNEY FOOD LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

17.


Loans


Analysis of the maturity of loans is given below:


2023
2022
£
£

Amounts falling due within one year

Bank loans
243,581
439,192

Other loans
77,000
44,917


320,581
484,109

Amounts falling due 1-2 years

Bank loans
243,581
628,283

Other loans
77,000
44,917


320,581
673,200

Amounts falling due 2-5 years

Bank loans
494,326
233,333

Other loans
206,488
231,000

Shareholders loans
1,215,000
1,215,000


1,915,814
1,679,333

Amounts falling due after more than 5 years

Other loans
-
64,167

2,556,976
2,900,809



18.


Deferred taxation




2023
2022


£

£






At beginning of year
(78,353)
(149,393)


Charged to profit or loss
(60,480)
71,040



At end of year
(138,833)
(78,353)

Page 23

 
SYDNEY FOOD LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
 
18.Deferred taxation (continued)

The provision for deferred taxation is made up as follows:

2023
2022
£
£


Accelerated capital allowances
341,593
374,125

Tax losses carried forward and other short-term timing differences
(202,760)
(295,772)

138,833
78,353


19.


Share capital

2023
2022
£
£
Allotted, called up and fully paid



1,530 (2022 - 1,530) Ordinary Class A shares of £0.10 each
153
153
1,470 (2022 - 1,470) Ordinary Class B shares of £0.10 each
147
147
1,620 (2022 - 1,620) Ordinary Class C shares of £0.10 each
162
162
1,380 (2022 - 1,380) Ordinary Class D shares of £0.10 each
138
138

600

600

Ordinary 'A' and Ordinary 'B' shares carry full voting rights and rights to pro rata dividend but no dividend rights on liquidation or exit and no rights to division of assets or proceeds of sale of assets or shares.
Ordinary 'C' and Ordinary 'D' shares carry no voting rights but full rights to dividends and a share of assets on winding up. There are no restrictions on the distribution of dividends and the repayment of capital.



20.


Reserves

Share premium account

The share premium reserve includes any premiums received on issue of share capital. Any transaction costs associated with the issuing of shares are deducted from share premium.

Profit and loss account

The profit and loss account includes all current and prior period retained profits and losses.

Page 24

 
SYDNEY FOOD LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

21.


Pension commitments

The Company contributes to a defined contributions pension scheme. The assets of the scheme are held separately from those of the Company  in an independently administered fund. The pension cost charge represents contributions payable by the Company to the fund and amounted to £110,562 (2022: £125,841). Contributions totalling £21,802 (2022: £19,897) were payable to the fund at the reporting date and are included in creditors.


22.


Commitments under operating leases

At 31 December 2023 the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:

2023
2022
£
£


Not later than 1 year
1,120,293
1,120,293

Later than 1 year and not later than 5 years
4,151,384
4,391,693

Later than 5 years
6,128,922
7,008,907

11,400,599
12,520,893


23.


Related party transactions

During the year, the Company paid £536,375 (2022: £462,993) in licensing fees and recharged £53,404 (2022: £13,902) of payroll costs to Granger Enterprises Limited, a company under common directorship of N Elliott and W Granger.
During the year, the company recharged £132,394 (2022: £80,544) of payroll costs to Bills Restaurants Pty Limited, a company under common control. 
As at the Statement of Financial Position date the company owed £1,518,600 (2022: £1,442,706) including unpaid interest to the directors. Interest of £75,900 (2022: £75,900) has been charged on these loans.
P Webber, W Champion and J Buckland, all directors of the Company, have jointly provided a guarantee of £220,000 (2022: £220,000) as security for the bank loans.
Only the directors are considered to be key management personnel. Total remuneration in respect of these individuals is given in note 9.

 
Page 25