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Registered number: 05329479










PHO TRADING LIMITED










ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE PERIOD ENDED 25 FEBRUARY 2024

 
PHO TRADING LIMITED
 
 
COMPANY INFORMATION


Directors
Patrick Joseph Marrinan 
Stephen Wall (resigned 7 October 2023)
Wayne John Dejager (appointed 7 March 2023)




Registered number
05329479



Registered office
15 Clerkenwell Green

London

EC1R 0DP




Independent auditors
Haysmacintyre LLP

10 Queen Street Place

London

EC4R 1AG





 
PHO TRADING LIMITED
 

CONTENTS



Page
Strategic Report
1 - 6
Directors' Report
7 - 8
Independent Auditors' Report
9 - 12
Statement of Comprehensive Income
13
Balance Sheet
14 - 15
Statement of Changes in Equity
16
Notes to the Financial Statements
17 - 32


 
PHO TRADING LIMITED
 
 
STRATEGIC REPORT
FOR THE PERIOD ENDED 25 FEBRUARY 2024

Introduction
 
Pho Trading Limited (“the company”) operates a group of Vietnamese street food restaurants.
The Directors present their report and the audited financial statements for the 53-week period ended 25 Feb 2024. Overall, despite a challenging economic backdrop the company has performed well and with the introduction of new financing facilities continued to organically grow with the opening of new restaurants in the year. 

Business Review
 
The trading results and balance sheet and other financial statements are shown on pages 13 to 16.
Over the trading period the company has continued to face several industry-wide challenges, with the  “cost of living crisis”, national minimal wage inflation of +9.8% and  fluctuations in supply chain pricing due to  the ongoing Ukraine conflict.  
Turnover increased 22% to £71.1m (2023: £58.3m) with a gross margin of 79.2% (2023: 78.3%). Profit before tax is £3.6m (2023: £1.8m) EBITDA has increased by 24% to £7.2m (2023: £5.8m). Restaurant EBITDA (Site based only excluding central support costs) increased to £12.8m for the year (2023: £10.4m).
Due to the recent strong performance, directors’ confidence remains strong, and the company continues its expansion plans throughout the UK. This has been aided with additional funding secured in the Group in which this Company sits in the  financial year. During FY24 the company opened five new restaurants located in London Bridge, Milton Keynes, Canterbury, Liverpool, and Fulham . At the end of FY24 the company had 40 restaurants and 4 Dark Kitchens. Directors made the decision to sublet one of the restaurants in the year to a third party operator due to the proximity to other restaurants in the portfolio. In addition, the directors made the difficult decision to surrender the lease for another restaurant in the year that had not been re-opened since covid 2021 closure. This was driven by the changing appetite of the local population for dine in sales in the city post the COVID 19 and cannibalism of delivery sales by other sites and allowing management to focus on other expansion opportunities. Deliveroo also reduced the number of kitchens held in London resulting in the closure of one Dark Kitchen in the year. 
Post year end the company continues to grow and explore new opportunities and locations, at the time of writing three additional sites have been successfully added to the portfolio in Glasglow, Baker Street (London) and Norwich, with others currently under development. 

Page 1

 
PHO TRADING LIMITED
 
Principal risks and uncertainties
 
IInflation, Cost of living and economic confidence
Political instability in quickly changing political leaderships and the ongoing war in Ukraine have resulted in high levels of inflation continuing throughout FY24 and, at time of writing, are continuing into FY25 albeit with a more positive outlook. This has resulted in persistent pressure on customers’ disposable income. The directors have carefully considered the price point of the menu and believe the group remains competitively priced,  offering quality and good value for money. The directors continue monitor  menu pricing and perform benchmarking exercises against our competitors in the casual dining market sector. 
Supply Chain and input costs
As is being experienced by all UK business  input prices remain volatile, however management continue to invest in new systems allowing live tracking of key cost inputs and regularly review supplier contracts to ensure any opportunities to protect margins are capitalised upon.
Employee recruitment and retention
The casual dining sector continues to be a highly competitive market. The group continues to review the remuneration offered against our competitors in addition to the continued investment in employee wellbeing and benefits to ensure that we remain an employer of choice. 
Labour Costs
The significant increase in labour costs in the year has impacted all UK hospitality businesses, and the group monitors the labour cost base daily to maximise efficiency of the workforce.

