Year Ended
Registration number:
Hotel Operations Limited
Contents
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Company Information |
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Strategic Report |
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Directors' Report |
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Statement of Directors' Responsibilities |
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Independent Auditor's Report |
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Consolidated Statement of Income and Retained Earnings |
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Consolidated Balance Sheet |
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Balance Sheet |
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Consolidated Statement of Changes in Equity |
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Statement of Changes in Equity |
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Consolidated Statement of Cash Flows |
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Notes to the Financial Statements |
Hotel Operations Limited
Company Information
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Directors |
C W McLaughlin J J Nel J Thornton J Labbe |
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Registered office |
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Auditors |
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Hotel Operations Limited
Strategic Report
Year Ended 31 January 2026
The directors present their strategic report for the year ended 31 January 2026.
Principal activity
The principal activity of the group is the operation of the Jesmond Dene House Hotel.
We operate from an enviable collection, almost in the country yet still in the city.
Fair review of the business
The group experienced a 3% decrease in turnover in 2026 compared to the previous year.
During the period, net assets increased by £233,437 (2025 - £86,749) , reflecting the continued growth and financial performance of the group.
The profit before tax was £228,837 for the year compared to £155,031 in the prior period.
The business activities are constantly reviewed to ensure the appropriate balance of qualitative and commercial factors is maintained in line with the expectations of our market.
The group continues to consider opportunities to expand the existing business with complementary activities e.g. a Spa and/or additional bedrooms and continues to develop these. In addition, the group continues to enhance the quality of the Management Team, which is expected to further enhance the reputation and quality of the offering.
The group's key financial and other performance indicators during the year were as follows:
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Financial KPIs |
Unit |
2026 |
2025 |
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Turnover movement |
% |
(3) |
(4) |
|
Gross profit margin |
% |
40 |
38 |
Hotel Operations Limited
Strategic Report
Year Ended 31 January 2026
Principal risks and uncertainties
The management of the business and the execution of the group's strategy are subject to a number of risks. The board review these risks and put in place policies to mitigate them.
Utilities
Since acquisition we have secured new gas and electricity contracts at much lower rates. The electricity contract was effective from April 2025 and the gas contract has been in effect from October 2024.
The resulting impact of this has been a reduction in light, heat and power expenditure by 30% in the prior period.
Employees and employee costs
The group's performance depends largely upon its employees and the resignation of a key employee could potentially adversely affect the business. There remains significant pressure on staffing in the Hospitality sector and a wide-range of measures are deployed to attract and retain employees in what has become an increasingly competitive area in recent years; this is expected to continue.
The increase in minimum wages and national insurance contributions poses a big challenge to manage staff costs within appropriate bounds.
Environment, health and safety incidents
Appropriate measures are implemented to ensure the risk of any environmental and health and safety issues are minimised.
Interest rate risk
The group monitors credit risk and consider that its current policy meets its objectives of managing its exposure. This has become yet more pertinent given recent significant increases in the rate of UK inflation.
Liquidity risk
The directors regularly monitor the financial information to ensure that any risks in this area are considered on a timely basis.
Approved and authorised by the
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Hotel Operations Limited
Directors' Report
Year Ended 31 January 2026
The directors present their report and the for the year ended 31 January 2026.
Directors of the group
The directors who held office during the year were as follows:
The following director was appointed after the year end:
Financial instruments
Objectives and policies
The group finances its activities with a combination of shareholders loans, finance leases and hire purchase contracts, cash and short term deposits. Other financial assets and liabilities, such as trade debtors and trade creditors, arise directly from the Group's operating activities.
Price risk, credit risk, liquidity risk and cash flow risk
Price risk
The company operates a set tariff for customers staying at the hotel. The tariff is set by the Directors and regularly reviewed in order to ensure that the price is appropriate. The deposits received in advance help fund the company and therefore setting tariffs to ensure that they encourage payments in advance is an important element in assisting cash flow.
Credit risk
Credit risk is the risk that one party of a financial instrument will cause a financial loss for the other party by failing to discharge its obligation. Group policies are aimed at minimising such losses. The group does not consider that it is materially exposed to credit risk.
