The directors present the strategic report for the year ended 31 December 2024.
The principal activity of the Group during the year was that of a holiday tour operator, mainly targeting the 50+ age bracket, with a broad range of escorted tours, cruises and events. There are no current plans for diversifying the main activities.
The business was pleased to see another year-on-year significant uplift in the revenue from its holiday packages departing in 2024, delivering just over £75.7M (up by over 30% from £58.2M in 2023). This growth was achieved through a combination of an increase in the average price per person of 17% and an increase in departed passengers of over 11% to nearly 46,000.
Long haul destinations continued their strong growth since the COVID-19 pandemic, with a 23% increase in departed passengers and 39% increase in revenue, compared to 2023, out-performing short haul on total revenue for the first ever time. This growth was particularly supported by the success of a selection of brand-new safari tours in southern Africa, however most long haul regions saw material year on year revenue growth.
The growth in top-line figures was supported by a number of successful operational efficiency initiatives below the line enabling improved margins. The increased focus on service which began in 2022 also gained further momentum, with the Trustpilot score improving from 4.7 to a sector high 4.8.
The directors were pleased to see that, through a combination of growth in revenue, operational efficiency initiatives and continuous service improvement, the business achieved its highest profit performance in its 42-year history.
Whilst the ‘cost of living’ crisis continued through 2024, alongside high inflation levels, the business has found its customer demographic to be far less impacted by these challenges and is pleased to see forward trading continue to improve.
The business has delivered a new web platform, which is supporting growth through direct, trade and internal sales channels. The business also launched a new Premier Collection concept in Q2 2024, following survey feedback suggesting 1 in 3 customers having a specific interest in this concept.
In October 2024, the Group was acquired by Blossom Bidco Ltd, following investment interest in the business from a number of different investment houses. The Group is already benefiting from support and advice from the new Non-Executive Directors along with the Investment House as it continues to refine the opportunities for growth to take the Group to the next level.
The main risks that may affect the performance of the company continue to be external, with the wars in Ukraine and the Middle East, trade war between USA and China, ongoing inflation and the ‘cost of living crisis’ seen as the biggest uncertainties at this time. The business continues to mitigate against these risks through product innovation and a focus on negotiation with key supply partners. The business believes that it is already well placed to respond to these risks, and that its targeted customer demographic is more protected against these uncertainties than most other customer groupings.
The UK travel industry continues to be highly competitive, and industry margins are consequently tight. The company maintains its approach to meeting this risk by an innovative and structured approach to product development and distribution, such that many of the company's packages are not readily available from other businesses. The group's profitability is also influenced by the GBP exchange rate environment, particularly in relation to EUR and USD. The group mitigates this risk by hedging its currency exposure.
At the year ended 31 December 2024, the company's financial position is healthy. The company's staff and management are committed and expert. The company's suppliers are long-standing and loyal. On these foundations the directors believe there is considerable scope for further development of the business.
Financial Risk Management
Credit Risk
Both customers and Travel Agents pay in advance of receiving the holiday, thus non-payment issues are avoided as customers are not issued with tickets prior to receiving the final balance for their holiday.
For suppliers, credit checks are undertaken using Creditsafe to ensure that each supplier is financially robust and for key suppliers a credit alert is in place. Any material prepayments require authorisation from the CFO.
Liquidity Risk
The Group mitigates liquidity risk through the use of a daily cashflow forecast that is built from historical movements and is regularly reviewed by both the Financial Controller and the CFO. As part of the review, monies in notice accounts are regularly put on notice to ensure sufficient funds are available to meet payment runs and currency purchases.
Interest Rate Risk
The Group invests surplus cash in notice deposit accounts. The Group’s interest income is therefore affected by the movement in interest rates.
Regulation Risk
The sale of travel and holiday arrangements is a highly regulated industry. The Group seeks to manage the associated risks by constantly monitoring changes, attending update seminars, adapting terms of trade and the business model as required.
Technology Risk
The Group has undertaken a review of it’s technology infrastructure and uses an Information Security company (DataGuard) to help ensure best practice is followed. In addition, the Group has taken out Cyber insurance which both covers risk and provides assistance in the event of a cyber breach.
Stakeholder Engagement
The board of directors consider that the decision they have made during the financial year and the way they acted have promoted the success of the Group for the benefit of its stakeholders. The Board meets on a monthly basis to review the management accounts for the Group with standing items on the agenda covering areas such as current trading, customer feedback, employee engagement and review of the business plan delivery. The Board considers the company’s key stakeholders to include employees, customers, suppliers, and shareholders.
Principal decisions taken by the Board during the period
The Board meet on a regular basis to evaluate longer term strategic direction and agree levels and areas for investment. The decision-making process takes into account, financial benefit to the group, as well as the long term effect on the Group’s going concern, service for our customers, development of employees and the environment. The approach to all stakeholders is one of mutually beneficial partnership where sustained returns and good long term relationships are key.
During the 2024 financial period, the Board considered a wide range of matters affecting both the short term and long term future of the Group. Whilst the matters varied throughout the period, the approach to reviewing them was through the Newmarket Holidays Brand bullseye and the framework of PACERS (People, Acquisition, Conversion, Efficiency, Responsibility & Service).
We set out below how we engaged with all key stakeholders during the period to communicate strategy and take onboard stakeholder feedback.
Customer & Suppliers
We engage with our customers through various channels (Retail, call centre and online). The focus is 100% on customer satisfaction, with continual innovation to our service delivery at all customer touch points.
We maintain open and regular communication with our key suppliers as well as holding training days for both our employees and our suppliers' employees as appropriate. In addition, we engage constructively to set clear and balanced expectations of our supplier relationships through contracts, agreements and service levels.
Employees
Our employees are key to the success of the Group and future growth. The Board aims to be a responsible employer, ensuring that pay and benefits are fair, consistent and competitive. The health, safety and well-being of employees is a primary focus of the board and is supported by quarterly employee surveys. After each survey, as appropriate actions are taken to improve employee engagement and address areas of employee concern.
Each month a Town Hall is held for all employees, where business updates, new products and employee awards are shared.
Trading Updates
The Board considers trading performance from across the Group’s operations, discussing performance from both a booking and departure perspective, along with a review of margins by product type.
Financial Updates
The Board discusses performance against budget and a rolling forecast, understanding the drivers of both out and under performance. In addition, working capital and the liquidity position are reviewed to ensure they are sufficient for both the Group’s and regulatory requirements.
On behalf of the board
The directors present their annual report and financial statements for the year ended 31 December 2024.
The results for the year are set out on page 11.
No ordinary dividends were paid. The directors do not recommend payment of a further dividend.
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
In the years ahead the directors believe that there is considerable scope for the development of the existing activities of the group. There are no current plans for the diversification of activities.
As the large company within the group has not consumed more than 40,000 kWh of energy in this reporting period, it qualifies as a low energy user under these regulations and is not required to report on its emissions, energy consumption or energy efficiency activities.
We have audited the financial statements of Newmarket Promotions Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2024 which comprise the group income statement, the group statement of comprehensive income, the group statement of financial position, the company statement of financial position, the group statement of changes in equity, the company statement of changes in equity, the group 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).
Basis for 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 group's and parent 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
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.
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.
We are not responsible for preventing non-compliance and cannot be expected to detect non compliance with all laws and regulations - this responsibility lies with management with the oversight of the directors.
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
We identified areas of laws and regulations that could reasonably be expected to have a material effect on the financial statements from our sector experience through discussion with management (as required by auditing standards).
We had regard to laws and regulations in areas that directly affect the financial statements including financial reporting and taxation legislation. We considered that extent of compliance with those laws and regulations as part of our procedures on the related financial statement items.
With the exception of any known or possible non-compliance, and as required by auditing standards, our work in respect of these included enquiry of management about company's policies, procedures and related controls regarding compliance with laws and regulations and if there are any known instances of non-compliance.
We tested the appropriateness of journal entries and other adjustments; assessing whether the judgements made in making accounting estimates are indicative of a potential bias; and evaluated the business rationale of any significant transactions that are unusual or outside the normal course of business.
We performed analytical procedures to identify any unusual or unexpected relationships.
We examined supporting documents for all material balances, transactions and disclosures.
We evaluated the selection and application of accounting policies related to subjective measurements and complex transactions.
We reviewed the Board of directors minutes.
Owing to the inherent limitations of an audit, there is an unavoidable risk that some material misstatements of the financial statements may not be detected, even though the audit is properly planned and performed in accordance with the ISAs (UK).
The potential effects of inherent limitations are particularly significant in the case of misstatement resulting from fraud because fraud may involve sophisticated and carefully organized schemes designed to conceal it, including deliberate failure to record transactions, collusion or intentional misrepresentations being made to us.
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.
As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £143,063 (2023 - £1,178 profit).
These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.
Newmarket Promotions Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is Cantium House, Railway Approach, Wallington, SM6 0BP.
The group consists of Newmarket Promotions Limited and all of its subsidiaries.
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention, modified to include certain financial instruments at fair value. The principal accounting policies adopted are set out below.
The consolidated group financial statements consist of the financial statements of the parent company Newmarket Promotions Limited together with all entities controlled by the parent company (its subsidiaries) and the group’s share of its interests in joint ventures and associates.
All financial statements are made up to 31 December 2024. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.
All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.
At the time of approving the financial statements, the directors have a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
Turnover represents the aggregate value receivable, net of discounts, from inclusive tours, commissions and other travel services excluding VAT. Turnover, when acting as the principal tour operator, is recognised at the point of departure, where commission receivable when acting as an agent is recognised at the point of booking. Where payments are received from customers in advance of departure, the amounts are recorded as deferred income and included as part of creditors within the year.
Research expenditure is written off against profits in the year in which it is incurred. Identifiable development expenditure is capitalised to the extent that the technical, commercial and financial feasibility can be demonstrated.
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 recognised in the income statement.
