The members present their annual report and financial statements for the year ended 30 September 2024.
The principal activity of the limited liability partnership continued to be that of a care provider.
Zero Three Care Homes LLP (“The LLP”) provides high quality care and support services to adults across the South-East of the UK, including those with learning disabilities, autism and complex care needs. The LLP is committed to person-centred care that enables individuals to live independently with dignity and respect.
The LLP’s services include supported living and residential care homes. The Company is regulated by the Care Quality Commission (CQC) and all services are delivered in line with applicable statutory requirements and best practice standards.
Fair review of the business
The results for the year which are set out in the profit and loss account show turnover of £13,341,101 and an operating profit of £2,407,077. At 30 September 2024 the LLP had net assets attributable to members of £15,572,933. The directors consider the performance for the year and the financial position at the year-end to be satisfactory.
Key performance indicators
Given the nature of the business, the members are of the opinion that key performance indicators are important. The LLP uses a number of indicators to monitor and improve the position of the business. Indicators are reviewed and altered to meet changes both in the internal and external environments. Key Performance Indicators, other than the financial results which in the opinion of the members does not require further comment, include the hours of care provided. The members are satisfied with the position of these indicators at the end of the financial year and believe that the prospects for the LLP are positive.
The management of the business and the execution of the LLP’s strategy are subject to a number of risks. The adult social care sector continues to face challenges. Key risks identified include:
Workforce Recruitment and Retention:
The availability of qualified care staff remains constrained. The LLP has responded with improved recruitment practices and enhanced training. The LLP also believes that the political importance of the sector means that the government will ensure that providers retain access to a supply of labour from outside the UK, including post Brexit
Regulatory Risk:
As a regulated provider, compliance with CQC standards is essential. The LLP maintains robust quality governance to mitigate this.
Cost Pressures:
Rising wage and wider inflationary pressures present a financial risk. The LLP continues to pursue efficiencies and engage with commissioners on fair contract pricing.
Financial instruments
Objectives and policies
The LLP is exposed to the usual credit and cash flow risks associated with selling on credit and manages this through credit control procedures. The board constantly monitors the LLP’s trading results and revises projections as appropriate to ensure that the LLP can meet its future obligations as they fall due.
Price risk, credit risk, liquidity risk and cash flow risk
The LLP is exposed to the usual credit and cash flow risks associated with selling on credit and manages this through credit control procedures. Cash flow, performance and key indicator reporting are measured under agreed covenant means testing and reported at the end of each quarter period.
Members are permitted to make drawings in anticipation of profits which will allocated to them. The amount of such drawings is set at the beginning of each financial year, taking into account the anticipated cash needs of the LLP.
New members are required to subscribe a minimum level of capital and in subsequent years, members are invited to subscribe for further capital, the amount of which is determined by the performance and seniority of those members. On retirement, capital is repaid to members.
The designated members who held office during the year and up to the date of signature of the financial statements were as follows:
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 limited liability partnership's continues and that the appropriate training is arranged. It is the policy of the limited liability partnership that the training, career development and promotion of disabled persons should, as far as possible, be identical to that of other employees.
The limited liability partnership's policy is to consult and discuss with employees, through unions, staff councils and at meetings, matters likely to affect employees' interests.
Information of 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 limited liability partnership's performance.
There is no employee share scheme at present, but the members are considering the introduction of such a scheme as a means of further encouraging the involvement of employees in the limited liability partnership's performance.
In accordance with the Limited Liability Partnerships (Energy and Carbon Report) Regulations 2018, Zero Three Care Homes LLP has prepared the following energy and carbon declaration.
Zero Three Care Homes LLP has followed the 2019 HM Government Environmental Reporting Guidelines. The LLP has also used the GHG Reporting Protocol – Corporate Standard and have used the 2020 UK Government’s Conversion Factors for Company Reporting
The annual reporting period below relates to the year to 30 September 2024.
Where we have not included any data for the previous period these amounts are unquantified as the data was not available at that time.
In accordance with the 2018 Regulations, the energy use and associated greenhouse gas emissions are for those assets owned or operated within UK only. This includes 10 care homes and 1 head office.
We have followed the 2019 HM Government Environmental Reporting Guidelines. We have also used the GHG Reporting Protocol – Corporate Standard and have used the 2020 UK Government’s Conversion Factors for LLP Reporting.
The chosen intensity measurement ratio is total gross emissions in metric tonnes CO2e per £million, the recommended ratio for the sector.
The LLP has implemented the policies below for the purpose of increasing the businesses energy efficiency in the
current reported financial period:
• Improved video conferencing availability and encouragement of its use;
• Reduced emissions & travel costs by reducing non-essential face to face meetings with customers & suppliers.
Our goal is to actively start implementing projects to improve our energy and carbon efficiency. For the current year, we have collated the data, noted above, and will now look to develop ways to improve energy efficiency by continuing to research methods to increase our carbon efficiency.
This report has been approved by the designated members of the LLP.
The members are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.
Company law (as applied by The Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008) requires the members to prepare financial statements for each financial year. Under that law the members have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice. Under company law (as applied by The Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008) the members 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 limited liability partnership and of the profit or loss of the limited liability partnership for that period. In preparing these financial statements, the members 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 limited liability partnership will continue in business.
The members are responsible for keeping adequate accounting records that are sufficient to show and explain the limited liability partnership’s transactions and disclose with reasonable accuracy at any time the financial position of the limited liability partnership and enable them to ensure that the financial statements comply with the Companies Act 2006 (as applied by The Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008). They are also responsible for safeguarding the assets of the limited liability partnership and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
We have audited the financial statements of Zero Three Care Homes LLP (the 'limited liability partnership') for the year ended 30 September 2024 which comprise the statement of comprehensive income, the statement of financial position, the reconciliation of members' interests and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
Basis for opinion
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the members' 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 limited liability partnership’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 members with respect to going concern are described in the relevant sections of this report.
Other information
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
There are inherent limitations in our audit procedures described below. The more removed that laws and regulations
are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing
standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of
directors and other management and the inspection of regulatory and legal correspondence, if any.
Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may
involve deliberate concealment or collusion.
Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:
The engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;
We identified the laws and regulations applicable to the company through discussions with directors and other management, and from our commercial knowledge and experience of the care sector;
We focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the company, including the Companies Act 2006, taxation legislation, data protection, anti-bribery, environmental and health and safety legislation;
We assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal correspondence; and
Identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit.
We assessed the susceptibility of the company’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:
Making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; and
Considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations.
In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:
Agreeing financial statement disclosures to underlying supporting documentation;
Enquiring of management as to actual and potential litigation and claims; and
Reviewing correspondence with the company’s legal advisors
Reviewing correspondence with regulatory authorities (CQC)
A further description of our responsibilities is available on the Financial Reporting Council’s website at: 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 limited liability partnership's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006 as applied by the Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008. Our audit work has been undertaken so that we might state to the limited liability partnership'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 limited liability partnership and the limited liability partnership's members as a body, for our audit work, for this report, or for the opinions we have formed.
The income statement has been prepared on the basis that all operations are continuing operations.
Zero Three Care Homes LLP is a limited liability partnership incorporated in England and Wales. The registered office is Thameside House, Hurst Road, East Molesey, Surrey, United Kingdom, KT8 9AY.
The financial statements contains a comparative 18 month accounting period to the 30 September 2023.
These financial statements have been prepared in accordance with the Statement of Recommended Practice "Accounting by Limited Liability Partnerships" issued in December 2021, under the Limited Liability Partnership Act 2000.
The financial statements are prepared in sterling, which is the functional currency of the limited liability partnership. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention, modified to include the revaluation of freehold properties and to include investment properties and certain financial instruments at fair value. The principal accounting policies adopted are set out below.
This limited liability partnership 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 limited liability partnership, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The limited liability partnership has therefore taken advantage of exemptions from the following disclosure requirements:
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: Interest income/expense and net gains/losses for financial instruments not measured at fair value; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;
Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.
The financial statements of the limited liability partnership are consolidated in the financial statements of Zero Topco Limited. These consolidated financial statements are available from its registered office, Thameside House Hurst Road, East Molesey, Surrey, KT8 9AY.
The company is in a net current liability position of £929,446 at the balance sheet date, which includes £466,393 owing to connected companies,
At the balance sheet date, £6,811,803 is due too is corporate members, of which the directors have confirmed in writing will not be recalled until the companies are in a position to repay this and for at least 12 months from the date these financial statements are signed.
The members have considered the forecasted future operations of the company and that the ultimate parent undertaking has confirmed to provide continuing financial support to the company, and have concluded that the company will have adequate resources to continue in business for the foreseeable future, being at least 12 months from the date of approval of these financial statements. The directors continue to adopt the going concern basis of accounting in preparing these financial statements.
Turnover is recognised at the fair value of the consideration received for services provided in relation to residential care in the normal course of business, and is shown net of VAT and other sales-related taxes
Revenue from the sale of residential care services is recognised at the point at which those services have been provided to the customer, and invoices are raised in line with the terms of contracts with customers. Where payments are received from customers in advance of services provided, the amounts are recorded as deferred income and included as part of creditors due within one year.
Members' participation rights are the rights of a member against the LLP that arise under the members' agreement (for example, in respect of amounts subscribed or otherwise contributed remuneration and profits).
Members' participation rights in the earnings or assets of the LLP are analysed between those that are, from the LLP's perspective, either a financial liability or equity, in accordance with section 22 of FRS 102. A member's participation rights including amounts subscribed or otherwise contributed by members, for example members' capital, are classed as liabilities unless the LLP has an unconditional right to refuse payment to members, in which case they are classified as equity.
All amounts due to members that are classified as liabilities are presented within 'Loans and other debts due to members' and, where such an amount relates to current year profits, they are recognised within ‘Members' remuneration charged as an expense’ in arriving at the relevant year’s result. Undivided amounts that are classified as equity are shown within ‘Members' other interests’. Amounts recoverable from members are presented as debtors and shown as amounts due from members within members’ interests.
Where there exists an asset and liability component in respect of an individual member’s participation rights, they are presented on a gross basis unless the LLP has both a legally enforceable right to set off the recognised amounts, and it intends either to settle on a net basis or to settle and realise these amounts simultaneously, in which case they are presented net.
Once an unavoidable obligation has been created in favour of members through allocation of profits or other means, any undrawn profits remaining at the reporting date are shown as ‘Loans and other debts due to members’ to the extent they exceed debts due from a specific member.
With the exception of freehold property, Tangible fixed assets are initially measured at cost less accumulated depreciation and any impairment losses.
Freehold property is stated in the balance sheet at revalued amounts, being the fair value on the date of revaluation less any subsequent depreciation and impairment losses. Revaluations are performed every 4yrs such that the carrying amount does not differ materially from that with could be determined using fair values at the reporting end date. Valuations are made against open markets, last valued on 31 March 2021.
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:
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.
Revaluation gains and losses are recognised in other comprehensive income and accumulated in equity, except to the extent that a revaluation gain reverses a revaluation loss previously recognised in profit or loss or a revaluation loss exceeds the accumulated revaluation gains recognised in equity; such gains and loss are recognised in profit or loss.
At each reporting period end date, the limited liability partnership 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 limited liability partnership 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.
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.
The limited liability partnership 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 limited liability partnership's statement of financial position when the limited liability partnership becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset and the net amounts presented in the financial statements when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the limited liability partnership transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the limited liability partnership after deducting all of its liabilities.
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.
Financial liabilities are derecognised when the limited liability partnership’s obligations expire or are discharged or cancelled.
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 limited liability partnership is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
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.
In the application of the limited liability partnership’s accounting policies, the members 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.
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.
Tangible fixed assets are depreciated over their useful lives taking into account residual values, where appropriate. The actual lives of the assets and residual values are assessed annually and may vary depending on a number of factors. In re-assessing asset lives, factors such as technological innovation, product life cycles and maintenance are taken into account. Residual value assessments consider issues such as future market conditions, the remaining life of the asset and projected disposal values.
Freehold property and improvements are stated at cost, and revalued every 4 years against on an open market basis, by independent professional valuers. The level of uncertainty in the UK property market has increased the degree of judgment involved in the valuations.
The total turnover of the company has been derived from its principal activity wholly undertaken in the United Kingdom.
Non audit services relate to preparation of the financial statements for the this company and others in the group.
The average number of persons (excluding members) employed by the partnership during the year was:
Their aggregate remuneration comprised:
The carrying value of land and buildings includes the following in respect of assets held under finance leases:
During the prior year the Limited Liability Partnership entered into a sale and leaseback transaction, whereby freehold properties held transferred ownership to another party but continued to be held under finance leases.
No impairment was recognised prior to sale due to the subsequent revaluation post year end supporting the historical valuation recognised on these assets.
Consequently these financial assets are held within freehold property and will therefore be revalued every four years in line with the revaluation model chosen for this class of tangible assets.
The depreciation charge in respect of such assets amounted to £216,745 (2023: £208,192) for the year.
Property and improvements were valued at an open market basis on 31st March 2021 by Colliers International. No revaluation has taken place in the current year, the next revaluation planned in 2025, in line with the four year revaluation policy.
The following assets are carried at valuation. If the assets were measured using the cost model, the carrying amounts would be as follows:
At the statement of financial position date, Shawbrook Bank Limited held a fixed and floating charge dated 30 January 2024 over the property held by the company.
Finance lease liabilities are stated after deducting £165,978 of costs associated with the raising of this finance, which are being released to the profit and loss account over the term of the finance leases. The implicit interest rate on the finance lease liabilities is 3.76% at year end, with an adjustable rate between 2% and 5% linked to RPI. Finance lease liabilities are payable in monthly instalments over a 40 year term with a final repayment due in 2063 and are secured against the freehold properties to which they relate.
The limited liability partnership operates a defined contribution pension scheme for all qualifying employees.
The assets of the scheme are held separately from those of the limited liability partnership in an independently administered fund.
In the event of a winding up the amounts included in "Loans and other debts due to members" will rank equally with unsecured creditors.
At the reporting end date the limited liability partnership had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows: