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Registered number: 11424845
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ABERCORN PROPERTY LIMITED
FINANCIAL STATEMENTS
INFORMATION FOR FILING WITH THE REGISTRAR
FOR THE YEAR ENDED 30 JUNE 2023
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ABERCORN PROPERTY LIMITED
REGISTERED NUMBER:11424845
STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2023
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Debtors: amounts falling due within one year
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Creditors: amounts falling due within one year
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TOTAL ASSETS LESS CURRENT LIABILITIES
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Creditors: amounts falling due after more than one year
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The financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime and in accordance with the provisions of FRS 102 Section 1A - small entities.
The financial statements have been delivered in accordance with the provisions applicable to companies subject to the small companies regime.
The company has opted not to file the statement of income and retained earnings in accordance with provisions applicable to companies subject to the small companies' regime.
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on form part of these financial statements.
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ABERCORN PROPERTY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
Abercorn Property Limited is a limited liability company incorporated in England. The registered office is
10 Temple Back, Bristol, BS1 6FL.
2.ACCOUNTING POLICIES
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BASIS OF PREPARATION OF FINANCIAL STATEMENTS
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The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Section 1A of Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
The following principal accounting policies have been applied:
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FINANCIAL REPORTING STANDARD 102 - REDUCED DISCLOSURE EXEMPTIONS
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The company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by the FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":
∙the requirements of Section 7 Statement of Cash Flows;
∙the requirements of Section 3 Financial Statement Presentation paragraph 3.17(d);
∙the requirements of Section 11 Financial Instruments paragraphs 11.42, 11.44 to 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b) and 11.48(c);
∙the requirements of Section 12 Other Financial Instruments paragraphs 12.26 to 12.27, 12.29(a), 12.29(b) and 12.29A;
∙the requirements of Section 33 Related Party Disclosures paragraph 33.7.
This information is included in the consolidated financial statements of Fairlie Holdings Limited as at 30 June 2023 and these financial statements may be obtained from Companies House.
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ABERCORN PROPERTY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
2.ACCOUNTING POLICIES (continued)
The company has made a loss of £86,031 (2022: £230,978) and has a deficit in shareholder’s funds of £420,997 (2022: £334,966). The company owns freehold property which is awaiting development and is supported by a bank loan. Development of the property has been delayed subject to the completion of other capital projects in the group with no expected change in status within 12 months of the approval of the financial statements.
The Company is a part of the Fairlie Holdings Limited group (“the Group”) and the Group has two distinct and separate funding groups, one of which has borrowings from Barclays (“the Barclays borrowing group”) and the other which has borrowings from Triodos (“the Triodos borrowing group”). As disclosed in Notes 10 & 12, the company is part of the Triodos borrowing group and cross guarantees exist amongst the members of the Triodos borrowing group on facilities totalling £17,841,546.
The main cashflow for the company to service its debt and maintain the property comes from cash flows generated by fellow group companies. The company therefore ultimately continues to rely on funding provided by its parent, Fairlie Holdings Limited and fellow subsidiaries.
The trading performance of 92 Higher Drive Limited and Higher Drive Nursing Homes (Holdings) Limited (fellow subsidiaries and members of the Triodos borrowing group) are also the source of relevant financial covenant metrics attaching to the bank loan described in note 10 included within the Company. The Company is therefore reliant on the performance of these fellow subsidiaries to ensure its own compliance with banking covenants on secured debts.
At the balance sheet date the Triodos borrowing group funding facilities’ financial covenants were not being met. Furthermore, the component of the Triodos facility attaching to the company was due for repayment in 2024, this repayment was not made, and the facility has been extended to 31 December 2024. No formal waiver of enforcement action as a result of the covenant breach has been obtained by the directors and the facilities are therefore in default and treated as repayable on demand at the Balance Sheet date. Triodos has also instructed an independent review of likely future trading performance of companies in the Triodos borrowing group. This review has not yet been concluded.
The directors are in discussions with Triodos regarding this breach and ongoing review, and are seeking confirmation that existing facilities will continue to be made available. Whilst continuing in a positive way, and the outcome of ongoing discussions is expected to be positive, the conclusion remains uncertain.
Notwithstanding the above breach, based on financial performance to date and forecasts, the directors are satisfied that the Company and other companies in the Triodos borrowing group have sufficient resources to meet the covenant, debt finance service and working capital requirements of these debt facilities going forward.
Certain other companies within the Triodos borrowing group have also received funding from companies within the Barclays borrowing group. Companies within the Triodos borrowing group are dependent upon the continued availability of these balances, which is in turn dependent upon the companies within the Barclays borrowing group continuing as going concerns. The directors expect this to be the case.
The directors confirm that the amounts owed to group undertakings of £1,328,874 (2022: £1,185,249) will not be sought for repayment for at least 12 months from the approval of the financial statements. However, should repayment of these balances be sought, the company would need to seek additional sources of funding. The availability of such funding is uncertain.
The directors consider that the group is able to provide the support required for the company to continue to operate for a period of at least 12 months from the approval of the accounts and therefore it is appropriate to prepare the accounts on a going concern basis.
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ABERCORN PROPERTY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
2.ACCOUNTING POLICIES (continued)
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GOING CONCERN (CONTINUED)
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If the Company or Group were unable to obtain adequate funding, it would not be able to continue trading and adjustments would have to be made to reduce the assets to their realisable amount and to provide for any further liabilities.
Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.
All borrowing costs are recognised in profit or loss in the year in which they are incurred.
Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.
The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the company operates and generates income.
Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the reporting date, except that:
∙The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and
∙Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.
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 reporting date.
No consideration has been paid in respect of group relief utilised throughout the group in the current or prior year.
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.
