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Registered number: 03131812










HOSPITALITY & CAPITAL MANAGEMENT LIMITED










ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 MARCH 2024

 
HOSPITALITY & CAPITAL MANAGEMENT LIMITED
 
 
COMPANY INFORMATION


Director
M H Manji 




Registered number
03131812



Registered office
200 High Street
Colliers Wood

London

SW19 2BH




Independent auditor
MHA
Chartered Accountants & Statutory Auditors

11 Merus Court

Meridian Business Park

Leicester

LE19 1RJ





 
HOSPITALITY & CAPITAL MANAGEMENT LIMITED
 

CONTENTS



Page
Strategic Report
 
1 - 2
Director's Report
 
3 - 4
Independent Auditor's Report
 
5 - 8
Profit and Loss Account
 
9
Balance Sheet
 
10 - 11
Statement of Changes in Equity
 
12
Statement of Cash Flows
 
13
Analysis of Net Debt
 
14
Notes to the Financial Statements
 
15 - 28

 
HOSPITALITY & CAPITAL MANAGEMENT LIMITED
 
 
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2024

Introduction
 
The principal activity of the Company during the year continued to be the operation of a chain of hotels.
 

Business review
 
The Profit and Loss Account for the year ended 31 March 2024, which is set out on page 9, shows a profit before taxation for the year of £2,300,606 (2023: £5,396,356). The Company operates a chain of 4 hotels in the UK which in aggregate delivered revenue of £10,787,383 (2023: £12,334,451), a decrease of 12.5%.
 
During the year, the Company disposed of its hotel operation in Burton to an associated sister Company as part of a debt finance restructure in the Group, meaning there are 3 hotels operations remaining in the Company. 

Principal risks and uncertainties
 
The principal risks facing the Company are set out below:
 
Finance
 
The Company having sufficient liquidity to pay for resources required to operate.

The cash flow for the Company is being closely monitored on a regular basis. The Director is confident that the current control and review of cash flows within the Company are adequate to ensure that the Company it able to meet working capital requirements.
 
Reduced profitability due to rising costs of wages and supplies.

The Company reviews costs regularly and enters in to fixed price contracts where appropriate to manage exposure to price inflation.

Economic climate
 
An uncertain economic climate can result in GDP decline and a fall in RevPar.
 
There is a detailed business planning process in place which considers many scenarios to help manage and mitigate risks surrounding the impact to the Company’s operations in the event of a slowing national economy.

Financial key performance indicators
 
The key performance indicators of the Company are as follows:
 
Turnover;
Gross profit; and
Profit before taxation
 
During the year, turnover has decreased by £1,547,068 (12.5%) to £10,787,383 compared to £12,334,451 in 2023.

During the year, gross profit has decreased by £1,280,093 (13.4%) to £8,241,229 compared to £9,521,322 in 2023.

During the year, profit before taxation has decreased by £3,095,750 (57.4%) to £2,300,606 compared to £5,396,356 in 2023.

Page 1

 
HOSPITALITY & CAPITAL MANAGEMENT LIMITED
 

STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024


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



................................................
M H Manji
Director

Date: 11 October 2024
Page 2

 
HOSPITALITY & CAPITAL MANAGEMENT LIMITED
 
 
 
DIRECTOR'S REPORT
FOR THE YEAR ENDED 31 MARCH 2024

The Director presents his report and the financial statements for the year ended 31 March 2024.

Results and dividends

The profit for the year, after taxation, amounted to £1,752,031 (2023: £5,016,612).

During the year no dividends were paid (2023: £Nil).

Director

The Director who served during the year was:

M H Manji 

Future developments

Post year end, the Company has the intention to transfer it's trade, assets and liabilities to an associate sister Company as part of a proposed restructuring of the Group's operations, see note 2.2 for further information.

Disclosure of information to auditor

The Director at the time when this Director's Report is approved has confirmed that:
 
so far as is aware, there is no relevant audit information of which the Company's auditor is unaware; and

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's auditor is aware of that information.

Post balance sheet events

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

Auditor

The auditor, MHAwill be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

Page 3

 
HOSPITALITY & CAPITAL MANAGEMENT LIMITED
 
 
 
DIRECTOR'S REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024

Director's responsibilities statement

The Director is responsible for preparing the Strategic Report, the Director's Report and the financial statements in accordance with applicable law and regulations.
 
Company law requires the Director to prepare financial statements for each financial year. Under that law the Director has 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 Director must not approve the financial statements unless he is 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 Director is required to:


select suitable accounting policies for the Company's financial statements and then apply them consistently;

make judgements and accounting estimates that are reasonable and prudent;

state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and

prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business.

The Director is 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 him to ensure that the financial statements comply with the Companies Act 2006He is 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.

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





................................................
M H Manji
Director

Date: 11 October 2024

200 High Street
Colliers Wood
London
SW19 2BH
Page 4

 
HOSPITALITY & CAPITAL MANAGEMENT LIMITED
 
 
 
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF HOSPITALITY & CAPITAL MANAGEMENT LIMITED
 

Opinion


We have audited the financial statements of Hospitality & Capital Management Limited (the 'Company') for the year ended 31 March 2024, which comprise the Profit and Loss Account, the Balance Sheet, the Statement of Cash Flows, the Statement of Changes in Equity and the related notes, including 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 March 2024 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 Auditor 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.


Emphasis of matter - Financial statements prepared on a basis other than going concern


We draw attention to note 2.2 to the financial statements which explains the Director's intention to transfer the trade, assets and liabilities to an associated sister company within the next 12 months, with the exceptions of those liabilites described in note 2.2. The Director therefore does not consider it to be appropriate to adopt the going concern basis of accounting in preparing the financial statements. Accordingly, the financial statements have been prepared on a basis other than going concern as described in note 2.2. Our opinion is not modified in respect of this matter.







Page 5

 
HOSPITALITY & CAPITAL MANAGEMENT LIMITED
 
 
 
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF HOSPITALITY & CAPITAL MANAGEMENT LIMITED (CONTINUED)


Other information


The other information comprises the information included in the Annual Report other than the financial statements and our Auditor's Report thereon. The Director is responsible for the other information contained within the Annual ReportOur opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.


We have nothing to report in this regard.


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 Director's Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the Strategic Report and the Director's 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 Director's 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 Director's 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 Director's Responsibilities Statement set out on page 4, the Director is 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 Director determines 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 Director is 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 Director either intends to liquidate the Company or to cease operations, or have no realistic alternative but to do so.


Page 6

 
HOSPITALITY & CAPITAL MANAGEMENT LIMITED
 
 
 
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF HOSPITALITY & CAPITAL MANAGEMENT LIMITED (CONTINUED)


Auditor responsibilities for the audit of the financial statements
 

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


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:
 
enquiry of management and those charged with governance around actual, potential or suspected litigation, claims, non-compliance with applicable laws and regulations and fraud;
enquiry of entity staff in tax and compliance functions and external advisors to identify any instances of non-compliance with laws and regulations; 
performing audit work over the risk of management override, including testing of journal entries and other adjustments for appropriateness, evaluating the business rationale of significant transactions outside the normal course of business and reviewing accounting estimates for bias;
reviewing of financial statements disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations; and 
discussions amongst the engagement team in relation to how and where fraud might occur in the financial statements and any potential indicators of fraud. 


Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.


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 Auditor's Report.
Page 7

 
HOSPITALITY & CAPITAL MANAGEMENT LIMITED
 
 
 
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF HOSPITALITY & CAPITAL MANAGEMENT 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 Auditor's Report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company's members, as a body, for our audit work, for this report, or for the opinions we have formed.





Shelley Harvey FCCA (Senior Statutory Auditor)
  
for and on behalf of MHA, Statutory Auditor
 
Leicester, United Kingdom
 

11 October 2024
MHA is the trading name of MacIntyre Hudson LLP, a limited liability partnership in England and Wales (registered number OC312313).
Page 8

 
HOSPITALITY & CAPITAL MANAGEMENT LIMITED
 
 
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 MARCH 2024

Continuing operations
Discontinued operations
Total
Continuing operations
Discontinued operations
Total
2024
2024
2024
2023
2023
2023
Note
£
£
£
£
£
£

  

Turnover
 4 
9,058,276
1,729,107
10,787,383
8,732,140
3,602,311
12,334,451

Cost of sales
  
(2,169,400)
(376,754)
(2,546,154)
(1,871,229)
(941,900)
(2,813,129)

Gross profit
  
6,888,876
1,352,353
8,241,229
6,860,911
2,660,411
9,521,322

Administrative expenses
  
(5,351,463)
(579,602)
(5,931,065)
(5,553,652)
(1,729,090)
(7,282,742)

Exceptional other operating charges
 10 
-
-
-
354,242
2,829,700
3,183,942

Operating profit
 5 
1,537,413
772,751
2,310,164
1,661,501
3,761,021
5,422,522

Interest payable and similar expenses
 8 
(4,313)
(5,245)
(9,558)
(3,959)
(22,207)
(26,166)

Profit before tax
  
1,533,100
767,506
2,300,606
1,657,542
3,738,814
5,396,356

Tax on profit
 9 
(348,752)
(199,823)
(548,575)
(284,808)
(94,936)
(379,744)

Profit for the financial year
  
1,184,348
567,683
1,752,031
1,372,734
3,643,878
5,016,612

There are no items of other comprehensive income for 2024 or 2023 other than the profit for the yearAs a result, no separate Statement of Comprehensive Income has been presented.

The notes on pages 15 to 28 form part of these financial statements.
Page 9

 
HOSPITALITY & CAPITAL MANAGEMENT LIMITED
REGISTERED NUMBER: 03131812

BALANCE SHEET
AS AT 31 MARCH 2024

2024
2023
Note
£
£

Fixed assets
  

Tangible assets
 11 
1,615,383
1,758,037

  
1,615,383
1,758,037

Current assets
  

Stocks
 12 
37,640
41,109

Debtors: amounts falling due within one year
 13 
9,761,325
8,724,345

Cash at bank and in hand
 14 
1,022,893
657,924

  
10,821,858
9,423,378

Current liabilities
  

Creditors: amounts falling due within one year
 15 
(3,093,274)
(3,589,479)

Net current assets
  
 
 
7,728,584
 
 
5,833,899

Total assets less current liabilities
  
9,343,967
7,591,936

  

Net assets
  
9,343,967
7,591,936


Capital and reserves
  

Called up share capital 
  
2
2

Profit and loss account
  
9,343,965
7,591,934

  
9,343,967
7,591,936

Page 10

 
HOSPITALITY & CAPITAL MANAGEMENT LIMITED
REGISTERED NUMBER: 03131812
    
BALANCE SHEET (CONTINUED)
AS AT 31 MARCH 2024

The financial statements were approved and authorised for issue by the board and were signed on its behalf by: 




................................................
M H Manji
Director

Date: 11 October 2024

The notes on pages 15 to 28 form part of these financial statements.
Page 11

 
HOSPITALITY & CAPITAL MANAGEMENT LIMITED
 

STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2024


Called up share capital
Profit and loss account
Total equity

£
£
£


At 1 April 2022
2
2,575,322
2,575,324


Comprehensive income for the year

Profit for the year
-
5,016,612
5,016,612



At 1 April 2023
2
7,591,934
7,591,936


Comprehensive income for the year

Profit for the year
-
1,752,031
1,752,031


At 31 March 2024
2
9,343,965
9,343,967


The notes on pages 15 to 28 form part of these financial statements.

Profit and loss account
Includes all current and prior year retained profits and losses. All amounts are distributable. 
Page 12

 
HOSPITALITY & CAPITAL MANAGEMENT LIMITED
 

STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2024

2024
2023
£
£

Cash flows from operating activities

Profit for the financial year
1,752,031
5,016,612

Adjustments for:

Depreciation of tangible assets
120,680
200,376

Interest paid
9,558
-

Taxation charge
548,575
379,744

Decrease in stocks
3,469
1,629

Increase in debtors
(4,800)
(31,020)

Increase in amounts owed by groups
(801,058)
(3,184,399)

(Decrease)/increase in creditors
(325,484)
1,070,733

Increase/(decrease) in amounts owed to groups
-
(3,183,790)

Corporation tax paid
(719,296)
(29,752)

Net cash generated from operating activities

583,675
240,133


Cash flows from investing activities

Purchase of tangible fixed assets
(209,148)
(239,135)

Net cash from investing activities

(209,148)
(239,135)

Cash flows from financing activities

Repayment of other loans
-
(43,808)

Interest paid
(9,558)
-

Net cash used in financing activities
(9,558)
(43,808)

Net increase/(decrease) in cash and cash equivalents
364,969
(42,810)

Cash and cash equivalents at beginning of year
657,924
700,734

Cash and cash equivalents at the end of year
1,022,893
657,924


Cash and cash equivalents at the end of year comprise:

Cash at bank and in hand
1,022,893
657,924

1,022,893
657,924


The notes on pages 15 to 28 form part of these financial statements.

