REGISTERED NUMBER: 07110351 (England and Wales)

BLACK COUNTRY TRADITIONAL INNS LIMITED

STRATEGIC REPORT, REPORT OF THE DIRECTOR AND

FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2024

Page

Company Information

1

Strategic Report

2

Report of the Director

3

Report of the Independent Auditors

4

Statement of Income and Retained Earnings

7

Balance Sheet

8

Notes to the Financial Statements

9

DIRECTOR:

A McMeeking

REGISTERED OFFICE:

Sovereign House

12 Warwick Street

Coventry

West Midlands

CV5 6ET

REGISTERED NUMBER:

07110351 (England and Wales)

AUDITORS:

Burrows Scarborough Limited

(Statutory Auditor)

Sovereign House

12 Warwick Street

Coventry

CV5 6ET

The director presents his strategic report for the year ended 31 December 2024.

REVIEW OF BUSINESS

The company showed encouraging growth in revenue in 2024. Pleasingly profitability was maintained in spite of rising costs mainly through supplier price increases being passed on to retail price.

Sales have increased from £20.2m to £22.3m and gross margin has increased from 50.1% to 51.2%.

Net profit before tax has increased from £3.5m to £4.1m whilst net profit margin has increased from 17.3% to 18.4%.

At the balance sheet date, net assets had increased from £2.8m to £2.9m and cash balances had remained at £1.2m. Dividends of £3.0m were paid to the parent company in the year.

In 2024, the group has added 3 new pubs to its estate (White Hart, Malvern Pub and the Three Fishes) and has not sold any. It has also accelerated the paying down of some loan debts over the last year.

The parent company hopes to continue to slowly acquire individual public houses, as and when they become available.

The parent company hopes to extend some of the brewery to allow for increased brewing capacity for the years ahead.

Whilst the pub market remains challenging, the company hopes to continue to try to focus on providing old-fashioned "wet" pubs with real ales in order to mark it apart from many other pub operators.

PRINCIPAL RISKS AND UNCERTAINTIES

The company is exposed to the following principal risks and uncertainties:

1. Financing Costs: An increase in interest rates can result in higher financing costs for our business. This could lead to increased costs and reduced margins.

2. Consumer Demand: Higher interest rates can dampen consumer purchasing power, reduce the overall demand for discretionary spending and reduce sales.

3. Inflation: Higher inflation can increase our costs and we may not be able to pass these increases on to the consumer, so our margins may be reduced.

4. Cash Flow Management: Managing cash flow becomes more critical in a high-interest rate environment. Adequate liquidity is essential for day-to-day operations and to seize opportunities that may arise.

The company proactively monitors these risks and uncertainties, keeping close control over its sale prices, costs and margins. The company manages interest cost through robust treasury management.

ON BEHALF OF THE BOARD:

A McMeeking - Director

6 May 2025

The director presents his report with the financial statements of the company for the year ended 31 December 2024.

PRINCIPAL ACTIVITY

The principal activity of the company in the year under review was that of public house management.

DIVIDENDS

Interim dividends per share were paid as follows:

£1,000,000

- 31 July 2024

£500,000

- 31 December 2024

£1,500,000

The director recommends that no final dividend be paid.

The total distribution of dividends for the year ended 31 December 2024 will be £ 3,000,000 .

DIRECTOR

A McMeeking held office during the whole of the period from 1 January 2024 to the date of this report.

FINANCIAL INSTRUMENTS

All financial assets and liabilities in the financial statements are measured at amortised cost.

STATEMENT OF DIRECTOR'S RESPONSIBILITIES

The director is responsible for preparing the Strategic Report, the Report of the Director and the financial statements in accordance with applicable law and regulations.

Company law requires the director to prepare financial statements for each financial year. Under that law the director has 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 director must not approve the financial statements unless he is 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 director is required to:

-	select suitable accounting policies and then apply them consistently;

-	make judgements and accounting estimates that are reasonable and prudent;

-	prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.

The director is responsible for keeping adequate accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and enable him to ensure that the financial statements comply with the Companies Act 2006. He is also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS

So far as the director is aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and he has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the company's auditors are aware of that information.

AUDITORS

The auditors, Burrows Scarborough Limited, are deemed to be reappointed under section 487(2) of the Companies Act 2006.

ON BEHALF OF THE BOARD:

A McMeeking - Director

6 May 2025

Opinion

We have audited the financial statements of Black Country Traditional Inns Limited (the 'company') for the year ended 31 December 2024 which comprise the Statement of Income and Retained Earnings, Balance Sheet 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 company's affairs as at 31 December 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.

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 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 UK, including the FRC's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the 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 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 director with respect to going concern are described in the relevant sections of this report.

