Michels Ventures 2 Limited Group accounts (Group and Company)

COMPANY REGISTRATION NUMBER: 10798692

Michels Ventures 2 Limited

Consolidated Financial Statements

31 December 2024

Michels Ventures 2 Limited

Financial Statements

Year ended 31 December 2024

Contents	Page

Officers and professional advisers	1

Strategic report	2

Director's report	3

Independent auditor's report to the member	5

Consolidated statement of income and retained earnings	9

Company statement of income and retained earnings	10

Consolidated statement of financial position	11

Company statement of financial position	12

Consolidated statement of cash flows	13

Notes to the financial statements	14

Michels Ventures 2 Limited

Officers and Professional Advisers

Director	Sir David Michels

Company secretary	Ian Noble

Registered office	2nd Floor, 32-33 Gosfield Street
	Fitzrovia
	London
	W1W 6HL

Auditor	Baker Friend Audit Limited
	Chartered accountants & statutory auditor
	2nd Floor
	32-33 Gosfield Street
	Fitzrovia
	London
	W1W 6HL

Michels Ventures 2 Limited

Strategic Report

Year ended 31 December 2024

PRINCIPAL ACTIVITIES AND BUSINESS REVIEW The principal activity of the company during the period was the ownership of RSM Leisure Limited, which in turn owns two hotels through its subsidiaries (The Lea Marston Hotel and Leisure Complex and The Abbey Hotel Golf and Country Club). The consolidated group financial statements include the RSM Leisure Limited group. RESULTS AND DIVIDENDS The loss for the period, after taxation, amounted to £347,374 (2023- £331,062). The director does not recommend a dividend. PRINCIPAL RISKS AND UNCERTAINTIES The hotel industry has taken time to recover since the pandemic. However, costs have risen especially payroll and energy costs. The change of government whilst having little or no effect on the current year to 31 December 2024, the planned increase in employers NI may impact profits and turnover in 2025/2026.

This report was approved by the board of directors on 25 September 2025 and signed on behalf of the board by:

Sir David Michels
Director

Registered office:

2nd Floor, 32-33 Gosfield Street

Fitzrovia

London

W1W 6HL

Michels Ventures 2 Limited

Director's Report

Year ended 31 December 2024

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

Director

The director who served the company during the year was as follows:

Sir David Michels

Dividends

The director does not recommend payment of a dividend.

Future developments

The hotels continue to perform well and in line with projections. There is no major refurbishment planned apart from normal repairs and renewals.

Employment of disabled persons

The Group is committed to an active equal opportunities policy from recruitment and selection through training and development performance reviews and promotion to retirement. It is our policy to promote an environment free from discrimination, harassment and victimisation where everyone will receive equal treatment regardless of gender, colour, ethnic or national origin, disability, age, marital status, sexual orientation or religion. We are an organisation which uses everyone's talents and abilities and where diversity is valued. It is our policy that people with disabilities should have fall and fair consideration for all vacancies. We actively retrain and adjust their environment where possible to allow them to maximise their potential.

Employee involvement

We remain committed to employee involvement throughout the business. Employees are kept well informed of the performance and strategy of the Group through briefings, regular meetings and email.

Financial instruments

The company uses various financial instruments. These include loans from shareholders, bank loans and various items, such as trade debtors and trade creditors, which arise directly from its operations. The main purpose of these financial instruments is to raise finance for the company's operations and to fund extensive refurbishments to the hotel.

The existence of these financial instruments exposes the company to a number of financial risks, the principal ones of which are liquidity risk and credit risk.

Events after the end of the reporting period

The Sale of land at The Abbey Hotel completed in 2021 subject to planning hasfinalised in July 2025.

Director's responsibilities statement

The director is responsible for preparing the strategic report, director's report 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 group and the company and the profit or loss of the group for that period. In preparing these financial statements, the director is required to: - select suitable accounting policies 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 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 them 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. Auditor

Each of the persons who is a director at the date of approval of this report confirms that:

- so far as they are aware, there is no relevant audit information of which the group and the company's auditor is unaware; and - they have taken all steps that they ought to have taken as a director to make themselves aware of any relevant audit information and to establish that the group and the company's auditor is aware of that information. The auditor is deemed to have been re-appointed in accordance with section 487 of the Companies Act 2006.