Key Performance Indicators
 
The Directors receive a wide range of management information to monitor the performance of the business. Along with twice daily sales reports they receive total sales for the previous week, detailing food and beverage costs,  gross profit margins, and  other performance indicators including labour costs, like for like sales, average spend and number of covers.  This is then expanded upon for a complete monthly management pack. Key indicators are reported as follows:
Total Sales £71.1m (2023: £58.3m), Food Costs £12.72m (2023: £10.98m), Beverage Costs £2.06m (2023: £1.70m), Gross Profit Margin 79.2% (2023: 78.3%), Labour Costs £26.7m, (2023: £21.53m), Like for Like sales +6.6% (2023: +11.9%), Operating Profit £4m (2023: £2.2m), EBITDA £7.2m (2023: £5.8m), average spend £15.98 (2023: £15.43) and number of covers 4,448,248 (2023: 2,791,088).
The Company has seen an increase in like for like sales post year end (Q1 of FY24) as well as additional sales from new openings.

Page 2

 
PHO TRADING LIMITED
 
Future Developments
 
The company plans to continue with its expansion plans with several locations under active development and several other potential locations that have been identified.

Employees
Pho is an equal opportunities employer. The Group is committed to providing equal opportunities throughout the employment across all staff members, including recruitment, training and promotion regardless of age, gender, marital status sexual orientation, race, national or ethnic origin, religious orientation or beliefs or disability. All team members and applicants are treated equally, and the Group would take all reasonable adjustments to accommodate disabled workers and applicants. 
Pho is committed to eliminating discrimination and encouraging diversity amongst the entire workforce. We strive to ensure that each employee feels respected and is valued based upon their skills, performance and commitment.
Every employee of Pho has the duty to always observe and apply the company policy, any violation of the policy would be treated as a serious offence and could result in disciplinary action and/or dismissal.
Engagement with employees
Pho engages with employees in several ways, the Directors of the company regularly conduct site visits with meetings taking place within the restaurants. The company encourages open dialogue though regular appraisals and internal communication tools including a mobile phone application that enables fast and convenient communication with all employees regarding news updates, staff training opportunities and personal welfare matters, employees at all levels are encouraged to participate in communication. We run annual employee engagement surveys, alongside more ad hoc ‘pulse’ style surveys through our employee communication app..

Page 3

 
PHO TRADING LIMITED
 
Section 172 Statement
 
All decisions made by the management of the Group seek to enhance the long-term reputation of the business and the brand to drive benefits to each stakeholder. By engaging openly and transparently with all stakeholders we can ensure we have comprehensively considered all the beneficiaries of the work we undertake both now and in the future. 

The Directors are aware of their duty under section 172 of the Companies Act 2006, to act in a way which they consider, in good faith, would be most likely to promote the success of the company for the benefit of its members as a whole and in doing so, have regard (amongst other matters) to: 

The consequences of any decision in the long term.
The interest of the company’s employees.
The need to foster the company’s business relationships with suppliers, customers and others.
The impact of the company’s operations on the community and the environment.
The desirability of the company maintaining a reputation for high standards of business conduct; and
The need to act fairly as between members.

Long term impact

The Directors hold regular meetings with key stakeholders of the business to provide updates on key KPI’s and additional detailed narrative supporting the company position.

Employees

All our employees throughout the business are key to our success, and we need to reward, protect and l       isten at all levels. To drive enhanced employee wellbeing we have introduced a number of health focused benefits, including discounted gym memberships, an employee assistance program and a private GP helpline and an employee wellbeing assistance program which is available to all employees from the first day of employment.

We also engage with all team members through regular appraisals and news updates communicated though the employee app.

Customers

We continuously look for ways to improve our offering, service and overall brand experience so we look to            engage with our guests through the use of onsite tablets as well as directing guests to Google reviews. There is   also a post visit email set up in the event a guest has not given us real time feedback in our sites. 

We respond to customer feedback through multiple channels and see an increase in enquiries and feedback now coming through social channels.

The Group actively seeks to adapt to the needs of its customers through regular review and development of its menu.

We aim to provide a premium dining experience, consistent across all locations. Site managers actively engage with customers, and this includes the use of onsite tablets allowing customer feedback surveys to be completed in real time.

We respond to customer feedback through multiple channels.

The Group actively seeks to adapt to the needs of its customers through regular review and development of its menu.

Suppliers

The company values the freshness and quality of restaurant supplies in contributing to maintaining the high-quality output expected form the customer base and as such recognize that building long term relationships
Page 4

 
PHO TRADING LIMITED
 
with our suppliers is mutually beneficial for our shared success. We hold long-term relationships with key suppliers allowing for focus on quality, consistency and price stability.

Community & Environment

Careful considerations are made on each restaurant location and recruitment is focused on hiring from the local community allowing for reduced travel environmental impact and increased ties within the communities we are located within.

There is a continued strong focus on environmental operating procedures including being mindful of energy usage and reduction in waste products.

We are signed up in every location to Chop Value - an organisation which takes our used chopsticks and recycles them into office furniture and other items.  

We continue to support each site with local ad hoc community requests of support including prizes for raffles for schools, grassroot football kits in the year.

In all our locations we recycle our cooking oil which is then turned into energy.

Business conduct

Customer feedback is continually reviewed, and this has been implemented into restaurant PDQ machines for customer ease, management have active engagement with customers on comments provided to ensure high standards are maintained.

Acting fairly between stakeholders 

We maintain an open dialogue with our stakeholders and other interested parties.

Corporate social responsibly

We have supported the Christina Noble Children's Foundation (CNCF) since 2021 by providing a donation from every Pho House (soup) and coffee sold  . CNCF is a charity that supports children in Vietnam by providing crucial, grassroots humanitarian services to affected communities. In FY24 the company raised £46k   in support of the charity.

As a Group we’ve always celebrated and supported our internal LGBTQ+ community to promote diversity in our business. We support activities and events surrounding PRIDE each year, and in 2019 we introduced a national, year-round support plan whereby we donate a proportion of every “Pride Punch” cocktail sold directly to national PRIDE organisations. In FY24 we raised £18k in support of Pride through this channel. We recognise the difficulty that the homeless face and support the Helping the Homeless charity which aims to secure accommodation and find work for the homeless.
Page 5

 
PHO TRADING LIMITED
 
Greenhouse Gas emissions and energy consumption   
The total consumption (kWh) figures for reportable energy supplies are as follows:

Utility and Scope

2023/24 Consumption (kWh)
2022/23 Consumption (kWh)
Grid-Supplied Electricity (Scope 2)

5,737,353

4,945,973
 
Gaseous and other fuels (Scope 1)

4,805,806

3,429,730
 
Total

10,543,159

8,375,703
 

The total emission (tCO2e) figures for reportable energy supplies are as follows. Conversion factors utilised in these calculations are as follows:

Utility and Scope

2023/24 Consumption (tCO2e) 
2022/23 Consumption (tCO2e)
Grid-Supplied Electricity (Scope 2)

1,188

956
 
Gaseous and other fuels (Scope 1)

879

626
 
Total

2,067

1,582
 

Energy Efficiency Improvements
As a Company we remain committed for continual improvements in our operational energy efficiency. As such, a register of energy efficiency measures has been compiled and is constantly updated with new measures as a when appropriate.
Current measures that are carried out include ensuring all new kitchen extraction systems are set up to run on inverters resulting in improved efficiency in adjusting the air flow within the system. With new sites, we ensure pot washing machines are BREEAM compliant, and the commercial taps are WRAS approved to reduce water usage. Customer toilets are also dual flush to reduce the water consumption of our restaurants. On all new restaurants we install full LED lighting throughout. As part of ongoing maintenance, we   regularly replace new lighting with upgraded LED bulbs and typically update a lighting circuit once older circuits have reached the end of life. When signs are repaired the old technology lamps are replaced with LED. We replace any refrigeration seals on our fridges and walk-in units when they become worn to ensure we maintain the correct temperatures and minimise energy use, our cleaners are also aware of the importance of continually cleaning the fridge condensers ensuring maximum efficiency is maintained.


This report was approved by the board on 23 August 2024 and signed on its behalf.


................................................
Wayne John Dejager
Director

Page 6

 
PHO TRADING LIMITED
 
 
 
DIRECTORS' REPORT
FOR THE PERIOD ENDED 25 FEBRUARY 2024

The directors present their report and the financial statements for the period ended 25 February 2024.

Directors' responsibilities statement

The directors are responsible for preparing the Strategic Report, the Directors' Report and the financial statements in accordance with applicable law and regulations.
 
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 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 for the Company's financial statements and then apply them consistently;

make judgements and accounting estimates that are reasonable and prudent;

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

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

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and to enable them to ensure that the financial statements comply with the Companies Act 2006They 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.

Results and dividends

The profit for the period, after taxation, amounted to £2,689,981 (2023 - £1,710,085).

Directors

The directors who served during the period were:

Patrick Joseph Marrinan 
Stephen Wall (resigned 7 October 2023)
Wayne John Dejager (appointed 7 March 2023)

Disclosure of information to auditors

Each of the persons who are directors at the time when this Directors' Report is approved has confirmed that:
 
so far as the director is aware, there is no relevant audit information of which the Company's auditors are unaware, and

the director has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the Company's auditors are aware of that information.



Page 7

 
PHO TRADING LIMITED
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE PERIOD ENDED 25 FEBRUARY 2024

Auditors

The auditorsHaysmacintyre LLPwill be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

This report was approved by the board on 23 August 2024 and signed on its behalf.
 





