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Registered number: 09581491














KNBY (UK) LIMITED
FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

 
KNBY (UK) LIMITED
 
 
COMPANY INFORMATION


Directors
J Kofi-Sam 
L Shutov 
S Pakula 




Company secretary
L Shutov



Registered number
09581491



Registered office
Bob Bob Ricard
1 Upper James Street

London

United Kingdom

W1F 9DF




Independent auditors
Sopher + Co LLP
Chartered Accountants & Statutory Auditors

5 Elstree Gate

Elstree Way

Borehamwood

Hertfordshire

WD6 1JD





 
KNBY (UK) LIMITED
 

CONTENTS



Page
Group Strategic Report
 
1 - 2
Directors' Report
 
3 - 4
Independent Auditors' Report
 
5 - 8
Consolidated Statement of Comprehensive Income
 
9
Consolidated Statement of Financial Position
 
10
Company Statement of Financial Position
 
11
Consolidated Statement of Changes in Equity
 
12
Company Statement of Changes in Equity
 
13
Consolidated Statement of Cash Flows
 
14 - 15
Consolidated Analysis of Net Debt
 
16
Notes to the Financial Statements
 
17 - 35


 
KNBY (UK) LIMITED
 
 
GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 30 JUNE 2023

Introduction
 
The directors present their group strategic report for the year ended 30 June 2023.

Business review
 
The directors are satisfied with the results for the year and the financial position at the year end. Turnover increased to  £12.7 million from £10.6 million in 2022. Profit before tax for the year was £283,969 compared to £1.3 million in 2022. The results for 2022 include £1.2m of interest payable waived.
Going concern
Having secured new funding arrangements, the Directors are of the opinion that the Group has the ability to withstand possible downside scenarios should they arise. Therefore, the Directors are of the opinion that the Group will continue to be able to meet its liabilities as they fall due for at least the 12 months following the date of their approval of the financial statements.    

Principal risks and uncertainties
 
The assessment of risks faced by the Group and the development of strategies for dealing with these risks is achieved on an ongoing basis through the way in which the Group is controlled and managed. The risk management process seeks to enable the early identification, evaluation and effective management of the key risks facing the businesses at an operational level and to operate internal controls, which adequately mitigate these risks. The Group regularly assesses its risk management activities to ensure good practice in all areas.
The principal risks and uncertainties are as follows:
- Competitive Landscape: London is known for its vibrant restaurant scene, and the competition among upscale restaurants can be fierce. 
- Economic Factors: The current economic climate has impacted consumer spending habits, including the effect of fluctuations in currency exchange rates on overseas visitors.
- Cost Management: The company has implemented systems and procedures to help mitigate the impact of increases in operating costs, including staff wages, quality ingredients, and maintaining an elegant atmosphere. Ensuring effective cost management through efficient procurement, stock control, and optimisation of staff numbers is crucial for maintaining profitability.
- Staffing and Training: Hiring and retaining skilled staff, including chefs, sommeliers, and waitstaff, can be a challenge. There is a risk of staff turnover, which can impact service quality and customer satisfaction. Providing competitive salaries, creating a positive work environment, and investing in staff training and development can help mitigate this risk.
- Regulatory and Compliance: The restaurant industry is subject to various regulations and compliance requirements, such as health and safety standards, food hygiene regulations, licensing, and employment laws. Failing to comply with these regulations can result in penalties, reputational damage, or even closure. Staying updated on the relevant regulations and maintaining strict compliance is essential.
- Customer Preferences and Trends: Consumer preferences and dining trends can evolve rapidly, and it is important to adapt to changing customer demands, such as dietary preferences, sustainability, or technology integration, to maintain relevance and a strong customer base.
- Online Reputation Management: In today's digital age, online reviews and social media presence play a significant role in shaping a restaurant's reputation. Negative reviews or poor social media management can harm a restaurant's image and deter potential customers. Actively managing customer feedback and reviews is essential to maintaining a positive reputation.