This report was approved by the board of directors on 25 September 2025 and signed on behalf of the board by:

Sir David Michels
Director

Registered office:

2nd Floor, 32-33 Gosfield Street

Fitzrovia

London

W1W 6HL

Michels Ventures 2 Limited

Independent Auditor's Report to the Member of Michels Ventures 2 Limited

Year ended 31 December 2024

Opinion

We have audited the financial statements of Michels Ventures 2 Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2024 which comprise the consolidated statement of income and retained earnings, company statement of income and retained earnings, consolidated statement of financial position, company statement of financial position, consolidated statement of cash flows 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 FRS 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 of the parent company's affairs as at 31 December 2024 and of the group's loss for the year then ended; - have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; - have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the 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.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

Our evaluation of the directors' assessment of the entity's ability to continue to adopt the going concern basis of accounting included the review of the forecast for the next 5 years.

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 entity's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorized 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 other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. The director is responsible for the other information. 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 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.

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 director's report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

- the strategic report and the director's report have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the group and the parent company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the director's 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, 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 the 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; and - the directors were not entitled to prepare the financial statements in accordance with the small companies regime and take advantage of the small companies exemption in preparing the directors reports and take advantage of the small companies exemption from the requirement to prepare a strategic report.

Responsibilities of the director

As explained more fully in the director's responsibilities statement, 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 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 director is responsible for assessing the group's and the parent 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 group or the parent company or to cease operations, or has no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below: Owing to the inherent limitations of an audit, there is an unavoidable risk that material misstatements may not be detected, even though the audit is properly planned and performed in accordance with the ISAs (UK) Based on our understanding of the Group and industry, we identified that the principal risks of non-compliance with laws and regulations related to pensions legislation, UK and other relevant tax legislation, and we considered the extent to which non-compliance might have a material effect on the financial statements. We also considered those laws and regulations that have a direct impact on the financial statements such as the Companies Act 2006. We evaluated management's incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls), and determined that the principal risks were related to posting inappropriate journal entries to manipulate financial results and management bias in accounting estimates. Audit procedures performed by the Audit team and / or component auditors included: o Discussions with management, legal counsel and the internal audit function, including consideration of unknown or suspected instances of non-compliance with laws and regulations and fraud: o Challenging assumptions made by management in its significant accounting estimates in particular in relation to estimation of the cashflow projections used to value the fixed assets and uncertain tax provisions; and o Identifying and testing higher risk journal entries, in particular any journal entries posted with unusual account combinations, journals posted by senior management There are inherent limitations in the audit procedures described above and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting on resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collision. A further description of our responsibilities is located 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 member, 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 member 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 member as a body, for our audit work, for this report, or for the opinions we have formed.

Jeffrey Baker

(Senior Statutory Auditor)

For and on behalf of

Baker Friend Audit Limited

Chartered accountants & statutory auditor

2nd Floor

32-33 Gosfield Street

Fitzrovia

London

W1W 6HL

25 September 2025

Michels Ventures 2 Limited

Consolidated Statement of Income and Retained Earnings

Year ended 31 December 2024

		2024	2023
Note		£	£
Turnover	4	11,468,355	11,500,973

Cost of sales	1,210,828	1,275,495
	-------------	-------------
Gross profit	10,257,527	10,225,478

Administrative expenses		9,201,191	9,492,449
		-------------	-------------
Operating profit	5	1,056,336	733,029

Other interest receivable and similar income		–	120
Interest payable and similar expenses	8	1,059,644	1,097,361
		-------------	-------------
Loss before taxation		( 3,308)	( 364,212)

Tax on loss	9	344,066	31,819
		---------	---------
Loss for the financial year and total comprehensive income		( 347,374)	( 396,031)
		---------	---------

Retained losses at the start of the year	( 3,046,221)	( 2,650,190)
	------------	------------
Retained losses at the end of the year	( 3,393,595)	( 3,046,221)
	------------	------------

All the activities of the group are from continuing operations.

