Ellipsis Entertainment Ltd
Annual Report and Financial Statements
For the year ended 31 March 2024
Company Registration No. 10711624 (England and Wales)
Ellipsis Entertainment Ltd
Company Information
Directors
S J Hart
(Appointed 23 May 2024)
A P McGuiness
J P Scott
Company number
10711624
Registered office
Shepherd and Wedderburn LLP
Octagon Point
5 Cheapside
London
United Kingdom
EC2V 6AA
Auditor
Moore Kingston Smith LLP
Charlotte Building
17 Gresse Street
London
W1T 1QL
Ellipsis Entertainment Ltd
Contents
Page
Strategic report
1 - 2
Directors' report
3
Directors' responsibilities statement
4
Independent auditor's report
5 - 8
Group profit and loss account
9
Group statement of comprehensive income
10
Group balance sheet
11
Company balance sheet
12
Group statement of changes in equity
13
Company statement of changes in equity
14
Group statement of cash flows
15
Notes to the financial statements
16 - 38
Ellipsis Entertainment Ltd
Strategic Report
For the year ended 31 March 2024
Page 1

The directors present the strategic report for the year ended 31 March 2024.

Fair review of the business

The principal activity of the business is the development and exploitation of the Layered Reality platform.   The platform permits the combination of traditional theatrical elements such as sets and actors; with a range of digital asset delivery platforms such as virtual reality, projection mapping and binaural sound; with a sensory layer manipulating temperature, taste, touch and smell.  The combination of these layers through the platform, enables us to deliver theatrical experiences fit for the 21st Century.

 

The reported results are for the 12-month period to 31 March 2024 and are compared to our previous accounting period being the 15-months to 31 March 2023.

 

During the period, we completed the initial development phase of the Layered Reality platform culminating in HMRC recognising the business as a “Knowledge Intensive Company” for the purposes of financing the business.

 

The completion of the platform, together with the ongoing commercial and reputational performance of the existing shows has enabled us to secure new internationally renowned intellectual property, including the rights to tell Elvis Presley’s life story internationally in 2025 and beyond.

 

Revenue for the year ended 31 March 2024 was £6.7m (2023: £8.2m). Adjusting for the change in length in accounting period, there was a small increase in revenue for the period vs the prior period.  During the year, both shows were migrated to a new ticketing and promotion platform which resulted in significantly lower marketing costs increasing net profitability. Group turnover is recognised on show attendance so does not reflect the advanced sales for new shows planned for 2025, including Elvis Evolution, which has advance ticket orders and sales totalling £5m to date.  

 

The Group recorded an operating loss of £1.2m vs £1.5m in the prior period before an exception charge of £6.3m arising from the one-off impairment in the carrying value of the existing shows (a non-cash accounting adjustment), depreciation and corporate head office costs.  The impairment arises with the completion of the platform development phase of the business.

 

Principal risks and uncertainties

Market demand

The shows are largely reliant on consumer spend, and changes in the broader economic environment and demand for immersive experiences may impact attendance and spend per head.

 

Future shows

Work is currently ongoing on Elvis Evolution and an unannounced show, both expected to open in London in 2025. Funding is committed for both shows, and cash flows assume key milestones will be achieved ahead of opening.

Key performance indicators

The key measure of success in this period in the development of the Layered Reality platform is revenue.

 

Revenue for the year ended 31 March 2024 was £6.7m vs. £8.2m in 2023 as analysed above.

 

Ellipsis Entertainment Ltd
Strategic Report (Continued)
For the year ended 31 March 2024
Page 2

On behalf of the board

S J Hart
Director
24 January 2025
Ellipsis Entertainment Ltd
Directors' Report
For the year ended 31 March 2024
Page 3

The directors present their annual report and financial statements for the year ended 31 March 2024.

Principal activities

The principal activity of the company continued to be that of live immersive experiences to the public.

Directors

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

S J Hart
(Appointed 23 May 2024)
A P McGuiness
J P Scott
Results and dividends

No ordinary dividends were paid. The directors do not recommend payment of a further dividend.

Auditor

Moore Kingston Smith LLP were appointed as auditor to the group and in accordance with section 485 of the Companies Act 2006, a resolution proposing that they be re-appointed will be put at a General Meeting.

Statement of disclosure to auditor

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the auditor of the company is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the auditor of the company is aware of that information.

On behalf of the board
S J Hart
Director
24 January 2025
2025-01-24
Ellipsis Entertainment Ltd
Directors' Responsibilities Statement
For the year ended 31 March 2024
Page 4

The directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulations.

 

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the group and company, and of the profit or loss of the group for that period. In preparing these financial statements, the directors are required to:

 

 

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the group’s and company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the group and company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Ellipsis Entertainment Ltd
Independent Auditor's Report
To the Members of Ellipsis Entertainment Ltd
Page 5
Opinion

We have audited the financial statements of Ellipsis Entertainment Ltd (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 March 2024 which comprise the Group Profit And Loss Account, the Group Statement of Comprehensive Income, the Group Balance Sheet, the Company Balance Sheet, the Group Statement of Changes in Equity, the Company Statement of Changes in Equity, the Group Statement of Cash Flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

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 Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the group and parent company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Material uncertainty related to going concern

We draw attention to note 1.5 of the financial statements, which describes the basis which the company and the group continue to prepare financial statements on the going concern basis. The group is in a net liability position at the reporting date.

