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Registration number: 03389199

Scarlets Regional Limited

Annual Report and Financial Statements

for the Year Ended 30 June 2024

 

Scarlets Regional Limited

Contents

Company Information

1

Strategic Report

2 to 3

Directors' Report

4 to 5

Statement of Directors' Responsibilities

6

Independent Auditor's Report

7 to 10

Profit and Loss Account

11

Balance Sheet

12

Statement of Changes in Equity

13

Statement of Cash Flows

14

Notes to the Financial Statements

15 to 30

 

Scarlets Regional Limited

Company Information

Chairman
and director

Mr S W Muderack

Directors

Mr D L Quinnell

Mr P J Morgan

Mr D B Jones

Mr P J Davies

Mr S B T Fitzpatrick

Mr H D Evans

Mr G H Wise

Mr E W Evans

Mr D Owen

Ms A L Antoniazzi

Mr O G R Jones

Mr J D Daniels

Mr R H S J B Moon

Mr N V Short

Company secretary

Mr P J Morgan

Registered office

Parc y Scarlets
Pemberton Regional Park
Trostre Roundabout
Llanelli
SA14 9UZ

Auditors

LHP Auditors Ltd
Llys Deri
Parc Pensarn
Carmarthen
SA31 2NF

 

Scarlets Regional Limited

Strategic Report for the Year Ended 30 June 2024

The directors present their strategic report for the year ended 30 June 2024.

Principal activity

The principal activity of the company is running the of the Scarlets RFC and other associated rugby activities.

Fair review of the business

The 2023/2024 season was challenging in many ways for the club. Finishing 13th in the BKT United Rugby Championship fell short of our objectives and ambitions. Our goal is to consistently compete for knockout rugby, and last season’s campaign did not meet those expectations. Injuries played a significant role in our struggles, with an extensive injury list that included long-term setbacks to key senior players, further impacting an already reduced squad.

Despite the challenges, there were notable highlights. It was fantastic to see our homegrown players—Joe Roberts, Kemsley Mathias, and Eddie James—earn their first Wales caps, alongside new signings Taine Plumtree and Harri O’Connor. We are immensely proud to have had six of our players selected for Wales' summer tour of Australia.

As is the nature of professional sport, each season brings changes to the squad. Last season, we said farewell to several Scarlets legends, including our former captain, Wales and British & Irish Lions hooker Ken Owens, who was forced to retire due to injury. Another Lions great, Jonathan ‘Fox’ Davies, also retired at the end of the season. Both players will be remembered as two of the greats of Welsh rugby. Additionally, we bid farewell to club stalwarts who made over a century of appearances for the Scarlets—Scott Williams, Wyn Jones, Dan Jones, Kieran Hardy, Jonny McNicholl, and Samson Lee, the latter retiring mid-season due to a long-standing Achilles injury. We are profoundly grateful for their commitment, dedication, and the cherished memories they have given us over the years.

I would like to extend my sincere thanks to our dedicated staff, who have gone above and beyond in often challenging circumstances, taking on multiple roles with unwavering commitment. A heartfelt thank you also to our sponsors and business partners, whose loyalty has been invaluable, particularly over the past few years. And, of course, a massive thank you to our debenture holders, season ticket holders, supporters, and fans—you are truly appreciated.

Finally, on behalf of everyone at the club, I would like to express our deepest gratitude to our directors and benefactors. Their continued financial support and belief in the Scarlets have provided stability, without which the club simply could not continue to operate.

The company's key financial and other performance indicators during the year were as follows:

Financial KPIs

Unit

2024

2023

Turnover

£

11,340,592

12,796,767

WRU income

£

5,514,401

6,719,741

Competition income

£

2,009,100

2,308,750

Gross (loss)/profit

%

34

32

Net (loss)/profit

£

(2,590,064)

(2,911,781)

Net assets/(liabilities)

£

(6,180,917)

(4,296,216)

Other key performance indicators
The company also monitors its performance by our league position in the United Rugby Championship and our progression in the European Competition.

 

Scarlets Regional Limited

Strategic Report for the Year Ended 30 June 2024

Principal risks and uncertainties

Financial risk management objectives and policies
The company operates a number of risk management policies designed to minimise its exposure to financial risk.

Liquidity and cash flow risk
The company produces detailed management accounts and forecasts, which enable the Directors to monitor the cash position and to ensure that there is sufficient liquidity and cash flow to minimise the risk of the company being unable to pay its debts as they fall due. The company utilises loans to finance its operations. The continued availability of these debt facilities is crucial to the future prospects of the company. Borrowings at variable rates expose the company to interest rate risk, however the directors actively manage this risk by monitoring cash-flow to ensure such borrowings are minimised.

Credit risk
Given the nature of the business the company does not consider that it faces any significant credit risk.

Price risk
The company actively manages price risk by agreeing terms with suppliers prior to entering into any transactions with customers.

Approved and authorised by the Board on 27 March 2025 and signed on its behalf by:
 

.........................................
Mr S W Muderack
Chairman

 

Scarlets Regional Limited

Directors' Report for the Year Ended 30 June 2024

The directors present their report and the financial statements for the year ended 30 June 2024.

Directors of the company

The directors who held office during the year were as follows:

Mr S W Muderack - Chairman

Mr D L Quinnell (appointed 20 July 2023)

Mr P J Morgan - Company secretary and director

Mr D B Jones

Mr R A Cammish (ceased 30 June 2024)

Mr P J Davies

Mr S B T Fitzpatrick

Mr H D Evans

Mr G H Wise

Mr E W Evans

Mr D Owen

Ms A L Antoniazzi (appointed 15 May 2024)

Mr O G R Jones

Mr J D Daniels

Mr G Jenkins (ceased 30 June 2024)

Mr R H S J B Moon

Mr N V Short

Employment of disabled persons

It is the company's employment policy to treat all its employees fairly and ensure equal opportunity for all regardless of gender, ethnic origin, age, disability, or religion.

Future developments

The directors aim to improve performance both on and off the field and work in conjunction with the WRU to restructure the debts raised during Covid and collectively build revenue streams throughout the game.

Going concern

For the year ended 30 June 2024, the company suffered a loss of £2,590,064 with net current liabilities of £4,347,721 and net liabilities of £6,180,917 at 30 June 2024.

During the year-ending June 2025, we have worked with the WRU on a new funding agreement that will relieve regional clubs of a substantial portion of the Covid-related debt that has previously burdened us, alongside a more sustainable funding model that provides greater long-term financial certainty.

 

Scarlets Regional Limited

Directors' Report for the Year Ended 30 June 2024

Disclosure of information to the auditors

Each director has taken steps that they ought to have taken as a director in order to make themselves aware of any relevant audit information and to establish that the company's auditors are aware of that information. The directors confirm that there is no relevant information that they know of and of which they know the auditors are unaware.

Reappointment of auditors

The auditors LHP Auditors Ltd are deemed to be reappointed under section 487(2) of the Companies Act 2006.

Approved and authorised by the Board on 27 March 2025 and signed on its behalf by:
 

.........................................
Mr S W Muderack
Chairman

 

Scarlets Regional Limited

Statement of Directors' Responsibilities

The directors acknowledge their responsibilities 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 company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:

select suitable accounting policies and apply them consistently;

make judgements and accounting estimates that are reasonable and prudent;

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

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

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

 

Scarlets Regional Limited

Independent Auditor's Report to the Members of Scarlets Regional Limited

Opinion

We have audited the financial statements of Scarlets Regional Limited (the 'company') for the year ended 30 June 2024, which comprise the Profit and Loss Account, Balance Sheet, Statement of Changes in Equity, Statement of Cash Flows, and Notes to the Financial Statements, including a summary of 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 30 June 2024 and of its loss for the year then ended;

have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the auditor 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.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the director's use of the going concern basis of accounting in the preparation of the financial statements is appropriate. .

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the original financial statements were 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.

Other information

The directors are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. 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.

In connection with our audit of the financial statements, 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 audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. 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.

 

Scarlets Regional Limited

Independent Auditor's Report to the Members of Scarlets Regional Limited

Opinion on other matters prescribed by the Companies Act 2006

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

the information given in the Strategic Report and Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

the Strategic Report and Directors' Report have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In the light of our 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 and the Directors' Report.

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

adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or

the financial statements are not in agreement with the accounting records and returns; or

certain disclosures of directors' remuneration specified by law are not made; or

we have not received all the information and explanations we require for our audit.

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities [set out on page 6], 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.

Auditor 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 our procedures are capable of detecting irregularities, including fraud is detailed below:

 

Scarlets Regional Limited

Independent Auditor's Report to the Members of Scarlets Regional Limited

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above and on the Financial Reporting Council’s website, to detect material misstatements in respect of irregularities, including fraud.

We obtain and update our understanding of the entity, its activities, its control environment, and likely future developments, including in relation to the legal and regulatory framework applicable and how the entity is complying with that framework. Based on this understanding, we identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. This includes consideration of the risk of acts by the entity that were contrary to applicable laws and regulations, including fraud.

In response to the risk of irregularities and non-compliance with laws and regulations, including fraud, we designed procedures which included:

Enquiry of management and those charged with governance around actual and potential litigation and claims as well as actual, suspected and alleged fraud;

Reviewing minutes of meetings of those charged with governance;

Assessing the extent of compliance with the laws and regulations considered to have a direct material effect on the financial statements or the operation of the entity through enquiry and inspection;

Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations;

Performing audit work over the risk of management bias and override of controls, including testing of journal entries and other adjustments for appropriateness, evaluating the business rationale of significant transactions outside the normal course of business and reviewing accounting estimates for indicators of potential bias.

 

Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls.

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

 

Scarlets Regional Limited

Independent Auditor's Report to the Members of Scarlets Regional Limited

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.

......................................
Matthew Williams (Senior Statutory Auditor)
For and on behalf of LHP Auditors Ltd, Statutory Auditor

Llys Deri
Parc Pensarn
Carmarthen
SA31 2NF

28 March 2025

 

Scarlets Regional Limited

Profit and Loss Account for the Year Ended 30 June 2024

Note

2024
£

2023
£

Turnover

3

11,340,592

12,796,767

Cost of sales

 

(7,487,433)

(8,696,783)

Gross profit

 

3,853,159

4,099,984

Administrative expenses

 

(5,717,867)

(6,771,528)

Other operating income

4

60,997

39,904

Operating loss

5

(1,803,711)

(2,631,640)

Other interest receivable and similar income

6

43,359

9,916

Interest payable and similar expenses

7

(977,146)

(394,531)

   

(933,787)

(384,615)

Loss before tax

 

(2,737,498)

(3,016,255)

Tax on loss

11

147,434

104,474

Loss for the financial year

 

(2,590,064)

(2,911,781)

The above results were derived from continuing operations.

The company has no recognised gains or losses for the year other than the results above.

 

Scarlets Regional Limited

(Registration number: 03389199)
Balance Sheet as at 30 June 2024

Note

2024
£

2023
£

Fixed assets

 

Tangible assets

12

8,410,883

8,787,457

Investments

13

100

100

Other financial assets

14

14,300

14,300

 

8,425,283

8,801,857

Current assets

 

Stocks

15

30,579

30,345

Debtors

16

496,633

607,220

Cash at bank and in hand

 

168,338

306,238

 

695,550

943,803

Creditors: Amounts falling due within one year

17

(4,347,721)

(5,836,250)

Net current liabilities

 

(3,652,171)

(4,892,447)

Total assets less current liabilities

 

4,773,112

3,909,410

Creditors: Amounts falling due after more than one year

17

(10,954,029)

(8,205,626)

Net liabilities

 

(6,180,917)

(4,296,216)

Capital and reserves

 

Called up share capital

13,007,480

12,208,137

Other reserves

134,707

228,687

Retained earnings

(19,323,104)

(16,733,040)

Shareholders' deficit

 

(6,180,917)

