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Registered number: 08696124










THE GERMAN GYMNASIUM LIMITED










ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 SEPTEMBER 2023

 
THE GERMAN GYMNASIUM LIMITED
 
 
COMPANY INFORMATION


Directors
D M Loewi 
G E Cox 
M A Welden 




Registered number
08696124



Registered office
16-18 Kirby Street

London

EC1N 8TS




Independent auditors
Sumer Auditco Limited
Chartered Accountants & Statutory Auditors

14th Floor

33 Cavendish Square

London

W1G 0PW





 
THE GERMAN GYMNASIUM LIMITED
 

CONTENTS



Page
Strategic report
1 - 2
Directors' report
3 - 4
Independent auditors' report
5 - 9
Statement of comprehensive income
10
Balance sheet
11
Statement of changes in equity
12
Statement of cash flows
13
Analysis of net debt
14
Notes to the financial statements
15 - 27

 
THE GERMAN GYMNASIUM LIMITED
 
 
STRATEGIC REPORT
FOR THE YEAR ENDED 30 SEPTEMBER 2023

Introduction
 
The Directors of the Company present their strategic report together with the audited financial statements for the year ended 30 September 2023.

Business review
 
The year continued to be a transitional period with the Company performing strongly, however interrupted by train strikes and poor unseasonal weather. Various initiative have been developed by the business to drive sales and strengthen performance in the challenging economic conditions.
The directors consider the results for the period to be satisfactory in light of challenging market conditions.
The directors consider Turnover as the key performance indicators for the Company. Turnover fell to £9,048,413 in 2023 from £9,195,872 in 2022. 

Principal risks and uncertainties
 
The principal risks and uncertainties arising from both internal and external factors that could impact the Company’s performance and the related mitigating activities to manage that risk are considered further on. The Company has risk management processes to identify, monitor and evaluate such issues as they emerge enabling the Board to take appropriate action where possible. The factors listed below should be considered in connection with any forward- looking statements in this report. These forward-looking statements reflect the Board’s current expectations concerning future events and actual results may differ from these expectations.
Economic and market risk
The Company, like the wider hospitality sector, is subject to risk around continued impact of train strikes, political uncertainty around Eastern Europe and the Middle East and the subsequent knock-on effects to supply chain costs that these bring. There are specific pressures around utility and labour costs.
The Company is committed to maintaining a highly desirable customer experience. The D&D brand is synonymous with style and exclusivity. Internal processes ensure that the Company is well positioned to react to market pressures while continuing to deliver a high-quality product at competitive prices to its customers.
Operational efficiency and cost control
The Company faces growing internal and external cost pressures. These pressures are managed with a focus on improving supply chain management, operational efficiency, and rigorous cost control and by utilising the wider groups size and scale. The Company is constantly looking to implement new initiatives to improve efficiency across the whole business, resulting in lower operating costs without compromising product quality or service levels. This helps support the business’s competitiveness and profitability.
Liquidity, financing and treasury
Key to the financial success of the business is the availability of sufficient bank facilities to permit the Company to meet its obligations and to enable it to continue to fund its growth through investment in new restaurants and in improving its existing venues.
To manage liquidity risk, the group has recently extended its banking facilities to the end of September 2027 as explained below under post balance sheet events.


 
Page 1

 
THE GERMAN GYMNASIUM LIMITED
 

STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023

Major operational risk
In common with other businesses the Company depends on its process and control framework to mitigate the possibility of a major failure in operations, information technology, finance, human resources or other key business processes capable of having an impact on its performance. These failures may be caused by internal factors such as a major information technology systems failure, a supply chain breakdown or failure to retain key personnel. They could also be driven by external events such as disruptions or other adverse events affecting our relationship with or the performance of major suppliers, financial services providers, designers or concessionaires, terrorism or natural disasters and other major events which impact the Company as well as the communities it serves. The Company is committed to developing and strengthening its coordinated risk management and assurance mechanisms to manage these risks in a manner which it believes ensure an appropriate and effective control framework for its businesses at a local, national and corporate level.
Major health and safety and environmental risks
The Company takes its responsibilities in the field of health, safety and the environment very seriously and fully recognises the potential human, reputational and financial consequences of these risks. The business has dedicated teams addressing these risks and follows relevant policies and procedures. During the year the Company continued to take extensive steps to create safe environments for its customers and employees. This involved investment in both training of employees and the physical set up of sites.

Future developments
 
The business saw strong sales as it finished 2023. 2024 has seen further strategic development of the brand and technology, under new investors with a focus on driving revenue and improving efficiencies to offset inflationary pressures. This is resulting in sustained EBITDA.
The Company’s strategy is to continue to develop its core restaurant brand through targeted investment and guest experiences. Following the post year end investment by Breal Capital and Calveton in the group, the business has been able to continue this development and is now looking forward to the next phase of growth.


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



G E Cox
Director
Date: 29 November 2024
Page 2

 
THE GERMAN GYMNASIUM LIMITED
 
 
 
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 SEPTEMBER 2023

The directors present their report and the financial statements for the year ended 30 September 2023.

Principal activity

The principal activity of the Company is the operation of the restaurant The German Gymnasium in London.

Directors

The directors who served during the year were:

D M Loewi
 
G E Cox and M A Welden were appointed after the year end, on 17 October 2023 

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;

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.

Qualifying third party indemnity provisions

The Company has made qualifying third-party indemnity provisions for the benefit of its directors which were made during the year and remain in force at the date of this report. 

Matters covered in the Strategic report

The directors have chosen to disclose information on financial risk management and policies, required by the Companies Act 2006, to be included in the Director's report, within the Strategic Report.

Page 3

 
THE GERMAN GYMNASIUM LIMITED
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 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.

Post balance sheet events

On 17 October 2023 CGL Restaurant Holdings Limited and its subsidiaries was acquired by a newly formed investor vehicle, Bresand Leisure Limited as part of a prepacked arrangement. The former ultimate owner, Panther Partners Limited was placed into administration There has been no impact upon trade creditors or employees as part of the transaction. As part of the transaction senior debt held by the former group was refinanced with the term date extended until September 2027 and with cash interest payments until 31 March 2025 deferred. Additional investment was also put in via new secured investor loan notes for the amount of £9.2m. The new structure and financing arrangements have allowed the group to focus on growing the business, maximising operational effectiveness, rationalising the cost base of the group, including closing sites which are not offering a meaningful return, and making the most of opportunities as they arise.

Auditors

During the year, BDO LLP resigned as auditor and Sumer Auditco Limited was appointed by the directors. Sumer Auditco Limited will be proposed for reappointment in accordance with section 485 of the Companies Act
2006.

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





G E Cox
Director
Date: 29 November 2024
Page 4

 
THE GERMAN GYMNASIUM LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF THE GERMAN GYMNASIUM LIMITED
 

Opinion


We have audited the financial statements of The German Gymnasium Limited (the 'Company') for the year ended 30 September 2023, which comprise the Statement of comprehensive income, the Balance sheet, the Statement of cash flows, 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 30 September 2023 and of its loss for the year 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 5

 
THE GERMAN GYMNASIUM LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF THE GERMAN GYMNASIUM 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 year for which the financial statements are prepared is consistent with the financial statements; and
the Strategic report and the Directors' report have been prepared in accordance with applicable legal requirements.


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 3, 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 6

 
THE GERMAN GYMNASIUM LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF THE GERMAN GYMNASIUM 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:
 
In order to identify and assess the risks of material misstatements, including fraud and non-compliance with laws and regulations that could be expected to have a material impact on the financial statements, we have
considered: 
 
the results of our enquiries of management and those charged with government of their assessment of the risks of fraud and irregularities;
the nature of the Company, including its management structure and control systems (including the opportunity for management to override controls);
management's incentives and opportunities for fraudulent manipulation of the financial statements; and
the industry and environment in which it operates.
 
We also considered UK tax and pension legislation and laws and regulations relating to employment and the preparation and presentation of the financial statements such as the Companies Act 2006.
Based on this understanding we identified the following matters as being of significance to the entity:
 
laws and regulations considered to have a direct effect on the financial statements including UK financial reporting standards, Company Law, tax and pension legislation and distributable profits legislation;
the timing of the recognition of commercial income;
compliance with legislation relating to Health & Safety and Food Safety;
management bias in selecting accounting policies and determining estimates;
inappropriate journal entries;
correct statement of staff costs;
misstatement of creditors;
recoverability of debtors; and
carrying value of fixed assets.

We communicated the outcomes of these discussions and enquiries, as well as consideration as to where and how fraud may occur in the entity, to all engagement team members.
 
Page 7

 
THE GERMAN GYMNASIUM LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF THE GERMAN GYMNASIUM LIMITED (CONTINUED)


Audit procedures were undertaken in response to the potential risks relating to irregularities (which include fraud and non-compliance with laws and regulations) comprised:
 
enquiries of management and those charged with governance as to whether the entity complies with such laws and regulations;
enquiries with the same concerning any actual or potential litigation claims;
discussion with the same regarding any known or suspected non-compliance with laws and regulation and fraud;
inspection of relevant legal correspondence;
obtaining an understanding of the relevant controls during the period;
obtaining an understanding of the policies and controls over the recognition of income and testing their implementation during the year;
identifying and testing journal entries, in particular any journal entries posted with unusual account combinations;
assessing the recovery of debtors in the period since the balance sheet date and challenging assumptions made by management regarding the recovery of balances which remain outstanding;
confirming the validity of significant liabilities;
reviewing the financial statements for compliance with the relevant disclosure requirements;
performing analytical procedures to identify any unusual or unexpected relationships or unexpected movements in account balances which may be indicative of fraud; 
evaluating the underlying business reasons for any unusual transactions;
review of documentation relating to compliance with regulations on health & safety and food safety and certificates held;
challenging assumptions made by management in the specific accounting policies and estimates , in particular in relation to supplier rebates accruals and depreciation;
reviewing minutes of board meetings and correspondence with HMRC;
physical inspection of assets including leasehold premises to verify condition of the property and existence of assets recorded in use; and
review of lease agreements including lease incentives to ensure accurate accounting of related charges and liabilties.

No instances of material non-compliance were identified. However, the likelihood of detecting irregularities, including fraud, is limited by the inherent difficulty in detecting irregularities, the effectiveness of the entity's controls, and the nature, timing and extent of the audit procedures performed. Irregularities that result from
fraud might be inherently more difficult to detect than irregularities that result from error. As explained above, there is an unavoidable risk that material misstatements may not be detected, even though the audit has been planned and performed in accordance with ISAs (UK).


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 8

 
THE GERMAN GYMNASIUM LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF THE GERMAN GYMNASIUM 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.





Daryush Farshchi-Heidari FCA (Senior statutory auditor)
for and on behalf of
Sumer Auditco Limited
Chartered Accountants
Statutory Auditors
14th Floor
33 Cavendish Square
London
W1G 0PW

29 November 2024
Page 9

 
THE GERMAN GYMNASIUM LIMITED
 
 
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 SEPTEMBER 2023

2023
2022
Note
£
£

  

Turnover
 4 
9,048,413
9,195,872

Cost of sales
  
(7,693,046)
(7,053,828)

Gross profit
  
1,355,367
2,142,044

Administrative expenses
  
(434,528)
(476,679)

Exceptional administrative expenses
 5 
(6,896,734)
-

Operating (loss)/profit
 6 
(5,975,895)
1,665,365

Tax on (loss)/profit
 8 
115,706
(312,785)

(Loss)/profit for the financial year
  
(5,860,189)
1,352,580

There was no other comprehensive income for 2023 (2022:£NIL).