Cashflow forecasts prepared by the directors indicate that the company and the group will need further funding during the 12 months following the date of signature of these financial statements in order to continue to meet their liabilities as they fall due. In concluding that it remains appropriate to prepare the accounts on the going concern basis the directors have made a number of key assumptions as to the future performance of the business; the equity conversion or rescheduling of certain liabilities which are otherwise contractually due to be repaid within 12 months; the ability of the group to raise further loans and equity share capital; and the projected performance of the groups current and upcoming immersive shows over the next 12 months. These conditions, along with other matters set forth in Note 1.5, indicate that a material uncertainty exists that may cast a significant doubt on the ability of the company and group to continue as a going concern.

 

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.

 

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

Ellipsis Entertainment Ltd
Independent Auditor's Report (Continued)
To the Members of Ellipsis Entertainment Ltd
Page 6

Other information

The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

 

Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

 

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

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

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the group and the parent company and their 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:

 

Responsibilities of directors

As explained more fully in the Directors' Responsibilities Statement, 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 group's and parent 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 group or parent company or to cease operations, or have no realistic alternative but to do so.

Ellipsis Entertainment Ltd
Independent Auditor's Report (Continued)
To the Members of Ellipsis Entertainment Ltd
Page 7
Auditor's 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 auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

As part of an audit in accordance with ISAs (UK) we exercise professional judgement and maintain professional scepticism throughout the audit. We also:

 

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

 

Ellipsis Entertainment Ltd
Independent Auditor's Report (Continued)
To the Members of Ellipsis Entertainment Ltd
Page 8

Explanation as to what extent the audit was considered capable of detecting irregularities, including

fraud

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities,

including fraud is detailed below.

 

The objectives of our audit in respect of fraud, are; to identify and assess the risks of material misstatement of the financial statements due to fraud; to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud, through designing and implementing appropriate responses to those assessed risks; and to respond appropriately to instances of fraud or suspected fraud identified during the audit. However, the primary responsibility for the prevention and detection of fraud rests with both management and those charged with governance of the company.

 

Our approach was as follows:

Ÿ

 

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

Use of our report

This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken for no purpose other than to draw to the attention of the company’s members those matters we are required to include in an auditor's report addressed to them. To the fullest extent permitted by law, we do not accept or assume responsibility to any party 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.

Mark Twum-Ampofo (Senior Statutory Auditor)
for and on behalf of Moore Kingston Smith LLP
24 January 2025
Chartered Accountants
Statutory Auditor
Charlotte Building
17 Gresse Street
London
W1T 1QL
Ellipsis Entertainment Ltd
Group Profit and Loss Account
For the year ended 31 March 2024
Page 9
Year
Period
Exceptional
ended
Exceptional
ended
Continuing
items -
31 March
Continuing
items -
31 March
operations
Impairment
2024
operations
Impairment
2023
as restated
Notes
£
£
£
£
£
£
Turnover
3
6,726,775
-
6,726,775
8,169,407
-
8,169,407
Cost of sales
(3,751,395)
-
(3,751,395)
(4,024,567)
-
(4,024,567)
Gross profit
2,975,380
-
2,975,380
4,144,840
-
4,144,840
Administrative expenses
(6,389,466)
-
(6,389,466)
(7,266,289)
-
(7,266,289)
Other operating income
101,808
-
101,808
5,334
-
5,334
Operating loss
5
(3,312,278)
-
(3,312,278)
(3,116,115)
-
(3,116,115)
Interest receivable and similar income
9
1,523
-
1,523
-
-
-
Interest payable and similar expenses
10
(554,884)
-
(554,884)
(763,567)
-
(763,567)
Profit/(loss) on disposal of operations
Impairment of intangible fixed assets
-
(6,299,247)
(6,299,247)
-
-
-
Loss before taxation
(3,865,639)
(6,299,247)
(10,164,886)
(3,879,682)
-
(3,879,682)
Tax on loss
11
487,568
-
487,568
1,369,773
-
1,369,773
Loss for the financial year
(3,378,071)
(6,299,247)
(9,677,318)
(2,509,909)
-
(2,509,909)
Loss for the financial year is all attributable to the owners of the parent company.
Ellipsis Entertainment Ltd
Group Statement of Comprehensive Income
For the year ended 31 March 2024
Page 10
Year
Period
ended
ended
31 March
31 March
2024
2023
as restated
£
£
Loss for the year
(9,677,318)
(2,509,909)
Other comprehensive income
-
-
Total comprehensive income for the year
(9,677,318)
(2,509,909)
Total comprehensive income for the year is all attributable to the owners of the parent company.
Ellipsis Entertainment Ltd
Group Balance Sheet
As at 31 March 2024
Page 11
2024
2023
as restated
Notes
£
£
£
£
Fixed assets
Intangible assets
12
2,117,084
8,101,685
Tangible assets
13
64,614
88,984
2,181,698
8,190,669
Current assets
Stocks
16
82,216
181,551
Debtors
17
3,092,183
1,404,603
Cash at bank and in hand
118,117
61,410
3,292,516
1,647,564
Creditors: amounts falling due within one year
18
(7,037,763)
(5,511,517)
Net current liabilities
(3,745,247)
(3,863,953)
Total assets less current liabilities
(1,563,549)
4,326,716
Creditors: amounts falling due after more than one year
19
(2,390,184)
(2,213,069)
Net (liabilities)/assets
(3,953,733)
2,113,647
Capital and reserves
Called up share capital
26
24,749
23,087
Share premium account
14,356,847
11,418,681
Equity reserve
27
578,411
158,302
Other reserves
250,000
-
0
Profit and loss reserves
(19,163,741)
(9,486,423)
Equity attributable to owners of the parent company
(3,953,734)
2,113,647
Non-controlling interests
1
-
(3,953,733)
2,113,647
The financial statements were approved by the board of directors and authorised for issue on 24 January 2025 and are signed on its behalf by:
24 January 2025
S J Hart
Director
Ellipsis Entertainment Ltd
Company Balance Sheet
As at 31 March 2024
31 March 2024
Page 12
2024
2023
as restated
Notes
£
£
£
£
Fixed assets
Intangible assets
12
1,950,894
2,725,611
Tangible assets
13
10,797
17,677
Investments
14
101
1
1,961,792
2,743,289
Current assets
Stocks
16
55,320
160,209
Debtors
17
2,499,966
5,633,249
Cash at bank and in hand
41,205
42,760
2,596,491
5,836,218
Creditors: amounts falling due within one year
18
(5,308,714)
(3,629,739)
Net current (liabilities)/assets
(2,712,223)
2,206,479
Total assets less current liabilities
(750,431)
4,949,768
Creditors: amounts falling due after more than one year
19
(2,251,968)
(2,046,682)
Net (liabilities)/assets
(3,002,399)
2,903,086
Capital and reserves
Called up share capital
26
24,749
23,087
Share premium account
14,356,847
11,418,681
Equity reserve
27
578,411
158,302
Profit and loss reserves
(17,962,406)
(8,696,984)
Total equity
(3,002,399)
2,903,086

