Company Registration No. 13695686 (England and Wales)
LQ SPA & GOLF RESORTS LIMITED
ANNUAL REPORT AND
FINANCIAL STATEMENTS
FOR THE PERIOD FROM 16 JUNE 2022 TO
30 NOVEMBER 2023
LQ SPA & GOLF RESORTS LIMITED
COMPANY INFORMATION
Directors
Dr A Bansal
Mrs S Bansal
Mr C R Jenno
Mrs P Walker
Company number
13695686
Registered office
Lion Quays Hotel & Spa
Weston Rhyn
Gobowen
Oswestry
Shropshire
SY11 3EN
Auditor
Morris Lane
31/33 Commercial Road
Poole
Dorset
BH14 0HU
LQ SPA & GOLF RESORTS LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2 - 3
Directors' responsibilities statement
4
Independent auditor's report
5 - 7
Income statement
8
Group statement of comprehensive income
9
Group statement of financial position
10
Company statement of financial position
11
Group statement of changes in equity
12
Company statement of changes in equity
13
Group statement of cash flows
14
Notes to the financial statements
15 - 36
LQ SPA & GOLF RESORTS LIMITED
STRATEGIC REPORT
FOR THE PERIOD ENDED 30 NOVEMBER 2023
- 1 -
The directors present the strategic report for the period ended 30 November 2023.
Fair review of the business
To enable streamlined auditing and consistency in reporting, the group changed its year-end to align with the LQ Group, moving from 15 June to 30 November.
Ufford Park Limited was acquired on 16 June 2022. This wholly owned subsidiary owns and operates a hotel.
Since acquisition, the hotel has benefited from substantial investments in its spa and leisure facilities, as well as further improvements to the driving range. Significant enhancements included:
- Creation of eight new treatment rooms, including two non-therapist experiences, enhancing the range of services offered to guests.
- Development of a new arrival area for guests, complemented by a separate reception area featuring a retail shop, aimed at improving the guest experience from the moment of arrival.
- Establishment of a new deep relaxation area, providing guests with a tranquil space to unwind.
- Extension of the gym footprint, allowing for a more spacious and accommodating fitness environment.
- Addition of a new studio area at the rear of the main gym floor, designed to support a variety of fitness classes and activities.
- Installation of new Technogym equipment and wellness system technology throughout the facility, ensuring that guests have access to state-of-the-art fitness and wellness resources.
Despite the refurbishment disruptions, which spanned over five months, and the continued pressure from the previous year’s increase in utility costs, the hotel managed to maintain year-on-year overall revenue at comparable levels and the group made a profit before tax of £34,714 for the period. The balance sheet shows net assets of £51,973 at 30 November 2023 with the hotel valued at £8.6m on 18 September 2023 by Savills, an independent valuer.
Changes in compliance requirements and potential legal challenges necessitated the introduction of new Training and H&S software and tracking platforms. These measures were implemented to mitigate uncertainties and manage additional costs effectively.
The rapid pace of technological and marketing change underscores the need for continuous investment, and there is a commitment to making these necessary enhancements throughout 2024 and 2025 to maintain a competitive edge.
Principal risks and uncertainties
The hotel and leisure sector faces several ongoing risks and uncertainties. The economic downturn, changes in consumer spending patterns, and fluctuations in tourism significantly impact our industry. Additionally, the continued fluctuations in the Bank of England interest rates, pose further challenges.
The directors are keenly aware of these risks and are proactively managing them. Close monitoring of working capital requirements and strategic product investment will secure a stable future for the hotel.
Mrs P Walker
Director
6 June 2025
LQ SPA & GOLF RESORTS LIMITED
DIRECTORS' REPORT
FOR THE PERIOD ENDED 30 NOVEMBER 2023
- 2 -
The directors present their annual report and financial statements for the period ended 30 November 2023.
Principal activities
The principal activity of the group is that of running of Ufford Park Hotel, Golf & Spa.
Results and dividends
The results for the period are set out on page 8.
No ordinary dividends were paid. The directors do not recommend payment of a final dividend.
Directors
The directors who held office during the period and up to the date of signature of the financial statements were as follows:
Dr A Bansal
Mrs S Bansal
Mr C R Jenno
Mrs P Walker
Price risk, credit risk, liquidity risk and cash flow risk
The group aims to mitigate liquidity risk and cash flow risk by managing working capital, and as a result, it continues to closely monitor the working capital requirements. In addition, the directors continue to work with group's bank to ensure that these working capital requirements are met.
Future developments
Future developments include a continuing program of refurbishment in order to maintain standards and increase revenue. In addition, there is an ongoing centralisation and restructure of resources for cost saving efficiencies. The company continues to invest in staff welfare, training and development along with improved staff communication to ensure that the key policy of maintaining high customer service and satisfaction is met. In addition, there is an emphasis on fostering business relationships with supplier to maintain cost control.
Auditor
Morris Lane were appointed as auditor to the group and in accordance with section 485 of the Companies Act 2006, a resolution proposing that they be re-appointed will be put at a General Meeting.
