Registration number:
Red Hotels Limited
for the Period from 1 January 2024 to 29 December 2024
Red Hotels Limited
(Registration number: 06547005)
Contents
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Company Information |
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Strategic Report |
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Directors' Report |
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Statement of Directors' Responsibilities |
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Independent Auditor's Report |
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Consolidated Profit and Loss Account |
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Consolidated Statement of Comprehensive Income |
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Consolidated Balance Sheet |
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Balance Sheet |
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Consolidated Statement of Changes in Equity |
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Statement of Changes in Equity |
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Consolidated Statement of Cash Flows |
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Statement of Cash Flows |
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Notes to the Financial Statements |
Red Hotels Limited
(Registration number: 06547005)
Company Information
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Directors |
R Whittington R J Waghorn E Stratton |
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Company secretary |
R J Waghorn |
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Registered office |
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Bankers |
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Auditors |
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Red Hotels Limited
(Registration number: 06547005)
Strategic Report for the period from 1 January 2024 to 29 December 2024
The directors present their strategic report for the period from 1 January 2024 to 29 December 2024.
Principal activity
The principal activity of the group is holding interest in hotel establishments
Fair review of the business
Turnover in the 52 weeks ended 29 December 2024 fell by 3.1% to £12.907m (2023: £13.318m). The fall in turnover was largely due to the closure of the Scarlet Hotel for an extended period at the start of the year to carry out both internal and external repairs but also reflected a small fall in occupancy at Bedruthan.
Occupancy across both hotels in this period averaged 69% (2023: 72%) and the ADR was £190.46 (2023: £197.64). The gross profit margin fell to 38.4% (2023: 40.9%) largely due to increased wages and salaries costs. Administrative expenses rose by 6.2% primarily due to a significant increase in hotel repairs and maintenance costs, particularly at the Scarlet Hotel, to £1,104,183 (2023: £606,115). This was partly offset by a fall in energy costs albeit not to levels seen prior to the pandemic and Russia’s invasion of Ukraine. This led to EBITDA in the period falling to £770,801 (2023: £1,463,748).
During the period the Scarlet Hotel was closed for six weeks to carry out repair work both internally and externally to the hotel. We also continued the refurbishment of more hotel bedrooms at Bedruthan with the aim of making the hotel more appealing to a wider group of potential guests and making it less reliant on particular segments of the market.
The group uses various key performance indicators to analyse the business on a monthly basis. The KPI's which the directors consider to be most important to understand operating trends over the reporting period are shown below:
Turnover £12,906,523 (2023: £13,317,696)
Occupancy 68.6% (2023: 72.0%)
Average Daily Rate (ADR) £190.46 (2023: £197.64)
EBITDA (Earnings before Interest, Tax and Depreciation) £770,801 (2023: £1,463,748)
The ethos of the group is underpinned by a passion for protecting the environment and business decisions are taken to ensure that the impact on the planet is at the forefront of the mind. The group also seeks to carefully balance delivering business growth and profit, investing in its people, and seeking to deliver sustainable growth in shareholder value.
Red Hotels Limited
(Registration number: 06547005)
Strategic Report for the period from 1 January 2024 to 29 December 2024
Principal risks and uncertainties
The board of directors undertake a regular review of the group and have identified that the principal risks facing the group relate to competition and the effects of the current economic climate.
We have worked hard over recent years to try to ensure that the Bedruthan hotel has become more of a year-round destination so as to smooth out the impact that seasonality has on the business although the summer months will still be key to the group's overall success. It is vital that both hotels maintain very high standards and continues to invest in their facilities in order that we can provide our guests with a memorable experience during their stay. The group seeks to mitigate this risk by ensuring that it provides an offer that is considered to be excellent value for money and significant effort and investment is made to create an environment that provides guests with a range of internal and external spaces that enable them to have a relaxing and enjoyable stay that will hopefully mean that they choose to return on a regular basis.
The quality of our staff is key to the success of the business. We aim to ensure that we invest in our teams and compensate them appropriately thereby facilitating a positive working environment which aids staff retention and seeks to deliver our guests with a high level of customer service. All employees are paid at least the Real Living Wage.
There continues to be ongoing pressure on consumer’s disposable incomes and we are very mindful of the need to ensure that the prices that we charge are fair and reasonable for our services and our guests consider them to be good value for money.
Section 172(1) Statement
The board of directors of Red Hotels Limited individually believe that they have acted in the way they consider, in good faith, would be most likely to promote the success of the group for the benefit of its members as a whole in line with their duties under Section 172(1) of Companies Act 2006 in the decisions taken during the period ending 29 December 2024 when operating and managing the Bedruthan Hotel and Scarlet Hotel.
To assist them in discharging their duty under s172 Companies Act 2006, the Directors engage with employees, customers and suppliers to reflect their insights and views when making decisions on strategy; delivering operational effectiveness, driving initiatives; and committing to deliver outcomes that enhance social value. Below are examples of how the Directors engage with stakeholders:
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Employees: The involvement and engagement of employees is vital to our business. The group employs staff across both hotel locations. We aim to be a responsible employer in our approach to the pay and benefits our team members receive. This is evidenced by the fact that all members of the team receive at least the Real Living Wage. The health, safety and well-being of our team members is one of the primary factors in the way we do business. We aim to provide career development opportunities, maintain a positive work culture, and promote internal advancement wherever possible. |
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Guests: The Directors place significant value on the engagement and treatment of our guests. Our aim is to deliver a fantastic experience and gain their desire to return. We treat our guest’s safety as one of our top priorities. |
Red Hotels Limited
(Registration number: 06547005)
Strategic Report for the period from 1 January 2024 to 29 December 2024
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Suppliers: Suppliers are not decided purely based on price but also for their quality, impact on the environment and local community and how they conduct business. The group has established relationships with local suppliers as part of its goal to prioritise long-term, mutually beneficial partnerships. |
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Community: In operating our Hotels, we take into account the impact of the group’s operations on the community and environment and our wider social responsibilities, and in particular how we comply with legislation and react promptly to local community concerns. The group continues to support the Cornwall Wildlife Trust largest ever nature recovery project through its community fund and is also active in the campaign for more fit for purpose, affordable housing through its support of Homes for Cornwall. |
The directors are dedicated to maintaining the highest standards of business conduct and ethical behaviour. The group has a robust code of conduct that guides its employees’ actions and ensures they operate with integrity and transparency.
The directors are committed to treating all shareholders and stakeholders fairly and transparently. Strategic and financial decisions are communicated to shareholders in a timely and balanced manner. The board ensures oversight of both hotels while balancing the interests of each.
Non-financial and sustainability information
Streamlined energy and carbon reporting
This report meets the climate-related financial disclosure requirements per the Companies (Directors' Report) and Limited Liability Partnerships (Energy and Carbon Report) Regulations 2018. Red Hotels Limited supports these disclosures and are committed to disclosing the relevant information which can be found below.
Emissions and energy consumption
The directors have followed the HM Government Environmental Reporting Guidelines. We have also used the GHG Reporting Protocol – Corporate Standard and have used the 2024 UK Government's Conversion Factors for Company Reporting.
Summary of greenhouse gas emissions and energy consumption for the period from 1 January 2024 to 29 December 2024:
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Name and |
Unit of |
2024 |
2023 |
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Total energy consumption |
kWh |
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Direct emissions (gas, fuels for boilers) |
CO2e |
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Indirect emissions (purchased electricity) |
CO2e |
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Total gross emissions |
CO2e |
799.80 |
727.90 |
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Number of occupied room nights |
48,307.00 |
47,775.00 |
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Intensity ratio Tonnes CO2e per Number of occupied room nights |
0.02 |
0.02 |
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Red Hotels Limited
(Registration number: 06547005)
Strategic Report for the period from 1 January 2024 to 29 December 2024
Intensity ratio
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Tonnes CO2e per number of occupied room nights
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Measures taken to improve energy efficiency
We have continued to install energy efficient measures when undertaking refurbishment and maintenance works. We have installed additional solar panels plus we have implemented a program for an LED retrofit. As an organisation, sustainability is central to our ethos so staff are encouraged to support a culture of energy-saving behaviour.
Future developments
Despite the challenges the Directors are committed to ensuring that they continue to invest in the facilities and the whole team. The Directors expect that the cost of living challenges, the vagaries of the British weather and the appetite for people to holiday in the UK rather than overseas, will continue to have an impact on the group. Since the year end and despite the significant increase in Employers National Insurance the group have generated improved cash from operations which has enabled it to reduce its net debt which puts it in a stronger position to face the various challenges impacting the hospitality sector. The group has a reputation for being a beacon of responsible tourism which comes from a willingness to innovate that aims to put the group at the forefront of hospitality in Cornwall.
Approved and authorised by the
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Red Hotels Limited
(Registration number: 06547005)
Directors' Report for the Period from 1 January 2024 to 29 December 2024
The directors present their report and the for the period from 1 January 2024 to 29 December 2024.
Directors of the group
The directors who held office during the period were as follows:
Financial instruments
Objectives and policies
The group's principal financial instruments comprise the bank balance, trade creditors, trade debtors and bank borrowings. The main purpose of these instruments is to raise funds to support the group's operations.
Price risk, credit risk, liquidity risk and cash flow risk
The company's approach to managing risks applicable to the financial instruments is shown below.
In respect of the bank balance, the liquidity risk is managed by maintaining a balance between the continuity of funding and flexibility through the use of bank borrowings at variable rates of interest.
Trade debtors are managed in respect of credit and cash flow by policies concerning the credit offered to customers and the regular monitoring of amounts outstanding for both time and credit limits. The amounts presented in the balance sheet are net of allowances for doubtful debts.
Trade creditors liquidity risk is managed by ensuring that sufficient funds are available to meet amounts due.
Loans are provided by financial institutions. The interest rates and monthly repayments are linked to base rates. The company manages the liquidity risk by ensuring that there are sufficient funds to meet the due instalments.
Employment of 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 group continues and that the appropriate training is arranged. It is the policy of the group that the training, career development and promotion of disabled persons should, as far as possible, be identical to that of other employees.
Red Hotels Limited
(Registration number: 06547005)
Directors' Report for the Period from 1 January 2024 to 29 December 2024
Employee involvement
The group's policy is to consult and discuss with employees matters likely to affect employees' interests.
Information on matters of concern to employees is given through information bulletins and reports which seek to achieve common awareness of the part of all employees of the financial and economic factors affecting the group's performance.
There is no employee share scheme at present.
Disclosure of information to the auditor
Each director has taken steps that they ought to have taken as a director in order to make themselves aware of any relevant audit information and to establish that the company's auditor is aware of that information. The directors confirm that there is no relevant information that they know of and of which they know the auditor is unaware.
Approved and authorised by the
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Red Hotels Limited
(Registration number: 06547005)
Statement of Directors' Responsibilities
The directors acknowledge their responsibilities for preparing the Annual Report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the group and the company and of the profit or loss of the group for that period. In preparing these financial statements, the directors are required to:
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select suitable accounting policies and apply them consistently; |
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make judgements and accounting estimates that are reasonable and prudent; |
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state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and |
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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 group's and the company's transactions and disclose with reasonable accuracy at any time the financial position of the group and 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 group and the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Red Hotels Limited
(Registration number: 06547005)
Independent Auditor's Report to the Members of Red Hotels Limited
Opinion
We have audited the financial statements of Red Hotels Limited (the 'parent company') and its subsidiaries (the 'group') for the period from 1 January 2024 to 29 December 2024, which comprise the Consolidated Profit and Loss Account, Consolidated Statement of Comprehensive Income, Consolidated Balance Sheet, Balance Sheet, Consolidated Statement of Changes in Equity, Statement of Changes in Equity, Consolidated Statement of Cash Flows, Statement of Cash Flows, and Notes to the Financial Statements, including a summary of 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 group's and the parent company's affairs as at 29 December 2024 and of the group's loss for the period then ended; |
• | have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and |
• | have been prepared in accordance with the requirements of the Companies Act 2006. |
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 responsibilities for the audit of the financial statements section of our report. We are independent of the group 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.
Other matters
The financial statements of the group for the year ended 31 December 2023 were audited by another auditor who expressed an unmodified opinion on those statements on 11 September 2024.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the director's use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the group's ability to continue as a going concern for a period of at least twelve months from when the original financial statements were authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
Other information
The directors are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. 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.
Red Hotels Limited
(Registration number: 06547005)
Independent Auditor's Report to the Members of Red Hotels Limited
In connection with our audit of the financial statements, 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 audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. 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 matter prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
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the information given in the Strategic Report and Directors' Report for the financial period for which the financial statements are prepared is consistent with the financial statements; and |
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the Strategic Report and 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 our 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 where the Companies Act 2006 requires us to report to you if, in our opinion:
• | adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or |
• | the parent company financial statements are not in agreement with the accounting records and returns; or |
• | certain disclosures of directors' remuneration specified by law are not made; or |
• | we have not received all the information and explanations we require for our audit. |
Responsibilities of directors
As explained more fully in the Statement of Directors' Responsibilities [set out on page 8], 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.
Red Hotels Limited
(Registration number: 06547005)
Independent Auditor's Report to the Members of Red Hotels Limited
Auditor 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.
As part of an audit in accordance with ISAs (UK), we exercise professional judgement and maintain professional scepticism throughout the audit.
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.
The extent to which the audit was considered capable of detecting irregularities including fraud
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:
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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; |
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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 hospitality and tourism sector; |
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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, and environmental legislation; |
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we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management, reviewing licenses, certificates and relevant correspondence including the inspection of legal correspondence; and |
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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:
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making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; and |
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considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations. |
Red Hotels Limited
(Registration number: 06547005)
Independent Auditor's Report to the Members of Red Hotels Limited
To address the risk of fraud through management bias and override of controls, we:
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performed analytical procedures to identify any unusual or unexpected relationships; |
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tested journal entries to identify unusual transactions; |
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assessed whether judgements and assumptions made in determining the accounting estimates were indicative of potential bias; and |
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investigated the rationale behind significant or unusual transactions. |
In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:
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agreeing financial statement disclosures to underlying supporting documentation; |
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reading the minutes of meetings of those charged with governance; |
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enquiring of management as to actual and potential litigation and claims; and |
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reviewing correspondence with HMRC, relevant regulators and the company’s legal advisors. |
There are inherent limitations in our audit procedures described above. 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 the 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.
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 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.
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For and on behalf of
28 Alexandra Terrace
Devon
EX8 1BD
Red Hotels Limited
(Registration number: 06547005)
Consolidated Profit and Loss Account for the Period from 1 January 2024 to 29 December 2024
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Note |
2024 |
2023 |
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Turnover |
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Cost of sales |
( |
( |
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Gross profit |
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Administrative expenses |
( |
( |
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Other operating income |
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Operating profit |
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Other interest receivable and similar income |
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Interest payable and similar expenses |
( |
( |
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(Loss)/profit before tax |
( |
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Taxation |
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( |
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(Loss)/profit for the financial period |
( |
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Profit/(loss) attributable to: |
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Owners of the company |
( |
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The above results were derived from continuing operations.
The group has no recognised gains or losses for the period other than the results above.