As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s loss for the year was £9,265,422 (2023 - £1,257,384 loss).

The financial statements were approved by the board of directors and authorised for issue on 24 January 2025 and are signed on its behalf by:
24 January 2025
S J Hart
Director
Company Registration No. 10711624 (England and Wales)
Ellipsis Entertainment Ltd
Group Statement of Changes in Equity
For the year ended 31 March 2024
Page 13
Share capital
Share premium account
Equity reserve
Other reserves
Profit and loss reserves
Total controlling interest
Non-controlling interest
Total
Notes
£
£
£
£
£
£
£
£
As restated for the period ended 31 March 2023:
Balance at 1 January 2022
21,977
9,410,540
-
0
-
(6,976,514)
2,456,003
-
2,456,003
Period ended 31 March 2023:
Loss and total comprehensive income for the period
-
-
-
-
(2,509,909)
(2,509,909)
-
(2,509,909)
Issue of share capital
26
1,110
2,008,141
-
-
-
2,009,251
-
2,009,251
Issue of convertible loan
22
-
-
158,302
-
-
158,302
-
158,302
Balance at 31 March 2023
23,087
11,418,681
158,302
-
(9,486,423)
2,113,647
-
0
2,113,647
Year ended 31 March 2024:
Loss and total comprehensive income for the year
-
-
-
-
(9,677,318)
(9,677,318)
-
(9,677,318)
Issue of share capital
26
1,662
2,938,166
-
-
-
2,939,828
-
2,939,828
Issue of convertible loan
22
-
-
420,109
-
-
420,109
-
420,109
Acquisition of subsidiary
-
-
-
-
-
-
1
1
Other movements
-
-
-
250,000
-
250,000
-
250,000
Balance at 31 March 2024
24,749
14,356,847
578,411
250,000
(19,163,741)
(3,953,734)
1
(3,953,733)
Ellipsis Entertainment Ltd
Company Statement of Changes in Equity
For the year ended 31 March 2024
Page 14
Share capital
Share premium account
Equity reserve
Profit and loss reserves
Total
Notes
£
£
£
£
£
As restated for the period ended 31 March 2023:
Balance at 1 January 2022
21,977
9,410,540
-
0
(7,439,600)
1,992,917
Period ended 31 March 2023:
Loss and total comprehensive income for the period
-
-
-
(1,257,384)
(1,257,384)
Issue of share capital
26
1,110
2,008,141
-
-
2,009,251
Issue of convertible loan
22
-
-
158,302
-
158,302
Balance at 31 March 2023
23,087
11,418,681
158,302
(8,696,984)
2,903,086
Year ended 31 March 2024:
Loss and total comprehensive income for the year
-
-
-
(9,265,422)
(9,265,422)
Issue of share capital
26
1,662
2,938,166
-
-
2,939,828
Issue of convertible loan
22
-
-
420,109
-
420,109
Balance at 31 March 2024
24,749
14,356,847
578,411
(17,962,406)
(3,002,399)
Ellipsis Entertainment Ltd
Group Statement of Cash Flows
For the year ended 31 March 2024
Page 15
2024
2023
as restated
Notes
£
£
£
£
Cash flows from operating activities
Cash (absorbed by)/generated from operations
28
(2,687,589)
181,410
Interest paid
(115,314)
(88,963)
Income taxes refunded
186,617
961,153
Net cash (outflow)/inflow from operating activities
(2,616,286)
1,053,600
Investing activities
Purchase of intangible assets
(1,519,346)
(3,849,139)
Proceeds from disposal of intangibles
-
12,000
Purchase of tangible fixed assets
(9,215)
(88,273)
Interest received
1,523
-
0
Net cash used in investing activities
(1,527,038)
(3,925,412)
Financing activities
Proceeds from issue of shares
3,189,829
2,009,251
Issue of convertible loans
1,590,000
99,140
Repayment of borrowings
(375,907)
(263,133)
Repayment of bank loans
(5,585)
(6,788)
Payment of finance leases obligations
(198,306)
(104,383)
Net cash generated from financing activities
4,200,031
1,734,087
Net increase/(decrease) in cash and cash equivalents
56,707
(1,137,725)
Cash and cash equivalents at beginning of year
61,410
1,199,135
Cash and cash equivalents at end of year
118,117
61,410
Ellipsis Entertainment Ltd
Notes to the Group Financial Statements
For the year ended 31 March 2024
Page 16
1
Accounting policies
Company information

Ellipsis Entertainment Ltd (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is Shepherd and Wedderburn LLP, Octagon Point, 5 Cheapside, London, United Kingdom, EC2V 6AA.

