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Registered number: 11140749










COVENT GARDEN HOTEL (FREEHOLD) LIMITED










ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 JANUARY 2025

 
COVENT GARDEN HOTEL (FREEHOLD) LIMITED
 
 
COMPANY INFORMATION


Directors
T J R Kemp 
C C Ring 
M T Soden 




Company secretary
M T Soden



Registered number
11140749



Registered office
18 Thurloe Place

London

SW7 2SP




Independent auditor
MHA
Statutory Auditor

6th Floor

2 London Wall Place

London

EC2Y 5AU





 
COVENT GARDEN HOTEL (FREEHOLD) LIMITED
 

CONTENTS



Page
Strategic report
1 - 2
Directors' report
3 - 4
Independent auditor's report
5 - 8
Statement of comprehensive income
9
Statement of financial position
10
Statement of changes in equity
11
Notes to the financial statements
12 - 23


 
COVENT GARDEN HOTEL (FREEHOLD) LIMITED
 
 
STRATEGIC REPORT
FOR THE YEAR ENDED 31 JANUARY 2025

Introduction
 
The directors have pleasure in presenting their report and the financial statements of the Company for the year ended 31 January 2025.

Business review
 
The company continues to hold the freehold interest in the Covent Garden Hotel. The hotel continues to be managed by Firmdale Hotels PLC, a fellow group company.

Principal risks and uncertainties
 
The principal financial risks faced by the company, and the company's objectives and policies in relation to those risks, are as follows:
Cash flow risk
The finance department closely manages the company's cash flow. Detailed cash flow forecasts are regularly prepared with the objective of alerting the directors to potential future risks. It is the company’s policy to ensure that forecast funding requirements can be met with available commited facilities.
Interest rate risk
The company’s interest rate policy has the twin objectives of minimising net interest expense whilst providing protection from material adverse movements in interest rates. The company has fixed its interest charge obligations through until February 2028. 
Currency risk
The company faces minimal currency risk as it operates wholly in the UK.

Financial key performance indicators
 
The company's hotel is managed by Firmdale Hotels Plc and recorded revenues of £2.2m (2024: £1.9m) during the financial period, and increase of 15%.
The accommodation operated at an average occupancy of 81.7% (2024: 78.0%), an average room rate of £606 (2024: £615) and revenue per available room (RevPAR) of £496 (2024: £479).

Page 1

 
COVENT GARDEN HOTEL (FREEHOLD) LIMITED
 

STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2025

Going Concern
 
The directors review the cashflows and liabilities of Firmdale Holdings Ltd and its subsidiaries (“the Group”) as a whole in making assessments of the Group’s ability to meet its liabilities as they fall due. Therefore, as part of their assessment of going concern, the directors of the company have considered the funding and liquidity position of the Group to determine the appropriateness of preparing the financial statements on a going concern basis. 
The net current liabilities figure of £370m reported in the January 2024 Group Financial Statements was driven by three very substantial long term loans maturing in November 2024, a total of £386m. In London the maturing debt of £236m was successfully refinanced with Lloyds and HSBC banks, both facilities for a term of five years. The New York US$200m maturing debt, the equivalent of £150m, was rolled over by exercising the second of three options to extend for a further twelve months. The third option remains available for us to exercise in November 2025, but in the interim we are undertaking a review of the lending market with local debt advisory professionals to see if available terms for an early full refinance are attractive.
Trading for the first quarter of the 2025/26 financial year has exceeded budget in both London and New York. Forward booking are strong, and prospects for delivering on budget for the remainder of the financial year remain good. 
In light of the positive trading and cash generation projections, continuing delivery of financial covenant requirements and supportive banks, the Board has a high degree of confidence that the company will be able to meet its liabilities as they fall due and meet its covenant obligations for a period of at least twelve months. The Directors have therefore concluded that the company can continue to adopt the going concern basis in preparing the annual report and accounts. The Board will continue to monitor developments closely and adjust their forecasting assumptions as required. 
After generating a loss before tax of £705,580 (2024: £13,839,392) in the year, the company has net current liabilities of £12,320 thousand (2024: £10,739 thousand) at 31 January 2025. However, this is largely driven by an intercompany balance owed of £12,743 thousand (2024: £10,702 thousand). This balance won't be recalled to the detriment of other creditors and generally the hotel is trading well. The directors are satisfied this company remains a going concern. 


This report was approved by the board and signed on its behalf.