Page 13

 
HOSPITALITY & CAPITAL MANAGEMENT LIMITED
 

ANALYSIS OF NET DEBT
FOR THE YEAR ENDED 31 MARCH 2024




At 1 April 2023
Cash flows
At 31 March 2024
£

£

£

Cash at bank and in hand

657,924

364,969

1,022,893


657,924
364,969
1,022,893

The notes on pages 15 to 28 form part of these financial statements.
Page 14

 
HOSPITALITY & CAPITAL MANAGEMENT LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

1.


General information

The entity is a private company, limited by shares, which is incorporated in England and Wales, registration number 03131812. The registered office is 200 High Street, Colliers Wood, London, SW19 2BH.
Principal activity
The principal activity of the Company during the year continued to be that of a chain of hotels.

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 judgement in applying the Company's accounting policies (see note 3).

The Company's functional and presentational currency is British Pound Sterling (£).

The following principal accounting policies have been applied:

 
2.2

Going concern

In considering the appropriateness of the going concern basis of preparation of these accounts, the Director has considered the current and future funding requirements of the Company. The Director makes this assessment in respect of a period of at least 12 months from the date of authorisation for issue of the financial statements.
 
The Director's intention is to transfer the trade, assets and liabilities into a sister company within 12 months of approval of the financial statements, therefore the financial statements have been prepared on a basis other than going concern. The amount due to HMRC in respect of VAT will remain in the company and will be guaranteed by the sister Company.
 
With an orderly transfer of the assets and liabilities of the Company to the associated sister Company, the intention is for the trading assets and liabilities of this Company to be transferred to the recipient at their carrying amounts. The Director anticipates that all liabilities will be settled in full and that the debtors will be recovered as they fall due, there would be no restatement of assets and liabilities required at the date of transfer.
 
If the intended transfer does not occur, then the Company will continue to trade as a going concern in its current form, with the support of the Ultimate Owner.

Page 15

 
HOSPITALITY & CAPITAL MANAGEMENT LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

2.Accounting policies (continued)

 
2.3

Revenue

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised:

Rendering of services

Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:
the amount of revenue can be measured reliably;
it is probable that the Company will receive the consideration due under the contract;
the stage of completion of the contract at the end of the reporting period can be measured reliably; and
the costs incurred and the costs to complete the contract can be measured reliably.

 
2.4

Operating leases: the Company as lessee

Rentals paid under operating leases are charged to the Profit and Loss Account on a straight-line basis over the lease term.

 
2.5

Finance costs

Finance costs are charged to the Profit and Loss Account 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.

 
2.6

Pensions

Defined contribution pension plan

The Company operates 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 the Profit and Loss Account when they fall due. Amounts not paid are shown in accruals as a liability in the Balance Sheet. The assets of the plan are held separately from the Company in independently administered funds.

Page 16

 
HOSPITALITY & CAPITAL MANAGEMENT LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

2.Accounting policies (continued)

 
2.7

Taxation

Tax is recognised in the Profit and Loss Account 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 tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the balance sheet 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 balance sheet 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.

Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

 
2.8

Exceptional items

Exceptional items are transactions that fall within the ordinary activities of the Company but are presented separately due to their size or incidence.

 
2.9

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.

Page 17

 
HOSPITALITY & CAPITAL MANAGEMENT LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

2.Accounting policies (continued)


2.9
Tangible fixed assets (continued)

Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.

Depreciation is provided on the following basis:

Leasehold property improvements
-
2% Straight-line per annum
Long-term leasehold property
-
Not depreciated
Plant and machinery
-
25% Straight-line per annum
Fixtures and fittings
-
25% Straight-line per annum
Computer equipment
-
25% Straight-line per annum
Assets under construction
-
Not depreciated

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 the Profit and Loss Account.

 
2.10

Stocks

Stocks are stated at the lower of cost and net realisable value, after making due allowance for obsolete and slow-moving stock.

 
2.11

Debtors

Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at transaction price, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.

 
2.12

Cash and cash equivalents

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice. 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.

 
2.13

Creditors

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

 
2.14

Holiday pay accrual

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

Page 18

 
HOSPITALITY & CAPITAL MANAGEMENT LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

2.Accounting policies (continued)

