Company registration number 03912906 (England and Wales)
ALERT COMMUNICATIONS LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
ALERT COMMUNICATIONS LIMITED
COMPANY INFORMATION
Directors
Matthew Taylor
Mark Knight
John Cavill
Matthew Bealey
Secretary
Nicholas Borrett
Company number
03912906
Registered office
33 Wigmore Street
London
UK
W1U 1QX
Independent Auditors
PricewaterhouseCoopers LLP
Chartered Accountants & Statutory Auditors
Atria One
144 Morrison Street
Edinburgh
EH3 8EX
Bankers
Barclays Bank Plc
City Office
71 Lombard Street
London
EC3P 3BS
ALERT COMMUNICATIONS LIMITED
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3
Directors' responsibilities statement
4
Independent auditors' report
5 - 8
Statement of comprehensive income
9
Statement of financial position
10
Statement of changes in equity
11
Notes to the financial statements
12 - 24
ALERT COMMUNICATIONS LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2024
- 1 -

The directors present their strategic report on Alert Communications Limited ("the Company") for the year ended 31 March 2024.

Principal objectives and strategies

The principal activity of the company continued to be to finance, operate and maintain a Received Signal Service Communications Link as a Private Finance Initiative (PFI) project with the Ministry of Defence.

 

The contact is in year 20 of its term expiring in 2033.

Review of the business

As the Company is in the full operational phase it faces operational risks and actively monitors financial performance against loan covenants. During the year the Company was fully compliant with the contractual terms and incurred no penalty points. From a financial perspective the company has been performing well and has been compliant with the covenants laid out in the loan agreement. The Company is also forecasting compliance with the covenants laid out in the loan agreement.

 

The directors expect the performance of the Company to be in line with the forecasting model and remain profitable in future years.

Principal risks and uncertainties

Due to the nature of the Company's business, the financial risks the directors consider relevant to this Company are credit, interest rate, cash flow and liquidity risk. The credit and cash flow risks are not considered to be significant as the client is a quasi governmental organisation. The significant risks are considered to be:

 

Interest Rate Risk

The financial risk management objectives of the Company are to ensure that financial risks are mitigated by the use of financial instruments where they cannot be addressed by contractual provisions. The Company uses interest rate swaps to reduce its exposure to interest rate movements. Financial instruments are not used for speculative purposes.

 

Liquidity Risk

The Company's liquidity risk is principally managed through financing the Company by means of long-term borrowings.

Future Developments

The directors intend for the business to continue to operate in line with the contractual terms and do not expect any strategic changes.

Key performance indicators

The performance of the Company from a cash perspective is assessed on a six monthly basis by the testing of the covenants of the senior debt provider, the key indicator being the debt service cover ratio. The Company has been performing well and has been compliant with the covenants laid out in the loan agreement.

Going Concern

These financial statements have been prepared on the going concern basis for the reasons set out in the Accounting Policies.

Climate Change

The directors recognise that it is important to disclose their view of the impact of climate change on the company. As a holding company, the company itself does not trade. The company's indirect subsidiaries key operational contracts are long-term and with a small number of known counterparties. In most cases, the cashflows from these contracts can be predicted with reasonable certainty for at least the medium-term. Having considered the operations, their contracted rights and obligations and forecast cash flows, there is not expected to be a significant impact upon the operational or financial performance arising from climate change.

ALERT COMMUNICATIONS LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 2 -

This report was approved by the board of directors on 25 September 2024 and signed by order of the board by:

Mark Knight
Director
25 September 2024
ALERT COMMUNICATIONS LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2024
- 3 -

The directors present their annual report and the financial statements of Alert Communications Limited ("the Company") for the year ended 31 March 2024.

Results and dividends

The results for the year are set out on page 9.

 

The profit for the financial year, after taxation, amounted to £958,498 (2023: profit of £1,121,091).

 

The directors are satisfied with the overall performance of the Company and do not foresee any significant change in the Company's activities in the coming financial year.

Ordinary dividends were paid amounting to £nil (2023: £nil). The directors do not recommend payment of a final dividend.

