Registered number: 14671962
FOR THE YEAR ENDED 31 DECEMBER 2025
COMPANY INFORMATION
CONTENTS
GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2025
The directors present their strategic report on the Group for the year ended 31 December 2025.
The Group continued to operate its portfolio of hotels, restaurants and bars. Turnover for the year was £3.92m (2024 - £2.90m), an increase of 35.4% on the prior year, reflecting higher average room rates and growth in Food and Beverage offerings and popularity. Gross profit rose to £2.84m (2024 - £1.93m) and the gross margin improved to 72.5% (2024 - 66.5%), as revenue growth outpaced the 11.1% increase in cost of sales.
Administrative expenses fell to £3.59m (2024 - £3.99m), a reduction of 10.1%. The operating loss reduced to £553,166 (2024 - £2.06m). The current year operating result includes a fair value gain of £190,699 on current asset investments (note 17); excluding this non-trading item the operating loss was £743,865. After interest receivable of £8,735 the loss before and after taxation was £544,434 (2024 - loss £2.02m).
Administrative expenses fell to £3.59m (2024 - £3.99m), a reduction of 10.1%. The operating loss reduced to £553,166 (2024 - £2.06m). The current year operating result includes a fair value gain of £190,699 on current asset investments (note 17); excluding this non-trading item the operating loss was £743,865. After interest receivable of £8,735 the loss before and after taxation was £544,434 (2024 - loss £2.02m).
The Group operates in the hospitality sector and is exposed to risks arising from changes in economic conditions, consumer confidence, tourism activity and discretionary spending patterns. Adverse economic conditions, inflationary pressures or reductions in visitor numbers could impact occupancy levels, food and beverage sales and overall profitability. The Directors monitor trading performance closely and regularly review pricing, operational performance and cost structures to support the long-term sustainability of the business.
The Group's success is dependent on maintaining high levels of customer satisfaction, service quality and operational performance. The hospitality sector continues to face challenges in attracting and retaining skilled employees, and any failure to maintain appropriate staffing levels could adversely affect service standards and guest experience. The Group seeks to mitigate these risks through investment in employee training and development, employee engagement initiatives and regular review of customer feedback and service standards.
The Group relies on its properties, systems and infrastructure to support day-to-day operations. Property damage, business interruption, technology failures or cybersecurity incidents could adversely impact trading performance and customer confidence. The Group maintains appropriate insurance cover, undertakes planned maintenance of its premises and utilises established technology providers with appropriate data protection and cybersecurity controls. The Directors regularly review the risks facing the business and consider appropriate mitigation measures to support the Group's continued resilience and growth.
The Group has net current liabilities of £16.55m and net liabilities of £5.54m at the reporting date. Current liabilities include £17.35m owed to undertakings under common control which is unsecured, interest free and repayable on demand. The Group is therefore dependent on the continued availability of that funding and on the continuing financial support of the ultimate controlling party. The ultimate controlling party has confirmed their ability and intention to provide financial support to the Group for at least twelve months from the date of approval of these financial statements, and the connected creditors have undertaken not to demand repayment where to do so would prejudice the Group's ability to meet its obligations as they fall due. The directors monitor cash flow forecasts regularly and, whilst these confirmations are not legally binding, consider the risk of that support being withdrawn to be low given the ultimate controlling party's long-standing commitment to the Group.
The Group's success is dependent on maintaining high levels of customer satisfaction, service quality and operational performance. The hospitality sector continues to face challenges in attracting and retaining skilled employees, and any failure to maintain appropriate staffing levels could adversely affect service standards and guest experience. The Group seeks to mitigate these risks through investment in employee training and development, employee engagement initiatives and regular review of customer feedback and service standards.
The Group relies on its properties, systems and infrastructure to support day-to-day operations. Property damage, business interruption, technology failures or cybersecurity incidents could adversely impact trading performance and customer confidence. The Group maintains appropriate insurance cover, undertakes planned maintenance of its premises and utilises established technology providers with appropriate data protection and cybersecurity controls. The Directors regularly review the risks facing the business and consider appropriate mitigation measures to support the Group's continued resilience and growth.
The Group has net current liabilities of £16.55m and net liabilities of £5.54m at the reporting date. Current liabilities include £17.35m owed to undertakings under common control which is unsecured, interest free and repayable on demand. The Group is therefore dependent on the continued availability of that funding and on the continuing financial support of the ultimate controlling party. The ultimate controlling party has confirmed their ability and intention to provide financial support to the Group for at least twelve months from the date of approval of these financial statements, and the connected creditors have undertaken not to demand repayment where to do so would prejudice the Group's ability to meet its obligations as they fall due. The directors monitor cash flow forecasts regularly and, whilst these confirmations are not legally binding, consider the risk of that support being withdrawn to be low given the ultimate controlling party's long-standing commitment to the Group.
