REGISTERED NUMBER: 11484891 (England and Wales)

STRATEGIC REPORT, REPORT OF THE DIRECTORS AND

FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2025

FOR

HSF LONDON LIMITED

Page

Company Information

1

Strategic Report

2

Report of the Directors

6

Report of the Independent Auditors

8

Statement of Comprehensive Income

11

Balance Sheet

12

Statement of Changes in Equity

13

Cash Flow Statement

14

Notes to the Cash Flow Statement

15

Notes to the Financial Statements

16

DIRECTORS:

L Riu Guell

J Trian Riu

N Riu Rodriguez

SECRETARY:

P S Bunce

REGISTERED OFFICE:

Riu Plaza London Victoria Hotel

1 Neathouse Place

Pimlico

London

SW1V 1LH

REGISTERED NUMBER:

11484891 (England and Wales)

AUDITORS:

Watson Associates (Audit Services) Ltd

Statutory Auditor

30 - 34 North Street

Hailsham

East Sussex

BN27 1DW

The directors present their strategic report for the year ended 31 December 2025.

REVIEW OF BUSINESS

Principal Activity and Background

HSF London Limited is a hotel operating company incorporated in England and Wales (registered number 11484891). The Company operates the Riu Plaza London Victoria Hotel, situated at 1 Neathouse Place, Pimlico, London, a premium hotel in the heart of central London.

The Company commenced trading on 28 July 2023, following the completion of the construction of the hotel. The year ended 31 December 2025 represents the Company's second full year of operations. The hotel operates across three principal revenue streams: room sales, restaurant sales and bar sales.

The Company is a wholly owned subsidiary of RIU Hotels SA, a company incorporated in Spain and headquartered in Palma de Mallorca. RIU Hotels SA assumed its position as immediate parent undertaking following its merger with the Company's former parent company, Hotel San Francisco SA. The merger was effective from 1 January 2025 and was formally registered in the Registro Mercantil on 25 July 2025. The RIU Hotels group is a well-established international hotel operator with an extensive portfolio of properties across Europe and beyond.

Financial Performance

The year ended 31 December 2025 marked the Company's second full year of trading. Revenue for the year amounted to £30.94 million (2024: £31.16 million), representing a marginal decrease of £0.22 million or 0.7%. The directors consider this performance to be satisfactory given the maturity of the hotel in only its second full trading year and the competitive nature of the London hotel market.

Gross profit improved to £21.04 million (2024: £20.55 million), an increase of £0.49 million. The gross profit margin increased to 68.0% (2024: 65.9%), reflecting the benefit of a lower cost of sales base. Notably, agency commissions reduced to £1.97 million (2024: £2.71 million), contributing significantly to the improvement in gross margin.

Operating profit was £11.05 million (2024: £11.99 million). The decrease reflects an increase in administrative expenses to £10.02 million (2024: £8.58 million), which included higher management charges of £3.24 million (2024: £3.11 million), increased rates and water charges of £1.41 million (2024: £1.33 million) and the impact of repairs and renewals of £0.78 million (2024: £0.66 million).

Interest costs reduced materially to £4.43 million (2024: £5.00 million), reflecting the reduction in the loan balance through principal repayments made during the year. Profit before taxation was £6.62 million (2024: £6.99 million).

Profit after taxation for the year was £4.55 million (2024: £6.25 million). The net assets of the Company at the balance sheet date were £168.43 million (2024: £163.89 million), reflecting the continuing strengthening of the balance sheet as the Company matures.

Key Performance Indicators

The directors monitor a number of key performance indicators to assess the trading performance of the hotel and to evaluate its position relative to the wider London hotel market. The principal KPIs reviewed by the board and the comparative performance across the two full trading years, are set out below:

Key Performance Indicators

2025

2024

% Change

Occupancy Rates

96.1%

96.0%

+0.1%

Average Room Rate (ARR)

£200.31

£200.08

+0.1%

Revenue per available room (REVPAR)

£192.53

£192.08

+0.2%

Gross Profit Margin

68.0%

65.9%

+3.2%

The Company achieved an occupancy rate of 96.1% in the year (2024: 96.0%), which the directors consider to be exceptional for a hotel in the London market. The average room rate of £200.31 (2024: £200.08) remained broadly stable, as did RevPAR at £192.53 (2024: £192.08). The most notable improvement in performance metrics was the gross profit margin, which increased by 3.2 percentage points to 68.0%, driven primarily by the reduction in agency commission costs and other direct costs.