T J R Kemp
Director

Date: 17 July 2025

Page 2

 
COVENT GARDEN HOTEL (FREEHOLD) LIMITED
 
 
 
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 JANUARY 2025

The directors present their report and the financial statements for the year ended 31 January 2025.

Directors' responsibilities statement

The directors are responsible for preparing the Strategic report, the Directors' 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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. 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 for the Company's financial statements and then apply them consistently;

make judgments 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 to enable them to ensure that the financial statements comply with the Companies Act 2006They 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.

Principal activity

The principal activity of the company in the year is to hold the freehold interest of the Covent Garden Hotel.

Results and dividends

The loss for the year, after taxation, amounted to £705,580 (2024 - loss £13,839,392).

During the year, the directors did not propose any dividend.

Directors

The directors who served during the year were:

T J R Kemp 
C C Ring 
M T Soden 

Qualifying third party indemnity provisions

Third party qualifying directors' and officers’ insurance has been maintained throughout the financial year and to the date of this report which extends to all subsidiaries within the wider group under Firmdale Holdings Limited.

Page 3

 
COVENT GARDEN HOTEL (FREEHOLD) LIMITED
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2025

Disclosure of information to auditor

Each of the persons who are directors at the time when this Directors' report is approved has confirmed that:
 
so far as the director is aware, there is no relevant audit information of which the Company's auditor is unaware, and

the director has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the Company's auditor is aware of that information.

Post balance sheet events

There have been no significant events affecting the Company since the year end.

Auditor

The auditor, MHA, previously traded through the legal entity MacIntyre Hudson LLP. In response to regulatory changes, MacIntyre Hudson LLP ceased to hold an audit registration with the engagement transitioning to MHA Audit Services LLP. MHA will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

This report was approved by the board and signed on its behalf.
 





T J R Kemp
Director

Date: 17 July 2025

Page 4

 
COVENT GARDEN HOTEL (FREEHOLD) LIMITED
 
 
 
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF COVENT GARDEN HOTEL (FREEHOLD) LIMITED
 

Opinion


We have audited the financial statements of Covent Garden Hotel (Freehold) Limited (the 'Company') for the year ended 31 January 2025, which comprise the Statement of comprehensive income, the Statement of financial position, the Statement of changes in equity and the related notes, including a summary of significant accounting policiesThe 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 January 2025 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.


Basis for opinion


We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the Company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council'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.


Page 5

 
COVENT GARDEN HOTEL (FREEHOLD) LIMITED
 
 
 
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF COVENT GARDEN HOTEL (FREEHOLD) LIMITED (CONTINUED)


Other information


The other information comprises the information included in the Annual Report other than the financial statements and our Auditor's report thereon. The directors are responsible for the other information contained within the Annual ReportOur 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.


Opinion on other matters prescribed by the Companies Act 2006
 

In our opinion, based on the work undertaken in the course of the 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.


Matters on which we are required to report by exception
 

In the light of the knowledge and understanding of the Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic report or the Directors' report.


We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:


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.


Responsibilities of directors
 

As explained more fully in the Directors' responsibilities statement set out on page 3, 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.


Page 6

 
COVENT GARDEN HOTEL (FREEHOLD) LIMITED
 
 
 
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF COVENT GARDEN HOTEL (FREEHOLD) LIMITED (CONTINUED)


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:
enquiry of management, those charged with governance and Company legal advisors around actual and
potential litigation and claims;
performing audit work over the risk and management override of controls, including testing of journal entries
and other adjustments for appropriateness, evaluating the business rationale of significant transactions
outside the normal course of business and reviewing accounting estimates for bias;
reviewing minutes of meetings of those charged with governance; and
reviewing financial statement disclosures and testing to supporting documentation to assess compliance
with applicable laws and regulations.


Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.


A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditor's report.


Page 7

 
COVENT GARDEN HOTEL (FREEHOLD) LIMITED
 
 
 
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF COVENT GARDEN HOTEL (FREEHOLD) LIMITED (CONTINUED)


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 2006Our 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.





Rajeev Shaunak BSc FCA (Senior Statutory Auditor)
 
for and on behalf of
MHA
Statutory Auditor
 
London, United Kingdom

 
Date: 
17 July 2025
MHA is the trading name of MHA Audit Services LLP, a limited liability partnership in England and Wales (registered number OC455542).
Page 8

 
COVENT GARDEN HOTEL (FREEHOLD) LIMITED
 
 
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 JANUARY 2025

2025
2024
£
£

  

Turnover
 4 
2,159,896
1,874,256

Administrative expenses
  
(18,316)
(28,195)

Fair value movements
  
103,019
(12,136,632)

Operating profit/(loss)
  
2,244,599
(10,290,571)

Interest receivable and similar income
 7 
2,282
-

Interest payable and similar expenses
 8 
(2,952,461)
(3,548,821)

Loss before tax
  
(705,580)
(13,839,392)

Loss for the financial year
  
(705,580)
(13,839,392)

There were no recognised gains and losses for 2025 or 2024 other than those included in the statement of comprehensive income.

There was no other comprehensive income for 2025 (2024:£NIL).

The notes on pages 12 to 23 form part of these financial statements.

Page 9

 
COVENT GARDEN HOTEL (FREEHOLD) LIMITED
REGISTERED NUMBER: 11140749

STATEMENT OF FINANCIAL POSITION
AS AT 31 JANUARY 2025

2025
2024
Note
£
£

Fixed assets
  

Investments
 10 
100
100

Investment property
 11 
45,500,000
45,500,000

Current assets
  

Debtors: amounts falling due within one year
 12 
1,892,032
1,782,826

Cash at bank and in hand
 13 
29,851
53,941

  
1,921,883
1,836,767

Creditors: amounts falling due within one year
 14 
(14,241,928)
(12,576,232)

Net current liabilities
  
 
 
(12,320,045)
 
 
(10,739,465)

Total assets less current liabilities
  
33,180,055
34,760,635

Creditors: amounts falling due after more than one year
 15 
(47,775,000)
(48,650,000)

  

Net liabilities
  
(14,594,945)
(13,889,365)


Capital and reserves
  

Called up share capital 
  
100
100

Profit and loss account
 17 
(14,595,045)
(13,889,465)

  
(14,594,945)
(13,889,365)


The financial statements were approved and authorised for issue by the board and were signed on its behalf by: 




T J R Kemp
Director

Date: 17 July 2025

The notes on pages 12 to 23 form part of these financial statements.

Page 10

 
COVENT GARDEN HOTEL (FREEHOLD) LIMITED
 

STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 JANUARY 2025


Called up share capital
Profit and loss account
Total equity

£
£
£


At 1 February 2023
100
(50,073)
(49,973)


Comprehensive income for the year

Loss for the year
-
(13,839,392)
(13,839,392)
Total comprehensive income for the year
-
(13,839,392)
(13,839,392)



At 1 February 2024
100
(13,889,465)
(13,889,365)


Comprehensive income for the year

Loss for the year
-
(705,580)
(705,580)
Total comprehensive income for the year
-
(705,580)
(705,580)


At 31 January 2025
100
(14,595,045)
(14,594,945)


The notes on pages 12 to 23 form part of these financial statements.

Page 11

 
COVENT GARDEN HOTEL (FREEHOLD) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2025

1.


General information

Covent Garden Hotel (Freehold) Limited is a private company, limited by shares, incorporated and registered in England and Wales under the Companies Act, registered number 11140749. The company's registered office is 18 Thurloe Place, London, SW7 2SP. The principal place of business is 10 Monmouth Street, London WC2H 9HB.
The principal activity of the company in the current period is to hold the freehold interest of the Covent Garden Hotel.
The Company's functional and presentational currency is pound sterling (GBP), rounded to the nearest £1.

2.Accounting policies

 
2.1

Basis of preparation of financial statements

The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with FRS 102 'The Financial Reporting Standard applicable in the UK and the Republic of Ireland' and the requirements of the Companies Act 2006. The disclosure requirements of Section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.

The following principal accounting policies have been applied:

 
2.2

Financial Reporting Standard 102 - reduced disclosure exemptions

The Company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by the FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":
the requirements of Section 7 Statement of Cash Flows;
the requirements of Section 3 Financial Statement Presentation paragraph 3.17(d);
the requirements of Section 11 Financial Instruments paragraphs 11.42, 11.44 to 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b) and 11.48(c);
the requirements of Section 12 Other Financial Instruments paragraphs 12.26 to 12.27, 12.29(a), 12.29(b) and 12.29A;
the requirements of Section 33 Related Party Disclosures paragraph 33.7.

This information is included in the consolidated financial statements of Firmdale Holdings Limited as at 31 January 2025 and these financial statements may be obtained from the Registrar of Companies.

 
2.3

Exemption from preparing consolidated financial statements

The Company is a parent company that is also a subsidiary included in the consolidated financial statements of a larger group by a parent undertaking established under the law of any part of the United Kingdom and is therefore exempt from the requirement to prepare consolidated financial statements under section 400 of the Companies Act 2006.