 
2.15

Financial instruments

Debt instruments (other than those wholly repayable or receivable within one year), including loans and other accounts receivable and payable, are initially measured at transaction price, net of transaction costs, and subsequently at amortised cost using the effective interest method. Debt instruments that are payable or receivable within one year, typically trade debtors and creditors, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received. However, if the arrangements of a short-term instrument constitute a  inancing transaction, like the payment of a trade debt deferred beyond normal business terms or in case of an out-right short-term loan that is not at market rate, the financial asset or liability is measured, initially at the present value of future cash flows discounted at a market rate of interest for a similar debt instrument and subsequently at amortised cost, unless it qualifies as a loan from a director in the case of a small company, or a public benefit entity concessionary loan.
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 Profit and Loss Account.
For financial assets measured at amortised cost, the impairment loss is measured as the difference between an asset's carrying amount and the present value of estimated cash flows discounted at the asset's original effective interest rate. If a financial asset has a variable interest rate, the discount rate  or measuring any impairment loss is the current effective interest rate determined under the contract.
For financial assets measured at cost less impairment, the impairment loss is measured as the difference between an asset's carrying amount and best estimate of the recoverable amount, which is an approximation of the amount that the Company would receive for the asset if it were to be sold at the balance sheet date.
Financial assets and liabilities are offset and the net amount reported in the Balance Sheet when there is an enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Page 19

 
HOSPITALITY & CAPITAL MANAGEMENT LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

3.


Judgements in applying accounting policies and key sources of estimation uncertainty

Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.
The Company makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are addressed below.
(i) Useful economic lives of tangible fixed assets
The annual depreciation charge for tangible fixed assets is sensitive to changes in the estimated useful economic lives and residual values of the assets. The useful economic lives and residual values are reassessed annually. They are amended when necessary to reflect current estimates, based on technological advancement, future investments, economic utilisation and the physical condition of the assets.
(ii) Impairment of financial assets
The Company makes an estimate of the recoverable value of trade and other debtors. When assessing impairment of trade and other debtors, management considers factors including the current credit rating of the debtor, the ageing profile of debtors and historical experience.


4.


Turnover

The whole of the turnover is attributable to the Company's principal activity.

All turnover arose within the United Kingdom.

Page 20

 
HOSPITALITY & CAPITAL MANAGEMENT LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

5.


Operating profit

The operating profit is stated after charging:

2024
2023
£
£

Depreciation of tangible fixed assets
120,680
200,376

Other operating lease rentals
2,188,333
2,455,000


6.


Auditor's remuneration

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


2024
2023
£
£

Fees payable to the Company's auditor for the audit of the Company's financial statements
25,000
26,000

Fees payable to the Company's auditor in respect of:

Taxation compliance services
2,000
2,000

Preperation of financial statements
3,000
3,000

Page 21

 
HOSPITALITY & CAPITAL MANAGEMENT LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

7.


Employees

Staff costs were as follows:


2024
2023
£
£

Wages and salaries
1,457,723
1,548,197

Social security costs
102,211
99,278

Cost of defined contribution scheme
22,802
25,887

1,582,736
1,673,362


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


        2024
        2023
            No.
            No.







Director
1
1



Administration
81
90

82
91

The Director received no remuneration for his services to the Company during the current or prior year.


8.


Interest payable and similar expenses

2024
2023
£
£


Other interest payable
9,558
26,166

9,558
26,166


9.


Taxation


2024
2023
£
£

Corporation tax


Current tax on profits for the year
548,575
379,744


Total current tax
548,575
379,744

Page 22

 
HOSPITALITY & CAPITAL MANAGEMENT LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
 
9.Taxation (continued)


Factors affecting tax charge for the year

The tax assessed for the year is higher than (2023 - lower than) the standard rate of corporation tax in the UK of 25% (2023:19%). The differences are explained below:

2024
2023
£
£


Profit on ordinary activities before tax
2,300,606
5,396,356


Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 25% (2023: 19%)
575,152
1,025,308

Effects of:


Expenses not deductible for tax purposes, other than goodwill amortisation and impairment
6,122
(597,765)

Capital allowances for year in excess of depreciation
(33,188)
(31,068)

Changes in provisions leading to an increase / (decrease) in the tax charge
489
(9)

Other differences leading to an increase / (decrease) in the tax charge
-
(16,722)

Total tax charge for the year
548,575
379,744

Page 23

 
HOSPITALITY & CAPITAL MANAGEMENT LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
 
9.Taxation (continued)


Factors that may affect future tax charges

From 1 April 2024, the corporation tax main rate remained at 25% for profits over £250,000. The small profits rate has also remained as at 19% for profits of £50,000 or less. Profits between £50,000 and £250,000 are still taxed at the main rate reduced by a marginal relief providing a gradual increase in the effective corporation tax rate.  


10.