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ABERCORN PROPERTY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
2.ACCOUNTING POLICIES (continued)
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TANGIBLE FIXED ASSETS (CONTINUED)
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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:
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From the date such assets are brought into use
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The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.
Investments in subsidiaries are measured at cost less accumulated impairment.
Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.
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.
The company has elected to apply the provisions of Section 11 “Basic Financial Instruments” of FRS 102 to all of its financial instruments.
Basic financial assets
Basic financial assets, which include trade and other receivables, cash and bank balances, are initially measured at their transaction price including transaction costs and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest.
Discounting is omitted where the effect of discounting is immaterial. The company's cash and cash equivalents, trade and most other receivables due with the operating cycle fall into this category of financial instruments.
Financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instruments any contract that evidences a residual interest in the assets of the company after the deduction of all its liabilities.
Basic financial liabilities, which include trade and other payables, bank loans and other loans are
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ABERCORN PROPERTY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
2.ACCOUNTING POLICIES (continued)
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FINANCIAL INSTRUMENTS (CONTINUED)
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initially measured at their transaction price after transaction costs. When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest. Discounting is omitted where the effect of discounting is immaterial.
Debt instruments are subsequently carried at their amortised cost using the effective interest rate method.
Trade payables are obligations to pay for goods and services that have been acquired in the ordinary course of business from suppliers. Trade payables are classified as current liabilities if the payment is due within one year. If not, they represent non-current liabilities. Trade payables are initially recognised at their transaction price and subsequently are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial.
Derecognition of financial assets
Financial assets are derecognised when their contractual right to future cash flow expire, or are settled, or when the company transfers the asset and substantially all the risks and rewards of ownership to another party. If significant risks and rewards of ownership are retained after the transfer to another party, then the company will continue to recognise the value of the portion of the risks and rewards retained.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company's contractual obligations expire or are discharged or cancelled.
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JUDGMENTS IN APPLYING ACCOUNTING POLICIES AND KEY SOURCES OF ESTIMATION UNCERTAINTY
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Preparation of the financial statements requires management to make significant judgements and estimates, where required.
Freehold property held pending development into a specialist care home is held at a cost a £2,208,431. In considering any indicators of impairment the directors assess the anticipated development project and whether this is expected to maintain the net realisable value of the property. In making their assessment in the current year the directors are of the opinion that this will be the case. Such redevelopment is also dependent upon the availability of suitable banking facilities and note 2.3 sets out the uncertainty in this respect. It may be necessary to write down the carrying value of the property to the value achievable if it were sold in its current state without further development, which could be materially lower than its current carrying value.
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The average monthly number of employees, including directors, during the year was 2 (2022: 2).
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ABERCORN PROPERTY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
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Investments in subsidiary companies
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ABERCORN PROPERTY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
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Prepayments and accrued income
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CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
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Amounts owed to group undertakings
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Amounts owed to group undertakings are unsecured, repayable on demand and bear no interest.
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CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR
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For details of loan security and other terms, see Loans note 10 below.
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ABERCORN PROPERTY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
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Analysis of the maturity of loans is given below:
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AMOUNTS FALLING DUE WITHIN ONE YEAR
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AMOUNTS FALLING DUE 1-2 YEARS
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AMOUNTS FALLING DUE 2-5 YEARS
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Bank loans of £1,328,478 are secured by a fixed charge over the assets of the company, Woodstown House Property Limited, Higher Drive Nursing Home (Holdings) Limited and by a cross guarantee with 92 Higher Drive Limited, Woodstown Healthcare Limited and Abercorn House Healthcare Limited in favour of Triodos Bank. The loan bears a minimum interest of 2.75% or 2.25% over the Bank of England base rate (subject to a minimum total rate). The loan is repayable by instalments for 5 years on a 20 year nominal amortisation period due for repayment in June 2024. As described in note 2.3, the scheduled repayment was not made.
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ABERCORN PROPERTY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
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ALLOTTED, CALLED UP AND FULLY PAID
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1 (2022: 1) Ordinary share of £1.00
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The company is subject to a fixed charge over its assets in favour of Triodos Bank plc with Woodstown House Property Limited, Higher Drive Nursing Home (Holdings) Limited and by a cross guarantee with 92 Higher Drive Limited, Woodstown Healthcare Limited and Abercorn House Healthcare Limited fellow group companies, on loans totalling £17,841,546 (2022: £17,072,876).
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RELATED PARTY TRANSACTIONS
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The company has taken advantage of the exemption in Financial Reporting Standard 102 Section 33 from the requirement to disclose transactions with group companies.
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The immediate and ultimate parent undertaking is Fairlie Holdings Limited, a company incorporated in the UK. The consolidated accounts are available from Companies House and the registered office of Fairlie Holdings Limited.
The ultimate controlling party is J Whelan by virtue of his majority shareholding in Fairlie Holdings Limited.
The auditors' report on the financial statements for the year ended 30 June 2023 was unqualified.
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In their report, the auditors emphasised the following matter without qualifying their report:
We draw attention to Note 2.3 in the financial statements, which indicates that the company was in breach of financial covenants attaching to its bank facilities, along with those of fellow subsidiaries to which the company is subject to a cross guarantee at 30 June 2023. Whilst the directors are confident of a successful outcome to ongoing negotiations with the bank, no formal waiver of enforcement action as a result of this breach has been obtained by the directors.
As stated in Note 2.3, these events or conditions, along with other matters as set forth in Note 2.3, indicate that a material uncertainty exists that may cast significant doubt on the company’s ability to continue as a going concern. Our opinion is not modified in respect of this matter.
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The audit report was signed on 30 October 2024 by Andrew Sandiford BCom FCA (Senior statutory auditor) on behalf of Bishop Fleming Bath Limited.
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