Directors

The directors who held office during the year and up to the date of approval of the financial statements were as follows:

Matthew Taylor
Mark Knight
John Cavill
Matthew Bealey
(Appointed 3 August 2023)
James Edenborough
(Resigned 3 August 2023)
Qualifying third party indemnity provisions

The company has made qualifying third party indemnity provisions for the benefit of its directors during the year. These provisions remain in force at the reporting date.

Auditors

The auditors, PricewaterhouseCoopers LLP, are deemed to be reappointed under section 487(2) of the Companies Act 2006.

Strategic report

The company has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the company's strategic report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the directors' report. It has done so in respect of Principal Objectives, Financial Instruments and Future Developments.

Statement of disclosure to auditors

In the case of each director in office at the date the Directors' Report is approved:

 

•    so far as the director is aware, there is no relevant audit information of which the Company's auditors are unaware; and

•    they have taken all the steps that they ought to have taken as a director in order to make themselves aware of any relevant audit information and to establish that the Company's auditors are aware of that information.

This report was approved by the board of directors on 25 September 2024 and signed by order of the board by:
Mark Knight
Director
25 September 2024
ALERT COMMUNICATIONS LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 MARCH 2024
- 4 -

The directors are responsible for preparing the annual 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 prepared the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards, comprising FRS102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland", and applicable law).

 

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 the financial statements, the directors are required to:

 

 

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.

 

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 enable them to ensure that the financial statements comply with the Companies Act 2006.

 

 

The financial statements were approved and signed by the director and authorised for issue on 25 September 2024

 

 

 

 

Mark Knight

Director                        

 

ALERT COMMUNICATIONS LIMITED
INDEPENDENT AUDITORS' REPORT
TO THE MEMBER OF ALERT COMMUNICATIONS LIMITED
FOR THE YEAR ENDED 31 MARCH 2024
- 5 -
Report on the audit of the financial statements
Opinion

In our opinion, Alert Communications Limited's financial statements:

 

 

 

 

We have audited the financial statements, included within the Annual Report and Financial Statements (the "Annual Report"), which comprise: the Statement of financial position as at 31 March 2024; the Statement of comprehensive income and the Statement of changes in equity for the year then ended; and the notes to the financial statements, which include a description of the significant accounting policies.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) ("ISAs (UK)") and applicable law. Our responsibilities under ISAs (UK) are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

 

Independence

We remained independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, which includes the FRC's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements.

Conclusions relating to going concern

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.

 

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.

 

However, because not all future events or conditions can be predicted, this conclusion is not a guarantee as to the company's ability to continue as a going concern.

 

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

ALERT COMMUNICATIONS LIMITED
INDEPENDENT AUDITORS' REPORT (CONTINUED)
TO THE MEMBER OF ALERT COMMUNICATIONS LIMITED
FOR THE YEAR ENDED 31 MARCH 2024
- 6 -

Reporting on other information

The other information comprises all of the information in the Annual Report other than the financial statements and our auditors' report thereon. The directors are responsible for the other information. Our opinion on the financial statements does not cover the other information and, accordingly, we do not express an audit opinion or, except to the extent otherwise explicitly stated in this report, any form of assurance thereon.

In connection with our audit of the financial statements, 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 audit, or otherwise appears to be materially misstated. If we identify an apparent material inconsistency or material misstatement, we are required to perform procedures to conclude whether there is a material misstatement of the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report based on these responsibilities.

With respect to the Strategic report and Directors' report, we also considered whether the disclosures required by the UK Companies Act 2006 have been included.

Based on our work undertaken in the course of the audit, the Companies Act 2006 requires us also to report certain opinions and matters as described below.

Strategic report and Directors' report

In our opinion, based on the work undertaken in the course of the audit, the information given in the Strategic report and Directors' report for the year ended 31 March 2024 is consistent with the financial statements and has been prepared in accordance with applicable legal requirements.

 

In light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we did not identify any material misstatements in the Strategic report and Directors' report.

Responsibilities for the financial statements and the audit
Responsibilities of the directors for the financial statements

As explained more fully in the Directors' responsibilities statement, the directors are responsible for the preparation of the financial statements in accordance with the applicable framework and for being satisfied that they give a true and fair view. The directors are also responsible for such internal control as they determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

 

In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Auditors' responsibilities for the audit of the financial statements

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

ALERT COMMUNICATIONS LIMITED
INDEPENDENT AUDITORS' REPORT (CONTINUED)
TO THE MEMBER OF ALERT COMMUNICATIONS LIMITED
FOR THE YEAR ENDED 31 MARCH 2024
- 7 -

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.

 

Based on our understanding of the company and industry, we identified that the principal risks of non­-compliance with laws and regulations related to Companies Act 2006 and UK tax legislation, and we considered the extent to which non-compliance might have a material effect on the financial statements. We evaluated management's incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls), and determined that the principal risks were related to inappropriate journal entries and the risk of management bias in accounting estimates. Audit procedures performed by the engagement team included:

 

 

 

 

 

There are inherent limitations in the audit procedures described above. We are less likely to become aware of instances of non-compliance with laws and regulations that are not closely related to events and transactions reflected in the financial statements. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion.

A further description of our responsibilities for the audit of the financial statements is located on the FRC's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditors' report.

Use of this report

This report, including the opinions, has been prepared for and only for the company's members as a body in accordance with Chapter 3 of Part 16 of the Companies Act 2006 and for no other purpose. We do not, in giving these opinions, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior consent in writing.

 

Other required reporting

 

Companies Act 2006 exception reporting

Under the Companies Act 2006 we are required to report to you if, in our opinion:

 

 

 

 

 

We have no exceptions to report arising from this responsibility.

ALERT COMMUNICATIONS LIMITED
INDEPENDENT AUDITORS' REPORT (CONTINUED)
TO THE MEMBER OF ALERT COMMUNICATIONS LIMITED
FOR THE YEAR ENDED 31 MARCH 2024
- 8 -
Paul Cheshire (Senior Statutory Auditor)
for and on behalf of PricewaterhouseCoopers LLP
Chartered Accountants and Statutory Auditors
Edinburgh
25 September 2024
ALERT COMMUNICATIONS LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2024
- 9 -
2024
2023
as restated
Notes
£
£
Turnover
3
10,735,493
11,934,537
Cost of sales
(5,519,505)
(5,898,988)
Gross profit
5,215,988
6,035,549
Administrative expenses
(2,624,157)
(2,579,760)
Operating profit
4
2,591,831
3,455,789
Interest receivable and similar income
7
581,393
516,855
Interest payable and similar expenses
8
(2,071,390)
(2,366,871)
Profit before taxation
1,101,834
1,605,773
Tax on profit
9
(143,336)
(484,682)
Profit for the financial year
958,498
1,121,091
Other comprehensive income
Fair value gain on cash flow hedging instruments, net of tax
329,552
1,993,574
Total comprehensive income for the year
1,288,050
3,114,665

All of the activities of the company are from continuing operations.

 

In the prior year, interest receivable was understated by £240,720 and therefore a prior year restatement has been made to reflect this (see note 21).

The notes on pages 12 to 24 form part of these financial statements.

ALERT COMMUNICATIONS LIMITED
STATEMENT OF FINANCIAL POSITION
AS AT
31 MARCH 2024
31 March 2024
- 10 -
2024
2023
as restated
Notes
£
£
£
£
Fixed assets
Tangible assets
10
13,207,733
15,170,817
Investments
11
4,693,137
4,693,137
17,900,870
19,863,954
Current assets
Debtors: amounts falling due within one year
13
6,056,275
5,788,786
Debtors: amounts falling due after one year
13
1,382,698
3,387,801
Cash at bank and in hand
937,398
2,235,851
8,376,371
11,412,438
Creditors: amounts falling due within one year
14
(5,270,890)
(6,113,228)
Net current assets
3,105,481
5,299,210
Total assets less current liabilities
21,006,351
25,163,164
Creditors: amounts falling due after more than one year
15
(21,116,506)
(24,536,087)
Provisions for liabilities
Deferred taxation
16
-
0
(2,025,282)
-
(2,025,282)
Net liabilities
(110,155)
(1,398,205)
Capital and reserves
Called up share capital
17
476,000
476,000
Hedging reserve
(773,574)
(1,103,126)
Profit and loss reserve
18
187,419
(771,079)
Total shareholders' deficit
(110,155)
(1,398,205)

The notes on pages 12 to 24 form part of these financial statements.

The financial statements were approved by the board of directors and authorised for issue on 25 September 2024 and are signed on its behalf by:
Mark Knight
Director
Company registration number 03912906 (England and Wales)
ALERT COMMUNICATIONS LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2024
- 11 -
Called up share capital
Hedging reserve
Profit and loss reserve
Total
£
£
£
£
As restated for the period ended 31 March 2023:
Balance at 1 April 2022
476,000
(3,096,700)
(1,892,170)
(4,512,870)
Year ended 31 March 2023:
Profit for the financial year
-
-
1,121,091
1,121,091
Other comprehensive income:
Fair value movements on cash flow hedging instruments, net of tax
-
1,993,574
-
1,993,574
Total comprehensive income for the year
-
1,993,574
1,121,091
3,114,665
Balance at 31 March 2023
476,000
(1,103,126)
(771,079)
(1,398,205)
Year ended 31 March 2024:
Profit for the financial year
-
-
958,498
958,498
Other comprehensive income:
Fair value movements on cash flow hedging instruments, net of tax
-
329,552
-
329,552
Total comprehensive income for the year
-
329,552
958,498
1,288,050
Balance at 31 March 2024
476,000
(773,574)
187,419
(110,155)
Included in the fair value movement on cash flow hedging instrument is £157,618 (2023: £902,502) that was recycled through Interest Payable in the Statement of Comprehensive Income.

The notes on pages 12 to 24 form part of these financial statements.

ALERT COMMUNICATIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
- 12 -
1
Accounting policies
Company information

Alert Communications Limited ("the Company") is a private company limited by shares incorporated in the United Kingdom and is registered in England and Wales. The registered office is located at 33 Wigmore Street, London, UK, W1U 1QX.

 

The principal activity of the company continued to be to finance, operate and maintain a Received Signal Service Communications Link as a Private Finance Initiative (PFI) project with the Ministry of Defence.

 

The contact is in year 20 of its term expiring in 2033.

1.1
Accounting convention

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention, as modified by the revaluation of certain financial assets and liabilities. The principal accounting policies adopted are set out below and have been consistently applied to the years presented, unless otherwise stated.

This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements:

 

 

The financial statements of the company are consolidated in the financial statements of BIIF Holdco Limited. These consolidated financial statements are available from its registered office, Cannon Place, 78 Cannon Street, London, EC4N 6AF.

1.2
Going concern

The financial statements are prepared on a going concern basis notwithstanding net liabilities of £true110,155 (2023: £1,398,205) which the directors believe to be appropriate for the following reasons.

 

At the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

 

The Company prepares cash flow forecasts covering the expected life of the asset and so including the 12 month period from the date the financial statements are signed. In drawing up these forecasts, the Directors have made assumptions based on their view of the current and future economic conditions that will prevail over the forecast period. Based on these forecast the Directors have a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future. In light of this, the directors continue to adopt the going concern basis of accounting in preparing the Company's annual financial statements.

ALERT COMMUNICATIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
- 13 -
1.3
Turnover

Turnover represents the management services income received by the Company for the provision of a PFI asset to the customer. This income is received over the life of the concession period.

1.4
Tangible assets

Tangible assets are initially recorded at cost, and subsequently stated at cost less any accumulated depreciation and impairment losses. Any tangible assets carried at revalued amounts are recorded at the fair value at the date of revaluation less any subsequent accumulated depreciation and subsequent accumulated impairment losses.

 

An increase in the carrying amount of an asset as a result of a revaluation, is recognised in other comprehensive income and accumulated in equity, except to the extent it reverses a revaluation decrease of the same asset previously recognised in profit or loss. A decrease in the carrying amount of an asset as a result of revaluation, is recognised in other comprehensive income to the extent of any previously recognised revaluation increase accumulated in equity in respect of that asset. Where a revaluation decrease exceeds the accumulated revaluation gains accumulated in equity in respect of that asset, the excess shall be recognised in profit or loss.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Freehold property
Straight line over 27 years
Plant and machinery
Straight line over 27 years
1.5
Fixed asset investments

Investments in associates accounted for in accordance with the cost model are recorded at cost less any accumulated impairment losses.

 

Investments in associates accounted for in accordance with the fair value model are initially recorded at the transaction price. At each reporting date, the investments are measured at fair value, with changes in fair value recognised in other comprehensive income/profit or loss. Where it is impracticable to measure fair value reliably without undue cost or effort, the cost model will be adopted.

 

Dividends and other distributions received from the investment are recognised as income without regard to whether the distributions are from accumulated profits of the associate arising before or after the date of acquisition.

1.6
Impairment of fixed assets

A review for indicators of impairment is carried out at each reporting date, with the recoverable amount being estimated where such indicators exist. Where the carrying value exceeds the recoverable amount, the asset is impaired accordingly. Prior impairments are also reviewed for possible reversal at each reporting date.

 

For the purposes of impairment testing, when it is not possible to estimate the recoverable amount of an individual asset, an estimate is made of the recoverable amount of the cash-generating unit to which the asset belongs. The cash-generating unit is the smallest identifiable group of assets that includes the asset and generates cash inflows that are largely independent of the cash inflows from other assets or groups of assets.

ALERT COMMUNICATIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
- 14 -
1.7
Cash and cash equivalents

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

 

The Company is obligated to keep cash reserves as at the balance sheet date in respect of requirements in the company's funding agreements. This restricted cash balance, which is shown within the "cash at bank and in hand" balance amounts to £380,000 (2023: £1,305,000).

1.8
Financial instruments

The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

 

Financial instruments are recognised in the company's statement of financial position when the company becomes party to the contractual provisions of the instrument.

Basic financial assets

Basic financial assets, which include debtors , cash and bank balances, are initially measured at transaction price including transaction costs and debtors are subsequently carried at amortised cost using the effective interest method 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. Financial assets classified as receivable within one year are not amortised.

Other financial assets

Other financial instruments are subsequently measured at fair value, with any changes recognised in the Statement of Comprehensive Income, with the exception of hedging instruments in a designated hedging relationship.

Impairment of financial assets

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

 

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

 

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

Derecognition of financial assets

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

Classification of financial liabilities

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.

ALERT COMMUNICATIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
- 15 -
Basic financial liabilities

Basic financial liabilities, including Creditors, bank loans, loans from fellow group are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

 

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

 

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Other financial liabilities

Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value at each reporting date. The fair values of the derivatives have been calculated by discounting the fixed cash flows at forecasted forward interest rates over the term of the financial instrument. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.

 

Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

Derecognition of financial liabilities

Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.

1.9
Equity instruments

Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.

1.10
Hedge accounting

The Company has entered into an arrangement with third parties that is designed to hedge future cash flows arising on variable rate interest loan arrangements, with the net effect of exchanging the cash flows arising under those arrangements for a stream of fixed interest cash flows ("interest rate swaps").

 

To qualify for hedge accounting, documentation is prepared specifying the hedging strategy, the component transactions and methodology used for effectiveness measurement. Changes in the carrying value of financial instruments that are designated and effective as hedges of future cash flows ("cash flow hedges") are recognised directly in a hedging reserve in equity and any ineffective portion is recognised immediately in the Statement of Comprehensive Income. Amounts deferred in equity in respect of cash flow hedges are subsequently recognised in the Statement of Comprehensive Income in the same period in which the hedged item affects net profit or loss or the hedging relationship is terminated and the underlying position being hedged has been extinguished.

Changes in the fair value of derivatives that are designated and qualify as fair value hedges are recognised in profit or loss immediately, together with any changes in the fair value of the hedged asset or liability that are attributable to the hedged risk.

ALERT COMMUNICATIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
- 16 -
1.11
Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

Current tax

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the Statment Of Comprehensive Income because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

 

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the Statment Of Comprehensive Income, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

2
Judgements and key sources of estimation uncertainty

In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

 

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

ALERT COMMUNICATIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
2
Judgements and key sources of estimation uncertainty
(Continued)
- 17 -
Key sources of estimation uncertainty

The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows:

Impairment of assets

The carrying value of those assets recorded in the Company's Statement of Financial Position, at amortised cost less any impairment losses, could be materially reduced where circumstances exist which might indicate that an asset has been impaired and an impairment review is performed. Impairment reviews consider the fair value and/or value in use of the potentially impaired asset or assets and compare that with the carrying value of the asset or assets in the Statement of Financial Position. Any reduction in value arising from such a review would be recorded in the Statement of Comprehensive Income. Impairment reviews involve the significant use of assumptions. Consideration has to be given as to the price that could be obtained for the asset or assets, or in relation to a consideration of value in use, estimates of the future cash flows that could be generated by the potentially impaired asset or assets, together with a consideration of an appropriate discount rate to apply to those cash flows.

Fair values of derivative contracts

Fair values for derivative contracts are based on mark-to-market valuations provided by the contract counterparty. Whilst these can be tested for reasonableness, the exact valuation methodology and forecast assumptions for future interest rates or inflation rates are specific to the counterparty.

3
Turnover
2024
2023
£
£
Turnover analysed by class of business
Rendering of Services
10,735,493
11,934,537

The whole of the turnover is attributable to the principal activity of the Company wholly undertaken in the United Kingdom.

4
Operating profit
2024
2023
Operating profit for the year is stated after charging:
£
£
Depreciation of owned tangible fixed assets
1,963,084
1,963,083
5
Auditors' remuneration
2024
2023
Fees payable to the company's auditors and associates:
£
£
For audit services
Audit of the financial statements of the company
19,974
17,280

Included in the fee above is the audit of the other associated companies: Alert Communications (2006) Limited, Alert Communications (Holdings) Limited and Alert Communications Group Holdings Limited. These audit costs have not been recharged to the associated companies.

ALERT COMMUNICATIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 18 -
6
Employees

The average number of persons employed by the Company during the financial year, including the directors, amounted to nil (2023: nil). The directors are not employed by the company and did not receive any remuneration during the year (2023: nil).

7
Interest receivable and similar income
2024
2023
£
£
Interest income
Interest on bank deposits
94,925
52,742
Interest receivable from group companies
486,468
464,113
581,393
516,855

Interest receivable and similar income for the prior year has been restated for matters set out in note 21.

8
Interest payable and similar expenses
2024
2023
£
£
Interest on bank overdrafts and loans
1,467,450
1,666,500
Interest payable to group undertakings
587,254
681,989
Other interest payable and similar expenses
16,686
18,382
2,071,390
2,366,871
9
Taxation on profit
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
273,367
255,351
Adjustments in respect of prior periods
-
0
(36,192)
Total current tax
273,367
219,159
Deferred tax
Origination and reversal of timing differences
(130,031)
82,907
Adjustment in respect of prior periods
-
0
182,616
Total deferred tax
(130,031)
265,523
Total tax charge
143,336
484,682

In 2021 an increase in the corporation tax rate to 25% with effect from 1 April 2023 was substantively enacted.

ALERT COMMUNICATIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
9
Taxation on profit
(Continued)
- 19 -

The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:

2024
2023
£
£
Profit before taxation
1,101,834
1,605,773
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00% (2023: 19.00%)
275,459
305,097
Tax effect of expenses that are not deductible in determining taxable profit
49,558
37,665
Tax effect of income not taxable in determining taxable profit
(121,593)
(88,182)
Adjustments in respect of prior years
-
0
146,424
Effect of change in corporation tax rate
-
0
(128,476)
Deferred tax not recognised
(60,088)
212,154
Taxation charge for the year
143,336
484,682

Tax for 2023 has been restated for the matter set out in note 21.

10
Tangible assets
Freehold property
Plant and machinery
Total
£
£
£
Cost
At 1 April 2023 and 31 March 2024
5,238,594
47,764,663
53,003,257
Depreciation
At 1 April 2023
3,739,181
34,093,259
37,832,440
Depreciation charged in the year
194,022
1,769,062
1,963,084
At 31 March 2024
3,933,203
35,862,321
39,795,524
Carrying amount
At 31 March 2024
1,305,391
11,902,342
13,207,733
At 31 March 2023
1,499,413
13,671,404
15,170,817
11
Fixed asset investments
2024
2023
Notes
£
£
Investments in subsidiaries
12
4,693,137
4,693,137
ALERT COMMUNICATIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
11
Fixed asset investments
(Continued)
- 20 -
Movements in fixed asset investments
Shares in subsidiaries
£
Cost or valuation
At 1 April 2023 & 31 March 2024
4,693,137
Carrying amount
At 31 March 2024
4,693,137
At 31 March 2023
4,693,137
12
Subsidiaries

Details of the company's subsidiaries at 31 March 2024 are as follows:

Name of undertaking
Registered office
Class of
% Held
shares held
Direct
Alert Communications
(2006) Limited
33 Wigmore Street London, W1U 1QX
Ordinary
100.00
The aggregate capital and reserves and the result for the year of the subsidiaries noted above was as follows:
Name of undertaking
Capital and Reserves
Profit/(Loss)
£
£
Alert Communications
(2006) Limited
(1,309,837)
(162,641)

The directors believe that based on a review of forecasts, the future profits support the value of the investments.

13
Debtors
2024
2023
Amounts falling due within one year:
£
£
Trade debtors
78,825
61,857
Corporation tax recoverable
84,056
320,240
Amounts owed by group undertakings
5,893,057
5,406,590
Prepayments and accrued income
337
99
6,056,275
5,788,786
ALERT COMMUNICATIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
13
Debtors
(Continued)
- 21 -
2024
2023
Amounts falling due after more than one year:
£
£
Deferred tax asset (note 16)
1,382,698
3,387,801
Total debtors
7,438,973
9,176,587

Amounts owed by Group undertakings relate to preference share interest due from Alert Communications (2006) Limited.

Debtors for the prior year has been restated for matters set out in note 21.

14
Creditors: amounts falling due within one year
2024
2023
Notes
£
£
Bank loans
2,979,434
2,551,807
Trade creditors
424,803
548,065
Amounts owed to group undertakings
1,025,612
2,185,385
Taxation and social security
213,953
230,841
Accruals and deferred income
627,088
597,130
5,270,890
6,113,228

Amounts owed to Group undertakings relates to accrued interest due on subordinated debt of £1,025,612 (2023: £2,185,385). Further information on the subordinated loan is detailed in the following note.

15
Creditors: amounts falling due after more than one year
2024
2023
Notes
£
£
Bank loans
17,191,368
20,171,546
Amounts owed to group undertakings
2,893,706
2,893,706
Derivative financial instruments
1,031,432
1,470,835
21,116,506
24,536,087
ALERT COMMUNICATIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
15
Creditors: amounts falling due after more than one year
(Continued)
- 22 -

Included within creditors: amounts falling due after more than one year is an amount of £6,348,117 (2023: £9,630,967) in respect of liabilities payable or repayable by instalments which fall due for payment after more than five years from the reporting date.

 

Amounts owed to Group undertakings relate to a shareholder loan which bears interest at a rate of 14.04% per annum with interest accruing daily. Final repayment of the loan is due in 2030. The sum was advanced under a subordinated secured loan agreement and is therefore secured by way of a floating charge over the assets of the Company, a fixed charge over the shares of the Company, and a floating charge over the assets of Alert Communications (Holdings) Limited.

 

The bank loan is secured by a bond and floating charge over all the assets, rights and undertakings of the Company and a floating charge over the assets of Alert Communications (Holdings) Limited. The loan is repayable under an instalment scheme, the final repayment is due on 31 March 2030. The loan has an interest rate swap arrangement receiving SONIA and paying interest fixed at 5.97% for the full amount of the loan drawn, plus a margin of 0.6%, hence fixing the total interest payable on the bank loan to 6.57%. The full amount of loan drawdown at 31 March 2024 is £20,321,220 (2023: £22,890,456). Issue costs of £150,418 (2023: £167,103) have been set off against the total loan drawdowns.

16
Deferred taxation

The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:

Liabilities
Liabilities
Assets
Assets
2024
2023
2024
2023
Balances:
£
£
£
£
Accelerated capital allowances
-
2,025,282
(1,681,948)
-
Unused Tax losses
-
-
2,806,789
3,020,092
Derivative financial instruments
-
-
257,857
367,709
-
2,025,282
1,382,698
3,387,801
2024
Movements in the year:
£
Asset at 1 April 2023
(1,362,519)
Credit to profit or loss
(130,031)
Charge to other comprehensive income
109,852
Asset at 31 March 2024
(1,382,698)

The net deferred tax liability expected to reverse in 2025 is £47,270 (2024: £113,145). This primarily relates to the reversal of timing differences on capital allowances offset by expected utilisation of tax losses and short term timing differences.

ALERT COMMUNICATIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 23 -
17
Called up share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary Shares of £1 each
476,000
476,000
476,000
476,000

There is a single class of ordinary share. There are no restrictions on the distribution of dividends and the repayment of capital.

18
Profit and loss reserve

The hedging reserve records fair value movements on cash flow and net investment hedging instruments.

 

Retained earnings records retained earnings and accumulated losses.

19
Related party transactions

The Company is wholly owned by Alert Communications (Holdings) Limited and has taken advantage of the exemption in section 33 of FRS 102 'Related Party Disclosures', that allows it not to disclose transactions with wholly owned members of a group.

 

The following disclosures are with entities in the Group that are not wholly owned:

 

The Company paid £6,107,742 (2023: £3,856,974) to Babcock Communications Limited in connection with the operation, maintenance, build and management fees. Babcock Communications Limited is a subsidiary of Babcock International Group PLC, which ultimately holds 20% of the share capital in Alert Communications Group Holdings Limited. At the year end fees of £424,803 (2023: £446,756) were outstanding.

 

The Company also paid £nil (2023: £28,937) to Babcock Communications Limited and £59,665 (2023: £52,568) to BIIF Bidco Limited for Directors fees.

 

During the year Infrastructure Managers Limited, a fellow group company, provided management services to Alert Communications Limited.

20
Ultimate controlling party

The immediate parent undertaking is Alert Communications (Holdings) Limited.

 

The intermediate parent undertaking is BIIF Holdco Limited, which is the parent undertaking of the smallest and largest group to consolidate these financial statements. Copies of BIIF Holdco Limited consolidated financial statements can be obtained from the Company Secretary at Cannon Place, 78 Cannon Street, London, EC4N 6AF.

The ultimate parent and controlling party is BIIF L.P. BIIF L.P. is owned by a number of investors with no one investor having individual control.

ALERT COMMUNICATIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 24 -
21
Prior period adjustment

During the year it was identified that in the year ending 31 March 2023, interest had not been charged on the unpaid interest relating to the preference shares held. An adjustment has been made to account for this additional interest.

Changes to the statement of financial position
As previously reported
Adjustment
As restated at 31 Mar 2023
£
£
£
Current assets
Debtors due within one year
5,548,066
240,720
5,788,786
Capital and reserves
Profit and loss reserve
(1,011,799)
240,720
(771,079)
Changes to the income statement
As previously reported
Adjustment
As restated
Period ended 31 March 2023
£
£
£
Interest receivable and similar income
276,135
240,720
516,855
Profit for the financial period
880,371
240,720
1,121,091
Reconciliation of changes in equity
1 April
31 March
2022
2023
£
£
Adjustments to prior year
Interest receivable on accrued interest
-
240,720
Equity as previously reported
(4,512,870)
(1,638,925)
Equity as adjusted
(4,512,870)
(1,398,205)
Analysis of the effect upon equity
Profit and loss reserve
-
240,720
Reconciliation of changes in profit for the previous financial period
2023
£
Adjustments to prior year
Interest receivable on accrued interest
240,720
Profit as previously reported
880,371
Profit as adjusted
1,121,091
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