................................................
Wayne John Dejager
Director

Page 8

 
PHO TRADING LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE DIRECTORS OF PHO TRADING LIMITED
 

Opinion


We have audited the financial statements of Pho Trading Limited (the 'Company') for the period ended 25 February 2024, which comprise the Statement of Comprehensive Income, the Balance Sheet, the Statement of Changes in Equity and the related notes, including a summary of significant accounting policiesThe financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).


In our opinion the financial statements:


give a true and fair view of the state of the Company's affairs as at 25 February 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 United Kingdom, including the Financial Reporting Council's Ethical Standard and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.


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.


Page 9

 
PHO TRADING LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE DIRECTORS OF PHO TRADING LIMITED (CONTINUED)


Other information


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


We have nothing to report in this regard.


Opinion on other matters prescribed by the Companies Act 2006
 

In our opinion, based on the work undertaken in the course of the audit:


the information given in the Strategic Report and the Directors' Report for the financial period for which the financial statements are prepared is consistent with the financial statements; and
the Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.


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 Directors' Report.


We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:


adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of directors' remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.


Responsibilities of directors
 

As explained more fully in the Directors' Responsibilities Statement set out on page 7, 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 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.


Page 10

 
PHO TRADING LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE DIRECTORS OF PHO TRADING LIMITED (CONTINUED)


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.


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:

Explanation as to what extent the audit was considered capable of detecting irregularities, including fraud
Based on our understanding of the Company and industry, we identified that the principal risks of non-compliance with laws and regulations related to regulatory requirements for the Company and trade regulations 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 preparation of the financial statements such as the Companies Act 2006, income tax, payroll tax and sales tax.
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 management bias in accounting estimates. Audit procedures performed by the engagement team included:
 
- Inspecting correspondence with regulators and tax authorities
- Discussions with management including consideration of known or suspected instances of non-compliance with
  laws and regulation and fraud;
- Evaluating management’s controls designed to prevent and detect irregularities;
- Identifying and testing accounting journal entries, in particular those journal entries which exhibited the
  characteristics we had identified as possible indicators of irregularities; and
- Challenging assumptions and judgements made by management in their critical accounting estimates


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


A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditors' Report.


Page 11

 
PHO TRADING LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE DIRECTORS OF PHO TRADING LIMITED (CONTINUED)


Use of our report
 

This report is made solely to the Company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in an Auditors' Report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company's members, as a body, for our audit work, for this report, or for the opinions we have formed.





Andrew Ball (Senior Statutory Auditor)
for and on behalf of
Haysmacintyre LLP
Statutory Auditors
10 Queen Street Place
London
EC4R 1AG

23 August 2024
Page 12

 
PHO TRADING LIMITED
 
 
STATEMENT OF COMPREHENSIVE INCOME
FOR THE PERIOD ENDED 25 FEBRUARY 2024

53 weeks to
25 February
52 weeks to
19 February
2024
2023
Note
£
£

  

Turnover
 4 
71,095,349
58,322,487

Cost of sales
  
(14,781,193)
(12,683,029)

Gross profit
  
56,314,156
45,639,458

Administrative expenses
  
(52,298,133)
(42,347,074)

Exceptional items
 5 
7,189
(1,173,242)

Other operating income
 6 
-
63,974

Operating profit
 7 
4,023,212
2,183,116

Interest receivable and similar income
 11 
368,989
75,375

Interest payable and similar expenses
 12 
(778,048)
(421,101)

Profit before tax
  
3,614,153
1,837,390

Tax on profit
 13 
(924,172)
(127,305)

Profit for the financial period
  
2,689,981
1,710,085

Total comprehensive income for the period
  
2,689,981
1,710,085

There were no recognised gains and losses for 2024 or 2023 other than those included in the statement of comprehensive income.

The notes on pages 17 to 32 form part of these financial statements.

Page 13

 
PHO TRADING LIMITED
REGISTERED NUMBER: 05329479

BALANCE SHEET
AS AT 25 FEBRUARY 2024

25 February
19 February
2024
2023
Note
£
£

Fixed assets
  

Tangible assets
 15 
17,586,231
14,122,915

Investments
 16 
1
1

  
17,586,232
14,122,916

Current assets
  

Stocks
 17 
607,201
652,735

Debtors: Amounts falling due after more than one year
 18 
8,037,297
3,240,065

Debtors: Amounts falling due within one year
 18 
1,609,468
1,268,258

Cash at bank and in hand
 19 
7,651,022
9,990,617

  
17,904,988
15,151,675

Creditors: Amounts falling due within one year
 20 
(11,619,245)
(10,305,294)

Net current assets
  
 
 
6,285,743
 
 
4,846,381

Total assets less current liabilities
  
23,871,975
18,969,297

Creditors: Amounts falling due after more than one year
 21 
(18,022,073)
(11,296,671)

Provisions for liabilities
  

Deferred tax
 22 
(1,710,682)
(821,262)

Other provisions
 23 
-
(791,332)

  
 
 
(1,710,682)
 
 
(1,612,594)

Net assets
  
4,139,220
6,060,032


Capital and reserves
  

Called up share capital 
 24 
100
100

Profit and loss account
 25 
4,139,120
6,059,932

  
4,139,220
6,060,032


Page 14

 
PHO TRADING LIMITED
REGISTERED NUMBER: 05329479
    
BALANCE SHEET (CONTINUED)
AS AT 25 FEBRUARY 2024

The financial statements were approved and authorised for issue by the board and were signed on its behalf on 23 August 2024.