Page 1

 
KNBY (UK) LIMITED
 

GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023

Financial key performance indicators (''KPIs'')
 
In line with our operating objectives, we use both financial and non-financial KPIs. Where relevant, KPIs are used as our primary measure of whether we are achieving our objectives. However, the scale and size of our operations means that we use many other detailed performance measures in addition to KPIs. We also use KPIs to measure performance against our primary objective of growing our business to create value for the shareholder. We use qualitative assessments to judge progress against our objectives in areas where numerical measures are less relevant.
The KPIs used to measure performance include turnover growth year on year, gross profit margin and adjusted EBITDA margin. We benchmark these measures against the appropriate industry competitors and make the necessary controls to ensure that we achieve our target ratios. 

Other key performance indicators
 
The directors consider the number of future bookings of the private dining area and reviews by customers on  third party websites as their key non-financial performance indicators.


This report was approved by the board on 11 September 2024 and signed on its behalf.



S Pakula
Director

Page 2

 
KNBY (UK) LIMITED
 
 
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2023

The directors present their report and the financial statements for the year ended 30 June 2023.

Results and dividends

The profit for the year, after taxation, amounted to £184,083 (2022 - £1,263,404).

The directors do not recommend a dividend for the year (2022 - £Nil).

Directors

The directors who served during the year were:

J Kofi-Sam 
L Shutov 
S Pakula was appointed as a director on 24 August 2023.

Directors' responsibilities statement

The directors are responsible for preparing the Group Strategic Report, the Directors' Report and the consolidated 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 the Group and of the profit or loss of the Group for that period.

 In preparing these financial statements, the directors are required to:


select suitable accounting policies for the Group'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 Group 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 the Group 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 the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

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 director is aware, there is no relevant audit information of which the Company and the Group's auditors are unaware, and

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

Page 3

 
KNBY (UK) LIMITED
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023

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 11 September 2024 and signed on its behalf.
 





S Pakula
Director

Page 4

 
KNBY (UK) LIMITED
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF KNBY (UK) LIMITED
 

Opinion


We have audited the financial statements of KNBY (UK) Limited (the 'parent Company') and its subsidiaries (the 'Group') for the year ended 30 June 2023, which comprise the Group Statement of Comprehensive Income, the Group and Company Statements of Financial Position, the Group Statement of Cash Flows, the Group and Company 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 Group's and of the parent Company's affairs as at 30 June 2023 and of the Group's 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 Group 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.


Emphasis of matter


In forming our opinion we have considered the adequacy of the disclosures concerning the preparation of the financial statements on a going concern basis set out in Note 2.3. In view of the significance of this matter we consider that it should be brought to your attention but our opinion is not qualified in this respect.


Conclusions relating to going concern


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


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


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


Page 5

 
KNBY (UK) LIMITED
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF KNBY (UK) LIMITED (CONTINUED)

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 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 Group 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 Group 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 Group and the parent Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group 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 by the parent Company, or returns adequate for our audit have not been received from branches not visited by us; or
the parent Company 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 Group's and the parent Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Group or the parent Company or to cease operations, or have no realistic alternative but to do so.


Page 6

 
KNBY (UK) LIMITED
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF KNBY (UK) LIMITED (CONTINUED)

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 Group 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:

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 Group 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 Group, 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 Group’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 Group’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; 
enquiring of management as to actual and potential litigation and claims; and
reviewing correspondence with HMRC, relevant regulators and the Group’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.
Page 7

 
KNBY (UK) LIMITED
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF KNBY (UK) LIMITED (CONTINUED)

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.


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

24 September 2024
Page 8

 
KNBY (UK) LIMITED
 
 
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2023

2023
2022
Note
£
£

  

Turnover
 4 
12,659,402
10,589,365

Cost of sales
  
(8,395,276)
(7,628,662)

Gross profit
  
4,264,126
2,960,703

Administrative expenses
  
(3,341,508)
(2,259,036)

Other operating income
 5 
58,210
202,571

Operating profit
 6 
980,828
904,238

Interest receivable and similar income
  
735
-

Interest payable and similar expenses
 10 
(697,594)
377,031

Profit before taxation
  
283,969
1,281,269

Tax on profit
 11 
(99,886)
(17,865)

Profit for the financial year
  
184,083
1,263,404

Profit for the year attributable to:
  

Owners of the parent Company
  
184,083
1,263,404

  
184,083
1,263,404

The notes on pages 17 to 35 form part of these financial statements.