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GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
The Directors use a range of financial key performance indicators (“KPIs”) to monitor the Group’s performance and financial position. Key measures include revenue, gross profit, EBITDA (earnings before interest, taxation, depreciation and amortisation), occupancy rates and food and beverage margins where relevant. Labour costs and cost of sales are also monitored to assess operational efficiency and support effective decision-making.
As a medium-sized group the Group has taken advantage of the exemption in section 414C(7) of the Companies Act 2006 from disclosing analysis using non-financial key performance indicators.
This report was approved by the board on 10 September 2026 and signed on its behalf.
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DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2025
The directors present their report and the financial statements for the year ended 31 December 2025.
The loss for the year, after taxation, amounted to £544,434 (2024 - loss £2,016,021).
The directors do not recommend payment of a dividend.
The directors who served during the year were:
There are no plans which will significantly change the activities and risks of the Group.
The Group's principal financial instruments comprise cash at bank and in hand of £318,073, current asset investments of £190,699, trade debtors of £49,327, trade creditors of £259,789 and amounts owed to undertakings under common control of £17.35m. The Group's policy is to manage liquidity risk by maintaining cash flow forecasts and by relying on the continuing support of its connected creditors, whose balances are interest free and repayable on demand. Credit risk is limited as the majority of sales are settled at the point of sale by cash or card; trade debtors are monitored and are not considered significant relative to turnover. The Group is exposed to price risk on its current asset investments, which are held at fair value and on which a gain of £190,699 was recognised in the year. Interest rate risk is minimal, the Group having no material interest-bearing borrowings.
There have been no significant events affecting the Group since the year end.
Under section 487(2) of the Companies Act 2006, Sopher + Co LLP will be deemed to have been reappointed as auditors 28 days after these financial statements were sent to members or 28 days after the latest date prescribed for filing the accounts with the registrar, whichever is earlier.
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DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
This report was approved by the board on 10 September 2026 and signed on its behalf.
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DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2025
The directors are responsible for preparing the Group Strategic Report, the Directors' Report and the consolidated 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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), 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 the Group and of the profit or loss of the Company and Group for that period.
In preparing these financial statements, the directors are required to:
∙select suitable accounting policies for the Group's financial statements and then apply them consistently;
∙make judgments and accounting estimates that are reasonable and prudent;
∙prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group 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 the Group and to 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 the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF FREUD HOSPITALITY GROUP LIMITED
We have audited the financial statements of Freud Hospitality Group Limited (the 'parent Company') and its subsidiaries (the 'Group') for the year ended 31 December 2025, which comprise the Group Statement of Comprehensive Income, the Group and Company Statements of Financial Position, the Group Statement of Cash Flows, the Group and Company Statement of Changes in Equity and the related notes, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).
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 Group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council'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.
In forming our opinion we have considered the adequacy of the disclosures concerning the preparation of the financial statements on a going concern basis set out in Note 2.3. In view of the significance of this matter we consider that it should be brought to your attention but our opinion is not qualified in this respect.
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 or the 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.
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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF FREUD HOSPITALITY GROUP LIMITED (CONTINUED)
The directors are responsible for the other information. The other information comprises the information included in the Annual Report, other than the financial statements and our Auditors' Report 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 there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
In our opinion, based on the work undertaken in the course of the audit:
∙the information given in the Group 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 Group 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 its environment obtained in the course of the audit, we have not identified material misstatements in the Group 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 set out on page 5, 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 Group's and the parent Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Group or the parent Company or to cease operations, or have no realistic alternative but to do so.
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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF FREUD HOSPITALITY GROUP LIMITED (CONTINUED)
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 Auditors' 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 Group financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:
Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:
∙the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;
∙we identified the laws and regulations applicable to the Group through discussions with directors and other management, and from our commercial knowledge and experience of the hotel and licensed restaurants sector;
∙we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the Group, including the Companies Act 2006, taxation legislation and data protection, anti-bribery, employment, environmental and health and safety legislation;
∙we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal correspondence; and
∙identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit.
We assessed the susceptibility of the Group’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:
∙making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud;
∙considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations; and
∙understanding the design of the Group’s remuneration policies.
To address the risk of fraud through management bias and override of controls, we:
∙performed analytical procedures to identify any unusual or unexpected relationships;
∙tested journal entries to identify unusual transactions;
∙assessed whether judgements and assumptions made in determining the accounting estimates were indicative of potential bias; and
∙investigated the rationale behind significant or unusual transactions.
In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:
∙agreeing financial statement disclosures to underlying supporting documentation;
∙reading the minutes of meetings of those charged with governance;
∙enquiring of management as to actual and potential litigation and claims; and
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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF FREUD HOSPITALITY GROUP LIMITED (CONTINUED)
∙reviewing correspondence with HMRC, relevant regulators and the Group’s legal advisors.
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 that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.
Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or 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 Auditors' Report.
The financial statements for the year ended 31 December 2024 have been presented as comparative information. These financial statements were not audited and accordingly we do not express an opinion on them. Our opinion is not modified in respect of this matter.
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 Auditors' 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.
for and on behalf of
Chartered Accountants
Statutory Auditors
5 Elstree Gate
Elstree Way
Borehamwood
Hertfordshire
WD6 1JD
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CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2025
Page 10
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2025
The financial statements were approved and authorised for issue by the board and were signed on its behalf on 10 September 2026.
The notes on pages 17 to 30 form part of these financial statements.
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COMPANY STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2025
The financial statements were approved and authorised for issue by the board and were signed on its behalf on 10 September 2026 .
The notes on pages 17 to 30 form part of these financial statements.
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CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2025
Page 13
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2025
Page 14
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2025
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CONSOLIDATED ANALYSIS OF NET DEBT
FOR THE YEAR ENDED 31 DECEMBER 2025
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
Freud Hospitality Group Limited is a private company, limited by shares, incorporated in England and Wales. Its business and registered office address is 1 Stephen Street, London, W1T 1AL.
The principal activity of the Group is the operation of hotels, restaurants and bars.
The principal activity of the Group is the operation of hotels, restaurants and bars.
2.Accounting policies
The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires Group management to exercise judgment in applying the Group's accounting policies (see note 3).
These are the first consolidated financial statements prepared by the Group. In the preceding period, the Group qualified as a small group for the purposes of section 383 of the Companies Act 2006 and accordingly took advantage of the exemption from preparing consolidated financial statements available under section 399(2A) of that Act. The Group no longer meets the conditions for the small group exemption and is therefore required by section 399 of the Companies Act 2006 to prepare consolidated financial statements for the year ended 31 December 2025. The consolidated financial statements incorporate the results, assets and liabilities of Freud Hospitality Group Limited and all its subsidiary undertakings.
The following principal accounting policies have been applied:
On 3 July 2023 the Company was established as the new ultimate parent company of the Group following a restructuring of the group previously headed by Freud 3.0 Limited. As part of that restructuring the entities disclosed in Note 14, which had previously been subsidiaries of Freud 3.0 Limited, were transferred to the Company.
No consideration was paid by the Company in connection with the restructuring. Throughout the restructuring and at all times prior to it, the ultimate controlling party was M Freud, and accordingly there was no change in ultimate control of any of the entities transferred.
In accordance with FRS 102, the directors have accounted for the group reconstruction using the merger method. Under this method the assets and liabilities of each entity are recognised at their pre-combination carrying amounts, without fair value adjustments. No goodwill arises on consolidation as a result of the restructuring itself and the consolidated financial statements present the results of the Company and all subsidiaries as if they had always formed a single group. The comparative financial information for the year ended 31 December 2024 has been prepared on the same basis and includes the results and financial position of all entities transferred for the full comparative year.
No consideration was paid by the Company in connection with the restructuring. Throughout the restructuring and at all times prior to it, the ultimate controlling party was M Freud, and accordingly there was no change in ultimate control of any of the entities transferred.
In accordance with FRS 102, the directors have accounted for the group reconstruction using the merger method. Under this method the assets and liabilities of each entity are recognised at their pre-combination carrying amounts, without fair value adjustments. No goodwill arises on consolidation as a result of the restructuring itself and the consolidated financial statements present the results of the Company and all subsidiaries as if they had always formed a single group. The comparative financial information for the year ended 31 December 2024 has been prepared on the same basis and includes the results and financial position of all entities transferred for the full comparative year.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
2.Accounting policies (continued)
The Group made a loss of £544,434 (2024 - £2,016,021) for the year and at the reporting date had current liabilities of £16,554,429 (2024 - £15,906,666) and net liabilities of £5,539,833 (2024 - £4,995,399). The Company has net current liabilities and net liabilities of £3 (2024 - £3). The ultimate controlling party, M Freud, who is also a director of the Company, has confirmed that he has the ability and will financially support the Group as and when required so that the Group will be able to continue to meet its financial obligations as and when they fall due for at least twelve months from the date the financial statements are approved.
Furthermore, the Company's connected creditors have confirmed their ongoing financial support and have undertaken not to demand repayment of amounts due where they would adversely affect the Company's ability to meet its obligations as they fall due.
Therefore, the directors believe that preparing the financial statements as a going concern is appropriate, and they are satisfied over the Group's and Company's ability to continue as such.
Furthermore, the Company's connected creditors have confirmed their ongoing financial support and have undertaken not to demand repayment of amounts due where they would adversely affect the Company's ability to meet its obligations as they fall due.
Therefore, the directors believe that preparing the financial statements as a going concern is appropriate, and they are satisfied over the Group's and Company's ability to continue as such.
Revenue for accommodation is recognised in the period to which it relates, amounts received in advance are carried forward as deferred income. Revenue from the sales of food and drinks is recognised at the point of sale.
Rent from short term let is recognised in the period to which it relates and amounts received in advance are carried forward as deferred income.
The Group contributes to a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Group pays fixed contributions into a separate entity. Once the contributions have been paid the Group has no further payment obligations.
The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Statement of Financial Position. The assets of the plan are held separately from the Group in independently administered funds.
The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Statement of Financial Position. The assets of the plan are held separately from the Group in independently administered funds.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
2.Accounting policies (continued)
The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date.
Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the reporting date, except that:
a) The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and
b) Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.
Deferred tax balances are not recognised in respect of permanent differences. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.
Goodwill
Goodwill represents the difference between amounts paid on the cost of a business combination and the fair value of identifiable assets and liabilities acquired at the date of acquisition. Subsequent to initial recognition, goodwill is measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is amortised on a straight-line basis to the Statement of Comprehensive Income over its useful economic life of 10 years.
Trademarks
Trademarks are initially recognised at cost. After recognition, under the cost model, they are remeasured at cost less any accumulated amortisation and any accumulated impairment losses. Trademarks are amortised on a straight-line basis to the Statement of Comprehensive Income over their useful economic life of 5 years.
Goodwill represents the difference between amounts paid on the cost of a business combination and the fair value of identifiable assets and liabilities acquired at the date of acquisition. Subsequent to initial recognition, goodwill is measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is amortised on a straight-line basis to the Statement of Comprehensive Income over its useful economic life of 10 years.
Trademarks
Trademarks are initially recognised at cost. After recognition, under the cost model, they are remeasured at cost less any accumulated amortisation and any accumulated impairment losses. Trademarks are amortised on a straight-line basis to the Statement of Comprehensive Income over their useful economic life of 5 years.
At each reporting date the Group assesses whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined which is the higher of its fair value less costs to sell and its value in use. An impairment loss is recognised where the carrying amount exceeds the recoverable amount.
The Group adds to the carrying amount of an item of fixed assets the cost of replacing part of such an item when that cost is incurred, if the replacement part is expected to provide incremental future benefits to the Group. The carrying amount of the replaced part is derecognised. Repairs and maintenance are charged to profit or loss during the period in which they are incurred.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
2.Accounting policies (continued)
Depreciation is provided on the following basis:
Assets under construction have not been depreciated. The residual value of artwork, which is included in furniture and equipment, is expected to be at least the same as cost and therefore not depreciated.
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date. Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in the Statement of Comprehensive Income.
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date. Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in the Statement of Comprehensive Income.
Other than investments in listed shares, which are measured at fair value (Note 2.12), the Group only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans to and from related parties.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
Key sources of estimation uncertainty
Tangible and intangible assets
The Group reviews its tangible and intangible assets for impairment when there are indications that their carrying value may not be recoverable. This assessment requires estimates of future cash flows, useful lives, and residual values. Changes in these assumptions could affect the carrying value of assets.
The estimation of useful economic lives and residual values of tangible and intangible assets requires judgement and is reviewed annually. Changes in expected usage, technological developments or market conditions could lead to revisions to depreciation or amortisation charges in future periods.
The whole of the turnover is attributable to the Group's principal activity and arose in the United Kingdom.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
Page 22
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
At the reporting date, the Group had unused tax losses of £4.74m (2024 - £3.91m) available for offset against future taxable profits. No deferred tax asset has been recognised in respect of these losses due to uncertainty over the timing and extent of their future utilisation.
The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of Comprehensive Income in these financial statements. The profit after tax of the parent Company for the year was £Nil (2024 - loss £13).
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
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Page 25
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
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Page 26
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
Page 27
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
Page 28
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
Profit and loss account
The Group operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the Group in an independently administered fund. The pension cost charge represents contributions payable by the Group to the fund and amounted to £21,590 (2024 - £19,975). Contributions totalling £5,884 (2024 - £2,334) were payable to the fund at the reporting date and are included in creditors.
Page 29
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
M Freud is the ultimate controlling party by virtue of his shareholding.
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