Company registration number 10693161 (England and Wales)
HANARO LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
HANARO LIMITED
COMPANY INFORMATION
Directors
Mr W Kim
Mr L Straughan
Mr H Van Baalen
Secretary
Oakwood Corporate Secretary Limited
Company number
10693161
Registered office
3rd Floor 1 Ashley Road
Altrincham
Cheshire
WA14 2DT
Auditor
UHY Hacker Young
Quadrant House
4 Thomas More Square
London
E1W 1YW
HANARO LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2 - 3
Independent auditor's report
4 - 7
Income statement
8
Statement of financial position
9
Statement of changes in equity
10
Statement of cash flows
11
Notes to the financial statements
12 - 20
HANARO LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2024
- 1 -
The directors present the strategic report for the year ended 31 March 2024.
Review of the business
The company is established to invest a senior secured loan to a holding company of biomass power plant (the “Project”).
The main business of the company is solely related to the lending activities such as providing and receiving repayment of loan principal and interest payments from the Project.
Principal risks and uncertainties
Key risks and uncertainties associated with lending activities are the dependence of cash flows of the Project.
The power plant which the company made lending to, has achieved a key Milestone, the Contract for the Difference (CfD), on November 10, 2022. The power plant experienced some welding issues previously which has caused operation to be delayed. After an overall inspection and improvement during 2023, the power plant resumed normal operation in the 4th quarter of 2023.
Since the 2023 Restructuring Plan, the power plant has faced additional challenges that depleted the extra funding. As a result, the plant entered a new Restructuring Plan in 2024 to address liquidity issues and renegotiate long-term contracts. After the completion of the restructuring, the plant is currently operating smoothly.
Development and performance
The company made a loss before tax of £11,088,959 (2023: £167,466,328) due to the issues noted above. At the year end, its net liabilities amount to £219,757,302 (2023: £208,668,344).
Mr W Kim
Director
28 March 2025
HANARO LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2024
- 2 -
The directors present their annual report and financial statements for the year ended 31 March 2024.
Principal activities
The principal activity of the company continued to be that of an investment company.
Results and dividends
The results for the year are set out on page 8.
No ordinary dividends were paid. The directors do not recommend payment of a final dividend.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
Mr W Kim
Mr L Straughan
Mr H Van Baalen
Auditor
The auditor, UHY Hacker Young, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
Statement of directors' responsibilities
The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with International Financial Reporting Standards (IFRSs) as adopted by the United Kingdom. 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, International Accounting Standard 1 requires that directors:
properly select and apply accounting policies;
present information, including accounting policies, in a manner that provides relevant, reliable, comparable and understandable information;
provide additional disclosures when compliance with the specific requirements in IFRSs are insufficient to enable users to understand the impact of particular transactions, other events and conditions on the entity's financial position and financial performance; and
make an assessment of the company's ability to continue as a going concern.
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.
HANARO LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 3 -
Statement of disclosure to auditor
Each director in office at the date of approval of this annual report confirms that:
so far as the director is aware, there is no relevant audit information of which the company's auditor is unaware, and
the director has taken all the steps that he / she ought to have taken as a director in order to make himself / herself aware of any relevant audit information and to establish that the company's auditor is aware of that information.
This confirmation is given and should be interpreted in accordance with the provisions of section 418 of the Companies Act 2006.
Medium-sized companies exemption
This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.
On behalf of the board
Mr W Kim
Director
28 March 2025
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF HANARO LIMITED
- 4 -
Opinion
We have audited the financial statements of Hanaro Limited (the 'company') for the year ended 31 March 2024 which comprise the income statement, the statement of financial position, the statement of changes in equity, the statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and UK adopted international accounting standards.
In our opinion the financial statements:
give a true and fair view of the state of the company's affairs as at 31 March 2024 and of its loss for the year then ended;
have been properly prepared in accordance with UK adopted international accounting standards; 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.
Material uncertainty relating to going concern
As stated in Note 1.2 of the financial statements, these events or conditions, along with the other matters as set forth in note 1.2, indicate that a material uncertainty exists that may cast significant doubt on the company's ability to continue as a going concern.
Our opinion is not modified in respect of this matter.
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF HANARO LIMITED (CONTINUED)
- 5 -
The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit:
the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors' responsibilities statement, 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.
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF HANARO LIMITED (CONTINUED)
- 6 -
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.