(4,296,216)

Approved and authorised by the Board on 27 March 2025 and signed on its behalf by:
 

.........................................
Mr S W Muderack
Chairman

 

Scarlets Regional Limited

Statement of Changes in Equity for the Year Ended 30 June 2024

Share capital
£

Other reserves
£

Retained earnings
£

Total
£

At 1 July 2023

12,208,137

228,687

(16,733,040)

(4,296,216)

Loss for the year

-

-

(2,590,064)

(2,590,064)

New share capital subscribed

799,343

-

-

799,343

Other movements on reserves

-

(93,980)

-

(93,980)

At 30 June 2024

13,007,480

134,707

(19,323,104)

(6,180,917)

Share capital
£

Other reserves
£

Retained earnings
£

Total
£

At 1 July 2022

12,208,137

184,371

(13,821,259)

(1,428,751)

Loss for the year

-

-

(2,911,781)

(2,911,781)

Other movements on reserves

-

44,316

-

44,316

At 30 June 2023

12,208,137

228,687

(16,733,040)

(4,296,216)

 

Scarlets Regional Limited

Statement of Cash Flows for the Year Ended 30 June 2024

Note

2024
£

2023
£

Cash flows from operating activities

Loss for the year

 

(2,590,064)

(2,911,781)

Adjustments to cash flows from non-cash items

 

Depreciation and amortisation

5

410,397

455,053

Financial instrument net gains (losses) through profit and loss

 

(93,980)

44,318

Loss on disposal of tangible assets

-

29,238

Finance income

6

(43,359)

(9,916)

Finance costs

7

977,146

394,531

Income tax expense

11

(147,434)

(104,474)

 

(1,487,294)

(2,103,031)

Working capital adjustments

 

(Increase)/decrease in stocks

15

(234)

4,930

Decrease in trade debtors

16

110,587

279,672

Decrease in trade creditors

17

(111,263)

(46,278)

(Decrease)/increase in deferred income, including government grants

 

(764,654)

1,384,748

Cash generated from operations

 

(2,252,858)

(479,959)

Income taxes received

11

147,434

104,474

Net cash flow from operating activities

 

(2,105,424)

(375,485)

Cash flows from investing activities

 

Interest received

6

43,359

9,916

Acquisitions of tangible assets

(33,823)

(172,456)

Proceeds from sale of tangible assets

 

-

65,000

Net cash flows from investing activities

 

9,536

(97,540)

Cash flows from financing activities

 

Interest paid

7

(977,146)

(394,531)

Proceeds from issue of ordinary shares, net of issue costs

 

799,343

-

Proceeds from other borrowing draw downs

 

3,750,000

-

Repayment of other borrowing

 

(1,577,855)

(544,962)

Payments to finance lease creditors

 

(36,354)

(37,844)

Net cash flows from financing activities

 

1,957,988

(977,337)

Net decrease in cash and cash equivalents

 

(137,900)

(1,450,362)

Cash and cash equivalents at 1 July

 

306,238

1,756,600

Cash and cash equivalents at 30 June

 

168,338

306,238

 

Scarlets Regional Limited

Notes to the Financial Statements for the Year Ended 30 June 2024

1

General information

The company is a private company limited by share capital, incorporated in England and Wales.

The address of its registered office is:
Parc y Scarlets
Pemberton Regional Park
Trostre Roundabout
Llanelli
SA14 9UZ

These financial statements were authorised for issue by the Board on 27 March 2025.

2

Accounting policies

Summary of significant accounting policies and key accounting estimates

The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

Statement of compliance

These financial statements were prepared in accordance with Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland and the Companies Act 2006'.

Basis of preparation

These financial statements have been prepared using the historical cost convention except that as disclosed in the accounting policies certain items are shown at fair value.

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

Group accounts not prepared

The company has not prepared consolidated financial statements as permitted by section 9 of FRS 102. The subsidiary, Llanelli RFC, is a dormant entity and its inclusion is not material for the purpose of giving a true and fair view. Therefore, in accordance with FRS 102, Section 9.3, it has not been consolidated into these financial statements.

