The directors present the strategic report for the year ended 30 September 2025.

The Company achieved a healthy growth in sales of 2.2% to £15,792,712. Successful marketing strategies grew the accommodation business improving ADR (Average Daily Rate) by 4.6% and restaurant covers by 2.7%. The £324,659 of revenue growth enabled us to cope with the cost pressures faced by the wider hospitality industry.

Profit before tax showed an improvement of £357,451 versus 2024, this included a gain on the investment properties, namely The Dolphin in Thorpeness. Throughout the year, numerous efficiency projects have been implemented to improve profitability in future years to cope with the increased cost pressures.

Overall, the future position of the business is robust, fit, and able to maximise another strong year of trading.

The potential risks to the hospitality sector are well documented and The Hotel Folk is not immune to these challenges.

Increase in the minimum wage to £12.21 in April 2025 compounded with the increase in Employers National Insurance and reduction in thresholds further exacerbated wage cost. Within a full financial year this increase in Employers National Insurance will increase labour more than £200,000 excluding increases in the minimum wage.

Utility contracts remained fixed over the longer-term on both gas and electricity, a further year of business rate relief created an upside to help offset some of the challenges in labour cost. From April 2026 business rate relief will no longer apply to the hotels in addition to rateable value changes.

Commencement of the Sizewell C construction and other non-related energy projects does not appear to be having a detrimental impact on the leisure sector at this time. Upsides are starting to reach fruition due to the increased number of corporate guests entering the area providing off peak occupancy opportunities.

Total sales for year ending 30th September 2025 grew by 2.2%, a pleasing continuation of positive sales growth enjoyed in the prior financial year of 2.8%. Growth was driven by accommodation and golf revenues supported by strong occupancy and ADR in accommodation revenue.

Highlights include the continued growth at Thorpeness Golf Club and Hotel reflected by the investment in the Golf Course allowing increases in ADR and performance at The Brudenell which remains an important profit contributor to the Company. A change in leadership and direction at The Swan at Lavenham Hotel and Spa in the latter part of the year is starting to yield positive results.

Good performance and subsequent cash flows have allowed for capital investment with a further 9 hotel bedrooms refurbished in the year, predominately at The Swan and Thorpeness Golf Club. Combining this and the previous financial year, a total of 102 bedrooms have been refreshed, 52% of the total groups room stock.

Whilst liquor margins remained stable, food margins continued to improve by 0.7 percentage points versus the previous year, returning to previous levels. Other expenses remain in line with sales to cost ratios.

Our Net Promoter Score as measured through Guest Revu improved during the year. This improvement is attributed to the capital improvements made across our room stock and better service assisted by further investment in Training and Development.

Across the year, many IT investments were made to improve the guest experience and create efficiencies. Enhancements include changes to our payment gateway to ‘Guestpay’ allowing access to further Access Group products. Guests can now enjoy pre-check in, check out at their leisure reducing their reliance on reception staff. All hotel phone systems have been centralised into a call centre in Woodbridge improving guest experience and reducing reception teams in the hotels.

EPOS and stock systems were upgraded allowing Folk to take orders at table via tablets. Stock systems are also much more efficient and allow for a greater cashflow control and reduction in stock holding. A new Gift Voucher system was also introduced to improve the Guest Experience and drive sales opportunities at different occasions throughout the year.

Overall, the board remains pleased with the business improvements and remains confident about future trading.

The business continues to work with local and national media partners to promote the achievements of the hotels for the benefit of its guest and employees. Lobbying and contributing to business and economic surveys has been a key part of these activities, especially in light of the increasing costs faced by all hospitality businesses imposed by the Government.

Our Hotel Folk awards celebrate our Folks achievements across different award categories linked to our Company values. Congratulations went to Thorpeness Golf Club and Hotel for winning ‘Hotel of the Year’ whilst our Unity in Community, Leader of the Year went to our Reception Manager at The Brudenell, Katarina Easters. The Awards also gave the Company an opportunity to celebrate long service for 20 of our Folk celebrating 153 years’ service.

Across the Suffolk Coast there are various community and local groups we actively support including the Alde and Ore Estuary Trust, Suffolk Energy Action Solutions (SEAS) and through our CEO strong connections in promoting the Suffolk Coast through the Destination Management Organisation (DMO). Our Folk at The Swan have strong links with the local council and support various village and community events across the year, especially at Christmas time.

In addition, we are acutely aware of the current coastal erosion at Thorpeness. Thorpeness is our home, where our business originated and where our head office operations centre as well as the Golf and Country Club. We are actively involved and supportive of the lobbying and campaigning organisations.

As a local business and large employer within the county we take our relationships with our key partners very seriously. We work with local suppliers and promote Suffolk provenance whenever possible – we played an active role at the Aldeburgh Food and Drink Festival promoting local ingredients with food demonstrations from our chefs. Where possible we try and use local tradespeople to aid us in completing our investment projects.

On behalf of the board

The directors present their annual report and financial statements for the year ended 30 September 2025.

The principal activity of the company during the period was the operation of hotels and other leisure activities.

The results for the year are set out on page 11.

No ordinary dividends were paid. The directors do not recommend payment of a final dividend.

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

The company’s policy is to recruit disabled workers equally with able bodied workers when recruiting for all suitable vacancies. Arrangements are made, wherever possible, for retraining employees who become disabled, to enable them to perform work identified as appropriate to their aptitudes and abilities.

Employee numbers have remained consistent at 370 equating to approximately 220 Full Time Equivalents to 30th September 2024. The company employs a significant number of young people with 20.8% of Folk employed aged 21 or under as of September 2025 payroll. Numbers vary due to the seasonal nature of the business.

44.0% of all Folk employed are male, 56.0% female. Geographically the employees of the company live almost exclusively in Suffolk. During the year our focus on Training and Development remained, with a specific focus on all management positions.

Focus on Training and Development continued through 2024/25 with 184 new Folk, including seasonal workers attending the Company Induction. Our focus on accurate and timely induction continued into the hotels to strengthen the onboarding and training of all Folk.

Our Chef Development programme in partnership with HIT apprenticeship providers continued across the kitchens, and the programme has enrolled several trainees from across our hotels. Many chefs are completing differing levels of apprenticeships on the job and attending Suffolk Food Hall for culinary chef days each month, several chefs have successfully completed their apprenticeships with distinction grades.

We have also enrolled several Folk on other apprenticeships, L3 HR, L3 Front of House Supervisor, Greenkeeper and Maintenance Operative apprentices who are supported by HIT Hospitality, Suffolk New College and Otley College.

Our commitment to Staff Welfare is also highly important with all senior Executives being Mental Health First Aiders and Safeguarding trained.

Information and matters which are of concern to our Folk are given through information bulletins published on our group training portal ‘Folklore’ and on staff notice boards across all hotels. Currently 269 of 370 Folk are actively engaged in our company Facebook page whereby videos, photographs and company updates are regularly shared. Financial information and company performance is shared with the department leaders each week with month end financial and service updates shared each month utilising the communication methods referenced above.

The Company will continue its commitment to refurbishing its assets with a particular focus at The Swan at Lavenham, The White Lion and The Dolphin in Thorpeness.

The next financial year sees more IT improvements focusing on our Training and Development platform moving from Mapal to CPL to enhance our Folk’s training journey. We are also moving to Procure Wizard to further improve Food and Liquor margin and manage costs generally.

On 1 September 2025 our auditors, Ensors Accountants LLP, merged with Azets Audit Services Limited. Accordingly Ensors Accountants LLP formally resigned as the company’s auditors with the directors duly appointing Azets Audit Services Limited, trading as Ensors to fill the vacancy arising. The auditor, Azets Audit Services Limited, trading as Ensors, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

The scope of this energy and carbon report includes all The Hotel Folk activities financially controlled by the company during the compliance period. No energy types are excluded.

Reporting for the period 1 October 2024 - 30 September 2025:

During the financial year 100% of electricity supplied to The Hotel Folk (THF) portfolio is from 100% REGO Backed Renewable Zero Carbon Generation.

UK Government GHG Conversion Factors for Company Reporting 2025 were used to convert all energy units to kWh, all mileage units to kWh (Scope 3) and finally kWh to tCO2e.

Methodology

An evidence-based methodology was adopted in accordance with BS EN ISO 14064-3:2019, Section 4.3. Verifiable data has been collected from the following sources:

Energy Data:    

The energy data includes energy metering, invoices, supply summaries / statements, repayment claims for business mileage, fuel cards, and correspondence with suppliers.

Previous Audit Data:    

Previous compliance datasets including ESOS Phase 2 and 3, and the 2023–2024 SECR submission.

Emission Conversions:    

All greenhouse gas emissions have been calculated using the UK Government GHG Conversion Factors for Company Reporting (2025), in line with the reporting period which spans both 2024 and 2025.

Reporting Period:    

The SECR disclosure is for the financial year from 1st October 2024 to 30th September 2025, for inclusion in the annual accounts made up to 30th September 2025.

Intensity Ratio:    

The intensity metric is expressed as tonnes of CO₂e per £100,000 of turnover.

Grey Fleet:    

Scope 3 emissions for grey fleet mileage have been calculated based on mileage claims submitted during the financial year.

