Company registration number 06200980 (England and Wales)
THE RED LION HOTEL (HENLEY) LIMITED
FINANCIAL STATEMENTS
FOR THE YEAR ENDED
31 DECEMBER 2023
Century House
Wargrave Road
Henley-on-Thames
Oxfordshire
United Kingdom
RG9 2LT
THE RED LION HOTEL (HENLEY) LIMITED
CONTENTS
Page
Company information
1
Strategic report
2 - 4
Director's report
5 - 6
Independent auditor's report
7 - 10
Statement of comprehensive income
11
Balance sheet
12 - 13
Statement of changes in equity
14
Notes to the financial statements
15 - 28
THE RED LION HOTEL (HENLEY) LIMITED
COMPANY INFORMATION
- 1 -
Director
Mr. T. Hartnoll
Company number
06200980
Registered office
The Relais Henley
Hart Street
Henley-on-Thames
Oxfordshire
RG9 2AR
Auditor
Verallo
Century House
Wargrave Road
Henley-on-Thames
Oxfordshire
United Kingdom
RG9 2LT
THE RED LION HOTEL (HENLEY) LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
The director presents the strategic report for the year ended 31 December 2023.
Fair review of the business
Against the backdrop of continued challenging conditions for the hospitality sector the company performance for the year was fair with a year-on-year turnover increase of 10%, however, with increased cost pressures the operating profit / (loss) was similar to prior year. Food and Beverage revenues had a strong 2nd half of the year as a result of key management actions to re-conceptualise the offering, resulting in a 33% increase year on year. Conversely, accommodation revenues did not perform as well noting continued economic pressures and were flat on prior year with occupancy below expectations offset by some price growth year on year.
Leisure as a segment is impacted by the cost of living crisis as discretionary spend diminishes. To mitigate this, management developed other market segments and made operational changes to the business to accommodate corporate and social meetings and events. This proved to be a successful approach, enabling the business to fill critical midweek periods.
The business undertakes constant review and forecasting of its cost base. The primary costs of the business are payroll and food costs. Both of these have been impacted by inflation significantly. Underlying wage growth was driven by an increase in the national minimum wage and the availability of the workforce. This increase was offset through restructuring the management team and improved controls on the businesses wage growth and labour efficiency.
THE RED LION HOTEL (HENLEY) LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -
Principal risks, uncertainties and management objectives
The business manages exposure to principal risks through its financial risk management objectives.
Revenue risk
Exposure to revenue risk is managed through financial risk management objectives which focus on optimizing the mix between price point and occupancy. Robust revenue management processes are adopted including daily competitor comparisons.
Food and beverage price risk arises from being unable to pass on inflationary rises in the cost of goods to the customer. This is mitigated through daily ordering of foodstuffs based on business levels to minimize waste and by implementing flexible menus.
Credit risk
The business has limited exposure to credit risk as the majority of its business is paid for in advance or at the time of service. Credit risk is managed by limiting customer credit facilities to those companies that meet credit requirements.
Cost base risk
The business is fully compliant with statutory minimum pay regulations and labour costs are managed through careful rota management. Food price inflation has impacted margins. Risk is managed through detailed costing of menus, minimising waste and sourcing the best value products without compromising on quality produce. Better pricing can be obtained from suppliers on advance purchase terms and the business balances the benefit of better pricing against cashflow needs of the time.
Energy cost is the largest non-direct cost. The timing of energy contract renewals is critical as favourable pricing often requires longer commitment periods to energy suppliers. The business closely monitors renewal dates and has set consumption targets and implemented best practice processes to reduce energy consumption.
Liquidity risk
Cashflow is carefully monitored weekly; revenues are received on a cash basis and can be relatively accurately forecasted to align with supplier payments and payroll requirements due.
Development and performance
The outlook for 2024 remains challenging with the persisting economic instability impacting H1. Positive impacts of sales efforts in 2023 to drive more midweek corporate and weekend leisure business are expected to come to fruition with a strong improvement year-on-year anticipated over H2.
Food price inflation reached a record high of 19.1% in March 2023 compared to 2022. During the remainder of 2023 food inflation remained high and continued to rise albeit at a slower rate. Food inflation remains a key factor in managing the cost base despite an easing in key staples.
Together with further reductions in operational cost base, improvements in sales and marketing capability, the Relais Henley’s signature restaurant was rebranded and relaunched by partnering with a well renowned local chef.
Overall the outlook remains challenging; the focus is on ensuring continuous control on the cost base whilst seeking out new and alternative revenue opportunities. Longer term as the leisure segment recovers the business should be well placed to maximise the opportunity and drive profitability.
THE RED LION HOTEL (HENLEY) LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 4 -
Key performance indicators
| | |
| | |
| | |
Accommodation revenue % Turnover | | |
Food and Beverage revenue % Turnover | | |
Administration expense % Turnover | | |
Employee expense % Turnover | | |
Other information and explanations
The business is committed to providing a quality hospitality experience for its guests and the local community by investing in its assets and the team. Opportunities to further promote the success of The Red Lion Hotel (Henley) are assessed regularly and tailored to suit market demand.
Mr. T. Hartnoll
Director
12 March 2025
THE RED LION HOTEL (HENLEY) LIMITED
DIRECTOR'S REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 5 -
The director presents his annual report and financial statements for the year ended 31 December 2023.
Principal activities
The principal activity of the company continued to be that of a hotel.
Results and dividends
The results for the year are set out on page 11.
No ordinary dividends were paid. The director does not recommend payment of a final dividend.
Director
The director who held office during the year and up to the date of signature of the financial statements was as follows:
Ms. G. Leo
(Resigned 29 May 2024)
Mr. T. Hartnoll
Auditor
The auditor, Verallo, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
Statement of director's responsibilities
The director is responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.
Company law requires the director to prepare financial statements for each financial year. Under that law the director has 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 director must not approve the financial statements unless he is satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the director is required to:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The director is responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. He is also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Strategic report
The company has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the company's strategic report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the directors' report. It has done so in respect of the principal risks, uncertainties and management objectives, along with furture developments.
THE RED LION HOTEL (HENLEY) LIMITED
DIRECTOR'S REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 6 -
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 company’s auditor 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 company’s auditor is aware of that information.
Going concern
The parent company has a Eurobond with an unsecured loan balance of £30million repayable by 2045, which can be drawn upon to support the company.
On behalf of the board
Mr. T. Hartnoll
Director
12 March 2025
THE RED LION HOTEL (HENLEY) LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF THE RED LION HOTEL (HENLEY) LIMITED
- 7 -
Opinion
We have audited the financial statements of The Red Lion Hotel (Henley) Limited (the 'company') for the year ended 31 December 2023 which comprise the statement of comprehensive income, the balance sheet, the statement of changes in equity 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:
give a true and fair view of the state of the company's affairs as at 31 December 2023 and of its loss for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.
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 opinion.
The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The director is 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:
the information given in the strategic report and the director's report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the director's report have been prepared in accordance with applicable legal requirements.
THE RED LION HOTEL (HENLEY) LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF THE RED LION HOTEL (HENLEY) LIMITED
- 8 -
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the director's report. We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
Responsibilities of director
As explained more fully in the director's responsibilities statement, the director is 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 director determines 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 director is 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 director either intends to liquidate the company or to cease operations, or has no realistic alternative but to do so.
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.
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.
Extent to which the audit was considered capable of detecting irregularities, including fraud
The objectives of our audit, in respect to 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; and to respond appropriately to fraud or suspected fraud identified during the audit. However, the primary responsibility for the prevention and detection of fraud rests with both those charged with governance of the entity and its management.
