Citygrove Securities PLC - Limited company accounts 18.2

REGISTERED NUMBER: 04757585 (England and Wales)

Citygrove Securities PLC

Strategic Report, Report of the Directors and

Financial Statements for the Year Ended 31 March 2019

Page

Company Information

1

Strategic Report

2

Report of the Directors

4

Report of the Independent Auditors

6

Income Statement

8

Other Comprehensive Income

9

Balance Sheet

10

Statement of Changes in Equity

11

Cash Flow Statement

12

Notes to the Cash Flow Statement

13

Notes to the Financial Statements

14

DIRECTORS:

T R Baines

A J Rennie

P A Waddell

D L Sheehan

SECRETARY:

P A Waddell

REGISTERED OFFICE:

The White House

2 Meadrow

Godalming

Surrey

GU7 3HN

BUSINESS ADDRESS:

10 Albemarle Street

London

W1S 4HH

REGISTERED NUMBER:

04757585 (England and Wales)

AUDITORS:

Hughes Waddell

Chartered Accountants and Statutory Auditors

The White House

2 Meadrow

Godalming

Surrey

GU7 3HN

The directors present their strategic report for the year ended 31 March 2019.

REVIEW OF BUSINESS

The company's main activity is that of acting as a project manager to a number of associated property development

companies in the UK and in Spain and Germany and carrying out pre-let and pre-sold developments in the retail, hotel,

leisure and residential sectors.

RESULTS AND PERFORMANCE

The profit for the year before taxation was £1,110,124 (2018: £1,074,411). No dividend has been paid and the retained

profit for the year after taxation, amounting to £889,597 (2018: £846,092) has been credited to reserves.

The financial results for the year show that the company has continued to trade successfully due to the income arising

from the property developments carried out in the UK and in Spain and Germany by its associated companies. The

company and its associated companies have continued to invest substantial amounts in several development sites during

the year, primarily in sites that had already been purchased in Spain and Germany, together with a new development site

in London. Therefore the directors expect the companies will continue to earn substantial profits as these projects

progress and reach completion.

BUSINESS ENVIRONMENT

The UK commercial and residential property markets remains extremely competitive and as a result it can be difficult to

secure sites for development, or re-development. The yields on commercial properties remain extremely strong which

means that developments are potentially more profitable but this has been counteracted by inflation in raw material costs

and increased labour costs. The directors have to be careful to ensure that property prices are still soundly based and

have not become over-inflated due to a speculative bubble.

STRATEGY

The company's success is dependent on the proper selection, pricing and ongoing management of the property

developments it undertakes. The directors believe it is important to minimise our risks in order to realise consistent and

sustainable profits in this highly competitive marketplace and therefore most, if not all, of the commercial developments

it undertakes are pre-funded and pre-let.

KEY PERFORMANCE INDICATORS

By the very nature of the company's principal activities there are no key performance indicators.

The company has no employees other than its directors. All operations and business activities are undertaken on the

company's behalf by Citygrove Professional Services Limited through a service agreement.

PRINCIPAL RISKS AND UNCERTAINTIES

There are many risks facing the company as it operates in a highly competitive environment which is significantly

influenced by the UK economy. Investor confidence continues to be adversely affected by the decision to leave the EU

and this has tended to reduce the market value of commercial and residential properties. Despite the continuing

uncertainty over Brexit the company has continued to trade successfully since the recession by carefully targeting the

development sectors in which it operates, controlling its costs and by continuing its policy of carrying out development

on a guaranteed pre-let basis. The directors consider that the principal risks that the company faces are as follows:-

1) Financial

The company has finite resources and is dependent upon the availability of financing. The directors monitor and manage

the cash position of the company on a constant basis and commitments are not taken on if funding is not available. The

company reviews its overheads on a regular basis and cuts costs where necessary in order to ensure that it has enough

funding to be able to carry out its chosen developments.

2) Development

Changes in trends cause shifts in customer demand for properties which affect the commercial attractiveness of new

lettings and may lead to tenants becoming insolvent and being unable to complete on a guaranteed pre-let. There is also

a development and construction risk, including the possibility of contractors becoming insolvent during the building

process. The directors manage these risks by carrying out detailed financial checks on prospective tenants and

contractors, including a financial covenant review before the contract is agreed, retaining highly experienced in-house

leasing staff and by maintaining strong relationships with occupiers.

3) Planning Process

There is a planning risk that our schemes will not obtain consent from the relevant Local Authorities, or will take a

disproportionate amount of time to gain approval. We try to minimise this risk by retaining specialist planning

consultants to work on our behalf, by meeting the local planning officers and local residents at the earliest opportunity to

find out their views and ensuring that we take account of their concerns in the design of our schemes.

4) People

There is a risk that the company will not have the right people and skills in the business to meet its business objectives.

The directors try to minimise this risk by ensuring that there is a succession planning system in operation so that the loss

of one person does not lead to the loss of business relationships; by ensuring that staff go on regular training courses in

all relevant professional disciplines to keep them up to date and by applying systematic and known procedures to ensure

consistency of operations.

FUTURE DEVELOPMENTS

Since the financial year end the company, and its associated companies, has continued to invest in the development sites

it owns in the UK and in Dusseldorf and Hannover, in Germany and in Marbella and Santander, in Spain and it

continues to carry out the development management of the refurbishment of a 500,000 square foot office block in the

City of London. All of these projects will take two to three years to complete. Therefore, although there is often a long

lead time between winning, or securing a site for development, starting on site, carrying out the development and being

able to realise the profit on the development the company is continuing to perform extremely well and continues to be

well placed to take advantage of opportunities in the UK & European property market.

ON BEHALF OF THE BOARD:

P A Waddell - Secretary

18 September 2019

The directors present their report with the financial statements of the company for the year ended 31 March 2019.

PRINCIPAL ACTIVITY

The principal activity of the company in the year under review was that of acting as project manager to a number of

associated property development companies in the UK, Spain and Germany, and carrying out pre-let commercial

property development in the retail, leisure and residential sector.

DIVIDENDS

No dividends will be distributed for the year ended 31 March 2019.

DIRECTORS

The directors shown below have held office during the whole of the period from 1 April 2018 to the date of this report.

T R Baines

A J Rennie

P A Waddell

D L Sheehan

Other changes in directors holding office are as follows:

R E Lane - resigned 30 April 2018

CREDITORS

It is the company's policy to pay creditors within 28 days.

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The directors are responsible for preparing the Strategic Report, the Report of the Directors and the financial statements

in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors

have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting

Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not

approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the

company and of the profit or loss of the company for that period. In preparing these financial statements, the directors

are required to:

-	select suitable accounting policies and then apply them consistently;

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

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

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

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the

company's transactions and disclose with reasonable accuracy at any time the financial position of the company and

enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for

safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud

and other irregularities.

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS

So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act

2006) of which the company's auditors are unaware, and each director has taken all the steps that he ought to have taken

as a director in order to make himself aware of any relevant audit information and to establish that the company's

auditors are aware of that information.

AUDITORS

The auditors, Hughes Waddell, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

P A Waddell - Secretary

18 September 2019

Opinion

We have audited the financial statements of Citygrove Securities PLC (the 'company') for the year ended 31 March 2019

which comprise the Income Statement, Other Comprehensive Income, Balance Sheet, Statement of Changes in Equity,

Cash Flow Statement and Notes to the Cash Flow Statement, Notes to the Financial Statements, including a summary of

significant accounting policies. The financial reporting framework that has been applied in their preparation is

applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial

Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting

Practice).

In our opinion the financial statements:

-	give a true and fair view of the state of the company's affairs as at 31 March 2019 and of its profit for the year then ended;

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

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

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law.

Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the

financial statements section of our report. We are independent of the company in accordance with the ethical

requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard,

and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit

evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report to

you where:

-	the directors' use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or

-

the directors have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the company's ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the financial statements are authorised for issue.

Other information

The directors are responsible for the other information. The other information comprises the information in the Strategic

Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors

thereon.

Our opinion on the financial statements does not cover the other information and, except to the extent otherwise

explicitly stated in our report, we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing

so, consider whether the other information is materially inconsistent with the financial statements or our knowledge

obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or

apparent material misstatements, we are required to determine whether 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.

Opinions on other matters prescribed by the Companies Act 2006

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

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

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

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit,

we have not identified material misstatements in the Strategic Report or the Report of the Directors.

We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you

if, in our opinion:

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

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

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

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

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities, the directors are responsible for the preparation

of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the

directors determine necessary to enable the preparation of financial statements that are free from material misstatement,

whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a

going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of

accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic

alternative but to do so.

Auditors' responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from

material misstatement, whether due to fraud or error, and to issue a Report of the Auditors that includes our opinion.

Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs

(UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are

considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic

decisions of users taken on the basis of these financial statements.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting

Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors.

Use of our report

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the

Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those

matters we are required to state to them in a Report of the Auditors and for no other purpose. To the fullest extent

permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's

members as a body, for our audit work, for this report, or for the opinions we have formed.

Nicholas Dodd BA, FCA (Senior Statutory Auditor)

for and on behalf of Hughes Waddell

Chartered Accountants and Statutory Auditors

The White House

2 Meadrow

Godalming

Surrey

GU7 3HN

18 September 2019

TURNOVER

19,463,707

12,300,986

Cost of sales

124,277

137,304

GROSS PROFIT

19,339,430

12,163,682

Administrative expenses

18,490,191

11,340,055

849,239

823,627

Other operating income

250,000

250,000

OPERATING PROFIT

4

1,099,239

1,073,627

Interest receivable and similar income

11,007

784

1,110,246

1,074,411

Interest payable and similar expenses

5

122

-

PROFIT BEFORE TAXATION

1,110,124

1,074,411

Tax on profit

6

220,527

228,319

PROFIT FOR THE FINANCIAL YEAR

889,597

846,092

PROFIT FOR THE YEAR

889,597

846,092

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

889,597

846,092

FIXED ASSETS

Tangible assets

7

20,042

35,116

CURRENT ASSETS

Debtors

8

32,649,259

15,079,282

Cash at bank

11,718,254

2,298,748

44,367,513

17,378,030

CREDITORS

Amounts falling due within one year

9

38,994,375

12,909,563

NET CURRENT ASSETS

5,373,138

4,468,467

TOTAL ASSETS LESS CURRENT LIABILITIES

5,393,180

4,503,583

CAPITAL AND RESERVES

Called up share capital

11

50,000

50,000

Retained earnings

12

5,343,180

4,453,583

SHAREHOLDERS' FUNDS

5,393,180

4,503,583

The financial statements were approved by the Board of Directors on 18 September 2019 and were signed on its behalf by:

T R Baines - Director

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 April 2017

50,000

3,607,491

3,657,491

Changes in equity

Total comprehensive income

-

846,092

846,092

Balance at 31 March 2018

50,000

4,453,583

4,503,583

Changes in equity

Total comprehensive income

-

889,597

889,597

Balance at 31 March 2019

50,000

5,343,180

5,393,180

Cash flows from operating activities

Cash generated from operations

1

7,649,743

4,692,391

Interest paid

(122

)

-

Tax paid

(228,319

)

(44,716

)

Net cash from operating activities

7,421,302

4,647,675

Cash flows from investing activities

Purchase of tangible fixed assets

(12,803

)

-

Interest received

11,007

784

Net cash from investing activities

(1,796

)

784

Cash flows from financing activities

Net loans in year

2,000,000

(7,971,468

)

Net cash from financing activities

2,000,000

(7,971,468

)

Increase/(decrease) in cash and cash equivalents

9,419,506

(3,323,009

)

Cash and cash equivalents at beginning of year

2

2,298,748

5,621,757

Cash and cash equivalents at end of year

2

11,718,254

2,298,748

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

31.3.19

31.3.18

£

£

Profit before taxation

1,110,124

1,074,411

Depreciation charges

27,877

24,677

Finance costs

122

-

Finance income

(11,007

)

(784

)

1,127,116

1,098,304

Increase in trade and other debtors

(17,569,977

)

(1,732,352

)

Increase in trade and other creditors

24,092,604

5,326,439

Cash generated from operations

7,649,743

4,692,391

2.	CASH AND CASH EQUIVALENTS

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

Balance Sheet amounts:

Year ended 31 March 2019

31.3.19

1.4.18

£

£

Cash and cash equivalents

11,718,254

2,298,748

Year ended 31 March 2018

31.3.18

1.4.17

£

£

Cash and cash equivalents

2,298,748

5,621,757

1.	STATUTORY INFORMATION

Citygrove Securities PLC is a private company , registered in England and Wales. The company's registered

number and registered office address can be found on the Company Information page.

The presentation currency of the financial statements is the Pound Sterling (£).

2.	ACCOUNTING POLICIES

Basis of preparing the financial statements

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

Significant judgements and estimates

Preparation of the financial statements requires management to make significant judgements and estimates. The

items in the financial statements where these judgements and estimates have been made include accrued income.

Turnover

Turnover consists of project related management fees relating to the year under unconditional contracts from

projects in the United Kingdom, Spain and Germany, and the recharge of project related costs. Turnover is stated

net of VAT. Turnover is recognised when the company obtains the right to consideration.

Tangible fixed assets

Tangible fixed assets are measured at cost less accumulated depreciation and any accumulated impairment

losses.

Depreciation is provided on all tangible fixed assets at rates calculated to write off the cost of each asset over its

expected useful life, as follows:-

Office equipment

- 25% per annum on a straight line basis

Fixtures & fittings

- 25% per annum on a straight line basis

Pictures

- 10% per annum on a straight line basis

Impairment of assets

At each reporting date fixed assets are reviewed to determine whether there is any indication that those assets

have suffered an impairment loss. If there is an indication of possible impairment, the recoverable amount of any

affected asset is estimated and compared with its carrying amount. If estimated recoverable amount is lower, the

carrying amount is reduced to its estimated recoverable amount, and an impairment loss is recognised

immediately in profit or loss.