Third party verification:

The data compilation, quality assurance, and audit of this SECR disclosure were undertaken by TTL Consultants Limited t/a Hawley Energy.

Energy Efficiency Action

The Hotel Folk (THF) continues to invest in improvements to reduce energy consumption and carbon emissions across its portfolio resulting in a 64.1 tCO2e reduction in Gross Greenhouse Gas Emissions, 61 tCO2e was directly attributed to electricity use. Key actions during the reporting period include:

Renewable Energy:

THF procured 100% REGO‑backed renewable electricity for all sites throughout the reporting year, supporting ongoing efforts to reduce Scope 2 emissions.

Greenhouse Gas Emissions:

THF achieved an 8.3% reduction in carbon intensity compared with the 2023/24 reporting period, measured per £100,000 of revenue. This improvement spans Scope 1, Scope 2, and Scope 3 emissions despite increased annual turnover.

Automated Meter Reading (AMR):

All electricity supplies are now equipped with Automated Meter Reading (AMR). Although data visibility challenges remain for three P272 half‑hourly meters, further upgrades are planned, particularly for gas metering. Improved metering will enhance consumption visibility, enable better behavioural insights, and support evidence‑based decarbonisation planning.

LED Lighting Upgrades:

A rolling upgrade to LED lighting is underway across the estate. This is particularly significant in hospitality buildings, where lighting often represents 30–40% of total electricity consumption. Upgrades across public areas and guest rooms are nearing completion.

Boiler and Water Heating Upgrades:

During the reporting year, the main boiler at the White Lion Hotel was replaced, improving heating efficiency and reducing fuel‑related emissions.

Glazing Replacement:

Window replacements are progressing in line with conservation and planning requirements. New glazing units meet current Part L standards, improving thermal performance, reducing heat loss, and enhancing overall comfort levels.

Alternative Heating Systems (Crown and Castle Hotel):

Future improvements should consider alternative heating systems where propane, burning oil, and gas oil are used as primary fuels. ESOS Phase 3 identified the potential for biomass boilers or a Biomass Combined Heat and Power (CHP) unit at the Crown and Castle, which lacks access to a natural gas network. The Crown and Castle fuels accounted for 13.0% of all Scope 1 emissions, indicating significant potential for carbon dioxide reduction through biomass.

Greenkeeping Machinery:

Greenkeeping machinery (gas oil) accounted for 2.2% of Scope 1 emissions. Collectively, greenkeeping machinery and the grey fleet accounted for less than 2.3% of total emissions reported.

Ongoing Investments:

THF remains committed to investing in sustainable technologies and operational improvements. Under the revised ESOS Phase 3 requirements, THF will prepare and submit an Annual Action Plan to the MESOS system. This will serve as a structured framework for future carbon‑reduction initiatives and long‑term sustainability planning.

So far as the directors are aware, there is no relevant audit information of which the company's auditor are unaware. Additionally, the directors 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 company's auditors are aware of that information.

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

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with 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 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;

- state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;

- 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.

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 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;

• state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and

• 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.

We have audited the financial statements of The Hotel Folk Limited (the 'company') for the year ended 30 September 2025 which comprise the statement of comprehensive income, the statement of financial position, the statement of changes in equity, the 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 company's affairs as at 30 September 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 Auditor's 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 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 company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.

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

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

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

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

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

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 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.

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.

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

engagement team:

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

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

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

Our audit was designed to include tests of detail together with an assessment of the control environment to enable us to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement due to fraud. Through discussion with directors and management, and from our own knowledge of and experience of the sector in which the company operates we identified the following areas where we consider there is a higher risk of fraud: revenue recognition, and management override of systems and control. We note that the client has various internal controls in place to reduce the susceptibility of the company to material misstatement due to fraud.

We performed audit procedures to address the risks noted above, which included the following:

• Enquiry of management, those charged with governance and the entity’s solicitors around actual and potential litigation and claims

• Reviewing minutes of board meetings

• Testing journal entries and other adjustments for appropriateness, and evaluating the business rationale of significant transactions

There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is we would become aware of non-compliance. Material misstatements that arise due to fraud can be harder to detect that those that arise from error as they may involve deliberate concealment of collusion.

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

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.

The income statement has been prepared on the basis that all operations are continuing operations.

The Hotel Folk Limited is a private company limited by shares incorporated in England and Wales. The registered office is Thorpeness Golf Club, Lakeside Avenue, Thorpeness, Leiston, IP16 4NH.

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, modified to include investment properties at fair value. The principal accounting policies adopted are set out below.