Red Hotels Limited
(Registration number: 06547005)
Consolidated Statement of Comprehensive Income for the Period from 1 January 2024 to 29 December 2024
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2024 |
2023 |
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(Loss)/profit for the period |
( |
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Total comprehensive income for the period |
( |
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Total comprehensive income attributable to: |
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Owners of the company |
( |
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Red Hotels Limited
(Registration number: 06547005)
Consolidated Balance Sheet as at 29 December 2024
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Note |
2024 |
2023 |
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Fixed assets |
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Tangible assets |
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Current assets |
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Stocks |
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Debtors |
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Cash at bank and in hand |
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||
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Creditors: Amounts falling due within one year |
( |
( |
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Net current liabilities |
( |
( |
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Total assets less current liabilities |
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|
Creditors: Amounts falling due after more than one year |
( |
( |
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Provisions for liabilities |
( |
( |
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Net assets |
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Capital and reserves |
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Called up share capital |
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Share premium reserve |
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Capital redemption reserve |
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Profit and loss account |
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Equity attributable to owners of the company |
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Total equity |
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Approved and authorised by the
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Red Hotels Limited
(Registration number: 06547005)
Balance Sheet as at 29 December 2024
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Note |
2024 |
2023 |
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Fixed assets |
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Tangible assets |
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Investments |
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Current assets |
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Debtors |
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Cash at bank and in hand |
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||
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Creditors: Amounts falling due within one year |
( |
( |
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Net current assets |
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Total assets less current liabilities |
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Creditors: Amounts falling due after more than one year |
( |
( |
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Net assets |
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Capital and reserves |
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Called up share capital |
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Capital redemption reserve |
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Profit and loss account |
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Total equity |
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The company made a profit after tax for the financial period of £118,472 (2023 - profit of £246,326).
Approved and authorised by the
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Red Hotels Limited
(Registration number: 06547005)
Consolidated Statement of Changes in Equity for the Period from 1 January 2024 to 29 December 2024
Equity attributable to the parent company
|
Share capital |
Share premium |
Capital redemption reserve |
Retained earnings |
Total |
Total equity |
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At 1 January 2024 |
|
|
|
|
|
|
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Loss for the period |
- |
- |
- |
( |
( |
( |
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Dividends |
- |
- |
- |
( |
( |
( |
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At 29 December 2024 |
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Share capital |
Share premium |
Capital redemption reserve |
Retained earnings |
Total |
Total equity |
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At 2 January 2023 |
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|
|
|
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Profit for the period |
- |
- |
- |
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|
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Dividends |
- |
- |
- |
( |
( |
( |
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At 31 December 2023 |
87,656 |
67,018 |
16,599 |
13,710,604 |
13,881,877 |
13,881,877 |
Red Hotels Limited
(Registration number: 06547005)
Statement of Changes in Equity for the Period from 1 January 2024 to 29 December 2024
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Share capital |
Capital redemption reserve |
Retained earnings |
Total |
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At 1 January 2024 |
|
|
|
|
|
Profit for the period |
- |
- |
|
|
|
Dividends |
- |
- |
( |
( |
|
At 29 December 2024 |
|
|
|
|
|
Share capital |
Capital redemption reserve |
Retained earnings |
Total |
|
|
At 2 January 2023 |
|
|
|
|
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Profit for the period |
- |
- |
|
|
|
Dividends |
- |
- |
( |
( |
|
At 31 December 2023 |
87,656 |
16,599 |
23,087 |
127,342 |
Red Hotels Limited
(Registration number: 06547005)
Consolidated Statement of Cash Flows for the Period from 1 January 2024 to 29 December 2024
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Note |
2024 |
2023 |
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Cash flows from operating activities |
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(Loss)/profit for the period |
( |
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Adjustments to cash flows from non-cash items |
|||
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Depreciation and amortisation |
|
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|
Finance income |
( |
( |
|
|
Finance costs |
|
|
|
|
Income tax expense |
( |
|
|
|
|
|
||
|
Working capital adjustments |
|||
|
(Increase)/decrease in stocks |
( |
|
|
|
Decrease in debtors |
|
|
|
|
Increase in creditors |
|
|
|
|
Cash generated from operations |
|
|
|
|
Income taxes paid |
( |
( |
|
|
Net cash flow from operating activities |
|
|
|
|
Cash flows from investing activities |
|||
|
Interest received |
|
|
|
|
Acquisitions of tangible assets |
( |
( |
|
|
Net cash flows from investing activities |
( |
( |
|
|
Cash flows from financing activities |
|||
|
Interest paid |
( |
( |
|
|
Repayment of bank borrowing |
( |
( |
|
|
Repayment of other borrowing |
- |
( |
|
|
Dividends paid |
( |
( |
|
|
Net cash flows from financing activities |
( |
( |
|
|
Net increase in cash and cash equivalents |
|
|
|
|
Cash and cash equivalents at 1 January |
|
|
|
|
Cash and cash equivalents at 29 December |
2,440,278 |
2,251,105 |
|
Red Hotels Limited
(Registration number: 06547005)
Statement of Cash Flows for the Period from 1 January 2024 to 29 December 2024
|
Note |
2024 |
2023 |
|
|
Cash flows from operating activities |
|||
|
Profit for the period |
|
|
|
|
Adjustments to cash flows from non-cash items |
|||
|
Depreciation and amortisation |
|
|
|
|
Finance income |
( |
( |
|
|
Finance costs |
|
|
|
|
( |
( |
||
|
Working capital adjustments |
|||
|
Increase in debtors |
( |
( |
|
|
Increase in creditors |
|
|
|
|
Net cash flow from operating activities |
( |
( |
|
|
Cash flows from investing activities |
|||
|
Interest received |
|
|
|
|
Acquisition of subsidiaries |
- |
( |
|
|
Acquisitions of tangible assets |
( |
- |
|
|
Net cash flows from investing activities |
|
|
|
|
Cash flows from financing activities |
|||
|
Interest paid |
( |
( |
|
|
Repayment of bank borrowing |
( |
( |
|
|
Dividends paid |
( |
( |
|
|
Net cash flows from financing activities |
( |
( |
|
|
Net (decrease)/increase in cash and cash equivalents |
( |
|
|
|
Cash and cash equivalents at 1 January |
|
|
|
|
Cash and cash equivalents at 29 December |
32,381 |
133,770 |
|
Red Hotels Limited
(Registration number: 06547005)
Notes to the Financial Statements for the Period from 1 January 2024 to 29 December 2024
|
General information |
The company is a private company limited by share capital, incorporated in England and Wales.
The address of its registered office is:
|
Accounting policies |
Summary of significant accounting policies and key accounting estimates
The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.
Statement of compliance
These financial statements were prepared in accordance with Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland and the Companies Act 2006'.
Basis of preparation
These financial statements have been prepared using the historical cost convention except that as disclosed in the accounting policies certain items are shown at fair value.
Basis of consolidation
The consolidated financial statements consolidate the financial statements of the company and its subsidiary undertakings drawn up to 29 December 2024.
No Profit and Loss Account is presented for the company as permitted by section 408 of the Companies Act 2006. The company made a profit after tax for the financial year of £118,472 (2023: £246,326).
Red Hotels Limited
(Registration number: 06547005)
Notes to the Financial Statements for the Period from 1 January 2024 to 29 December 2024
A subsidiary is an entity controlled by the company. Control is achieved where the company has the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities.
The results of subsidiaries acquired or disposed of during the year are included in the Profit and Loss Account from the effective date of acquisition or up to the effective date of disposal, as appropriate. Where necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with those used by the group.
The purchase method of accounting is used to account for business combinations that result in the acquisition of subsidiaries by the group. The cost of a business combination is measured as the fair value of the assets given, equity instruments issued and liabilities incurred or assumed at the date of exchange, plus costs directly attributable to the business combination. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. Any excess of the cost of the business combination over the acquirer’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities recognised is recorded as goodwill.
Inter-company transactions, balances and unrealised gains on transactions between the company and its subsidiaries, which are related parties, are eliminated in full.
Intra-group losses are also eliminated but may indicate an impairment that requires recognition in the consolidated financial statements.
Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the group. Non-controlling interests in the net assets of consolidated subsidiaries are identified separately from the group’s equity therein. Non-controlling interests consist of the amount of those interests at the date of the original business combination and the non-controlling shareholder’s share of changes in equity since the date of the combination.
Going concern
The financial statements have been prepared on a going concern basis.
Red Hotels Limited
(Registration number: 06547005)
Notes to the Financial Statements for the Period from 1 January 2024 to 29 December 2024
Key sources of estimation uncertainty
The company makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing material adjustments to the carrying amounts of assets and liabilities within the next financial year are addressed below:
a) Useful economic lives and residual values of tangible assets
The annual depreciation charge for tangible assets is sensitive to changes in the estimated useful economic lives and residual values of the assets. The useful economic lives and residual values are re-assessed annually. They are amended when necessary to reflect current estimates, based on economic utilisation and the physical condition of the assets. See note 12 for the carrying amount of the tangible fixed assets.
Revenue recognition
Turnover comprises the fair value of the consideration received or receivable for the sale of goods and provision of services in the ordinary course of the company’s activities. Turnover is shown net of sales/value added tax, returns, rebates and discounts. The company recognises revenue when, the amount of revenue can be reliably measured and it is probable that future economic benefits will flow to the entity. As such revenue in relation to accommodation, spa, food and beverages are recognised in the period in which the service has been provided to the customer. Deposits received in advance of the service being provided are held within other creditors and released on provision of the service.
Foreign currency transactions and balances
Non-monetary items measured in terms of historical cost in a foreign currency are not retranslated.
Tax
The tax expense for the period comprises current and deferred tax. Tax is recognised in profit or loss, except that a change attributable to an item of income or expense recognised as other comprehensive income is also recognised directly in other comprehensive income.
The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the group operates and generates taxable income.
Deferred income tax is recognised on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements and on unused tax losses or tax credits in the group. Deferred income tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.
The carrying amount of deferred tax assets are reviewed at each reporting date and a valuation allowance is set up against deferred tax assets so that the net carrying amount equals the highest amount that is more likely than not to be recovered based on current or future taxable profit.
Red Hotels Limited
(Registration number: 06547005)
Notes to the Financial Statements for the Period from 1 January 2024 to 29 December 2024
Tangible assets
Tangible assets are stated in the balance sheet at cost, less any subsequent accumulated depreciation and subsequent accumulated impairment losses.
The cost of tangible assets includes directly attributable incremental costs incurred in their acquisition and installation.
Depreciation
Depreciation is charged so as to write off the cost of assets, other than land and properties under construction over their estimated useful lives, as follows:
|
Asset class |
Depreciation method and rate |
|
Hotel freehold property |
Nil |
|
Other freehold property |
2% straight line basis |
|
Plant and machinery |
20% and 25% straight line basis |
|
Fixtures, fittings and equipment |
4%, 10% and 20% straight line basis |
|
Motor vehicles |
25% straight line basis |
Freehold land is not depreciated. The hotel buildings are maintained, as a matter of policy, by a programme of repair and refurbishment such that the residual value is at least equal to the book value. The residual value is based on the estimated amount that would be currently obtainable from disposal of the asset net of disposal costs if the asset were already of the age and condition expected at the end of its useful life.
An assessment of the hotel's residual value is performed at the end of each reporting period. In addition, the directors' policy is to ensure that the annual budget for repair and refurbishment projects takes into account matters raised in the annual impairment review.
Having regard to this, the directors are of the opinion that depreciation on the hotel buildings would not be material.
Business combinations
Business combinations are accounted for using the purchase method. The consideration for each acquisition is measured at the aggregate of the fair values at acquisition date of assets given, liabilities incurred or assumed, and equity instruments issued by the group in exchange for control of the acquired, plus any costs directly attributable to the business combination. When a business combination agreement provides for an adjustment to the cost of the combination contingent on future events, the group includes the estimated amount of that adjustment in the cost of the combination at the acquisition date if the adjustment is probable and can be measured reliably.
Investments
Investments in equity shares which are publicly traded or where the fair value can be measured reliably are initially measured at fair value, with changes in fair value recognised in profit or loss. Investments in equity shares which are not publicly traded and where fair value cannot be measured reliably are measured at cost less impairment.
Interest income on debt securities, where applicable, is recognised in income using the effective interest method. Dividends on equity securities are recognised in income when receivable.
Red Hotels Limited
(Registration number: 06547005)
Notes to the Financial Statements for the Period from 1 January 2024 to 29 December 2024
Cash and cash equivalents
Cash and cash equivalents comprise cash on hand and call deposits, and other short-term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of change in value.
Trade debtors
Trade debtors are amounts due from customers for merchandise sold or services performed in the ordinary course of business.
Trade debtors are recognised initially at the transaction price. They are subsequently measured at amortised cost using the effective interest method, less provision for impairment. A provision for the impairment of trade debtors is established when there is objective evidence that the group will not be able to collect all amounts due according to the original terms of the receivables.
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost is determined using the first-in, first-out (FIFO) method.
The cost of finished goods and work in progress comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the inventories to their present location and condition. At each reporting date, stocks are assessed for impairment. If stocks are impaired, the carrying amount is reduced to its selling price less costs to complete and sell; the impairment loss is recognised immediately in profit or loss.
Trade creditors
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if the group does not have an unconditional right, at the end of the reporting period, to defer settlement of the creditor for at least twelve months after the reporting date. If there is an unconditional right to defer settlement for at least twelve months after the reporting date, they are presented as non-current liabilities.
Trade creditors are recognised initially at the transaction price and subsequently measured at amortised cost using the effective interest method.
Borrowings
Interest-bearing borrowings are initially recorded at fair value, net of transaction costs. Interest-bearing borrowings are subsequently carried at amortised cost, with the difference between the proceeds, net of transaction costs, and the amount due on redemption being recognised as a charge to the profit and loss account over the period of the relevant borrowing.
Interest expense is recognised on the basis of the effective interest method and is included in interest payable and similar charges.
Borrowings are classified as current liabilities unless the group has an unconditional right to defer settlement of the liability for at least twelve months after the reporting date.
Red Hotels Limited
(Registration number: 06547005)
Notes to the Financial Statements for the Period from 1 January 2024 to 29 December 2024
Leases
Leases in which substantially all the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases are charged to profit or loss on a straight-line basis over the period of the lease.
Share capital
Ordinary shares are classified as equity. Equity instruments are measured at the fair value of the cash or other resources received or receivable, net of the direct costs of issuing the equity instruments. If payment is deferred and the time value of money is material, the initial measurement is on a present value basis.
Dividends
Dividend distribution to the group’s shareholders is recognised as a liability in the financial statements in the reporting period in which the dividends are declared.
Defined contribution pension obligation
A defined contribution plan is a pension plan under which fixed contributions are paid into a pension fund and the group has no legal or constructive obligation to pay further contributions even if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods.
Contributions to defined contribution plans are recognised as employee benefit expense when they are due. If contribution payments exceed the contribution due for service, the excess is recognised as a prepayment.
|
Turnover |
The analysis of the group's Turnover for the period from continuing operations is as follows:
|
2024 |
2023 |
|
|
Accommodation |
6,465,154 |
6,928,745 |
|
Food and beverage |
4,760,280 |
4,690,935 |
|
Sundry operations |
236,130 |
148,410 |
|
Spa income |
1,444,959 |
1,549,606 |
|
|
|
|
Other operating income |
The analysis of the group's other operating income for the period is as follows:
|
2024 |
2023 |
|
|
Rent receivable from staff accommodation |
|
|
Red Hotels Limited
(Registration number: 06547005)
Notes to the Financial Statements for the Period from 1 January 2024 to 29 December 2024
|
Operating profit |
Arrived at after charging/(crediting)
|
2024 |
2023 |
|
|
Depreciation expense |
|
|
|
Operating lease expense - other |
|
|
|
Other interest receivable and similar income |
|
2024 |
2023 |
|
|
Interest income on bank deposits |
|
|
|
Interest payable and similar expenses |
|
2024 |
2023 |
|
|
Interest on bank overdrafts and borrowings |
|
|
|
Interest expense on other finance liabilities |
|
|
|
Foreign exchange losses |
( |
- |
|
|
|
|
Staff costs |
The aggregate payroll costs (including directors' remuneration) were as follows:
|
2024 |
2023 |
|
|
Wages and salaries |
|
|
|
Social security costs |
|
|
|
Pension costs, defined contribution scheme |
|
|
|
|
|
The average number of persons employed by the group during the period, analysed by category was as follows:
|
2024 |
2023 |
|
|
Operations |
|
|
|
Management and Heads of Departments |
|
|
|
|
|
Red Hotels Limited
(Registration number: 06547005)
Notes to the Financial Statements for the Period from 1 January 2024 to 29 December 2024
|
Directors' remuneration |
The directors' remuneration for the period was as follows:
|
2024 |
2023 |
|
|
Remuneration |
|
|
|
Contributions paid to money purchase schemes |
|
|
|
144,679 |
152,754 |
During the period the number of directors who were receiving benefits was as follows:
|
2024 |
2023 |
|
|
Accruing benefits under money purchase pension scheme |
|
- |
|
Auditors' remuneration |
|
2024 |
2023 |
|
|
Audit of these financial statements |
24,185 |
15,000 |
|
Other fees to auditors |
||
|
All other non-audit services |
|
|
|
Taxation |
Tax charged/(credited) in the consolidated profit and loss account
|
2024 |
2023 |
|
|
Current taxation |
||
|
UK corporation tax |
- |
|
|
UK corporation tax adjustment to prior periods |
|
( |
|
617 |
154,043 |
|
|
Deferred taxation |
||
|
Arising from origination and reversal of timing differences |
( |
( |
|
Tax (receipt)/expense in the income statement |
( |
|
Red Hotels Limited
(Registration number: 06547005)
Notes to the Financial Statements for the Period from 1 January 2024 to 29 December 2024
The tax on profit before tax for the period is higher than the standard rate of corporation tax in the UK (2023 - lower than the standard rate of corporation tax in the UK) of
The differences are reconciled below:
|
2024 |
2023 |
|
|
(Loss)/profit before tax |
( |
|
|
Corporation tax at standard rate |
( |
|
|
Increase/(decrease) in UK and foreign current tax from adjustment for prior periods |
|
( |
|
Tax increase from effect of capital allowances and depreciation |
|
|
|
Effect of expense not deductible in determining taxable profit (tax loss) |
|
|
|
Deferred tax credit from unrecognised temporary difference from a prior period |
( |
( |
|
Further item of tax decrease |
- |
( |
|
Total tax (credit)/charge |
( |
|
Deferred tax
Group
Deferred tax assets and liabilities
|
2024 |
Liability |
|
Accelerated tax depreciation |
|
|
Accrued liabilities |
( |
|
Tax losses carried forwards |
( |
|
|
|
2023 |
Liability |
|
Accelerated tax depreciation |
|
|
Accrued liabilities |
( |
|
|
Red Hotels Limited
(Registration number: 06547005)
Notes to the Financial Statements for the Period from 1 January 2024 to 29 December 2024
|
Tangible assets |
Group
|
Land and buildings |
Furniture, fittings and equipment |
Motor vehicles |
Plant & machinery |
Total |
|
|
Cost or valuation |
|||||
|
At 1 January 2024 |
|
|
|
|
|
|
Additions |
|
|
- |
|
|
|
At 29 December 2024 |
|
|
|
|
|
|
Depreciation |
|||||
|
At 1 January 2024 |
|
|
|
|
|
|
Charge for the period |
|
|
- |
|
|
|
At 29 December 2024 |
|
|
|
|
|
|
Carrying amount |
|||||
|
At 29 December 2024 |
|
|
- |
|
|
|
At 31 December 2023 |
|
|
- |
|
|
Included within the net book value of land and buildings above is £20,292,452 (2023 - £20,303,422) in respect of freehold land and buildings.
Red Hotels Limited
(Registration number: 06547005)
Notes to the Financial Statements for the Period from 1 January 2024 to 29 December 2024
Company
|
Land and buildings |
Total |
|
|
Cost or valuation |
||
|
At 1 January 2024 |
|
|
|
Additions |
|
|
|
At 29 December 2024 |
|
|
|
Depreciation |
||
|
At 1 January 2024 |
|
|
|
Charge for the period |
|
|
|
At 29 December 2024 |
|
|
|
Carrying amount |
||
|
At 29 December 2024 |
|
|
|
At 31 December 2023 |
|
|
Included within the net book value of land and buildings above is £1,097,554 (2023 - £1,108,524) in respect of freehold land and buildings.
|
Investments |
Company
|
2024 |
2023 |
|
|
Investments in subsidiaries |
|
|
|
Subsidiaries |
£ |
|
Cost or valuation |
|
|
At 1 January 2024 |
|
|
At 29 December 2024 |
|
|
Carrying amount |
|
|
At 29 December 2024 |
|
|
At 31 December 2023 |
|
Red Hotels Limited
(Registration number: 06547005)
Notes to the Financial Statements for the Period from 1 January 2024 to 29 December 2024
Details of undertakings
Details of the investments (including principal place of business of unincorporated entities) in which the company holds 20% or more of the nominal value of any class of share capital are as follows:
|
Undertaking |
Registered office |
Holding |
Proportion of voting rights and shares held |
|
|
2024 |
2023 |
|||
|
Subsidiary undertakings |
||||
|
|
Scarlet Hotel, Tredragon Road, Mawgan Porth, Newquay, TR8 4DQ |
|
|
|
|
|
Bedruthan Hotel, Mawgan Porth, Newquay, TR8 4BU |
|
|
|
|
|
Bedruthan House, Mawgan Porth, Newquay, TR8 4BU |
|
|
|
|
Subsidiary undertakings |
|
Scarlet Hotel Limited The principal activity of Scarlet Hotel Limited is |
|
Bedruthan Hotel Limited The principal activity of Bedruthan Hotel Limited is |
|
Trenance Roads Limited The principal activity of Trenance Roads Limited is |
|
Stocks |
|
Group |
Company |
|||
|
2024 |
2023 |
2024 |
2023 |
|
|
Finished goods and goods for resale |
|
|
- |
- |
Red Hotels Limited
(Registration number: 06547005)
Notes to the Financial Statements for the Period from 1 January 2024 to 29 December 2024
|
Debtors |
|
Group |
Company |
|||
|
2024 |
2023 |
2024 |
2023 |
|
|
Trade debtors |
|
|
- |
- |
|
Amounts owed by related parties |
- |
- |
|
|
|
Other debtors |
|
|
- |
- |
|
Prepayments and accrued income |
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
Group |
Company |
|||
|
2024 |
2023 |
2024 |
2023 |
|
|
Cash on hand |
|
|
- |
- |
|
Cash at bank |
|
|
|
|
|
Short-term deposits |
|
|
- |
- |
|
|
|
|
|
|
|
Creditors |
|
Group |
Company |
||||
|
Note |
2024 |
2023 |
2024 |
2023 |
|
|
Due within one year |
|||||
|
Loans and borrowings |
|
|
|
|
|
|
Trade creditors |
|
|
- |
|
|
|
Amounts due to related parties |
- |
- |
|
|
|
|
Social security and other taxes |
|
|
|
|
|
|
Other creditors |
|
|
|
|
|
|
Accruals |
|
|
|
|
|
|
Corporation tax liability |
- |
58,768 |
- |
- |
|
|
|
|
|
|
||
|
Due after one year |
|||||
|
Loans and borrowings |
|
|
|
|
|
Red Hotels Limited
(Registration number: 06547005)
Notes to the Financial Statements for the Period from 1 January 2024 to 29 December 2024
|
Loans and borrowings |
Current loans and borrowings
|
Group |
Company |
|||
|
2024 |
2023 |
2024 |
2023 |
|
|
Bank borrowings |
|
|
|
|
Non-current loans and borrowings
|
Group |
Company |
|||
|
2024 |
2023 |
2024 |
2023 |
|
|
Bank borrowings |
|
|
|
|
Group
Bank borrowings
|
The bank borrowings are secured by a charge over the group's freehold land and buildings and cross guaranteed by the other group members Bedruthan Hotel Limited and Scarlet Hotel Limited. |
|
Pension and other schemes |
Defined contribution pension scheme
The group operates a defined contribution pension scheme. The pension cost charge for the period represents contributions payable by the group to the scheme and amounted to £
Contributions totalling £
Red Hotels Limited
(Registration number: 06547005)
Notes to the Financial Statements for the Period from 1 January 2024 to 29 December 2024
|
Provisions for liabilities |
Group
|
Deferred tax |
Total |
|
|
At 1 January 2024 |
|
|
|
Increase (decrease) in existing provisions |
( |
( |
|
At 29 December 2024 |
|
|
|
|
||
|
Share capital |
Allotted, called up and fully paid shares
|
2024 |
2023 |
|||
|
No. |
£ |
No. |
£ |
|
|
|
|
87,656 |
|
87,656 |
Rights, preferences and restrictions
|
Ordinary shares have the following rights, preferences and restrictions: |
|
Reserves |
Group
Share capital
Called up share capital represents the nominal value of the shares issued.
Capital redemption reserve
Capital redemption reserve represents the nominal value of shares repurchased by the company.
Profit and loss account
Profit and loss account represents the cumulative profits or losses, net of dividends paid and other adjustments
Share premium reserve
Share premium reserve represents the premium received on the issue of share capital, less transaction costs
Red Hotels Limited
(Registration number: 06547005)
Notes to the Financial Statements for the Period from 1 January 2024 to 29 December 2024
|
Dividends |
Interim dividends paid
|
2024 |
2023 |
|||
|
Interim dividend of £ |
|
|
||
|
Analysis of changes in net debt |
Group
|
At 1 January 2024 |
Financing cash flows |
Other non-cash changes |
At 29 December 2024 |
|
|
Cash and cash equivalents |
||||
|
Cash |
2,251,105 |
189,173 |
- |
2,440,278 |
|
Borrowings |
||||
|
Long term borrowings |
(6,063,318) |
- |
125,958 |
(5,937,360) |
|
Short term borrowings |
(166,244) |
120,663 |
(125,958) |
(171,539) |
|
(6,229,562) |
120,663 |
- |
(6,108,899) |
|
|
|
||||
|
( |
|
- |
( |
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Red Hotels Limited
(Registration number: 06547005)
Notes to the Financial Statements for the Period from 1 January 2024 to 29 December 2024
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Related party transactions |
Group
R J Waghorn, director, is a partner of Waghorn Partnership. Amounts paid to Waghorn Partnership in respect of training, consultancy and director's fees amounted to £39,278 (2023: £16,008). The balance owed to Waghorn Partnership at the year end was £nil (2023: £nil).
C Stratton, husband of E Stratton, director, charged £23,750 (2023: £14,540) during the year in respect of financial consultancy. The balance owed to C Stratton at the year end was £24,750 (2023: £nil).
The company has a trading relationship with St Austell Brewery Company Limited, a company whose Chief Financial Office, C Stratton, is the husband of E Stratton, director. During the year the company made purchases from St Austell Brewery Company Limited or £80,197 (2023: £66,480). The balance owing at the year end was £11,251 (2023: £5,207).
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Controlling party |
The ultimate controlling party is