Registered number:
FOR THE YEAR ENDED 31 DECEMBER 2023
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PURPLE PUBLIC RELATIONS LIMITED
CONTENTS
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PURPLE PUBLIC RELATIONS LIMITED
COMPANY INFORMATION
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PURPLE PUBLIC RELATIONS LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
The directors present their strategic report for the company for the year ended 31 December 2023.
In February 2021, Together Group Holdings PLC through its subsidiary, Together Group Studios Limited, entered into an agreement to purchase the share capital of London-based Purple Public Relations Limited and its subsidiaries in the US (with offices in New York, Miami, Los Angeles) and Hong Kong. Purple results are now consolidated within the Together Group Holdings PLC accounts and therefore the consolidation of the Purple Group of companies is no longer required. This annual report presents the results of the UK-based entity unlike the years prior to 2021 which showed consolidated results including US, UK and Hong Kong based entities. In October 2022, Purple Public Relations Limited transferred 100% of its share capital in Purple USA, Inc. to TG Studios US, LLC, a fellow Together Group entity, for consideration of $11.5m.
The company’s principal trade is public relations and associated services, such as events management services.
Performance and Position We aim to present a balanced and comprehensive review of the development and performance of our business during the year and its position at the year end. Our review is consistent with the size and non-complex nature of our business and is written in the context of the risks and uncertainties we face. Performance – Management Metrics To review management metrics we have elected to exclude the impact of the unrealised FX loss on the TG Studios US, LLC loan of £501k (2022: £648k). The company had a successive year of strong Turnover growth (17%). The company achieved an increase in operating profit of 3% to £1.203m (2022: £1.173) when excluding the contingent consideration and the unrealised FX loss. The company achieved this despite relocating to a new office and incurring relocation costs and a 3-month period of rent at two properties. Performance – Strategic results The company incurred an increase in its operating profit in the year to £702k (2022: £525k), as a result of including the impact of the unrealised FX loss on the loan to TG Studios US, LLC. The company ended the period with a strong balance sheet position showing net current assets of £12.9m (2022: £11.9m), net assets of £13.2m (2022: £12.1m) and cash balances of £0.7m (2022: £0.9m). The company undertook significant operational enhancements in 2023, relocating to a new, state-of-the-art office space in London that enabled the entire UK Team to operate seamlessly on a single floor. This transition facilitated greater collaboration and efficiency across departments. Additionally, the company successfully finalised migrating its entire IT infrastructure to the cloud, enhancing system resilience, scalability, and supporting the continued focus on digital innovation and security. These strategic moves have positioned the company for greater operational flexibility and future growth. Going concern Due to the uncertainty arising from the potential future economic climate, the directors have reviewed the company’s ability to continue as a going concern taking into account the potential impact on the company's future cash flows.
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PURPLE PUBLIC RELATIONS LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
Business review (continued)
The directors have stress tested the cash flows to December 2025 as part of its going concern analyses over Together Group Holdings PLC. Based on the results of the testing, the directors believe the company has sufficient resources to continue as a going concern for the foreseeable future and as such consider the going concern basis for the preparation of the financial statements to be appropriate.
We consider that our key performance indicators are those which communicate the financial performance and strengths of the company as a whole, these being turnover £9.6m (2022: £8.1m) and gross margin.
The business operates in a market where there can be a certain amount of uncertainty in respect of outside influences and public perceptions and trends. With these risks and uncertainties in mind, we are aware that any plans for the future development of the business may be subject to unforeseen events outside of our control. The company regularly reviews the business risks and uses its best efforts to mitigate these through its systems, governance processes and through the definition of appropriate actions.