Strategic report
The truegroup has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the group'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 fair review of the business.
Statement of disclosure to auditor
The directors of the company confirm that all relevant information has been disclosed to the auditors. Each director has taken all necessary steps to ensure that they are aware of any relevant audit information and to establish that the company’s auditors are aware of this information. To the best of their knowledge, there is no information relevant to the audit of which the auditors are unaware. This thorough disclosure ensures transparency and supports the integrity of the company’s financial reporting.
LQ SPA & GOLF RESORTS LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE PERIOD ENDED 30 NOVEMBER 2023
- 3 -
On behalf of the board
Mrs P Walker
Director
6 June 2025
LQ SPA & GOLF RESORTS LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE PERIOD ENDED 30 NOVEMBER 2023
- 4 -
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 group and company, 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 and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the group and company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the group’s and company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and 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 group and company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
LQ SPA & GOLF RESORTS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF LQ SPA & GOLF RESORTS LIMITED
- 5 -
Opinion
We have audited the financial statements of LQ Spa & Golf Resorts Limited (the 'parent company') and its subsidiaries (the 'group') for the period ended 30 November 2023 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 FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
give a true and fair view of the state of the group's and the parent company's affairs as at 30 November 2023 and of the group's loss for the period then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.
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 group and the parent 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 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.
The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit:
the information given in the strategic report and the directors' report for the financial period 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.
LQ SPA & GOLF RESORTS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF LQ SPA & GOLF RESORTS LIMITED
- 6 -
Matters on which we are required to report by exception
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 strategic report and the directors' report.
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:
adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or
the parent company financial statements are not in agreement with the accounting records and returns; or
certain disclosures of directors' remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the 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 parent 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.
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.
Identifying and assessing the risks of material misstatement due to irregularities, including fraud
We obtained an understanding of the legal and regulatory frameworks that are applicable to the group and the parent company through discussion with the directors and from our general commercial experience. The identified laws and regulations were communicated to the audit team in order that they remained alert to any non-compliance throughout the audit.
The group and parent company are subject to laws and regulations which have a direct effect on the financial statements and the disclosures contained therein. These have been identified as: the financial reporting framework under which the group and company operates - Financial Reporting Standard 102; Statutory Instrument 2008/410 – The Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008; the Companies Act 2006 and taxation legislation including pay as you earn; value added tax; corporation tax and pensions legislation.
In addition to the above, the group and parent company are subject to other operational laws and regulations where non-compliance may have a material effect on the financial statements. Non-compliance of such laws and regulations may result in litigation, the imposition of fines or the closure of the business which could have a material impact on amounts or disclosures in the financial statements. We have identified the following laws and regulations which are more likely to have significant effect as: compliance with licencing laws; food hygiene laws; health and safety laws; General Data Protection Regulation (GDPR) and employment law.
LQ SPA & GOLF RESORTS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF LQ SPA & GOLF RESORTS LIMITED
- 7 -
Audit procedures designed to respond to the risks of material misstatement due to irregularities, including fraud
We considered the extent of compliance with these laws and regulations as part of our audit procedures on the related financial statements items including a review of financial statements disclosures. We reviewed the group and parent company's records of breaches of laws and regulations, minutes of meetings and correspondence with relevant authorities to identify potential material misstatements arising. We discussed the group and parent company's policies and procedures for compliance with laws and regulations with members of management responsible for compliance.
During the planning meeting with the audit team, the senior statutory auditor drew attention to the key areas which might involve non-compliance with laws and regulations or fraud. We enquired of management whether they were aware of any instances of non-compliance with laws and regulations or knowledge of any actual, suspected or alleged fraud. We addressed the risk of fraud through management override of controls by testing the appropriateness of journal entries and identifying any significant transactions that were unusual or outside the normal course of business. We assessed whether judgements made in making accounting estimates gave rise to possible indication of management bias. At the completion stage of the audit, the senior statutory auditor's review included ensuring that the team had approached their work with appropriate professional scepticism and thus the capacity to identify non-compliance with laws and regulations and fraud.
Auditing standards limit the audit procedures required to identify non-compliance with other operational laws and regulations to enquiry of directors and management and inspection of any correspondence. If a breach of operational regulations is not evident from relevant correspondence or disclosed to us, an audit is unlikely to detect that breach. In addition, the further removed non-compliance with laws and regulations is from the events and transactions included in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting to an error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion.
Due to the inherent limitations of an audit, there is an unavoidable risk that, despite properly planning and performing our audit in accordance with accounting standards, some material misstatements may not have been detected.
In addition, the risk of not detecting material misstatement from due to fraud is higher than the risk of one not being detected through error as fraud may involve deliberate concealment through collusion, forgery, misrepresentations and intentional omissions.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.