THE RED LION HOTEL (HENLEY) LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF THE RED LION HOTEL (HENLEY) LIMITED
- 9 -
Our approach was as follows:
We identified areas of laws and regulations that could reasonably be expected to have a material effect on the financial statements from our general commercial and sector experience, and through discussion with the directors and other management (as required by auditing standards), the policies and procedures regarding compliance with laws and regulations;
We considered the legal and regulatory frameworks directly applicable to the financial statements reporting framework (FRS 102 and the Companies Act 2006) and the relevant tax compliance regulations in the UK;
We considered the nature of the industry, the control environment and business performance, including the key drivers for management’s remuneration;
We communicated identified laws and regulations throughout our team and remained alert to any indications of non-compliance throughout the audit;
We considered the procedures and controls that the company has established to address risks identified, or that otherwise prevent, deter and detect fraud; and how senior management monitors those programmes and controls.
Based on this understanding we designed our audit procedures to identify non-compliance with such laws and regulations. Where the risk was considered to be higher, we performed audit procedures to address each identified fraud risk. These procedures included: testing manual journals; reviewing the financial statement disclosures and testing to supporting documentation; performing analytical procedures; and enquiring of management, and were designed to provide reasonable assurance that the financial statements were free from fraud or error.
Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, the further removed non-compliance with laws and regulations (irregularities) is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation. We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditors/audit-assurance/auditor-s-responsibilities-for-the-audit-of-the-fi/description-of-the-auditor%E2%80%99s-responsibilities-for. This description forms part of our auditor’s report.
THE RED LION HOTEL (HENLEY) LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF THE RED LION HOTEL (HENLEY) LIMITED
- 10 -
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.
Michelle Hewitt-Dutton FCCA (Senior Statutory Auditor)
For and on behalf of Verallo
Statutory Auditor
Office: Henley-on-Thames
14 March 2025
THE RED LION HOTEL (HENLEY) LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
- 11 -
2023
2022
Notes
£
£
Turnover
3
2,045,717
1,858,196
Cost of sales
(1,690,517)
(1,685,059)
Gross profit
355,200
173,137
Administrative expenses
(1,694,779)
(1,298,300)
Other operating income
170,057
6,000
Operating loss
4
(1,169,522)
(1,119,163)
Interest receivable and similar income
6
1,586
788
Loss before taxation
(1,167,936)
(1,118,375)
Tax on loss
7
Loss for the financial year
(1,167,936)
(1,118,375)
The notes on pages 15 to 28 form part of these financial statements
THE RED LION HOTEL (HENLEY) LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2023
31 December 2023
- 12 -
2023
2022
Notes
£
£
£
£
Fixed assets
Intangible assets
8
6,825
Tangible assets
9
8,655,292
8,802,948
8,662,117
8,802,948
Current assets
Stocks
10
51,505
49,347
Debtors
11
50,457
156,874
Cash at bank and in hand
56,885
190,238
158,847
396,459
Creditors: amounts falling due within one year
12
(12,041,616)
(11,333,952)
Net current liabilities
(11,882,769)
(10,937,493)
Total assets less current liabilities
(3,220,652)
(2,134,545)
Provisions for liabilities
Provisions
13
81,829
(81,829)
-
Net liabilities
(3,302,481)
(2,134,545)
Capital and reserves
Called up share capital
15
100
100
Profit and loss reserves
(3,302,581)
(2,134,645)
Total equity
(3,302,481)
(2,134,545)
THE RED LION HOTEL (HENLEY) LIMITED
BALANCE SHEET (CONTINUED)
AS AT
31 DECEMBER 2023
31 December 2023
- 13 -
The financial statements were approved by the board of directors and authorised for issue on 12 March 2025 and are signed on its behalf by:
Mr. T. Hartnoll
Director
Company Registration No. 06200980
The notes on pages 15 to 28 form part of these financial statements
THE RED LION HOTEL (HENLEY) LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 14 -
Share capital
Profit and loss reserves
Total
£
£
£
Balance at 1 January 2022
100
(1,016,270)
(1,016,170)
Year ended 31 December 2022:
Loss and total comprehensive income for the year
-
(1,118,375)
(1,118,375)
Balance at 31 December 2022
100
(2,134,645)
(2,134,545)
Year ended 31 December 2023:
Loss and total comprehensive income for the year
-
(1,167,936)
(1,167,936)
Balance at 31 December 2023
100
(3,302,581)
(3,302,481)
The notes on pages 15 to 28 form part of these financial statements
THE RED LION HOTEL (HENLEY) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 15 -
1
Accounting policies
Company information
The Red Lion Hotel (Henley) Limited is a private company limited by shares incorporated in England and Wales, company registration no. 06200980. The registered office is The Relais Henley, Hart Street, Henley-on-Thames, Oxfordshire, RG9 2AR.
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.
This 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:
Section 4 ‘Statement of Financial Position’: Reconciliation of the opening and closing number of shares;
Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;
Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues’: Carrying amounts, interest income/expense and net gains/losses for each category of financial instrument; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;
Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.
The financial statements of the company are consolidated in the financial statements of The Relais Henley Holding Limited. These consolidated financial statements are available from its registered office, Century House, Wargrave Road, Henley-on-Thames, Oxfordshire, United Kingdom, RG9 2LT.
1.2
Going concern
At the balance sheet date the company's current liabilities exceeded its current assets by £true3,220,652 (2022 - £2,134,545), and its total net liabilities equalled £3,302,481 (2022 - £2,134,545). The director has prepared the financial statements on a going concern basis, which assumes the company will continue in operational existence, and will be able to meet its liabilities as they fall due, for a period of at least twelve months from the date of approval of the financial statements.
In reaching this conclusion, the director has reviewed the budgets and forecasts for the foreseeable future and has considered the support obtained from the group's parent company.
The director continues to review the impact of economy on the operations and financial position of the company.
THE RED LION HOTEL (HENLEY) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 16 -
1.3
Turnover
Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes.
Sale of accommodation
The contract to provide accommodation is established when the customer books accommodation. The performance obligation is the right to use accommodation for a given number of nights, and the transaction price is the room rate for each night determined at the time of the booking. The performance obligation is met when the customer is given the right to use the accommodation, and so revenue is recognised for each night as it takes place, at the room rate for that night.
Customers may pay in advance for accommodation. In this case the Company has received consideration for services not yet provided. This is treated as a contract liability until the performance obligation is met.
Sale of food and beverage
The contract is established when the customer orders the food or drink item and the performance obligation is the provision of food and drink by the outlet. The performance obligation is satisfied when the food and drink is delivered to the customer, and revenue is recognised at this point at the price for the items purchased.
1.4
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.
1.5
Intangible fixed assets - goodwill
Goodwill represents the excess of the cost of acquisition of unincorporated businesses over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is 20 years.
For the purposes of impairment testing, goodwill is allocated to the cash-generating units expected to benefit from the acquisition. Cash-generating units to which goodwill has been allocated are tested for impairment at least annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit.
1.6
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.
THE RED LION HOTEL (HENLEY) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 17 -
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:
Website costs
Not amortised
1.7
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:
Freehold buildings
2% straight line
Leasehold improvements
Over life of lease
Fixtures and fittings
10% - 20% straight line
Computer equipment
20% straight line
Land is not subject to depreciation.
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 credited or charged to profit or loss.
1.8
Impairment of fixed assets
At each reporting period end date, the company 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.
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.
THE RED LION HOTEL (HENLEY) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 18 -
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.
1.9
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.
1.10
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.
1.11
Financial instruments
The company 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 company's balance sheet when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include 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.
THE RED LION HOTEL (HENLEY) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 19 -
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.
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 company 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 company after deducting all of its liabilities.
Basic financial liabilities
Basic financial liabilities, including creditors, bank loans, and loans from fellow group companies, 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.
THE RED LION HOTEL (HENLEY) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 20 -
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 company’s contractual obligations expire or are discharged or cancelled.
1.12
Equity instruments
Equity instruments issued by the company 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 company.
1.13
Provisions
Provisions are recognised when the company has a legal or constructive present obligation as a result of a past event, it is probable that the company will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.
The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the reporting end date, taking into account the risks and uncertainties surrounding the obligation. Where the effect of the time value of money is material, the amount expected to be required to settle the obligation is recognised at present value. When a provision is measured at present value, the unwinding of the discount is recognised as a finance cost in profit or loss in the period in which it arises.
1.14
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.
1.15
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
THE RED LION HOTEL (HENLEY) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 21 -
1.16
Government grants
Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.
A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.
2
Judgements and key sources of estimation uncertainty
In the application of the company’s accounting policies, the director is 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.
Key sources of estimation uncertainty
The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.
Depreciation
On acquisition all of the fixed assets were disposed of apart from the land and building. Fixed assets purchased since acquisition were bought and deprecated using new depreciation rates. The effect of the change in accounting estimate has not been disclosed as all of the fixed assets that were depreciated using the original estimate have been disposed of and all of the purchased assets use the new estimate.
3
Turnover and other revenue
2023
2022
£
£
Turnover analysed by class of business
Accomodation
1,233,595
1,233,141
Food and beverage
793,453
594,442
Other
18,669
30,613
2,045,717
1,858,196
THE RED LION HOTEL (HENLEY) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
3
Turnover and other revenue
(Continued)
- 22 -
2023
2022
£
£
Other revenue
Interest income
1,586
788
Grants received
-
6,000
4
Operating loss
2023
2022
Operating loss for the year is stated after charging/(crediting):
£
£
Exchange losses
6
128
Government grants
-
(6,000)
Fees payable to the company's auditor for the audit of the company's financial statements
11,000
21,000
Depreciation of owned tangible fixed assets
257,456
224,263
Profit on disposal of tangible fixed assets
(6,144)
(68)
5
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Directors
2
2
Admin
14
10
Food and beverage
32
46
Housekeeping
11
15
Total
59
73
THE RED LION HOTEL (HENLEY) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
5
Employees
(Continued)
- 23 -
Their aggregate remuneration comprised:
2023
2022
£
£
Wages and salaries
1,331,349
1,108,737
Social security costs
128,332
98,698
Pension costs
21,995
18,009
1,481,676
1,225,444
6
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
527
788
Other interest income
1,059
Total income
1,586
788
7
Taxation
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:
2023
2022
£
£
Loss before taxation
(1,167,936)
(1,118,375)
Expected tax credit based on the standard rate of corporation tax in the UK of 25.00% (2022: 19.00%)
(291,984)
(212,491)
Tax effect of expenses that are not deductible in determining taxable profit
20,816
1,561
Unutilised tax losses carried forward
278,710
210,930
Change in unrecognised deferred tax assets
(17,991)
Depreciation on assets not qualifying for tax allowances
10,576
Super deduction
18
Super-deduction
(145)
Taxation charge for the year
-
-
THE RED LION HOTEL (HENLEY) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
7
Taxation
(Continued)
- 24 -
At 31 December 2023 the trading company had tax losses amounting to £5,261,330 (2022 - £4,064,664), of which £2,593,017 (2022 - £2,521,055) has been utilised to offset the deferred tax liability of £648,254 (2022 - £630,264) in relation to accelerated capital allowances. A balance of £2,668,313 (2022 - £1,543,609) remains available to be carried forward and offset against future trading profits.