The notes on pages 15 to 27 form part of these financial statements.
Page 10

 
THE GERMAN GYMNASIUM LIMITED
REGISTERED NUMBER: 08696124

BALANCE SHEET
AS AT 30 SEPTEMBER 2023

2023
2022
Note
£
£

Fixed assets
  

Tangible assets
 9 
2,947,398
3,156,588

  
2,947,398
3,156,588

Current assets
  

Stocks
 10 
187,047
265,654

Debtors: amounts falling due within one year
 11 
729,057
717,513

Cash at bank and in hand
 12 
1,897
6,940,361

  
918,001
7,923,528

Creditors: amounts falling due within one year
 13 
(3,992,451)
(5,231,273)

Net current (liabilities)/assets
  
 
 
(3,074,450)
 
 
2,692,255

Total assets less current liabilities
  
(127,052)
5,848,843

Provisions for liabilities
  

Deferred tax
 14 
(209,306)
(325,012)

  
 
 
(209,306)
 
 
(325,012)

Net (liabilities)/assets
  
(336,358)
5,523,831


Capital and reserves
  

Called up share capital 
 15 
1
1

Profit and loss account
 16 
(336,359)
5,523,830

  
(336,358)
5,523,831


The financial statements were approved and authorised for issue by the board and were signed on its behalf by: 




G E Cox
Director

Date: 29 November 2024

The notes on pages 15 to 27 form part of these financial statements.
Page 11

 
THE GERMAN GYMNASIUM LIMITED
 

STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 SEPTEMBER 2023


Called up share capital
Profit and loss account
Total equity

£
£
£


At 1 October 2021
1
4,171,250
4,171,251



Profit for the year
-
1,352,580
1,352,580



At 1 October 2022
1
5,523,830
5,523,831



Loss for the year
-
(5,860,189)
(5,860,189)


At 30 September 2023
1
(336,359)
(336,358)


The notes on pages 15 to 27 form part of these financial statements.
Page 12

 
THE GERMAN GYMNASIUM LIMITED
 

STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 SEPTEMBER 2023

2023
2022
£
£

Cash flows from operating activities

(Loss)/profit for the financial year
(5,975,895)
1,665,365

Adjustments for:

Depreciation of tangible assets
262,401
255,640

Decrease/(increase) in stocks
78,607
(24,768)

(Increase) in debtors
(11,544)
(5,256,756)

(Decrease)/increase in creditors
(1,238,822)
5,559,452

Net cash (used in)/generated from operating activities

(6,885,253)
2,198,933


Cash flows from investing activities

Purchase of tangible fixed assets
(53,211)
(79,484)

Net cash used in investing activities

(53,211)
(79,484)


Net (decrease)/increase in cash and cash equivalents
(6,938,464)
2,119,449

Cash and cash equivalents at beginning of year
6,940,361
4,820,912

Cash and cash equivalents at the end of year
1,897
6,940,361


Cash and cash equivalents at the end of year comprise:

Cash at bank and in hand
1,897
6,940,361


The notes on pages 15 to 27 form part of these financial statements.

Page 13

 
THE GERMAN GYMNASIUM LIMITED
 

ANALYSIS OF NET DEBT
FOR THE YEAR ENDED 30 SEPTEMBER 2023




At 1 October 2022
Cash flows
At 30 September 2023
£

£

£

Cash at bank and in hand

6,940,361

(6,938,464)

1,897


The notes on pages 15 to 27 form part of these financial statements.
Page 14

 
THE GERMAN GYMNASIUM LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2023

1.


General information

The Company is a private company limited by share capital, incorporated in England and Wales. The address of the registered office is 16-18 Kirby Street, London, EC1N 8TS and the principal place of business is The German Gymnasium, 1 King's Blvd, London, N1C 4BU.

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 following principal accounting policies have been applied:

 
2.2

Going concern

The Company is party to funding arrangements covering various entities within the Bresand Leisure Limited group. The company has provided a cross-guarantee to this banking group and so is bound by the covenant requirements of the banking group as a whole. 
In assessing the going concern basis of preparation of the financial statements for the year ended 30 September 2023, the directors have taken into consideration detailed cash flow forecasts for the business within the wider banking group and the forecast compliance with bank covenants, which are set at a banking group level covering a period of at least 12 months from the date of approval of the financial statements. 
The forecasts for the banking group indicate that the group has sufficient liquidity to realise its assets and meet its liabilities as they fall due for a period of at least 12 months, and that the banking covenant (based on minimum liquidity) will be met for that period. The current trading performance of the group,  provides comfort to the directors in their forecasts. 
As part of the assessment of the going concern principal, management have considered the risks to the liquidity of the group. Except in the most extreme circumstances, the group has means available to it to manage its cashflows, such that it has sufficient liquidity to meet its covenants, realise its assets and meet its liabilities as they fall due. In only the most extreme case involving a prolonged reduction in sales, which it does not regard as reasonably likely based on the recent performance of the group, would the group require additional liquidity. Should this need arise the business has the ability within the current facility agreement to provide additional liquidity necessary, such that the covenants remain achieved. Based on discussions the Board have had with shareholders and investors of the group, they are confident any short-term funding required would be made available, however is not currently needed.
Based on the forecasts prepared the directors view the risk of default of bank facilities, and therefore inability to meet liabilities as they fall due, is not considered a reasonably likely one and so the level of uncertainty is not considered material. Given the above and the current trading performance of the group, the directors are satisfied preparing the financial statements on a going concern basis is appropriate.
 
Page 15

 
THE GERMAN GYMNASIUM LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2023

2.Accounting policies (continued)


2.2
Going concern (continued)

The Company is dependent on the continuing provision of the financial support that it has received from its parent undertaking, CGL Restaurant Holdings Limited. The parent has committed to provide continuing support for at least the next 12 months from the date of signing these financial statements, through the provision of a formal support letter signed by deed. The directors of both the company and parent undertaking have a reasonable expectation that the company and the parent undertaking will have access to adequate resources to continue in operational existence for the foreseeable future. For these reasons, they continue to adopt the going concern basis of accounting in preparing the annual financial statements.

 
2.3

Revenue

Revenue represents sales to outside customers at invoiced amounts excluding discretionary service
charge and Value Added Tax.
Revenue is recognised when the significant risks and benefits of ownership of the products have
transferred to the buyer. This will occur through the provision of restaurant services and sale of
goods, and will be upon the completion of a sale to customers.

 
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

Pensions

The Company does not operate its own pension scheme. The Company makes contributions to certain senior employees’ personal pension schemes, which are charged to the profit and loss account as they fall due. The Group operates a defined contribution scheme. The assets of the plan attributable to individuals participating in the plan are independently administered and managed by The People’s Pension. The amounts charged against profit represent the contributions payable to the scheme in respect of the accounting period. 

Page 16

 
THE GERMAN GYMNASIUM LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2023

2.Accounting policies (continued)

 
2.6

Current and deferred taxation

The tax expense for the year 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.

 
2.7

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.

 
2.8

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.



Page 17

 
THE GERMAN GYMNASIUM LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2023

2.Accounting policies (continued)


2.8
Tangible fixed assets (continued)

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:

Leasehold improvements
-
Over the shorter of the lease period and 25 years, having consideration to provisions contained in the lease for future potential lease renewals.
Plant and equipment
-
Over 4 years
Furniture, fixtures and fittings
-
Over 10 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.

Fixed assets are assessed at each reporting 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). Fixed assets that have been previously impaired are reviewed at each reporting date to assess whether there is any indication that the impairment losses recognised in prior periods may no longer exist or may have decreased where impairment losses previously recognised are not reversed.

