Company registration number 03808062 (England and Wales)
INDIGO LEISURE LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JULY 2024
INDIGO LEISURE LIMITED
COMPANY INFORMATION
Directors
Mr J M Wilson
Mr C J Bloomfield
Secretary
Mr C J Bloomfield
Company number
03808062
Registered office
63 Western Road
Hove
BN3 1JD
Auditor
Plummer Parsons Accountants Limited
4 Frederick Terrace
Frederick Place
Brighton
East Sussex
BN1 1AX
Business address
63 Western Road
Hove
BN3 1JD
INDIGO LEISURE LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2
Directors' responsibilities statement
3
Independent auditor's report
4 - 7
Statement of comprehensive income
8
Statement of financial position
9
Statement of changes in equity
10
Statement of cash flows
11
Notes to the financial statements
12 - 25
INDIGO LEISURE LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 JULY 2024
- 1 -

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

Fair review of the business

Pre-tax profit for the year is £4,122,505 compared to £4,011,852 for the previous year.

Principal risks and uncertainties

The principal risks an uncertainties faced by the company are the potential for loss of trade as a result of local competition, the risks presented by wider macro-economic factors, reduced consumer confidence and changes in customer preferences, which effect customer spend.

 

Interest rate risk:

The directors are aware of the inherent risks arising from movements in interest rate. The company's modest borrowing requirements limits its exposure to interest rate risk.

 

Credit risks:

The company has no significant exposure to credit risk.

 

Liquidity risk:

The company has a policy of maintaining sufficient liquid resources to fund it day to day operations, and therefore has little exposure to liquidity risk. The company ensures sufficient financial headroom by the use of a combination of long term and short term finances.

 

Price risk:

The company endeavours to mitigate price risk by passing on price increases wherever possible.

Key performance indicators

The key performance indicators used by the directors are gross profit margin and earnings before interest, tax , depreciation and amortisation (EBITDA).

2024
2023
£
£
Turnover
20,070,237
18,679,725
Gross profit margin
66.04%
67.29%
EBITDA
4,782,964
4,585,579

On behalf of the board

Mr J M Wilson
Director
5 February 2025
INDIGO LEISURE LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 JULY 2024
- 2 -

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

Principal activities

The principal activity of the company was that of operators of public houses primarily in Brighton and Hove.

Directors

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

Mr J M Wilson
Mr C J Bloomfield
Results and dividends

The results for the year are set out on page 8.

Future developments

The company is committed to a programme of continued improvements to its estate of pubs in the Brighton and Hove area, in order to maintain its competitive edge.

Auditor

The auditor, Plummer Parsons Accountants Limited, is deemed to be reappointed under section 487(2) of the Companies Act 2006.

Strategic report

The company has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the company's strategic report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the directors' report. It has done so in respect of the company's risk management objectives and policies.

Statement of disclosure to auditor

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.

On behalf of the board
Mr J M Wilson
Director
5 February 2025
INDIGO LEISURE LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 JULY 2024
- 3 -

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

 

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:

 

 

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the 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.

On behalf of the board
Mr J M Wilson
Director
5 February 2025
INDIGO LEISURE LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF INDIGO LEISURE LIMITED
- 4 -
Opinion

We have audited the financial statements of Indigo Leisure Limited (the 'company') for the year ended 31 July 2024 which comprise the statement of comprehensive income, 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 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:

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'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.

Conclusions relating to going concern

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

 

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

 

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Other information

The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

 

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:

INDIGO LEISURE LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF INDIGO LEISURE LIMITED
- 5 -
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:

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.

Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

Identifying and responding to risk of misstatement due to fraud:

To identify the potential risk of material misstatement due to fraud we assessed the conditions that could provide the opportunity and incentive to commit fraud. As required by auditing standards we performed procedures to address the of risk fraud arising through management override of internal controls, and the potential for bias in accounting estimates. The fraud risks identified were communicated to the audit team and remained alert to any indications of non-compliance throughout the audit. No further fraud risk were identified.

INDIGO LEISURE LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF INDIGO LEISURE LIMITED
- 6 -

Based on our understanding of the company and industry, and through discussion with management (as required by auditing standards), we identified that the principal risks of non-compliance with laws and regulations related to the Companies Act 2006, the Licencing Act 2003, health and safety, anti-bribery, anti-money laundering and employment law.

 

The company is subject to laws and regulations which are specific to the industry in which it operates. Non compliance with these operational regulations have the potential to materially effect amounts or disclosures in the financial statements, either through litigation, the imposition of financial penalties or withdrawal of the company's licence to operate. Auditing standards limit the audit procedures required to identify breaches with these laws and regulations to enquiry of the directors and management and inspection of correspondence, if any. If operational breaches are not disclosed to us or are not evident from a review of correspondence, the audit will not detect those breaches.

 

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 Companies Act 2006.

 

We communicated identified laws and regulations throughout our team and remained alert to any indications of non-compliance throughout the audit. We evaluated management’s incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls), and determined that the principal risks were related to inappropriate journal entries to increase revenue or reduce expenditure, management bias in accounting estimates and judgmental areas.

 

Audit response to risks identified:

The Audit procedures performed by the company engagement team in response to the identified risk of misstatement arising either through fraud or non compliance with laws and regulations, included the following:

 

INDIGO LEISURE LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF INDIGO LEISURE LIMITED
- 7 -

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 regulations. 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. We are not responsible for the prevention of fraud or non-compliance and our audit cannot be expected to identify all non compliances with laws and regulations.

 

As part of an audit in accordance with ISAs (UK), we exercise professional judgement and maintain professional scepticism throughout the audit. We also:

 

 

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

 

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.

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.

Steven Griffen FCA FCCA (Senior Statutory Auditor)
For and on behalf of Plummer Parsons Accountants Limited
28 February 2025
Chartered Accountants
Statutory Auditor
4 Frederick Terrace
Frederick Place
Brighton
East Sussex
BN1 1AX
INDIGO LEISURE LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 JULY 2024
- 8 -
2024
2023
Notes
£
£
Revenue
3
20,070,237
18,679,726
Cost of sales
(6,815,068)
(6,110,423)
Gross profit
13,255,169
12,569,303
Administrative expenses
(9,368,988)
(8,679,194)
Other operating income
252,775
146,124
Operating profit
5
4,138,956
4,036,233
Finance costs
8
(16,451)
(24,381)
Profit before taxation
4,122,505
4,011,852
Taxation
10
(1,277,007)
(668,816)
Profit for the financial year
2,845,498
3,343,036

The income statement has been prepared on the basis that all operations are continuing operations.

INDIGO LEISURE LIMITED
STATEMENT OF FINANCIAL POSITION
AS AT 31 JULY 2024
31 July 2024
- 9 -
2024
2023
Notes
£
£
£
£
Fixed assets
Property, plant and equipment
12
5,519,757
5,851,444
Current assets
Inventories
13
267,337
142,729
Trade and other receivables
14
6,780,073
6,556,168
Cash at bank and in hand
1,389,350
1,236,669
8,436,760
7,935,566
Current liabilities
15
(1,984,740)
(1,586,559)
Net current assets
6,452,020
6,349,007
Total assets less current liabilities
11,971,777
12,200,451
Non-current liabilities
18
-
0
(101,240)
Provisions for liabilities
19
(529,988)
(370,896)
Net assets
11,441,789
11,728,315
Equity
Called up share capital
20
10,000
10,000
Revaluation reserve
313,919
313,919
Retained earnings
11,117,870
11,404,396
Total equity
11,441,789
11,728,315
The financial statements were approved by the board of directors and authorised for issue on 5 February 2025 and are signed on its behalf by:
Mr J M Wilson
Director
Company Registration No. 03808062
INDIGO LEISURE LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 JULY 2024
- 10 -
Share capital
Non Distributable Reserves
Retained Earnings
Total
Notes
£
£
£
£
Balance at 1 August 2022
10,000
313,919
11,603,572
11,927,491
Year ended 31 July 2023:
Profit and total comprehensive income for the year
-
-
3,343,036
3,343,036
Dividends
9
-
-
(3,542,212)
(3,542,212)
Balance at 31 July 2023
10,000
313,919
11,404,396
11,728,315
Year ended 31 July 2024:
Profit and total comprehensive income for the year
-
-
2,845,498
2,845,498
Dividends
9
-
-
(3,132,024)
(3,132,024)
Balance at 31 July 2024
10,000
313,919
11,117,870
11,441,789
INDIGO LEISURE LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 JULY 2024
- 11 -
2024
2023
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
27
4,385,805
5,646,854
Interest paid
(16,451)
(24,381)
Corporation tax paid
(562,326)
(688,357)
Net cash inflow from operating activities
3,807,028
4,934,116
Investing activities
Purchase of property, plant and equipment
(312,319)
(2,081,511)
Net cash used in investing activities
(312,319)
(2,081,511)
Financing activities
Repayment of bank loans
(149,385)
(46,273)
Payment of finance leases obligations
(60,619)
(16,221)
Dividends paid
(3,132,024)
(3,542,212)
Net cash used in financing activities
(3,342,028)
(3,604,706)
Net increase/(decrease) in cash and cash equivalents
152,681
(752,101)
Cash and cash equivalents at beginning of year
1,236,669
1,988,770
Cash and cash equivalents at end of year
1,389,350
1,236,669
Relating to:
Cash at bank and in hand
1,389,350
1,236,669
INDIGO LEISURE LIMITED
STATEMENT OF CASH FLOWS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
- 12 -
1
Judgements and key sources of estimation uncertainty

In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

 

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

2
Accounting policies
Company information

Indigo Leisure Limited is a private company limited by shares incorporated in England and Wales. The registered office is 63 Western Road, Hove, BN3 1JD.

2.1
Accounting convention

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.The financial statements are in compliance with FRS102.

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

The financial statements have been prepared under the historical cost convention, modified to include the revaluation of freehold properties and to include investment properties and certain financial instruments at fair value. The principal accounting policies adopted are set out below.

2.2
Revenue

Revenue is recognised at the fair value of the consideration received or receivable for goods provided in the normal course of business, and is shown net of VAT and other sales related taxes.

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.

2.3
Property, plant and equipment

Property, plant and equipment are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Freehold land and buildings
Straight line over 50 years
Short leasehold property
Straight line over the life of the lease
Fixtures, fittings & equipment
15% reducing balance
Motor vehicles
25% reducing balance

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.

INDIGO LEISURE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JULY 2024
2
Accounting policies
(Continued)
- 13 -
2.4
Impairment of non-current assets

At each reporting period end date, the company reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

 

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

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.

2.5
Inventories

Inventories 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 inventories to their present location and condition.

 

2.6
Cash and cash equivalents

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

2.7
Financial instruments

The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

 

Financial instruments are recognised in the company's statement of financial position when the company becomes party to the contractual provisions of the instrument.

 

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets

Basic financial assets, which include trade and other receivables and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

INDIGO LEISURE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
2
Accounting policies
(Continued)
- 14 -
Other financial assets

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

Impairment of financial assets

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

 

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

 

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

Derecognition of financial assets

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

Classification of financial liabilities

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.

Basic financial liabilities

Basic financial liabilities, including trade and other payables, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

 

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

 

Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade payables are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

INDIGO LEISURE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
2
Accounting policies
(Continued)
- 15 -
Other financial liabilities

Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.

 

Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

Derecognition of financial liabilities

Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.

2.8
Equity instruments

Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.

Changes in the fair value of derivatives that are designated and qualify as fair value hedges are recognised in profit or loss immediately, together with any changes in the fair value of the hedged asset or liability that are attributable to the hedged risk.

2.9
Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

Current tax

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the income statement because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date where transactions or events have occurred at that date that will result in an obligation to pay more, or a right to pay less or to receive more, tax, with the following exceptions:

 

Provision is made for tax on gains arising from the revaluation (and similar fair value adjustments) of fixed assets, and gains on disposal of fixed assets that have been rolled over into replacement assets.

 

Deferred tax assets are recognised only to the extent that the directors consider that it is more likely than not that there will be suitable taxable profits from which the future reversal of the underlying timing differences can be deducted.

 

Deferred tax is measured on an undiscounted basis at the tax rates that are expected to apply in the periods in which timing differences reverse, based on tax rates and laws enacted or substantively enacted at the balance sheet date.

INDIGO LEISURE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
2
Accounting policies
(Continued)
- 16 -
2.10
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 non-current assets.

 

2.11
Leases

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

 

Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the statement of financial position as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.

Rental income from operating leases is recognised on a straight line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight line basis over the lease term.

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.

3
Revenue

An analysis of the company's revenue is as follows:

2024
2023
£
£
Turnover
Turnover from principal activity
20,070,237
18,679,726
4
Auditor's remuneration
2024
2023
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the company
8,500
8,500
For other services
Taxation compliance services
3,000
3,000
All other non-audit services
52,699
42,454
55,699
45,454
INDIGO LEISURE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
- 17 -
5
Operating profit
2024
2023
Operating profit for the year is stated after charging/(crediting):
£
£
Depreciation of owned property, plant and equipment
644,006
431,238
Depreciation of property, plant and equipment held under finance leases
-
12,285
Profit/(loss) on disposal of property, plant and equipment
-
16,321
Cost of inventories recognised as an expense
6,815,068
6,110,423
Operating lease charges
1,419,597
1,271,326
6
Employees

The average monthly number of persons (including directors) employed by the company during the year was :

2024
2023
Number
Number
Directors
2
2
Administration staff
3
3
5
5

Their aggregate remuneration comprised:

2024
2023
£
£
Wages and salaries
131,982
102,729
Social security costs
8,531
1,531
Pension costs
1,807
910
142,320
105,170
Managers' franchise fees
4,143,004
3,773,389
4,285,324
3,878,559
7
Directors' remuneration
2024
2023
£
£
Remuneration for qualifying services
18,200
18,200
INDIGO LEISURE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
- 18 -
8
Finance costs
2024
2023
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
11,551
10,291
Other finance costs:
Interest on finance leases and hire purchase contracts
662
4,986
Other interest
4,238
9,104
16,451
24,381
9
Dividends
2024
2023
£
£
Interim paid
3,132,024
3,542,212
10
Taxation
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
1,117,915
623,357
Deferred tax
Origination and reversal of timing differences
159,092
45,459
Total tax charge
1,277,007
668,816

The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:

2024
2023
£
£
Profit before taxation
4,122,505
4,011,852
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00% (2023: 21.00%)
1,030,626
842,489
Tax effect of expenses that are not deductible in determining taxable profit
790
3,567
Permanent capital allowances in excess of depreciation
86,499
(222,699)
Deferred tax adjustment
159,092
45,459
Tax expense for the year
1,277,007
668,816
INDIGO LEISURE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
- 19 -
11
Intangible fixed assets
Goodwill
£
Cost
At 1 August 2023 and 31 July 2024
301,399
Amortisation and impairment
At 1 August 2023 and 31 July 2024
301,399
Carrying amount
At 31 July 2024
-
0
At 31 July 2023
-
0
12
Property, plant and equipment
Freehold land and buildings
Short leasehold property
Fixtures, fittings & equipment
Motor vehicles
Total
£
£
£
£
£
Cost or valuation
At 1 August 2023
1,617,277
3,470,280
5,563,708
208,491
10,859,756
Additions
-
0
60,425
251,894
-
0
312,319
At 31 July 2024
1,617,277
3,530,705
5,815,602
208,491
11,172,075
Depreciation and impairment
At 1 August 2023
299,307
1,620,469
3,017,500
71,036
5,008,312
Depreciation charged in the year
22,704
181,305
419,379
20,618
644,006
At 31 July 2024
322,010
1,801,773
3,436,881
91,654
5,652,318
Carrying amount
At 31 July 2024
1,295,267
1,728,932
2,378,721
116,837
5,519,757
At 31 July 2023
1,317,970
1,849,811
2,546,208
137,455
5,851,444

The carrying value of land and buildings comprises:

2024
2023
£
£
Freehold
1,295,267
1,317,970
Short leasehold
1,728,932
1,849,811
3,024,199
3,167,781
INDIGO LEISURE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
12
Property, plant and equipment
(Continued)
- 20 -

The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.

2024
2023
£
£
Motor vehicles
-
0
69,615
Depreciation charge for the year in respect of leased assets
-
12,285

The freehold land and buildings were valued on an open market basis by a firm of independent Chartered Surveyors in April 2018 in accordance with RICS Valuation Standard Manual.

Land and buildings are carried at valuation. If measured under the historic cost convention, the carrying amounts would be as follows:

 

Freehold property
2024
2023
£
£
Cost
1,303,357
1,303,357
Accumulated depreciation
(269,271)
(250,335)
Carrying value
1,034,086
1,053,022
13
Inventories
2024
2023
£
£
Finished goods and goods for resale
267,337
142,729
14
Trade and other receivables
2024
2023
Amounts falling due within one year:
£
£
Trade receivables
25,664
-
0
Amounts owed by group undertakings
6,452,505
6,168,222
Other receivables
113,948
147,417
Prepayments and accrued income
187,956
240,529
6,780,073
6,556,168
INDIGO LEISURE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
- 21 -
15
Current liabilities
2024
2023
Notes
£
£
Bank loans
16
-
0
48,145
Obligations under finance leases
17
-
0
60,619
Trade payables
683,311
607,681
Corporation tax
783,748
228,159
Other taxation and social security
205,041
128,544
Other payables
2,337
3,348
Accruals and deferred income
310,303
510,063
1,984,740
1,586,559
16
Borrowings
2024
2023
£
£
Bank loans
-
0
149,385
Payable within one year
-
0
48,145
Payable after one year
-
0
101,240
17
Finance lease obligations
2024
2023
Future minimum lease payments due under finance leases:
£
£
Within one year
-
0
61,161
Less: future finance charges
-
0
(542)
-
0
60,619
18
Non-current liabilities
2024
2023
Notes
£
£
Bank loans and overdrafts
16
-
0
101,240
INDIGO LEISURE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
- 22 -
19
Deferred taxation

Deferred tax assets and liabilities are offset where the company has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:

Liabilities
Liabilities
2024
2023
Balances:
£
£
Accelerated capital allowances
529,988
370,896
2024
2023
Movements in the year:
£
£
Liability at 1 August 2023
370,896
325,437
Charge to profit or loss
159,092
45,459
Liability at 31 July 2024
529,988
370,896

The deferred tax liability set out above relates to accelerated capital allowances that are expected to mature within the subsequent periods. An amount of £86,511 is expected to reverse the the next 12 months.

.

20
Share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary 'A' shares of £1 each
5,000
5,000
5,000
5,000
Ordinary 'B' shares of £1 each
5,000
5,000
5,000
5,000
10,000
10,000
10,000
10,000
21
Financial commitments, guarantees and contingent liabilities

The company has given a cross guarantee and debenture in the sum of £1.5 million in favour of its related company Indigo Leisure Investments Limited, in support of its borrowings.

INDIGO LEISURE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
- 23 -
22
Operating lease commitments
Lessee

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

2024
2023
£
£
Within one year
785,324
806,157
Between two and five years
3,081,129
3,119,129
In over five years
5,082,345
5,929,669
8,948,798
9,854,955
23
Directors' transactions

Dividends totalling £2,582,024 (2023 - £3,542,212) were paid in the year in respect of shares held by the company's directors.

24
Related party transactions
Remuneration of key management personnel

The remuneration of key management personnel is as follows.

2024
2023
£
£
Aggregate remuneration
18,200
18,200
Transactions with related parties
Purchase of services
2024
2023
£
£
Indigo Leisure Investments Ltd
810,775
810,775

The following amounts were outstanding at the reporting end date:

Amounts owed to related parties
2024
2023
£
£
Key management personnel
2,338
3,348
2,338
3,348
INDIGO LEISURE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
24
Related party transactions
(Continued)
- 24 -
Amounts owed by related parties
2024
2023
£
£
Entities over which the entity has control, joint control or significant influence:
Indigo Leisure Investments Ltd
6,452,505
6,168,222
6,452,505
6,168,222

No guarantees have been given or received. Amounts due will be settled in cash.

25
Ultimate controlling party

The parent company of Indigo Leisure Limited is YYZ Group Limited (Co. No. 13503660). The registered office of the parent company is 63 Western Road, Hove, East Sussex BN3 1JD.

 

The accounts of Indigo Leisure Limited are consolidated into the financial statements of YYZ Group Limited

The following are the parents of the largest and smallest groups in which this company's results are consolidated:

Largest group
YYZ Group Limited
Smallest group
YYZ Group Limited
26
Analysis of changes in net funds
1 August 2023
Cash flows
31 July 2024
£
£
£
Cash at bank and in hand
1,236,669
152,681
1,389,350
Borrowings excluding overdrafts
(149,385)
149,385
-
Obligations under finance leases
(60,619)
60,619
-
1,026,665
362,685
1,389,350
INDIGO LEISURE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
- 25 -
27
Cash generated from operations
2024
2023
£
£
Profit for the year after tax
2,845,498
3,343,036
Adjustments for:
Taxation charged
1,277,007
668,816
Finance costs
16,451
24,381
(Gain)/loss on disposal of property, plant and equipment
-
16,321
Depreciation and impairment of property, plant and equipment
644,006
443,523
Movements in working capital:
(Increase) in inventories
(124,608)
(14,428)
(Increase)/decrease in trade and other receivables
(223,905)
897,990
(Decrease)/increase in trade and other payables
(48,644)
267,215
Cash generated from operations
4,385,805
5,646,854
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