The directors present the strategic report for the year ended 28 February 2025.

Dating back to the 19th Century and overlooking its privately owned beach, Carbis Bay Hotel, Spa and Estate offers a luxurious holiday destination.

The Hotel and Estate comprise of 35 individually-furnished hotel bedrooms, 4 serviced cottages, 7 apartments, 8 beach suites, 2 beach houses and 8 beachside lodges.

Also part of the Estate is the Gannet Inn and neighbouring Gannet House situated close to the main Estate comprising of a further 28 bedrooms.

The Estate offers guests a choice of three restaurants: The Orangery, The Beach Club and Walters on the Beach and a Deli offering local produce and gifts.

The on-site Spa consists of 5 treatment rooms, a hydrotherapy pool, sauna, a fitness suite and yoga studio.

The Group also includes Carbis Bay Holiday Lets Limited, a holiday letting service for a portfolio of privately-owned properties across Cornwall.

The group employed an average of 149 employees in the year, many of whom are local to the area. The management group regularly review the remuneration and benefits package offered to all employees to ensure this is fair and reasonable and in line with market conditions.

As a coastal resort in the heart of Cornwall, the Hotel prides itself on sourcing fresh produce from local suppliers and promoting Cornish independent businesses.

The hospitality industry continues to respond to the impact of the economy and climate.

Booking patterns have continued to reflect a shorter lead time in recent years and based on the uncertainty of the English weather, accommodation was affected by reduced demand.

Labour costs for the year were impacted by both the increase in national minimum and living wage in April 2024 and the Brexit restrictions but, we are now reducing the reliance on agency staff during peak months wherever possible compared to 2023/24. Labour costs will be impacted further in 2025/26 with the Employer National Insurance changes.

The results for the year and the financial position as detailed later within this report at the year end are considered satisfactory by the directors.

Carbis Bay Estate is exposed to the same risks as all businesses in the hospitality sector.

Competition

Economic factors impacting on guests disposable income

Labour resource post Brexit

Rising costs of food, wages and utilities

Weather

The hotel has developed a strong reputation and with the exposure of the Estate during the 2021 G7 Summit the brand is now recognised both domestically and internationally.

From a brand perspective and, based on tariff and guest profile, the directors feel that the Estate has moved away from its historic competitor set and is keen to sustain its current position in the market place. Although the Senior Management Team are constantly reviewing market trends and availability both internally and with local competitors to ensure all revenues are maximised they would prefer to avoid significant rate erosion.

Directors and Senior Management monitor both financial and non-financial key performance indicators on a day by day basis and have the infrastructure in place to react quickly to any exceptional results.

Unfortunately, even the weather plays a role in the success of a coastal property for families, the hotel offers an extremely popular “kids club” over the holiday periods offering crafts, pizza making and film nights to entertain the children during a typical Cornish summer.

The Group's operating profit for the year was £1,490,053 (2024: £1,936,945).

2024 included a £600,000 insurance claim receipt with respect to storm damage in 2018.

The results for the year and the financial position at the year end are considered satisfactory by the directors.

Key Financial Performance and Other Indicators are as follows:

Accommodation revenue has been affected by lower visitor numbers.

Following the launch of the new Carbis Bay Spa in 2022, it continues to grow with revenues increased by 7% in comparison to the prior year.

The Estate continues to be a popular venue for Weddings and Events with a 15% increase in related revenues in comparison to the prior year.

Key performance indicators also include customer satisfaction, occupancy rates, profitability and a number of other relevant factors.

On behalf of the board

The directors present their annual report and financial statements for the year ended 28 February 2025.

The results for the year are set out on page 10.

Ordinary dividends were paid amounting to £133,002. The directors do not recommend payment of a further dividend.

The directors who held office during the year and up to the date of signature of the financial statements were as follows:

The group manages its cash and borrowing requirements in order to maximise interest income and minimise interest expense, whilst ensuring the group has sufficient liquid resources to meet the operating needs of the business.

Investments of cash surpluses, borrowings and derivative instruments are made through banks and companies which must fulfil credit rating criteria approved by the Board.

All customers who wish to trade on credit terms are subject to credit verification procedures. Trade debtors are monitored on an ongoing basis and provision is made for doubtful debts where necessary.

As discussed within the Strategic Report, the directors anticipate that the business environment will remain competitive.  Identified risks will continue to be well managed and the directors have a clear strategy to continue to maintain the brand’s strong reputation.  The group is in a good financial position and the directors are confident in the group’s ability to maintain and build on this position.

Following the end of the year, two of the wholly owned subsidiaries, Carbis Bay Hotel Hospitality Limited and Carbis Bay Studio Limited, which ceased to trade in a prior year, were dissolved and the group has sold its shares in Adam Handling at Carbis Bay Limited, a joint venture.

RRL LLP were appointed as auditor to the group and in accordance with section 485 of the Companies Act 2006, a resolution proposing that they be re-appointed will be put at a General Meeting.

This report has been prepared in accordance with the provisions applicable to the companies entitled to medium-sized companies exemptions.true

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the auditor of the company is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the auditor of the company is aware of that information.

The directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the group and company, and of the profit or loss of the group for that period. In preparing these financial statements, the directors are 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 group and company will continue in business.

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

We have audited the financial statements of Carbis Bay Holdings Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 28 February 2025 which comprise the group profit and loss account, the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

• give a true and fair view of the state of the group's and the parent company's affairs as at 28 February 2025 and of the group's 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 Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the group and parent 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 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 group's and parent 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.

Other information

The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual 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.

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 our 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.

In the light of the knowledge and understanding of the group and the parent company and their 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 by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or

• the parent company financial statements are not in agreement with the accounting records and returns; or

• certain disclosures of directors' remuneration specified by law are not made; or

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

As explained more fully in the directors' responsibilities statement, 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 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 directors either intend to liquidate the parent company or to cease operations, or have no realistic alternative but to do so.

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.

As part of our audit work, we obtained an understanding of the legal and regulatory frameworks applicable to the group and parent company and the sector in which they operate. We determined that the laws and regulations most significant to the group and parent company, as well as the laws and regulations that have a direct impact on the preparation of the financial statements are: Health & Safety regulations, employment legislation, General Data Protection Regulation, Food Safety & Hygiene regulations and compliance with the Companies Act 2006.

The specific procedures for this engagement and the extent to which these are capable of detecting irregularities, including fraud is detailed below:

•    Discussion with management as to how compliance with these laws and regulations is monitored;

•    Review of the disclosures in the financial statements and testing to supporting documentation to assess

compliance with provisions of relevant laws and regulations described as having a direct effect on the

financial statements;

•    Enquiries of management concerning actual and potential litigation and claims;

•    Performing analytical procedures to identify any unusual or unexpected relationships that may indicate

risks of material misstatement due to fraud;

•    Reviewing correspondence with regulators;

•    Performing audit work in connection with the risk of management override of controls, including testing

journal entries for reasonableness and evaluating the business rationale of significant transactions

outside the normal course of business.

We also communicate relevant identified laws and regulations and potential fraud risk to all engagement team members and remain alert to any indications of fraud or non-compliance with laws and regulations throughout the audit.

Our audit approach also considered the opportunities and incentives that may exist within the group and parent company for fraud and identified the greatest potential for fraud being in respect of cut off and completion risk around revenue recognition. Under ISA (UK) we are also required to undertake procedures to respond to the risk of management override of controls. Our procedures included the following:

• Undertaking transactional testing on revenue, including cash sales

• Performing reconciliation work from the booking system to the nominal ledger to prove income in total between the different operating systems

• Performing cut off testing

• Auditing the risk of management override of controls, including through testing journal entries and other adjustments for appropriateness, and evaluating the business rationale for significant transactions outside the normal course of business

• Reviewing estimates and judgements made in the accounts for any indication of bias and challenged assumptions used by management in making estimates.

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 is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

Use of our report

This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.

These financial statements have been prepared in accordance with the provisions relating to medium-sized groups.

As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company's profit for the year was £201,988 (2024 - £108,432).

These financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime.

Carbis Bay Holdings Limited (“the company”) is a private company limited by shares domiciled and incorporated in England and Wales. The registered office is Peat House, Newham Road, Truro, Cornwall, TR1 2DP. The principal place of business is Carbis Bay Hotel, Carbis Bay, St Ives, Cornwall, TR26 2NP.

The group consists of Carbis Bay Holdings Limited and all of its subsidiaries.

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

The company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements for parent company information presented within the consolidated financial statements:

• Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;

• Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues: Interest income/expense and net gains/losses for financial instruments not measured at fair value; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;

• Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.

In the parent company financial statements, the cost of a business combination is the fair value at the acquisition date of the assets given, equity instruments issued and liabilities incurred or assumed, plus costs directly attributable to the business combination. The excess of the cost of a business combination over the fair value of the identifiable assets, liabilities and contingent liabilities acquired is recognised as goodwill. The cost of the combination includes the estimated amount of contingent consideration that is probable and can be measured reliably, and is adjusted for changes in contingent consideration after the acquisition date. Provisional fair values recognised for business combinations in previous periods are adjusted retrospectively for final fair values determined in the 12 months following the acquisition date. Investments in subsidiaries, joint ventures and associates are accounted for at cost less impairment.

Deferred tax is recognised on differences between the value of assets (other than goodwill) and liabilities recognised in a business combination accounted for using the purchase method and the amounts that can be deducted or assessed for tax, considering the manner in which the carrying amount of the asset or liability is expected to be recovered or settled. The deferred tax recognised is adjusted against goodwill or negative goodwill.

The consolidated group financial statements consist of the financial statements of the parent company Carbis Bay Holdings Limited together with all entities controlled by the parent company (its subsidiaries) and the group’s share of its interests in joint ventures and associates.

All financial statements are made up to 28 February 2025. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.

All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.

Subsidiaries are consolidated in the group’s financial statements from the date that control commences until the date that control ceases.

Entities in which the group holds an interest and which are jointly controlled by the group and one or more other venturers under a contractual arrangement are treated as joint ventures. Entities other than subsidiary undertakings or joint ventures, in which the group has a participating interest and over whose operating and financial policies the group exercises a significant influence, are treated as associates.

Investments in joint ventures and associates are carried in the group balance sheet at cost plus post-acquisition changes in the group’s share of the net assets of the entity, less any impairment in value. The carrying values of investments in joint ventures and associates include acquired goodwill.

If the group’s share of losses in a joint venture or associate equals or exceeds its investment in the joint venture or associate, the group does not recognise further losses unless it has incurred obligations to do so or has made payments on behalf of the joint venture or associate.

Unrealised gains arising from transactions with joint ventures and associates are eliminated to the extent of the group’s interest in the entity.

At the time of approving the financial statements, the directors have a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.

The group as a number of revenue streams, each of which has a specific revenue recognition policy.

The group recognises revenue from the following major sources:

• Accommodation sales, events and room hire and management of holiday accommodation

• Food and beverage sales

• Spa and salon income

Accommodation sales

For accommodation, turnover is recognised daily from the day of arrival, and for events and room hire, turnover is recognised on the day of the event.

Deposits received in advance of customer stays are treated as deferred income and recognised within creditors payable in less than one year.

Commissions earned in respect of the management of holiday accommodation is recognised at the point the customer stay commences.

Food and beverage sales

Turnover from food and beverage sales is recognised on a daily basis once the goods and services have been provided to the customer and the right to consideration has been earned.

Spa and salon income

Turnover for spa and salon services provided by the hotel is recognised on a daily basis once the services have been provided to the customer and the right to consideration has been earned.

Tangible fixed assets are initially measured at cost and subsequently measured at cost, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

No depreciation has been charged on the freehold property on the basis that the residual values are in excess of the book amounts. Freehold land is not depreciated.

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in the profit and loss account.

Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available.

In the parent company financial statements, investments in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.

A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The group considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.

Investments in associates are initially recognised at the transaction price (including transaction costs) and are subsequently adjusted to reflect the group’s share of the profit or loss, other comprehensive income and equity of the associate using the equity method. Any difference between the cost of acquisition and the share of the fair value of the net identifiable assets of the associate on acquisition is recognised as goodwill. Any unamortised balance of goodwill is included in the carrying value of the investment in associates.

Losses in excess of the carrying amount of an investment in an associate are recorded as a provision only when the company has incurred legal or constructive obligations or has made payments on behalf of the associate.

In the parent company financial statements, investments in associates are accounted for at cost less impairment.

Entities in which the group has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.

At each reporting period end date, the group reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and those overheads that have been incurred in bringing the stocks to their present location and condition.

Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

The group has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

Financial instruments are recognised in the group's balance sheet when the group becomes party to the contractual provisions of the instrument.

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.

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method 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. Financial assets classified as receivable within one year are not amortised.

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the group transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the group after deducting all of its liabilities.

Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, 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 payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

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

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable 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.

Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.

Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

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

Equity instruments issued by the group are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the group.

The tax expense represents the sum of the tax currently payable and deferred tax.

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax liabilities are generally recognised for all timing differences and 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. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset if, and only if, there is a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.

Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.

Exceptional items

Amounts shown as an exceptional items include transactions that are presented separately due to their size or nature. See note 4.

In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount 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 primary judgement is the decision by the directors to not depreciate the freehold property. The current value of freehold properties is considered annually by the directors. Depreciation is not provided for as the directors consider the market value, and therefore the residual value, of the property to exceed the book value of these properties recognised in the accounts.

The average monthly number of persons (including directors) employed by the group and company during the year was:

Their aggregate remuneration comprised:

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounts to 2 (2024 - 0).

No share options have been exercised.

The investment in Adam Handling at Carbis Bay Hotel Limited has been written down following the closure of the business post year end.

The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:

Impairment tests have been carried out where appropriate and the following impairment losses have been recognised in profit or loss:

The impairment losses in respect of financial assets are recognised in other gains and losses in the profit and loss account.

The investment in Adam Handling at Carbis Bay Hotel Limited has been written down following the closure of the business post year end.

