FOR THE YEAR ENDED 31 DECEMBER 2023
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DWELLWORKS EUROPE LIMITED
COMPANY INFORMATION
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DWELLWORKS EUROPE LIMITED
CONTENTS
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DWELLWORKS EUROPE LIMITED
GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
The group is owned by Dwellworks, LLC, headquartered in the USA, and benefits from global agreements with Relocation Management Companies (RMC), to service the corporate clients of the RMC. As part of its core values, Dwellworks constantly evaluates the market and listens to client's needs to drive expansion efforts and product innovation.
Outside of a global pandemic, the principle risk of the business is the global economy. As the economy strengthens and weakens, global businesses will expand or contract their travel and relocation programs. The expansion and contraction directly affects the performance of our business. Other minor risks and uncertainties are associated with customer consolidations and supplier demand.
On an annual basis, key performance indicators are reviewed versus the plan and prior year. A summary of the results is below.
• Revenue was unfavorable to the plan by 17%. • Margin was unfavorable to the plan by 34%. • EBITDA (excluding the intercompany management charge) was unfavorable to the plan by 59%.
Other key performance indicators for the business are:
• Weekly Volume of RFPs • Conversion rate of RFPs
S.172 of the Companies Act 2006 Statement:
The directors are aware of their duties under S.172 of the Companies Act 2006 to act in the way which they consider in good faith, would be most likely to promote the success of the company for the benefit of its shareholders. The directors consider it crucial that the company maintains a reputation for high standards of business conduct. The directors are responsible for setting, monitoring and upholding culture, values, standards, ethics, brand and reputation of the company. Management drives the embedding of the desired culture throughout the organisation.
This report was approved by the board on 10 April 2025 and signed on its behalf.
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DWELLWORKS EUROPE LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
The directors present their report and the financial statements for the year ended 31 December 2023.
The loss for the year, after taxation, amounted to £2,069,650 (2022: loss £495,127).
The Directors have not recommended a dividend for the year (2022: £NIL).
The directors who served during the year were:
The company plans to continue to collaborate with its customers to provide a high level of relocation services and corporate housing options.
During the year Dwellworks Europe Group 'the Group' incurred a loss of £2,069,650 (2022: loss of £495,127) and at the year end held net liabilities of £1,296,409 (2022: net assets of £697,963) and net current liabilities of £450,416 (2022: net current assets of £211,012). The current year losses have been increased significantly as a result of the costs of closure of some of the operations of the Chinese components of the Group in the year and the Group are confident that such costs will not reoccur.
Post year end, management accounts for the year to December 2024 report positive EBITDA for the Group and an improving Group balance sheet position, however as at 31 December 2024 the Group still expects to report a net liabilities position overall. Dwellworks Europe Group has received a letter of support from its US parent undertaking confirming its ongoing financial support for a minimum period of 12 months from the approval of these accounts, should this be required. The Directors believe that the ultimate parent undertaking will provide financial and other support if required, but the financial statements do not reflect the adjustments that would be necessary should that support not be forthcoming and the ability of the Group to continue in operation be jeopardised due to the lack of such support. However, given the net liability balance sheet position and the fact that no formal deed of undertaking has been issued by the parent company, the Directors have concluded that a material uncertainty exists in relation to events or conditions that may cast significant doubt on the ability of the Group to realise its assets and discharge its liabilities in the normal course of business and, therefore, continue to operate as a going concern. Given that the current 2024 management results significantly strengthened the financial position and these results included business modifications to strengthen future earnings, we believe that this risk is remote.
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DWELLWORKS EUROPE LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
There have been no significant events affecting the Group since the year end.
The auditors, Bishop Fleming LLP, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.
This report was approved by the board and signed on its behalf.
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DWELLWORKS EUROPE LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2023
The directors are responsible for preparing the Group Strategic Report, the Directors' Report and the consolidated 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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. 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 the Group and of the profit or loss of the Group for that period.
In preparing these financial statements, the directors are required to:
∙select suitable accounting policies for the Group's financial statements 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 Group 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 the Group and to 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 the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
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DWELLWORKS EUROPE LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF DWELLWORKS EUROPE LIMITED
We have audited the financial statements of Dwellworks Europe Limited (the 'parent Company') and its subsidiaries (the 'Group') for the year ended 31 December 2023, which comprise the Group Statement of Comprehensive Income, the Group and Company Statements of Financial Position, the Group Statement of Cash Flows, the Consolidated Analysis of Net Debt, the Group and Company Statement of Changes in Equity and the related notes, 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).
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 Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the Group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council'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.
We draw attention to note 1.3 in the financial statements, which indicates that the Dwellworks Europe Group is reliant on continued parent company support and, whilst a letter of support has been received, no formal deed of undertaking has been issued to provide the necessary support. As stated in note 1.3, these events or conditions, along with the other matters as set forth in note 1.3, indicate that a material uncertainty exists that may cast significant doubt on the Group's or the parent 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.
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DWELLWORKS EUROPE LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF DWELLWORKS EUROPE LIMITED (CONTINUED)
The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' 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.
In our opinion, based on the work undertaken in the course of the audit:
∙the information given in the Group 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 Group Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.
In the light of the knowledge and understanding of the Group and the parent Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group Strategic Report or the Directors' Report.
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DWELLWORKS EUROPE LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF DWELLWORKS EUROPE LIMITED (CONTINUED)
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 Auditors' 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 Group 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:
•We have considered the nature of the industry and sector, control environment and business
performance, key drivers for directors’ remuneration, bonus levels and performance targets; • We have considered the results of our enquiries of management about their own identification and assessment of the risks of irregularities; • Any matters identified having obtained and reviewed the Company’s documentation of their policies and procedures relating to: o Identifying, evaluation and complying with laws and regulations and whether they were aware of any instances of non-compliance; o Detecting and responding to the risks of fraud and whether they have knowledge of any actual, suspected or alleged fraud; o The internal controls established to mitigate risks of fraud or noncompliance with laws and regulations; As Group and UK component auditors, our assessment of matters relating to non-compliance with laws and regulations and fraud encompassed both the holding company and the UK subsidiary. In addition, we made enquiries as part of our audit of the Group regarding matters relating to non-compliacne with laws and regulations and fraud in relation to the Group entities we are not expresing an opinion on in order for this Group audit report to be issued. As a result of these procedures, we considered the opportunities and incentives that may exist within the organisation for fraud and identified the greatest potential for fraud in revenue recognition. In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override. We also obtained an understanding of the legal and regulators frameworks that the Company operates in, focusing on provisions of those laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements. The key laws and regulations we considered in this context included the Companies Act 2006, Financial Reporting Standard 102 and UK tax legislation. In addition, we considered provisions of other laws and regulations that do not have a direct effect on the financial statements but compliance with which may be fundamental to the Company’s ability to operate or to avoid a material penalty. These included data protection regulations, occupational health and safety regulations and employment legislation. Audit response to risks identified Our procedures to respond to the risks identified included the following: • Reviewing the financial statement disclosures and testing to supporting documentation to assess compliance with provisions of relevant laws and regulations described as having direct effect on the financial statements. • Enquiring of management concerning actual and potential litigation and claims; • Performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud; • Performing detailed transactional testing in relation to the recognition of revenue;
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DWELLWORKS EUROPE LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF DWELLWORKS EUROPE LIMITED (CONTINUED)
• In addressing the risk of fraud through management override of controls, testing the appropriateness of journal entries, and other adjustments; assessing whether the judgements made in making accounting estimates are indicative of potential bias; and evaluating the business rationale of any significant transactions that are unusual or outside the normal course of the business.
We also communicated relevant identified laws and regulations and potential fraud risk to all engagement team members and remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit. Our audit procedures were designed to respond to risks of material misstatement in the financial statements, recognising that the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from an error, as fraud may involve deliberate concealment by, for example, forgery, misrepresentations or through collusion. There are inherent limitations in the audit procedures performed 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.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditors' 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 Auditors' 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.
for and on behalf of
Chartered Accountants
Statutory Auditors
Chy Nyverow
Newham Road
Cornwall
TR1 2DP
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DWELLWORKS EUROPE LIMITED
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
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DWELLWORKS EUROPE LIMITED
REGISTERED NUMBER:08384946
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2023
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 17 to 36 form part of these financial statements.
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DWELLWORKS EUROPE LIMITED
REGISTERED NUMBER:08384946
COMPANY STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2023
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 17 to 36 form part of these financial statements.
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