Company registration number 10431870 (England and Wales)
LOMBOK INVESTMENTS LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2024
LB GROUP
19th Floor
1 Westfield Avenue
London
E20 1HZ
LOMBOK INVESTMENTS LIMITED
COMPANY INFORMATION
Directors
Mr K C R Hewkin
Mr G A Fazio
(Appointed 26 April 2024)
Ms K Fazio
(Appointed 26 April 2024)
Company number
10431870
Registered office
376 London Road
High Wycombe
HP11 1LH
Auditor
LB Group Limited (Stratford)
19th Floor
1 Westfield Avenue
London
E20 1HZ
Bankers
HSBC UK Bank Plc
130 New Street
West Midlands
Birmingham
England
B2 4JU
LOMBOK INVESTMENTS LIMITED
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 - 32
LOMBOK INVESTMENTS LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 JANUARY 2024
- 1 -

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

Fair review of the business

The results for the year and the financial position at the period end were considered strong by the directors within the current climate of the global economy.

 

The directors consider turnover, net gross profit, net gross profit margin, employees and losses before tax to be the key measures of financial performance.

 

31 January 2024     31 January 2023         % Change

 

Turnover            £22.3m            £21.1m            up 5.69%

 

Gross Profit            £13.9m            £11.6m            up 19.83%

 

Gross Profit Margin (%)        62.33%            55.08%            up 7.25%

 

EBITDA                (£4.49m)        (£4.35m)        down 3.11%

 

Net Assets/(liabilities)        (£5,210k)        £1,202k            down 533.44%

 

Employees            223            207            up 7.73%

 

 

Following periods of significant growth and the subsequent ongoing support necessary to sustain it, we conducted a comprehensive review of all aspects of the business, ranging from product design to marketing efficiency and product delivery, with the objective of ensuring future margins would allow the business to operate profitably. This undertaking, which commenced in 2022, continued to be of paramount importance as the global economy introduced new cost challenges to the business.

 

At the conclusion of 2023, we had the privilege of welcoming 4 Ventures Limited, alongside Industrial Lending 1 SA, as investors in the business. This new investment facilitated access to additional funds for television marketing campaigns predominantly executed during 2023, enabling the company to build brand awareness beyond our previous audience.

 

Subsequent to the year-end, we were pleased to welcome Sleep Brands Limited as the new owners of the group, thereby allowing us to leverage and maximise our working capital position, and streamline operations and production. This development was further enhanced by our ability to expedite delivery times and improve customer service through the utilisation of a broader network of warehousing, distribution, and production facilities.

 

The forthcoming 18 months will witness further product expansion to support the growth plans forecasted, along with significant improvements in gross margin and reduced operating costs, both resulting from a change in the sourcing of products.

 

This is an exciting period for the group as we move forward, presenting the opportunity to explore numerous core opportunities within the organisation and the wider market.

Principal risks and uncertainties

The Group can be exposed to foreign exchange risk as a number of vendors invoice in currencies other than the reporting currency. The Group does not use forward currency contracts to manage its exposure to certain foreign currency exchange rates.

The key performance indicators are considered to be turnover and profit before tax. These are detailed in the fair review of the business. The director consider that these KPIs have been met.

The directors consider there to be no other performance indicators.

LOMBOK INVESTMENTS LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 2 -

On behalf of the board

Mr K C R Hewkin
Director
31 January 2025
LOMBOK INVESTMENTS LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 JANUARY 2024
- 3 -

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

Principal activities

The principal activity of the company was that of a holding company, whilst those of the group also continued to be that of a holding company, an online furniture retailer and furniture manufacturing.

Results and dividends

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

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

Directors

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

Mr P Fielden
(Resigned 14 March 2024)
Mr K C R Hewkin
Mr G A Fazio
(Appointed 26 April 2024)
Ms K Fazio
(Appointed 26 April 2024)
Auditor

The auditor, LB Group Limited (Stratford), is deemed to be reappointed under section 487(2) of the Companies Act 2006.

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
Mr K C R Hewkin
Director
31 January 2025
LOMBOK INVESTMENTS LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 JANUARY 2024
- 4 -

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

 

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have 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.