 
2.9

Stocks

Stocks consist of raw materials and consumables, crockery, linen and staff uniforms. Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis.
At each balance sheet date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in profit or loss.

 
2.10

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.

Page 18

 
THE GERMAN GYMNASIUM LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2023

2.Accounting policies (continued)

 
2.11

Cash and cash equivalents

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

In the Statement of cash flows, cash and cash equivalents are shown net of bank overdrafts that are repayable on demand and form an integral part of the Company's cash management.

 
2.12

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.

 
2.13

Financial instruments

The Company has elected to apply the provisions of Section 11 “Basic Financial Instruments” of FRS 102 to all of its financial instruments.

Financial instruments are recognised in the Company's Balance sheet when the Company becomes party to the contractual provisions of the instrument.

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally 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.

Basic financial assets

Basic financial assets, which include trade and other receivables, cash and bank balances, are initially measured at their transaction price including transaction costs and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest.

Discounting is omitted where the effect of discounting is immaterial. The Company's cash and cash equivalents, trade and most other receivables due with the operating cycle fall into this category of financial instruments.

Impairment of financial assets

Financial assets are assessed for indicators of impairment at each reporting date. 

Financial assets are impaired when events, subsequent to their initial recognition, indicate the estimated future cash flows derived from the financial asset(s) have been adversely impacted. The impairment loss will be the difference between the current carrying amount and the present value of the future cash flows at the asset(s) original effective interest rate.

If there is a favourable change in relation to the events surrounding the impairment loss then the impairment can be reviewed for possible reversal. The reversal will not cause the current carrying amount to exceed the original carrying amount had the impairment not been recognised. The impairment reversal is recognised in the profit or loss.
 
Page 19

 
THE GERMAN GYMNASIUM LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2023

2.Accounting policies (continued)


2.13
Financial instruments (continued)


Financial liabilities

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

Basic financial liabilities, which include trade and other payables, bank loans and other loans are initially measured at their transaction price after transaction costs. When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Discounting is omitted where the effect of discounting is immaterial.

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

Trade payables are obligations to pay for goods and services that have been acquired in the ordinary course of business from suppliers. Trade payables are classified as current liabilities if the payment is due within one year. If not, they represent non-current liabilities. Trade payables are initially recognised at their transaction price and subsequently are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial.

Derecognition of financial assets

Financial assets are derecognised when their contractual right to future cash flow expire, or are settled, or when the Company transfers the asset and substantially all the risks and rewards of ownership to another party. If significant risks and rewards of ownership are retained after the transfer to another party, then the Company will continue to recognise the value of the portion of the risks and rewards retained.

Derecognition of financial liabilities

Financial liabilities are derecognised when the Company's contractual obligations expire or are discharged or cancelled.

Page 20

 
THE GERMAN GYMNASIUM LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2023

3.


Critical accounting judgements and key sources of estimation uncertainty

In the application of the Company’s accounting policies, which are described in note 2, the directors are required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised 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.
Key source of estimation uncertainty 
Impairment of fixed assets and intangible assets
Determining whether fixed assets and intangible assets are impaired requires an estimation of the value in use of the cash-generating units to which fixed assets and intangible assets have been allocated. The value in use calculation requires the entity to estimate the future cash flows expected to arise from the cash-generating unit and, and a suitable discount rate in order to calculate present value. The carrying amount of the fixed assets at the balance sheet date was £2,947,398 (2022: £3,156,588). During the year impairment of fixed assets and totalled £Nil (2022: £Nil). In concluding on the value of impairment the directors considered downside risk to their own models. 
The impairment review has been calculated based on information known at the balance sheet date updated only for facts known post year end which were in place at the balance sheet date. It does not adjust for post balance sheet information which could not reasonably be known at the balance sheet date.
Useful economic lives of assets and depreciation charges
Tangible fixed assets are depreciated over their useful lives taking into account residual values, where appropriate. The actual lives of the assets and residual values are assessed annually and may vary depending on a number of factors. In re- assessing  asset lives, factors such as the level of maintenance expenditures required to obtain the expected cashflow from the asset,  contractual provisions that may limit the useful life, the entity’s own experience in renewing or extending similar arrangements, regardless of whether those arrangements have explicit renewal or extension provisions, the effects of obsolescence, technological innovation, demand, competition and other economic factors are examined. Residual value assessments consider issues such as future market conditions, the remaining life of the asset and projected disposal values.


4.


Turnover

Turnover, attributable to continuing operations, is derived from the sale of food, wines, spirits, beverages and sundry items. The origin and end destination of all turnover was the United Kingdom.

Page 21

 
THE GERMAN GYMNASIUM LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2023

5.


Exceptional items

2023
2022
£
£


Professional fees
42,098
-

Provision against amounts due from group undertakings
6,843,333
-

Provision for stock obsolescence
11,303
-

6,896,734
-


6.


Operating (loss)/profit

The operating (loss)/profit is stated after charging:

2023
2022
£
£

Fees payable to the company’s auditor for the audit of the company’s annual financial statements
27,921
17,560

Operating lease costs - property
718,629
735,098

Depreciation
262,401
255,640


7.


Employees

Staff costs were as follows:


2023
2022
£
£

Wages and salaries
2,920,954
2,436,889

Social security costs
188,772
167,613

Cost of defined contribution scheme
44,523
37,688

3,154,249
2,642,190


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


        2023
        2022
            No.
            No.







Management and administration
10
15



Hospitality
134
96

144
111

Page 22

 
THE GERMAN GYMNASIUM LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2023

8.


Taxation


2023
2022
£
£

Corporation tax


Current tax on profits for the year
-
311,785

Adjustments in respect of previous periods
-
(10,000)


Total current tax

-
301,785

Deferred tax


Origination and reversal of timing differences
(115,706)
10,000

Changes to tax rates
-
(2,000)

Adjustments in respect of previous periods
-
3,000

Total deferred tax

(115,706)
11,000


Tax on (loss)/profit
(115,706)
312,785

Factors affecting tax charge for the year

The tax assessed for the year is higher than (2022 - lower than) the applicable rate of corporation tax in the UK of 22% (2022 - 19%). On 1 April 2023, the main rate of corporation tax where profits exceed £250,000 increased from 19% to 25% with a marginal rate applying where profits are between £50,000 and £250,000. This has resulted in a tax rate for the company over the period of 22%. The differences are explained below:

2023
2022
£
£


(Loss)/profit on ordinary activities before tax
(5,975,895)
1,665,365


(Loss)/profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 22% (2022 - 19%)
(1,314,697)
316,419

Effects of:


Fixed asset differences
57,728
5,000

Expenses not deductible for tax purposes
1,505,534
-

Group relief
(248,565)
(312,000)

Payment for group relief
-
312,000

Adjustments to tax charge in respect of prior periods
-
(10,000)

Adjustments to deferred tax charge in repect to prior periods
-
(2,000)

Tax rate changes
-
3,366

Short-term timing differences
(115,706)
-

Total tax charge for the year
(115,706)
312,785
Page 23

 
THE GERMAN GYMNASIUM LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2023
 
8.Taxation (continued)


Factors that may affect future tax charges

There were no factors that may affect future tax charges.




9.


Tangible fixed assets





Leasehold improvements
Plant and equipment
Furniture, fixtures and fittings
Total

£
£
£
£



Cost


At 1 October 2022
3,595,518
355,102
887,959
4,838,579


Additions
-
20,834
32,377
53,211



At 30 September 2023

3,595,518
375,936
920,336
4,891,790



Depreciation


At 1 October 2022
978,594
221,180
482,217
1,681,991


Charge for the year on owned assets
143,903
28,714
89,784
262,401



At 30 September 2023

1,122,497
249,894
572,001
1,944,392



Net book value



At 30 September 2023
2,473,021
126,042
348,335
2,947,398



At 30 September 2022
2,616,924
133,922
405,742
3,156,588


10.