Based on our understanding of the Company and the industry in which it operates, we identified that the principal risks of non-compliance with laws and regulations related to the acts by the Company, which were contrary to applicable laws and regulations including fraud, and we considered the extent to which non-compliance might have a material effect on the financial statements. We also considered those laws and regulations that have a direct impact on the preparation of the financial statements such as the Companies Act 2006. We evaluated management's incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls).
Audit procedures performed included: review of the financial statement disclosures to underlying supporting documentation, enquiries of management and testing of journals and evaluating whether there was evidence of bias by the Directors that represented a risk of material misstatement due to fraud.
There are inherent limitations in the audit procedures described above and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion.
A further description of our responsibilities is available on the Financial Reporting Council's website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
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.
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF HANARO LIMITED (CONTINUED)
- 7 -
Vinodkumar Vadgama (Senior Statutory Auditor)
For and on behalf of UHY Hacker Young
28 March 2025
Chartered Accountants
Statutory Auditor
HANARO LIMITED
INCOME STATEMENT
FOR THE YEAR ENDED 31 MARCH 2024
- 8 -
2024
2023
Notes
£
£
Revenue
2
9,907,197
22,817,535
Gross profit
9,907,197
22,817,535
Administrative expenses
(14,834)
(30,385)
Exceptional items
3
(171,428,267)
Operating profit/(loss)
4
9,892,363
(148,641,117)
Finance costs
6
(20,991,522)
(18,825,211)
Loss before taxation
(11,099,159)
(167,466,328)
Income tax expense
-
-
Loss and total comprehensive income for the year
(11,099,159)
(167,466,328)
The income statement has been prepared on the basis that all operations are continuing operations.
HANARO LIMITED
STATEMENT OF FINANCIAL POSITION
AS AT 31 MARCH 2024
31 March 2024
- 9 -
2024
2023
Notes
£
£
Non-current assets
Other receivables
7
114,011,154
104,053,956
Current assets
Trade and other receivables
7
493
Cash and cash equivalents
332,309
383,486
332,802
383,486
Current liabilities
Trade and other payables
13
24,150
10,000
Net current assets
308,652
373,486
Non-current liabilities
Borrowings
9
334,087,308
313,095,785
Net liabilities
(219,767,502)
(208,668,343)
Equity
Called up share capital
14
1
1
Retained earnings
(219,767,503)
(208,668,344)
Total equity
(219,767,502)
(208,668,343)
These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.
The financial statements were approved by the board of directors and authorised for issue on 28 March 2025 and are signed on its behalf by:
Mr W Kim
Director
Company registration number 10693161 (England and Wales)
HANARO LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2024
- 10 -
Share capital
Retained earnings
Total
£
£
£
Balance at 1 April 2022
1
(41,202,016)
(41,202,015)
Year ended 31 March 2023:
Loss and total comprehensive income
-
(167,466,328)
(167,466,328)
Balance at 31 March 2023
1
(208,668,344)
(208,668,343)
Year ended 31 March 2024:
Loss and total comprehensive income
-
(11,099,159)
(11,099,159)
Balance at 31 March 2024
1
(219,767,503)
(219,767,502)
HANARO LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2024
- 11 -
2024
2023
Notes
£
£
£
£
Cash flows from operating activities
Cash absorbed by operations
18
(51,177)
(28,575)
Net cash outflow from operating activities
(51,177)
(28,575)
Financing activities
Loans provided
(25,000,000)
Proceeds from borrowings
25,100,000
Net cash (used in)/generated from financing activities
-
100,000
Net (decrease)/increase in cash and cash equivalents
(51,177)
71,425
Cash and cash equivalents at beginning of year
383,486
312,061
Cash and cash equivalents at end of year
332,309
383,486
HANARO LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
- 12 -
1
Accounting policies
Company information
Hanaro Limited is a private company limited by shares incorporated in England and Wales. The registered office is 3rd Floor 1 Ashley Road, Altrincham, Cheshire, WA14 2DT. The company's principal activities and nature of its operations are disclosed in the directors' report.
1.1
Accounting convention
The financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted for use in the United Kingdom and with those parts of the Companies Act 2006 applicable to companies reporting under IFRS, except as otherwise stated.
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 on the historical cost basis. The principal accounting policies adopted are set out below.
1.2
Going concern
These financial statements are prepared on the going concern basis. Having considered the future cashflows of the company, the directors have a reasonable expectation that the company will continue in operational existence for the foreseeable future. However, the directors are aware of certain material uncertainties which may cause doubt on the company's ability to continue as a going concern.