 

The group consists of Ellipsis Entertainment Ltd and all of its subsidiaries.

1.1
Reporting period

The current reporting period is for the 12 months ended 31 March 2024. The comparative amounts including the related notes are for the 15 month period ended 31 March 2023 so are not entirely comparable.

1.2
Accounting convention

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

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

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

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

 

Ellipsis Entertainment Ltd
Notes to the Group Financial Statements (Continued)
For the year ended 31 March 2024
1
Accounting policies
(Continued)
Page 17
1.3
Business combinations

In the parent company financial statements, the cost of a business combination is the fair value at the acquisition date of the assets given, equity instruments issued and liabilities incurred or assumed, plus costs directly attributable to the business combination. The excess of the cost of a business combination over the fair value of the identifiable assets, liabilities and contingent liabilities acquired is recognised as goodwill. The cost of the combination includes the estimated amount of contingent consideration that is probable and can be measured reliably, and is adjusted for changes in contingent consideration after the acquisition date. Provisional fair values recognised for business combinations in previous periods are adjusted retrospectively for final fair values determined in the 12 months following the acquisition date. Investments in subsidiaries, joint ventures and associates are accounted for at cost less impairment.

 

Deferred tax is recognised on differences between the value of assets (other than goodwill) and liabilities recognised in a business combination accounted for using the purchase method and the amounts that can be deducted or assessed for tax, considering the manner in which the carrying amount of the asset or liability is expected to be recovered or settled. The deferred tax recognised is adjusted against goodwill or negative goodwill.

1.4
Basis of consolidation

The consolidated group financial statements consist of the financial statements of the parent company Ellipsis Entertainment Ltd together with all entities controlled by the parent company (its subsidiaries) and the group’s share of its interests in joint ventures and associates.

 

All financial statements are made up to 31 March 2024. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.

 

All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.

Subsidiaries are consolidated in the group’s financial statements from the date that control commences until the date that control ceases.

Entities in which the group holds an interest and which are jointly controlled by the group and one or more other venturers under a contractual arrangement are treated as joint ventures. Entities other than subsidiary undertakings or joint ventures, in which the group has a participating interest and over whose operating and financial policies the group exercises a significant influence, are treated as associates.

Investments in joint ventures and associates are carried in the group balance sheet at cost plus post-acquisition changes in the group’s share of the net assets of the entity, less any impairment in value. The carrying values of investments in joint ventures and associates include acquired goodwill.

 

If the group’s share of losses in a joint venture or associate equals or exceeds its investment in the joint venture or associate, the group does not recognise further losses unless it has incurred obligations to do so or has made payments on behalf of the joint venture or associate.

 

Unrealised gains arising from transactions with joint ventures and associates are eliminated to the extent of the group’s interest in the entity.

Ellipsis Entertainment Ltd
Notes to the Group Financial Statements (Continued)
For the year ended 31 March 2024
1
Accounting policies
(Continued)
Page 18
1.5
Going concern

These financial statements are prepared on the going concern basis. The directors have a reasonable expectation that the group will continue in operational existence for the foreseeable future. In making this assessment, the directors have taken into consideration the following:

During the period, the business completed the initial development phase of the Layered Reality platform in line with expectations. This involved significant financial investment in building the team to support future development.

The completion of the platform, together with the ongoing commercial and reputational performance of the existing shows has enabled the business to secure new internationally renowned intellectual property, including the rights to tell Elvis Presley’s life story internationally in 2025 and beyond.

The reported loss for the year is inflated by the directors’ decision to write down the carrying value of previously capitalised production costs on the group’s original two productions, ‘The War of the Worlds’ and ‘The Gunpowder Plot’. The non-cash impairment charge is responsible for £6,299,247 of the reported loss of £9,677,318 for the period. While the directors are satisfied with the current performance of both productions, expected future cashflows are such that it is appropriate to write down the intangible asset representing the capitalised costs of their production to nil.

Subsequent to the year end, £4.0m has been raised through the issue of equity share capital, including £1.75 million under an equity for media arrangement with a national broadcaster.

The company has also agreed an extension to the redemption date of £1.83m of 2024 convertible loan notes to 31 December 2025. At the end of that term, holders of £1.15m of these notes have confirmed in writing that they will convert their holdings to equity and holders of a further £275k have now confirmed they will extend their conversion rights for a further 12 months. Consistent with the requirements of UKGAAP, these loan notes are classified within amounts falling due within one year in the balance sheet as the extension of the loan note terms was not agreed until post year-end.

In addition, immediately following signature of these accounts, Ellipsis Entertainment Limited expects to issue £2.4 million in 12.5% 2025 Convertible Loan Notes.

In assessing the whether the use of the going concern basis of preparation of the accounts is appropriate, the directors have prepared cashflow forecasts for the 12 months following the date of the signature of the accounts. In preparing future forecasts the directors are required to consider and make judgements about inherently uncertain future events and conditions and in particular the future performance of its shows.

The groups marketing and ticketing system has led to an increase in sales for existing productions. Forecasts assume a further increase in sales over the course of the next 12 months.

Tickets for Layered Reality’s next production, Elvis Evolution went on sale on 9 October 2024 and is due to open in May 2025. As at the date of issue of this report, advanced ticket reservations and sales totalled £5m. In common with all new productions there is a degree of uncertainty around the expected performance of the show, however, the level of sales to date gives the directors confidence in their financial projections and the likely success of the show.

Ellipsis Entertainment Ltd
Notes to the Group Financial Statements (Continued)
For the year ended 31 March 2024
1
Accounting policies
(Continued)
Page 19

The directors engage in conversations with funders on an ongoing basis and, as with earlier funding rounds, were additional funds to be required the directors are confident these funds would be raised as necessary. The company also plans to part-finance the cost of building new shows through bank finance secured on UK tax credits. Included in the total funding target is £2.9m relating to tax credit loans which are being finalised with a bank.

The business continues to perform in accordance with its business plan and the directors are confident that the assumptions that they have made in preparing their cashflow forecasts are appropriate. The directors therefore continue to prepare the accounts on a going concern basis.

1.6
Turnover

Turnover comprises of revenue recognised by the company in respect of ticket, merchandise, and food sales exclusive of VAT. The first of two streams of income recognised in the accounts is ticket sales, and revenue for the immersive show is recognised partially at ticket sale and partially at show completion.

 

The entire revenue is therefore recognised once the ticket holder has received the benefit of entertainment of the show. All amounts received in advance are carried forward as deferred income up until the show date. Food and merchandise sales are recognised at point of sale.

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

1.7
Research and development expenditure

Research expenditure is written off against profits in the year in which it is incurred. Identifiable development expenditure is capitalised to the extent that the technical, commercial and financial feasibility can be demonstrated.

1.8
Intangible fixed assets other than goodwill

Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.

 

Intangible assets acquired on business combinations are recognised separately from goodwill at the acquisition date where it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the fair value of the asset can be measured reliably; the intangible asset arises from contractual or other legal rights; and the intangible asset is separable from the entity.

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

Development costs
Expected life of the show
1.9
Tangible fixed assets

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Ellipsis Entertainment Ltd
Notes to the Group Financial Statements (Continued)
For the year ended 31 March 2024
1
Accounting policies
(Continued)
Page 20

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

Fixtures and fittings
20% Straight line basis
Computers
20% Straight line basis

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in the profit and loss account.

1.10
Fixed asset investments

Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available.

 

In the parent company financial statements, investments in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.

A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The group considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.

 

Investments in associates are initially recognised at the transaction price (including transaction costs) and are subsequently adjusted to reflect the group’s share of the profit or loss, other comprehensive income and equity of the associate using the equity method. Any difference between the cost of acquisition and the share of the fair value of the net identifiable assets of the associate on acquisition is recognised as goodwill. Any unamortised balance of goodwill is included in the carrying value of the investment in associates.

 

Losses in excess of the carrying amount of an investment in an associate are recorded as a provision only when the company has incurred legal or constructive obligations or has made payments on behalf of the associate.

 

In the parent company financial statements, investments in associates are accounted for at cost less impairment.

Entities in which the group has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.

Ellipsis Entertainment Ltd
Notes to the Group Financial Statements (Continued)
For the year ended 31 March 2024
1
Accounting policies
(Continued)
Page 21
1.11
Impairment of fixed assets

At each reporting period end date, the group reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

 

The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

 

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

1.12
Stocks

Stock are stated at the lower of cost and estimated selling price less costs to complete and sell. Costs comprisee of bar and merchandise stock and overheads that have been incurred in bringing the stock to their present location and condition.

 

Stock held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

1.13
Cash and cash equivalents

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

Ellipsis Entertainment Ltd
Notes to the Group Financial Statements (Continued)
For the year ended 31 March 2024
1
Accounting policies
(Continued)
Page 22
1.14
Financial instruments

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

 

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

 

Financial assets and liabilities are offset and 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.

Fair value measurement of financial instruments

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

 

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

 

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

Basic financial assets

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

Other financial assets

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

Ellipsis Entertainment Ltd
Notes to the Group Financial Statements (Continued)
For the year ended 31 March 2024
1
Accounting policies
(Continued)
Page 23
Impairment of financial assets

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

 

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

 

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

Derecognition of financial assets

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

Classification of financial liabilities

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

Basic financial liabilities

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

 

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

 

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

Ellipsis Entertainment Ltd
Notes to the Group Financial Statements (Continued)
For the year ended 31 March 2024
1
Accounting policies
(Continued)
Page 24
Other financial liabilities

Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.

 

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

Derecognition of financial liabilities

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

1.15
Compound instruments

The component parts of compound instruments issued by the group are classified separately as financial liabilities and equity in accordance with the substance of the contractual arrangement. At the date of issue, the fair value of the liability component is estimated using the prevailing market interest rate for a similar non-convertible instrument. This amount is recorded as a liability on an amortised cost basis using the effective interest method until extinguished upon conversion or at the instrument's maturity date. The equity component is determined by deducting the amount of the liability component from the fair value of the compound instrument as a whole. This is recognised and included in equity net of income tax effects and is not subsequently remeasured.

1.16
Equity instruments

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

1.17
Taxation

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

Current tax

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

Ellipsis Entertainment Ltd
Notes to the Group Financial Statements (Continued)
For the year ended 31 March 2024
1
Accounting policies
(Continued)
Page 25
Deferred tax

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

 

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

1.18
Employee benefits

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

 

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

 

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

1.19
Retirement benefits

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

1.20
Share-based payments

Equity-settled share-based payments are measured at fair value at the date of grant by reference to the fair value of the equity instruments granted using the fair value through profit and loss model. The fair value determined at the grant date is expensed on a straight-line basis over the vesting period, based on the estimate of shares that will eventually vest. A corresponding adjustment is made to equity.

1.21
Leases

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.

 

Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.

Ellipsis Entertainment Ltd
Notes to the Group Financial Statements (Continued)
For the year ended 31 March 2024
Page 26
2
Judgements 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 associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

 

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

Critical judgements

The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.