Cash flow and liquidity risk
Cash flow and liquidity risk is the risk that a group's available cash will not be sufficient to meet its financial obligations with a dependency on the bank and shareholders. The group actively manages its cash flow position including collection of debts and timely payment of creditors. The group consider this is sufficient to minimise the group's exposure to cash flow and liquidity risk.
Hotel Operations Limited
Directors' Report
Year Ended 31 January 2026
Disclosure of information to the auditor
Each director has taken steps that they ought to have taken as a director in order to make themselves aware of any relevant audit information and to establish that the company's auditor is aware of that information. The directors confirm that there is no relevant information that they know of and of which they know the auditor is unaware.
Approved and authorised by the
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Hotel Operations Limited
Statement of Directors' Responsibilities
The directors acknowledge their responsibilities for preparing the Annual Report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the group and the company and of the profit or loss of the group for that period. In preparing these financial statements, the directors are required to:
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select suitable accounting policies and apply them consistently; |
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make judgements and accounting estimates that are reasonable and prudent; |
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state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and |
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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 group's and the company's transactions and disclose with reasonable accuracy at any time the financial position of the group and 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 group and the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Hotel Operations Limited
Independent Auditor's Report to the Members of Hotel Operations Limited
Opinion
We have audited the financial statements of Hotel Operations Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 January 2026, which comprise the Consolidated Statement of Income and Retained Earnings, Consolidated Balance Sheet, Balance Sheet, Consolidated Statement of Changes in Equity, Statement of Changes in Equity, Consolidated Statement of Cash Flows, and 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 group's and the parent company's affairs as at 31 January 2026 and of the group's profit for the year then ended; |
• | have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and |
• | have been prepared in accordance with the requirements of the Companies Act 2006. |
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the auditor responsibilities for the audit of the financial statements section of our report. We are independent of the group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the director's 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 and parent company's ability to continue as a going concern for a period of at least twelve months from when the original financial statements were 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 included in the annual report, other than the financial statements and our auditor’s 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.
Hotel Operations Limited
Independent Auditor's Report to the Members of Hotel Operations Limited
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.
Opinion on other matter prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
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the information given in the Strategic Report and Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
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the Strategic Report and Directors' Report have been prepared in accordance with applicable legal requirements. |
Matters on which we are required to report by exception
In the light of our 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 and the Directors' Report.
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:
• adequate accounting records have not been kept 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.
Responsibilities of directors
As explained more fully in the Statement of Directors' Responsibilities set out on page 6, 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.
Hotel Operations Limited
Independent Auditor's Report to the Members of Hotel Operations Limited
Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect
of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed as follows:
The objectives of our audit, in respect to fraud, are: to identify and assess the risks of material misstatement of the financial statements due to fraud; to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud, through designing and implementing appropriate responses; and to respond appropriately to fraud or suspected fraud identified during the audit. However, the primary responsibility for the prevention and detection of fraud rests with both those charged with governance of the company and management.
We obtained an understanding of the legal and regulatory frameworks that are applicable to the Company at the planning stage of the audit. Firstly, the company is subject to laws and regulations
that directly affect the financial statements including financial reporting legislation (including related company legislation) and taxation legislation and we assessed the extent of compliance with these
laws and regulations as part of our procedures on the related financial statement items. Secondly, the company is subject to other laws and regulations where the consequences of non-compliance could
have a material effect on amounts or disclosures in the financial statements, for instance through the imposition of fines or litigation or the loss of the company’s licence to operate. In making this
assessment we determined that the most significant elements of legislation including GDPR insofar that it pertains to guest information, food standards and licencing laws and employment laws and
regulations.
Based on this understanding we designed our audit procedures to identify non-compliance with such laws and regulations. Our procedures involved the following:
• Enquiries of management regarding their knowledge of any non compliance with laws and regulations that could affect the financial statements. As part of these enquiries we also discussed
with management whether there have been any known instances, allegations or suspicions of fraud.
• Discussing with staff how guest information is handled.
Hotel Operations Limited
Independent Auditor's Report to the Members of Hotel Operations Limited
We also evaluated the risk of fraud through management override including that arising from management’s incentives. The key risks we identified were with regards to the cut off of recognition of
income or through management bias in selecting accounting estimates. In response to the identified risk, as part of our audit work we:
• Used data analytics to test journal entries throughout the year, for appropriateness;
• Undertook a proof in total of the revenue recognised in the financial statements to the booking systems used by the company.
• Reviewed estimates and judgements made in the accounts for any indication of bias and challenged assumptions used by management in making the estimates.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements. 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 omissions, collusion, forgery, misrepresentations, or the override of internal controls. We are also less likely to become aware of instances of non-compliance with laws and regulations that are not closely related to events and transactions reflected in the financial statements.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.
Use of our report
This report is made solely to the company’s 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.
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Lowin House
Tregolls Road
Cornwall
TR1 2NA
Hotel Operations Limited
Consolidated Statement of Income and Retained Earnings for the Year Ended 31 January 2026
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Note |
31 January |
31 January |
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Turnover |
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|
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Cost of sales |
( |
( |
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Gross profit |
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|
|
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Administrative expenses |
( |
( |
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Other operating income |
|
- |
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Operating profit |
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|
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Interest payable and similar charges |
( |
( |
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Profit before tax |
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Taxation |
|
( |
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Profit for the financial year |
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|
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Profit/(loss) attributable to: |
|||
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Owners of the company |
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Retained earnings brought forward |
519,984 |
446,004 |
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Retained earnings carried forward |
753,421 |
519,984 |
There are no unrecognised gains or losses for the year apart from as stated above.
Hotel Operations Limited
Consolidated Balance Sheet
31 January 2026
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Note |
2026 |
2025 |
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Fixed assets |
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Tangible assets |
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Current assets |
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Stocks |
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Debtors |
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Cash at bank and in hand |
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||
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Creditors: Amounts falling due within one year |
( |
( |
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Net current liabilities |
( |
( |
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Net assets |
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Capital and reserves |
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Called up share capital |
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Share premium reserve |
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Profit and loss account |
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Equity attributable to owners of the company |
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Shareholders' funds |
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Approved and authorised by the
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Company Registration Number: 05175353
Hotel Operations Limited
Balance Sheet
31 January 2026
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Note |
2026 |
2025 |
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Fixed assets |
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Tangible assets |
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Investments |
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Current assets |
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Debtors |
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Cash at bank and in hand |
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Creditors: Amounts falling due within one year |
( |
( |
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Net current liabilities |
( |
( |
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Net assets |
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Capital and reserves |
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Called up share capital |
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Share premium reserve |
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Profit and loss account |
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Shareholders' funds |
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The company has taken the exemption in section 408 of the Companies Act 2006 and has not presented its individual profit and loss account. The company made a profit after tax for the financial year of £327,687 (2025 - profit of £73,540).
Approved and authorised by the
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Company Registration Number: 05175353
Hotel Operations Limited
Consolidated Statement of Changes in Equity
Year Ended 31 January 2026
|
Share capital |
Share premium |
Profit and loss account |
Total |
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At 1 February 2025 |
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|
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Profit for the year |
- |
- |
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At 31 January 2026 |
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Share capital |
Share premium |
Profit and loss account |
Total |
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At 1 February 2024 |
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- |
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Profit for the year |
- |
- |
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New share capital subscribed |
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- |
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At 31 January 2025 |
113 |
67,628 |
519,984 |
587,725 |
Hotel Operations Limited
Statement of Changes in Equity
Year Ended 31 January 2026
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Share capital |
Share premium |
Profit and loss account |
Total |
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At 1 February 2025 |
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Profit for the year |
- |
- |
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At 31 January 2026 |
|
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Share capital |
Share premium |
Profit and loss account |
Total |
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At 1 February 2024 |
|
- |
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Profit for the year |
- |
- |
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New share capital subscribed |
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|
- |
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At 31 January 2025 |
113 |
67,628 |
1,389,380 |
1,457,121 |
Hotel Operations Limited
Consolidated Statement of Cash Flows
Year Ended 31 January 2026
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Note |
31 January |
31 January |
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Cash flows from operating activities |
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Profit for the year |
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Adjustments to cash flows from non-cash items |
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Depreciation and amortisation |
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Finance costs |
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Income tax expense |
( |
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Working capital adjustments |
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(Increase)/decrease in stocks |
( |
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Increase in trade debtors |
( |
( |
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Decrease in trade creditors |
( |
( |
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Increase in provisions |
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Cash generated from operations |
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Income taxes received/(paid) |
|
( |
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Net cash flow from operating activities |
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Cash flows from investing activities |
|||
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Acquisitions of tangible assets |
( |
- |
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Cash flows from financing activities |
|||
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Interest paid |
( |
( |
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Proceeds from issue of ordinary shares, net of issue costs |
- |
|
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Net cash flows from financing activities |
( |
( |
|
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Net (decrease)/increase in cash and cash equivalents |
( |
|
|
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Cash and cash equivalents at 1 February |
|
|
|
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Cash and cash equivalents at 31 January |
51,530 |
131,535 |
|
Hotel Operations Limited
Notes to the Financial Statements
Year Ended 31 January 2026
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General information |
The company is a private company limited by share capital, incorporated in England and Wales.
The address of its registered office is:
These financial statements were authorised for issue by the
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Accounting policies |
Summary of significant accounting policies and key accounting estimates
The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.
Statement of compliance
These financial statements were prepared in accordance with Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland'.
Basis of preparation
These financial statements have been prepared using the historical cost convention except that as disclosed in the accounting policies certain items are shown at fair value.
FRS102 allows a qualifying entity certain disclosure exemptions, which the company has taken advantage of:
(i) From preparing a statement of cash flows, on the basis that it is a qualifying entity and the consolidated statement of cash flows included in these financial statements includes the Company's
cash flows;
(ii) From the financial instrument disclosures, required under FRS102 paragraphs 11.39 to 11.48A as the information is provided in the consolidated financial statement disclosures.
(iii) The requirements of Section 33 Related Party Disclosures paragraph 33.7.
The group has also taken advantage of the exemption under FRS102 paragraph 33.1A in respect of transactions between members of the group, on the basis that the group companies are 100% owned.
Hotel Operations Limited
Notes to the Financial Statements
Year Ended 31 January 2026
Basis of consolidation
The consolidated financial statements consolidate the financial statements of the company and its subsidiary undertakings drawn up to 31 January 2026.
As a consolidated profit and loss account is published, a separate profit and loss account for the parent company is omitted from the group financial statements by virtue of section 408 of the Companies Act 2006.
A subsidiary is an entity controlled by the company. Control is achieved where the company has the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities.
The results of subsidiaries acquired or disposed of during the year are included in the Profit and Loss Account from the effective date of acquisition or up to the effective date of disposal, as appropriate. Where necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with those used by the group.
The purchase method of accounting is used to account for business combinations that result in the acquisition of subsidiaries by the group. The cost of a business combination is measured as the fair value of the assets given, equity instruments issued and liabilities incurred or assumed at the date of exchange, plus costs directly attributable to the business combination. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. Any excess of the cost of the business combination over the acquirer’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities recognised is recorded as goodwill.
Inter-company transactions, balances and unrealised gains on transactions between the company and its subsidiaries, which are related parties, are eliminated in full.
Intra-group losses are also eliminated but may indicate an impairment that requires recognition in the consolidated financial statements.
Hotel Operations Limited
Notes to the Financial Statements
Year Ended 31 January 2026
Adoption of new and revised Financial Reporting Standards (FRS102)
The Financial Reporting Council (FRC) has introduced significant amendments to FRS 102, effective for accounting periods beginning on or after 1 January 2026, with early adoption permitted. These changes, stemming from the 2024 periodic review, aim to align UK and Ireland Generally Accepted
Accounting Practice (GAAP) more closely with international standards.
After due consideration the Directors have not chosen to early adopt the requirements of FRS102. The areas that have been reviewed as a potential change to the financial statements are as follows:
Revised revenue accounting requirements in FRS 102 and FRS 105, based on the IFRS 15 five-step model for revenue recognition, with appropriate simplifications;
Revised lease accounting requirements in FRS 102 based on the IFRS 16 'on-balance sheet' model,
again with appropriate simplifications.
The Directors are assessing the impact of the amendment to the accounting standard, which will be reflected in the financial statements to 31 January 2027, however do not anticipate that this will be material.
Hotel Operations Limited
Notes to the Financial Statements
Year Ended 31 January 2026
Going concern
At the balance sheet date the group had net current liabilities of £4,936,528 (2025 - £5,275,681) and net assets of £821,162 (2025 - £587,725). Included in current liabilities is £4,623,180 (2025 - £5,017,656) due to Kronen Hotels Ltd, the parent company. Kronen Hotels Ltd have confirmed that they do not require repayment of this balance within the next 12 months from the balance sheet date.
The group is party to a composite guarantee provided to NatWest Bank with the total outstanding balance of £14,405,732 (2025 - £14,364,500) at the year end.
The group's ability to continue as a going concern is dependent upon both the ongoing support of its bankers and its shareholders. However, in the event that this is not forthcoming then a material uncertainty would exist with regards to the appropriateness of the going conern assertion.
After due consideration the Directors continue to apply the going concern basis to the preparation of the financial statements.
Revenue recognition
Turnover represents amounts chargeable, net of value added tax, in respect of the sale of goods and services to customers.
Accommodation revenue is recognised at the point of the customer staying in the room. Deposits received in advance of customer stays are treated as payments on account and recognised within creditors due within one year.
Food, beverage and other income is recognised at the point of sale.
Tax
Tax is recognised in profit or loss, except that a change attributable to an item of income or expense recognised as other comprehensive income is also recognised directly in other comprehensive income.
The current corporation tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the group operates and generates taxable income.
Deferred tax is recognised on all timing differences at the balance sheet date unless indicated below. Timing differences are differences between taxable profits and the results as stated in the consolidated profit and loss account and other comprehensive income. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.
The carrying amount of deferred tax assets are reviewed at each reporting date and a valuation allowance is set up against deferred tax assets so that the net carrying amount equals the highest amount that is more likely than not to be recovered based on current or future taxable profit.
Tangible assets
Tangible assets are stated in the balance sheet at cost, less any subsequent accumulated depreciation and subsequent accumulated impairment losses.
The cost of tangible assets includes directly attributable incremental costs incurred in their acquisition and installation.
Hotel Operations Limited
Notes to the Financial Statements
Year Ended 31 January 2026
Depreciation
Depreciation is charged so as to write off the cost of assets, other than land and properties under construction over their estimated useful lives, as follows:
|
Asset class |
Depreciation method and rate |
|
Plant and machinery |
15% reducing balance |
|
Fixtures, fittings and equipment |
15% reducing balance & 33% straight line |
|
Freehold property |
Not depreciated |
Freehold property is not depreciated on the basis that it's residual value is considered to be in excess of NBV.
Goodwill
Goodwill is amortised over its useful life, which shall not exceed ten years if a reliable estimate of the useful life cannot be made.
Amortisation
Amortisation is provided on intangible assets so as to write off the cost, less any estimated residual value, over their useful life as follows:
|
Asset class |
Amortisation method and rate |
|
Goodwill |
20% straight line |
|
Website costs |
20% straight line |
Investments
Investments are recognised at cost less impairment.
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost is determined using the first-in, first-out (FIFO) method.
Defined contribution pension obligation
A defined contribution plan is a pension plan under which fixed contributions are paid into a pension fund and the group has no legal or constructive obligation to pay further contributions even if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods.
Contributions to defined contribution plans are recognised as employee benefit expense when they are due. If contribution payments exceed the contribution due for service, the excess is recognised as a prepayment.
Hotel Operations Limited
Notes to the Financial Statements
Year Ended 31 January 2026
Financial instruments
Classification
• Short term trade and other debtors and creditors;
• Intercompany loans; and
• Cash and bank balances.
All financial instruments are classified as basic.
Recognition and measurement
Financial instruments are recognised when the group becomes party to the contractual provisions of the instrument and derecognised when in the case of assets, the contractual rights to cash flows from the assets expire or substantially all the risks and rewards of ownership are transferred to another party, or in the case of liabilities, when the group's obligations are discharged, expire or are cancelled.
Such instruments are initially measured at transaction price, including transaction costs, and are subsequently carried at the undiscounted amount of the cash or other consideration expected to be paid or received, after taking account of impairment adjustments.
Hotel Operations Limited
Notes to the Financial Statements
Year Ended 31 January 2026
Critical judgements and estimation uncertainty
In applying the Group and 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.
The following areas are where the Directors have applied judgement in the preparation of the financial statements:
Going concern
The key judgements made by the Directors with regards to the appropriateness of the going concern assertion are as outlined in the above accounting policy.