Michels Ventures 2 Limited

Company Statement of Income and Retained Earnings

Year ended 31 December 2024

	2024	2023
Note	£	£
Loss for the financial year and total comprehensive income	( 815,168)	( 1,159,563)
Retained losses at the start of the year	( 4,094,201)	( 2,934,638)
	------------	------------
Retained losses at the end of the year	( 4,909,369)	( 4,094,201)
	------------	------------

Michels Ventures 2 Limited

Consolidated Statement of Financial Position

31 December 2024

	2024	2023
Note	£	£

Fixed assets

Intangible assets	10	883,793	1,205,172
Tangible assets	11	13,812,929	13,981,440
		-------------	-------------
		14,696,722	15,186,612

Current assets

Stocks	13	132,808	114,119
Debtors	14	474,464	628,196
Cash at bank and in hand		876,649	1,803,608
		------------	------------
		1,483,921	2,545,923

Creditors: amounts falling due within one year	15	2,447,844	3,269,747
		------------	------------
Net current liabilities		963,923	723,824
		-------------	-------------
Total assets less current liabilities		13,732,799	14,462,788

Creditors: amounts falling due after more than one year	16	16,818,041	17,174,099

Provisions	18	308,253	334,810
		-------------	-------------
Net liabilities		( 3,393,495)	( 3,046,121)
		-------------	-------------

Capital and reserves

Called up share capital	21	100	100
Profit and loss account		( 3,393,595)	( 3,046,221)
		------------	------------
Shareholder deficit		( 3,393,495)	( 3,046,121)
		------------	------------

These financial statements were approved by the board of directors and authorised for issue on 25 September 2025 , and are signed on behalf of the board by:

Sir David Michels
Director

Company registration number: 10798692

Michels Ventures 2 Limited

Company Statement of Financial Position

31 December 2024

	2024	2023
Note	£	£

Fixed assets

Investments	12	11,740,447	11,740,447

Current assets

Debtors	14	7,092,587	6,620,342
Cash at bank and in hand		6,888	–
		------------	------------
		7,099,475	6,620,342

Creditors: amounts falling due within one year	15	1,028,602	1,526,460
		------------	------------
Net current assets		6,070,873	5,093,882
		-------------	-------------
Total assets less current liabilities		17,811,320	16,834,329

Creditors: amounts falling due after more than one year	16	22,720,589	20,928,430
		-------------	-------------
Net liabilities		( 4,909,269)	( 4,094,101)
		-------------	-------------

Capital and reserves

Called up share capital	21	100	100
Profit and loss account		( 4,909,369)	( 4,094,201)
		------------	------------
Shareholder deficit		( 4,909,269)	( 4,094,101)
		------------	------------

The loss for the financial year of the parent company was £ 815,168 (2023: £ 1,159,563 ).

These financial statements were approved by the board of directors and authorised for issue on 25 September 2025 , and are signed on behalf of the board by:

Sir David Michels
Director

Company registration number: 10798692

Michels Ventures 2 Limited

Consolidated Statement of Cash Flows

Year ended 31 December 2024

	2024	2023
	£	£

Cash flows from operating activities

Loss for the financial year	( 347,374)	( 396,031)

Adjustments for:
Depreciation of tangible assets	217,282	279,606
Amortisation of intangible assets	321,379	321,379
Other interest receivable and similar income	–	(120)
Interest payable and similar expenses	1,059,644	1,097,361
Tax on loss	344,066	31,819
Accrued expenses	202,556	151,964

Changes in:
Stocks	( 18,689)	( 8,352)
Trade and other debtors	153,732	( 371,605)
Trade and other creditors	( 229,006)	891,555
	------------	------------
Cash generated from operations	1,703,590	1,997,576

Interest paid	( 1,059,644)	( 841,263)
Interest received	–	120
Tax paid	( 434,152)	–
	------------	------------
Net cash from operating activities	209,794	1,156,433
	------------	------------

Cash flows from investing activities

Purchase of tangible assets	( 245,487)	( 132,124)
Proceeds from sale of tangible assets	196,716	–
	------------	------------
Net cash used in investing activities	( 48,771)	( 132,124)
	------------	------------

Cash flows from financing activities

Proceeds from borrowings	325,934	–
Proceeds from loans from group undertakings	18,744	–
Repayments of loans from group undertakings	( 1,414,860)	( 4,114,720)
Payments of finance lease liabilities	( 17,800)	1,030
	------------	------------
Net cash used in financing activities	( 1,087,982)	( 4,113,690)
	------------	------------

Net decrease in cash and cash equivalents	( 926,959)	( 3,089,381)
Cash and cash equivalents at beginning of year	1,803,608	4,892,989
	------------	------------
Cash and cash equivalents at end of year	876,649	1,803,608
	------------	------------

Michels Ventures 2 Limited

Notes to the Financial Statements

Year ended 31 December 2024

1. General information

The company is a private company limited by shares, registered in England & Wales. The address of the registered office is 2nd Floor, 32-33 Gosfield Street, London W1W 6HL. These financial statements cover a 12 month period to 31 December 2024.

2. Statement of compliance

These financial statements have been prepared in compliance with FRS 102, 'The Financial Reporting Standard applicable in the UK and the Republic of Ireland'.

3. Accounting policies

Basis of preparation

The financial statements have been prepared on the historical cost basis, as modified by the revaluation of certain financial assets and liabilities and investment properties measured at fair value through profit or loss.

The financial statements are prepared in sterling, which is the functional currency of the entity.

Going concern

In preparing the financial statements, the directors are required to make an assessment of the ability of the group and the company to continue as a going concern. The directors have prepared a cash flow forecast for the group and company which covers 12 months period from the date of signing these financial statement. The directors have concluded that it remains appropriate to adopt a going concern basis of preparation in these financial statements.

Disclosure exemptions

The parent company satisfies the criteria of being a qualifying entity as defined in FRS 102. As such, advantage has been taken of the following reduced disclosures available under FRS 102:

(a) Disclosures in respect of each class of share capital have not been presented.

(b) No cash flow statement has been presented for the company.

(c) Disclosures in respect of financial instruments have not been presented.

(d) No disclosure has been given for the aggregate remuneration of key management personnel.

Consolidation

The financial statements consolidate the financial statements of the Group and all of its subsidiary undertakings. The results of subsidiaries acquired or disposed of during the year are included from or to the date that control passes. The parent company has applied the exemption contained in section 408 of the Companies Act 2006 and has not included its individual statement of comprehensive income.

Judgements and key sources of estimation uncertainty

In the application of the Company's accounting policies, the Directors are required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods. Estimated useful lives and residual values of fixed assets Depreciation of tangible and intangible fixed assets has been based on estimated useful lives and residual values deemed appropriate by the Directors. Estimated useful lives and residual values are reviewed annually and will be revised as appropriate. The Directors also paid a particular attention to the value of the fixed assets in the accounts and believe, based on their projections that there is no need for any impairment as of 31 December 2024.

Revenue recognition

Turnover is measured at the fair value of the consideration received or receivable for goods supplied and services rendered, net of discounts and Value Added Tax. Revenue from the sale of goods is recognised when the significant risks and rewards of ownership have transferred to the buyer (usually on despatch of the goods); the amount of revenue can be measured reliably; it is probable that the associated economic benefits will flow to the entity; and the costs incurred or to be incurred in respect of the transactions can be measured reliably. Revenue from hotel operations is recognised when rooms are occupied and when food and beverages are sold.

Income tax

The taxation expense represents the aggregate amount of current and deferred tax recognised in the reporting period. Tax is recognised in profit or loss, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, tax is recognised in other comprehensive income or directly in equity, respectively. Current tax is recognised on taxable profit for the current and past periods. Current tax is measured at the amounts of tax expected to pay or recover using the tax rates and laws that have been enacted or substantively enacted at the reporting date.

Deferred tax is recognised in respect of all timing differences at the reporting date. Unrelieved tax losses and other deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date that are expected to apply to the reversal of the timing difference.

Goodwill

Goodwill arises on business acquisitions and represents the excess of the cost of the acquisition over the company's interest in the net amount of the identifiable assets, liabilities and contingent liabilities of the acquired business. Goodwill is measured at cost less accumulated amortisation and accumulated impairment losses. It is amortised on a straight-line basis over its useful life. Where a reliable estimate of the useful life of goodwill or intangible assets cannot be made, the life is presumed not to exceed ten years.

Amortisation

Amortisation is calculated so as to write off the cost of an asset, less its estimated residual value, over the useful life of that asset as follows:

	Goodwill	-	10% straight line

If there is an indication that there has been a significant change in amortisation rate, useful life or residual value of an intangible asset, the amortisation is revised prospectively to reflect the new estimates.

Tangible assets

Tangible assets are initially recorded at cost, and subsequently stated at cost less any accumulated depreciation and impairment losses. Any tangible assets carried at revalued amounts are recorded at the fair value at the date of revaluation less any subsequent accumulated depreciation and subsequent accumulated impairment losses. An increase in the carrying amount of an asset as a result of a revaluation, is recognised in other comprehensive income and accumulated in equity, except to the extent it reverses a revaluation decrease of the same asset previously recognised in profit or loss. A decrease in the carrying amount of an asset as a result of revaluation, is recognised in other comprehensive income to the extent of any previously recognised revaluation increase accumulated in equity in respect of that asset. Where a revaluation decrease exceeds the accumulated revaluation gains accumulated in equity in respect of that asset, the excess shall be recognised in profit or loss.

Depreciation

Depreciation is calculated so as to write off the cost or valuation of an asset, less its residual value, over the useful economic life of that asset as follows:

	Equipment	-	10%-33% reducing balance

Investments

Fixed asset investments are initially recorded at cost, and subsequently stated at cost less any accumulated impairment losses.

Listed investments are measured at fair value with changes in fair value being recognised in profit or loss.

Impairment of fixed assets

A review for indicators of impairment is carried out at each reporting date, with the recoverable amount being estimated where such indicators exist. Where the carrying value exceeds the recoverable amount, the asset is impaired accordingly. Prior impairments are also reviewed for possible reversal at each reporting date. For the purposes of impairment testing, when it is not possible to estimate the recoverable amount of an individual asset, an estimate is made of the recoverable amount of the cash-generating unit to which the asset belongs. The cash-generating unit is the smallest identifiable group of assets that includes the asset and generates cash inflows that largely independent of the cash inflows from other assets or groups of assets. For impairment testing of goodwill, the goodwill acquired in a business combination is, from the acquisition date, allocated to each of the cash-generating units that are expected to benefit from the synergies of the combination, irrespective of whether other assets or liabilities of the company are assigned to those units.

Stocks

Stocks are measured at the lower of cost and estimated selling price less costs to complete and sell. Cost includes all costs of purchase, costs of conversion and other costs incurred in bringing the stock to its present location and condition.

Finance leases and hire purchase contracts

Assets held under finance leases and hire purchase contracts are recognised in the statement of financial position as assets and liabilities at the lower of the fair value of the assets and the present value of the minimum lease payments, which is determined at the inception of the lease term. Any initial direct costs of the lease are added to the amount recognised as an asset. Lease payments are apportioned between the finance charges and reduction of the outstanding lease liability using the effective interest method. Finance charges are allocated to each period so as to produce a constant rate of interest on the remaining balance of the liability.

Provisions

Provisions are recognised when the entity has an obligation at the reporting date as a result of a past event, it is probable that the entity will be required to transfer economic benefits in settlement and the amount of the obligation can be estimated reliably. Provisions are recognised as a liability in the statement of financial position and the amount of the provision as an expense. Provisions are initially measured at the best estimate of the amount required to settle the obligation at the reporting date and subsequently reviewed at each reporting date and adjusted to reflect the current best estimate of the amount that would be required to settle the obligation. Any adjustments to the amounts previously recognised are recognised in profit or loss unless the provision was originally recognised as part of the cost of an asset. When a provision is measured at the present value of the amount expected to be required to settle the obligation, the unwinding of the discount is recognised as a finance cost in profit or loss in the period it arises.

Financial instruments

A financial asset or a financial liability is recognised only when the company becomes a party to the contractual provisions of the instrument. Basic financial instruments are initially recognised at the transaction price, unless the arrangement constitutes a financing transaction, where it is recognised at the present value of the future payments discounted at a market rate of interest for a similar debt instrument. Debt instruments are subsequently measured at amortised cost. Where investments in non-convertible preference shares and non-puttable ordinary shares or preference shares are publicly traded or their fair value can otherwise be measured reliably, the investment is subsequently measured at fair value with changes in fair value recognised in profit or loss. All other such investments are subsequently measured at cost less impairment. Other financial instruments, including derivatives, are initially recognised at fair value, unless payment for an asset is deferred beyond normal business terms or financed at a rate of interest that is not a market rate, in which case the asset is measured at the present value of the future payments discounted at a market rate of interest for a similar debt instrument. Other financial instruments are subsequently measured at fair value, with any changes recognised in profit or loss, with the exception of hedging instruments in a designated hedging relationship.

Financial assets that are measured at cost or amortised cost are reviewed for objective evidence of impairment at the end of each reporting date. If there is objective evidence of impairment, an impairment loss is recognised in profit or loss immediately. For all equity instruments regardless of significance, and other financial assets that are individually significant, these are assessed individually for impairment. Other financial assets are either assessed individually or grouped on the basis of similar credit risk characteristics. Any reversals of impairment are recognised in profit or loss immediately, to the extent that the reversal does not result in a carrying amount of the financial asset that exceeds what the carrying amount would have been had the impairment not previously been recognised.

Defined contribution plans

Contributions to defined contribution plans are recognised as an expense in the period in which the related service is provided. Prepaid contributions are recognised as an asset to the extent that the prepayment will lead to a reduction in future payments or a cash refund. When contributions are not expected to be settled wholly within 12 months of the end of the reporting date in which the employees render the related service, the liability is measured on a discounted present value basis. The unwinding of the discount is recognised as a finance cost in profit or loss in the period in which it arises.

4. Turnover

Turnover arises from:

	2024	2023
	£	£
Hotel operations	11,468,355	11,500,973
	-------------	-------------

The whole of the turnover is attributable to the principal activity of the group wholly undertaken in the United Kingdom.

5. Operating loss

Operating profit or loss is stated after charging:

	2024	2023
	£	£
Amortisation of intangible assets	321,379	321,379
Depreciation of tangible assets	217,282	279,606
Impairment of trade debtors	196,716	–
	---------	---------

6. Auditor's remuneration

	2024	2023
	£	£
Fees payable for the audit of the financial statements	50,000	50,000
	--------	--------

7. Staff costs

The average number of persons employed by the group during the year, including the director, amounted to:

	2024	2023
	No.	No.
Number of hotel staff	258	258
	----	----

The aggregate payroll costs incurred during the year, relating to the above, were:

	2024	2023
	£	£
Wages and salaries	4,440,503	4,423,276
Social security costs	142,745	260,927
Other pension costs	62,455	58,138
	------------	------------
	4,645,703	4,742,341
	------------	------------

8. Interest payable and similar expenses

	2024	2023
	£	£
Interest on debenture loans	70,637	211,138
Interest on banks loans and overdrafts	989,007	886,223
	------------	------------
	1,059,644	1,097,361
	------------	------------

9. Tax on loss

Major components of tax expense

	2024	2023
	£	£

Current tax:

UK current tax income	125,018	–
Adjustments in respect of prior periods	263,264	( 435)
	---------	----
Total current tax	388,282	( 435)
	---------	----

Deferred tax:

Origination and reversal of timing differences	( 44,216)	32,254
	---------	--------
Tax on loss	344,066	31,819
	---------	--------

Reconciliation of tax expense

The tax assessed on the loss on ordinary activities for the year is higher than (2023: higher than) the standard rate of corporation tax in the UK of 50 % (2023: 23.50 %).

	2024	2023
	£	£
Loss on ordinary activities before taxation	( 3,308)	( 364,212)
	-------	---------
Loss on ordinary activities by rate of tax	( 828)	( 60,517)
Adjustment to tax charge in respect of prior periods	261,065	(23,582)
Effect of expenses not deductible for tax purposes	87,231	84,590
Effect of capital allowances and depreciation	( 3,402)	–
Effect of different UK tax rates on some earnings	–	14,898
Utilisation of tax losses	–	16,430
	---------	---------
Tax on loss	344,066	31,819
	---------	---------

10. Intangible assets

Group	Goodwill
	£
Cost
At 1 January 2024 and 31 December 2024	3,213,791
	------------
Amortisation
At 1 January 2024	2,008,619
Charge for the year	321,379
	------------
At 31 December 2024	2,329,998
	------------
Carrying amount
At 31 December 2024	883,793
	------------
At 31 December 2023	1,205,172
	------------

The company has no intangible assets.

11. Tangible assets

Group	Freehold property	Equipment	Total
	£	£	£
Cost
At 1 January 2024	13,423,954	14,761,707	28,185,661
Additions	–	245,487	245,487
Disposals	–	( 1,098,760)	( 1,098,760)
	-------------	-------------	-------------
At 31 December 2024	13,423,954	13,908,434	27,332,388
	-------------	-------------	-------------
Depreciation
At 1 January 2024	–	14,204,221	14,204,221
Charge for the year	–	217,282	217,282
Disposals	–	( 902,044)	( 902,044)
	-------------	-------------	-------------
At 31 December 2024	–	13,519,459	13,519,459
	-------------	-------------	-------------
Carrying amount
At 31 December 2024	13,423,954	388,975	13,812,929
	-------------	-------------	-------------
At 31 December 2023	13,423,954	557,486	13,981,440
	-------------	-------------	-------------

The company has no tangible assets.

The freehold properties are depreciated over 50 years; however as they are maintained to a high standard the residual value is considered to be at least carrying value so no depreciation has been charged in the period.

Finance leases and hire purchase contracts

Included within the carrying value of tangible assets are the following amounts relating to assets held under finance leases or hire purchase agreements:

Group	Equipment
	£
At 31 December 2024	–
	----
At 31 December 2023	8,639
	-------

12. Investments

The group has no investments.

Company	Shares in group undertakings
	£
Cost
At 1 January 2024 and 31 December 2024	11,740,447
	-------------
Impairment
At 1 January 2024 and 31 December 2024	–
	-------------

Carrying amount
At 1 January 2024 and 31 December 2024	11,740,447
	-------------
At 31 December 2023	11,740,447
	-------------

All subsidiary undertakings have the same registered office as this company, and all are included in the consolidated accounts.

Subsidiaries, associates and other investments

Details of the investments in which the parent company has an interest of 20% or more are as follows:

	Class of share	Percentage of shares held
Subsidiary undertakings
RSM Leisure Ltd	Ordinary	100
The Abbey Hotel Golf & Country Club Ltd	Ordinary	100
Lea Marston Hotel & Leisure Complex Ltd	Ordinary	100

13. Stocks

	Group		Company
	2024	2023	2024	2023
	£	£	£	£
Raw materials and consumables	132,808	114,119	–	–
	---------	---------	----	----

14. Debtors

	Group		Company
	2024	2023	2024	2023
	£	£	£	£
Trade debtors	226,087	244,636	–	–
Amounts owed by group undertakings	–	199,048	6,566,737	6,566,883
Deferred tax asset	70,444	52,785	70,444	52,785
Prepayments and accrued income	126,792	116,244	–	–
Corporation tax repayable	25,970	–	254,063	–
Other debtors	25,171	15,483	201,343	674
	---------	---------	------------	------------
	474,464	628,196	7,092,587	6,620,342
	---------	---------	------------	------------

15. Creditors: amounts falling due within one year

	Group		Company
	2024	2023	2024	2023
	£	£	£	£
Bank loans and overdrafts	928,738	1,458,243	928,738	1,458,264
Trade creditors	249,451	467,644	–	–
Amounts owed to group undertakings	–	( 18,744)	–	8,600
Accruals and deferred income	860,746	892,204	99,864	59,596
Corporation tax	–	45,870	–	–
Social security and other taxes	310,714	302,409	–	–
Obligations under finance leases and hire purchase contracts	12,992	17,800	–	–
Other creditors	85,203	104,321	–	–
	------------	------------	------------	------------
	2,447,844	3,269,747	1,028,602	1,526,460
	------------	------------	------------	------------

Included in bank loans due within one year is an amount of £750,000 which is due for payment on 31 December 2024, following the reneogtiation of loans which took place in May 2024.

16. Creditors: amounts falling due after more than one year

	Group		Company
	2024	2023	2024	2023
	£	£	£	£
Debenture loans	7,339,839	7,246,989	7,339,839	7,246,989
Bank loans and overdrafts	9,478,202	9,914,118	9,478,202	9,914,118
Amounts owed to group undertakings	–	–	5,902,548	3,767,323
Obligations under finance leases and hire purchase contracts	–	12,992	–	–
	-------------	-------------	-------------	-------------
	16,818,041	17,174,099	22,720,589	20,928,430
	-------------	-------------	-------------	-------------

The company has a loan agreement with Metro Bank for a nominal value of £10,500,000 since April 2024.This loan bears interest at the MetroBank PLC's published base lending rate plus 3.5%. This Loan is on a 3 year commitment with capital and interest payments from the outset. The balance as at 31 Decemebr 2024 was £10,406,940. The company also has a loan from its parent company London & Regional Group Property Holdings Limited for an original amount of £9,500,000 and the balance at 31 December 2024 was £6,772,258 including accrued interest. This loan bears interest at the MetroBank PLC's published base lending rate plus 3.5%.