Page 9

 
KNBY (UK) LIMITED
REGISTERED NUMBER:09581491

CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2023

2023
2022
Note
£
£

Fixed assets
  

Intangible assets
 13 
3,767,309
-

Tangible assets
 14 
6,015,973
4,135,781

Current assets
  

Stocks
 16 
693,125
613,383

Debtors: amounts falling due after more than one year
 17 
85,748
-

Debtors: amounts falling due within one year
 17 
1,762,201
2,043,407

Bank and cash balances
  
740,276
1,579,710

  
3,281,350
4,236,500

Current liabilities
  

Creditors: amounts falling due within one year
 18 
(16,616,683)
(13,116,203)

Net current liabilities
  
 
 
(13,335,333)
 
 
(8,879,703)

Total assets less current liabilities
  
(3,552,051)
(4,743,922)

Creditors: amounts falling due after more than one year
 19 
(2,372,489)
(1,464,587)

Provisions for liabilities
  

Deferred taxation
 21 
(1,135,588)
(791,421)

Net liabilities
  
(7,060,128)
(6,999,930)


Capital and reserves
  

Called up share capital 
 22 
5
5

Revaluation reserve
  
3,053,511
3,297,792

Profit and loss account
  
(10,113,644)
(10,297,727)

  
(7,060,128)
(6,999,930)


The financial statements were approved and authorised for issue by the board and were signed on its behalf on 11 September 2024.




S Pakula
Director

The notes on pages 17 to 35 form part of these financial statements.

Page 10

 
KNBY (UK) LIMITED
REGISTERED NUMBER:09581491

COMPANY STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2023

2023
2022
Note
£
£

Fixed assets
  

Investments
 15 
445,132
5

Current assets
  

Debtors: amounts falling due within one year
 17 
2,678,480
3,436,723

Bank and cash balances
  
65,808
14,692

  
2,744,288
3,451,415

Current liabilities
  

Creditors: amounts falling due within one year
 18 
(12,741,340)
(12,811,529)

Net current liabilities
  
 
 
(9,997,052)
 
 
(9,360,114)

Total assets less current liabilities
  
(9,551,920)
(9,360,109)

Creditors: amounts falling due after more than one year
 19 
(807,496)
-

Net liabilities
  
(10,359,416)
(9,360,109)


Capital and reserves
  

Called up share capital 
 22 
5
5

Profit and loss account carried forward
  
(10,359,421)
(9,360,114)

  
(10,359,416)
(9,360,109)


The financial statements were approved and authorised for issue by the board and were signed on its behalf on 11 September 2024.


S Pakula
Director

The notes on pages 17 to 35 form part of these financial statements.

Page 11

 
KNBY (UK) LIMITED
 

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2023


Called up share capital
Revaluation reserve
Profit and loss account
Total equity

£
£
£
£


At 1 July 2021
5
3,297,792
(11,561,131)
(8,263,334)



Profit for the year
-
-
1,263,404
1,263,404



At 1 July 2022
5
3,297,792
(10,297,727)
(6,999,930)



Profit for the year
-
-
184,083
184,083

Deferred tax movement (due to change in tax rates)
-
(244,281)
-
(244,281)


At 30 June 2023
5
3,053,511
(10,113,644)
(7,060,128)


The notes on pages 17 to 35 form part of these financial statements.

Page 12

 
KNBY (UK) LIMITED
 

COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2023


Called up share capital
Profit and loss account
Total equity

£
£
£


At 1 July 2021
5
(9,574,552)
(9,574,547)



Profit for the year
-
214,438
214,438



At 1 July 2022
5
(9,360,114)
(9,360,109)



Loss for the year
-
(999,307)
(999,307)


At 30 June 2023
5
(10,359,421)
(10,359,416)


The notes on pages 17 to 35 form part of these financial statements.