 

Scarlets Regional Limited

Notes to the Financial Statements for the Year Ended 30 June 2024

2

Accounting policies (continued)

Going concern

The company recorded a net loss of £2,590,064 for the year ended 30 June 2024 (2023 : loss of £2,911,781) and as at the balance sheet date, the company had excess net liabilities of £6,180,917 (2023: £4,296,216). The company remains reliant upon the support of the WRU, its various funders and the ongoing support and goodwill of its supporters, sponsors, directors and shareholders.

A new Professional Rugby Agreement has been agreed in principle with the WRU which will relieve a substantial portion of the Covid-related debt that has burdened the company, alongside a more sustainable funding model that provides greater long-term financial certainty.

The directors have prepared cash flow forecasts for a period of 12 months from the date of approval of these financial statements. The forecasts indicate the company will have sufficient funds to meet its liabilities as they fall due for a period of at least 12 months from the approval of the accounts.

Therefore, the directors consider it appropriate to prepare the financial statements on a going concern basis and therefore the financial statements do not reflect the adjustments that would have been made should continuing finance not be made available, namely reducing the value of the assets to their realisable amounts, providing for any further liabilities which might arise and reclassifying all fixed assets and long term liabilities as current assets and liabilities respectively.

Revenue recognition

Turnover represents amounts invoiced, excluding value added tax, in respect of the sale of goods and services. Ticket income, hospitality income and income from competitions are recognised as revenue when the respective event takes place. Revenue from commercial contracts - including broadcasting revenue, sponsorship and the lease of hospitality boxes is recognised based on the terms of the contract as and when the services are delivered.

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

Government grants

Government grants are recognised at 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 is satisfied it is recognised as a liability.

Tax

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

 

Scarlets Regional Limited

Notes to the Financial Statements for the Year Ended 30 June 2024

2

Accounting policies (continued)

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

Tangible assets

Tangible assets are stated in the balance sheet at cost, less any subsequent accumulated depreciation and subsequent accumulated impairment losses.

The cost of tangible assets includes directly attributable incremental costs incurred in their acquisition and installation.

Depreciation

Depreciation is charged so as to write off the cost or valuation of assets, other than land and properties under construction over their estimated useful lives, as follows:

Asset class

Depreciation method and rate

Buildings

2% - Straight line

Plant and machinery

Varying from 9% to 20% - Straight line

Heritage Trail

20% - Straight line

Impairment of fixed assets

At each reporting period end date, the company reviews the carrying amounts of its tangible 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.

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

 

Scarlets Regional Limited

Notes to the Financial Statements for the Year Ended 30 June 2024

2

Accounting policies (continued)

Cash and cash equivalents

Cash and cash equivalents comprise cash on hand and call deposits, and other short-term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of change in value.

Trade debtors

Trade debtors are amounts due from customers for merchandise sold or services performed in the ordinary course of business.

Trade debtors are recognised initially at the transaction price. They are subsequently measured at amortised cost using the effective interest method, less provision for impairment. A provision for the impairment of trade debtors is established when there is objective evidence that the company will not be able to collect all amounts due according to the original terms of the receivables.

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 stock to their present location and condition.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stock 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.

Trade creditors

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if the company does not have an unconditional right, at the end of the reporting period, to defer settlement of the creditor for at least twelve months after the reporting date. If there is an unconditional right to defer settlement for at least twelve months after the reporting date, they are presented as non-current liabilities.

Trade creditors are recognised initially at the transaction price and subsequently measured at amortised cost using the effective interest method.

Borrowings

Interest-bearing borrowings are initially recorded at fair value, net of transaction costs. Interest-bearing borrowings are subsequently carried at amortised cost, with the difference between the proceeds, net of transaction costs, and the amount due on redemption being recognised as a charge to the profit and loss account over the period of the relevant borrowing.

Interest expense is recognised on the basis of the effective interest method and is included in interest payable and similar charges.

Borrowings are classified as current liabilities unless the company has an unconditional right to defer settlement of the liability for at least twelve months after the reporting date.

 

Scarlets Regional Limited

Notes to the Financial Statements for the Year Ended 30 June 2024

2

Accounting policies (continued)

Leases

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

Assets held under finance leases are recognised at the lower of their fair value at inception of the lease and the present value of the minimum lease payments. These assets are depreciated on a straight-line basis over the shorter of the useful life of the asset and the lease term. The corresponding liability to the lessor is included in the balance sheet as a finance lease obligation.

Lease payments are apportioned between finance costs in the profit and loss account and reduction of the lease obligation so as to achieve a constant periodic rate of interest on the remaining balance of the liability.

Share capital

Ordinary shares are classified as equity. Equity instruments are measured at the fair value of the cash or other resources received or receivable, net of the direct costs of issuing the equity instruments. If payment is deferred and the time value of money is material, the initial measurement is on a present value basis.

Defined contribution pension obligation

A defined contribution plan is a pension plan under which fixed contributions are paid into a pension fund and the company has no legal or constructive obligation to pay further contributions even if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods.

Contributions to defined contribution plans are recognised as employee benefit expense when they are due. If contribution payments exceed the contribution due for service, the excess is recognised as a prepayment.

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.

Transfer fees

Fees payable to and receivable from other rugby football clubs on the transfer of a player's registration, together with associated costs, are dealt with through the profit and loss account in the accounting year in which the transfer of the player's registration takes place.

 

Scarlets Regional Limited

Notes to the Financial Statements for the Year Ended 30 June 2024

2

Accounting policies (continued)

Judgements

In the application of the company's accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying value of the 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 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

Stadium carrying value
The trading conditions, along with the other matters explained in the accounting policies to the financial statements, indicate the uncertainty with regards the director’s estimation to the carrying value of the stadium. The stadium is currently carried at cost less accumulated depreciation and any previous provisions for impairment. The carrying amount is £7,607,960 (2023 -£7,830,267).

3

Turnover

The analysis of the company's Turnover for the year by class of business is as follows:

2024
£

2023
£

Membership Subscriptions

437,796

510,460

WRU Receipts

5,514,401

6,719,740

Sponsorships

1,556,601

1,440,664

Competition receipts

2,009,100

2,308,750

Tickets and matchday income

867,376

1,134,229

Other income

955,318

682,924

11,340,592

12,796,767

4

Other operating income

The analysis of the company's other operating income for the year is as follows:

2024
£

2023
£

Miscellaneous other operating income

60,997

39,904

 

Scarlets Regional Limited

Notes to the Financial Statements for the Year Ended 30 June 2024

5

Operating loss

Arrived at after charging/(crediting)

2024
£

2023
£

Depreciation expense

410,397

455,053

Loss on disposal of property, plant and equipment

-

29,238

6

Other interest receivable and similar income

2024
£

2023
£

Interest income on bank deposits

43,359

9,916

7

Interest payable and similar expenses

2024
£

2023
£

Interest on bank overdrafts and borrowings

717,096

267,392

Interest on obligations under finance leases and hire purchase contracts

6,304

7,963

Interest expense on other finance liabilities

253,746

119,176

977,146

394,531

8

Staff costs

The aggregate payroll costs (including directors' remuneration) were as follows:

2024
£

2023
£

Wages and salaries

8,242,822

9,697,355

Social security costs

942,543

1,080,305

Pension costs, defined contribution scheme

137,127

150,339

9,322,492

10,927,999

 

Scarlets Regional Limited

Notes to the Financial Statements for the Year Ended 30 June 2024

8

Staff costs (continued)

The average number of persons employed by the company (including directors) during the year, analysed by category was as follows:

2024
No.

2023
No.

Administrative, playing and backroom staff

164

193

164

193

9

Directors' remuneration

The directors' remuneration for the year was as follows:

2024
£

2023
£

Remuneration

304,741

350,075

Contributions paid to money purchase schemes

4,052

4,375

308,793

354,450

During the year the number of directors who were receiving benefits and share incentives was as follows:

2024
No.

2023
No.

Accruing benefits under money purchase pension scheme

4

4

In respect of the highest paid director:

2024
£

2023
£

Remuneration

97,807

100,000

Company contributions to money purchase pension schemes

1,321

1,321

10

Auditors' remuneration

2024
£

2023
£

Audit of the financial statements

11,500

10,000


 

 

Scarlets Regional Limited

Notes to the Financial Statements for the Year Ended 30 June 2024

11

Taxation

Tax charged/(credited) in the profit and loss account

2024
£

2023
£

Current taxation

UK corporation tax

(147,434)

(104,474)

The tax on profit before tax for the year is the same as the standard rate of corporation tax in the UK (2023 - the same as the standard rate of corporation tax in the UK) of 25% (2023 - 20.5%).

The differences are reconciled below:

2024
£

2023
£

Loss before tax

(2,737,498)

(3,016,255)

Corporation tax at standard rate

(684,375)

(618,332)

Tax increase from effect of unrelieved tax losses carried forward

684,375

618,332

Tax decrease from effect of adjustment in research and development tax credit

(147,434)

(104,474)

Total tax credit

(147,434)

(104,474)

 

Scarlets Regional Limited

Notes to the Financial Statements for the Year Ended 30 June 2024

12

Tangible assets

Buildings
£

Plant and machinery
£

Heritage trail
 £

Total
£

Cost or valuation

At 1 July 2023

11,878,705

1,980,733

25,363

13,884,801

Additions

-

33,823

-

33,823

At 30 June 2024

11,878,705

2,014,556

25,363

13,918,624

Depreciation

At 1 July 2023

3,578,382

1,494,279

24,683

5,097,344

Charge for the year

300,475

109,682

240

410,397

At 30 June 2024

3,878,857

1,603,961

24,923

5,507,741

Carrying amount

At 30 June 2024

7,999,848

410,595

440

8,410,883

At 30 June 2023

8,300,323

486,454

680

8,787,457

Assets held under finance leases and hire purchase contracts

The net carrying amount of tangible assets includes the following amounts in respect of assets held under finance leases and hire purchase contracts:

2024
£

2023
£

Plant and equipment

159,151

180,447

   
 

Scarlets Regional Limited

Notes to the Financial Statements for the Year Ended 30 June 2024

13

Investments

2024
£

2023
£

Investments in subsidiaries

100

100

Subsidiaries

£

Cost

At 1 July 2023

100

Provision

Carrying amount

At 30 June 2024

100

At 30 June 2023

100

Details of undertakings

Details of the investments (including principal place of business of unincorporated entities) in which the company holds 20% or more of the nominal value of any class of share capital are as follows:

Undertaking

Registered office

Holding

Proportion of voting rights and shares held

2024

2023

Subsidiary undertakings

Llanelli RFC Limited

Parc Y Scarlets, Pemberton Retail Park, Llanelli, Carmarthenshire, SA14 9UZ

Ordinary

100%

100%

Subsidiary undertakings

Llanelli RFC Limited was dormant for the year-ended 30 June 2024 and is currently dormant.

 

Scarlets Regional Limited

Notes to the Financial Statements for the Year Ended 30 June 2024

14

Other financial assets (current and non-current)

Financial assets at cost less impairment
£

Total
£

Non-current financial assets

Cost

At 1 July 2023

14,300

14,300

At 30 June 2024

14,300

14,300

Impairment

Carrying amount

At 30 June 2024

14,300

14,300

15

Stocks

2024
£

2023
£

Finished goods and goods for resale

30,579

30,345

16

Debtors

Current

2024
£

2023
£

Trade debtors

157,978

249,236

Other debtors

19,299

137,470

Prepayments

319,356

220,514

 

496,633

607,220

 

Scarlets Regional Limited

Notes to the Financial Statements for the Year Ended 30 June 2024

17

Creditors

Note

2024
£

2023
£

Due within one year

 

Loans and borrowings

20

1,473,245

969,229

Trade creditors

 

1,166,282

921,535

Social security and other taxes

 

763,394

1,331,117

Other payables

 

33,830

37,004

Accruals and deferred income

 

910,970

2,577,365

 

4,347,721

5,836,250

Due after one year

 

Loans and borrowings

20

9,837,401

8,205,626

Deferred income

 

1,116,628

-

 

10,954,029

8,205,626

18

Pension and other schemes

Defined contribution pension scheme

The company operates a defined contribution pension scheme. The pension cost charge for the year represents contributions payable by the company to the scheme and amounted to £137,127 (2023 - £150,339).

Contributions totalling £26,782 (2023 - £26,211) were payable to the scheme at the end of the year and are included in creditors.

19

Share capital

Allotted, called up and fully paid shares

2024

2023

No.

£

No.

£

Ordinary shares of £1 each

12,507,478

12,507,478

11,708,135

11,708,135

Special shares of £1,000 each

500

500,000

500

500,000

Heritage shares of £1 each

2

2

2

2

12,507,980

13,007,480

11,708,637

12,208,137

 

Scarlets Regional Limited

Notes to the Financial Statements for the Year Ended 30 June 2024

19

Share capital (continued)

New shares allotted

During the year 799,343 Ordinary £1 shares were issued at par value.

Rights, preferences and restrictions

Ordinary shares have the following rights, preferences and restrictions:
Each share is entitled to one vote, dividend rights and no rights to redemption.

Heritage shares have the following rights, preferences and restrictions:
Each share will be entitled to attend and vote at general meetings of the company and vote at general meetings of the company and on a show of hands will have one vote and on a poll vote for each share.

Special shares have the following rights, preferences and restrictions:
Each share shall be entitled to receive notice of and attend and speak at any general meeting of the company but the special shares shall carry no rights to vote nor any other rights at any such meeting.

20

Loans and borrowings

Non-current loans and borrowings

2024
£

2023
£

Hire purchase contracts

72,000

108,000

Secured debentures

147,050

267,951

Other borrowings

9,618,351

7,829,675

9,837,401

8,205,626

Current loans and borrowings

2024
£

2023
£

Hire purchase contracts

35,680

36,034

Secured debentures

341,130

394,472

Other borrowings

1,096,435

538,723

1,473,245

969,229

 

Scarlets Regional Limited

Notes to the Financial Statements for the Year Ended 30 June 2024

20

Loans and borrowings (continued)

Other borrowings
Included within other borrowings is an amount owed to Carmarthenshire County Council (CCC) of £2,614,000 (2023- £2,614,000) The amount is secured by a floating charge over the company’s assets. The company pledges not to encumber any assets without consent from CCC. Interest is charged at 4% per annum. The loan was originally due for repayment in 2023, however, the company has been granted a further 15-year extension by the CCC to repay this loan. Under the new terms of this loan, repayments of the loan principal will commence in April 2026 on an equal instalment basis.

Also included in other borrowings are amounts due to the WRU of £7,955,357 (2023 - £5,295,945) which are secured by a fixed and floating charge over the assets of the company. The loans have been provided interest free on expected repayment within 5 years. The balance held in other loans has been discounted in accordance with FRS102.

Secured debentures
The debentures are secured by the assets of the company but acknowledge that CCC has a prior charge. The debentures have been provided interest free with varying repayment terms. The balance held in Secured debentures has been discounted in accordance with FRS102.

21

Related party transactions

Summary of transactions with subsidiaries

The Company has taken advantage of the exemption within FRS 102 Section 33.1A from the requirement to disclose transactions with other wholly owned members of the group.
 

Expenditure with and payables to related parties

2024

Other related parties
£

Purchase of goods

265,066

Amounts payable to related party

7,248

2023

Other related parties
£

Purchase of goods

262,836

Amounts payable to related party

8,417

 

Scarlets Regional Limited

Notes to the Financial Statements for the Year Ended 30 June 2024

21

Related party transactions (continued)

Loans from related parties

 

Other related parties

2024
£

2023
£

At start of period

431,834

594,343

Repaid

(431,834)

(110,000)

Interest transactions

-

(52,509)

At end of period

-

431,834