Capitalised pre-production costs

Pre-production costs have been capitalised as an intangible fixed asset and amortised over the estimated life of the production. In assessing whether those pre-production costs will provide future economic benefit, the directors assess the likely profitability of the company through the preparation and review of post balance sheet information and forecasts.

3
Turnover and other revenue
2024
2023
£
£
Turnover analysed by class of business
Ticket sales
4,939,023
5,943,063
Bar sales
1,348,412
1,635,500
Merchandise sales
439,340
590,844
6,726,775
8,169,407
2024
2023
£
£
Other revenue
Interest income
1,523
-
4
Exceptional item

An impairment loss of £6,299,247 (2023 - £0) relating to production costs has been recognised in in the profit and loss account.

Ellipsis Entertainment Ltd
Notes to the Group Financial Statements (Continued)
For the year ended 31 March 2024
Page 27
5
Operating loss
2024
2023
£
£
Operating loss for the year is stated after charging:
Exchange losses
412
-
Research and development costs
143,607
-
Depreciation of owned tangible fixed assets
33,585
36,198
(Profit)/loss on disposal of tangible fixed assets
-
2,637
Amortisation of intangible assets
1,202,872
1,207,665
Impairment of intangible assets
6,299,247
-
0
Loss on disposal of intangible assets
1,828
-
Operating lease charges
983,268
1,099,415
6
Auditor's remuneration
2024
2023
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the group and company
32,500
-
7
Employees

The average monthly number of persons (including directors) employed by the group and company during the year was:

Group
Company
2024
2023
2024
2023
Number
Number
Number
Number
87
88
46
42

Their aggregate remuneration comprised:

Group
Company
2024
2023
2024
2023
£
£
£
£
Wages and salaries
2,922,536
2,835,293
1,755,413
1,672,315
Social security costs
185,823
107,641
123,574
41,515
Pension costs
43,137
30,003
23,008
2,253
3,151,496
2,972,937
1,901,995
1,716,083
Ellipsis Entertainment Ltd
Notes to the Group Financial Statements (Continued)
For the year ended 31 March 2024
Page 28
8
Directors' remuneration
2024
2023
£
£
Remuneration for qualifying services
48,000
-

As total directors' remuneration was less than £200,000 in the current year, no disclosure is provided for that year.

9
Interest receivable and similar income
2024
2023
£
£
Interest income
Interest on bank deposits
1,523
-
0

Investment income includes the following:

Interest on financial assets not measured at fair value through profit or loss
1,523
-
10
Interest payable and similar expenses
2024
2023
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
1,032
-
Other interest on financial liabilities
492,931
662,692
493,963
662,692
Other finance costs:
Interest on finance leases and hire purchase contracts
56,067
96,200
Other interest
4,854
4,675
Total finance costs
554,884
763,567
11
Taxation
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
(507,647)
(1,369,773)
Adjustments in respect of prior periods
20,079
-
0
Total current tax
(487,568)
(1,369,773)

Of the charge to current tax in relation to discontinued operations, £0 relates to tax on profits and £0 arose on disposal.

Ellipsis Entertainment Ltd
Notes to the Group Financial Statements (Continued)
For the year ended 31 March 2024
11
Taxation
(Continued)
Page 29

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

2024
2023
£
£
Loss before taxation
(10,164,886)
(3,879,682)
Expected tax credit based on the standard rate of corporation tax in the UK of 19.00% (2023: 19.00%)
(1,931,328)
(737,140)
Unutilised tax losses carried forward
1,443,760
(649,038)
Transition adjustments
-
16,405
Taxation credit
(487,568)
(1,369,773)
12
Intangible fixed assets
Group
Development costs
£
Cost
At 1 April 2023
11,357,264
Additions
1,519,346
Disposals
(4,425)
At 31 March 2024
12,872,185
Amortisation and impairment
At 1 April 2023
3,255,579
Amortisation charged for the year
1,202,872
Impairment losses
6,299,247
Disposals
(2,597)
At 31 March 2024
10,755,101
Carrying amount
At 31 March 2024
2,117,084
At 31 March 2023
8,101,685
Ellipsis Entertainment Ltd
Notes to the Group Financial Statements (Continued)
For the year ended 31 March 2024
12
Intangible fixed assets
(Continued)
Page 30
Company
Development costs
£
Cost
At 1 April 2023
5,454,124
Additions
1,331,706
Disposals
(4,425)
At 31 March 2024
6,781,405
Amortisation and impairment
At 1 April 2023
2,728,513
Amortisation charged for the year
570,393
Impairment losses
1,534,202
Disposals
(2,597)
At 31 March 2024
4,830,511
Carrying amount
At 31 March 2024
1,950,894
At 31 March 2023
2,725,611

More information on impairment movements in the year is given in note 4.

13
Tangible fixed assets
Group
Fixtures and fittings
Computers
Total
£
£
£
Cost
At 1 April 2023
165,452
5,789
171,241
Additions
9,215
-
0
9,215
At 31 March 2024
174,667
5,789
180,456
Depreciation and impairment
At 1 April 2023
81,022
1,235
82,257
Depreciation charged in the year
32,427
1,158
33,585
At 31 March 2024
113,449
2,393
115,842
Carrying amount
At 31 March 2024
61,218
3,396
64,614
At 31 March 2023
84,430
4,554
88,984
Ellipsis Entertainment Ltd
Notes to the Group Financial Statements (Continued)
For the year ended 31 March 2024
13
Tangible fixed assets
(Continued)
Page 31
Company
Fixtures and fittings
£
Cost
At 1 April 2023
83,791
Additions
9,215
At 31 March 2024
93,006
Depreciation and impairment
At 1 April 2023
66,114
Depreciation charged in the year
16,095
At 31 March 2024
82,209
Carrying amount
At 31 March 2024
10,797
At 31 March 2023
17,677
14
Fixed asset investments
Group
Company
2024
2023
2024
2023
Notes
£
£
£
£
Investments in subsidiaries
15
-
0
-
0
101
1
Movements in fixed asset investments
Company
Shares in subsidiaries
£
Cost or valuation
At 1 April 2023
1
Additions
100
At 31 March 2024
101
Carrying amount
At 31 March 2024
101
At 31 March 2023
1
Ellipsis Entertainment Ltd
Notes to the Group Financial Statements (Continued)
For the year ended 31 March 2024
Page 32
15
Subsidiaries