Other information

The director is responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Director, but does not include the financial statements and our Report of the Auditors 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.

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 this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

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

-	the information given in the Strategic Report and the Report of the Director for the financial year for which the financial statements are prepared is consistent with the financial statements; and

-	the Strategic Report and the Report of the Director have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Report of the Director.

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, 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 director's remuneration specified by law are not made; or

-	we have not received all the information and explanations we require for our audit.

Responsibilities of director

As explained more fully in the Statement of Director's Responsibilities set out on page three, the director is 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 director determines 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 director is 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 director either intends to liquidate the company or to cease operations, or has no realistic alternative but to do so.

Auditors' 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 a Report of the Auditors that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

It is the primary responsibility of management, with the oversight of those charged with governance, to ensure that the company's operations are conducted in accordance with the provisions of laws and regulations and for the prevention and detection of fraud.

In identifying and assessing risks of material misstatement in respect of irregularities, including fraud, the audit engagement team:

- obtained an understanding of the nature of the industry and sector, including the legal and regulatory frameworks that the company operates in and how the company is complying with the legal and regulatory frameworks;

- enquired of management, and those charged with governance, about their own identification and assessment of the risks of irregularities, including any known actual, suspected or alleged instances of fraud;

- discussed matters about non-compliance with laws and regulations and how fraud might occur including assessment of how and where the financial statements may be susceptible to fraud.

As a result of these procedures we consider the most significant laws and regulations that have a direct impact on the financial statements are the health and safety legislation, FRS 102, the Companies Act 2006 and tax law. We performed audit procedures to detect non-compliance which may have a material impact on the financial statements, which included:

- Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations.

- Auditing the risk of management override of controls, including through testing journal entries and other adjustments for appropriateness, evaluating the business rationale in relation to significant, unusual transactions and transactions entered into outside the normal course of business and assessing whether the judgements made in making accounting estimates are indicative of potential bias.

- Enquiring of management around actual and potential litigation and claims, including health and safety.

- Enquiring of company's staff in tax and compliance functions to identify any instances of non-compliance with laws and regulations.

- Reviewing minutes of meetings of management.

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

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

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 a Report of the Auditors 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.

Nicholas Burrows BA FCA (Senior Statutory Auditor)

for and on behalf of Burrows Scarborough Limited

(Statutory Auditor)

Sovereign House

12 Warwick Street

Coventry

CV5 6ET

6 May 2025

TURNOVER

3

22,322,714

20,176,016

Cost of sales

10,884,009

10,065,344

GROSS PROFIT

11,438,705

10,110,672

Administrative expenses

7,566,829

6,853,572

3,871,876

3,257,100

Other operating income

230,138

238,802

OPERATING PROFIT

5

4,102,014

3,495,902

Interest receivable and similar income

640

-

4,102,654

3,495,902

Interest payable and similar expenses

6

3,146

2,263

PROFIT BEFORE TAXATION

4,099,508

3,493,639

Tax on profit

7

1,035,109

779,559

PROFIT FOR THE FINANCIAL YEAR

3,064,399

2,714,080

Retained earnings at beginning of year

2,824,434

2,110,354

Dividends

8

(3,000,000

)

(2,000,000

)

RETAINED EARNINGS AT END OF YEAR

2,888,833

2,824,434

FIXED ASSETS

Tangible assets

9

3,535,579

3,322,323

CURRENT ASSETS

Stocks

10

650,131

582,570

Debtors

11

274,789

535,395

Prepayments and accrued income

147,398

128,982

Cash at bank and in hand

1,215,736

1,215,171

2,288,054

2,462,118

CREDITORS

Amounts falling due within one year

12

2,034,349

2,033,319

NET CURRENT ASSETS

253,705

428,799

TOTAL ASSETS LESS CURRENT LIABILITIES

3,789,284

3,751,122

PROVISIONS FOR LIABILITIES

14

(571,938

)

(537,819

)

ACCRUALS AND DEFERRED INCOME

15

(328,511

)

(388,867

)

NET ASSETS

2,888,835

2,824,436

CAPITAL AND RESERVES

Called up share capital

16

2

2

Retained earnings

17

2,888,833

2,824,434

SHAREHOLDERS' FUNDS

2,888,835

2,824,436

The financial statements were approved by the director and authorised for issue on 6 May 2025 and were signed by:

A McMeeking - Director

1.	STATUTORY INFORMATION

Black Country Traditional Inns Limited is a private company, limited by shares , registered in England and Wales. The company's registered number and registered office address can be found on the Company Information page.

The company's head office is located at 69 Third Avenue, Pensnett Trading Estate, Kingswinford, West Midlands, DY6 7FD.

The financial statements are presented in sterling which is the functional currency of the company and rounded to the nearest £.

The significant accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all years presented unless otherwise stated.

2.	ACCOUNTING POLICIES

Basis of preparing the financial statements

The financial statements have been prepared in accordance with applicable accounting standards including Financial Reporting Standard 102 The Financial Reporting Standard Applicable in the UK and Republic of Ireland (FRS 102) and the Companies Act 2006. The financial statements have been prepared on a going concern basis under the historical cost convention, modified as necessary to include certain items at fair value.

Financial Reporting Standard 102 - reduced disclosure exemptions

The company has taken advantage of the following disclosure exemption in preparing these financial statements, as permitted by FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":

•

the requirements of Section 7 Statement of Cash Flows.

Critical accounting judgements and key sources of estimation uncertainty

Many of the amounts included in the financial statements involve the use of judgement and/or estimation. These judgements and estimates are based on management's best knowledge of the relevant facts and circumstances, having regard to prior experience, but actual results may differ from the amounts included in the financial statements. Information about such judgements and estimation is contained in these accounting policies and/or the notes to the financial statements and the key areas are summarised below:

Judgements in applying accounting policies

There are no judgements (apart from those involving estimates) that have been made in the process of applying these accounting policies that have had a significant effect on amounts recognised in the financial statements.

Sources of estimation uncertainty

Depreciation rates are based on estimates of the useful lives and residual values of the assets involved (see the Tangible fixed assets accounting policy).

Turnover

Turnover from the sale of bar purchases is recognised when significant risks and rewards of ownership of the goods have transferred to the buyer, the amount of turnover can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the company and the costs incurred or to be incurred in respect of the transaction can be measured reliably. This is usually on point of sale.

Income from accommodation sales is recognised at the same time as the customers' stay.

Tangible fixed assets

The company initially recognises fixed assets at cost.

The company is not responsible for the property improvements on the properties it leases from it's parent company. These improvement costs, if initially suffered by the company, are subsequently recharged to the parent company at cost. The company is, however, responsible for property improvement costs on properties it leases from other third parties outside the group.

Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life:

Long leasehold

- over the period of the lease, 10% on cost

Plant & machinery

- 25% on reducing balance

Fixtures & fittings

- 25% on reducing balance

Motor vehicles

- 25% on reducing balance

Computer equipment

- 33% on cost

Improvements to property

- straight line over 5 years for minor refurbishments, straight line over 7 years for major refurbishments or over the lease term if this is shorter

Stocks

Stocks are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items.

Taxation

Taxation for the year comprises current and deferred tax. Tax is recognised in the Statement of Comprehensive Income, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

Deferred tax

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date.

Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference.

Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

Hire purchase and leasing commitments

Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the lease.

Pension costs and other post-retirement benefits

The company operates a defined contribution pension scheme. Contributions payable to the company's pension scheme are charged to profit or loss in the period to which they relate.

3.

TURNOVER

The turnover and profit before taxation are attributable to the one principal activity of the company.

An analysis of turnover by geographical market is given below:

2024

2023

£

£

United Kingdom

22,322,714

20,176,016

22,322,714

20,176,016

4.	EMPLOYEES AND DIRECTORS

2024

2023

£

£

Wages and salaries

812,498

788,828

Social security costs

79,311

80,076

Other pension costs

103,968

83,717

995,777

952,621

The average number of employees during the year was as follows:

2024

2023

Directors

1

1

Management

4

4

Production

7

7

Administration

11

10

23

22

2024

2023

£

£

Director's remuneration

12,570

12,576

5.	OPERATING PROFIT

The operating profit is stated after charging:

2024

2023

£

£

Hire of plant and machinery

51,486

38,637

Depreciation - owned assets

887,909

878,982

Auditors' remuneration

20,000

20,000

6.

INTEREST PAYABLE AND SIMILAR EXPENSES

2024

2023

£

£

Other interest

3,146

2,263

7.

TAXATION

Analysis of the tax charge

The tax charge on the profit for the year was as follows:

2024

2023

£

£

Current tax:

UK corporation tax

1,010,880

784,914

Prior period tax adjustment

(9,890

)

-

Total current tax

1,000,990

784,914

Deferred tax

34,119

(5,355

)

Tax on profit

1,035,109

779,559

UK corporation tax has been charged at 25% (2023 - 23.52%).

Reconciliation of total tax charge included in profit and loss

The tax assessed for the year is higher than the standard rate of corporation tax in the UK. The difference is explained below:

2024

2023

£

£

Profit before tax

4,099,508

3,493,639

Profit multiplied by the standard rate of corporation tax in the UK of 25% (2023 - 23.520%)

1,024,877

821,704

Effects of:

Expenses not deductible for tax purposes

3,174

276

Adjustments to tax charge in respect of previous periods

(9,890

)

(41,080

)

Depreciation on non-tax deductible long leasehold assets

239

225

Effect of enhanced tax allowances

-

(3,494

)

Other

16,709

1,928

Total tax charge

1,035,109

779,559

The deferred tax debit of £34,119 relates to deferred tax movement as follows:

2024

£

Accelerated tax allowances

32,988

Structures and buildings allowances

(8,869

)

Pension payment timing differences

10,000

Total

34,119

Deferred tax is included in the balance sheet is as follows:

2024

2023

£

£

Accelerated tax allowances

659,552

626,564

Structures and buildings allowances

(77,614

)

(68,745

)

Pension payment timing differences

(10,000

)

20,000

Total

571,938

537,819

The expectation is that the following deferred tax balances will reverse in the next financial year. For accelerated tax allowances and structures and buildings allowances, this relates to the tax on depreciation that will be charged in excess of tax allowances to be claimed in the year to 31st December 2025 on the specific assets on the balance sheet at 31st December 2024 that are eligible for tax allowances. For pension payment timing differences, this relates to the tax deduction expected to be due following payment of pension accruals:

2025

£

Accelerated tax allowances - reduction in liability

171,987

Structures and buildings allowances - reduction in liability

38,467

Pension payment timing differences - no change

-

Total - reduction in liability expected in 2025

210,454

8.

DIVIDENDS

2024

2023

£

£

Ordinary shares of £1.00 each

Interim

3,000,000

2,000,000

9.	TANGIBLE FIXED ASSETS

Improvements

Long

to

Plant and

leasehold

property

machinery

£

£

£

COST

At 1 January 2024

9,557

1,006,334

907,697

Additions

-

261,771

180,388

At 31 December 2024

9,557

1,268,105

1,088,085

DEPRECIATION

At 1 January 2024

5,780

498,326

532,391

Charge for year

955

125,374

113,390

At 31 December 2024

6,735

623,700

645,781

NET BOOK VALUE

At 31 December 2024

2,822

644,405

442,304

At 31 December 2023

3,777

508,008

375,306

Fixtures

and

Motor

Computer

fittings

vehicles

equipment

Totals

£

£

£

£

COST

At 1 January 2024

4,750,892

15,262

40,544

6,730,286

Additions

645,136

-

13,870

1,101,165

At 31 December 2024

5,396,028

15,262

54,414

7,831,451

DEPRECIATION

At 1 January 2024

2,342,452

8,593

20,421

3,407,963

Charge for year

634,128

1,667

12,395

887,909

At 31 December 2024

2,976,580

10,260

32,816

4,295,872

NET BOOK VALUE

At 31 December 2024

2,419,448

5,002

21,598

3,535,579

At 31 December 2023

2,408,440

6,669

20,123

3,322,323

10.

STOCKS

2024

2023

£

£

Stocks

650,131

582,570

The replacement cost of stocks is not materially different from the value stated above.

11.

DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

2024

2023

£

£

Trade debtors

68,574

57,113

Amounts owed by group undertakings

-

349,935

Other debtors

206,215

128,347

274,789

535,395

12.

CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

2024

2023

£

£

Trade creditors

616,281

822,775

Amounts owed to group undertakings

420,981

-

Tax

480,187

455,914

Social security and other taxes

18,594

49,669

VAT

425,919

642,536

Other creditors

72,387

62,425

2,034,349

2,033,319

13.	LEASING AGREEMENTS

Minimum lease payments under non-cancellable operating leases fall due as follows:

2024

2023

£

£

Within one year

38,000

38,000

Between one and five years

152,000

152,000

In more than five years

478,167

516,167

668,167

706,167

14.	PROVISIONS FOR LIABILITIES

2024

2023

£

£

Deferred tax

571,938

537,819

Deferred

tax

£

Balance at 1 January 2024

537,819

Provided during year

34,119

Balance at 31 December 2024

571,938

Deferred tax consists of:

2024

2023

£

£

Accelerated tax allowances

659,552

626,564

Structure and buildings allowances

(77,614

)

(68,745

)

Pension payment timing differences

(10,000

)

(20,000

)

Total

571,938

537,819

15.	ACCRUALS AND DEFERRED INCOME

2024

2023

£

£

Accruals and deferred income

328,511

388,867

16.	CALLED UP SHARE CAPITAL

Allotted, issued and fully paid:

Number:

Class:

Nominal

2024

2023

value:

£

£

2

Ordinary

£1.00

2

2