As explained in the Strategic Report, the power plant which the company made lending to has achieved a key Milestone, the Contract for the Difference (CfD), on November 10, 2022, and after an overall inspection and improvement during 2023, the power plant resumed normal operation in the 4th quarter of 2023.
Since the 2023 Restructuring Plan, the power plant has faced additional challenges that depleted the extra funding. As a result, the plant entered a new Restructuring Plan in 2024 to address liquidity issues and renegotiate long-term contracts. After the completion of the restructuring, the plant is currently operating smoothly.
Furthermore, the company's creditors have agreed not to seek repayment of amounts owed until such time as the company is able to pay its debts as they fall due.
1.3
Revenue
Revenue represents interest receivable for the period on advances made.
-Interest income
Interest revenue is accrued on a time basis by reference to the principal outstanding and the effective interest rate applicable.
1.4
Cash and cash equivalents
Cash and cash equivalents include cash in hand, deposits held at call with banks, and other short-term liquid investments with original maturities of three months or less.
HANARO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
- 13 -
1.5
Financial assets
Financial assets are recognised in the company's statement of financial position when the company becomes party to the contractual provisions of the instrument. Financial assets are classified into specified categories, depending on the nature and purpose of the financial assets.
At initial recognition, financial assets classified as fair value through profit and loss are measured at fair value and any transaction costs are recognised in profit or loss. Financial assets not classified as fair value through profit and loss are initially measured at fair value plus transaction costs.
Financial assets at fair value through profit or loss
Financial assets are classified as at FVTPL when the financial asset is held for trading. This is the case if:
the asset has been acquired principally for the purpose of selling in the near term, or
on initial recognition it is part of a portfolio of identified financial instruments that the manages together and has a recent actual pattern of short-term profit taking, or
it is a derivative that is not designated and effective as a hedging instrument.
Financial assets at FVTPL are stated at fair value with any gains or losses arising on remeasurement recognised in profit or loss. The net gain or loss recognised in profit or loss incorporates any dividend or interest earned on the financial asset. Interest and dividends are included in 'Investment income' and gains and losses on remeasurement included in 'other gains and losses' in the statement of comprehensive income.
Financial assets held at amortised cost
Financial assets with fixed or determinable payments and fixed maturity dates that the Company has the positive intent and ability to hold to maturity are classified as held to maturity investments.
Held to maturity investments are measured at amortised cost using the effective interest method less any impairment, with revenue recognised on an effective yield basis.
The effective interest method is a method of calculating the amortised cost of a debt instrument and of allocating the interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts through the expected life of the debt instrument to the net carrying amount on initial recognition.
Trade Receivables, loans and other receivables that have fixed or determinable payments that are not quoted in an active market are classified as loans and receivables. Loans and receivables are measured at amortised cost using the effective interest method, less any impairment.
Interest is recognised by applying the effective interest rate, except for short-term receivables when the recognition of interest would be immaterial. The effective interest method is a method of calculating the amortised cost of a debt instrument and of allocating the interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts through the expected life of the debt instrument to the net carrying amount on initial recognition.
HANARO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
- 14 -
Financial assets at fair value through other comprehensive income
Debt instruments are classified as financial assets measured at fair value through other comprehensive income where the financial assets are held within the company’s business model whose objective is achieved by both collecting contractual cash flows and selling financial assets, and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.
A debt instrument measured at fair value through other comprehensive income is recognised initially at fair value plus transaction costs directly attributable to the asset. After initial recognition, each asset is measured at fair value, with changes in fair value included in other comprehensive income. Accumulated gains or losses recognised through other comprehensive income are directly transferred to profit or loss when the debt instrument is derecognised.
Financial assets classified as available for sale are measured at fair value with gains and losses arising from changes in fair value recognised in other comprehensive income. Where an AFS financial asset is disposed of or determined to be impaired, the cumulative gain or loss previously recognised in other comprehensive income is reclassified to profit or loss.
Dividends and interest earned on AFS financial assets are included in the investment income line item in the statement of comprehensive income.
Impairment of financial assets
Financial assets carried at amortised cost and FVOCI are assessed for indicators of impairment at each reporting end date.
The expected credit losses associated with these assets are estimated on a forward-looking basis. A broad range of information is considered when assessing credit risk and measuring expected credit losses, including past events, current conditions, and reasonable and supportable forecasts that affect the expected collectability of the future cash flows of the instrument.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire, or when it transfers the financial asset and substantially all the risks and rewards of ownership to another entity.
1.6
Financial liabilities
The company recognises financial debt when the company becomes a party to the contractual provisions of the instruments. Financial liabilities are classified as either 'financial liabilities at fair value through profit or loss' or 'other financial liabilities'.
Other financial liabilities
Other financial liabilities, including borrowings, trade payables and other short-term monetary liabilities, are initially measured at fair value net of transaction costs directly attributable to the issuance of the financial liability. They are subsequently measured at amortised cost using the effective interest method. For the purposes of each financial liability, interest expense includes initial transaction costs and any premium payable on redemption, as well as any interest or coupon payable while the liability is outstanding.
HANARO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
- 15 -
Derecognition of financial liabilities
Financial liabilities are derecognised when, and only when, the company’s obligations are discharged, cancelled, or they expire.
1.7
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of direct issue costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
1.8
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 inventories or non-current 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.
1.9
Foreign exchange
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.
2
Revenue
2024
2023
£
£
Revenue analysed by class of business
Investments
9,907,197
22,817,535
All revenue is derived from the UK.
3
Exceptional items
2024
2023
£
£
Expenditure
Provision for receivables
-
171,428,267
HANARO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
3
Exceptional items
(Continued)
- 16 -
As explained in the Strategic Report, The power plant which the company made lending tom has achieved a key Milestone, the Contract for the Difference (CfD), on November 10, 2022, and after an overall inspection and improvement during 2023, the power plant resumed normal operation in the 4th quarter of 2023.
Since the 2023 Restructuring Plan, the power plant has faced additional challenges that depleted the extra funding. As a result, the plant entered a new Restructuring Plan in 2024 to address liquidity issues and renegotiate long-term contracts. The plant's commissioning may face further delays, unexpected issues, and cost overruns, which could impact its operational availability.
4
Operating profit/(loss)
2024
2023
Operating profit/(loss) for the year is stated after charging/(crediting):
£
£
Fees payable to the company's auditor for the audit of the company's financial statements
11,750
12,310
5
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2024
2023
Number
Number
Management
3
3
The directors acting during the year are remunerated by other group companies. There are no identifiable qualifying services for the company in the current year.
6
Finance costs
2024
2023
£
£
Other interest payable
20,991,522
18,825,211
Of the total finance costs, deemed finance costs of £20,991,522 (2023: £18,825,211) are non-cash. £nil (2023:£nil) was paid in cash.
HANARO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 17 -
7
Trade and other receivables
Current
Non-current
2024
2023
2024
2023
£
£
£
£
Other receivables
-
-
114,011,154
104,053,956
Prepayments
493
-
-
493
-
114,011,154
104,053,956
Non-current other receivables above are classified as loans and receivables and therefore are measured at amortised costs. The loans attract an interest rate of 6.6% and a default rate of 2%. The loans are repayable on or before 30 November 2034.
8
Trade receivables - credit risk
Fair value of trade receivables
The directors consider that the carrying amount of trade and other receivables is equal to fair value.
9
Borrowings
Non-current
2024
2023
£
£
Borrowings held at amortised cost:
Other loans
27,482,880
24,913,105
Loans from related parties
306,604,428
288,182,680
334,087,308
313,095,785
The initial loan which attracts an interest rate of 6.4% is unsecured and repayable on or before 30 November 2034. In FY21, a bridging loan facility was obtained which attracts an interest rate of 3M LIBOR + 4.25% which is unsecured.
On 15 June 2021 the bridging loan facility was switched to a senior loan agreement with an interest rate of 7% to 31 August 2021 and 10% thereafter. The loan is unsecured and repayable on 31 December 2025.
On the 22 April 2022, another senior loan was obtained which attracts an interest rate of 15% is unsecured and repayable on or before 31 August 2034.
HANARO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 18 -
10
Fair value of financial liabilities
The directors consider that the carrying amounts of financial liabilities carried at amortised cost in the financial statements approximate to their fair values.
11
Liquidity risk
Prudent liquidity risk management implies maintaining sufficient cash. Management monitors forecasts of the company's liquidity reserve, comprising cash and cash equivalents, on the basis of expected cash flow. At 31 December 2024, the company held cash and cash equivalents of £332,309 (2023: £383,486).
12
Market risk
Market risk management
The company's exposure to interest rate risk, foreign currency risk, credit risk and liquidity risk arises in the normal course of its business. These risks are managed by the company's financial management policies and practices described below:
Foreign exchange risk
The company is not subject to any foreign exchange risk as all borrowings are denominated in GBP.
Interest rate risk
Both loans are a fixed-term loan, so there is no interest rate risk within these projects.