Michelle Pettifer (Senior Statutory Auditor)
For and on behalf of Morris Lane
6 June 2025
Chartered Accountants
Statutory Auditor
31/33 Commercial Road
Poole
Dorset
BH14 0HU
LQ SPA & GOLF RESORTS LIMITED
GROUP INCOME STATEMENT
FOR THE PERIOD ENDED 30 NOVEMBER 2023
- 8 -
Period
Period
ended
ended
30 November
15 June
2023
2022
Notes
£
£
Revenue
3
8,120,392
-
Cost of sales
(4,944,940)
Gross profit
3,175,452
-
Administrative expenses
(2,561,445)
Operating profit
4
614,007
-
Finance costs
8
(579,293)
Profit before taxation
34,714
-
Tax on profit
9
(48,054)
Loss for the financial period
24
(13,340)
(Loss)/profit for the financial period is all attributable to the owners of the parent company.
The income statement has been prepared on the basis that all operations are continuing operations.
LQ SPA & GOLF RESORTS LIMITED
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE PERIOD ENDED 30 NOVEMBER 2023
- 9 -
Period
Period
ended
ended
30 November
15 June
2023
2022
£
£
Loss for the period
(13,340)
Other comprehensive income
Revaluation of property, plant and equipment
69,471
Tax relating to other comprehensive income
(4,258)
Other comprehensive income for the period
65,213
Total comprehensive income for the period
51,873
Total comprehensive income for the period is all attributable to the owners of the parent company.
LQ SPA & GOLF RESORTS LIMITED
GROUP STATEMENT OF FINANCIAL POSITION
AS AT
30 NOVEMBER 2023
30 November 2023
- 10 -
30 November 2023
15 June 2022
Notes
£
£
£
£
Non-current assets
Goodwill
10
629,866
Property, plant and equipment
11
8,600,000
9,229,866
-
Current assets
Inventories
15
60,694
-
Trade and other receivables
16
392,813
-
Cash and cash equivalents
33,981
100
487,488
100
Current liabilities
17
(3,954,520)
-
Net current assets/(liabilities)
(3,467,032)
100
Total assets less current liabilities
5,762,834
100
Non-current liabilities
18
(5,016,504)
-
Provisions for liabilities
Deferred tax liability
21
694,357
(694,357)
-
Net assets
51,973
100
Equity
Called up share capital
23
100
100
Revaluation reserve
24
59,173
Retained earnings
24
(7,300)
Total equity
51,973
100
The financial statements were approved by the board of directors and authorised for issue on 6 June 2025 and are signed on its behalf by:
06 June 2025
Mrs P Walker
Director
LQ SPA & GOLF RESORTS LIMITED
COMPANY STATEMENT OF FINANCIAL POSITION
AS AT 30 NOVEMBER 2023
30 November 2023
- 11 -
30 November 2023
15 June 2022
Notes
£
£
£
£
Non-current assets
Investments
12
4,572,071
Current assets
Trade and other receivables
16
2,529,773
Cash and cash equivalents
2,642
100
2,532,415
100
Current liabilities
17
(2,854,179)
-
Net current assets (liabilities)
(321,764)
100
Total assets less current liabilities
4,250,307
100
Non-current liabilities
18
(4,773,644)
-
Net assets (liabilities)
(523,337)
100
Equity
Called up share capital
23
100
100
Retained earnings
24
(523,437)
Total equity
(523,337)
100
As permitted by s408 Companies Act 2006, the company has not presented its own income statement and related notes. The company’s loss for the year was £523,437 (15 June 2022 - £0 profit).
The financial statements were approved by the board of directors and authorised for issue on 6 June 2025 and are signed on its behalf by:
06 June 2025
Mrs P Walker
Director
Company Registration No. 13695686
LQ SPA & GOLF RESORTS LIMITED
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 30 NOVEMBER 2023
- 12 -
Share capital
Revaluation reserve
Retained earnings
Total
Notes
£
£
£
£
Balance at 21 October 2021
-
Period ended 15 June 2022:
Profit and total comprehensive income for the period
-
-
-
-
Issue of share capital
23
100
-
-
100
Balance at 15 June 2022
100
100
Period ended 30 November 2023:
Loss for the period
-
-
(13,340)
(13,340)
Other comprehensive income:
Revaluation of property, plant and equipment
-
69,471
-
69,471
Tax relating to other comprehensive income
-
(4,258)
(4,258)
Total comprehensive income for the period
-
65,213
(13,340)
51,873
Transfers
-
(6,040)
6,040
-
Balance at 30 November 2023
100
59,173
(7,300)
51,973
LQ SPA & GOLF RESORTS LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 30 NOVEMBER 2023
- 13 -
Share capital
Retained earnings
Total
Notes
£
£
£
Balance at 21 October 2021
-
Period ended 15 June 2022:
Profit and total comprehensive income for the period
-
-
Issue of share capital
23
100
-
100
Balance at 15 June 2022
100
100
Period ended 30 November 2023:
Loss and total comprehensive income for the period
-
(523,437)
(523,437)
Balance at 30 November 2023
100
(523,437)
(523,337)
LQ SPA & GOLF RESORTS LIMITED
GROUP STATEMENT OF CASH FLOWS
FOR THE PERIOD ENDED 30 NOVEMBER 2023
- 14 -
30 November 2023
15 June 2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
29
1,179,902
-
Interest paid
(554,961)
Loan arrangement fees paid
(48,750)
-
Income taxes paid
(143,132)
-
Net cash inflow from operating activities
433,059
-
Investing activities
Purchase of subsidiary
(3,650,948)
-
Purchase of property, plant and equipment
(1,033,038)
-
Proceeds on disposal of property, plant and equipment
(7,024)
-
Net cash used in investing activities
(4,691,010)
-
Financing activities
Proceeds from issue of shares
-
100
Increase in loans from related parties
2,698,304
-
Repayment of old bank loan
(3,164,416)
-
Proceeds of new bank loan
4,875,000
-
Repayment of new bank loan
(24,080)
-
Payment of finance leases obligations
(92,976)
-
Net cash generated from financing activities
4,291,832
100
Net increase in cash and cash equivalents
33,881
100
Cash and cash equivalents at beginning of period
100
Cash and cash equivalents at end of period
33,981
100
LQ SPA & GOLF RESORTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 30 NOVEMBER 2023
- 15 -
1
Accounting policies
Company information
LQ Spa & Golf Resorts Limited is a private company limited by shares incorporated in England and Wales. The registered office is Lion Quays Hotel & Spa, Weston Rhyn, Gobowen, Oswestry, Shropshire, SY11 3EN.