Interests in subsidiaries are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.
Other fixed asset investments are measured at fair value with changes in fair value being recognised through profit or loss.
The group 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 group's statement of financial position when the group becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset and 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, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
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.
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.
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the group 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.
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 group after deducting all of its liabilities.
Basic financial liabilities, including creditors, 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 creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
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 though 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.
Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.
Equity instruments issued by the group 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 group.
The company designates certain hedging instruments, including derivatives, embedded derivatives and non-derivatives, as either fair value hedges or cash flow hedges.
At the inception of the hedge relationship, the company documents the relationship between the hedging instrument and the hedged item along with risk management objectives and strategy for undertaking various hedge transactions. At the inception of the hedge and on an ongoing basis, the company documents whether the hedging instrument is highly effective in offsetting changes in fair values or cash flows of the hedged item.
Fair value hedges
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.
Cash flow hedges
The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges is recognised in other comprehensive income.
The gain or loss relating to the ineffective portion is recognised immediately in profit or loss, and is included in the 'other gains and losses' line in this item.
Amounts previously recognised in other comprehensive income and accumulated in equity are reclassified to profit or loss in the periods when the hedged item is recognised in the profit or loss in the same line as of the income statement as the recognised hedged item. However when the forecast transaction that is hedged results in the recognition of a non-financial asset or liability, the gains and losses previously accumulated in equity are transferred from equity and included in the initial measurement of the cost of the asset or liability concerned.
The tax expense represents the sum of the tax currently payable and deferred 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 liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the income statement, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
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 leased asset are consumed.
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions for administrative expenses, and at rates published in the Newmarket Holidays brochures for the departure year to which they relate in accordance of the requirements of HMRC’s Tour Operators Margin Scheme legislation. 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 are included in the income statement for the period.
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.
Accounts and transactions that include key estimates are amortisation of tangible and intangible fixed assets (requiring an estimate of the useful life of the asset), deferred tax asset (requiring an estimate of the recoverability of tax losses which is based on current levels of profitability and future forecasts), the cashflow hedging reserve (requiring an estimate of foreign currency requirements in respect of future transactions) and a cancellations provision against commission accrued in respect of bookings for holidays that have not departed as at the Balance Sheet date (requiring an estimate of cancellation rates which is based on cancellation levels in prior years)
The whole of turnover and profit before tax is attributable to the one principal activity being holiday tour operators.
All turnover arose within the United Kingdom.
The average monthly number of persons (including directors) employed by the group and company during the year was:
Their aggregate remuneration comprised:
The number of directors for whom retirement benefits are accruing under defined contribution schemes is 5 (2023 - 5).
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:
The carrying value of land and buildings comprises:
Details of the company's subsidiaries at 31 December 2024 are as follows:
Details of financial instruments are provided at group level only because, as permitted by the reduced disclosure framework within FRS 102, the company has taken advantage of the exemption from disclosing the carrying amount of certain classes of financial instruments.
The group designates certain derivative financial instruments as cash flow hedges of certain forecast transactions. These transactions are highly probable to occur and present an exposure to variations in cash flows that could ultimately affect amounts determined in profit and loss.
The group has elected to adopt the general Hedge accounting model in FRS 102. This requires the group to ensure that hedge accounting relationships are aligned with its risk management objectives and strategy and to apply a qualitative and forward-looking approach to assessing hedge effectiveness.
The group uses forward foreign exchange contracts to hedge the variability in cash flows arising from the changes in foreign currency rates. For foreign exchange contracts, the group designates the fair value change of the full forward price as the hedging instrument in cash flow hedging relationships. The effective portion of changes in fair value of hedging instruments is recognised in other comprehensive income and amounted to £(21,326) (2023: £(385,784)). This is accumulated in a cash flow hedge reserve as a separate component of equity. At the year end the fair value of the amount hedged is £(235,853) (2023: £(214,527)) Any ineffective portion of the fair value gain or loss is recognised immediately within the income statement.
When a hedging instrument no longer meets the criteria for hedge accounting, through maturity, sale, or other termination, hedge accounting is discontinued prospectively. If the hedged forecast transaction is still expected to occur, the associated cumulative gain or loss remains in the hedging reserve and is recognised in accordance with the above policy when the transaction occurs. If the hedged transaction is no longer expected to occur, the cumulative unrealised gain or loss is recognised in the income statement immediately.
The following are the major deferred tax liabilities and assets recognised by the group and company, and movements thereon:
A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.
This reserve represents the premium paid on the issue of new shares.
This reserve records retained earning and accumulated losses.
This reserve relates to the amount of gain or loss recognised on forward contracts and derivatives that are cash flow hedges for committed foreign exchange transactions occurring in the 12 months post year end.
Other reserves represents a capital contributions reserve in respect of shares issued to employees of the company in a share based payment scheme operated by the parent company.
Certain assets of the group are subject to a fixed and floating charge to guarantee the borrowings of a fellow group company, the value of which at the Balance Sheet date, stood at £24,573,849.
At the reporting end date the group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows: