The London Cocktail Club Ltd - Period Ending 2019-06-30

The London Cocktail Club Ltd

Annual Report and Unaudited Financial Statements
Year Ended 30 June 2019

Registration number: 07438012

The London Cocktail Club Ltd

Contents

Company Information	1
Balance Sheet	2 to 3
Notes to the Financial Statements	4 to 12

The London Cocktail Club Ltd

Company Information

Directors

Mr R A Blanc Mr J J Goodman Mr J Hopkins Dr L S Moir Mrs S L Willingham-Toxvaerd

Company secretary

Mr A Roberts

Registered office

3rd Floor 33 Percy Street London W1T 2DF

Accountants

Francis Clark LLP Ground Floor Blackbrook Gate 1 Blackbrook Business Park Taunton Somerset TA1 2PX

Page 1

The London Cocktail Club Ltd

Balance Sheet

30 June 2019

	Note	2019 £	2018 £
Fixed assets
Intangible assets	5	7,795	-
Tangible assets	6	2,260,987	1,690,866
Investments	7	248	248
		2,269,030	1,691,114
Current assets
Stocks	8	92,339	67,382
Debtors	9	770,720	810,170
Cash at bank and in hand		211,891	321,608
		1,074,950	1,199,160
Creditors: Amounts falling due within one year	10	(1,717,106)	(1,059,928)
Net current (liabilities)/assets		(642,156)	139,232
Total assets less current liabilities		1,626,874	1,830,346
Creditors: Amounts falling due after more than one year	10	(810,864)	(643,942)
Deferred tax provision		(108,128)	(108,132)
Net assets		707,882	1,078,272
Capital and reserves
Called up share capital		10,248	10,248
Share premium reserve		45,000	45,000
Profit and loss account		652,634	1,023,024
Total equity		707,882	1,078,272

The notes on pages 4 to 12 form an integral part of these financial statements.

Page 2

The London Cocktail Club Ltd

Balance Sheet

30 June 2019

For the financial year ending 30 June 2019 the company was entitled to exemption from audit under section 477 of the Companies Act 2006 relating to small companies.

Directors' responsibilities:

•	The members have not required the company to obtain an audit of its accounts for the year in question in accordance with section 476; and
•	The directors acknowledge their responsibilities for complying with the requirements of the Act with respect to accounting records and the preparation of accounts.

These financial statements have been prepared and delivered in accordance with the special provisions relating to companies subject to the small companies regime within Part 15 of the Companies Act 2006 and the option not to file the Profit and Loss Account has been taken.

Approved and authorised by the Board on 21 February 2020 and signed on its behalf by:
 

......................................... Dr L S Moir Director

Company Registration Number: 07438012

The notes on pages 4 to 12 form an integral part of these financial statements.

Page 3

The London Cocktail Club Ltd

Notes to the Financial Statements

Year Ended 30 June 2019

1	General information

The company is a private company limited by share capital, incorporated in England and Wales.

The address of its registered office is:
3rd Floor
33 Percy Street
London
W1T 2DF

These financial statements were authorised for issue by the Board on 21 February 2020.

2	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 have been prepared in accordance with Financial Reporting Standard 102 - 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' including section 1A and the Companies Act 2006.

Basis of preparation

These financial statements have been prepared using the historical cost convention.

Group accounts not prepared

The company and its trading subsidiary form a small group. The company is therefore not required to produce consolidated financial statements and has not done so. These financial statements present information about the company as a single entity.

Going concern

Notwithstanding the net current liabilities of £671,834 (2018: net current assets of £139,232), the directors have prepared the financial statements on a going concern basis. In forming this opinion the directors, having made all necessary enquiries, have considered, in particular, the following:
• The underlying trade of the company is profitable with operating profit (before depreciation and non-recurring costs) for the year to 30 June 2019 of over £830,000.
• The directors have conducted and implemented a strategic review of the estate and operations.
• The operating profitability, cash generation and facilities available post year end and forecasted for at least 12 months from the date of approval of these financial statements

Page 4

The London Cocktail Club Ltd

Notes to the Financial Statements

Year Ended 30 June 2019

Key accounting judgements and sources of estimation uncertainty

In the application of the company's accounting policies management is required to make judgements, estimates and assumptions about the carrying values of assets and liabilities that are not readily apparent from other sources. The estimates and underlying 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.