8
Intangible fixed assets
Goodwill
Website costs
Total
£
£
£
Cost
At 1 January 2023
450,000
450,000
Additions
6,825
6,825
At 31 December 2023
450,000
6,825
456,825
Amortisation and impairment
At 1 January 2023 and 31 December 2023
450,000
450,000
Carrying amount
At 31 December 2023
6,825
6,825
At 31 December 2022
THE RED LION HOTEL (HENLEY) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 25 -
9
Tangible fixed assets
Freehold land and buildings
Leasehold improvements
Fixtures and fittings
Computer equipment
Total
£
£
£
£
£
Cost
At 1 January 2023
8,895,320
17,220
669,632
105,446
9,687,618
Additions
53,931
56,427
6,010
116,368
Disposals
(17,220)
(12,712)
(29,932)
At 31 December 2023
8,949,251
726,059
98,744
9,774,054
Depreciation and impairment
At 1 January 2023
732,043
4,626
120,179
27,822
884,670
Depreciation charged in the year
131,377
12,594
91,573
21,912
257,456
Eliminated in respect of disposals
(17,220)
(6,144)
(23,364)
At 31 December 2023
863,420
211,752
43,590
1,118,762
Carrying amount
At 31 December 2023
8,085,831
514,307
55,154
8,655,292
At 31 December 2022
8,163,277
12,594
549,453
77,624
8,802,948
The carrying value of land and buildings comprises of land valued at £2,348,101.
10
Stocks
2023
2022
£
£
Finished goods and goods for resale
51,505
49,347
11
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
15,546
3,721
Corporation tax recoverable
92,790
Other debtors
25,935
51,504
Prepayments and accrued income
8,976
8,859
50,457
156,874
THE RED LION HOTEL (HENLEY) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 26 -
12
Creditors: amounts falling due within one year
2023
2022
£
£
Trade creditors
121,265
116,873
Amounts owed to group undertakings
11,208,146
10,331,803
Taxation and social security
127,412
25,804
Other creditors
356,716
317,124
Accruals and deferred income
228,077
542,348
12,041,616
11,333,952
The amounts owed to group undertakings are not subject to interest, repayment is due at the request of the parent.
13
Provisions for liabilities
2023
2022
£
£
81,829
-
Movements on provisions:
£
At 1 January 2023 and 31 December 2023
81,829
The provision represents expected repairs and maintenance costs of the building to be settled within the next 12 months. The basis has been applied at 4% of turnover, which the directors believe represents the value to repair the property to its current condition.
14
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
21,995
18,009
The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.
THE RED LION HOTEL (HENLEY) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 27 -
15
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
100
100
100
100
16
Operating lease commitments
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
2023
2022
£
£
Within one year
71,862
44,967
Between two and five years
62,336
52,166
134,198
97,133
17
Related party transactions
The company has taken advantage of the exemption allowed under FRS 102 s.33 1A not to disclose transactions with wholly owned members of the group.
During the year, the company traded with a company related by mutual control. The company loaned an additional £457,782 (2022 - £148,839) and repayments made totalled £449,075 (2022 - £66,496). At the year end £287,473 (2022 - £278,766) remained outstanding. The monies are repayable on request, and are not subject to interest.
18
Directors' transactions
During the period, the company had transactions of £80,000 (2022 - £80,000) with a director as a result of management fees. At the balance sheet date, the total owed amounted to £113,333 (2022 - £113,333) in accruals. No interest is charged on the balance.
THE RED LION HOTEL (HENLEY) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 28 -
19
Ultimate controlling party
The immediate parent company is The Relais Henley Holding Limited, a company incorporated in the United kingdom.
The intermediate parent company is The Relais Retreats Limited, a company incorporated in the British Virgin Islands.
At the year end Mr T. Hartnoll was the ultimate controlling party by virtue of his majority shareholding in The Relais Retreats Limited.
On 24 May 2024 Baccata Trustees Ltd, a company incorporated in the Jersey, Channel Islands, became the ultimate parent company.
The ultimate controlling party from 24 May 2024 is Mr N. Falla, by virtue of his controlling interest in Baccata Trustees Ltd.
The Red Lion Hotel (Henley) Limited is included within the consolidated financial statements of The Relais Henley Holding Limited, which can be obtained from the registered office; Century House, Wargrave Road, Henely-on Thames, Oxfordshire, England, RG9 2LT.
2023-12-312023-01-01falseCCH SoftwareCCH Accounts Production 2024.210Ms. G. LeoMr. T. Hartnollfalsefalse062009802023-01-012023-12-3106200980bus:Director22023-01-012023-12-3106200980bus:Director12023-01-012023-12-3106200980bus:RegisteredOffice2023-01-012023-12-31062009802023-12-31062009802022-01-012022-12-3106200980core:RetainedEarningsAccumulatedLosses2022-01-012022-12-3106200980core:RetainedEarningsAccumulatedLosses2023-01-012023-12-3106200980core:OtherResidualIntangibleAssets2023-12-3106200980core:OtherResidualIntangibleAssets2022-12-3106200980core:Goodwill2023-12-3106200980core:DevelopmentCostsCapitalisedDevelopmentExpenditure2023-12-3106200980core:Goodwill2022-12-3106200980core:DevelopmentCostsCapitalisedDevelopmentExpenditure2022-12-31062009802022-12-3106200980core:LandBuildingscore:OwnedOrFreeholdAssets2023-12-3106200980core:LeaseholdImprovements2023-12-3106200980core:FurnitureFittings2023-12-3106200980core:ComputerEquipment2023-12-3106200980core:LandBuildingscore:OwnedOrFreeholdAssets2022-12-3106200980core:LeaseholdImprovements2022-12-3106200980core:FurnitureFittings2022-12-3106200980core:ComputerEquipment2022-12-3106200980core:CurrentFinancialInstrumentscore:WithinOneYear2023-12-3106200980core:CurrentFinancialInstrumentscore:WithinOneYear2022-12-3106200980core:ShareCapital2023-12-3106200980core:ShareCapital2022-12-3106200980core:RetainedEarningsAccumulatedLosses2023-12-3106200980core:RetainedEarningsAccumulatedLosses2022-12-3106200980core:ShareCapital2021-12-3106200980core:RetainedEarningsAccumulatedLosses2021-12-31062009802021-12-3106200980core:Goodwill2023-01-012023-12-3106200980core:IntangibleAssetsOtherThanGoodwill2023-01-012023-12-3106200980core:DevelopmentCostsCapitalisedDevelopmentExpenditure2023-01-012023-12-3106200980core:LandBuildingscore:OwnedOrFreeholdAssets2023-01-012023-12-3106200980core:LeaseholdImprovements2023-01-012023-12-3106200980core:FurnitureFittings2023-01-012023-12-3106200980core:ComputerEquipment2023-01-012023-12-3106200980core:UKTax2023-01-012023-12-3106200980core:UKTax2022-01-012022-12-310620098012023-01-012023-12-310620098012022-01-012022-12-310620098022023-01-012023-12-310620098022022-01-012022-12-310620098032023-01-012023-12-310620098032022-01-012022-12-3106200980core:Goodwill2022-12-3106200980core:DevelopmentCostsCapitalisedDevelopmentExpenditure2022-12-31062009802022-12-3106200980core:Goodwillcore:ExternallyAcquiredIntangibleAssets2023-01-012023-12-3106200980core:DevelopmentCostsCapitalisedDevelopmentExpenditurecore:ExternallyAcquiredIntangibleAssets2023-01-012023-12-3106200980core:ExternallyAcquiredIntangibleAssets2023-01-012023-12-3106200980core:LandBuildingscore:OwnedOrFreeholdAssets2022-12-3106200980core:LeaseholdImprovements2022-12-3106200980core:FurnitureFittings2022-12-3106200980core:ComputerEquipment2022-12-3106200980core:CurrentFinancialInstruments2023-12-3106200980core:CurrentFinancialInstruments2022-12-3106200980core:WithinOneYear2023-12-3106200980core:WithinOneYear2022-12-3106200980core:BetweenTwoFiveYears2023-12-3106200980core:BetweenTwoFiveYears2022-12-3106200980bus:PrivateLimitedCompanyLtd2023-01-012023-12-3106200980bus:FRS1022023-01-012023-12-3106200980bus:Audited2023-01-012023-12-3106200980bus:FullAccounts2023-01-012023-12-31xbrli:purexbrli:sharesiso4217:GBP