Page 13

 
KNBY (UK) LIMITED
 

CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2023

2023
2022
£
£

Cash flows from operating activities

Profit for the financial year
184,083
1,263,404

Adjustments for:

Amortisation of intangible assets
96,459
-

Depreciation of tangible assets
439,221
392,790

Interest paid
697,594
(377,031)

Interest received
(735)
-

Taxation charge
99,886
17,865

Increase in stocks
(79,742)
(355,138)

Increase in debtors
(364,738)
(753,349)

Decrease/(increase) in amounts owed by group
687,880
(697,301)

(Decrease)/increase in creditors
(155,973)
326,763

(Decrease)/increase in amounts owed to groups
(692,778)
3,500,006

Loan interest waived
-
1,199,589

Net cash generated from operating activities

911,157
4,517,598


Cash flows from investing activities

Purchase of intangible fixed assets
(5,393)
-

Purchase of tangible fixed assets
(152,396)
(635,874)

Purchase of subsidiary
(445,135)
-

Interest received
735
-

Cash acquired on purchase of subsidiary
50,324
-

Net cash outflow from investing activities

(551,865)
(635,874)
Page 14

 
KNBY (UK) LIMITED
 

CONSOLIDATED STATEMENT OF CASH FLOWS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023


2023
2022

£
£



Cash flows from financing activities

New secured loans
811,968
-

Repayment of loans
-
(38,929)

Repayment of other loans
(1,313,100)
(2,686,900)

Interest paid
(697,594)
(822,558)

Net cash used in financing activities
(1,198,726)
(3,548,387)

Net (decrease)/increase in cash and cash equivalents
(839,434)
333,337

Cash and cash equivalents at beginning of year
1,579,710
1,246,373

Cash and cash equivalents at the end of year
740,276
1,579,710


Cash and cash equivalents at the end of year comprise:

Cash at bank and in hand
740,276
1,579,710


The notes on pages 17 to 35 form part of these financial statements.

Page 15

 
KNBY (UK) LIMITED
 

CONSOLIDATED ANALYSIS OF NET DEBT
FOR THE YEAR ENDED 30 JUNE 2023




At 1 July 2022
Cash flows
At 30 June 2023
£

£

£

Cash at bank and in hand

1,579,710

(839,434)

740,276

Debt due after 1 year

(1,207,247)

(457,943)

(1,665,190)

Debt due within 1 year

(4,970,704)

(3,789,612)

(8,760,316)


(4,598,241)
(5,086,989)
(9,685,230)

The notes on pages 17 to 35 form part of these financial statements.

Page 16

 
KNBY (UK) LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

1.


General information

KNBY (UK) Limited is a private company, limited by shares, incorporated in England and Wales, with its registered office and principal place of business at Bob Bob Ricard, 1-3 Upper James Street, London, W1F 9DF.
The principal activity of the Group is that of restaurant operation.

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 Group management to exercise judgment in applying the Group's accounting policies (see note 3).

The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of Comprehensive Income in these financial statements.

The following principal accounting policies have been applied:

 
2.2

Basis of consolidation

The consolidated financial statements present the results of the Company and its own subsidiaries ("the Group") as if they form a single entity. Intercompany transactions and balances between group companies are therefore eliminated in full. Subsidiaries that are no longer under the control of the group are excluded from the group accounts from the date on which control ceased. The results of subsidiaries that are subsequently excluded from consolidation are included up to the date control ceased.

 
2.3

Going concern

The group meets its day to day working capital requirements through secured bank funding and unsecured, interest-free loan finance provided by L Shutov, a director of the Company. The directors  have obtained sufficient assurances from these parties of their ongoing commitment to maintain adequate funding for at least twelve months from the date of approval of these financial statements. On this basis, and having given due consideration to the Group's forecasts and projections, the directors believe that the Group will have adequate resources to continue in operational existence for the foreseeable future and consider it appropriate to adopt the going concern basis in preparing these financial statements. In the absence of this continued financial support the going concern basis may be invalid and adjustments would have to be made to reduce the value of assets to their recoverable amount, to reclassify fixed assets as current assets and long term liabilities as current liabilities and to provide for any further liabilities that may arise.

 
2.4

Turnover

Turnover comprises amounts receivable for restaurant sales, exclusive of Value Added Tax.
Restaurant sales are recognised at the point of sale. 

Page 17

 
KNBY (UK) LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

2.Accounting policies (continued)

 
2.5

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.

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
-
over the period of the lease
Plant and machinery
-
33.33% straight line
Fixtures and fittings
-
20% straight line
Office equipment
-
20% straight line

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 amounts and are recognised in the Consolidated Statement of Comprehensive Income.