Stocks

2023
2022
£
£

Raw materials and consumables
65,587
97,097

Crockery, linen and staff uniforms
121,460
168,557

187,047
265,654


Page 24

 
THE GERMAN GYMNASIUM LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2023

11.


Debtors

2023
2022
£
£


Trade debtors
100,938
37,668

Amounts owed by group undertakings
6,471
2,408

Other debtors
114,194
124,642

Prepayments and accrued income
507,454
552,795

729,057
717,513



12.


Cash and cash equivalents

2023
2022
£
£

Cash at bank and in hand
1,897
6,940,361



13.


Creditors: Amounts falling due within one year

2023
2022
£
£

Trade creditors
689,049
773,288

Amounts owed to group undertakings
2,216,959
3,443,465

Other taxation and social security
268,938
267,187

Other creditors
268,878
252,139

Accruals and deferred income
548,627
495,194

3,992,451
5,231,273



14.


Deferred taxation




2023


£






At beginning of year
(325,012)


Charged to profit or loss
115,706



At end of year
(209,306)

Page 25

 
THE GERMAN GYMNASIUM LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2023
 
14.Deferred taxation (continued)

The provision for deferred taxation is made up as follows:

2023
2022
£
£


Fixed asset timing differences
(56,294)
(172,000)

Capital gains/(losses)
(153,012)
(153,012)

(209,306)
(325,012)


15.


Share capital

2023
2022
£
£
Allotted, called up and fully paid



1 (2022 - 1) Ordinary share of  £ 1.00
1
1



16.


Reserves

Profit and loss account

Profit and loss account represents the cumulative profits or losses, net of dividends paid and other adjustment


17.


Contingent liabilities

The Company, together with its fellow subsidiaries, were party to an intercompany guarantee dated 11 October 2016 in favour of Santander UK Plc (as security agent for HSBC Bank Plc and Santander UK Plc) given as security for debt facilities provided to the parent undertaking and its subsidiaries. As at the balance sheet date the net amount due under these facilities was £42,304,000 (2022: £39,275,000). As per note 20 this amount has been refinanced on the 17 October 2023 and the net amount now due under the facilities is £47,775,000.

Page 26

 
THE GERMAN GYMNASIUM LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2023

18.


Commitments under operating leases

At 30 September 2023 the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:

2023
2022
£
£


Not later than 1 year
616,000
616,000

Later than 1 year and not later than 5 years
2,464,000
2,464,000

Later than 5 years
7,081,468
7,697,468

10,161,468
10,777,468


19.


Related party transactions

During the year the Company made purchase and sales to other entities in  the wider D&D London Group (all entities owned by CGL Restaurant Holdings Limited) of £555,911 (2022:£5,817,000) and £90,882 (2022: £9,000) respectively.


20.


Post balance sheet events

On 17 October 2023 CGL Restaurant Holdings Limited and its subsidiaries was acquired by a newly formed investor vehicle, Bresand Leisure Limited as part of a prepacked arrangement. The former ultimate owner, Panther Partners Limited was placed into administration There has been no impact upon trade creditors or employees as part of the transaction. As part of the transaction senior debt held by the former group was refinanced with the term date extended until September 2027 and with cash interest payments until 31 March 2025 deferred. Additional investment was also put in via new secured investor loan notes for the amount of £9.2m. The new structure and financing arrangements have allowed the group to focus on growing the business, maximising operational effectiveness, rationalising the cost base of the group, including closing sites which are not offering a meaningful return, and making the most of  opportunities as they arise.


21.


Controlling party

At the balance sheet date the ultimate parent company was Panther Partners Limited, a company incorporated in England and Wales. Subsequent to the year end there has been a group re-organisation, for further details see note 20. 

Page 27