In particular, the directors have identified the following key risks: Macroeconomic and geo-political risk With its current focus on agencies operating mainly in the UK and in the US, the business is inherently dependent on the (macro)-economic climate in these markets. To mitigate the regional risk, the company is planning to drive a carefully-controlled further regional diversification over time into Europe, Middle East and into Asia-Pacific markets. As such, in 2023 the group opened its Singapore office, to build the Asia-Pacific profile. In addition, current geopolitical events with global impact such as the war in the Ukraine with its direct and indirect consequences also affect our targeted markets and therefore the performance, outlook and risk for our businesses. Pandemic risk (incl Covid 19 and following) Regional, international or even global health crises such as Covid 19 and followings remain a significant risk for our businesses - both in terms of increasing internal risk exposure for our staff as well as affecting client spendings and client project timelines. Depending on the regional situations and regulatory policies, the situations in markets can change very quickly, introducing a further uncertainty into the quality of our cash-flow forecasts. To mitigate such risk, the company is carefully implementing all applicable regulatory requirements and taking specific actions to protect its staff, and it is monitoring the situation in its target markets. Whenever necessary, we work with the businesses to quickly adapt to changing market conditions by focusing on more resilient clients or by adapting the service portfolio and business models. Past crises have shown that the luxury and high-end sectors that the company is targeting on the client side tend to show significantly higher resilience and faster recovery compared to other industries. We would therefore expect the company‘s business to be less affected compared to other service providers that do not have the same client focus. Reputational risk (with direct or indirect financial impact) As the company has a particular focus on clients in the fashion, beauty, luxury, lifestyle, high-end hospitality and property sectors where reputation is of the essence, reputational risk needs to be consciously managed. The rise of social media and the resulting acceleration of the sharing of information, news and of individual opinions and experiences has substantially enhanced this reputational risk. While this constitutes an opportunity for the company for providing additional services on the client side, it also constitutes a key risk for the company itself.
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PURPLE PUBLIC RELATIONS LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
Principal risks and uncertainties (continued)
Risk exposure is naturally higher when serving international markets that are governed by their cultural values, norms, expectations and policies. This not only but particularly applies to Greater China, which constitutes one of the most important but equally complex regions in the world. To mitigate the above risk, the group has already acquired a specialist agency with in-depth cultural and business expertise in the Greater China markets. In addition, we plan the acquisition of a crisis communication specialist, both to serve the group‘s internal needs as well as to extend the existing scope of service for our clients. Operational Credit and cash-flow / liquidity risk The company is exposed to the typical risk of non-recovery of its debts. Appropriate credit-control policies have been implemented with regular reviews of aged debts, closely liaising with the relevant business managers and the clients. Liquidity risk is managed by regularly reviewing cash-flow forecasts and ensuring the availability of sufficient funds as they fall due. At the year-end, the company had £0.9m of cash available. The company’s long-term forecast, cash reserves and existing commitments support the view that the company will have adequate resources to meet its debts as they fall due for the foreseeable future, and for at least 12 months from the signing of these financial statements. Client-related risk The company is exposed to the typical client-risk of service businesses. The key risks that our businesses are facing on the client side are risks resulting from external or internal situations that affect the client’s situation or client satisfaction with the quality of service provided. Examples for the former can be changing regulatory requirements like new policies or lockdown during Covid affecting the planned openings of new physical locations or changes in the strategic priorities or at the leadership level on the client-side, which can affect project calendars with the resulting impact on cash-flow forecasts. Due to the global macroeconomic and geopolitical situation, this risk level has increased in the recent past, and we expect it to remain at a higher level in the mid-term. By working across multiple sectors the company is able to reduce the impact of global pandemic risk. Whereas Clients operating in the Hospitality and Events Management sectors were significantly impacted during Covid, this was less so within the Beauty and Fashion sectors. Additionally the company has no one Client that generates more than 10% of the company income, reducing its risk exposure. To minimise the risk of client dissatisfaction and enhance retention, our businesses entertain a close relationship with their clients, and again, the agreement of longer project contracts with clearly agreed milestones or retainers models help to further reduce the risk. It should be noted, however, that project businesses typically have an inherent lifecycle after which the project terminates and the project-related client-relationship comes to an end. Staff-related legal and compliance risk People are at the heart of our business, and as a result, the business faces both internal risk resulting from non-compliant behaviours or conflicts internally as well as externally - on client-facing service interactions such as meetings and events, or from staff communication and exchanges on public social-media channels. To mitigate that risk, regulatory compliance as well as expected behavioural norms are detailed and clearly communicated to staff and are included in the respective employee handbooks that are made available to all staff. To further mitigate the risk and equally contribute to a positive, collaborative, diverse and inclusive culture, the company plans to further invest into adequate training and other measures, closely collaborating with the agencies’ people and HR representatives.
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PURPLE PUBLIC RELATIONS LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
Principal risks and uncertainties (continued)
Key people risk As the company is a founder-led business, there is an inherently higher dependence on the founders and a key people risk. The directors are mitigating that risk in collaboration with the respective founders, planning for further risk diversification by restructuring roles and responsibilities, internal leadership development or by recruiting appropriate senior-level talent or, where appropriate, engaging in a timely succession planning. Exchange-rate fluctuations With the UK and the USA as its primary markets, the company is exposed to exchange-rate fluctuations between the US$ and the GB£ which has caused significant market volatility in recent months and days. The Purple agencies strongly rely on regional offices delivering services close to the client, thereby inherently minimising risk for project and client-service profitability. With further growth, the company will monitor the remaining risk resulting from international business that involves a variety of international offices, and decide whether and when additional hedging might be necessary. IP-related, data-breach risk and cyber attacks The increasing importance of digitally-supported work as well as the growing role of remote working contributes to an enhanced risk of technical intrusion or data-related issues. The current geo-political climate has further increased the risk of cyberattacks. Wherever possible, the company relies on state-of-the-art cloud-based solutions and is working on clear delegations of authority and policies to further mitigate the risk from socially-engineered fraud attempts and attacks. In addition, the agencies are facing IP-related risks arising from their limited global trademark protection capabilities, which the company will be mitigating in the future.
Having considered its results and risk mitigation strategy, the directors are of the view that the company is well positioned in the current economic climate to continue working towards achieving the company’s growth targets.
This report was approved by the Purple Public Relations Limited board and signed on its behalf.
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PURPLE PUBLIC RELATIONS LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
The directors present their report and the financial statements for the year ended 31 December 2023.
The profit for the year, after taxation, amounted to £993,347 (2022 - £10,781,120).
The directors did not declare a dividend during the year.
The directors who served during the year were:
Matters covered in the Strategic Report As permitted by s414c(11) of the Companies Act 2006, the directors have elected to disclose information, required to be in the directors' report by Schedule 7 of the 'Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008', in the strategic report.
This report was approved by the board and signed on its behalf.
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PURPLE PUBLIC RELATIONS LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2023
The directors are responsible for preparing the strategic report, the directors' report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 101 ‘Reduced Disclosure Framework’. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period.
In preparing these financial statements, the directors are required to:
∙select suitable accounting policies and then apply them consistently;
∙make judgements and accounting estimates that are reasonable and prudent;
∙state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;
∙prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and to enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
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PURPLE PUBLIC RELATIONS LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF PURPLE PUBLIC RELATIONS LIMITED
FOR THE YEAR ENDED 31 DECEMBER 2023
We have audited the financial statements of Purple Public Relations Limited (the 'company') for the year ended 31 December 2023, which comprise the profit and loss account, the balance sheet, the statement of changes in equity and the related notes, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 101 ‘Reduced Disclosure Framework’ (United Kingdom Generally Accepted Accounting Practice).
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the 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.
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
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PURPLE PUBLIC RELATIONS LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF PURPLE PUBLIC RELATIONS LIMITED (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
In our opinion, based on the work undertaken in the course of the audit:
∙the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
∙the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.
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PURPLE PUBLIC RELATIONS LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF PURPLE PUBLIC RELATIONS LIMITED (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
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:
∙the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;
∙we identified the laws and regulations applicable to the company through discussions with directors and other management, and from our commercial knowledge and experience of the company's sector;
∙we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the company, including the Companies Act 2006, taxation legislation and employment legislation;
∙we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and
∙identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit.
We assessed the susceptibility of the company’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:
∙making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; and
∙considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations.
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 a sample of journal entries to identify unusual transactions;
∙assessed whether judgements and assumptions made in determining the accounting estimates set out in
note 3 were indicative of potential bias; and
∙investigated the rationale behind significant or unusual transactions.
In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:
∙agreeing financial statement disclosures to underlying supporting documentation;
∙reading the minutes of meetings of those charged with governance;
∙enquiring of management as to actual and potential litigation and claims.
There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.
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PURPLE PUBLIC RELATIONS LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF PURPLE PUBLIC RELATIONS LIMITED (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
Auditor's responsibilities for the audit of the financial statements (continued) 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 auditor's report.
This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members, as a body, for our audit work, for this report, or for the opinions we have formed.
for and on behalf of
Chartered Accountants
Statutory Auditor
16 Great Queen Street
Covent Garden
WC2B 5AH
Date:
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PURPLE PUBLIC RELATIONS LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2023
The operating profit shown above includes unrealised foreign exchange losses on an intercompany receivable owed by TG Studios US, LLC. The below reconciliation demonstrates the operating results excluding this figure: The profit and loss account has been prepared on the basis that all activities are continuing operations. There are no items of other comprehensive income for either the year or the prior year other than the profit for the year. Accordingly, no statement of other comprehensive income has been presented.
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PURPLE PUBLIC RELATIONS LIMITED
BALANCE SHEET
AS AT 31 DECEMBER 2023
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PURPLE PUBLIC RELATIONS LIMITED
BALANCE SHEET (CONTINUED)
AS AT 31 DECEMBER 2023
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 16 to 36 form part of these financial statements.
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