 
2.6

Valuation of investments

Investments in subsidiaries are measured at cost less accumulated impairment.

 
2.7

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.

 
2.8

Debtors

Short term debtors are measured at the transaction price, less any impairment.

 
2.9

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. In the Consolidated 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 Group's cash management.

 
2.10

Financial instruments

The Group only enters into basic financial instruments transactions that result in the recognition of financial assets and liabilities like trade and other accounts receivable and payable, loans from banks and other third parties and loans to related parties.
Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the Statement of Comprehensive Income.
 
Page 18

 
KNBY (UK) LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

2.Accounting policies (continued)


2.10
Financial instruments (continued)

Financial liabilities, including trade and other creditors and loans from ultimate parent company are initially recognised at cost price. If evidence identified of changes to the liabilities, an impairment gain is recognised in the Statement of Comprehensive Income.

 
2.11

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.

 
2.12

Foreign currency translation

Functional and presentation currency

The Company's functional and presentational currency is £ Sterling.

Transactions and balances

Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.

At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.

 
2.13

Finance costs

Finance costs are charged to the Statement of Comprehensive Income 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.

 
2.14

Operating leases: the Group 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 19

 
KNBY (UK) LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

2.Accounting policies (continued)

 
2.15

Pensions

Defined contribution pension plan
The Group contributes to a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Group pays fixed contributions into a separate entity. Once the contributions have been paid the Group has no further payment obligations.
The contributions are recognised as an expense in the Consolidated Statement of Comprehensive Income 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 Group in independently administered funds.

 
2.16

Government grants

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

 
2.17

Current and deferred taxation

The tax expense for the year comprises current and deferred tax. Tax is recognised in the Consolidated Statement of Comprehensive Income, 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 and the Group operate and generate income.
Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the Statement of Financial Position 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 20

 
KNBY (UK) LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

2.Accounting policies (continued)

 
2.18

Intangible assets

Goodwill

Goodwill represents the difference between amounts paid on the cost of a business combination and the acquirer’s interest in the fair value of the Group's share of its identifiable assets and liabilities of the acquiree at the date of acquisition. Subsequent to initial recognition, goodwill is measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is amortised on a straight-line basis to the Consolidated Statement of Comprehensive Income over its useful economic life.

Other intangible assets

Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.

All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.

 Amortisation is provided on the following bases:

Goodwill
-
10%
straight line
Website
-
33%
straight line

 
2.19

Revaluation of tangible fixed assets

Leasehold properties are carried at current year value at fair value at the date of the revaluation less any subsequent accumulated depreciation and subsequent accumulated impairment losses. Revaluations are undertaken with sufficient regularity to ensure the carrying amount does not differ materially from that which would be determined using fair value at the reporting date. Fair values are determined from market based evidence.
Revaluation gains and losses are recognised in other comprehensive income unless losses exceed the previously recognised gains or reflect a clear consumption of economic benefits, in which case the excess losses are recognised in profit or loss.

Page 21

 
KNBY (UK) LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

3.


Judgments in applying accounting policies and key sources of estimation uncertainty

In preparing these financial statements, the directors have made the following judgements:
a) Determine whether leases entered into by the Group are operating or finance leases. These decisions depend on an assessment of whether the risks and rewards of ownership have been transferred from the lessor to the lessee on a lease by lease basis.
b) Determine whether there are indicators of impairment of the Group's tangible and intangible assets. Factors taken into consideration in reaching such a decision include the economic viability and expected future financial performance of the asset.
In preparing these financial statements, the directors have considered the following key sources of estimation uncertainty:
Tangible and intangible assets are depreciated over their useful lives taking into account residual values, where appropriate. The actual lives of the assets and residual values are assessed annually and may vary depending on a number of factors. In re-assessing asset lives, factors such as technological innovation and maintenance programmes are taken into account. Residual value assessments consider issues such as future market conditions, the remaining life of the asset and estimated disposal values.


4.


Turnover

All turnover arose within the United Kingdom.


5.


Other operating income

2023
2022
£
£

Other operating income
54,792
36,815

Government furlough grants receivable
-
165,756

Sundry income
3,418
-

58,210
202,571



6.


Operating loss

The operating loss is stated after charging:

2023
2022
£
£

Exchange differences
1,790
1,663

Other operating lease rentals
1,156,747
1,098,742

Page 22

 
KNBY (UK) LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

7.


Auditors Remuneration

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




Fees payable to the Company's auditors for the audit of the consolidated and parent Company's financial statements
25,000
25,485


8.


Employees

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


Group
Group
Company
Company
2023
2022
2023
2022
£
£
£
£


Wages and salaries
4,249,880
3,306,446
367,038
163,215

Social security costs
451,663
327,697
54,475
22,228

Cost of defined contribution scheme
76,404
58,044
4,319
2,637

4,777,947
3,692,187
425,832
188,080


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



Group
Group
Company
Company
        2023
        2022
        2023
        2022
            No.
            No.
            No.
            No.









Management
2
2
2
2



Front of house, kitchen and other
139
113
-
-

141
115
2
2


9.


Directors' remuneration

2023
2022
£
£

Directors' emoluments
192,180
154,215

Group contributions to defined contribution pension schemes
2,642
2,637

194,822
156,852


During the year retirement benefits were accruing to 1 director (2022 - 1) in respect of defined contribution pension schemes.

Page 23

 
KNBY (UK) LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

10.


Interest payable and similar expenses

2023
2022
£
£


Bank interest payable
257,154
490,954

Other interest payable
440,440
331,604

Loan interest waived
-
(1,199,589)

697,594
(377,031)


11.


Taxation


2023
2022
£
£



Current tax on profits for the year
-
-

Deferred tax


Accelerated capital allowances
99,886
17,865

Taxation on profit on ordinary activities
 
99,886
 
17,865
Page 24

 
KNBY (UK) LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
 
11.Taxation (continued)


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 20.50% (2022 - 19%). The differences are explained below:

2023
2022
£
£


Profit on ordinary activities before tax
285,000
1,281,269


Profit/(loss) on ordinary activities multiplied by the composite (2022 - standard) rate of corporation tax in the UK of 20.50% (2022 - 19%)
58,425
243,441

Effects of:


Non-tax deductible amortisation of goodwill
19,774
-

Expenses not deductible for tax purposes
2,276
1,418

Capital allowances for year lower than/(in excess) of depreciation
18,502
(98,230)

Utilisation of tax losses
(78,295)
(238,437)

Adjustments to tax charge in respect of prior periods
-
331

Short term timing difference leading to an increase/(decrease) in taxation
27
(1,666)

Unrelieved tax losses carried forward
-
93,143

Under provision of tax for the year
(27,331)
-

Interest to connected parties unpaid
20,194
-

Other differences leading to an increase (decrease) in the tax charge
(13,572)
-

Deferred tax
99,886
17,865

Total tax charge for the year
99,886
17,865


Factors that may affect future tax charges

At the reporting date the Group had losses of approximately £3.9m (2022 -  £1.1m) available to carry forward against future trading profits. No provision has been made for a deferred tax asset in respect of these losses in excess of accelerated capital allowances and fair value movements in view of uncertainty as to when they may prove recoverable.


12.


Parent company profit for the year

The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of Comprehensive Income in these financial statements. The loss after tax of the parent Company for the year was £999,307 (2022 - profit £214,438).

Page 25

 
KNBY (UK) LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

13.


Intangible assets

Group and Company





Website
Goodwill
Total

£
£
£



Cost


Additions
5,393
-
5,393


On acquisition of subsidiaries
-
3,858,375
3,858,375



At 30 June 2023

5,393
3,858,375
3,863,768



Amortisation


Charge for the year on owned assets
-
96,459
96,459



At 30 June 2023

-
96,459
96,459



Net book value



At 30 June 2023
5,393
3,761,916
3,767,309



At 30 June 2022
-
-
-



Page 26

 
KNBY (UK) LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

14.