LOMBOK INVESTMENTS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF LOMBOK INVESTMENTS LIMITED
- 5 -

Qualified opinion

We have audited the financial statements of Lombok Investments Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 January 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, except for the effects of the matter described in the Basis for Qualified Opinion paragraph, the financial statements:

 

Basis for qualified opinion

As the group was unaudited in the year ended 31 January 2022, due to not requiring an audit, we were not appointed as auditor of the group until after 31 January 2022 and thus did not observe the counting of physical inventories at the end of that year. We were unable to satisfy ourselves by alternative means concerning the inventory quantities held at 31 January 2022, which are included in the balance sheet at £1,756,101 by using other audit procedures. Consequently we were unable to determine whether any adjustment to this amount, and the cost of sales included in the year ended 31 January 2023, was necessary.

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 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 qualified opinion.

Emphasis of Matter

We draw your attention to note 29 of these financial statements, which describes the details the prior year adjustment. Our opinion is not modified in respect of this matter.

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 group's and parent 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.

LOMBOK INVESTMENTS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF LOMBOK INVESTMENTS LIMITED
- 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.

 

As described in the Basis for qualified opinion section of our report, our audit opinion is qualified for inventory quantities held as at 31 January 2022 and any adjustments to this amount.

Opinions on other matters prescribed by the Companies Act 2006

Except for the matter described in the Basis for qualified opinion section of our report, 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 respect solely of the limitation on our work relating to stock, described above:

 

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:

 

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 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.

LOMBOK INVESTMENTS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF LOMBOK INVESTMENTS LIMITED
- 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.

 

The extent to which the audit was considered capable of detecting irregularities including fraud

Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:

 

 

We assessed the susceptibility of the company’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:

 

 

To address the risk of fraud through management bias and override of controls, we:

 

 

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:

 

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.

 

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

LOMBOK INVESTMENTS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF LOMBOK INVESTMENTS LIMITED
- 8 -

Use of our report

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an auditor's 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.

Richard Lane (Senior Statutory Auditor)
For and on behalf of LB Group Limited (Stratford)
31 January 2025
Chartered Accountants
Statutory Auditor
19th Floor
1 Westfield Avenue
London
E20 1HZ
LOMBOK INVESTMENTS LIMITED
GROUP PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 JANUARY 2024
- 9 -
2024
2023
as restated
Notes
£
£
Turnover
3
22,348,605
21,066,902
Cost of sales
(8,525,604)
(9,463,679)
Gross profit
13,823,001
11,603,223
Distribution costs
(8,687,890)
(7,692,228)
Administrative expenses
(9,887,901)
(7,395,535)
Other operating income
65,394
3,615
Operating loss
4
(4,687,396)
(3,480,925)
Interest receivable and similar income
8
-
0
2,132
Interest payable and similar expenses
9
(663,794)
(5,970,221)
Loss before taxation
(5,351,190)
(9,449,014)
Tax on loss
10
(24,524)
(5,853)
Loss for the financial year
(5,375,714)
(9,454,867)
Loss for the financial year is all attributable to the owners of the parent company.
LOMBOK INVESTMENTS LIMITED
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 JANUARY 2024
- 10 -
2024
2023
£
£
Loss for the year
(5,375,714)
(9,454,867)
Other comprehensive income
-
-
Total comprehensive income for the year
(5,375,714)
(9,454,867)
Total comprehensive income for the year is all attributable to the owners of the parent company.
LOMBOK INVESTMENTS LIMITED
GROUP BALANCE SHEET
AS AT 31 JANUARY 2024
31 January 2024
- 11 -
2024
2023
as restated
Notes
£
£
£
£
Fixed assets
Goodwill
11
76,107
82,204
Other intangible assets
11
205,400
200,724
Total intangible assets
281,507
282,928
Tangible assets
12
682,228
716,236
963,735
999,164
Current assets
Stocks
15
1,735,442
2,363,475
Debtors
16
2,403,468
4,264,530
Cash at bank and in hand
179,700
468,625
4,318,610
7,096,630
Creditors: amounts falling due within one year
17
(9,295,221)
(6,893,699)
Net current (liabilities)/assets
(4,976,611)
202,931
Total assets less current liabilities
(4,012,876)
1,202,095
Creditors: amounts falling due after more than one year
18
(162,346)
-
Net (liabilities)/assets
(4,175,222)
1,202,095
Capital and reserves
Called up share capital
20
7
7
Share premium account
31,502,143
31,502,143
Other reserves
20
(35,759)
(34,156)
Profit and loss reserves
(35,641,613)
(30,265,899)
Total equity
(4,175,222)
1,202,095
The financial statements were approved by the board of directors and authorised for issue on 31 January 2025 and are signed on its behalf by:
31 January 2025
Mr K C R Hewkin
Director
Company registration number 10431870 (England and Wales)
LOMBOK INVESTMENTS LIMITED
COMPANY BALANCE SHEET
AS AT 31 JANUARY 2024
31 January 2024
- 12 -
2024
2023
Notes
£
£
£
£
Fixed assets
Investments
13
1,435
1,435
Current assets
Debtors
16
5
5
Creditors: amounts falling due within one year
17
(1,435)
(1,435)
Net current liabilities
(1,430)
(1,430)
Net assets
5
5
Capital and reserves
Called up share capital
20
7
7
Share premium account
31,502,143
31,502,143
Profit and loss reserves
(31,502,145)
(31,502,145)
Total equity
5
5

As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £0 (2023 - £31,502,145 loss).

The financial statements were approved by the board of directors and authorised for issue on 31 January 2025 and are signed on its behalf by:
31 January 2025
Mr K C R Hewkin
Director
Company registration number 10431870 (England and Wales)
LOMBOK INVESTMENTS LIMITED
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 JANUARY 2024
- 13 -
Share capital
Share premium account
Other reserve
Profit and loss reserves
Total
Notes
£
£
£
£
£
As restated for the period ended 31 January 2023:
Balance at 1 February 2022
5
-
0
51,154
(20,811,032)
(20,759,873)
Year ended 31 January 2023:
Loss and total comprehensive income
-
-
-
(9,454,867)
(9,454,867)
Issue of share capital
20
2
31,502,143
-
-
31,502,145
Impact of translation of overseas subsidiaries
-
-
(85,310)
-
(85,310)
Balance at 31 January 2023
7
31,502,143
(34,156)
(30,265,899)
1,202,095
Year ended 31 January 2024:
Loss and total comprehensive income
-
-
-
(5,375,714)
(5,375,714)
Impact of translation of overseas subsidiaries
-
-
(1,603)
-
(1,603)
Balance at 31 January 2024
7
31,502,143
(35,759)
(35,641,613)
(4,175,222)
LOMBOK INVESTMENTS LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 JANUARY 2024
- 14 -
Share capital
Share premium account
Profit and loss reserves
Total
Notes
£
£
£
£
As restated for the period ended 31 January 2023:
Balance at 1 February 2022
5
-
0
-
0
5
Year ended 31 January 2023:
Loss and total comprehensive income for the year
-
-
(31,502,145)
(31,502,145)
Issue of share capital
20
2
31,502,143
-
31,502,145
Balance at 31 January 2023
7
31,502,143
(31,502,145)
5
Year ended 31 January 2024:
Profit and total comprehensive income
-
-
-
-
0
Balance at 31 January 2024
7
31,502,143
(31,502,145)
5
LOMBOK INVESTMENTS LIMITED
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 JANUARY 2024
- 15 -
2024
2023
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from/(absorbed by) operations
27
144,856
(23,887,040)
Interest paid
(663,794)
(5,811,869)
Net cash outflow from operating activities
(518,938)
(29,698,909)
Investing activities
Purchase of intangible assets
(38,957)
(112,622)
Proceeds from disposal of intangibles
-
17,537
Purchase of tangible fixed assets
(146,076)
(385,151)
Interest received
-
0
591
Net cash used in investing activities
(185,033)
(479,645)
Financing activities
Proceeds from issue of shares
-
31,502,145
Foreign exchange reserve
24,188
(85,310)
Repayment of borrowings
-
(158,352)
Proceeds from new bank loans
1,266,430
-
Repayment of bank loans
(875,572)
(640,653)
Net cash generated from financing activities
415,046
30,617,830
Net (decrease)/increase in cash and cash equivalents
(288,925)
439,276
Cash and cash equivalents at beginning of year
468,625
29,349
Cash and cash equivalents at end of year
179,700
468,625
LOMBOK INVESTMENTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2024
- 16 -
1
Accounting policies
Company information

Lombok Investments Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is 376 London Road, High Wycombe, HP11 1LH.

 

The group consists of Lombok Investments Limited and all of its subsidiaries.

1.1
Accounting convention

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

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

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

1.2
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.

1.3
Basis of consolidation

The consolidated group financial statements consist of the financial statements of the parent company Lombok Investments Limited 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 January 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.

LOMBOK INVESTMENTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
1
Accounting policies
(Continued)
- 17 -

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.

1.4
Going concern

For the year ending 31 January 2024, the group moved from a loss making position during the start of the financial period into one of breakeven with a forward view to profitability. Ongoing work surrounding efficiencies across all areas of the business support this view and along with the continued funding and support, the directors, consider the group to be of a going concern.

 

During this period the company, as per note 25 of the period was able to secure the future of the company by a sale of the group to Sleep Brands Limited and was able to secure additional funds to support the settlement of HMRC debts and to provide future working capital for the growth of the group. In addition to this the group benefits from the continued support of its parent company and ultimate owners for a period in excess of 12 months from the date of the signing of the balance sheet.

1.5
Turnover

Turnover is recognised at the fair value of the consideration received or receivable for goods provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.

 

When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income.

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (once the item has been shipped), 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.

Credit note provisions in relation to sales are recognised in the financial statements on a net profit basis taking into account the assessed gross profit margin relating to the item on return. The company recognises the full credit note to sales and adjustment to stock on the acceptance of the goods at its warehouse and the transfer of assets to its control.

1.6
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.

1.7
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.

LOMBOK INVESTMENTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
1
Accounting policies
(Continued)
- 18 -

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:

Patents
10 Year Straight Line
Development costs
10 Year Straight Line
1.8
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.

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:

Plant and equipment
3-5 Years Straight Line
Computers
2-10 Years Straight Line
Motor vehicles
5 Years Straight Line or 25% Reducing Balance

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.

1.9
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.

1.10
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.

LOMBOK INVESTMENTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
1
Accounting policies
(Continued)
- 19 -

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.

1.11
Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.

 

Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.

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.

1.12
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.

1.13
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.

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.

LOMBOK INVESTMENTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
1
Accounting policies
(Continued)
- 20 -
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.

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.

LOMBOK INVESTMENTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
1
Accounting policies
(Continued)
- 21 -
Derecognition of financial liabilities

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

1.14
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.

1.15
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.

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.

1.16
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.

1.17
Retirement benefits

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

1.18
Leases

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.

LOMBOK INVESTMENTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
1
Accounting policies
(Continued)
- 22 -
1.19
Foreign exchange

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.

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.

 

Other key sources of estimation uncertainty:

 

 

 

3
Turnover and other revenue
2024
2023
£
£
Turnover analysed by class of business
Furniture Sales
22,348,605
21,066,902
2024
2023
£
£
Turnover analysed by geographical market
United Kingdom
22,348,605
21,066,902
2024
2023
£
£
Other revenue
Interest income
-
2,132
LOMBOK INVESTMENTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 23 -
4
Operating loss
2024
2023
£
£
Operating loss for the year is stated after charging:
Exchange losses
46,952
373,421
Research and development costs
48,454
9,492
Depreciation of owned tangible fixed assets
153,848
139,094
Amortisation of intangible assets
40,320
26,100
Operating lease charges
273,780
295,570
5
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
3,000
4,000
Audit of the financial statements of the company's subsidiaries
26,500
21,000
29,500
25,000
For other services
Audit-related assurance services
2,500
5,500
Taxation compliance services
2,500
2,500
5,000
8,000
6
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
223
207
-
0
-
0

Their aggregate remuneration comprised:

Group
Company
2024
2023
2024
2023
£
£
£
£
Wages and salaries
4,910,050
4,323,852
-
0
-
0
Social security costs
747,576
718,681
-
-
Pension costs
94,040
43,662
-
0
-
0
5,751,666
5,086,195
-
0
-
0
LOMBOK INVESTMENTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 24 -
7
Directors' remuneration
2024
2023
£
£
Remuneration for qualifying services
263,700
240,000
Company pension contributions to defined contribution schemes
-
1,137
263,700
241,137
Remuneration disclosed above includes the following amounts paid to the highest paid director:
2024
2023
£
£
Remuneration for qualifying services
131,850
120,000
Company pension contributions to defined contribution schemes
-
624
8
Interest receivable and similar income
2024
2023
£
£
Interest income
Interest on bank deposits
-
0
2,132
2024
2023
Investment income includes the following:
£
£
Interest on financial assets not measured at fair value through profit or loss
-
2,132
9
Interest payable and similar expenses
2024
2023
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
396,497
260,357
Interest on invoice finance arrangements
49,800
47,969
Interest payable to group undertakings
-
0
5,503,543
446,297
5,811,869
Other finance costs:
Finance costs for financial instruments measured at fair value through profit or loss
217,497
158,352
Total finance costs
663,794
5,970,221

In the prior year group undertakings interest includes an acceleration of interest under the terms of an agreement to convert debt due to the ultimate controlling party into share capital.

LOMBOK INVESTMENTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 25 -
10
Taxation
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
24,524
-
0
Deferred tax
Origination and reversal of timing differences
-
0
5,853
Total tax charge
24,524
5,853

 

The actual charge 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
(5,351,190)
(9,449,014)
Expected tax credit based on the standard rate of corporation tax in the UK of 24.00% (2023: 19.00%)
(1,284,286)
(1,795,313)
Tax effect of expenses that are not deductible in determining taxable profit
83,150
(1,991,742)
Tax effect of income not taxable in determining taxable profit
(3,163)
-
0
Unutilised tax losses carried forward
1,246,871
3,799,244
Permanent capital allowances in excess of depreciation
(18,048)
(12,189)
Deferred tax adjustments in respect of prior years
-
0
5,853
Taxation charge
24,524
5,853

On 1 April 2023 the headline rate of UK Corporation tax increased to 25%.

LOMBOK INVESTMENTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 26 -
11
Intangible fixed assets
Group
Patents
Development costs
Total
£
£
£
Cost
At 1 February 2023
108,992
242,359
351,351
Additions
4,970
33,987
38,957
Exchange adjustments
-
0
(469)
(469)
At 31 January 2024
113,962
275,877
389,839
Amortisation and impairment
At 1 February 2023
26,788
41,635
68,423
Amortisation charged for the year
11,067
29,253
40,320
Exchange adjustments
-
0
(411)
(411)
At 31 January 2024
37,855
70,477
108,332
Carrying amount
At 31 January 2024
76,107
205,400
281,507
At 31 January 2023
82,204
200,724
282,928
The company had no intangible fixed assets at 31 January 2024 or 31 January 2023.
12
Tangible fixed assets
Group
Plant and equipment
Computers
Motor vehicles
Total
£
£
£
£
Cost
At 1 February 2023
911,357
46,104
9,995
967,456
Additions
144,255
1,821
-
0
146,076
Exchange adjustments
(35,821)
-
0
-
0
(35,821)
At 31 January 2024
1,019,791
47,925
9,995
1,077,711
Depreciation and impairment
At 1 February 2023
208,464
38,383
4,373
251,220
Depreciation charged in the year
145,641
6,801
1,406
153,848
Exchange adjustments
(9,585)
-
0
-
0
(9,585)
At 31 January 2024
344,520
45,184
5,779
395,483
Carrying amount
At 31 January 2024
675,271
2,741
4,216
682,228
At 31 January 2023
702,893
7,721
5,622
716,236
The company had no tangible fixed assets at 31 January 2024 or 31 January 2023.
LOMBOK INVESTMENTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
12
Tangible fixed assets
(Continued)
- 27 -
13
Fixed asset investments
Group
Company
2024
2023
2024
2023
Notes
£
£
£
£
Investments in subsidiaries
14
-
0
-
0
1,435
1,435
Movements in fixed asset investments
Company
Shares in subsidiaries
£
Cost or valuation
At 1 February 2023 and 31 January 2024
1,435
Carrying amount
At 31 January 2024
1,435
At 31 January 2023
1,435
14
Subsidiaries

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

Name of undertaking
Registered office
Nature of business
Class of
% Held
shares held
Direct
Lombok Retail Limited
1 Vicarage Lane, Stratford, London, England, E15 4HF
Holder of group related financing
Ordinary Shares, Ordinary B Shares & Preference Shares
100.00
Swyft Home Limited
1 Vicarage Lane, Stratford, London, England, E15 4HF
Online furniture retailer
Ordinary Shares
100.00
Angora Manufacturing
RUA DA ASSOCIAÇÃO EMPRESARIAL, 167, Carvalhosa, Portugal, 4590-872
Furniture Manufacturing
Ordinary Shares
100.00

Subsequent to the year end Lombok Retail Limited was closed down.

15
Stocks
Group
Company
2024
2023
2024
2023
£
£
£
£
Raw materials and consumables
941,499
983,777
-
-
Finished goods and goods for resale
345,372
1,379,698
-
0
-
0
Goods In Transit
448,571
-
0
-
0
-
0
1,735,442
2,363,475
-
-
LOMBOK INVESTMENTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 28 -
16
Debtors
Group
Company
2024
2023
2024
2023
Amounts falling due within one year:
£
£
£
£
Trade debtors
727,110
1,131,224
-
0
-
0
Other debtors
1,010,969
770,680
5
5
Prepayments and accrued income
648,063
2,345,293
-
0
-
0
2,386,142
4,247,197
5
5
Amounts falling due after more than one year:
Other debtors
17,326
17,333
-
0
-
0
Total debtors
2,403,468
4,264,530
5
5
17
Creditors: amounts falling due within one year
Group
Company
2024
2023 (as restated)
2024
2023
Notes
£
£
£
£
Bank loans
869,250
478,392
-
0
-
0
Payments received on account
2,286,024
361,356
-
0
-
0
Trade creditors
3,102,083
3,509,577
-
0
-
0
Amounts owed to parent undertakings
-
0
-
0
1,435
1,435
Corporation tax payable
24,021
-
0
-
0
-
0
Other taxation and social security
1,805,396
1,219,365
-
-
Other creditors
452,126
1,005,736
-
0
-
0
Accruals and deferred income
756,321
319,273
-
0
-
0
9,295,221
6,893,699
1,435
1,435
18
Creditors: amounts falling due after more than one year
Group
Company
2024
2023
2024
2023
£
£
£
£
Other creditors
162,346
-
0
-
0
-
0
19
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
94,040
43,662
LOMBOK INVESTMENTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
19
Retirement benefit schemes
(Continued)
- 29 -

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.

20
Share capital
Group and company
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
A Ordinary shares of 0.0001p each
1,000,000
1,000,000
1
1
B Ordinary shares of 0.0001p each
3,000,000
3,000,000
3
3
C Ordinary shares of 0.0001p each
1,000,000
1,000,000
1
1
5,000,000
5,000,000
5
5
2024
2023
2024
2023
Preference share capital
Number
Number
£
£
Issued and fully paid
A1 Preferred Shares of 0.0001p each
181,542
181,542
-
-
A2 Preferred Shares of 0.0001p each
967,252
967,252
1
1
A2 Preferred Shares of 0.0001p each
1,138,786
1,138,786
1
1
2,287,580
2,287,580
2
2
Preference shares classified as equity
2
2
Total equity share capital
7
7
21
Other reserve

Foreign currency reserves relate to the translation of the results of subsidiaries with a functional currency different to that of the group.

LOMBOK INVESTMENTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 30 -
22
Security

Charges in the year

 

Industrial Lending 1 Sa has a fixed and floating charge created on 8 May 2015 on all present and future patents, trademarks, service marks, trade names, designs, copyrights, inventions, topographical or similar rights, confidential information and know-how and any interest in these rights whether or not registered. This was further updated by a new charge created by a fixed and floating charge created on 25 October 2019 on all property or undertaking of the company.

 

These charges were satisfied in full on 16 March 2023.

 

Amounts under invoice financing under one year are secured by a fixed and floating charge on all property and undertakings of the group by Vicarage Management No 1 Limited.

 

This charge was created on 26 October 2021 and satisfied in full on 25 April 2023.

 

Industrial Lending 1 Sa created on 28 March 2023 on all property or undertaking of the company.

This charge was satisfied in full after the year end on 8 May 2024.

Vicarage Fid Limited created a charge on 11 April 2023, without property by way of fixed charge: 1. All freehold and leasehold properties (whether registered or unregistered) and all commonhold properties, now or in the future (and from time to time) owned by the borrower, or in which the borrower holds an interest (including, but not limited to, the properties specified in schedule 1) in the future; 2. All present and future interests of the borrower not effectively mortgaged or charged under the preceding provisions of this clause in, or over, freehold or leasehold property; 3. All the borrower's present and future patents, trade-marks, service marks, trade names, designs, copyrights, inventions, topographical or similar rights, confidential information and know-how and any interest in any of these rights, whether or not registered, including all applications and rights to apply for registration and all fees, royalties and other rights derived from, or incidental to, these rights. The charge also contains a floating charge which covers all the property or undertaking of the company.

This charge was satisfied in full on 3 July 2023.

White Oak No.6 Limited created a charge on 26 June 2023, The relevant obligor, with full title guarantee in accordance with the law of property (miscellaneous provisions) act 1994 charges in favour of white oak as continuing security for the payment and discharge of the secured obligations: 4.1.2: by way of fixed charge, any real property now or at any time after the date of this deed belonging to any obligor (other than property charged under clause 4.1.1) 4.1.7 by way of fixed charge, all present and future intellectual property rights owned by it; real property (a) as defined in the finance agreement and any freehold, leasehold or other immovable property (including the property specified in part 1 of schedule 2 (if any)); and (b) any buildings, erections, fixtures or fittings from time to time situated on or forming part of such property (including any trade fixtures and fittings); and (c) all related rights. The charge also contains a floating charge which covers all the property or undertaking of the company.

This charge was satisfied in full after the year end on 21 May 2024.

LOMBOK INVESTMENTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 31 -
23
Operating lease commitments
Lessee

At the reporting end date the group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

Group
Company
2024
2023
2024
2023
£
£
£
£
Within one year
258,876
235,000
-
-
Between two and five years
517,758
705,000
-
-
776,634
940,000
-
-
24
Related party transactions
Remuneration of key management personnel

The directors are considered to be the key management personnel of the group.

25
Controlling party

Events during the period:

 

There was no change in the ultimate controlling party, that continued to be Industrial Lending 1 Sa throughout the period. There was also no change to the the ultimate controlling parent, that continued to be Lombok Investments Limited throughout the period.

 

Events after the period end:

 

On 26 April 2024, Lombok Investments limited underwent a share restructure, whereby Sleep Brands Limited now owns more than 75% of the issued share capital in Lombok Investments Limited and is the new ultimate controlling party.

26
Post Balance Sheet Event

On 26 April 2024 Lombok Investments Limited was acquired by Sleep Brands Limited. On this date, Sleep Brands Limited became the ultimate controlling company, and Karolina Fazio, and Gian Fazio, became the ultimate controlling parties. This transaction was on an arm's length basis. Subsequent to the year end the group also undertook an assessment of its overseas subsidiary which resulted in the sale of core machinery and a staff restructuring process.

LOMBOK INVESTMENTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 32 -
27
Cash generated from/(absorbed by) group operations
2024
2023
£
£
Loss for the year after tax
(5,375,714)
(9,454,867)
Adjustments for:
Taxation charged
24,524
5,853
Finance costs
663,794
5,970,222
Investment income
-
0
(2,132)
Amortisation and impairment of intangible assets
40,320
26,100
Depreciation and impairment of tangible fixed assets
153,848
139,094
Movements in working capital:
Decrease/(increase) in stocks
628,033
(607,374)
Decrease/(increase) in debtors
1,861,062
(2,508,007)
Increase/(decrease) in creditors
2,148,989
(17,455,929)
Cash generated from/(absorbed by) operations
144,856
(23,887,040)
28
Analysis of changes in net debt - group
1 February 2023
Cash flows
Market value movements
31 January 2024
£
£
£
£
Cash at bank and in hand
468,625
(288,925)
-
179,700
Borrowings excluding overdrafts
(478,392)
44,136
(434,994)
(869,250)
(9,767)
(244,789)
(434,994)
(689,550)
29
Prior year adjustment

Subsequent to the signing of the financial statements for the year ended 31 January 2023, it came to the attention of the directors that an item of expenditure was overstated by £1,038,961. This amount related to a preference share creditor that should have been released in the year ended 31 January 2023.

 

As a result of this adjustment, both the previously reported creditors due within one year and loss for the year have decreased by £1,038,961. The creditors due within one year has reduced to £6,893,699 (previously - £7,932,660) and the loss for the year has reduced to £9,454,867 (previously - £10,493,828).

 

The previously reported net equity has increased from £163,134 to £1,202,095.

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