Company registration number 09587881 (England and Wales)
DANISH BAKE UK LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
DANISH BAKE UK LIMITED
COMPANY INFORMATION
Directors
Mr J Knudsen
(Appointed 1 January 2024)
Mr K Wienecke
(Appointed 10 January 2024)
Mr G Hollinshead
(Appointed 1 March 2025)
Secretary
Canute Secretaries Ltd
Company number
09587881
Registered office
5th Floor
27 Greville Street
London
EC1N 8SU
Auditor
Thomson Cooper
3 Castle Court
Carnegie Campus
Dunfermline
Fife
KY11 8PB
DANISH BAKE UK LIMITED
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3 - 4
Independent auditor's report
5 - 7
Profit and loss account
8
Statement of comprehensive income
9
Balance sheet
10
Statement of changes in equity
11
Notes to the financial statements
12 - 22
DANISH BAKE UK LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
- 1 -
The directors present the strategic report for the year ended 31 December 2024.
Principal activities
The principal activity of the company is the production and sale of baked goods in retail stores around London.
Review of the business
2024
2023
Change
£
£
%
Turnover
36,684,837
34,820,879
5
EBITDA
4,890,689
3,926,824
25
Average number of employees
279
221
25
2024 was a year of strong and focused execution for Ole & Steen as we delivered organic top-line sales growth of 5%, reaching £36.7 million across our 26 London stores. In addition, our EBITDA increased by £964k to £4.9 million, a 25% year-on-year uplift. This performance was driven by a stellar finish to the year, with Q4 delivering +17% like-for-like sales growth, firmly re-establishing our position as London’s favourite Danish bakery and coffeehouse. This positive momentum has continued into 2025.
As expected, raw material prices decreased after the 2022 and 2023 highs as general food inflation flattened out, however, during the year, unexpected price increases within coffee, cacao and dairy eroded some of the improvements from earlier in the year. This negative impact is expected to carry into 2025, though we continue cooperating with our key suppliers and the supply chain team to mitigate this.
The foundation for our success was the Group Refocused Strategy launched in April 2024. This strategy has reaffirmed our identity as The Danish Bakery and Coffee House in London. We’ve invested heavily in our stores, teams, service standards, and digital capability. From extended opening hours to seasonal product development, we’re meeting our customers where they are – in-store, online, and on special occasions like New Year, Halloween, and Valentine’s Day.
Our investment in the Leyton production facility is delivering the cost efficiencies and consistent high quality we expected. As we moved into autumn, we recorded some of our best trading weeks ever. October saw the launch of our highly successful “Treat of the Week” campaign, showcasing a different signature Danish pastry each week at a special price point. The response has been outstanding, and we’ll continue the offer throughout 2025.
Innovation remains at the heart of what we do. In 2024, we launched a series of standout products – from our award-winning Christmas Turkey Toastie to the beautifully crafted Cardamom bun. And who could forget the festive twist on our iconic Cinnamon Social, reimagined as a limited-edition Christmas Social with orange jam, custard, and chocolate icing?
Customer convenience is core to our brand experience. In 2024, we expanded to three major delivery platforms and introduced a new web-based ordering portal to better serve offices and B2B clients. Meanwhile, our Loyalty App membership grew by over 40%, with strong engagement across features like Click & Collect, loyalty rewards, and exclusive offers.
At the heart of our Refocus Strategy was a clear mission: to win our customers back. Thanks to the passion, hard work, and commitment of our incredible team we are doing exactly that.
DANISH BAKE UK LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 2 -
Principal risks and uncertainties
The company is exposed towards potential adverse effects from development in commodity prices and inflation.
Financial risk management
Our company's operations are not immune to financial risks. We are exposed to the potential adverse effects of changes in credit, liquidity, and interest rate risks. To counter these, we have a comprehensive risk management programme to mitigate these risks and safeguard our financial performance.
Credit risk
The credit risk associated with sales is low, and there are no significant disputes over debtor balances, as sales from the company's retail stores are either paid in cash or with credit cards.
Liquidity risk
Our company takes a proactive stance in maintaining a healthy financial position. We manage a balanced mix of long-term and short-term debt finance through a facility agreement and cash pool with the parent company Danish Bake A/S. This strategy ensures that we always have sufficient funds for our operations.
Interest rate risk
The company has both interest-bearing assets and interest-bearing liabilities. Interest-bearing assets include only cash balances that earn interest at a variable rate. Interest-bearing liabilities solely relate to loans with parent or other group undertakings. Rates stabilised during the year and declined marginally in 2024.
Mr G Hollinshead
Director
10 June 2025
DANISH BAKE UK LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
- 3 -
The directors present their annual report and financial statements for the year ended 31 December 2024.
Results and dividends
The loss for the year, after taxation, amounted to £881,158 (2023 - loss £1,544,794).
The analysis of the key performance indicators is detailed in the Strategic report on page 1.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
Mr J Knudsen
(Appointed 1 January 2024)
Mr K Wienecke
(Appointed 10 January 2024)
M Jensen
(Resigned 10 January 2024)
Mr J Dixen
(Resigned 1 January 2024)
Mr G Hollinshead
(Appointed 1 March 2025)
Disabled persons
Applications for employment by disabled persons are always fully considered, bearing in mind the aptitudes of the applicant concerned. In the event of members of staff becoming disabled, every effort is made to ensure that their employment within the company continues and that the appropriate training is arranged. It is the policy of the company that the training, career development and promotion of disabled persons should, as far as possible, be identical to that of other employees.
Employee involvement
The company's policy is to consult and discuss with employees, through unions, staff councils and at meetings, matters likely to affect employees' interests.
Information about matters of concern to employees is given through information bulletins and reports which seek to achieve a common awareness on the part of all employees of the financial and economic factors affecting the company's performance.
There is no employee share scheme at present, but the directors are considering the introduction of such a scheme as a means of further encouraging the involvement of employees in the company's performance.
Future developments
We expect the current stores to increase profitable turnover and exploit the economics of scale from the new production site in Leyton which opened in the first quarter of 2023.
Auditor
Thomson Cooper were appointed as auditor to the company 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.
DANISH BAKE UK LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 4 -
Statement of directors' responsibilities
The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Statement of disclosure to auditor
So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.
Going Concern
The directors expect that the company has adequate resources to continue in operational existence for a period not less than 12 months from the point of approving this annual report and financial statements. The company has received confirmation that the parent undertaking, Danish Bake A/S, will provide financial support to the company if required. In fulfilling their obligations as directors of the company, they have satisfied themselves that the parent company has the means and ability to provide financial support if so required.
In doing so the directors have held discussions with directors of the parent company, have reviewed and discussed cashflow forecasts prepared and have considered group banking facilities and related forecast financial covenant compliance to ensure no impediment to parental financial support.
In performing these procedures and satisfying themselves accordingly, the directors therefore continue to adopt the going concern basis in preparing the Annual report and financial statements.
Research and development activities
The company did not incur any research and development costs during the year.
Donations
The company did not make any political or charitable donations during the year.
On behalf of the board
Mr G Hollinshead
Director
10 June 2025
DANISH BAKE UK LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF DANISH BAKE UK LIMITED
- 5 -
Opinion
We have audited the financial statements of Danish Bake UK Limited (the 'company') for the year ended 31 December 2024 which comprise the profit and loss account, the statement of comprehensive income, the balance sheet, the statement of changes in equity and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
give a true and fair view of the state of the company's affairs as at 31 December 2024 and of its loss for the year 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 company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit:
the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
DANISH BAKE UK LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF DANISH BAKE UK LIMITED (CONTINUED)
- 6 -
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report and the directors' report. We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of directors' remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit; or
the directors were not entitled to prepare the financial statements in accordance with the small companies regime and take advantage of the small companies' exemption in preparing the directors' report.
Responsibilities of directors
As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
Extent to which the audit was considered capable of detecting irregularities, including fraud
We considered the opportunities and incentives that may exist within the organisation for fraud and identified the greatest potential for fraud in the following areas: existence and timing of recognition of income, misstatement of work in progress, posting of unusual journals along with complex transactions and manipulating the Company’s key performance indicators to meet targets. We discussed these risks with management, designed audit procedures to test the timing and existence of revenue, reviewed a sample of contracts focussing on cut off, tested a sample of journals to confirm they were appropriate, read minutes of Board meetings and reviewed areas of judgement for indicators of management bias to address these risks.
We reviewed 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 the officers and other management (as required by the auditing standards). Whilst the company is subject to many laws and regulations, we did not identify any others where the consequence of non-compliance alone could have a material effect on amounts or disclosures in the financial statements.
We reviewed the laws and regulations in areas that directly affect the financial statements including financial and taxation legislation and considered the 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 with relevant and significant laws and regulations, and as required by the auditing standards, our work in respect of these was limited to enquiry of the officers and management of the company.
DANISH BAKE UK LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF DANISH BAKE UK LIMITED (CONTINUED)
- 7 -
Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations.
These inherent limitations are particularly significant in the case of misstatement resulting from fraud as this may involve sophisticated schemes designed to avoid detection, including deliberate failure to record transactions, collusion or the provision of intentional misrepresentations.
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.
Sharon Collins (Senior Statutory Auditor)
For and on behalf of Thomson Cooper, Statutory Auditor
3 Castle Court
Carnegie Campus
Dunfermline
Fife
KY11 8PB
18 June 2025
DANISH BAKE UK LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2024
- 8 -
2024
2023
Notes
£
£
Turnover
3
36,684,837
34,820,879
Cost of sales
(9,283,436)
(9,146,209)
Gross profit
27,401,401
25,674,670
Administrative expenses
(30,641,333)
(31,254,465)
Other operating income
4,463,730
6,068,558
Operating profit
4
1,223,798
488,763
Interest receivable and similar income
7
8,279
3,104
Interest payable and similar expenses
8
(1,459,350)
(1,998,202)
Loss before taxation
(227,273)
(1,506,335)
Tax on loss
9
(653,885)
(38,459)
Loss for the financial year
(881,158)
(1,544,794)
DANISH BAKE UK LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2024
- 9 -
2024
2023
£
£
Loss for the year
(881,158)
(1,544,794)
Other comprehensive income
-
-
Total comprehensive income for the year
(881,158)
(1,544,794)
DANISH BAKE UK LIMITED
BALANCE SHEET
AS AT 31 DECEMBER 2024
31 December 2024
- 10 -
2024
2023
Notes
£
£
£
£
Fixed assets
Tangible assets
10
20,129,881
23,059,341
Current assets
Stocks
11
472,655
348,151
Debtors falling due after more than one year
12
870,095
1,114,528
Debtors falling due within one year
12
2,647,284
2,410,357
Cash at bank and in hand
1,801,998
1,622,022
5,792,032
5,495,058
Creditors: amounts falling due within one year
13
(26,322,800)
(28,229,723)
Net current liabilities
(20,530,768)
(22,734,665)
Total assets less current liabilities
(400,887)
324,676
Provisions for liabilities
Provisions
15
2,740,982
2,740,982
Deferred tax liability
16
593,899
438,304
(3,334,881)
(3,179,286)
Net liabilities
(3,735,768)
(2,854,610)
Capital and reserves
Called up share capital
18
20,000
20,000
Profit and loss reserves
(3,755,768)
(2,874,610)
Total equity
(3,735,768)
(2,854,610)
The financial statements were approved by the board of directors and authorised for issue on 10 June 2025 and are signed on its behalf by:
Mr K Wienecke
Director
Company registration number 09587881 (England and Wales)
DANISH BAKE UK LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2024
- 11 -
Share capital
Profit and loss reserves
Total
£
£
£
Balance at 1 January 2023
20,000
(1,329,816)
(1,309,816)
Year ended 31 December 2023:
Loss and total comprehensive income
-
(1,544,794)
(1,544,794)
Balance at 31 December 2023
20,000
(2,874,610)
(2,854,610)
Year ended 31 December 2024:
Loss and total comprehensive income
-
(881,158)
(881,158)
Balance at 31 December 2024
20,000
(3,755,768)
(3,735,768)
DANISH BAKE UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
- 12 -
1
Accounting policies
Company information
Danish Bake UK Limited is a private company limited by shares incorporated in England. The registered office is Fifth Floor, 27 Greville Street, London, EC1N 8SU.
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. The principal accounting policies adopted are set out below.
The company's ultimate parent undertaking, Cidron Garonne Limited is a company registered in Jersey. In these financial statements, the company is considered to be a qualifying entity (for the purposes of this FRS) and has applied the exemptions available under FRS 102 in respect of the following disclosures:
the requirement of Section 4 Statement of financial Position paragraph 4.12(a)(iv);
the requirements of Section 7 Statement of Cash Flows and relates notes;
the requirements of Section 3 Financial Statement Presentation paragraph 3.17(d);
the requirement of Section 11 Financial Instruments paragraphs 11.39 to 11.48A;
the requirements of Section 12 Other Financial Instruments paragraphs 12.26 to 12.29A;
the requirements of Section 26 Share-based Payment paragraphs 26.18(b), 26.19 to 26.21 and 26.23; and
the requirements of Section 33 Related Party Disclosures paragraph 33.7.
1.2
Going concern
The directors expectruet that the company has adequate resources to continue in operational existence for a period not less than 12 months from the point of approving this annual report and financial statements. The company has received confirmation that the parent undertaking, Danish Bake A/S, will provide financial support to the company if required. In fulfilling their obligations as directors of the company, they have satisfied themselves that the parent company has the means and ability to provide financial support if so required.
In doing so the directors have held discussions with directors of the parent company, have reviewed and discussed cashflow forecasts prepared and have considered group banking facilities and related forecast financial covenant compliance to ensure no impediment to parental financial support.
In performing these procedures and satisfying themselves accordingly, the directors therefore continue to adopt the going concern basis in preparing the Annual report and financial statements.
1.3
Turnover
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.
The company has entered into an agreement that provides for royalty income based on a percentage of sales, with certain minimum amounts and, in the event of a loss, a support is provided.
DANISH BAKE UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 13 -
1.4
Tangible fixed assets
Tangible fixed assets 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:
Leasehold land and buildings
10 years
Plant and equipment
5 - 15 years
Fixtures and fittings
3 - 5 years
Computers
3 - 5 years
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
1.5
Impairment of fixed assets
At each reporting period end date, the company reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
1.6
Stocks
Stocks 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 stocks to their present location and condition.
Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.
At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks 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.
DANISH BAKE UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 14 -
1.7
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.
1.8
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include 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.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
Basic financial liabilities
Basic financial liabilities, including 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.
1.9
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
1.10
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
DANISH BAKE UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 15 -
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax
Deferred tax 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 profit and loss account, 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.
1.11
Provisions
Provisions are recognised when the company has a legal or constructive present obligation as a result of a past event, it is probable that the company will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.
The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the reporting end date, taking into account the risks and uncertainties surrounding the obligation. Where the effect of the time value of money is material, the amount expected to be required to settle the obligation is recognised at present value. When a provision is measured at present value, the unwinding of the discount is recognised as a finance cost in profit or loss in the period in which it arises.
1.12
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 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.
1.13
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.14
Leases
Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.
DANISH BAKE UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 16 -
1.15
Foreign exchange
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.