Exceptional items

2024
2023
£
£


Write off of specific related party balances
-
(3,170,973)

Write off of unknown related party differences
-
(12,969)

-
(3,183,942)

The write off of specific related party balances relates to the agreed write off of related party balances with group companies and other entities under common control. These amounts were agreed with the respective entities and written off in both entities. 
The write off of unknown related party differences relates to unknown differences on balances with group companies and other entities under common control, these amounts have been written off to the Profit and Loss Account.

Page 24

 


 
HOSPITALITY & CAPITAL MANAGEMENT LIMITED


 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024


11.


Tangible fixed assets






Long-term leasehold property
Leasehold property improvements
Plant and machinery
Fixtures and fittings
Computer equipment
Assets under construction
Total

£
£
£
£
£
£
£



Cost or valuation


At 1 April 2023
4,670
1,429,009
262,011
785,935
56,769
157,011
2,695,405


Additions
-
-
171,415
30,229
7,504
-
209,148


Disposals
(4,670)
-
(162,131)
(625,047)
(29,304)
(107,520)
(928,672)



At 31 March 2024

-
1,429,009
271,295
191,117
34,969
49,491
1,975,881



Depreciation


At 1 April 2023
-
96,381
161,128
628,560
51,299
-
937,368


Charge for the year
-
27,880
40,730
46,875
5,195
-
120,680


Disposals
-
-
(111,477)
(557,325)
(28,748)
-
(697,550)



At 31 March 2024

-
124,261
90,381
118,110
27,746
-
360,498



Net book value



At 31 March 2024
-
1,304,748
180,914
73,007
7,223
49,491
1,615,383



At 31 March 2023
4,670
1,332,628
100,883
157,375
5,470
157,011
1,758,037

Page 25

 
HOSPITALITY & CAPITAL MANAGEMENT LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

12.


Stocks

2024
2023
£
£

Inventories
37,640
41,109

37,640
41,109



13.


Debtors

2024
2023
£
£


Trade debtors
95,097
157,561

Amounts owed by group undertakings
9,445,093
8,412,913

Other debtors
33,697
14,085

Prepayments and accrued income
187,438
139,786

9,761,325
8,724,345



14.


Cash and cash equivalents

2024
2023
£
£

Cash at bank and in hand
1,022,893
657,924

1,022,893
657,924


Page 26

 
HOSPITALITY & CAPITAL MANAGEMENT LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

15.


Creditors: Amounts falling due within one year

2024
2023
£
£

Trade creditors
106,861
212,509

Corporation tax
209,023
379,744

Other taxation and social security
598,416
258,515

Other creditors
1,846,669
2,057,477

Accruals and deferred income
332,305
681,234

3,093,274
3,589,479


At the year end HSBC holds a partially satisfied charge containing a fixed charge, floating charge covering all the property or undertaking of the company and a negative pledge.


16.


Pension commitments

The Company operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the Company in an independently administered fund. Contributions totalling £4,876 (2023: £5,547) were payable to the fund at the balance sheet date.


17.


Commitments under operating leases

At 31 March 2024 the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:

2024
2023
£
£


Not later than 1 year
1,108,333
1,920,000

Later than 1 year and not later than 5 years
-
1,120,000

1,108,333
3,040,000


18.Guarantees and commitments

The Company had an unconditional guarantee of $Nil (2023: $50,000).

Page 27

 
HOSPITALITY & CAPITAL MANAGEMENT LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

19.


Related party transactions

Transactions and balances with related parties under common control are as follows:


2024
2023
£
£

Balances due to other related parties
662,924
1,268,673
Purchases from other related parties
1,210,081
1,764,433

During the year, as part of a debt finance restructure within the Group, the Company disposed of it's Burton Hotel to an associated sister Company at NBV, see discontinued operations on the Profit and Loss Account.
The Company has taken advantage of the exemption available under FRS102 33.1A not to disclose transactions with wholly owned subsidiaries of the group. 
 

20.


Post balance sheet events

As noted in note 2.2 it is the Director's intention to transfer the trade, assets and liabilities to an associated
sister company, with the exceptions of those liabilities described in note 2.2.


21.


Controlling party

The Company is a wholly owned subsidiary undertaking of First Inn Venture Limited, a company incorporated in the British Virgin Islands. The registered office and principal place of business of First Inn Venture Limited is Nerine Chambers, Quastisky Building, Road Town, Tortola, British Virgin Islands.
The ultimate parent company is Mariada Holdings Limited, a company incorporated in the British Virgin Islands. The registered office and principal place of business of Mariada Holdings Limited is 7 Rue du Rhone, Geneva, Switzerland.
 
Page 28