The group consists of LQ Spa & Golf Resorts Limited and its subsidiary.
1.1
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 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 at fair value. The principal accounting policies adopted are set out below.
The company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements for parent company information presented within the consolidated financial statements:
Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;
Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues: The disclosure requirements of paragraphs 11.42, 11.44, 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b), 11.48(c), 12.26, 12.27, 12.29(a), 12.29(b), and 12.29A;
Section 26 ‘Share based Payment’: Share based payment arrangements required under FRS 102 paragraphs 26.18(b), 26.19 to 26.21 and 26.23;
Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.
1.2
Business combinations
In the parent company financial statements, the cost of a business combination is the fair value at the acquisition date of the assets given, equity instruments issued and liabilities incurred or assumed, plus costs directly attributable to the business combination. The excess of the cost of a business combination over the fair value of the identifiable assets, liabilities and contingent liabilities acquired is recognised as goodwill. The cost of the combination includes the estimated amount of contingent consideration that is probable and can be measured reliably, and is adjusted for changes in contingent consideration after the acquisition date. Provisional fair values recognised for business combinations in previous periods are adjusted retrospectively for final fair values determined in the 12 months following the acquisition date. Investments in subsidiaries, joint ventures and associates are accounted for at cost less impairment.
Deferred tax is recognised on differences between the value of assets (other than goodwill) and liabilities recognised in a business combination accounted for using the purchase method and the amounts that can be deducted or assessed for tax, considering the manner in which the carrying amount of the asset or liability is expected to be recovered or settled. The deferred tax recognised is adjusted against goodwill or negative goodwill.
LQ SPA & GOLF RESORTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 NOVEMBER 2023
1
Accounting policies
(Continued)
- 16 -
1.3
Basis of consolidation
The consolidated group financial statements consist of the financial statements of the parent company LQ Spa & Golf Resorts Limited together with all entities controlled by the parent company (its subsidiaries).
All financial statements are made up to 30 November 2023. 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.
Subsidiaries are consolidated in the group's financial statements from the date that control commences until the date that control ceases.
1.4
Going concern
The directors have carefully considered those factors likely to affect the future development, performance and financial position of the group and parent company in relation to the ability of the group and parent company to operate within its current and foreseeable financial and operational resources.
The directors have adopted the going concern basis in preparing these accounts after assessing the principal risks applicable to the group and parent company. These include rising inflation, rising interest rates, staff shortages as a result of Brexit, the increase in the National Living Wage for employees over the age of 21, the cost of living crisis and higher insurance premiums.
The group and parent company's forecasts and projections, after taking into account continued support form its bank and directors, show that the group and company should be able to meet its liabilities as the fall due for a period of at least 12 months from the date of signing these financial statements. Accordingly, the directors have the expectation that the group and parent company will be in a position to manage its financing and business risks satisfactorily. Overall, the directors do not consider there to be a cause for material uncertainty regarding the group and parent company’s going concern status as at the date of signing these financial statements.
1.5
Reporting period
The accounting reference date has been extended from 15 June 2023 to 30 November 2023 in order to facilitate a more accurate reporting function within the business. As a result, the comparative amounts presented in the financial statements (including the related notes) are not entirely comparable.
1.6
Revenue
Revenue is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.
LQ SPA & GOLF RESORTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 NOVEMBER 2023
1
Accounting policies
(Continued)
- 17 -
Revenue is recognised as follows:
Rooms
Revenue is recognised when the rooms are occupied.
Food and beverages
Revenue is recognised at the point of sale, when the food and beverages have been provided.
Golf, health club and spa memberships
Revenue is recognised over the period of membership.