PRINCIPAL RISKS AND UNCERTAINTIES

The directors have identified the following as the principal risks and uncertainties facing the Company:

a. Treasury and Financing Risk

The Company is financed by an intercompany loan from its parent company, RIU Hotels SA (previously Hotel San Francisco SA). The loan carries interest at the quarterly SONIA rate plus 0.50% per annum. The Company has no external banking facilities and is reliant on the continued financial support of its parent group. The directors are satisfied that the parent group has both the intention and the financial capacity to provide the necessary support to the Company for the foreseeable future.

During the year, the Company made loan repayments totalling £12.25 million, reducing the interest burden on the business. New loans of £21.53 million were drawn in the year to fund the deposit paid in connection with the acquisition described in Note 22. The outstanding loan balance at 31 December 2025 was £120.13 million (2024: £99.25 million).

b. Liquidity Risk

The Company manages its working capital requirements carefully to ensure that it maintains sufficient liquid resources to meet its operating obligations as they fall due. Cash generated from operations in the year was £14.36 million (2024: £13.78 million) , demonstrating the strong cash generative nature of the hotel business. Cash and cash equivalents at 31 December 2025 stood at £1.99 million (2024: £0.58 million).

The directors have prepared cash flow forecasts for the year ending 31 December 2026, which indicate that the Company will continue to generate sufficient liquidity from its operations to meet its obligations. The directors are satisfied that the liquidity position of the Company is adequate.

It should be noted that the Company's liquidity position is materially influenced by the continued financial support of its parent group. During the year under review, the Company paid a deposit of £21,525,000 in connection with the acquisition of a further hotel business in central London, by way of the purchase of the entire issued share capital of Carolia Westminster Hotel Limited, details of which are set out in the Future Business Developments section below and in Note 22 to the financial statements. A further £7,175,000 of the deposit was paid directly to the seller's solicitors by RIU Hotels SA on behalf of the Company. Both amounts have been recognised as a fixed asset investment on the balance sheet at 31 December 2025. The directors are satisfied that RIU Hotels SA has both the financial capacity and the intention to continue providing the necessary funding support to the Company and its expanded operations going forward. The Company does not have and does not currently require, any external banking facilities.

c. Credit Risk

The Company is exposed to credit risk principally through its trade receivables, which include amounts owed by corporate accounts, travel agencies and related party entities. Trade debtors at 31 December 2025 amounted to £1.13 million (2024: £1.34 million). The Company operates strict credit control procedures, including pre-payment policies for retail bookings and regular monitoring of outstanding corporate balances. Credit terms are offered selectively and the creditworthiness of customers is assessed before extending credit facilities.

The Company also has related party trading relationships with Reservation Shop SLU and Riusa II SA, companies under common control. At the balance sheet date, amounts owed by Reservation Shop SLU were £305,932 (2024: £198,449) and amounts owed to Riusa II SA were £305,739 (2024: £277,283). The directors consider these balances to be recoverable and payable in the ordinary course of business.

d. Strategic and Market Risk

The hotel operates in the highly competitive London hotel market, where performance can be adversely affected by macroeconomic conditions, changes in consumer preferences, shifts in travel patterns and geopolitical events. The directors mitigate strategic risk through continuous monitoring of market conditions, diversification of revenue streams across room, restaurant and bar sales, targeted marketing initiatives and active management of distribution channels.

The Company also benefits from being part of the wider RIU Hotels group, which provides access to group-level marketing resources, reservations infrastructure and operational expertise. The brand recognition of the RIU Hotels group is considered to be a significant competitive advantage in the London market.

e. Regulatory and Compliance Risk

As a hotel operator in London, the Company is subject to a range of regulatory requirements in areas including health and safety, employment law, licensing and indirect taxation. The directors maintain appropriate internal procedures and controls to ensure compliance with all applicable regulatory requirements and engage external advisers where specialist input is required.

