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Registered number: 06270239
KNBY LND OP1 LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
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KNBY LND OP1 LIMITED
COMPANY INFORMATION
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S Pakula (appointed 24 August 2023)
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Chartered Accountants & Statutory Auditor
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KNBY LND OP1 LIMITED
CONTENTS
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Independent Auditors' Report
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Statement of Comprehensive Income
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Statement of Financial Position
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Statement of Changes in Equity
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Notes to the Financial Statements
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KNBY LND OP1 LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 30 JUNE 2024
The directors present their company strategic report for the year ended 30 June 2024.
These financial statement reflect a full year of normal trading, with turnover at £7.2 million (2023 - £7.7 million), and a profit before tax of £489,948 (2023 - £906,170). The Company is a wholly owned subsidiary of KNBY (UK) Limited and a detailed review of the business is included in the Group's strategic report.
Going concern
The directors are of the opinion that the Company has the ability to withstand possible downside scenarios should they arise. Therefore, the directors are of the opinion that the Company will continue to be able to meet its liabilities as they fall due for at least the 12 months following the date of their approval of the financial statements.
Principal risks and uncertainties
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The assessment of risks faced by the Company and the development of strategies for dealing with these risks is achieved on an ongoing basis through the way in which the Company is controlled and managed. The risk management process seeks to enable the early identification, evaluation and effective management of the key risks facing the businesses at an operational level and to operate internal controls, which adequately mitigate these risks. The Company regularly assesses its risk management activities to ensure good practice in all areas.
The principal risks and uncertainties are as follows:
∙Competitive Landscape: London is known for its vibrant restaurant scene, and the competition among upscale restaurants can be fierce.
∙Economic Factors: The current economic climate has impacted consumer spending habits, including the effect of fluctuations in currency exchange rates on overseas visitors.
∙Cost Management: The company has implemented systems and procedures to help mitigate the impact of increases in operating costs, including staff wages, quality ingredients, and maintaining an elegant atmosphere.
∙Ensuring effective cost management through efficient procurement, stock control, and optimisation of staff numbers is crucial for maintaining profitability.
∙Staffing and Training: Hiring and retaining skilled staff, including chefs, sommeliers, and waitstaff, can be a challenge. There is a risk of staff turnover, which can impact service quality and customer satisfaction. Providing competitive salaries, creating a positive work environment, and investing in staff training and development can help mitigate this risk.
∙Regulatory and Compliance: The restaurant industry is subject to various regulations and compliance requirements, such as health and safety standards, food hygiene regulations, licensing, and employment laws. Failing to comply with these regulations can result in penalties, reputational damage, or even closure. Staying updated on the relevant regulations and maintaining strict compliance is essential.
∙Customer Preferences and Trends: Consumer preferences and dining trends can evolve rapidly, and it is important to adapt to changing customer demands, such as dietary preferences, sustainability, or technology integration, to maintain relevance and a strong customer base.
∙Online Reputation Management: In today's digital age, online reviews and social media presence play a significant role in shaping a restaurant's reputation. Negative reviews or poor social media management can harm a restaurant's image and deter potential customers. Actively managing customer feedback and reviews is essential to maintaining a positive reputation.
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KNBY LND OP1 LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
Financial key performance indicators
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In line with our operating objectives, we use both financial and non-financial KPIs. Where relevant, KPIs are used as our primary measure of whether we are achieving our objectives. However, the scale and size of our operations means that we use many other detailed performance measures in addition to KPIs. We also use KPIs to measure performance against our primary objective of growing our business to create value for the shareholder. We use qualitative assessments to judge progress against our objectives in areas where numerical measures are less relevant.
The KPIs used to measure performance include turnover growth year on year, gross profit margin and adjusted EBITDA margin. We benchmark these measures against the appropriate industry competitors and make the necessary controls to ensure that we achieve our target ratios.
Other key performance indicators
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The directors consider the number of future bookings of the private dining area and reviews by customers on third party websites as they key non-financial performance indicators.
This report was approved by the board and signed on its behalf.
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KNBY LND OP1 LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2024
The directors present their report and the financial statements for the year ended 30 June 2024.
Directors' responsibilities statement
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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 2006. They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
KNBY LND OP1 Limited ("The Company") operates two restaurants which serves a Russian-inspired modern British and French menu and cocktails.
The company operates from two restaurants:
∙Bob Bob Ricard, 1 Upper James Street, Soho, London, W1F 9DF
∙Bébé Bob, 37 Golden Square, London W1F 9LB
The profit for the year, after taxation, amounted to £489,948 (2023 - £906,170).
No dividends have been proposed or paid during the year (2023 - £nil).
The directors who served during the year were:
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S Pakula (appointed 24 August 2023)
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KNBY LND OP1 LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
There are no plans which will significantly change the activities and risks of the Company.
Disclosure of information to auditors
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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 auditors are 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 auditors are aware of that information.
Post balance sheet events
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Subsequent to the year-end, the Company has entered into negotiations with its lenders regarding the refinancing of its existing debt facilities. As at the date of approval of the financial statements, these discussions are ongoing.
During the year, Sopher + Co LLP resigned as auditors and BKL Audit LLP were appointed in their stead.
Under section 487(2) of the Companies Act 2006, BKL Audit LLP will be deemed to have been reappointed as auditors 28 days after these financial statements were sent to members or 28 days after the latest date prescribed for filing the accounts with the registrar, whichever is earlier.
This report was approved by the board and signed on its behalf.
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KNBY LND OP1 LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF KNBY LND OP1 LIMITED
We have audited the financial statements of KNBY LND OP1 Limited (the 'Company') for the year ended 30 June 2024, 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 policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
∙give a true and fair view of the state of the Company's affairs as at 30 June 2024 and of its profit for the year then ended;
∙have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
∙have been prepared in accordance with the requirements of the Companies Act 2006.
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' 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
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In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' Report thereon. The directors are responsible for the other information contained within the Annual Report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
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KNBY LND OP1 LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF KNBY LND OP1 LIMITED (CONTINUED)
We have nothing to report in this regard.
Opinion on other matters prescribed by the Companies Act 2006
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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
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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
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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.
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KNBY LND OP1 LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF KNBY LND OP1 LIMITED (CONTINUED)
Auditors' responsibilities for the audit of the financial statements
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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 Auditors' 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:
∙Enquiring of management and those charged with governance around actual and potential litigation and claims;
∙Reviewing the general ledger in detail for all transactions with related parties;
∙Performing walkthrough testing to ensure systems and controls are operating as recorded where appropriate;
∙Performing audit work over the risk of 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.
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.
As part of an audit in accordance with ISAs (UK), we exercise professional judgment and maintain professional scepticism throughout the audit. We also:
∙Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
∙Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion of the effectiveness of the Company's internal control.
∙Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors.
∙Conclude on the appropriateness of the directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our Auditors' Report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our Auditors' Report. However, future events or conditions may cause the Company to cease to continue as a going concern.
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KNBY LND OP1 LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF KNBY LND OP1 LIMITED (CONTINUED)
∙Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
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 Auditors' 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.
Catalina Feier FCA (Senior Statutory Auditor)
for and on behalf of
BKL Audit LLP
Chartered Accountants
Statutory Auditor
35 Ballards Lane
London
N3 1XW
26 September 2025
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KNBY LND OP1 LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2024
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Interest receivable and similar income
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Interest payable and similar expenses
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Profit for the financial year
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Other comprehensive income for the year
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Revaluation loss on leasehold interest
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Deferred tax movement on revaluation of leasehold interest
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Other comprehensive loss for the year
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Total comprehensive income / (loss) for the year
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The notes on pages 13 to 29 form part of these financial statements.
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KNBY LND OP1 LIMITED
REGISTERED NUMBER: 06270239
STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2024
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Debtors: amounts falling due within one year
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Creditors: amounts falling due within one year
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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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The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 13 to 29 form part of these financial statements.
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KNBY LND OP1 LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2024
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At 1 July 2023 (as previously stated)
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Prior year adjustment - correction of error
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At 1 July 2023 (as restated)
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The notes on pages 13 to 29 form part of these financial statements.
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KNBY LND OP1 LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2023
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Comprehensive income for the year
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Revaluation loss on leasehold interest (as restated)
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Deferred tax movement on revaluation of leasehold interest (as restated)
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Transfer to/from profit and loss account (as restated)
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At 30 June 2023 (as restated)
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The notes on pages 13 to 29 form part of these financial statements.
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KNBY LND OP1 LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
KNBY LND OP1 Limited is a private company, limited by shares, and incorporated in England and Wales.
The business and registered office address is at C/O Bob Bob Ricard, 1-3 Upper James Street, London, W1F 9DF.
KNBY LND OP1 Limited ("The Company") operates two restaurants which serves a Russian-inspired modern British and French menu and cocktails.
The company operates from two restaurants:
∙Bob Bob Ricard, 1 Upper James Street, Soho, London, W1F 9DF
∙Bébé Bob, 37 Golden Square, London W1F 9LB
2.Accounting policies
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Basis of preparation of financial statements
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The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgment in applying the Company's accounting policies (see note 3).
The following principal accounting policies have been applied:
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Financial Reporting Standard 102 - reduced disclosure exemptions
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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 33 Related Party Disclosures paragraph 33.7.
This information is included in the consolidated financial statements of KNBY (UK) Limited as at 30th June 2024 and these financial statements may be obtained from Companies House.
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KNBY LND OP1 LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
2.Accounting policies (continued)
The financial statements have been prepared on the going concern basis, which assumes that the Company will continue to trade for the foreseeable future, being a period of at least twelve months from the date of approval of these financial statements, and will be able to meet its debts as they fall due.
The financial statements show a profit for the year after tax of £489,948 (2023: £906,170) and net assets of £4,811,493 (2023: £4,321,545).
The directors have assessed whether the Company has adequate resources to meet its obligations as they fall due and beyond the 12 months from the date of the approval of these financial statements.
The directors have prepared cash flow forecasts until October 2026, under the current economic conditions and based on the key assumption that the restaurants will remain open for the foreseeable future.
As a result of these projections, the directors are confident that the Company can meet its debts as they fall due and beyond 12 months from the date of signing these financial statements.
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Foreign currency translation
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Functional and presentation currency
The Company's functional and presentational currency is GBP.
Transactions and balances
Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.
At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.
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.
Revenue comprises both income arising from the sale of food and drink net of value added tax and income arising as a result of service charges relating to the sale of this food and drink.
Revenue is recognised when food and drink is provided to the customer.
Interest income is recognised in profit or loss using the effective interest method.
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KNBY LND OP1 LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
2.Accounting policies (continued)
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.
All borrowing costs are recognised in profit or loss in the year in which they are incurred.
Defined contribution pension plan
The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations.
The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Statement of Financial Position. The assets of the plan are held separately from the Company in independently administered funds.
Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.
All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.
The estimated useful lives range as follows:
Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.
At each reporting date the Company assesses whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined which is the higher of its fair value less costs to sell and its value in use. An impairment loss is recognised where the carrying amount exceeds the recoverable amount.
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KNBY LND OP1 LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
2.Accounting policies (continued)
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Tangible fixed assets (continued)
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Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.
Depreciation is provided on the following basis:
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Short-term leasehold property
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over the period of the lease
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Items are deemed to have indefinite useful life, therefore its appropriate that no depreciation is applied
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The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.
Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis.
At each reporting date, stocks are assessed for impairment. If stock is 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.
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Cash and cash equivalents
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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.
The Company only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in ordinary shares.
(i) Financial assets
Basic financial assets, including trade and other debtors, cash and bank balances are initially recognised at transaction price, 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.
Such assets are subsequently carried at amortised cost using the effective interest method. At the
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KNBY LND OP1 LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
2.Accounting policies (continued)
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Financial instruments (continued)
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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 the Statement of Comprehensive Income.
Financial assets are derecognised when (a) the contractual rights to the cash flows from the asset expire or are settled, or (b) substantially all the risks and rewards of the ownership of the asset are transferred to another party or (c) control of the asset has been transferred to another party who has the practical ability to unilaterally sell the asset to an unrelated third party without imposing additional restrictions.
(ii) Financial liabilities
Basic financial liabilities, including trade and other creditors and accruals, are initially recognised at transaction price, unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Trade creditors are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Financial liabilities are derecognised when the liability is extinguished, that is when the contractual obligation is discharged, cancelled or expires.
(iii) Offsetting
Financial assets and liabilities are offset and the net amounts presented in the financial statements when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
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KNBY LND OP1 LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
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Judgments in applying accounting policies and key sources of estimation uncertainty
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The key assumptions about the future, and other key sources of estimation uncertainty at the reporting period end that may have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities within the next financial year are discussed below:
Going concern assumption
As outlined in Note 2.3, the Directors have prepared the financial statements on a going concern basis and believe this remains appropriate. The Directors' going concern assessment is based on forecasted cash flows prepared under current economic conditions which support the conclusion that the Company can continue to operate for at least 12 months from the date of approval of the financial statements. However, this judgement is sensitive to changes in the macroeconomic environment, and a material deterioration could impact the validity of the forecasts and the going concern assumption.
Valuation of leasehold interest
A revaluation of the leasehold interest is performed with sufficient regularity to ensure that the carrying amount of the leasehold interest does not differ materially from the fair value at the end of the reporting period. The valuations are based on external assessments of market conditions, lease terms and the expected future economic benefits to be derived from the property. Judgments and estimation techniques have been employed as part of the external valuation process in order to determine the current market value of the leasehold interest.
Valuation of stock
Management has exercised judgment in valuing the stock at the restaurants at the lower of cost and net realisable value. Due to the perishable nature of food stock and potential for wastage, estimates were made regarding expected usage, spoilage and selling prices.
Valuation of trade debtors
Management recognise trade debtors net of provisions for any irrecoverable amounts. The recoverable amounts are considered to be those debts recovered post year-end and provisions are recognised for all debts outstanding at the date of the financial statements, that are past their due date.
Useful economic life of tangible fixed assets
The annual depreciation charge for tangible fixed 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 amended when necessary to reflect current estimates, based on technological advancements, future investments, economic utilisation and the physical condition of the assets.
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KNBY LND OP1 LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
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An analysis of turnover by class of business is as follows:
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All turnover arose within the United Kingdom.
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The operating profit is stated after charging:
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Depreciation of tangible fixed assets
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Amortisation of intangible assets
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During the year, the Company obtained the following services from the Company's auditors:
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Fees payable to the Company's auditors for the audit of the Company's financial statements
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The Company has taken advantage of the exemption not to disclose amounts paid for non-audit services as these are disclosed in the consolidated accounts of the parent Company.
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KNBY LND OP1 LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
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Staff costs, including directors' remuneration, were as follows:
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Cost of defined contribution scheme
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The average monthly number of employees, including the directors, during the year was as follows:
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Front of house, kitchen and other
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Company contributions to defined contribution pension schemes
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During the year retirement benefits were accruing to 2 directors (2023 - 1) in respect of defined contribution pension schemes.
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Other interest receivable
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KNBY LND OP1 LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
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Interest payable and similar expenses
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Other loan interest payable
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Factors affecting tax charge for the year
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The tax assessed for the year is lower than (2023 - lower than) the standard rate of corporation tax in the UK of 25% (2023 - 20.5%). The differences are explained below:
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Profit on ordinary activities before tax
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Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 25% (2023 - 20.5%)
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Capital allowances for year in excess of depreciation
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Short-term timing difference leading to an increase (decrease) in taxation
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Total tax charge for the year
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KNBY LND OP1 LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
12.Taxation (continued)
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Factors that may affect future tax charges
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There were no factors that may affect future tax charges.
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Charge for the year on owned assets
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KNBY LND OP1 LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
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Short-term leasehold property
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At 1 July 2023 (as previously stated)
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At 1 July 2023 (as restated)
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At 1 July 2023 (as previously stated)
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At 1 July 2023 (as restated)
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Charge for the year on owned assets
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At 30 June 2023 (as restated)
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KNBY LND OP1 LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
14.Tangible fixed assets (continued)
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Fixed assets classified under "Other Fixed Assets" are not subject to depreciation. This is due to their long-lasting useful life and the fact that they are not expected to suffer material wear and tear or obsolescence over time. These assets are typically:
∙Held for long-term use
∙Maintained in a condition that preserves their functionality
∙Not subject to frequent technological changes
As a result, management has assessed that the useful economic life of these assets is indefinite or significantly extended, and therefore, no systematic depreciation charge is applied.
This policy is reviewed annually to ensure it remains appropriate and reflects the actual usage and condition of the assets.
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The net book value of land and buildings may be further analysed as follows:
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KNBY LND OP1 LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
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Food, beverage and stock of consumables
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The carrying value of stocks are stated net of impairment losses totalling £0 (2023 - £0). Impairment losses totalling £0 (2023 - £0) were recognised in profit and loss.
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Amounts owed by group undertakings
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Prepayments and accrued income
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Amounts owed by group undertakings are interest free and repayable on demand.
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Cash and cash equivalents
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KNBY LND OP1 LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
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Creditors: Amounts falling due within one year
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Amounts owed to group undertakings
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Other taxation and social security
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Accruals and deferred income
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Amounts owed to group undertakings are interest free and repayable on demand.
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Creditors: Amounts falling due after more than one year
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KNBY LND OP1 LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
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Analysis of the maturity of loans is given below:
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Amounts falling due within one year
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Amounts falling due 1-2 years
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Amounts falling due 2-5 years
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The bank facilities are secured by a fixed and floating charge on the Company's assets, and a composite guarantee provided by related entities.
The bank loan comprises a £1.6m term loan facility which is due for repayment on 27 May 2026. Interest is payable at a fixed annual rate of 7.8%.
Following a breach in covenants as at 30 June 2024, the loan was classified as a current liability as at the reporting date.
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Charged to other comprehensive income
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Allotted, called up and fully paid
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1 (2023 - 1) Ordinary share of £1.00
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KNBY LND OP1 LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
Profit and loss account
The profit and loss account represents the Company's cumulative profits net of dividends. This reserve is distributable.
The comparative information in these financial statements has been restated from the figures previously reported in the prior year financial statements as follows:
During the current year, the fair value of the Company's leasehold interest was revalued. This review identified that the asset had been overstated in the prior period and that its value had declined materially. This had the following impact on the comparative figures:
∙Reduction in the net book value of the leasehold from £2,564,904 to £288,871
∙Reduction in the deferred tax liability from £1,017,837 to £nil
∙A reversal of the £244,281 deferred tax charge which was previously charged to the revaluation reserve
∙The release of the remaining £773,556 deferred tax provision to the revaluation reserve
∙Reduction in the revaluation reserve from £3,053,511 to £nil
∙Increase in the Profit and loss account by £1,795,315 due to a transfer from the revaluation reserve
∙A net increase in Other Comprehensive Loss of £1,502,477 from £nil, resulting from the write down of the revaluation and the release of the previously recognised deferred tax liability
∙There was no impact on the profit for the previous year
∙An overall reduction in net assets of £1,258,196 from £5,579,741 to £4,321,545.
Prior year restatements
A prior year restatement was necessary due to items previously grouped under short-term leasehold properties and plant and machinery were reallocated into more appropriate categories, including computer equipment, fixtures and fittings, and other assets. This restatement did not affect the overall net book value of tangible fixed assets. Please refer to Note 13 for further details.
A second prior year restatement was necessary to reclassify pension costs of £46,408 from administrative expenses to cost of sales.
A third prior year restatement was necessary to reclassify intercompany recharges from cost of sales to other operating income. This restatement resulted in an increase of £120,389 in other operating income and an increase in cost of sales by the same amount.
These three prior year restatements had no impact on the previously reported net assets or profit.
The Company contributes to a defined contributions pension scheme. The assets of the scheme are held separately from those of the company in an independently administered fund. The pension cost charge represents contributions payable by the company to the fund and amounted to £57,382 (2023 - £43,511). Contributions totaling £5,936 (2023 - £21,578) were payable to the fund at the reporting date and included in creditors.
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KNBY LND OP1 LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
26.Guarantees
There is a fixed and floating charge on the Company's assets in respect of bank borrowings by a related company.
Subsequent to the year-end, the Company has entered into negotiations with its lenders regarding the refinancing of its existing debt facilities. As at the date of approval of the financial statements, these discussions are ongoing.
The immediate parent company is KNBY (UK) Limited, a company registered in England and Wales.
The ultimate parent undertaking is KNBY Limited, a company registered in the British Virgin Islands.
The directors regard L Shutov, a director of the company, as the ultimate controlling party.
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