................................................
Wayne John Dejager
Director

The notes on pages 17 to 32 form part of these financial statements.

Page 15

 
PHO TRADING LIMITED
 

STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 25 FEBRUARY 2024


Called up share capital
Profit and loss account
Total equity

£
£
£


At 20 February 2022
100
4,349,847
4,349,947



Profit for the period
-
1,710,085
1,710,085



At 19 February 2023
100
6,059,932
6,060,032



Profit for the period
-
2,689,981
2,689,981

Dividends paid
-
(4,610,793)
(4,610,793)


At 25 February 2024
100
4,139,120
4,139,220


The notes on pages 17 to 32 form part of these financial statements.

Page 16

 
PHO TRADING LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 25 FEBRUARY 2024

1.


General information

Pho Trading Limited operates as a trading entity within the Licensed Restaurants sector. It is a Company registered in the UK (05329479) at 15 Clerkenwell Green, London, EC1R 0DP and is a wholly owned subsidiary of Pho Holdings Limited. 

2.Accounting policies

 
2.1

Basis of preparation of financial statements

The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.

The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgement in applying the Company's accounting policies (see note 3).

The company is exempt by virtue of section 400 of the Companies Act 2006 from the requirement to prepare group financial statements. These financial statements present information about the Company as an individual undertaking and not about its group. 
The Company's ultimate parent undertaking, Cilantro Holding Limited, includes the Company in its consolidated financial statements. The consolidated financial statements of Cilantro Holding Limited are prepared in accordance with FRS 102 and are available to the public and may be obtained from 15 Clerkenwell Green, London, EC1R 0DP. In these financial statements, the company is considered to be a qualifying entity (for the purposes of this FRS) and has applied the exemptions available under FRS 102 in respect of the following disclosures:
- Cash flow statement and related notes; and
- Key Management Personnel compensation

The following principal accounting policies have been applied:

 
2.2

Going concern

The cash flow forecast for the next 12 months is regularly updated and reviewed by the Directors and is sensitised to account for differing scenarios 
 
The Group successfully secured new investment in April 2023. This has provided the Group with new and extended financing facilities which will be in place until August 2028. On all cash flow scenarios, the Directors believe there is sufficient resources in the group for the next 12 months to comply with all covenants relating to minimum cash balance, debt leverage, debt service cover and cash headroom covenants.
 
For these reasons, the Directors continue to adopt the going concern basis in preparing the financial statements.

 
2.3

Turnover

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable for the sale of food and beverage items, excluding, value added tax and other sales taxes. 

Page 17

 
PHO TRADING LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 25 FEBRUARY 2024

2.Accounting policies (continued)

 
2.4

Operating leases: the Company as lessee

Rentals paid under operating leases are charged to profit or loss on a straight-line basis over the lease term.

Benefits received and receivable as an incentive to sign an operating lease are recognised on a straight-line basis over the lease term, unless another systematic basis is representative of the time pattern of the lessee's benefit from the use of the leased asset.

 
2.5

Government grants

Grants are accounted under the accruals model as permitted by FRS 102.
The revenue based grants received in the current year were in relation to the Retail, Hospitality and Leisure Grant Fund and they have been recognised as Other Income in the Statement of Comprehensive Income. In the prior year the Company also received grants in relation to the Coronavirus Job Retention Scheme (CJRS) which were recognised in the same way. 

 
2.6

Interest income

Interest income is recognised in profit or loss using the effective interest method.

 
2.7

Finance costs

Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.

 
2.8

Pensions

Defined contribution pension plan

The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations.

The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Balance Sheet. The assets of the plan are held separately from the Company in independently administered funds.

Page 18

 
PHO TRADING LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 25 FEBRUARY 2024

2.Accounting policies (continued)

 
2.9

Current and deferred taxation

The tax expense for the period comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.

The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the balance sheet date in the countries where the Company operates and generates income.

Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the balance sheet date, except that:
The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and
Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.

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

 
2.10

Exceptional items

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

 
2.11

Tangible fixed assets

Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

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

Depreciation is provided on the following basis:

Land and buildings leasehold
-
over the period of the lease
Plant and machinery
-
between 3 -5 years

The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.

Page 19

 
PHO TRADING LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 25 FEBRUARY 2024

2.Accounting policies (continued)

  
2.12

Stock

Stock is stated at the lower of cost and net realisable value and is measured using weekly manual stock counts within the restaurants, cross referenced back to recent invoiced prices.

 
2.13

Impairment of fixed assets and goodwill

Assets that are subject to depreciation or amortisation are assessed at each balance sheet date to determine whether there is any indication that the assets are impaired. Where there is any indication that an asset may be impaired, the carrying value of the asset (or cash-generating unit to which the asset has been allocated) is tested for impairment. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset's (or CGU's) fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (CGUs). Non-financial assets that have been previously impaired are reviewed at each balance sheet date to assess whether there is any indication that the impairment losses recognised in prior periods may no longer exist or may have decreased.

 
2.14

Valuation of investments

Investments in subsidiaries are measured at cost less accumulated impairment.

 
2.15

Debtors

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

 
2.16

Cash

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours.

 
2.17

Creditors

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

 
2.18

Provisions for liabilities

Provisions are recognised when an event has taken place that gives rise to a legal or constructive obligation, a transfer of economic benefits is probable and a reliable estimate can be made.
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.
 
Increases in provisions are generally charged as an expense to profit or loss.

 
2.19

Onerous leases

Where the unavoidable costs of a lease exceed the economic benefit expected to be received from it, a provision is made for the present value of the obligations under the lease.

Page 20

 
PHO TRADING LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 25 FEBRUARY 2024

2.Accounting policies (continued)

 
2.20

Financial instruments

The Company only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in ordinary shares.
Debt instruments (other than those wholly repayable or receivable within one year), including loans and other accounts receivable and payable, are initially measured at present value of the future cash flows and subsequently at amortised cost using the effective interest method. Debt instruments that are payable or receivable within one year, typically trade debtors and creditors, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received. However, if the arrangements of a short-term instrument constitute a financing transaction, like the payment of a trade debt deferred beyond normal business terms or in case of an out-right short-term loan that is not at market rate, the financial asset or liability is measured, initially at the present value of future cash flows discounted at a market rate of interest for a similar debt instrument and subsequently at amortised cost, unless it qualifies as a loan from a director in the case of a small Company, or a public benefit entity concessionary loan.
Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the Statement of Comprehensive Income.
For financial assets measured at cost less impairment, the impairment loss is measured as the difference between an asset's carrying amount and best estimate of the recoverable amount, which is an approximation of the amount that the Company would receive for the asset if it were to be sold at the balance sheet date.
Financial assets and liabilities are offset and the net amount reported in the Balance Sheet when there is an enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

 
2.21

Dividends

Equity dividends are recognised when they become legally payable. Interim equity dividends are recognised when paid. Final equity dividends are recognised when approved by the shareholders at an annual general meeting.

Page 21

 
PHO TRADING LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 25 FEBRUARY 2024

3.


Judgements in applying accounting policies and key sources of estimation uncertainty

In the application of the group'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 assumptions are based on historical experience and other factors that are considered to be relevant. These 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, if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.
Useful lives of property, plant and equipment
Property, plant and equipment are depreciated over their useful lives. Useful lives are based on management's best estimates of the period that the assets generate revenue, which are periodcially reviewed for continued appropriateness.
Impairment of tangible fixed assets
In carrying out an impairment review, it has been necessary to make estimates and judgements regarding the future performance and cashflows generated by individual trading units which cannot be known with certainty. Past performance is often use as a guide in estimating future performance.
Where the circumstances surrounding a particular trading unit have changed then forecasting future trading performance becomes increasingly judgemental. As a result, the actual impairment required may differ to the charge made in the financial statements. When assessing the recoverable amount of the tangible fixed assets, the net book value of the assets at the impairment date is used a guide, taking into account factors which may signficantly affect the sale or use value.
Recoverability of intercompany and related party debtors
Intercompany balances receivable are reviewed frequently for impairment. Group financial support is provided to all entities within the Group, including those that the Company has amounts owing from. On review of the Group financial position, there are sufficient net assets to repay all intercompany debt. 
 


4.


Turnover

An analysis of turnover by class of business is as follows:


53 weeks to
25 February
52 weeks to
19 February
2024
2023
£
£

Restaurant sales
46,542,659
38,124,300

Delivery sales
24,552,690
20,198,187

71,095,349
58,322,487


All turnover arose within the United Kingdom.

Page 22

 
PHO TRADING LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 25 FEBRUARY 2024

5.


Exceptional items

53 weeks to
25 February
52 weeks to
19 February
2024
2023
£
£


Other exceptional items
431,644
161,929

Management fee to Pho Holding Limited
35,000
35,000

Management fee to Pho 2012 Limited
100,000
100,000

Impairment of tangible fixed assets
-
433,981

Reversal of prior period impairment charge
-
(349,000)

Onerous lease provision (release)/charge
(573,833)
791,332

(7,189)
1,173,242


6.


Other operating income

53 weeks to
25 February
52 weeks to
19 February
2024
2023
£
£

Other operating income
-
3,074

Government grants receivable
-
60,900

-
63,974


The Company was awarded multiple government grants under the Retail, Hospitality and Leisure Grant Fund totaling £Nil (2023: £60,900).

7.


Operating profit

The operating profit is stated after charging:

53 weeks to
25 February
52 weeks to
19 February
2024
2023
£
£

Tangible fixed assets - depreciation
2,127,610
1,803,953

Other operating lease rentals
4,344,775
3,884,054

Exceptional items
(7,189)
1,173,242

See note 5 for a breakdown of Exceptional items.

Page 23

 
PHO TRADING LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 25 FEBRUARY 2024

8.


Auditors' remuneration

During the period, the Company obtained the following services from the Company's auditors:


53 weeks to
25 February
52 weeks to
19 February
2024
2023
£
£

Fees payable to the Company's auditors for the audit of the Company's financial statements
30,800
28,800

The Company has taken advantage of the exemption not to disclose amounts paid for non-audit services as these are disclosed in the consolidated accounts of the parent Company.


9.


Employees

Staff costs were as follows:


53 weeks to
25 February
52 weeks to
19 February
2024
2023
£
£

Wages and salaries
25,847,751
20,993,465

Social security costs
301,555
242,837

Cost of defined contribution scheme
378,228
295,156

26,527,534
21,531,458


The average monthly number of employees, including the directors, during the period was as follows:


     53 weeks to
     25 February
      52 weeks to
      19 February
        2024
        2023
            No.
            No.







Management and administration
207
188



Restaurant staff
880
728

1,087
916

Page 24

 
PHO TRADING LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 25 FEBRUARY 2024

10.

Directors Remuneration

The directors aggregate emoluments in respect of qualifying services were:

53 weeks to 25 February 2024
52 weeks to 19 February 2023
        £
        £
Emoluments receivable

625,977

504,640
 
Company pension contribution to purchase schemes

4,102

5,116
 

630,079

509,756
 
Emoluments of highest paid director

Emoluments including pension contributions

258,796

188,697
 

258,796

188,697
 


11.


Interest receivable

53 weeks to
25 February
52 weeks to
19 February
2024
2023
£
£


Interest receivable from group companies
368,989
37,774

Other interest receivable
-
37,601

368,989
75,375


12.


Interest payable and similar expenses

53 weeks to
25 February
52 weeks to
19 February
2024
2023
£
£


Interest on Loans from group undertakings
778,048
421,101

Page 25

 
PHO TRADING LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 25 FEBRUARY 2024

13.


Taxation


53 weeks to
25 February
52 weeks to
19 February
2024
2023
£
£

Corporation tax


Current tax on profits for the year
34,752
127,305

Deferred tax


Fixed asset timing differences
889,420
-

Tax on profit
 
924,172
 
127,305

Factors affecting tax charge for the period

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

53 weeks to
25 February
52 weeks to
19 February
2024
2023
£
£


Profit on ordinary activities before tax
3,614,153
1,837,391


Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 24.35% (2023 - 19%)
880,158
349,104

Effects of:


Non-tax deductible expenses
306,004
95,266

Group relief claimed
(768,666)
(364,856)

Income not taxable for tax purposes
(5,656)
(7,352)

Adjustments to previous periods
(212,625)
(30,545)

Remeasurement to tax charge in respect of previous periods
7,759
31,339

Other permanent differences
(3,474)
(2,398)

Tax credits
279
-

Deferred tax not recognised
589,584
(40,255)

Fixed asset differences
130,809
97,002

Total tax charge for the period
924,172
127,305


Factors that may affect future tax charges

Page 26

 
PHO TRADING LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 25 FEBRUARY 2024
 
13.Taxation (continued)

In March 2021, it was announced that the UK corporation tax rate would increase to 25% in April 2023. This announcement constitutes a substantive enactment and therefore deferred taxes at the balance sheet date are measured at the expected tax rate of 25%.


14.


Dividends

25 February
19 February
2024
2023
£
£


Dividends paid
4,610,793
-

4,610,793
-


15.


Tangible fixed assets







Leasehold property
Plant and machinery
Total

£
£
£



Cost


At 20 February 2023
19,937,084
7,791,426
27,728,510


Additions
4,465,676
1,588,828
6,054,504


Disposals
(691,285)
(177,655)
(868,940)



At 25 February 2024

23,711,475
9,202,599
32,914,074



Depreciation


At 20 February 2023
7,798,148
5,807,447
13,605,595


Charge for the year
1,468,363
821,798
2,290,161


Disposals
(394,700)
(173,213)
(567,913)



At 25 February 2024

8,871,811
6,456,032
15,327,843



Net book value



At 25 February 2024
14,839,664
2,746,567
17,586,231



At 19 February 2023
12,138,936
1,983,979
14,122,915

Page 27

 
PHO TRADING LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 25 FEBRUARY 2024

16.


Fixed asset investments








Investments in subsidiary companies

£



Cost 


At 19 February 2023
1



At 25 February 2024
1





Subsidiary undertaking


The following was a subsidiary undertaking of the Company:

Name

Registered office

Class of shares

Holding

Pho (Edinburgh) Limited
15 Clerkenwell Green, London, EC1R 0DP
Ordinary
100%

The aggregate of the share capital and reserves as at 25 February 2024 and the profit or loss for the period ended on that date for the subsidiary undertaking was as follows:

Name
Profit/(Loss)

Pho (Edinburgh) Limited
(77,089)


17.


Stocks

25 February
19 February
2024
2023
£
£

Raw materials and consumables
607,201
652,735


Page 28

 
PHO TRADING LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 25 FEBRUARY 2024

18.


Debtors

25 February
19 February
2024
2023
£
£

Due after more than one year

Amounts owed by group undertakings
8,037,297
3,240,065


Amounts owed by group undertakings are subject to interest at 5% per annum on the balance at year end and are repayable in full in December 2026.

25 February
19 February
2024
2023
£
£

Due within one year

Trade debtors
80,436
-

Other debtors
493,200
339,788

Prepayments and accrued income
795,518
928,470

Tax recoverable
240,314
-

1,609,468
1,268,258



19.


Cash

25 February
19 February
2024
2023
£
£

Cash at bank and in hand
7,651,022
9,990,617


Page 29

 
PHO TRADING LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 25 FEBRUARY 2024

20.


Creditors: Amounts falling due within one year

25 February
19 February
2024
2023
£
£

Trade creditors
3,457,330
3,498,858

Amounts owed to group undertakings
-
363,737

Corporation tax
-
575,084

Other taxation and social security
2,255,914
1,878,705

Other creditors
1,129,483
532,290

Accruals and deferred income
4,776,518
3,456,620

11,619,245
10,305,294


The amounts owed by group undertakings stated above are subject to interest at 5% per annum on the balance at year end and are repayable in full in December 2026.


21.


Creditors: Amounts falling due after more than one year

25 February
19 February
2024
2023
£
£

Amounts owed to group undertakings
18,022,073
11,296,671


The amounts owed by group undertakings stated above are subject to interest at 5% per annum on the balance at year end and are repayable in full on 31 December 2026.


22.


Deferred taxation






2024


£



At beginning of year
(821,262)


Charged to profit or loss
(889,420)



At end of year
(1,710,682)

Page 30

 
PHO TRADING LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 25 FEBRUARY 2024
 
22.Deferred taxation (continued)

The provision for deferred taxation is made up as follows:

25 February
19 February
2024
2023
£
£


Accelerated capital allowances
1,710,682
821,262


23.


Provisions






Onerous lease provision

£





At 20 February 2023
791,332


Settled in period
(217,499)


Released in period
(573,833)



At 25 February 2024
-

Page 31

 
PHO TRADING LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 25 FEBRUARY 2024

24.


Share capital

25 February
19 February
2024
2023
£
£
Authorised, allotted, called up and fully paid



100 (2023 - 100) Called up share capital shares of £1.00 each
100
100



25.


Reserves

Profit and loss account

Includes all profits and losses accumulated in the current and previous periods.


26.


Pension commitments

The Company operates a defined contributions pension scheme for all employees within the Company. The assets of the scheme are held separately from those of the Group in an independently administered fund. Contributions totalling £378,228 (2023: £295,156) were payable to the fund at the reporting date.


27.


Commitments under operating leases

At 25 February 2024 the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:

25 February
19 February
2024
2023
£
£


Not later than 1 year
4,781,365
3,884,054

Later than 1 year and not later than 5 years
12,612,423
10,521,154

Later than 5 years
29,423,250
25,233,038

46,817,038
39,638,246


28.


Controlling party

The Company is a subsidiary undertaking of Pho Holdings Limited. 
The smallest and largest group in which the results of the Company are consolidated is that headed by Cilantro Holding Limited, the ultimate controlling party, incorporated in England and Wales. No other group financial statements include the results of the Company. The consolidated financial statements of this group are available to the public and may be obtained from 15 Clerkenwell Green, London, EC1R 0DP.

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