Tangible fixed assets

Group






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

£
£
£
£
£



Cost or valuation


At 1 July 2022
6,409,753
1,403,042
5,239,622
15,969
13,068,386


Additions
2,174
71,626
78,596
-
152,396


Acquisition of subsidiary
2,224,383
22,287
327,454
23,752
2,597,876



At 30 June 2023

8,636,310
1,496,955
5,645,672
39,721
15,818,658



Depreciation


At 1 July 2022
2,869,337
1,337,334
4,725,934
-
8,932,605


Charge for the year on owned assets
359,517
24,721
54,913
70
439,221


Acquisition of subsidiary
301,479
7,200
101,290
20,890
430,859



At 30 June 2023

3,530,333
1,369,255
4,882,137
20,960
9,802,685



Net book value



At 30 June 2023
5,105,977
127,700
763,535
18,761
6,015,973



At 30 June 2022
3,540,416
65,708
513,688
15,969
4,135,781






Cost or valuation at 30 June 2023 is as follows:

Short-term leasehold property
£


At cost
3,947,101
At valuation:

The valuation was carried out by the directors at the year on an open market basis.
4,689,209



8,636,310

Page 27

 
KNBY (UK) LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

           14.Tangible fixed assets (continued)

If the land and buildings had not been included at valuation they would have been included under the historical cost convention as follows:

2023
2022
£
£

Group


Cost
2,105,978
2,103,804

Accumulated depreciation
(1,588,676)
(1,325,360)

Net book value
517,302
778,444


15.


Fixed asset investments

Company





Investments in subsidiary companies

£



Cost


At 1 July 2022
5


Additions
445,131



At 30 June 2023
445,136





Subsidiary undertakings


The following were subsidiary undertakings of the Company:

Name

Principal activity

Class of shares

Holding

KNBY LND OP1 Limited
Operation of a restaurant
Ordinary
100%
KNBY LND PR1 Limited
Property rental within the group
Ordinary
100%
KNBY LND PR3 Limited
Property rental within the group
Ordinary
100%
KNBY LND OP4 Limited
Operation of a restaurant
Ordinary
100%
Folie Restaurant Limited
Operation of a restaurant
Ordinary
100%

The registered office address of the above subsidiaries is at 1-3 Upper James Street, London, W1F 9DF.

Page 28

 
KNBY (UK) LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

16.


Stocks

Group
Group
2023
2022
£
£

Food and beverage
693,125
613,383



17.


Debtors

Group
Group
Company
Company
2023
2022
2023
2022
£
£
£
£

Due after more than one year

Rent deposit
85,748
-
-
-

85,748
-
-
-


Group
Group
Company
Company
2023
2022
2023
2022
£
£
£
£

Due within one year

Trade debtors
198,595
232,176
-
-

Amounts owed by group undertakings
59,123
747,003
2,650,002
3,436,723

Other debtors
250,915
107,564
-
-

Prepayments and accrued income
1,253,568
956,664
28,478
-

1,762,201
2,043,407
2,678,480
3,436,723


The carrying value of all debtor balances above equates to fair value. No balances are impaired at the year end.
Amounts owed by group undertakings are unsecured, interest free, have no fixed date of repayment and are repayable on demand.

Page 29

 
KNBY (UK) LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

18.


Creditors: Amounts falling due within one year

Group
Group
Company
Company
2023
2022
2023
2022
£
£
£
£

Bank loans (Note 20)
707,849
353,824
322,108
-

Other loans
-
1,313,100
-
1,313,100

Trade creditors
2,160,785
1,596,826
-
-

Amounts owed to group undertakings
3,495,063
4,187,841
8,795,167
7,804,400

Other taxation and social security
565,564
358,195
-
-

Other creditors
8,084,380
3,364,201
3,258,245
3,303,780

Accruals and deferred income
1,603,042
1,942,216
365,820
390,249

16,616,683
13,116,203
12,741,340
12,811,529


Amounts owed to group undertakings are unsecured, interest free, have no fixed date of repayment and are repayable on demand.


19.


Creditors: Amounts falling due after more than one year

Group
Group
Company
Company
2023
2022
2023
2022
£
£
£
£

Bank loans (Note 20)
1,665,190
1,207,247
807,496
-

Accruals and deferred income
707,299
257,340
-
-

2,372,489
1,464,587
807,496
-




Page 30

 
KNBY (UK) LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

20.