In the opinion of the directors, there are no key judgements that have a significant effect on the financial statements or key sources of estimation uncertainty as at 30 June 2019.

Revenue recognition

Turnover comprises the fair value of the consideration received or receivable for the sale of goods and provision of services in the ordinary course of the company’s activities. Turnover is shown net of value added tax, returns, rebates and discounts.

Revenue is recognised as goods and services are provided to customers.

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 company 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 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 amounts 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.

Page 5

The London Cocktail Club Ltd

Notes to the Financial Statements

Year Ended 30 June 2019

Depreciation

Depreciation is charged so as to write off the cost of assets, other than land and assets under construction over their estimated useful lives, as follows:

Asset class	Depreciation method and rate
Leasehold property	Straight line over the period of the lease
Furniture, fittings and equipment	20% reducing balance
Other property, plant and equipment	20% reducing balance

Intangible assets

Separately acquired trademarks and licences are shown at historical cost.

Trademarks, licences (including software) and customer-related intangible assets acquired in a business combination are recognised at fair value at the acquisition date.

Trademarks, licences and customer-related intangible assets have a finite useful life and are carried at cost less accumulated amortisation and any accumulated impairment losses.

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
Trademark	10% straight line

Investments

Investments in equity shares which are not publicly traded and where fair value cannot be measured reliably are measured at cost less impairment.

Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell.

At each reporting date, stocks are assessed for impairment. If stocks are impaired, the carrying amount is reduced to its selling price less costs to complete and sell; the impairment loss is recognised immediately in profit or loss.

Leases

Leases in which substantially all the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases are charged to profit or loss on a straight-line basis over the period of the lease.

Defined contribution pension obligation

A defined contribution plan is a pension plan under which fixed contributions are paid into a pension fund and the company 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.

Page 6

The London Cocktail Club Ltd

Notes to the Financial Statements

Year Ended 30 June 2019

Financial instruments

Classification
The company holds the following financial instruments:

• Short term trade and other debtors and creditors;
• Bank loans; and
• Cash and bank balances.

All financial instruments are classified as basic.

 Recognition and measurement
The company has chosen to apply the recognition and measurement principles in FRS102.

Financial instruments are recognised when the company 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 company’s obligations are discharged, expire or are cancelled.

Except for bank loans, 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.

Bank loans are initially measured at transaction price, including transaction costs, and are subsequently carried at amortised cost using the effective interest method.

 

3	Financial results

The trading results of the company during the year were as follows:

Operational EBITDA	843,589
Pre-opening costs on new sites	(112,351)
Interest	(62,777)
Depreciation & loss on disposal	(363,835)
Loss on closure of site	(194,950)
Exceptional items	(75,999)
Inter-company write off	(403,745)
Taxation	(322)
Loss for year	(370,390)

4	Staff numbers

The average number of persons employed by the company (including directors) during the year, was 84 (2018 - 69).

Page 7

The London Cocktail Club Ltd

Notes to the Financial Statements

Year Ended 30 June 2019

5	Intangible assets

	Trademarks, patents and licenses  £	Total £
Cost or valuation
Additions acquired separately	8,278	8,278
At 30 June 2019	8,278	8,278
Amortisation
Amortisation charge	483	483
At 30 June 2019	483	483
Carrying amount
At 30 June 2019	7,795	7,795

6	Tangible assets

	Leasehold property £	Furniture, fittings and equipment  £	Other property, plant and equipment  £	Total £
Cost or valuation
At 1 July 2018	994,303	157,922	1,145,254	2,297,479
Additions	615,300	29,210	436,890	1,081,400
Disposals	(111,862)	(1,650)	(129,959)	(243,471)
At 30 June 2019	1,497,741	185,482	1,452,185	3,135,408
Depreciation
At 1 July 2018	172,505	40,503	393,605	606,613
Charge for the year	149,180	25,264	185,798	360,242
Eliminated on disposal	(22,206)	-	(70,228)	(92,434)
At 30 June 2019	299,479	65,767	509,175	874,421
Carrying amount
At 30 June 2019	1,198,262	119,715	943,010	2,260,987
At 30 June 2018	821,798	117,419	751,649	1,690,866

Page 8

The London Cocktail Club Ltd

Notes to the Financial Statements

Year Ended 30 June 2019

7	Investments

	2019 £	2018 £
Investments in subsidiaries	248	248

Subsidiaries	£
Cost or valuation
At 1 July 2018	248
Carrying amount
At 30 June 2019	248
At 30 June 2018	248

Details of undertakings

Details of the investments 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
			2019	2018
Subsidiary undertakings
The Craft Cocktail Company Ltd	3rd Floor 33 Percy Street London W1T 2DF	Ordinary	100%	100%
	United Kingdom

The principal activity of The Craft Cocktail Company Ltd is operation of cocktail bars and the manufacture of ready mixed cocktails

The loss for the financial period of The Craft Cocktail Company Ltd was £155,378 and the aggregate amount of capital and reserves at the end of the period was £(233,056).

8

Stocks

	2019 £	2018 £
Goods for resale	92,339	67,382

Page 9

The London Cocktail Club Ltd

Notes to the Financial Statements

Year Ended 30 June 2019

9

Debtors

	2019  £	2018  £
Trade debtors	164,612	71,241
Amounts due from group undertakings	-	276,476
Other debtors	241,825	172,543
Prepayments	364,283	289,910
	770,720	810,170

10

Creditors

Creditors: amounts falling due within one year

	Note	2019 £	2018  £
Loans and borrowings	11	374,756	230,884
Trade creditors		529,673	303,244
Corporation tax		322	39,578
Social security and other taxes		158,536	147,895
Outstanding defined contribution pension costs		11,253	6,022
Other creditors		455,016	85,408
Accrued expenses		187,550	246,897
		1,717,106	1,059,928

Creditors include bank loans which are secured of £380,756 (2018 - £234,884). The loans have been secured by way of a floating charge over the assets of the company and are stated above net of the current element of the loan arrangement fees.

Creditors: amounts falling due after more than one year

	Note	2019 £	2018 £
Loans and borrowings	11	810,864	643,942

Creditors include bank loans which are secured of £825,881 (2018 - £655,678). The loans have been secured by way of a floating charge over the assets of the company and are stated above net of the non-current element of the loan arrangement fees.

Page 10

The London Cocktail Club Ltd

Notes to the Financial Statements

Year Ended 30 June 2019

11	Loans and borrowings

	2019 £	2018 £
Loans and borrowings due after one year
Bank borrowings	810,864	643,942

	2019 £	2018 £
Current loans and borrowings
Bank borrowings	374,756	230,884

Loans and borrowings as at 30 June 2019 totalling £1,185,704 are stated net of £21,017 of loan arrangement fees.

12	Obligations under leases

Operating leases

The total of future minimum lease payments is as follows:

	2019  £	2018  £
Not later than one year	587,500	477,496
Later than one year and not later than five years	2,327,333	1,909,984
Later than five years	3,555,500	2,696,145
	6,470,333	5,083,625

13	Share capital

Allotted, called up and fully paid shares

	2019		2018
	No.	£	No.	£
A Ordinary shares of £0.001 each	10,247,990	10,248	10,247,990	10,248

Page 11

The London Cocktail Club Ltd

Notes to the Financial Statements

Year Ended 30 June 2019

14	Share based payments

The London Cocktail Club Ltd EMI Share Option Plan

The company has a share option scheme in which one employee participates -The London Cocktail Club Ltd EMI Share Option Plan (EMI scheme) set up in January 2016. Under the EMI scheme, the company has granted an EMI option over Ordinary A shares in the company. The option vests upon certain criteria in respect of the sale of the company or its assets, or the company being listed on a recognised stock exchange, being met. The directors have granted options over 300,000 shares to one employee each with an exercise price of £0.17 and an expiry date of January 2026.

The London Cocktail Club Ltd Unapproved Option Agreement

The company has a share option scheme in which one individual participates -The London Cocktail Club Ltd Unapproved Option Agreement (Option agreement) set up in November 2017. Under the Option agreement, the company has granted an option over Ordinary A shares in the company. The option vests upon certain criteria in respect of the sale of the company or its assets, or the company being listed on a recognised stock exchange, being met or on the tenth anniversary of the agreement. The directors have granted options over 105,480 shares to one individual each with an exercise price of £0.76.

The directors have assessed the fair value of the share options at 30 June 2019 in accordance with the requirements of FRS 102 and the underlying terms of the options. The value of the options is not material and, therefore, has not been included in the accounts of the company.

Page 12