The company being a parent, has taken exemption from consolidation under section 405 (2) of the Companies Act 2006. The inclusion of the subsidiaries is not material for the purpose of giving a true and fair view.

Turnover represents amounts receivable for goods and services net of VAT and trade discounts.

Room, catering and green fee revenue is recognised at the point of delivery.

Annual golf memberships fees and rental income is recognised on a pro-rata basis across the term of the contract.

Acquired goodwill is written off in equal annual instalments over its estimated useful economic life of five years.

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, 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:

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 credited or charged to profit or loss.

Investment property, which is property held to earn rentals and/or for capital appreciation, is initially recognised at cost, which includes the purchase cost and any directly attributable expenditure. Subsequently it is measured at fair value at the reporting end date. Changes in fair value are recognised in profit or loss.

Interests in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.

At each reporting period end date, the company 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.

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.

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 company 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 company's statement of financial position when the company becomes party to the contractual provisions of the instrument.

Financial assets and liabilities are offset, with 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 company 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 company 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.

Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.

Equity instruments issued by the company 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 company.

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 income statement 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 company’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 income statement, 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 when the company has 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 statement of financial position 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.

Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.

A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.

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 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 where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

Depreciation

The company estimates the rates of depreciation used to write down the different classes of assets the company owns. This is based on prior experience of asset lives while taking into account any additional circumstances. Once fully depreciated over its useful life the asset should be stated at its residual value or £Nil if there is no residual value.

Valuation of Investment Property

The valuation of investment property requires the use of significant judgement. Fair values are determined by independent valuers using recognised methodologies and observable market data where available. Key assumptions include market yields, rental income, occupancy levels and comparable market transactions. These estimates involve inherent uncertainty, and changes in underlying assumptions may result in material movements in the carrying value of investment property.

An analysis of the company's turnover is as follows:

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

Their aggregate remuneration comprised:

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 3 (2024 - 3).

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

Included within tangible fixed assets are assets held under finance leases or hire purchase contracts, as follows:

Freehold land and buildings with a carrying amount of £17,559,306 (2024 - £17,834,083) have been pledged to secure borrowings of the company. The company is not allowed to pledge these assets as security for other borrowings or to sell them to another entity.

Investment property comprises two properties held to earn rentals and/or capital appreciation. The fair value of the investment property has been arrived at by the directors on the basis of valuations carried out by an independent valuer, Cristie & Co on the 15th April 2025, and by reference to the original purchase price of the properties. The external valuation was made on an open market value basis by reference to market evidence of transaction prices for similar properties. The directors consider the valuation to be appropriate for the current year.

The loans and overdraft are secured by a first legal charge over the freehold properties of the company.

Finance lease payments represent rentals payable by the company for certain items of plant and machinery. No restrictions are placed on the use of the assets.

Deferred tax assets and liabilities are offset where the company has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:

The deferred tax liability in respect of accelerated capital allowances set out above is expected to reverse in line with the depreciation of tangible fixed assets. The deferred tax in respect of capital gains is expected to reverse when the associated properties are sold.

The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.

The merger reserve was created on the transfer of assets from Aldeburgh Hotels Limited on 1 April 2002.

At 30 September 2025, the Company had distributable reserves of £176,610.94 (2024: £496,794.75), calculated in accordance with the provisions of the Companies Act 2006.

These distributable reserves differ from the retained earnings reported in these financial statements due to items that are treated as non distributable under UK company law, including unrealised profits and other statutory restrictions.

During the financial year, the company entered into a refinancing agreement in respect of its bank borrowings. At the reporting date, this agreement included a scheduled repayment of £2,000,000 due to take place after the year end.

As this condition existed at the reporting date, the company did not have an unconditional right to defer settlement of the loan, and a related loan with the same lender, for at least 12 months. Accordingly, both loans have been classified as a current liability in the financial statements. This reflects an adjusting event under FRS 102, as the covenant position affects the appropriate classification of the liability at the reporting date.

Subsequent to the balance sheet date, the company obtained an unsecured, interest free loan of £2,000,000 from a director. The proceeds were used to settle the scheduled post year end repayment of the bank loan in line with the refinancing agreement.

In connection with this arrangement, the company also entered into a guarantee in respect of certain obligations of the director to a third party, limited to £1,500,000.

The director loan and the related guarantee are considered non adjusting events, as they arose after the reporting date. Accordingly, they have not been recognised in the financial statements for the year ended 30 September 2025 but are disclosed.

Key management are considered to be the directors of the company.

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

Other related parties are entities under common control or directorship. There is no direct significant influence between these entities and the Company.

The following amounts were outstanding at the reporting end date:

The following amounts were outstanding at the reporting end date:

The company is controlled by the MGH Heald 1993 Settlement.