The following are regarded by the Directors as key areas of estimation:
Carrying value of fixed assets (note 12)
Management have carefully considered the depreciation estimates applied on the tangible assets held by the group and company. This assessment is performed on an annual basis and would be amended when necessary to reflect current estimates based on technological advancements, future investments, economic utilisation and physical condition of each asset. The directors have considered the current trading performance for the year to 31 January 2026 which does not indicate any impairment to the business or underlying assets.
The carrying value of tangible fixed assets at the balance sheet date is £5,412,211 (2025 - £5,358,575), with depreciation being recognised in the year of £72,551 (2025 - £63,265).
This includes £5,000,000 relating to freehold property, which the directors believe to be a reasonable value. Depreciation is not provided for on the basis that the residual value is considered to be in excess of net book value.
Recognition of deferred tax asset (note 10)
As outlined in a separate note the group and company has carried forward tax losses available to utilise in future periods. A deferred tax asset has been recognised on the basis that the losses will be utilised within the group in subsequent accounting periods.
Hotel Operations Limited
Notes to the Financial Statements
Year Ended 31 January 2026
|
Turnover |
The analysis of the group's Turnover for the year from continuing operations is as follows:
|
31 January |
31 January |
|
|
Sale of goods |
|
|
|
Rendering of services |
|
|
|
|
|
The analysis of the group's Turnover for the year by market is as follows:
|
31 January |
31 January |
|
|
UK |
|
|
|
Other operating income |
The analysis of the group's other operating income for the year is as follows:
|
31 January |
31 January |
|
|
Miscellaneous other operating income |
|
- |
Hotel Operations Limited
Notes to the Financial Statements
Year Ended 31 January 2026
|
Operating profit |
Arrived at after charging/(crediting)
|
31 January |
31 January |
|
|
Depreciation expense |
|
|
|
Staff costs |
The aggregate payroll costs (including directors' remuneration) were as follows:
|
31 January |
31 January |
|
|
Wages and salaries |
|
|
|
Social security costs |
|
|
|
Pension costs, defined contribution scheme |
|
|
|
Other employee expense |
|
|
|
|
|
The average number of persons employed by the group (including directors) during the year, analysed by category was as follows:
|
31 January |
31 January |
|
|
Administration and support |
|
|
|
Other departments |
|
|
|
|
|
Hotel Operations Limited
Notes to the Financial Statements
Year Ended 31 January 2026
|
Directors' remuneration |
The directors' remuneration for the year was as follows:
|
31 January |
31 January |
|
|
Remuneration |
|
|
|
Contributions paid to money purchase schemes |
|
- |
|
67,886 |
54,577 |
|
Auditor's remuneration |
|
31 January |
31 January |
|
|
Audit of these financial statements |
5,500 |
3,000 |
|
Audit of the financial statements of subsidiaries of the company pursuant to legislation |
9,500 |
- |
|
|
|
|
Interest payable and similar expenses |
|
31 January |
31 January |
|
|
Interest expense on other finance liabilities |
|
|
Hotel Operations Limited
Notes to the Financial Statements
Year Ended 31 January 2026
|
Taxation |
Tax charged/(credited) in the consolidated profit and loss account
|
31 January |
31 January |
|
|
Current taxation |
||
|
UK corporation tax |
( |
( |
|
Deferred taxation |
||
|
Arising from origination and reversal of timing differences |
|
|
|
Arising from previously unrecognised tax loss, tax credit or temporary difference of prior periods |
- |
(35,925) |
|
Total deferred taxation |
|
|
|
Tax (receipt)/expense in the income statement |
( |
|
The tax on profit before tax for the year is higher than the standard rate of corporation tax in the UK (2025 - the same as the standard rate of corporation tax in the UK) of
The differences are reconciled below:
|
31 January |
31 January |
|
|
Profit before tax |
|
|
|
Corporation tax at standard rate |
|
|
|
Effect of expense not deductible in determining taxable profit (tax loss) |
- |
|
|
Decrease from tax losses for which no deferred tax asset was recognised |
( |
( |
|
Total tax (credit)/charge |
( |
|
Hotel Operations Limited
Notes to the Financial Statements
Year Ended 31 January 2026
Deferred tax
Group
Deferred tax assets and liabilities
|
2026 |
Asset |
Liability |
|
Accelerated tax depreciation |
- |
|
|
Provisions |
|
- |
|
Tax losses carry-forwards |
|
- |
|
|
|
|
2025 |
Asset |
Liability |
|
Accelerated tax depreciation |
- |
|
|
Provisions |
|
- |
|
Tax losses carry-forwards |
|
- |
|
|
|
Company
Deferred tax assets and liabilities
|
2025 |
Asset |
Liability |
|
Accelerated tax depreciation |
|
- |
|
Tax losses carry-forwards |
|
- |
|
|
- |
Hotel Operations Limited
Notes to the Financial Statements
Year Ended 31 January 2026
|
Intangible assets |
Group
|
Goodwill |
Trademarks, patents and licenses |
Total |
|
|
Cost or valuation |
|||
|
At 1 February 2025 |
|
|
|
|
At 31 January 2026 |
|
|
|
|
Amortisation |
|||
|
At 1 February 2025 |
|
|
|
|
At 31 January 2026 |
|
|
|
|
Carrying amount |
|||
|
At 31 January 2026 |
- |
- |
- |
|
At 31 January 2025 |
- |
- |
- |
Hotel Operations Limited
Notes to the Financial Statements
Year Ended 31 January 2026
|
Tangible assets |
Group
|
Land and buildings |
Furniture, fittings and equipment |
Plant and machinery |
Total |
|
|
Cost or valuation |
||||
|
At 1 February 2025 |
|
|
|
|
|
Additions |
- |
|
- |
|
|
At 31 January 2026 |
|
|
|
|
|
Depreciation |
||||
|
At 1 February 2025 |
- |
|
|
|
|
Charge for the year |
- |
|
|
|
|
At 31 January 2026 |
- |
|
|
|
|
Carrying amount |
||||
|
At 31 January 2026 |
|
|
|
|
|
At 31 January 2025 |
|
|
|
|
Included within the net book value of land and buildings above is £5,000,000 (2025 - £5,000,000) in respect of freehold land and buildings.
Hotel Operations Limited
Notes to the Financial Statements
Year Ended 31 January 2026
Company
|
Land and buildings |
Furniture, fittings and equipment |
Total |
|
|
Cost or valuation |
|||
|
At 1 February 2025 |
|
|
|
|
At 31 January 2026 |
|
|
|
|
Depreciation |
|||
|
At 1 February 2025 |
- |
|
|
|
At 31 January 2026 |
- |
|
|
|
Carrying amount |
|||
|
At 31 January 2026 |
|
|
|
|
At 31 January 2025 |
|
|
|
Included within the net book value of land and buildings above is £5,000,000 (2025 - £5,000,000) in respect of freehold land and buildings.
Hotel Operations Limited
Notes to the Financial Statements
Year Ended 31 January 2026
|
Investments |
Company
|
2026 |
2025 |
|
|
Investments in subsidiaries |
|
|
|
Subsidiaries |
£ |
|
Cost or valuation |
|
|
At 1 February 2025 & 31 January 2026 |
|
|
Carrying amount |
|
|
At 31 January 2026 |
|
|
At 31 January 2025 |
|
Hotel Operations Limited
Notes to the Financial Statements
Year Ended 31 January 2026
Details of undertakings
Details of the investments (including principal place of business of unincorporated entities) in which the company holds 20% or more of the nominal value of any class of share capital are as follows:
|
Undertaking |
Registered office |
Holding |
Proportion of voting rights and shares held |
|
|
2026 |
2025 |
|||
|
Subsidiary undertakings |
||||
|
|
Jesmond Dene House,
England |
|
|
|
|
Subsidiary undertakings |
|
Jesmond Dene House Ltd The principal activity of Jesmond Dene House Ltd is |
|
Stocks |
|
Group |
Company |
|||
|
2026 |
2025 |
2026 |
2025 |
|
|
Consumables |
|
|
- |
- |
Hotel Operations Limited
Notes to the Financial Statements
Year Ended 31 January 2026
|
Debtors |
|
Group |
Company |
||||
|
Note |
2026 |
2025 |
2026 |
2025 |
|
|
Trade debtors |
|
|
- |
- |
|
|
Amounts owed by related parties |
|
|
|
|
|
|
Other debtors |
|
|
|
|
|
|
Prepayments |
|
|
- |
- |
|
|
Deferred tax assets |
|
|
|
|
|
|
Income tax asset |
|
|
|
- |
|
|
|
|
|
|
||
|
Cash and cash equivalents |
|
Group |
Company |
|||
|
2026 |
2025 |
2026 |
2025 |
|
|
Cash on hand |
|
|
- |
- |
|
Cash at bank |
|
|
|
|
|
|
|
|
|
|
Hotel Operations Limited
Notes to the Financial Statements
Year Ended 31 January 2026
|
Analysis of changes in net debt |
Group
|
At 1 February 2025 |
Financing cash flows |
At 31 January 2026 |
|
|
Cash and cash equivalents |
|||
|
Cash |
131,535 |
(80,005) |
51,530 |
|
|
|||
|
|
( |
|
|
|
Creditors |
|
Group |
Company |
||||
|
Note |
2026 |
2025 |
2026 |
2025 |
|
|
Due within one year |
|||||
|
Trade creditors |
|
|
- |
- |
|
|
Amounts due to group undertakings |
|
|
|
|
|
|
Social security and other taxes |
|
|
- |
- |
|
|
Outstanding defined contribution pension costs |
|
|
- |
- |
|
|
Other creditors |
|
|
|
|
|
|
Accruals |
|
|
|
|
|
|
Payments on account |
|
|
- |
- |
|
|
|
|
|
|
||
Since the year end Kronen Hotels Ltd have confirmed that the balance owed to it of £4,623,180 will not be repayable for at least twelve months from the signing of the accounts.
Hotel Operations Limited
Notes to the Financial Statements
Year Ended 31 January 2026
|
Pension and other schemes |
Defined contribution pension scheme
The group operates a defined contribution pension scheme. The pension cost charge for the year represents contributions payable by the group to the scheme and amounted to £
Contributions totalling £
|
Reserves |
Group
Share capital
Called up share capital represents the nominal value of shares that have been issued.
Share premium
Share premium represents the price paid in excess of the nominal value of the shares.
Profit and loss account
Profit and loss account The profit and loss account includes all current and prior period retained profits and losses.
Minority interest
The minority interest reserve reflects the share of net assets of the group not controlled by the parent undertaking
Hotel Operations Limited
Notes to the Financial Statements
Year Ended 31 January 2026
|
Share capital |
Allotted, called up and fully paid shares
|
2026 |
2025 |
|||
|
No. |
£ |
No. |
£ |
|
|
|
|
104 |
|
104 |
|
|
|
9 |
|
9 |
|
|
|
|
|
|
Rights, preferences and restrictions
|
Ordinary shares have the following rights, preferences and restrictions: |
|
Ordinary B shares have the following rights, preferences and restrictions: |
|
Commitments |
The total amount of financial commitments not included in the balance sheet is £nil (2025 - £7,915).
The group has provided an unlimited guarantee in respect of borrowings due to NatWest Bank from its parent company, Kronen Hotels Limited.
The total amount of guarantees not included in the balance sheet is £14,405,732.
Hotel Operations Limited
Notes to the Financial Statements
Year Ended 31 January 2026
|
Related party transactions |
Group
Key Management Remuneration
The directors consider that the key management personnel of the group are the directors themselves. Directors remuneration is disclosed in note 7 to the financial statements.
Other related party transactions
During the year the group has had a loan with its immediate parent undertaking, Kronen Hotels Ltd, an entity incorporated in Jersey. Interest was charged on the loan at a rate of 7.75% throughout the period of account. There are no fixed repayment terms.
At the balance sheet date the amount due from the group to its immediate parent undertaking was £4,623,180 (2025 - £5,017,656).
Summary of transactions with all entities under common control
At the year end, the group had a net loan receivable balance of £24,381 (2025 - £48,985) due from entities under the common control of Kronen Hotels Ltd.
|
Parent and ultimate parent undertaking |
The company's immediate parent is
These financial statements are available upon request from First Floor, La Chasse Chambers, Ten La Chasse, St. Helier, JE2 4UE, Jersey.
The ultimate controlling party is