2
Judgements and key sources of estimation uncertainty
The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported for assets and liabilities as at the statement of financial position date and the amounts reported for expenses during the year. However, the nature of estimation means that actual outcomes could differ from those estimates. In the course of preparing the company’s financial statements no judgements have been made in the process of applying the company’s accounting policies, other than in respect of those involving estimates as set out below. The directors consider that the following estimate and judgement is likely to have the most significant effect on the amounts recognised in the financial statements:
Dilapidation provision
Provisions are made for potential dilapidation costs in respect of leased premises. The provisions are based on independent calculations provided by RAB Retail Ltd who are specialists in their field. The recognition and measurement of these provisions require estimates to be made in respect of uncertain events and amounts, with the key sources of estimation uncertainty and the judgement that has the most significant effect on the amounts recognised being in relation to the amount and timing of future cash flows required to settle any restoration obligation, and to a lesser extent the discount rate applied to those estimated cash flows. Any difference between expectations and the actual future liability will be accounted for in the period when such determination is made. Details of dilapidation provisions recognised are set out in note 15.
3
Turnover and other revenue
2024
2023
£
£
Turnover analysed by class of business
Retail sale
36,284,027
34,685,878
Other operating income
400,810
135,001
36,684,837
34,820,879
2024
2023
£
£
Turnover analysed by geographical market
United Kingdom
36,684,837
34,820,879
2024
2023
£
£
Other revenue
Interest income
8,279
3,104
Royalty income
4,463,730
6,068,558
DANISH BAKE UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 17 -
4
Operating profit
2024
2023
Operating profit for the year is stated after charging:
£
£
Depreciation of owned tangible fixed assets
3,666,891
3,438,061
Operating lease charges
5,245,578
5,313,746
5
Auditor's remuneration
2024
2023
Fees payable to the company's auditor and associates:
£
£
For audit services
Auditor's remuneration for audit services
35,000
34,000
Auditor's remuneration for non audit services
17,296
70,710
52,296
104,710
For other services
Accounts preparation services
4,100
4,000
Other services relating to taxation
6,750
6,500
All other non-audit services
6,446
60,210
17,296
70,710
6
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2024
2023
Number
Number
Administration
54
62
Operations
225
159
Total
279
221
Their aggregate remuneration comprised:
2024
2023
£
£
Wages and salaries
10,695,750
11,026,245
Social security costs
787,782
667,165
Pension costs
255,967
228,997
11,739,499
11,922,407
DANISH BAKE UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 18 -
7
Interest receivable and similar income
2024
2023
£
£
Interest income
Interest on bank deposits
8,279
3,104
2024
2023
Investment income includes the following:
£
£
Interest on financial assets not measured at fair value through profit or loss
8,279
3,104
8
Interest payable and similar expenses
2024
2023
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
423,239
695,517
Interest payable to group undertakings
1,036,111
1,302,685
1,459,350
1,998,202
9
Taxation
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
636,224
Adjustments in respect of prior periods
(137,934)
(193,927)
Total current tax
498,290
(193,927)
Deferred tax
Origination and reversal of timing differences
155,595
232,386
Total tax charge
653,885
38,459
DANISH BAKE UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
9
Taxation
(Continued)
- 19 -
The actual charge for the year can be reconciled to the expected credit for the year based on the profit or loss and the standard rate of tax as follows:
2024
2023
£
£
Loss before taxation
(227,273)
(1,506,335)
Expected tax credit based on the standard rate of corporation tax in the UK of 25.00% (2023: 23.52%)
(56,818)
(354,290)
Tax effect of expenses that are not deductible in determining taxable profit
20,189
586,676
Adjustments in respect of prior years
(137,934)
(193,927)
Permanent capital allowances in excess of depreciation
672,853
Movement in deferred tax
155,595
Taxation charge for the year
653,885
38,459
10
Tangible fixed assets
Leasehold land and buildings
Plant and equipment
Fixtures and fittings
Computers
Total
£
£
£
£
£
Cost
At 1 January 2024
27,642,652
4,673,848
4,163,539
1,227,395
37,707,434
Additions
634,292
13,042
158,092
9,093
814,519
Disposals
(30,747)
(52,150)
(26,725)
(6,284)
(115,906)
At 31 December 2024
28,246,197
4,634,740
4,294,906
1,230,204
38,406,047
Depreciation and impairment
At 1 January 2024
10,496,554
814,031
2,555,160
782,348
14,648,093
Depreciation charged in the year
2,622,815
360,941
546,485
136,650
3,666,891
Eliminated in respect of disposals
(12,564)
(7,719)
(12,282)
(6,253)
(38,818)
At 31 December 2024
13,106,805
1,167,253
3,089,363
912,745
18,276,166
Carrying amount
At 31 December 2024
15,139,392
3,467,487
1,205,543
317,459
20,129,881
At 31 December 2023
17,146,098
3,859,817
1,608,379
445,047
23,059,341
11
Stocks
2024
2023
£
£
Raw materials and consumables
472,655
348,151
DANISH BAKE UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 20 -
12
Debtors
2024
2023
Amounts falling due within one year:
£
£
Trade debtors
113,188
45,578
Corporation tax recoverable
393,057
255,123
Other debtors
178,110
169,273
Prepayments and accrued income
1,962,929
1,940,383
2,647,284
2,410,357
2024
2023
Amounts falling due after more than one year:
£
£
Rent deposits
870,095
1,114,528
Total debtors
3,517,379
3,524,885
Terms for the amounts owed by group undertakings is 30 days.
13
Creditors: amounts falling due within one year
2024
2023
Notes
£
£
Bank loans and overdrafts
14
7,663,047
6,405,829
Trade creditors
2,491,970
3,119,825
Amounts owed to group undertakings
10,646,711
13,409,201
Corporation tax
636,224
Other taxation and social security
481,119
432,118
Accruals and deferred income
4,403,729
4,862,750
26,322,800
28,229,723
Terms for the loan between group companies are on arms length principle, with an interest of 7.69% (2023: 7.69%)
14
Loans and overdrafts
2024
2023
£
£
Bank overdrafts
7,663,047
6,405,829
Payable within one year
7,663,047
6,405,829
DANISH BAKE UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 21 -
15
Provisions for liabilities
2024
2023
£
£
Dilapidations provision
2,740,982
2,740,982
16
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:
Liabilities
Liabilities
2024
2023
Balances:
£
£
Accelerated capital allowances
908,460
828,326
Tax losses
(305,001)
(382,008)
Other timing difference
(9,560)
(8,014)
593,899
438,304
2024
Movements in the year:
£
Liability at 1 January 2024
438,304
Charge to profit or loss
155,595
Liability at 31 December 2024
593,899
The deferred tax liability set out above is expected to reverse within 36 months and relates to accelerated capital allowances that are expected to mature within the same period.
17
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
255,967
228,997
The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.
18
Share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1.00 each
20,000
20,000
20,000
20,000
DANISH BAKE UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
18
Share capital
(Continued)
- 22 -
Called up share capital
Share capital represents the nominal value of shares that have been issued.
Profit and loss
Profit and loss account includes all current year and prior year retained profits and losses.
19
Operating lease commitments
As lessee
At the reporting end date, the company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:
2024
2023
£
£
Within 1 year
5,637,495
5,629,162
Years 2-5
21,429,585
21,915,968
After 5 years
15,648,011
20,800,123
42,715,091
48,345,253
20
Ultimate controlling party
The company's immediate parent undertaking is Danish Bake A/S, which is incorporated and registered in Denmark. The ultimate parent undertaking and controlling party is Cidron Garonne Limited which is incorporated and registered in Jersey. The group consolidated financial statements can be found online at https://lagkagehuset.dk/arsrapport-og-nogletal.
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