The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.

The company has applied the transitional arrangements of Section 35 of FRS 102 and used a previous valuation as the deemed cost for freehold properties.

If revalued assets were stated on an historical cost basis rather than at valuation, the carrying amounts would have been as follows:

Details of the company's subsidiaries at 28 February 2025 are as follows:

For the year ended 28 February 2025 the following subsidiaries were entitled to exemption from audit under section 479A of the Companies Act 2006 relating to subsidiary companies:

CB Building & Developments Limited

Carbis Bay Property Limited

Carbis Bay Hotel Hospitality Limited and Carbis Bay Studio Limited were dormant for the year and subsequently dissolved after the year end.

Details of joint ventures at 28 February 2025 are as follows:

The restaurant operated by Adam Handling at Carbis Bay Hotel Limited, a joint venture company in which Carbis Bay Holdings Limited owns 50% of the share capital, closed in June 2025.  This company is now dormant.

Bank loans are secured by fixed and floating charges over the group's assets. The aggregate amount of borrowings is £11,236,171 (2024: £11,886,225).

The bank loan is over a term of 5 years at an interest rate of 1.7% over bank base rate with a final payment of the balance at the end of the loan term.

Finance lease payments represent rentals payable by the company or group for certain items of plant and machinery. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is 5 years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.

Finance leases are secured on the assets to which they relate.

Deferred income consists of deposits received in advance.

The following are the major deferred tax liabilities and assets recognised by the group and company, and movements thereon:

The expected net reversal of deferred tax assets and liabilities in 2025 is £11,203 being the expected movement in accelerated capital allowances.

A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.

At the year end the group owed the pension scheme £13,382 (2024: £13,367).

A, B and C shares hold equal voting rights. The D shares have no voting rights but carry a right to a fixed income.

There is no unallotted share capital.

Company

An omnibus guarantee, set off agreement and debenture is in place over assets within this company to secure the indebtedness of a fellow subsidiary, Atlantic Bay Hotel Limited. The contingent liability at 29 February 2025 is £11,236,171 (2024: £11,886,225).

Amounts contracted for but not provided in the financial statements:

This relates to kitchen refurbishment costs incurred shortly after the year end.

The remuneration of key management personnel is as follows.

On 5 August 2011 MWG Baker, director and owner of the freehold of the hotel site, granted a 999 year lease to SP Baker, as nominee for Carbis Bay Hotel Limited, subsidiary of Carbis Bay Holdings Limited. SP Baker is therefore the legal tenant under the lease but Carbis Bay Hotel Limited has the beneficial interest in the tenancy. The freehold is now held by the estate of MWG Baker.

During the year properties owned by directors were rented to Carbis Bay Hotel Limited, subsidiary of Carbis Bay Holdings Limited, for staff accommodation. The rent paid by the hotel was £18,000 (2024: £43,500).

During the year, properties were purchased from the directors totalling £nil (2024: £470,000), based on RICS red book valuations.

During the year properties owned by the directors were managed by Carbis Bay Hotel Limited. The directors paid £2,520 (2024: £2,520) in management charges to Carbis Bay Hotel Limited during the year for this service.

During the year salaries were paid to close family members of the directors amounting to £Nil (2024: £4,167).

In a prior year a loan due from a director, who has since deceased, was converted to redeemable preference shares.  As these can be redeemed on demand, they are recognised as a financial liability and included within creditors within 1 year.  Interest totalling £500 was received in the year (2024: £nil). Dividends totalling £nil were received in the year (2024: £500). The balance due to the director's estate as at 28 February 2025 was £501,500 (2024: £501,000).

During the year services were sold to Adam Handling at Carbis Bay Limited, a joint venture totalling £70,347 (2024: £55,200). During the year services were purchased from Adam Handling Limited totalling £119,689 (2024: £210,906). At the year end the company owed £10,819 (2024: £41,345) to Adam Handling at Carbis Bay Limited.

Dividends totalling £103,000 (2024 - £2,000) were paid in the year in respect of shares held by the company's directors.

Interest is payable on the loans as detailed below:

The ultimate controlling party is Mr SP Baker, director.

On 20 May 2025, Carbis Bay Studio Limited and Carbis Bay Hotel Hospitality Limited, subsidiaries of Carbis Bay Holdings Limited were dissolved.

The restaurant operated by Adam Handling at Carbis Bay Hotel Limited, a joint venture company in which Carbis Bay Holdings Limited owns 50% of the share capital, closed in June 2025.  This company is now dormant.

For the year ended 28 February 2025, the company entered into a liability limitation agreement with its auditors, the principal terms of which limit the liability of the auditors to £5,000,000 in relation to their responsibilities as auditors of the company. The date this was agreed by the company was 15 May 2025.