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

Name of undertaking
Registered office
Class of
% Held
shares held
Direct
Gunpowder Immersive Limited
England and Wales
Ordinary
100
Rex Immersive Limited
England and Wales
Ordinary
99

Rex Immersive Limited has claimed exemption from audit under section 479A of the Companies Act 2006.

16
Stocks
Group
Company
2024
2023
2024
2023
£
£
£
£
Raw materials and consumables
82,216
75,700
55,320
54,358
Work in progress
-
105,851
-
105,851
82,216
181,551
55,320
160,209
17
Debtors
Group
Company
2024
2023
2024
2023
Amounts falling due within one year:
£
£
£
£
Trade debtors
123,577
90,906
72,681
55,647
Unpaid share capital
14,393
14,393
14,393
14,393
Corporation tax recoverable
728,261
281,173
706,789
192,309
Amounts owed by group undertakings
-
-
987,487
4,784,543
Prepayments and accrued income
2,050,952
843,131
543,616
411,357
2,917,183
1,229,603
2,324,966
5,458,249
Amounts falling due after more than one year:
Other debtors
175,000
175,000
175,000
175,000
Total debtors
3,092,183
1,404,603
2,499,966
5,633,249
Ellipsis Entertainment Ltd
Notes to the Group Financial Statements (Continued)
For the year ended 31 March 2024
Page 33
18
Creditors: amounts falling due within one year
Group
Company
2024
2023
2024
2023
Notes
£
£
£
£
Convertible loans
22
2,055,786
-
0
2,055,786
-
0
Bank loans
20
5,726
5,588
5,726
5,588
Obligations under finance leases
21
138,044
179,251
-
0
25,743
Other borrowings
20
1,134,231
375,907
1,134,231
375,907
Trade creditors
2,061,855
2,416,538
816,233
1,001,442
Other taxation and social security
394,384
498,798
358,615
451,642
Deferred income
23
514,470
478,551
411,163
474,870
Other creditors
82,792
746,172
15,224
521,391
Accruals and deferred income
650,475
810,712
511,736
773,156
7,037,763
5,511,517
5,308,714
3,629,739
19
Creditors: amounts falling due after more than one year
Group
Company
2024
2023
2024
2023
Notes
£
£
£
£
Convertible loans
22
585,546
1,185,354
585,546
1,185,354
Bank loans and overdrafts
20
31,901
37,624
31,901
37,624
Obligations under finance leases
21
13,216
170,315
-
0
3,928
Other borrowings
20
-
0
921,122
-
0
921,122
Deferred income
23
818,182
-
0
818,182
-
0
Other creditors
605,000
(107,366)
480,000
(107,366)
Accruals and deferred income
336,339
6,020
336,339
6,020
2,390,184
2,213,069
2,251,968
2,046,682
20
Loans and overdrafts
Group
Company
2024
2023
2024
2023
£
£
£
£
Bank loans
37,627
43,212
37,627
43,212
Other loans
1,134,231
1,297,029
1,134,231
1,297,029
1,171,858
1,340,241
1,171,858
1,340,241
Payable within one year
1,139,957
381,495
1,139,957
381,495
Payable after one year
31,901
958,746
31,901
958,746
Ellipsis Entertainment Ltd
Notes to the Group Financial Statements (Continued)
For the year ended 31 March 2024
Page 34
21
Finance lease obligations
Group
Company
2024
2023
2024
2023
£
£
£
£
Future minimum lease payments due under finance leases:
Within one year
138,044
179,251
-
0
25,743
In two to five years
13,216
170,315
-
0
3,928
151,260
349,566
-
29,671

Finance lease payments represent rentals payable by the company or group for certain items of plant and machinery. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is 4 years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.

22
Convertible loan notes
Group
Company
2024
2023
2024
2023
£
£
£
£
Liability component of convertible loan notes
2,641,332
1,185,354
2,641,332
1,185,354

The net proceeds received from the issue of the convertible loan notes have been split between the financial liability element and an equity component, representing the fair value of the embedded option to convert the financial liability into equity.

The net proceeds received from the issue of the convertible loan notes have been split between the financial liability element and an equity component, representing the fair value of the embedded option to convert the financial liability into equity.

The liability component is measured at amortised cost, and the difference between the carrying amount of the liability at the date of issue and the amount reported in the Balance Sheet represents the effective interest rate less interest paid to that date.

The effective rate of interest is 17%.

The equity component of the convertible loan notes has been credited to the equity reserve.

23
Deferred income
Group
Company
2024
2023
2024
2023
£
£
£
£
Other deferred income
1,332,652
478,551
1,229,345
474,870
Ellipsis Entertainment Ltd
Notes to the Group Financial Statements (Continued)
For the year ended 31 March 2024
23
Deferred income
(Continued)
Page 35

Deferred income is included in the financial statements as follows:

Current liabilities
514,470
478,551
411,163
474,870
Non-current liabilities
818,182
-
0
818,182
-
0
1,332,652
478,551
1,229,345
474,870
24
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
43,137
30,003

A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.