FUTURE BUSINESS DEVELOPMENTS

Trading Outlook

The directors expect the Company to deliver a consistent level of trading performance in the year ending 31 December 2026. Budgeted turnover for 2026 is £29.86 million, with a budgeted EBIT of £18.81 million, representing a significant improvement on the EBIT achieved in the current year. The improvement is anticipated to arise principally from more effective management of the Company's cost base and a continued focus on revenue quality.

Occupancy rates are expected to remain at a high level. Budgeted room occupancy for 2026 is 93.86%, which is slightly below the exceptional rate of 96.1% achieved in the current year but remains at a strong level for the London market. Advance bookings into 2026 are described by management as robust, with further bookings expected as the year progresses.

Post Balance Sheet Acquisition

Subsequent to the year end, the Company completed a significant acquisition. On 8 January 2026, the Company acquired 100% of the issued share capital of Carolia Westminster Hotel Limited, which operates a hotel in central London.

Prior to the year end, a deposit of £28,700,000 was paid, representing 10% of the total initial consideration, of which £21,525,000 was paid directly by the Company and the remaining £7,175,000 was paid directly to the seller's solicitors by RIU Hotels SA on behalf of the Company, as described in the Liquidity Risk section above. The full deposit has been recognised on the balance sheet as a fixed asset investment at 31 December 2025. The remaining consideration was paid on completion in January 2026, funded through intercompany financing provided by RIU Hotels SA. Further details are set out in Note 22 to the financial statements.

The directors consider this acquisition to be highly significant to the future development of the Company and expect it to have a material impact on the financial position, revenue base and profitability of the business in the year ending 31 December 2026 and beyond. Further details are set out in Note 22 to the financial statements.

ON BEHALF OF THE BOARD:

J Trian Riu - Director

29 April 2026

The directors present their report with the financial statements of the company for the year ended 31 December 2025.

PRINCIPAL ACTIVITY

The principal activity of the company in the year under review was that of a hotel operator.

DIVIDENDS

No dividends will be distributed for the year ended 31 December 2025.

EVENTS SINCE THE END OF THE YEAR

Subsequent to the year end, on 8 January 2026, the Company acquired 100% of the issued share capital of Carolia Westminster Hotel Limited. The acquisition represents a significant expansion of the Company's hotel operations in London. Further details are provided in Note 22 to the financial statements.

DIRECTORS

The directors shown below have held office during the whole of the period from 1 January 2025 to the date of this report.

L Riu Guell

J Trian Riu

N Riu Rodriguez

FURTHER BUSINESS REVIEW AND RISKS

The principal risks and uncertainties the company continues to face are treasury and financing risk, liquidity risk, credit risk, strategic and market risk and regulatory and compliance risk.

RIU Hotels SA became the Company's immediate parent undertaking following its merger with Hotel San Francisco SA, effective 1 January 2025 and formally registered in the Registro Mercantil on 25 July 2025 and continues to provide ongoing financial support to the Company. As a result, additional funding measures are not considered necessary. The directors are satisfied that the liquidity position of the Company remains stable and forecasts prepared for the year ending 31 December 2026 indicate that this will continue to be the case.

Occupancy rates for the hotel since opening have continually increased. Advance bookings looking ahead to 2026 are also at a strong level with further bookings expected as the year progresses.

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The directors are responsible for preparing the Strategic Report, the Report of the Directors 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), including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:

-	select suitable accounting policies and then apply them consistently;

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

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

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

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS

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

AUDITORS

The auditors, Watson Associates (Audit Services) Ltd, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

J Trian Riu - Director

29 April 2026

Opinion

We have audited the financial statements of HSF London Limited (the 'company') for the year ended 31 December 2025 which comprise the Statement of Comprehensive Income, Balance Sheet, Statement of Changes in Equity, Cash Flow Statement and Notes to the Cash Flow Statement, Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

-	give a true and fair view of the state of the company's affairs as at 31 December 2025 and of its profit for the year then ended;

-	have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

-	have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

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

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Other information

The directors are responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon.

Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

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

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

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

Matters on which we are required to report by exception

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

We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:

-	adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or

-	the financial statements are not in agreement with the accounting records and returns; or

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

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

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities set out on page six, 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 necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Auditors' responsibilities for the audit of the financial statements

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

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

Based on our understanding of the company and industry, we identified that the principal risks of non-compliance with laws and regulations related to employment laws and indirect taxes, and we considered the extent to which non-compliance might have a material effect 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 achieve desired financial results and the manipulation of exceptional items and management bias in accounting estimates. Audit procedures performed by the engagement team included, but were not limited to:

- enquiries with management, including consideration of known or suspected instances of fraud and non-compliance with laws and regulations and examining supporting calculations where a provision has been made in respect of these;

- reading key correspondence with regulatory authorities in relation to compliance with certain employment laws and indirect tax matters;

- understanding and evaluating the design and implementation of management's controls designed to prevent and detect irregularities;

- challenging assumptions and judgements made by management in their significant accounting estimates;

- identifying and testing journal entries in particular and journal entries posted with unusual account combinations and postings by unusual users;

These 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 one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion.

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

Use of our report

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

Geoffrey David Slater (Senior Statutory Auditor)

for and on behalf of Watson Associates (Audit Services) Ltd

Statutory Auditor

30 - 34 North Street

Hailsham

East Sussex

BN27 1DW

8 May 2026

TURNOVER

30,935,887

31,160,945

Cost of sales

(9,899,219

)

(10,615,380

)

GROSS PROFIT

21,036,668

20,545,565

Administrative expenses

(10,018,619

)

(8,578,090

)

11,018,049

11,967,475

Other operating income

28,040

25,157

OPERATING PROFIT

5

11,046,089

11,992,632

Interest payable and similar expenses

6

(4,429,218

)

(5,002,792

)

PROFIT BEFORE TAXATION

6,616,871

6,989,840

Tax on profit

7

(2,071,457

)

(737,159

)

PROFIT FOR THE FINANCIAL YEAR

4,545,414

6,252,681

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

4,545,414

6,252,681

FIXED ASSETS

Intangible assets

8

4,459

11,111

Tangible assets

9

260,876,488

264,412,562

Investments

10

28,700,000

-

289,580,947

264,423,673

CURRENT ASSETS

Stocks

11

53,868

43,651

Debtors

12

1,743,685

3,246,943

Cash at bank and in hand

1,992,483

579,118

3,790,036

3,869,712

CREDITORS

Amounts falling due within one year

13

(1,941,717

)

(2,361,749

)

NET CURRENT ASSETS

1,848,319

1,507,963

TOTAL ASSETS LESS CURRENT LIABILITIES

291,429,266

265,931,636

CREDITORS

Amounts falling due after more than one year

14

(120,128,048

)

(99,761,220

)

PROVISIONS FOR LIABILITIES

17

(2,870,080

)

(2,284,692

)

NET ASSETS

168,431,138

163,885,724

CAPITAL AND RESERVES

Called up share capital

18

178,000,001

178,000,001

Retained earnings

19

(9,568,863

)

(14,114,277

)

SHAREHOLDERS' FUNDS

168,431,138

163,885,724

The financial statements were approved by the Board of Directors and authorised for issue on 29 April 2026 and were signed on its behalf by:

J Trian Riu - Director

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 January 2024

178,000,001

(20,366,958

)

157,633,043

Changes in equity

Total comprehensive income

-

6,252,681

6,252,681

Balance at 31 December 2024

178,000,001

(14,114,277

)

163,885,724

Changes in equity

Total comprehensive income

-

4,545,414

4,545,414

Balance at 31 December 2025

178,000,001

(9,568,863

)

168,431,138

Cash flows from operating activities

Cash generated from operations

1

14,355,762

13,776,730

Interest paid

-

(775

)

Tax paid

(676,766

)

-

Net cash from operating activities

13,678,996

13,775,955

Cash flows from investing activities

Purchase of intangible fixed assets

-

(1,087

)

Purchase of tangible fixed assets

(15,631

)

(329,330

)

Deposit for acquisitions of shares

(21,525,000

)

-

Net cash from investing activities

(21,540,631

)

(330,417

)

Cash flows from financing activities

New loans in year

21,525,000

-

Loan repayments in year

(12,250,000

)

(13,700,000

)

Net cash from financing activities

9,275,000

(13,700,000

)

Increase/(decrease) in cash and cash equivalents

1,413,365

(254,462

)

Cash and cash equivalents at beginning of year

2

579,118

833,580

Cash and cash equivalents at end of year

2

1,992,483

579,118

1.	RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS

2025

2024

£

£

Profit before taxation

6,616,871

6,989,840

Depreciation charges

3,516,626

2,573,339

Finance costs

4,429,218

5,002,792

14,562,715

14,565,971

(Increase)/decrease in stocks

(10,217

)

4,429

Decrease/(increase) in trade and other debtors

364,232

(575,755

)

Decrease in trade and other creditors

(560,968

)

(217,915

)

Cash generated from operations

14,355,762

13,776,730

2.	CASH AND CASH EQUIVALENTS

The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts:

Year ended 31 December 2025

31.12.25

1.1.25

£

£

Cash and cash equivalents

1,992,483

579,118

Year ended 31 December 2024

31.12.24

1.1.24

£

£

Cash and cash equivalents

579,118

833,580

3.	ANALYSIS OF CHANGES IN NET DEBT

At 1.1.25

Cash flow

At 31.12.25

£

£

£

Net cash

Cash at bank and in hand

579,118

1,413,365

1,992,483

579,118

1,413,365

1,992,483

Debt

Debts falling due after 1 year

(99,248,829

)

(20,879,219

)

(120,128,048

)

(99,248,829

)

(20,879,219

)

(120,128,048

)

Total

(98,669,711

)

(19,465,854

)

(118,135,565

)

1.	STATUTORY INFORMATION

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

2.	ACCOUNTING POLICIES

Basis of preparing the financial statements

These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

Turnover

Turnover comprises room sales, restaurant sales and bar sales excluding discounts, value added tax and other sales taxes. Turnover is recognised as follows:

Room sales

- Daily based on first evening of stay

Restaurant sales

- Daily at the close of business

Bar sales

- Daily at the close of business

Consideration received is recognised as turnover to the extent that the company has performed its contractual obligations in respect of that consideration.

Intangible assets

Intangible assets are initially measured at cost. After initial recognition, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.

Computer software is being amortised evenly over its estimated useful life of three years.

Tangible fixed assets

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

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

Land

- Not depreciated

Freehold property

- 39 years straight line

Fixtures and fittings

- 7 years straight line

Computer equipment

- 5 years straight line

The construction of the hotel was completed during the period under review. Properties are carried at cost, which includes professional fees and other directly attributable costs that are necessary to bring the property to its operating condition, less any identified impairment loss.

Depreciation is provided on all tangible fixed assets at rates calculated to write off the cost or valuation of each asset to its estimated residual value on a straight line basis over its expected useful life.

Stocks

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

Financial instruments

The company only enters into basic financial instruments transactions that result in the recognition of financial assets and liabilities like trade and other accounts receivable and payable, loans from banks and other third parties, and loans to related parties.

Debt instruments that are payable or receivable within one year, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received; other debt instruments are initially measured at present value of the future payments and subsequently at amortised cost using the effective interest method.

Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in profit or loss.

Financial assets and liabilities are offset and the net amount reported in the balance sheet only when there is an 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.

Taxation

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

Current or deferred taxation assets and liabilities are not discounted.

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

Deferred tax

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

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

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

Hire purchase and leasing commitments

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

Pension costs and other post-retirement benefits

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

Going concern

The company generated a profit after tax for the year of £4,545,414 (2024: £6,252,681) but has net assets of £168,431,138 (2024: £163,885,724). Notwithstanding, the financial statements have been prepared on a going concern basis which the directors consider to be appropriate due to the reasons set out below:

The company commenced trading on 28 July 2023 and in the year under review completed their second full year of trading, the directors have prepared forecasts for 2026 to reflect the trading nature of the hotel.

The forecasts show budgeted turnover for 2026 of £29,862,797 and a budgeted EBIT of £18,808,138. The interest costs due to the parent company RIU Hotels SA, are to be deducted from the budgeted EBIT. On the 19 August 2025, RIU Hotels SA became the new parent company to HSF London Limited. The loan transferred from Hotel San Francisco SA on this date. Furthermore, budgeted room occupancy rates for the year is 93.86% which is consistent but a little lower than the occupancy rate seen in the current year of 96.1%.

The Company has been financed throughout the year by its parent company, RIU Hotels SA. RIU Hotels SA became the Company's immediate parent undertaking following its merger with the Company's former parent, Hotel San Francisco SA, which was effective from 1 January 2025 and formally registered in the Registro Mercantil on 25 July 2025. On that date, the intercompany loan transferred in full to RIU Hotels SA. During the year, payments totalling £12,250,000 were made to the parent company in respect of accrued interest on the intercompany loan balance.

In connection with the acquisition of Carolia Westminster Hotel Limited, which completed on 8 January 2026, a deposit of £28,700,000 was paid prior to the year end. Of this amount, £21,525,000 was paid directly by the Company and the remaining £7,175,000 was paid directly to the seller's solicitors by RIU Hotels SA on behalf of the Company. The remaining consideration was paid on completion in January 2026 through intercompany financing provided by RIU Hotels SA. The directors are satisfied that RIU Hotels SA has both the financial capacity and the intention to continue providing the necessary support to the Company and its expanded operations for the foreseeable future.

3.	CRITICAL ACCOUNTING 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.

Critical judgements in applying the Company’s accounting policies

There were no critical judgements identified in applying the Company’s accounting policies in the current year.

Key sources of estimation uncertainty

There are assumptions made in respect of the useful economic lives of tangible and intangible fixed assets along with related residual values as well as the recoverability of the unrecognised deferred tax assets and the related anticipated reversal of timing differences. These are based on best estimates at the time and useful economic lives of tangible and intangible fixed assets are reviewed periodically.

The Company had made assumptions concerning the future. The resulting assumptions will, by definition, seldom equal the related actual results. The assumptions that could have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses. Properties in the course of construction are carried at cost, less any identified impairment loss. Depreciation commenced during the year under review once the properties were ready for their intended use.

4.	EMPLOYEES AND DIRECTORS

2025

2024

£

£

Wages and salaries

4,706,514

4,582,695

Social security costs

309,204

240,077

Other pension costs

29,084

25,550

5,044,802

4,848,322

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

2025

2024

Management

4

4

Administration

9

8

Hotel Staff

76

74

89

86

2025

2024

£

£

Directors' remuneration

-

-

5.	OPERATING PROFIT

The operating profit is stated after charging/(crediting):

2025

2024

£

£

Employee benefits

35,037

25,247

Depreciation - owned assets

3,509,975

2,566,569

Computer software amortisation

6,652

6,769

Auditors' remuneration

29,750

27,500

Foreign exchange differences

25,975

(18,509

)

6.

INTEREST PAYABLE AND SIMILAR EXPENSES

2025

2024

£

£

Loan

4,429,218

5,002,017

Other Financial Expenses

-

775

4,429,218

5,002,792

7.

TAXATION

Analysis of the tax charge

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

2025

2024

£

£

Current tax:

UK corporation tax

204,762

-

Prior year taxation

142,282

-

Total current tax

347,044

-

Deferred tax

1,724,413

737,159

Tax on profit

2,071,457

737,159

Reconciliation of total tax charge included in profit and loss

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

2025

2024

£

£

Profit before tax

6,616,871

6,989,840

Profit multiplied by the standard rate of corporation tax in the UK of 25% (2024 - 25%)

1,654,218

1,747,460

Effects of:

Expenses not deductible for tax purposes

117

742

Capital allowances in excess of depreciation

(10,376

)

(332,669

)

Utilisation of tax losses

(1,454,762

)

(1,708,019

)

Corporate Interest Restriction

15,565

750,504

deduction

Deferred Taxation

1,724,413

737,159

Other tax adjustments

-

(458,018

)

Prior year taxation

142,282

-

Total tax charge

2,071,457

737,159

Deferred tax assets are calculated using the corporation tax rate at which they are expected to be utilised of 25.00%. Deferred tax in respect of tax losses are only recognised to the extent future taxable profits are available against which to utilise the deferred tax asset.