17. Finance leases and hire purchase contracts

The total future minimum lease payments under finance leases and hire purchase contracts are as follows:

	Group		Company
	2024	2023	2024	2023
	£	£	£	£
Not later than 1 year	12,992	17,800	–	–
Later than 1 year and not later than 5 years	–	12,992	–	–
	--------	--------	----	----
	12,992	30,792	–	–
	--------	--------	----	----

18. Provisions

Group	Deferred tax (note 19)
	£
At 1 January 2024	334,810
Additions	( 13,632)
Charge against provision	( 12,925)
	---------
At 31 December 2024	308,253
	---------

The company does not have any provisions.

19. Deferred tax

The deferred tax included in the statement of financial position is as follows:

	Group		Company
	2024	2023	2024	2023
	£	£	£	£
Included in debtors (note 14)	70,444	52,785	70,444	52,785
Included in provisions (note 18)	( 308,253)	( 334,810)	–	–
	---------	---------	--------	--------
	( 237,809)	( 282,025)	70,444	52,785
	---------	---------	--------	--------

The deferred tax account consists of the tax effect of timing differences in respect of:

	Group		Company
	2024	2023	2024	2023
	£	£	£	£
Accelerated capital allowances	320,845	347,402	–	–
Unused tax losses	( 12,592)	( 12,592)	–	–
Deferred tax - other timing differences	( 70,444)	( 52,785)	( 70,444)	( 52,785)
	---------	---------	--------	--------
	237,809	282,025	(70,444)	(52,785)
	---------	---------	--------	--------

20. Employee benefits

Defined contribution plans

The amount recognised in profit or loss as an expense in relation to defined contribution plans was £ 62,455 (2023: £ 58,138 ).

21. Called up share capital

Issued, called up and fully paid

	2024		2023
	No.	£	No.	£
Ordinary shares of £ 1 each	100	100	100	100
	----	----	----	----

22. Analysis of changes in net debt

	At 1 Jan 2024	Cash flows	At 31 Dec 2024
	£	£	£
Cash at bank and in hand	1,803,608	(926,959)	876,649
Debt due within one year	(1,457,299)	515,569	(941,730)
Debt due after one year	(17,174,099)	356,058	(16,818,041)
	-------------	---------	-------------
	( 16,827,790)	( 55,332)	( 16,883,122)
	-------------	---------	-------------

23. Related party transactions

Group

During the year the group entered into the following transactions with related parties:

	Transaction value		Balance owed by/(owed to)
	2024	2023	2024	2023
	£	£	£	£
Associated company	86,548	248,325	( 200,000)	–
Parent company	70,733	176,632	( 6,772,258)	( 6,701,225)
Director	22,117	56,452	( 567,581)	( 545,464)
	--------	---------	------------	------------

As described in the note 18, the group has an interest bearing loan from its parent company. The group also has a loan from the director.

Company

During the year the company entered into the following transactions with related parties:

	Transaction value		Balance owed by/(owed to)
	2024	2023	2024	2023
	£	£	£	£
Parent company	70,733	176,632	( 6,772,258)	( 6,701,525)
Director	22,117	56,452	( 567,581)	( 545,464)
	--------	---------	------------	------------

As described in the note 18, the company has an interest bearing loan from its parent company. The company also has a loan from the director. During the year, the group paid hotel management fees to Michels & Taylor (London) Ltd, an associated company.

Michels Ventures 2 Limited

Notes to the Financial Statements (continued)

Year ended 31 December 2024

24. Controlling party

The immediate parent undertaking is London and Regional Group Property Holdings Ltd , a company incorporated and registered in England and Wales. The ultimate parent undertaking is London and Regional Group Properties Ltd , a company incorporated in England and Wales. London and Regional Group Property Holdings Ltd is the parent undertaking of the smallest group of undertakings to consolidate these financial statement as at 31 December 2024. London and Regional Group Properties Ltd is the parent undertaking of the largest group of undertakings to consolidate these financial statements at 31 December 2024. The consolidated financial statements of London and Regional Group Properties Ltd can be obtained from the company secretary at 8th Floor, South Block, 55 Baker Street, London, United Kingdom W1U 8EW . The ultimate controlling parties are I.M. Livingstone and R.J. Livingston e through their joint ownership of London and Regional Group Properties Ltd.