Loans


Analysis of the maturity of loans is given below:


Group
Group
Company
Company
2023
2022
2023
2022
£
£
£
£

Amounts falling due within one year

Bank loans
707,849
353,824
322,108
-

Other loans
-
1,313,100
-
1,313,100

707,849
1,666,924
322,108
1,313,100

Amounts falling due 1-2 years

Bank loans
789,764
383,547
362,733
-

Amounts falling due 2-5 years

Bank loans
875,426
823,700
444,763
-

2,373,039
2,874,171
1,129,604
1,313,100


The bank facilities are secured by a fixed and floating charge on the Company's assets, and a composite guarantee provided by related entities.   

Page 31

 
KNBY (UK) LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

21.


Deferred taxation


Group



2023
2022


£

£






At beginning of year
(791,421)
(773,556)


Charged to profit or loss
(99,886)
(17,865)


Charged to other comprehensive income
(244,281)
-



At end of year
(1,135,588)
(791,421)

Company


2023
2022






At end of year
-
-
Group
Group
2023
2022
£
£

Accelerated capital allowances
(117,751)
(17,865)

Fair value movements
(1,017,837)
(773,556)

(1,135,588)
(791,421)


22.


Share capital

2023
2022
£
£
Allotted, called up and fully paid



5 (2022 - 5) Ordinary shares of £1 each
5
5


Page 32

 
KNBY (UK) LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

23.
 

Business combinations

On 17 April 2023 the Company acquired all the issued share capital of Folie Restaurant Ltd, a company registered in England and Wales.

Acquisition of Folie Restaurant Ltd

Recognised amounts of identifiable assets acquired and liabilities assumed

Book value
Fair value
£
£

Fixed Assets

Tangible
2,167,017
2,167,017

2,167,017
2,167,017

Current Assets

Debtors
127,687
127,687

Cash at bank and in hand
50,324
50,324

Total Assets
2,345,028
2,345,028

Creditors

Due within one year
(471,511)
(471,511)

Due after more than one year
(5,286,761)
(5,286,761)

Total Identifiable net liabilities
(3,413,244)
(3,413,244)


Goodwill
3,858,375

Total purchase consideration
445,131

Consideration

£


Cash
369,867

Directly attributable costs
75,264

Total purchase consideration
445,131

Page 33

 
KNBY (UK) LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

23.Business combinations (continued)

Cash outflow on acquisition

£


Purchase consideration settled in cash, as above
(369,867)

Directly attributable costs
(75,264)

(445,131)

Less: Cash and cash equivalents acquired
50,324

Net cash outflow on acquisition
(394,807)

The results of Folie Restaurant Ltd since acquisition are as follows:

Current period since acquisition
£

Turnover
-

Loss for the period since acquisition
(253,270)


24.


Pension commitments

The Group contributes to a defined contributions pension scheme. The assets of the scheme are held separately from those of the Group in an independently administered fund. The pension cost charge represents contributions payable by the Group to the fund and amounted to £71,566 (2022 - £55,406). Contributions totalling £23,752 (2022 - £21,285) were payable to the fund at the balance sheet date and included in creditors.


25.


Commitments under operating leases

At 30 June 2023 the Group and the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:


Group
Group
2023
2022
£
£

Not later than 1 year
1,435,311
1,090,311

Later than 1 year and not later than 5 years
5,741,244
4,361,244

Later than 5 years
18,124,531
13,632,087

25,301,086
19,083,642
Page 34

 
KNBY (UK) LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

26.


Related party transactions

At the reporting date the Company owed £3,258,245 (2022 - £3,303,780) jointly to L Shutov, a director of the Company, and N Blumenthal. During the year the Company was charged interest of £341,818 (2022 - £307,785) on the balance due. The balance oustanding is unsecured and repayable on demand.
At the reporting date the Group owed £8,052,255 (2022 - £3,303,780) jointly to L Shutov, a director of the Company, and N Blumenthal. The Group was charged interest of £440,325 (2022 - £307,785) on the balance due. The balance outstanding is unsecured and repayable on demand.
The Company has taken advantage of the exemption under FRS102 33.1A Related Party Disclosures not to disclose transactions entered into between two or more members of a group, provided that any subsidiary undertaking which is a party to the transaction is wholly owned by a member of that group.


27.


Controlling party

The ultimate parent undertaking is KNBY Limited, a company registered in the British Virgin Islands.
The directors regard L Shutov, a director of the company, as the ultimate controlling party.

 
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