Page 12

 
COVENT GARDEN HOTEL (FREEHOLD) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2025

2.Accounting policies (continued)

 
2.4

Going concern

The directors review the cashflows and liabilities of Firmdale Holdings Ltd and its subsidiaries (“the Group”) as a whole in making assessments of the Group’s ability to meet its liabilities as they fall due. Therefore, as part of their assessment of going concern, the directors of the company have considered the funding and liquidity position of the Group to determine the appropriateness of preparing the financial statements on a going concern basis. 
The net current liabilities figure of £370m reported in the January 2024 Group Financial Statements was driven by three very substantial long term loans maturing in November 2024, a total of £386m. In London the maturing debt of £236m was successfully refinanced with Lloyds and HSBC banks, both facilities for a term of five years. The New York US$200m maturing debt, the equivalent of £150m, was rolled over by exercising the second of three options to extend for a further twelve months. The third option remains available for us to exercise in November 2025, but in the interim we are undertaking a review of the lending market with local debt advisory professionals to see if available terms for an early full refinance are attractive.
Trading for the first quarter of the 2025/26 financial year has exceeded budget in both London and New York. Forward booking are strong, and prospects for delivering on budget for the remainder of the financial year remain good. 
In light of the positive trading and cash generation projections, continuing delivery of financial covenant requirements and supportive banks, the Board has a high degree of confidence that the company will be able to meet its liabilities as they fall due and meet its covenant obligations for a period of at least twelve months. The Directors have therefore concluded that the company can continue to adopt the going concern basis in preparing the annual report and accounts. The Board will continue to monitor developments closely and adjust their forecasting assumptions as required. 
The net current liabilities of £12,320 thousand (2024: £10,739 thousand) at January 2025 are driven by amounts owed to Group undertakings of £12,743 thousand (2024: £10,702 thousand). These amounts arose from Group support when acquiring the freehold of Covent Garden Hotel and will not be recalled to the detriment of other creditors. 

 
2.5

Revenue

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised:

Rendering of services

Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:
the amount of revenue can be measured reliably;
it is probable that the Company will receive the consideration due under the contract;
the stage of completion of the contract at the end of the reporting period can be measured reliably; and
the costs incurred and the costs to complete the contract can be measured reliably.

Page 13

 
COVENT GARDEN HOTEL (FREEHOLD) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2025

2.Accounting policies (continued)

 
2.6

Operating leases: the Company as lessor

Rental income from operating leases is credited to profit or loss on a straight-line basis over the lease term.

Amounts paid and payable as an incentive to sign an operating lease are recognised as a reduction to income over the lease term on a straight-line basis, unless another systematic basis is representative of the time pattern over which the lessor's benefit from the leased asset is diminished.

 
2.7

Interest income

Interest income is recognised in profit or loss using the effective interest method.

 
2.8

Finance costs

Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.

 
2.9

Borrowing costs

All borrowing costs are recognised in profit or loss in the year in which they are incurred.

 
2.10

Investment property

Investment property is carried at fair value determined annually by external valuers and derived from the current market rents and investment property yields for comparable real estate, adjusted if necessary for any difference in the nature, location or condition of the specific asset. No depreciation is provided. Changes in fair value are recognised in profit or loss.

 
2.11

Valuation of investments

Investments in subsidiaries are measured at cost less accumulated impairment.

Investments in listed company shares are remeasured to market value at each reporting date. Gains and losses on remeasurement are recognised in profit or loss for the period.

 
2.12

Debtors

Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.

 
2.13

Cash and cash equivalents

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.

Page 14

 
COVENT GARDEN HOTEL (FREEHOLD) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2025

2.Accounting policies (continued)

 
2.14

Creditors

Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.

 
2.15

Financial instruments

The Company has elected to apply the provisions of Section 11 “Basic Financial Instruments” of FRS 102 to all of its financial instruments.

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

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

Basic financial assets

Basic financial assets, which include trade and other debtors, cash and bank balances, are initially measured at their transaction price (adjusted for transaction costs except in the initial measurement of financial assets that are subsequently measured at fair value through profit and loss) and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, 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.

Discounting is omitted where the effect of discounting is immaterial. The Company's cash and cash equivalents, trade and most other debtors due with the operating cycle fall into this category of financial instruments.

Other financial assets

Other financial assets, which includes investments in equity instruments which are not classified as subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the recognised transaction price. Such assets are subsequently measured at fair value with the changes in fair value being recognised in the profit or loss. Where other financial assets are not publicly traded, hence their fair value cannot be measured reliably, they are measured at cost less impairment.

Impairment of financial assets

At the end of each reporting period financial assets measured at amortised cost are assessed for objective evidence of impairment. 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. 

Financial assets are impaired when events, subsequent to their initial recognition, indicate the estimated future cash flows derived from the financial asset(s) have been adversely impacted. The impairment loss will be the difference between the current carrying amount and the present value of the future cash flows at the asset(s) original effective interest rate.

If there is a favourable change in relation to the events surrounding the impairment loss then the
Page 15

 
COVENT GARDEN HOTEL (FREEHOLD) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2025

2.Accounting policies (continued)


2.15
Financial instruments (continued)

impairment can be reviewed for possible reversal. The reversal will not cause the current carrying amount to exceed the original carrying amount had the impairment not been recognised. The impairment reversal is recognised in the profit or loss.

Basic 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 the deduction of all its liabilities.

Basic financial liabilities, which include trade and other creditors, bank loans and other loans are initially measured at their transaction price (adjusting for transaction costs except in the initial measurement of financial liabilities that are subsequently measured at fair value through profit and loss). When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future payments discounted at a market rate of interest, discounting is omitted where the effect of discounting is immaterial.

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

Trade creditors are obligations to pay for goods and services that have been acquired in the ordinary course of business from suppliers. Trade creditors are classified as current liabilities if the payment is due within one year. If not, they represent non-current liabilities. Trade creditors are initially recognised at their transaction price and subsequently are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial.

Derecognition of financial instruments

Derecognition of financial assets

Financial assets are derecognised when their contractual right to future cash flow expire, or are settled, or when the Company transfers the asset and substantially all the risks and rewards of ownership to another party. If significant risks and rewards of ownership are retained after the transfer to another party, then the Company will continue to recognise the value of the portion of the risks and rewards retained.

Derecognition of financial liabilities

Financial liabilities are derecognised when the Company's contractual obligations expire or are discharged or cancelled.

Page 16

 
COVENT GARDEN HOTEL (FREEHOLD) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2025

3.


Judgments in applying accounting policies and key sources of estimation uncertainty

The following judgements (including the key areas of estimation uncertainty) have had the most significant effect on amounts recognised in the financial statements:
Fair value of investment property
Freehold investment property is held at fair value based on the directors' conclusions, having consulted and reviewed the previous valuations completed by independent valuation specialists. These valuers hold recognised and relevant professional qualifications. The valuations are based on estimated rental values in the surrounding area to the property which includes judgements relating to various market factors and conditions.


4.


Turnover

An analysis of turnover by class of business is as follows:


2025
2024
£
£

Rent receivable
99,615
91,530

Rent receivable - intercompany
2,060,281
1,782,726

2,159,896
1,874,256


Analysis of turnover by country of destination:

2025
2024
£
£

United Kingdom
2,159,896
1,874,256

2,159,896
1,874,256



5.


Auditor's remuneration

During the year, the Company obtained the following services from the Company's auditor:


2025
2024
£
£

Fees payable to the Company's auditor for the audit of the Company's financial statements
15,990
15,145

Page 17

 
COVENT GARDEN HOTEL (FREEHOLD) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2025

6.


Employees

There were no staff costs incurred during the year or the previous period.





The average monthly number of employees, including directors, during the year was 3 (2024 - 1).


7.


Interest receivable

2025
2024
£
£


Bank interest receivable
2,282
-

2,282
-


8.


Interest payable and similar expenses

2025
2024
£
£


Bank interest payable
2,952,461
3,548,821

2,952,461
3,548,821

Page 18

 
COVENT GARDEN HOTEL (FREEHOLD) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2025

9.


Taxation


2025
2024
£
£



Total current tax
-
-

Deferred tax

Total deferred tax
-
-


Tax on loss
-
-

Factors affecting tax charge for the year

The tax assessed for the year is lower than (2024 - lower than) the standard rate of corporation tax in the UK of 25% (2024 - 23.83%). The differences are explained below:

2025
2024
£
£


Loss on ordinary activities before tax
(705,580)
(13,839,392)


Loss on ordinary activities multiplied by standard rate of corporation tax in the UK of 25% (2024 - 23.83%)
(176,395)
(3,297,927)

Effects of:


Income not taxable for tax purposes
(15,781)
-

Movement in deferred tax not recognised
11,876
-

Unrelieved tax losses carried forward
-
3,297,927

Group relief
180,300
-

Total tax charge for the year
-
-


Factors that may affect future tax charges

There were no factors that may affect future tax charges.



Page 19

 
COVENT GARDEN HOTEL (FREEHOLD) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2025

10.


Fixed asset investments





Investments in subsidiary companies

£



Cost or valuation


At 1 February 2024
100



At 31 January 2025
100





Subsidiary undertaking


The following was a subsidiary undertaking of the Company:

Name

Registered office

Class of shares

Holding

Covent Garden Hotel (Leasehold) Limited
18 Thurloe Place, London, SW7 2SP
Ordinary
100%

The aggregate of the share capital and reserves as at 31 January 2025 and the profit or loss for the year ended on that date for the subsidiary undertaking were as follows:

Name
Aggregate of share capital and reserves
Profit/(Loss)

Covent Garden Hotel (Leasehold) Limited
2,272,412
(1,092,719)

Page 20

 
COVENT GARDEN HOTEL (FREEHOLD) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2025

11.


Investment property


Freehold investment property

£



Valuation


At 1 February 2024
45,500,000


Disposals
(103,019)


Surplus on revaluation
103,019



At 31 January 2025
45,500,000

On 28 February 2023, Covent Garden Hotel (Freehold) Limited purchased the freehold of the property known as The Covent Garden Hotel, 10 Monmouth Street, London WC2H 9HB, at market value. Another group entity held the leasehold which was assigned to Covent Garden Hotel (Leasehold) Limited, a subsidiary of Covent Garden Hotel (Freehold) Limited. 
The valuation for Covent Garden Hotel (Freehold) Limited is based on a detailed valuation report completed by Cushman & Wakefield, Chartered Surveyors, an independent valuer with a recognised and relevant professional qualification and with recent experience in the location and category of the property being valued. The value is reflective of the freehold value subject to lease at the reporting date. 




2025
2024
£
£


Historic cost
39,694,884
39,694,884

39,694,884
39,694,884


12.


Debtors

2025
2024
£
£


Amounts owed by group undertakings
1,892,032
1,782,826

1,892,032
1,782,826


Amounts owed by group undertakings are unsecured, interest free and repayable on demand.

Page 21

 
COVENT GARDEN HOTEL (FREEHOLD) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2025

13.


Cash and cash equivalents

2025
2024
£
£

Cash at bank and in hand
29,851
53,941



14.


Creditors: Amounts falling due within one year

2025
2024
£
£

Bank loans
875,000
850,000

Amounts owed to group undertakings
12,742,524
10,702,262

Other taxation and social security
38,870
4,975

Accruals and deferred income
585,534
1,018,995

14,241,928
12,576,232


Amounts owed to group undertakings are unsecured, interest-free, have no fixed date of repayment and are payable on demand.


15.


Creditors: Amounts falling due after more than one year

2025
2024
£
£

Bank loans
47,775,000
48,650,000


Page 22

 
COVENT GARDEN HOTEL (FREEHOLD) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2025

16.


Loans


Analysis of the maturity of loans is given below:


2025
2024
£
£

Amounts falling due within one year

Bank loans
875,000
850,000

Amounts falling due 1-2 years

Bank loans
975,000
875,000

Amounts falling due 2-5 years

Bank loans
46,800,000
47,775,000

48,650,000
49,500,000


The above balance relates to two bank loans with Coutts & Co. Facility A is for £34.5m and accrues interest at 6.551% per annum, fixed for the term. It is repayable in instalments ending 27 February 2028.
Facility B is for £15m and accrues interest at a variable rate based on SONIA plus 2.5% margin. It is repayable in full on 27 February 2028.
Bank loans are secured by fixed and floating charges over the assets of the company.


17.


Reserves

Profit and loss account

Profit and loss account represents cumulative profits or losses, net of dividends paid and other adjustments.


18.


Related party transactions

The company has taken advantage of the exemption available under paragraph 33.1A of the Financial  Reporting Standard 102 not to disclose transactions with other wholly owned members of the group.


19.


Controlling party

The immediate parent and controlling company is Firmdale Holdings Limited, a company registered in England and Wales.
The company is included within the consolidation of the Firmdale Holdings Limited group and this is the parent of the smallest and largest group which draws up consolidated financial statements. Firmdale Holdings Limited registered office address is 18 Thurloe Place, London, SW7 2SP. The consolidated accounts of this group are publicly available from the Registrar of Companies.
 
Page 23