REGISTERED NUMBER: |
Strategic Report, Report of the Directors and |
Financial Statements |
for the Period 1 March 2023 to 3 March 2024 |
for |
Stange & Co. Limited |
REGISTERED NUMBER: |
Strategic Report, Report of the Directors and |
Financial Statements |
for the Period 1 March 2023 to 3 March 2024 |
for |
Stange & Co. Limited |
Stange & Co. Limited (Registered number: 00639690) |
Contents of the Financial Statements |
for the period 1 March 2023 to 3 March 2024 |
Page |
Company Information | 1 |
Strategic Report | 2 |
Report of the Directors | 4 |
Report of the Independent Auditors | 6 |
Income Statement | 9 |
Other Comprehensive Income | 10 |
Balance Sheet | 11 |
Statement of Changes in Equity | 12 |
Cash Flow Statement | 13 |
Notes to the Cash Flow Statement | 14 |
Notes to the Financial Statements | 16 |
Stange & Co. Limited |
Company Information |
for the period 1 March 2023 to 3 March 2024 |
DIRECTORS: |
SECRETARY: |
REGISTERED OFFICE: |
REGISTERED NUMBER: |
AUDITORS: |
Chartered Accountants |
& Statutory Auditors |
St George's Court |
Winnington Avenue |
Northwich |
Cheshire |
CW8 4EE |
Stange & Co. Limited (Registered number: 00639690) |
Strategic Report |
for the period 1 March 2023 to 3 March 2024 |
The directors present their strategic report for the period 1 March 2023 to 3 March 2024. The financial statements are prepared to the Sunday closest to the February accounting reference date. |
REVIEW OF BUSINESS |
The year, whilst challenging, didn't throw any world altering events at us. We finally seem to have had a year without a new global disaster, Mr Putin appears contained, pandemics appear to be out of fashion and inflation by most accounts, appears to have peaked. |
The number of pubs we operated this year increased from eight to nine, with the Ring O'Bells opening in West Kirby in mid-December 2023 and I'm pleased to report, has traded very well from the start. Annual sales for the group increased from £13.7m to £15.9m, £600k being attributable to the new pub, the rest being a continued post COVID recovery and The Ship and The Glengower continuing to build following refurbishments in the prior year. |
Thankfully some of those sales have made it to the bottom line, with Pub EBITDA (being EBITDA generated by the pubs, before central costs) increasing from £2.1m to £2.8m, Group EBITDA increasing from £1.4m to £1.9m and net profits before tax increasing from £571k to £1.10m. These metrics are the company's key performance indicators and all show positive movements |
This increase in performance hides some serious cost challenges faced by the business. The National Living Wage increase, and the corresponding increases right the way up the pay scale, have placed immense pressure on the bottom line. Whilst we have always strived to pay well, above inflationary increases year on year, have not been matched by above inflation increases in our selling prices, resulting in operating margins getting squeezed. The break-even point for a pub now, compared to five years ago, has moved on by several thousand a week, which we're just not seeing represented in sales growth. The viability of many smaller pubs in our industry will certainly be in doubt. This may create some opportunity but undoubtedly reduces choice, variation and the seeds from which great hospitality industries can grow. |
During the year there were also continued increased costs in utilities, products and consumables, some of which we've passed on through price or mitigated, some we've had to absorb. |
These cost pressures have also been felt in our customers pockets, and whilst they have, on aggregate had pay increases, they have experienced a squeeze on their disposable income, which has been evident in our year on year volumes in some of our more established pubs. |
One of the biggest challenges of recent years has been recruitment, this has continued to ease this year, not necessarily to pre-covid levels, but to the extent that all pubs this year have been able to fully trade through peak periods, helping sales and the bottom line. |
The poor weather during the summer has impacted sales at a key time for our coastal sites, however this is the cream on the top for those pubs, rather than the mainstay of the trade. But we have missed those bumper days and weeks that we would normally enjoy. |
PRINCIPAL RISKS AND UNCERTAINTIES |
With ongoing wars in Middle-East and Ukraine and a potential return of Mr Trump to the White House, this does not create conditions for a calm world order. Therefore, the direction of travel for inflation and interest rates remains far from certain and constantly in the news. All of which impacts consumer confidence, behaviour and spending. The incoming Labour government have also made it clear that tax rises are on the way, which could erode consumer spending and business confidence further. |
We as a company are somewhat insulated from these movements, with fixed interest rates on much of our debt and fixed price contracts for utilities and most of our supplies. Also with slightly higher operating margins due to operating freeholds we have headroom should margins be challenged. |
Having said this, sales within our pubs, and the wider industry has remained remarkably resilient in the face of several serious challenges in recent years and we remain optimistic, with the unique proposition that our pubs offer in their style, location and quality. |
The weather in the current year has also remained unpredictable and we have had a second consecutive Summer of wet and windy weather, which has restricted the use of gardens and terraces and has curtailed those bumper weeks that we traditionally get in Spring and Summer. The concern is that, in the medium to longer term this becomes the norm as a result of climate change, whilst our pubs generally work well whatever the weather, that additional trade from outdoor spaces may no longer be relied upon. |
Stange & Co. Limited (Registered number: 00639690) |
Strategic Report |
for the period 1 March 2023 to 3 March 2024 |
CURRENT TRADING |
Trading in the current year remains steady with most pubs in growth on last year, but this tends to be in value rather than volume. With the addition of the Ring O'Bells the group year to date is trading 18% up year on year and 2% on a like for like basis. Unbelievably, the weather has been worse than last year, we weren't sure that was even possible. An early Easter, The Euros and lack of The Open golf championship at Hoylake this year also made for some challenging year on year comparisons. |
Costs whilst levelling out, remain at a higher level than a few years ago, wages being the most challenging currently. We are maintaining gross margin, but operating margin is under pressure. Forecast EBITDA for the year is ahead of last year, helped by the opening an additional pub, but frustratingly due to the above factors, not all that incremental EBITDA will make it the bottom line for the group. |
FUTURE |
We have recently completed on the purchase of our tenth pub, The Brookhouse Mill in Denbigh in North Wales, it's going to require a fair bit of TLC and knocking around, but we're confident it has all the attributes for a great pub. Assuming planning goes smoothly we hope to have it open towards Autumn 2025. |
Customer demand appears fairly resilient in our existing pubs, despite the economic headwinds. The desire to meet up with friends and family seems to be as strong as ever and is being prioritised above other forms of discretionary spending. We therefore remain optimistic for our pubs and the group in the months and years ahead. |
ON BEHALF OF THE BOARD: |
Stange & Co. Limited (Registered number: 00639690) |
Report of the Directors |
for the period 1 March 2023 to 3 March 2024 |
The directors present their report with the financial statements of the company for the period 1 March 2023 to 3 March 2024. |
DIVIDENDS |
No dividends will be distributed for the period ended 3 March 2024. |
DIRECTORS |
The directors shown below have held office during the whole of the period from 1 March 2023 to the date of this report. |
ENGAGEMENT WITH EMPLOYEES |
Disabled employees |
The company is committed to employment policies which follow best practice, based on equal opportunities for all employees regardless of race, sex, colour, disability or marital status. The company gives full and fair consideration to applications for employment from disabled persons, having regard to their aptitudes and abilities. Appropriate arrangements are made for the continued employment and training, career development and promotion of disabled employees. If members of staff become disabled the company continues employment, either in the same or an alternative role, with provides appropriate retraining if necessary. |
Employee involvement |
The company provides employees with information on matters of concern to them so that their views can be taken into account when making decisions that are likely to affect their interests. Employee involvement in the company is encouraged via regular meetings to update employees on performance and developments. |
STATEMENT OF DIRECTORS' RESPONSIBILITIES |
The directors are responsible for preparing the Strategic Report, the Report of the Directors 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 United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law), including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and 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; |
- | 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 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. |
STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS |
So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and each director has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the company's auditors are aware of that information. |
Stange & Co. Limited (Registered number: 00639690) |
Report of the Directors |
for the period 1 March 2023 to 3 March 2024 |
AUDITORS |