If an impairment loss subsequently reverses, the carry amount of the asset is increased to the revised estimate of

its recoverable amount, but not in excess of the amount that would have been determined had no impairment loss

been recognised for the asset in prior years. A reversal of an impairment loss is recognised immediately in profit

or loss.

Financial instruments

Financial instruments comprise financial assets, cash and cash equivalents, financial liabilities and equity

instruments.

Financial assets

Financial assets are classified as either financial assets at fair value through profit or loss, or loans and

receivables, as appropriate. When financial assets are recognised initially, they are measured at fair value.

Transaction costs that are directly attributable to the acquisition or issue of the financial asset are capitalised

unless they relate to a financial asset classified at fair value through profit and loss in which case transaction

costs are expensed in the income statement.

The Company determines the classification of its financial assets at initial recognition and, where allowed and

appropriate, re-evaluates this designation at each financial year end.

Financial instruments (continued)

Financial assets (cont)

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not

quoted in an active market.After initial measurement loans and receivables are subsequently carried at amortised

cost, using the effective interest rate method, less any allowance for impairment.Amortised cost is calculated by

taking into account any discount or premium on acquisition over the period to maturity. Gains and losses are

recognised in the income statement when the loans and receivables are de-recognised or impaired, as well as

through the amortisation process.

Cash and cash equivalents

Cash and cash equivalents are balances with banks.

Financial liabilities

Financial liabilities include interest bearing loans and borrowings, and trade and other payables.

Obligations for loans and borrowings are recognised when the Company becomes party to the related contracts

and are measured initially at the fair value of consideration received less directly attributable transaction costs.

After initial recognition, interest bearing loans and borrowings are subsequently measured at amortised cost

using the effective interest method.

Gains and losses are recognised in the income statement when the liabilities are derecognised as well as through

the amortisation process.

Equity

Equity instruments issued by the Company are recorded in equity at the proceeds received, net of direct issue

costs.

Taxation

Taxation for the year comprises current and deferred tax. Tax is recognised in the Income Statement, except to

the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or

substantively enacted by the balance sheet date.

Deferred tax

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

sheet date.

Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from

those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that

have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the

timing difference.

Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they

will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

Foreign currencies

Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the

balance sheet date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at

the date of transaction. Exchange differences are taken into account in arriving at the operating result.

Accrued income

Accrued income represents rechargeable costs invoiced during the year that relate to future developments.

3.	EMPLOYEES AND DIRECTORS

There were no staff costs for the year ended 31 March 2019 nor for the year ended 31 March 2018.

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

31.3.19

31.3.18

Directors

4

5

31.3.19

31.3.18

£

£

Directors' remuneration

-

-

4.	OPERATING PROFIT

The operating profit is stated after charging:

31.3.19

31.3.18

£

£

Depreciation - owned assets

27,877

24,677

Auditor's remuneration - audit services

10,000

10,000

- Non-audit services

11,500

8,447

5.

INTEREST PAYABLE AND SIMILAR EXPENSES

31.3.19

31.3.18

£

£

Interest on Corporation Tax

122

-

6.

TAXATION

Analysis of the tax charge

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

31.3.19

31.3.18

£

£

Current tax:

UK corporation tax

220,527

228,319

Tax on profit

220,527

228,319

Reconciliation of total tax charge included in profit and loss

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

explained below:

31.3.19

31.3.18

£

£

Profit before tax

1,110,124

1,074,411

Profit multiplied by the standard rate of corporation tax in the UK of 19% (2018 - 19%)

210,924

204,138

Effects of:

Expenses not deductible for tax purposes

7,664

20,509

Depreciation in excess of capital allowances

1,939

3,672

Total tax charge

220,527

228,319

7.	TANGIBLE FIXED ASSETS

Fixtures

and

Office

Pictures

fittings

equipment

Totals

£

£

£

£

COST

At 1 April 2018

17,400

298,441

59,625

375,466

Additions

-

-

12,803

12,803

At 31 March 2019

17,400

298,441

72,428

388,269

DEPRECIATION

At 1 April 2018

5,220

278,410

56,720

340,350

Charge for year

1,740

20,031

6,106

27,877

At 31 March 2019

6,960

298,441

62,826

368,227

NET BOOK VALUE

At 31 March 2019

10,440

-

9,602

20,042

At 31 March 2018

12,180

20,031

2,905

35,116

8.

DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

31.3.19

31.3.18

£

£

Other debtors

689,726

714,286

Related undertakings

29,910,827

12,495,510

VAT

8,170

-

Prepayments and accrued income

2,040,536

1,869,486

32,649,259

15,079,282