Golf green fees and shop income, health club and spa treatments and products
Revenue is recognised when the goods or service has been provided.
Deferred revenue consisting of deposits paid in advance are recognised on the day that the services are performed.
1.7
Intangible fixed assets - goodwill
Goodwill represents the excess of the cost of acquisition of a business over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is 10 years.
For the purposes of impairment testing, goodwill is allocated to the cash-generating units expected to benefit from the acquisition. Cash-generating units to which goodwill has been allocated are tested for impairment at least annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit.
1.8
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
2% straight line
Plant and machinery
10% - 25% straight line
Fixtures and fittings
10% - 25% straight line
Health & spa equipment
10% - 20% straight line
Golf equipment
10% - 20% straight line
Freehold land is not depreciated.
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.
1.9
Non-current investments
In the parent company financial statements, investments in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.
LQ SPA & GOLF RESORTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 NOVEMBER 2023
1
Accounting policies
(Continued)
- 18 -
A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
1.10
Impairment of non-current assets
At each reporting period end date, the group 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.
The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.
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.
1.11
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.
At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of inventories over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.
1.12
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.
LQ SPA & GOLF RESORTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 NOVEMBER 2023
1
Accounting policies
(Continued)
- 19 -
1.13
Financial instruments
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
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.
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 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.
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 group after deducting all of its liabilities.
LQ SPA & GOLF RESORTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 NOVEMBER 2023
1
Accounting policies
(Continued)
- 20 -
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.
Derecognition of financial liabilities
Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.
1.14
Equity instruments
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.
1.15
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 group’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 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 if, and only if, there is 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.
LQ SPA & GOLF RESORTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 NOVEMBER 2023
1
Accounting policies
(Continued)
- 21 -
1.16
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.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
1.17
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.18
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.
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.
2
Judgements and key sources of estimation uncertainty
In the application of the group’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.
Key sources of estimation uncertainty
The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.
Fair value, residual value and depreciation of freehold property
Freehold property represents the company's most significant asset and is assessed to have a useful life of 50 years and is carried at a revalued amount, being its fair value at the date of revaluation less any subsequent depreciation.
The value of the freehold property as at 30 November 2023 was determined based on an external valuation, having regards to factors such as current and future projected income levels, location and recent market transactions in the sector. Carrying value is then calculated on the basis of estimates and of useful life and residual value of the company's property which are determined by management and reviewed annually for appropriateness.
LQ SPA & GOLF RESORTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 NOVEMBER 2023
2
Judgements and key sources of estimation uncertainty
(Continued)
- 22 -
Goodwill amortisation
Goodwill arising from the acquisition of the subsidiary is amortised over its estimated useful life of 10 years. The useful life is determined based on expected duration of economic benefit from the hotel. Goodwill is tested annually for impairment. These assessments involve significant estimates and assumptions on projected future cash flows, discount rates and growth rates. Any changes to these assumptions could lead to material adjustments to the carrying amount of goodwill.
3
Revenue
An analysis of the group's revenue is as follows:
Period
Period
ended
ended
30 November
15 June
2023
2022
£
£
Revenue analysed by class of business
Rooms
3,167,230
-
Food and beverages
2,543,233
-
Healthclub and spa
1,109,887
-
Golf
1,098,415
-
Other
201,627
-
8,120,392
-
The whole of the turnover is attributable to the group's principal activity wholly undertaken in the United Kingdom.
4
Operating profit
Period
Period
ended
ended
30 November
15 June
2023
2022
£
£
Operating profit for the period is stated after charging (crediting):
Depreciation of owned property, plant and equipment
403,447
-
Profit on disposal of property, plant and equipment
(10,996)
-
Amortisation of intangible assets
107,706
-
Operating lease charges
44,821
-
LQ SPA & GOLF RESORTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 NOVEMBER 2023
- 23 -
5
Auditor's remuneration
Period
Period
ended
ended
30 November
15 June
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the group and company
6,500
-
Audit of the financial statements of the company's subsidiaries
16,500
-
23,000
-
For other services
Taxation compliance services
1,500
-
All other non-audit services
10,000
-
11,500
-
6
Employees
The average monthly number of persons (including directors) employed by the group and company during the period was:
Group
Company
Period
Period
Period
Period
ended
ended
ended
ended
30 November
15 June
30 November
15 June
2023
2022
2023
2022
Number
Number
Number
Number
Service
113
-
-
-
Administration and support
15
-
-
-
Total
128
-
-
-
Their aggregate remuneration comprised:
Group
Company
Period
Period
Period
Period
ended
ended
ended
ended
30 November
15 June
30 November
15 June
2023
2022
2023
2022
£
£
£
£
Wages and salaries
3,657,225
-
-
-
Social security costs
259,630
-
-
-
Pension costs
38,455
3,880,311
-
-
-
LQ SPA & GOLF RESORTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 NOVEMBER 2023
6
Employees
(Continued)
- 24 -
Included in employee remuneration above is £126,922 (15 June 2022 - £nil) of employee costs recharged to the company from a related party hotel.