Credit risk
Credit risk arises from receivables where the counterparty fails to discharge their obligation in relation to the instrument. Whilst management have appropriate credit assessment methods in place to establish credit worthiness of counterparties and monitor receivables regularly, as explained in the Strategic Report, the power plant is currently temporarily not operational due to welding issues. As a result of this, a provision has been recognised on the interest receivable accordingly.
13
Trade and other payables
2024
2023
£
£
Accruals
24,150
10,000
HANARO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 19 -
14
Share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary share of £1 each
1
1
1
1
15
Capital risk management
The company manages its capital to ensure that it will be able to continue as a going concern.
The capital structure of the company consists of debt,cash and cash equivalents and equity comprising of share capital and retained earnings. The company reviews its capital structure annually and as part of this review considers that cost of capital and the risks associated with each class of capital.
16
Related party transactions
The company received borrowings from Industrial Bank of Korea in its capacity as trustees of NH-Amundi Europe Green Infrastructure Trust I Fund. Balance outstanding at the year end was £306,604,428 (2023: £288,182,680). The company is a wholly owned entity of NH-Amundi Europe Green Infrastructure Trust I Fund.
17
Controlling party
The ultimate controlling party of the company is the trustees of NH-Amundi Europe Green Infrastructure Trust I Fund.
18
Cash absorbed by operations
2024
2023
£
£
Loss for the year before income tax
(11,099,159)
(167,466,328)
Adjustments for:
Finance costs
20,991,522
18,825,211
Impairment
-
171,428,267
Movements in working capital:
Increase in trade and other receivables
(9,957,690)
(22,817,534)
Increase in trade and other payables
14,150
1,809
Cash absorbed by operations
(51,177)
(28,575)
HANARO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 20 -
19
Analysis of changes in net debt
1 April 2023
Cash flows
31 March 2024
£
£
£
Cash at bank and in hand
383,486
(51,177)
332,309
Borrowings excluding overdrafts
(313,095,785)
(20,991,523)
(334,087,308)
(312,712,299)
(21,042,700)
(333,754,999)
1 April 2022
Cash flows
31 March 2023
Prior year:
£
£
£
Cash at bank and in hand
312,061
71,425
383,486
Borrowings excluding overdrafts
(269,170,574)
(62,750,422)
(313,095,785)
(268,858,513)
(62,678,997)
(312,712,299)
2024-03-312023-04-01falsefalseCCH SoftwareCCH Accounts Production 2024.310Mr W KimMr L StraughanMr H Van BaalenOakwood Corporate Secretary Limited106931612023-04-012024-03-3110693161bus:Director12023-04-012024-03-3110693161bus:Director22023-04-012024-03-3110693161bus:Director32023-04-012024-03-3110693161bus:CompanySecretary12023-04-012024-03-3110693161bus:RegisteredOffice2023-04-012024-03-31106931612024-03-3110693161core:ContinuingOperations2023-04-012024-03-31106931612022-04-012023-03-3110693161core:Exceptional12023-04-012024-03-3110693161core:Exceptional12022-04-012023-03-3110693161core:ContinuingOperations2022-04-012023-03-3110693161core:RetainedEarningsAccumulatedLosses2023-04-012024-03-3110693161core:RetainedEarningsAccumulatedLosses2022-04-012023-03-31106931612023-03-31106931612023-03-31106931612022-03-3110693161core:Non-currentFinancialInstruments2024-03-3110693161core:Non-currentFinancialInstruments2023-03-3110693161core:ShareCapital2024-03-3110693161core:ShareCapital2023-03-3110693161core:RetainedEarningsAccumulatedLosses2024-03-3110693161core:RetainedEarningsAccumulatedLosses2023-03-3110693161core:OtherMiscellaneousReserve2022-03-3110693161core:FinancialInstrumentsFairValueThroughProfitOrLoss2023-04-012024-03-3110693161core:Held-to-maturityFinancialAssets2023-04-012024-03-3110693161core:LoansReceivables2023-04-012024-03-3110693161core:Available-for-saleFinancialAssets2023-04-012024-03-3110693161core:CurrentFinancialInstruments2024-03-3110693161core:CurrentFinancialInstruments2023-03-3110693161bus:PrivateLimitedCompanyLtd2023-04-012024-03-3110693161bus:Audited2023-04-012024-03-3110693161bus:FullIFRS2023-04-012024-03-3110693161bus:FullAccounts2023-04-012024-03-31xbrli:purexbrli:sharesiso4217:GBP