25
Share-based payment transactions

Share Options

Certain employees of the company have been granted options over the shares in Ellipsis Entertainment Limited. The options are granted with a fixed exercise price and are exercisable on exit-only. Employees are required to remain in employment with the company until the options become exercisable.

 

Out of the 188,763 outstanding options (2023: 188,763 options), none (2023: none) were exercisable.

 

Warrants

During the period, warrants over an aggregate of 9,940 shares were granted in Ellipsis Entertainment Limited.

Group
Number of share options
Weighted average exercise price
2024
2023
2024
2023
Number
Number
£
£
Outstanding at 1 April 2023 and 31 March 2024
188,763
188,763
0.01
0.01
Exercisable at 31 March 2024
-
-
-
-

The options outstanding at 31 March 2024 had an exercise price of £0.01, with an indefinite contractual life.

The total intrinsic value at 31 March 2024 amounted to £1,888 (2023 - £1,888) for the group and £1,888 (2023 - £1,888) for the company.

Ellipsis Entertainment Ltd
Notes to the Group Financial Statements (Continued)
For the year ended 31 March 2024
Page 36
26
Share capital
Group and company
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and not fully paid
Ordinary of 1p each
1,974,907
1,808,706
19,749
18,087
A Ordinary of 10p each
50,000
50,000
5,000
5,000
2,024,907
1,858,706
24,749
23,087

The company has issued 1,974,907 Ordinary shares of 1p each of which 1,024,907 have been fully paid. 950,000 Ordinary shares have been issued but not fully paid.

 

The company has issued 50,000 A Ordinary shares of 10p each but are not fully paid.

27
Reserves

Other reserves

Other reserves represent the excess of the consideration received by a subsidiary of the group on issue issue of equity share capital to shareholders other than its parent company over the value of the non-controlling interest disposed of by the group at that date.

 

 

Equity reserves

Equity reserves represent the equity element identified in relation to convertible loan notes issued by the group/company.

28
Cash (absorbed by)/generated from group operations
2024
2023
£
£
Loss for the year after tax
(9,677,318)
(2,509,910)
Adjustments for:
Taxation credited
(487,568)
(1,369,773)
Finance costs
498,772
1,328,517
Investment income
(1,523)
-
0
(Gain)/loss on disposal of tangible fixed assets
-
2,637
Loss on disposal of intangible assets
1,828
-
Amortisation and impairment of intangible assets
7,502,119
1,207,665
Depreciation and impairment of tangible fixed assets
33,585
36,198
Movements in working capital:
Decrease/(increase) in stocks
99,335
(134,578)
(Increase)/decrease in debtors
(1,386,629)
909,040
Increase in creditors
729,810
711,614
Cash (absorbed by)/generated from operations
(2,687,589)
181,410
Ellipsis Entertainment Ltd
Notes to the Group Financial Statements (Continued)
For the year ended 31 March 2024
Page 37
29
Analysis of changes in net debt - group
1 April 2023
Cash flows
31 March 2024
£
£
£
Cash at bank and in hand
61,410
56,707
118,117
Borrowings excluding overdrafts
(1,340,241)
168,383
(1,171,858)
Obligations under finance leases
(349,566)
198,306
(151,260)
Convertible loan notes
(1,185,354)
(1,455,978)
(2,641,332)
(2,813,751)
(1,032,582)
(3,846,333)
30
Prior period adjustment
Changes to the balance sheet - group
As previously reported
Adjustment
As restated at 31 Mar 2023
£
£
£
Current assets
Debtors due within one year
1,451,103
(46,500)
1,404,603
Creditors due within one year
Other creditors
(4,040,734)
67,312
(3,973,422)
Creditors due after one year
Loans and overdrafts
(2,087,886)
1,129,140
(958,746)
Convertible loans
-
(1,185,354)
(1,185,354)
Other creditors
(6,020)
107,366
101,346
Net assets
2,041,683
71,964
2,113,647
Capital and reserves
Equity reserve
-
158,302
158,302
Profit and loss reserves
(9,400,085)
(86,338)
(9,486,423)
Total equity
2,041,683
71,964
2,113,647
Ellipsis Entertainment Ltd
Notes to the Group Financial Statements (Continued)
For the year ended 31 March 2024
30
Prior period adjustment
(Continued)
Page 38
Changes to the balance sheet - company
As previously reported
Adjustment
As restated at 31 Mar 2023
£
£
£
Current assets
Debtors due within one year
5,679,749
(46,500)
5,633,249
Creditors due within one year
Other creditors
(2,363,301)
67,312
(2,295,989)
Creditors due after one year
Loans and overdrafts
(2,087,886)
1,129,140
(958,746)
Convertible loans
-
(1,185,354)
(1,185,354)
Other creditors
(6,020)
107,366
101,346
Net assets
2,831,122
71,964
2,903,086
Capital and reserves
Equity reserve
-
158,302
158,302
Profit and loss reserves
(8,610,646)
(86,338)
(8,696,984)
Total equity
2,831,122
71,964
2,903,086
Notes to reconciliation

The prior period figures have been amended as a result of conversion rights on the convertible loans and loan arrangement fees being incorrectly treated . The presentation of the convertible loans were also incorrect. Correcting these errors has resulted in a decrease in Debtors due within one year, decrease in Creditors due within one year, decrease in Creditors due over one year and a increase of the equity reserve as stated above. Net assets and capital and reserves have therefore increased by £71,964. The adjustment has increased the loss for the period by £86,338 and has no effect to the tax charge.

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