7
Directors' remuneration
Period
Period
ended
ended
30 November
15 June
2023
2022
£
£
Remuneration for qualifying services
54,672
-
Compensation for loss of office
74,999
-
129,671
-
The remuneration for the period ended 30 November 2023 is in respect of directors' salary recharged from a related party hotel.
8
Finance costs
Period
Period
ended
ended
30 November
15 June
2023
2022
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
568,040
-
Interest on finance leases and hire purchase contracts
10,519
-
Other interest
734
-
Total finance costs
579,293
9
Taxation
Period
Period
ended
ended
30 November
15 June
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
2,839
Adjustments in respect of prior periods
(8,608)
Total current tax
(5,769)
LQ SPA & GOLF RESORTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 NOVEMBER 2023
9
Taxation
(Continued)
- 25 -
Deferred tax
Origination and reversal of timing differences
53,823
Total tax charge
48,054
The actual charge for the period can be reconciled to the expected charge for the period based on the profit or loss and the standard rate of tax as follows:
Period
Period
ended
ended
30 November
15 June
2023
2022
£
£
Profit before taxation
34,714
-
Expected tax charge based on the standard rate of corporation tax in the UK of 21.75% (2022: 19.00%)
7,550
-
Tax effect of expenses that are not deductible in determining taxable profit
24,986
Unutilised tax losses carried forward
21,495
Adjustments in respect of prior years
(8,608)
Effect of change in corporation tax rate
2,208
-
Other permanent differences
18,088
Depreciation in excess of capital allowances
(71,488)
Deferred tax charge
53,823
Taxation charge
48,054
-
In addition to the amount charged to the income statement, the following amounts relating to tax have been recognised directly in other comprehensive income:
Period
Period
ended
ended
30 November
15 June
2023
2022
£
£
Deferred tax arising on:
Revaluation of property
4,258
-
LQ SPA & GOLF RESORTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 NOVEMBER 2023
- 26 -
10
Intangible fixed assets
Group
Goodwill
£
Cost
At 16 June 2022
Additions
737,572
At 30 November 2023
737,572
Amortisation and impairment
At 16 June 2022
Amortisation charged for the period
107,706
At 30 November 2023
107,706
Carrying amount
At 30 November 2023
629,866
At 15 June 2022
The company had no intangible fixed assets at 30 November 2023 or 15 June 2022.
11
Property, plant and equipment
Group
Freehold land and buildings
Plant and machinery
Fixtures and fittings
Health & spa equipment
Golf equipment
Total
£
£
£
£
£
£
Cost or valuation
At 16 June 2022
Additions
575,510
18,755
412,103
180,456
229,132
1,415,956
Acquistion of subsidiary
7,076,885
129,298
203,663
52,250
37,904
7,500,000
Disposals
18,020
18,020
Revaluation
(206,808)
74,380
(17,373)
38,813
19,479
(91,509)
At 30 November 2023
7,445,587
222,433
598,393
271,519
304,535
8,842,467
Depreciation and impairment
At 16 June 2022
Depreciation charged in the period
160,980
63,437
87,801
35,902
55,327
403,447
Revaluation
(160,980)
(160,980)
At 30 November 2023
63,437
87,801
35,902
55,327
242,467
Carrying amount
At 30 November 2023
7,445,587
158,996
510,592
235,617
249,208
8,600,000
LQ SPA & GOLF RESORTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 NOVEMBER 2023
11
Property, plant and equipment
(Continued)
- 27 -
The company had no property, plant and equipment at 30 November 2023 or 15 June 2022.
The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.
Group
Company
As at
As at
As at
As at
30 November
15 June
30 November
15 June
2023
2022
2023
2022
£
£
£
£
Plant and machinery
21,409
Golf equipment
213,697
Health & spa equipment
144,265
379,371
-
-
-
Property, plant and equipment with a carrying amount of £8,600,000 (15 June 2022 - £nil) have been pledged to secure borrowings of the group. Additional information is given in note 19.
The value of freehold land and buildings as at 30 November 2023 was determined based on a valuation performed on 18 September 2023 by Savills, independent valuers not connected to the company on the basis of market value. The valuation conforms to RICS Valuation - Global Standards and is based on an income approach having regard the property's trading potential.
Freehold land and buildings are carried at valuation. If the assets were measured using the cost model, the carrying amounts would be as follows:
As at
As at
30 November
15 June
2023
2022
£
£
Group
Cost
7,652,395
-
Accumulated depreciation
(160,980)
-
Carrying value
7,491,415
-
LQ SPA & GOLF RESORTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 NOVEMBER 2023
- 28 -
12
Fixed asset investments
Group
Company
As at
As at
As at
As at
30 November
15 June
30 November
15 June
2023
2022
2023
2022
Notes
£
£
£
£
Investments in subsidiaries
13
4,572,071
Movements in non-current investments
Company
Shares in subsidiaries
£
Cost or valuation
At 16 June 2022
-
Additions
4,572,071
At 30 November 2023
4,572,071
Carrying amount
At 30 November 2023
4,572,071
At 15 June 2022
-
13
Subsidiaries
Details of the company's subsidiaries at 30 November 2023 are as follows:
Name of undertaking
Registered office
Nature of business
Class of
% Held
shares held
Direct
Ufford Park Limited
See below
Running of a hotel
Ordinary
100.00
The registered office of the above subsidiary is Lion Quays Hotel & Spa, Weston Rhyn, Gobowen, Oswestry, Shropshire, SY11 3EN.
14
Financial instruments
Group
Company
As at
As at
As at
As at
30 November
15 June
30 November
15 June
2023
2022
2023
2022
£
£
£
£
Carrying amount of financial assets
Debt instruments measured at amortised cost
277,357
-
n/a
n/a
Carrying amount of financial liabilities
Measured at amortised cost
8,819,531
-
n/a
n/a
LQ SPA & GOLF RESORTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 NOVEMBER 2023
- 29 -
15
Inventories
Group
Company
As at
As at
As at
As at
30 November
15 June
30 November
15 June
2023
2022
2023
2022
£
£
£
£
Finished goods and goods for resale
60,694
The carrying amount of inventories includes £60,694 (15 June 2022 - £nil) pledged as security for liabilities. Additional information is given in note 19.
16
Trade and other receivables
Group
Company
As at
As at
As at
As at
30 November
15 June
30 November
15 June
2023
2022
2023
2022
Amounts falling due within one year:
£
£
£
£
Trade receivables
192,480
Amounts owed by group undertakings
-
-
2,505,512
-
Other receivables
84,877
-
Prepayments and accrued income
91,195
368,552
-
2,505,512
Deferred tax asset (note 21)
24,261
24,261
392,813
-
2,529,773
-
The carrying amount of trade and other receivable includes £392,813 (15 June 2022 - £nil) pledged as security for liabilities. Additional information is given in note 19.
17
Current liabilities
Group
Company
As at
As at
As at
As at
30 November
15 June
30 November
15 June
2023
2022
2023
2022
Notes
£
£
£
£
Bank loans
19
42,339
42,339
Obligations under finance leases
20
72,850
Other borrowings
19
2,783,181
2,783,181
Trade payables
395,151
Corporation tax payable
2,933
Other taxation and social security
148,560
-
-
-
Other payables
330,788
Accruals and deferred income
178,718
28,659
3,954,520
-
2,854,179
-
LQ SPA & GOLF RESORTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 NOVEMBER 2023
17
Current liabilities
(Continued)
- 30 -
Obligations under finance leases are secured on the assets concerned.
18
Non-current liabilities
Group
Company
As at
As at
As at
As at
30 November
15 June
30 November
15 June
2023
2022
2023
2022
Notes
£
£
£
£
Bank loans and overdrafts
19
4,773,644
4,773,644
Obligations under finance leases
20
242,860
5,016,504
-
4,773,644
-
Obligations under finance leases are secured on the assets concerned.
19
Borrowings
Group
Company
As at
As at
As at
As at
30 November
15 June
30 November
15 June
2023
2022
2023
2022
£
£
£
£
Bank loans
4,815,983
4,815,983
Loan from related party
1,288,893
1,288,893
Other loan
1,494,288
1,494,288
7,599,164
-
7,599,164
-
Payable within one year
2,825,520
2,825,520
Payable after one year
4,773,644
4,773,644
The bank loan is repayable in instalment and has a final repayment date of 16 June 2027. Interest is payable on the loan at 3.65% plus Bank of England base rate. The bank loan is secured by a fixed and floating charge over the assets of the group and a personal guarantee of £975,000 given by one of the directors.
The other loan and loans from related parties are interest free, unsecured and repayable on demand.
LQ SPA & GOLF RESORTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 NOVEMBER 2023
- 31 -
20
Finance lease obligations
Group
Company
As at
As at
As at
As at
30 November
15 June
30 November
15 June
2023
2022
2023
2022
£
£
£
£
Future minimum lease payments due under finance leases:
Within one year
72,850
In two to five years
242,860
315,710
-
-
-
Finance lease payments represent rentals payable by the company or group for certain items of plant and machinery. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is 5 years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.
21
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the group and company, and movements thereon:
Liabilities
Liabilities
Assets
Assets
As at
As at
As at
As at
30 November
15 June
30 November
15 June
2023
2022
2023
2022
Group
£
£
£
£
Accelerated capital allowances
159,584
-
-
-
Tax losses
-
-
24,261
-
Revaluations
534,773
-
-
-
694,357
-
24,261
-
Liabilities
Liabilities
Assets
Assets
2023
2022
2023
2022
Company
£
£
£
£
Tax losses
-
-
24,261
-
LQ SPA & GOLF RESORTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 NOVEMBER 2023
21
Deferred taxation
(Continued)
- 32 -
Group
Company
2023
2023
Movements in the period:
£
£
Asset at 16 June 2022
-
-
Charge/(credit) to profit or loss
53,823
(24,261)
Charge to other comprehensive income
4,258
-
Transfer on acquistion of subsidiary
612,015
-
Liability/(Asset) at 30 November 2023
670,096
(24,261)
Of the deferred tax liability set out above, an amount of £27,453 is expected to reverse within 12 months and relates to accelerated capital allowances.
22
Retirement benefit schemes
Period
Period
ended
ended
30 November
15 June
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
38,455
-
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.
The company operates a defined contribution pension scheme for its employees. Included in other creditors on the balance sheet are pensions commitments of £26,465 (15 June 2022 - £nil).
23
Share capital
As at
As at
As at
As at
30 November
15 June
30 November
15 June
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
100
100
100
100
24
Reserves
Revaluation reserve
Revaluation reserve relates to the unrealised profit on the remeasurement of freehold land and buildings at fair value together with annual deferred tax adjustments.
Retained earnings
Retained earnings represents cumulative profits or losses net of dividends paid and other adjustments.
LQ SPA & GOLF RESORTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 NOVEMBER 2023
- 33 -
25
Acquisition of a business
On 16 June 2022 the group acquired 100% of the issued capital of Ufford Park Limited.
Book Value
Adjustments
Fair Value
Net assets acquired
£
£
£
Property, plant and equipment
9,641,992
(2,141,992)
7,500,000
Inventories
47,163
-
47,163
Trade and other receivables
201,943
-
201,943
Borrowings
(3,164,416)
-
(3,164,416)
Obligations under finance leases
(15,249)
-
(15,249)
Trade and other payables
(892,216)
-
(892,216)
Tax liabilities
(151,834)
-
(151,834)
Deferred tax
(81,500)
(530,515)
(612,015)
Total identifiable net assets
5,585,883
(2,672,507)
2,913,376
Goodwill
737,572
Total consideration
3,650,948
The consideration was satisfied by:
£
Cash
3,650,948
Contribution by the acquired business for the reporting period included in the group statement of comprehensive income since acquisition:
£
Revenue
8,120,391
Profit after tax
624,921
26
Operating lease commitments
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:
Group
Company
As at
As at
As at
As at
30 November
15 June
30 November
15 June
2023
2022
2023
2022
£
£
£
£
Within one year
28,630
-
-
-
Between two and five years
38,290
-
-
-
66,920
-
-
-
LQ SPA & GOLF RESORTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 NOVEMBER 2023
- 34 -
27
Related party transactions
Transactions with related parties
During the period the group entered into the following transactions with related parties:
Cross charges to related entries
Cross charges from related entities
Period
Period
Period
Period
ended
ended
ended
ended
30 November
15 June
30 November
15 June
2023
2022
2023
2022
£
£
£
£
Group
Entities under common control
3,618
-
324,133
-
The following amounts were outstanding at the reporting end date:
As at
As at
30 November
15 June
Amounts due to related parties
2023
2022
£
£
Group
Entities under common control
1,288,893
-
Directors' loan account
1,494,288
-
Company
Directors' loan account
1,494,288
-
Entities under common control
1,288,893
-
The loans to and from related parties are interest free, unsecured and repayable on demand.
The following amounts were outstanding at the reporting end date:
As at
As at
30 November
15 June
Amounts due from related parties
2023
2022
Balance
Balance
£
£
Group
Entities under common control
84,887
-
Company
Subsidiary undertaking
2,505,512
-
The loans to and from related parties are interest free, unsecured and repayable on demand.
LQ SPA & GOLF RESORTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 NOVEMBER 2023
27
Related party transactions
(Continued)
- 35 -
Other information
One of the directors has given a personal guarantee in respect of the group's bank loan (see note 19).
28
Controlling party
The ultimate controlling parties are Dr A Bansal and Mrs S Bansal by virtue of their 100% ownership of the issued share capital of the company.
29
Cash generated from (absorbed by) group operations
Period
Period
ended
ended
30 November
15 June
2023
2022
£
£
Loss for the period after tax
(13,340)
-
Adjustments for:
Taxation charged
48,054
Finance costs
579,293
Profit on disposal of property, plant and equipment
(10,996)
-
Amortisation and impairment of intangible assets
107,706
-
Depreciation and impairment of property, plant and equipment
403,447
-
Movements in working capital:
Increase in inventories
(13,531)
-
Increase in trade and other receivables
(81,732)
-
Increase in trade and other payables
161,001
-
Cash generated from operations
1,179,902
-
LQ SPA & GOLF RESORTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 NOVEMBER 2023
- 36 -
30
Analysis of changes in net funds/(debt) - group
16 June 2022
Cash flows
Acquisition of subsidiary
New finance leases
Other non-cash movements
30 November 2023
£
£
£
£
£
£
Cash at bank and in hand
100
33,881
-
-
-
33,981
Borrowings excluding overdrafts
-
(7,564,227)
-
-
(34,937)
(7,599,164)
Obligations under finance leases
-
92,976
(15,249)
(382,918)
(10,519)
(315,710)
100
(7,437,370)
(15,249)
(382,918)
(45,456)
(7,880,893)
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