The auditors, Bennett Brooks & Co Limited, will be proposed for re-appointment at the forthcoming Annual General Meeting. |
ON BEHALF OF THE BOARD: |
Report of the Independent Auditors to the Members of |
Stange & Co. Limited |
Opinion |
We have audited the financial statements of Stange & Co. Limited (the 'company') for the period ended 3 March 2024 which comprise the Income Statement, Other Comprehensive Income, Balance Sheet, Statement of Changes in Equity, Cash Flow Statement and Notes to the Cash Flow Statement, Notes to the Financial Statements, 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 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice). |
_ |
In our opinion the financial statements: |
- | give a true and fair view of the state of the company's affairs as at 3 March 2024 and of its profit for the period then ended; |
- | have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and |
- | have been prepared in accordance with the requirements of the Companies Act 2006. |
Basis for opinion |
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC'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. |
Conclusions relating to going concern |
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate. |
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the 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. |
Other information |
The directors are responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon. |
Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. |
In connection with our audit of the financial 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 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. |
Opinions on other matters prescribed by the Companies Act 2006 |
In our opinion, based on the work undertaken in the course of the audit: |
- | the information given in the Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
- | the Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements. |
Matters on which we are required to report by exception |
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Report of the Directors. |
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion: |
- | adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or |
- | the financial statements are not in agreement with the accounting records and returns; or |
- | certain disclosures of directors' remuneration specified by law are not made; or |
- | we have not received all the information and explanations we require for our audit. |
Report of the Independent Auditors to the Members of |
Stange & Co. Limited |
Responsibilities of directors |
As explained more fully in the Statement of Directors' Responsibilities set out on page four, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine 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 a Report of the Auditors 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. |
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 UK tax legislation and regulations which govern the preparation of financial statements, and we considered the extent to which non-compliance might have a material effect on the financial statements. We also considered those laws and regulations that have a direct impact on the financial statements such as the Companies Act 2006. 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 posting inappropriate journal entries to increase revenue, through management bias in manipulation of accounting estimates or accounting for significant transactions outside the normal course of business. Audit procedures performed included: |
-Enquiry of management around actual and potential litigation and claims and instances of non-compliance with laws and regulations; |
- Auditing the risk of management override of controls, through testing journal entries and other adjustments for appropriateness, testing accounting estimates (because of the risk of management bias), and evaluating the business rationale of significant transactions outside the normal course of business; and |
- Reviewing financial statement disclosures and agreeing to supporting documentation to assess compliance with applicable laws and regulations. |
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 Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors. |
Report of the Independent Auditors to the Members of |
Stange & Co. Limited |
Use of our report |
This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 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 a Report of the Auditors 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 Auditors |
St George's Court |
Winnington Avenue |
Northwich |
Cheshire |
CW8 4EE |
Stange & Co. Limited (Registered number: 00639690) |
Income Statement |
for the period 1 March 2023 to 3 March 2024 |
Period |
1.3.23 |
to | Year Ended |
3.3.24 | 28.2.23 |
Notes | £ | £ |
TURNOVER |
Cost of sales | ( |
) | ( |
) |
GROSS PROFIT |
Administrative expenses | ( |
) | ( |
) |
1,352,891 | 856,274 |
Other operating income |
OPERATING PROFIT | 4 |
Interest receivable and similar income |
1,361,457 | 863,390 |
Interest payable and similar expenses | 5 | ( |
) | ( |
) |
PROFIT BEFORE TAXATION |
Tax on profit | 6 | ( |
) | ( |
) |
PROFIT FOR THE FINANCIAL PERIOD |
Stange & Co. Limited (Registered number: 00639690) |
Other Comprehensive Income |
for the period 1 March 2023 to 3 March 2024 |
Period |
1.3.23 |
to | Year Ended |
3.3.24 | 28.2.23 |
Notes | £ | £ |
PROFIT FOR THE PERIOD |
OTHER COMPREHENSIVE INCOME | - | - |
TOTAL COMPREHENSIVE INCOME FOR THE PERIOD |
Stange & Co. Limited (Registered number: 00639690) |
Balance Sheet |
3 March 2024 |
2024 | 2023 |
Notes | £ | £ |
FIXED ASSETS |
Intangible assets | 7 |
Tangible assets | 8 |
Investments | 9 |
CURRENT ASSETS |
Stocks | 10 |
Debtors | 11 |
Cash at bank and in hand |
CREDITORS |
Amounts falling due within one year | 12 | ( |
) | ( |
) |
NET CURRENT LIABILITIES | ( |
) | ( |
) |
TOTAL ASSETS LESS CURRENT LIABILITIES |
CREDITORS |
Amounts falling due after more than one year | 13 | ( |
) | ( |
) |
PROVISIONS FOR LIABILITIES | 17 | ( |
) | ( |
) |
NET ASSETS |
CAPITAL AND RESERVES |
Called up share capital | 18 |
Revaluation reserve | 19 |
Retained earnings | 19 |
SHAREHOLDERS' FUNDS |
The financial statements were approved by the Board of Directors and authorised for issue on |
Stange & Co. Limited (Registered number: 00639690) |
Statement of Changes in Equity |
for the period 1 March 2023 to 3 March 2024 |
Called up |
share | Retained | Revaluation | Total |
capital | earnings | reserve | equity |
£ | £ | £ | £ |
Balance at 1 March 2022 |
Changes in equity |
Total comprehensive income | - |
Total transactions with owners, recognised directly in equity |
- |
- |
- |
- |
Balance at 28 February 2023 | 219,250 | 4,339,313 | 153,833 | 4,712,396 |
Changes in equity |
Total comprehensive income | - |
Total transactions with owners, recognised directly in equity |
- |
- |
- |
- |
Balance at 3 March 2024 | 153,833 |
Stange & Co. Limited (Registered number: 00639690) |
Cash Flow Statement |
for the period 1 March 2023 to 3 March 2024 |
Period |
1.3.23 |
to | Year Ended |
3.3.24 | 28.2.23 |
Notes | £ | £ |
Cash flows from operating activities |
Cash generated from operations | 1 |
Interest paid | ( |
) | ( |
) |
Interest element of finance lease payments paid | ( |
) |
Tax paid | ( |
) |
Net cash from operating activities |
Cash flows from investing activities |
Purchase of tangible fixed assets | ( |
) | ( |
) |
Sale of tangible fixed assets |
Interest received |
Net cash from investing activities | ( |
) | ( |
) |
Cash flows from financing activities |
New loans in year |
Loan repayments in year | ( |
) | ( |
) |
Capital repayments in year | ( |
) | ( |
) |
Amount introduced by directors | 5,817 | - |
Amount withdrawn by directors | - | (6,000 | ) |
Net cash from financing activities | ( |
) |
Increase in cash and cash equivalents |
Cash and cash equivalents at beginning of period | 2 | 215,826 |
Cash and cash equivalents at end of period | 2 | 537,867 | 321,034 |
Stange & Co. Limited (Registered number: 00639690) |
Notes to the Cash Flow Statement |
for the period 1 March 2023 to 3 March 2024 |
1. | RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS |
Period |
1.3.23 |
to | Year Ended |
3.3.24 | 28.2.23 |
£ | £ |
Profit before taxation |
Depreciation charges |
Profit on disposal of fixed assets | ( |
) |
Finance costs | 262,872 | 291,989 |
Finance income | (4,453 | ) | (3 | ) |
1,901,240 | 1,363,201 |
Increase in stocks | ( |
) | ( |
) |
Increase in trade and other debtors | ( |
) | ( |
) |
Increase in trade and other creditors |
Cash generated from operations |
2. | CASH AND CASH EQUIVALENTS |
The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts: |
Period ended 3 March 2024 |
3.3.24 | 1.3.23 |
£ | £ |
Cash and cash equivalents | 537,867 | 321,034 |
Year ended 28 February 2023 |
28.2.23 | 1.3.22 |
£ | £ |
Cash and cash equivalents | 321,034 | 215,826 |
Stange & Co. Limited (Registered number: 00639690) |
Notes to the Cash Flow Statement |
for the period 1 March 2023 to 3 March 2024 |
3. | ANALYSIS OF CHANGES IN NET DEBT |
Other |
non-cash |
At 1.3.23 | Cash flow | changes | At 3.3.24 |
£ | £ | £ | £ |
Net cash |
Cash at bank |
and in hand | 321,034 | 216,833 | 537,867 |
321,034 | 537,867 |
Debt |
Finance leases | (159,312 | ) | 17,048 | (190,084 | ) | (332,348 | ) |
Debts falling due |
within 1 year | (398,855 | ) | (37,863 | ) | - | (436,718 | ) |
Debts falling due |
after 1 year | (3,959,930 | ) | (399,372 | ) | - | (4,359,302 | ) |
(4,518,097 | ) | (420,187 | ) | (190,084 | ) | (5,128,368 | ) |
Total | (4,197,063 | ) | (203,354 | ) | (190,084 | ) | (4,590,501 | ) |
Stange & Co. Limited (Registered number: 00639690) |
Notes to the Financial Statements |
for the period 1 March 2023 to 3 March 2024 |
1. | STATUTORY INFORMATION |
Stange & Co. Limited is a private company, limited by shares, incorporated and registered in England and Wales. The company's registered number and registered office address can be found on the Company Information page. |
2. | ACCOUNTING POLICIES |
Basis of preparing the financial statements |
Preparation of consolidated financial statements |
The company is also a parent entity and holds the entire share capital of Stange Inn & Co Limited, which is dormant and has share capital and net assets of £100. The company has not prepared consolidated accounts in accordance with Section 402 of the Companies Act 2006 as its subsidiary undertaking is excluded from consolidation under section 405 of the Companies Act on materiality grounds. |
Related party exemption |
The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party transactions with wholly owned subsidiaries within the group. |
Going concern |
The company has net current liabilities at 3 March 2024 of £2,572,266 (2023: £2,302,654). The company meets its day-to-day working capital requirements through its bank facilities which are secured on the company's assets. As noted in the Strategic Report, the current economic conditions continue to create uncertainty over customer confidence and the potential impact on consumer spending in the company's pubs. The directors have prepared cashflow forecasts that take into account this economic uncertainty and the availability of funding from their bankers. |
The company's forecasts and projections, taking account a severe but plausible change in trading performance, show that the company should be able to operate within the level of its current facilities. After making enquiries, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. The company therefore continues to adopt the going concern basis in preparing its financial statements. |
Turnover |
Turnover represents sales (excluding taxes) of goods and services net of discounts. Turnover principally consists of sales of food, drink and accommodation which are recognised at the point at which goods and services are provided. |
Cost of sales |
Presented within cost of sales are direct costs of operating the company's pubs and inns, including stock purchases (wet and dry) and payroll costs of the service staff. This is considered a more appropriate presentation of the nature of the costs and payroll costs of the service staff of £5,508,325 have been re-classified from administrative expenses for the year ended 28 February 2023. |
Goodwill |
Goodwill, being the amount paid in connection with acquisitions, is initially measured at cost. After initial recognition goodwill is measured at cost less any accumulated amortisation and any accumulated impairment losses. Goodwill is being amortised evenly over its estimated useful life of 10 years. |
Stange & Co. Limited (Registered number: 00639690) |
Notes to the Financial Statements - continued |
for the period 1 March 2023 to 3 March 2024 |
2. | ACCOUNTING POLICIES - continued |
Tangible fixed assets |
Freehold property are stated at cost (or frozen at deemed cost held at valuation at the date of transition to FRS 102) less accumulated depreciation. |
Freehold properties owned by the company and long leaseholds have not been depreciated because, in the opinion of the directors, the programme of the refurbishment and repair maintains the properties to a standard whereby the total residual value will be maintained. Consequently, the amount of any depreciation would not be material. |
Other fixed assets are stated at cost less accumulated depreciation. Cost includes the original purchase price of the asset and the costs attributable to bringing the asset to its working condition for its intended use. |
Depreciation is provided on all tangible fixed assets, at rates calculated to write off the cost, less estimated residual value, of each asset on a systematic basis over its expected useful life as follows: |
Fixtures and fittings | 15% reducing balance |
Motor vehicles | 25% reducing balance |
Improvements to property | 10% straight line |
Stocks |
Stock is valued at the lower of cost and net realisable value. Cost includes the purchase cost of the item. Provision is made for slow moving items. |
Taxation |
Taxation for the period comprises current and deferred tax. Tax is recognised in the Income Statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. |
Current or deferred taxation assets and liabilities are not discounted. |
Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date. |
Deferred tax |
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date. |
Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the period end and that are expected to apply to the reversal of the timing difference. |
Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. |
Hire purchase and leasing commitments |
Assets obtained under hire purchase contracts or finance leases are capitalised in the balance sheet. Those held under hire purchase contracts are depreciated over their estimated useful lives. Those held under finance leases are depreciated over their estimated useful lives or the lease term, whichever is the shorter. |
The interest element of these obligations is charged to profit or loss over the relevant period. The capital element of the future payments is treated as a liability. |
Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the lease. |
Pension costs and other post-retirement benefits |
The company operates a defined contribution pension scheme. Contributions payable to the company's pension scheme are charged to profit or loss in the period to which they relate. |
Stange & Co. Limited (Registered number: 00639690) |
Notes to the Financial Statements - continued |
for the period 1 March 2023 to 3 March 2024 |
2. | ACCOUNTING POLICIES - continued |
Impairment of non-financial assets |
At each balance sheet date non-financial assets are assessed to determine whether there is an indication that the asset (or asset's cash generating unit) may be impaired. If there is such an indication the recoverable amount of the asset (or asset's cash generating unit) is compared to the carrying amount of the asset (or asset's cash generating unit). |
The recoverable amount of the asset (or asset's cash generating unit) is the higher of the fair value less costs to sell and value in use. Value in use is defined as the present value of the future cash flows before interest and tax obtainable as a result of the asset's (or asset's cash generating unit's) continued use. These cash flows are discounted using a pre-tax discount rate that represents the current market risk-free rate and the risks inherent in the asset. |
If the recoverable amount of the asset (or asset's cash generating unit) is estimated to be lower than the carrying amount, the carrying amount is reduced to its recoverable amount. An impairment loss is recognised in the profit and loss account, unless the asset has been revalued when the amount is recognised in other comprehensive income to the extent of any previously recognised revaluation. Thereafter any excess is recognised in profit or loss. |
If an impairment loss is subsequently reversed, the carrying amount of the asset (or asset's cash generating unit) is increased to the revised estimate of its recoverable amount, but only to the extent that the revised carrying amount does not exceed the carrying amount that would have been determined (net of depreciation or amortisation) had no impairment loss been recognised in prior periods. A reversal of an impairment loss is recognised in the profit and loss account |
Critical accounting judgements and estimation uncertainty |
Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. |
a. Critical judgements in applying the company's accounting policies |
i. Carrying value of freehold and long-leasehold properties |
The directors are of the opinion that the programme of refurbishment and repair maintains the properties to a standard whereby the total residual value will be maintained, and as a result, the depreciable amount and annual depreciation charge would not be material. This requires judgement. |
b. Key accounting estimates and assumptions |
The company makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are addressed below |
i. Recoverable amount of fixed assets and goodwill |
Annually, the company considers whether fixed assets and/or goodwill are impaired. Where an indication of impairment is identified the estimation of recoverable value requires estimation of the recoverable value of the pubs (the company's cash generating units or CGUs). This requires estimation of the future cash flows from the CGUs and also selection of appropriate discount rates in order to calculate the net present value of those cash flows. |
The directors have noted the uncertain economic conditions at the present time, however, given the positive cash generating nature of each individual pub, the directors can foresee no reasonably possible scenario which would see the recoverable amount to be lower than the higher of fair value less costs to sell and value in use. |
Subsidiary investment |
The subsidiary investment is stated in the parent company’s balance sheet at cost less any provisions for impairment. |
Stange & Co. Limited (Registered number: 00639690) |
Notes to the Financial Statements - continued |
for the period 1 March 2023 to 3 March 2024 |
2. | ACCOUNTING POLICIES - continued |
Share capital |
Ordinary shares are classed as equity. |
Short term debtors and creditors |
Short term debtors and creditors with no stated interest rate are recorded at transaction price. Any losses arising from impairment are recognised in the profit and loss account. |
Distributions to equity holders |
Dividends are recognised as a liability in the financial statements in the period in which the dividends are approved by the company's shareholders. These amounts are recognised in the statement of changes in equity. |
Cash and cash equivalents |
Cash and cash equivalents includes cash in hand, cash held with banks and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities. |
Loans and borrowings |
Loans and borrowings are initially recognised at the transaction price including transaction costs. Subsequently, they are measure at amortised cost using the effective interest rate method, less impairment. |
Operating leases |
Rentals payable under operating leases are charged to the profit and loss account on a straight line basis over the period of the lease. |
3. | EMPLOYEES AND DIRECTORS |
2024 | 2023 |
£ | £ |
Wages and salaries | 6,234,328 | 5,549,504 |
Social security costs | 504,597 | 464,659 |
Pension costs | 166,953 | 144,992 |
6,905,878 | 6,159,155 |
The average number of employees during the year was as follows: |
2024 | 2023 |
Directors | 2 | 2 |
Administration | 7 | 5 |
Management | 57 | 60 |
Service staff | 283 | 262 |
349 | 329 |
Period |
1.3.23 |
to | Year Ended |
3.3.24 | 28.2.23 |
£ | £ |
Directors' remuneration |
Directors' pension contributions to money purchase schemes |
The number of directors to whom retirement benefits were accruing was as follows: |
Money purchase schemes |
Stange & Co. Limited (Registered number: 00639690) |
Notes to the Financial Statements - continued |
for the period 1 March 2023 to 3 March 2024 |
4. | OPERATING PROFIT |
The operating profit is stated after charging/(crediting): |
Period |
1.3.23 |
to | Year Ended |
3.3.24 | 28.2.23 |
£ | £ |
Hire of plant & machinery |
Depreciation - owned assets |
Depreciation - assets on finance leases |
Profit on disposal of fixed assets | ( |
) |
Goodwill amortisation |
Auditors' remuneration |
5. | INTEREST PAYABLE AND SIMILAR EXPENSES |
Period |
1.3.23 |
to | Year Ended |
3.3.24 | 28.2.23 |
£ | £ |
Bank interest |
Bank loan interest |
HMRC interest |
Other interest |
HP finance interest |
6. | TAXATION |
Analysis of the tax charge |
The tax charge on the profit for the period was as follows: |
Period |
1.3.23 |
to | Year Ended |
3.3.24 | 28.2.23 |
£ | £ |
Current tax: |
UK corporation tax |
Deferred tax |
Tax on profit |
Stange & Co. Limited (Registered number: 00639690) |
Notes to the Financial Statements - continued |
for the period 1 March 2023 to 3 March 2024 |
6. | TAXATION - continued |
Reconciliation of total tax charge included in profit and loss |
The tax assessed for the period is higher than the standard rate of corporation tax in the UK. The difference is explained below: |
Period |
1.3.23 |
to | Year Ended |
3.3.24 | 28.2.23 |
£ | £ |
Profit before tax |
Profit multiplied by the standard rate of corporation tax in the UK of |
Effects of: |
Expenses not deductible for tax purposes |
Amortisation of goodwill | 12,617 | 9,787 |
undertakings |
Impact of rate change | 2,944 | 25,114 |
Impact of super-deduction | - | (38,281 | ) |
Movement in deferred tax not recognised | (6,363 | ) | - |
Total tax charge | 287,267 | 124,485 |
Factors that may affect future tax charges |
In the Spring Budget 2021, the UK Government announced that from 1 April 2023 the corporation tax rate would increase to 25% (rather than remaining reducing at 19%, as previously enacted). This new law was substantively enacted on 24 May 2021. Deferred taxes at the balance sheet date have been measured using these enacted tax rates and reflected in these financial statements.The blended current tax rate for the period ended 3 March 2024 was 24.5%. |
7. | INTANGIBLE FIXED ASSETS |
Goodwill |
£ |
COST |
At 1 March 2023 |
and 3 March 2024 |
AMORTISATION |
At 1 March 2023 |
Amortisation for period |
At 3 March 2024 |
NET BOOK VALUE |
At 3 March 2024 |
At 28 February 2023 |
The goodwill relates to the previous acquisition of The Queen's Head in 2019 and the acquisition of Ring O Bells in 2020. |
Stange & Co. Limited (Registered number: 00639690) |
Notes to the Financial Statements - continued |
for the period 1 March 2023 to 3 March 2024 |
8. | TANGIBLE FIXED ASSETS |
Freehold | Long | Improvements |
property | leasehold | to property |
£ | £ | £ |
COST |
At 1 March 2023 |
Additions |
Disposals |
At 3 March 2024 |
DEPRECIATION |
At 1 March 2023 |
Charge for period |
Eliminated on disposal |
At 3 March 2024 |
NET BOOK VALUE |
At 3 March 2024 |
At 28 February 2023 |
Fixtures |
and | Motor |
fittings | vehicles | Totals |
£ | £ | £ |
COST |
At 1 March 2023 |
Additions |
Disposals | ( |
) | ( |
) |
At 3 March 2024 |
DEPRECIATION |
At 1 March 2023 |
Charge for period |
Eliminated on disposal | ( |
) | ( |
) |
At 3 March 2024 |
NET BOOK VALUE |
At 3 March 2024 |
At 28 February 2023 |
Following the transition to FRS 102, the freehold property is held at deemed cost. |
Stange & Co. Limited (Registered number: 00639690) |
Notes to the Financial Statements - continued |
for the period 1 March 2023 to 3 March 2024 |
8. | TANGIBLE FIXED ASSETS - continued |
Fixed assets, included in the above, which are held under finance leases are as follows: |
Fixtures |
and |
fittings |
£ |
COST |
At 1 March 2023 |
Additions |
At 3 March 2024 |
DEPRECIATION |
At 1 March 2023 |
Charge for period |
At 3 March 2024 |
NET BOOK VALUE |
At 3 March 2024 |
At 28 February 2023 |
9. | FIXED ASSET INVESTMENTS |
Unlisted |
investments |
£ |
COST |
At 1 March 2023 |
and 3 March 2024 |
NET BOOK VALUE |
At 3 March 2024 |
At 28 February 2023 |
The company's investments at the Balance Sheet date in the share capital of companies include the following: |
Registered office: 19 Trinity Square, Llandudno, Gwynedd, LL30 2RD |
Nature of business: |
% |
Class of shares: | holding |
In a prior year, the investment was written down to its recoverable amount accordingly, being £100. |
10. | STOCKS |
2024 | 2023 |
£ | £ |
Trading stock |
Stange & Co. Limited (Registered number: 00639690) |
Notes to the Financial Statements - continued |
for the period 1 March 2023 to 3 March 2024 |
11. | DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2024 | 2023 |
£ | £ |
Other debtors |
Amounts owed by group |
undertakings | 882 | - |
Directors' current accounts | 32,334 | 38,151 |
Prepayments |
12. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2024 | 2023 |
£ | £ |
Bank loans and overdrafts (see note 14) |
Other loans (see note 14) |
Finance leases (see note 15) |
Trade creditors |
Amounts owed to group undertakings |
Corporation tax |
Social security & other taxes |
VAT | 571,633 | 826,399 |
Other creditors |
Due to related parties | 200,000 | 200,000 |
Directors' current accounts | 113 | 113 |
Accrued expenses |
13. | CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR |
2024 | 2023 |
£ | £ |
Bank loans (see note 14) |
Finance leases (see note 15) |
14. | LOANS |
An analysis of the maturity of loans is given below: |
2024 | 2023 |
£ | £ |
Amounts falling due within one year or on demand: |
Bank loans |
Other loans |
Amounts falling due between one and two years: |
Bank loans - 1-2 years |
Amounts falling due between two and five years: |
Bank loans - 2-5 years |
Stange & Co. Limited (Registered number: 00639690) |
Notes to the Financial Statements - continued |
for the period 1 March 2023 to 3 March 2024 |
14. | LOANS - continued |
2024 | 2023 |
£ | £ |
Amounts falling due in more than five years: |
Repayable by instalments |
Bank loans - 5+ years | 2,784,866 | 2,471,063 |
Included in bank loans is an amount of £3,622,694 (2023: £3,872,190) which is payable in 133 monthly instalments and carries an interest rate of 4.1% per annum. |
A new bank loan was taken out in the period. The loan had a balance of £854,577 at the year end, this is payable in 144 monthly instalments and carries a flat interest rate of 4.27% per annum. |
The remainder of the loan balance relates to a CBILS loan. The CBILS loan had a balance of £318,748 (2023: £460,206) at year end, this is payable in 29 monthly instalments and carries an interest rate of 6% pa annum over Bank of England base rate. |
15. | LEASING AGREEMENTS |
Minimum lease payments under finance leases fall due as follows: |
Finance leases |
2024 | 2023 |
£ | £ |
Net obligations repayable: |
Within one year |
Between one and five years |
16. | SECURED DEBTS |
The following secured debts are included within creditors: |
2024 | 2023 |
£ | £ |
Bank loans |
Other loans |
Bank loans are secured by first legal mortgages over the company's freehold property and by a fixed and floating charge over all current and future assets of the company. |
17. | PROVISIONS FOR LIABILITIES |
2024 | 2023 |
£ | £ |
Deferred tax | 728,958 | 590,487 |
Deferred tax |
£ |
Balance at 1 March 2023 |
Charged to income statement | 138,471 |
Balance at 3 March 2024 |
The deferred tax charge/(credit) in the year relates to accelerated capital allowances. |
Stange & Co. Limited (Registered number: 00639690) |
Notes to the Financial Statements - continued |
for the period 1 March 2023 to 3 March 2024 |
18. | CALLED UP SHARE CAPITAL |
Allotted, issued and fully paid: |
Number: | Class: | Nominal | 2024 | 2023 |
value: | £ | £ |
Ordinary | £1 | 219,250 | 219,250 |
19. | RESERVES |
Retained | Revaluation |
earnings | reserve | Totals |
£ | £ | £ |
At 1 March 2023 | 4,493,146 |
Profit for the period |
At 3 March 2024 | 5,304,464 |
20. | PENSION COMMITMENTS |
Stange & Co. Limited provides a defined contribution scheme to its employees. The amount recognised as an expense for the defined contribution scheme was £166,953 (2023: £144,992). |
21. | DIRECTORS' ADVANCES, CREDITS AND GUARANTEES |
The following advances and credits to a director subsisted during the period ended 3 March 2024 and the year ended 28 February 2023: |
2024 | 2023 |
£ | £ |
Balance outstanding at start of period |
Amounts advanced |
Amounts repaid | ( |
) |
Amounts written off | - | - |
Amounts waived | - | - |
Balance outstanding at end of period |
22. | RELATED PARTY DISCLOSURES |
Key management personnel are considered to be the Board of Directors whose emoluments are disclosed in note 3. |
During the year the company incurred interest totalling £24,336 (2023: £18,535) paid to a related party of which a director of Stange & Co Limited is also a director. |
The balance due to the above related party at the balance sheet date was £200,000 (2023: £200,000). |
23. | ULTIMATE CONTROLLING PARTY |
Mr N Rowlands, Mr C L Rowlands, Mr D C McLennan and Mrs H M McLennan are considered to be the ultimate controlling parties who together hold 100% of the issued share capital. |