ACCOUNTS - Final Accounts
ACCOUNTS - Final Accounts
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Registered number:
FOR THE YEAR ENDED 26 MAY 2019
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BUSABA EATHAI CLEANCO LIMITED
COMPANY INFORMATION
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BUSABA EATHAI CLEANCO LIMITED
CONTENTS
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BUSABA EATHAI CLEANCO LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 26 MAY 2019
The directors present their Strategic report together with the audited financial statements for the period ended 26 May 2019.
The principal activity of the Company is a holding company for a group operating a number of modern Thai restaurants.
During the year, in a casual dining market facing well publicised difficult trading conditions and cost pressures, the Group focused on gaining the benefits of its continuous improvement programme and driving operational efficiencies. This is expected to deliver incremental profitability through revenue enhancement. During the year, the business refocused on its London operations and the lease on the Liverpool restaurant was successfully assigned. At the close of the period under review the group operated 13 restaurants, with St Albans closing in June 2018 and the lease being subsequently reassigned during the year. Post the year end, the business sub-let the closed site in Manchester. Going forward, given the restructuring of the group that took place in May 2019 and the resulting reduction in loan note debt and the cash injection, the near-term objective for the directors is to further improve the business through continued focused on operating efficiency, the maintenance of a central cost appropriate to the scale of the business and the opportunistic growth of covers and sales through brand-wide and local marketing activities.
The current economic environment and consumer uncertainty post the referendum result in 2016 continues to impact the casual dining market but the directors believe that Busaba’s distinctive brand and dedication to delivering superb Thai food within a strong brand and distinctive environment will help the business endure the challenging trading conditions.
Recruitment and retention of staff is always a key factor in any hospitality business. This has grown particularly important given the potentially increased competition for staff given the potential for increased restriction on the entry of EU nationals to the UK labour market. The directors continue to give great emphasis to finding ways to make Busaba a great place to work to aid with any challenges in attracting and retaining great people.
This report was approved by the board on 28 April 2021 and signed on its behalf.
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BUSABA EATHAI CLEANCO LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 26 MAY 2019
The directors present their report and the financial statements for the year ended 26 May 2019.
The directors are responsible for preparing the Strategic Report, the Directors' Report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and 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 for the Company's financial statements and then apply them consistently;
∙make judgments and accounting estimates that are reasonable and prudent;
∙prepare the financial statements on the going concern basis unless it is inappropriate to presume that the 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 to enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The profit for the year, after taxation, amounted to £168,548 (2018 - loss £7,966,058).
The directors do not recommend payment of a dividend for the period.
The directors who served during the year were:
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BUSABA EATHAI CLEANCO LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 26 MAY 2019
A summary of post balance sheet events is detailed in note 8.
The auditors, Williamson Morton Thornton LLP, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.
This report was approved by the board on
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BUSABA EATHAI CLEANCO LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF BUSABA EATHAI CLEANCO LIMITED
We have audited the financial statements of Busaba Eathai Cleanco Limited (the 'Company') for the year ended 26 May 2019, which comprise the Statement of Comprehensive Income, the Balance Sheet, the Statement of Cash Flows, the Statement of Changes in Equity and the related notes, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the Company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
We draw attention to note 2.3 in the financial statements, which indicates that there are conditions identified that may cast significant doubt on the Company's ability to continue as a going concern, as a result of the loss making position of the group. As stated in note 2.3, these events or conditions, along with the other matters as set forth in note 2.3, indicate that a material uncertainty exists that may cast significant doubt on the Company's ability to continue as a going concern. Our opinion is not modified in respect of this matter.
The directors are responsible for the other information. The other information comprises the information included in the Annual Report, other than the financial statements and our Auditors' Report thereon. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
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BUSABA EATHAI CLEANCO LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF BUSABA EATHAI CLEANCO LIMITED (CONTINUED)
We have nothing to report in this regard.
In our opinion, based on the work undertaken in the course of the audit:
∙the information given in the Strategic Report and the Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
∙the Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.
In the light of the knowledge and understanding of the Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Directors' Report.
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BUSABA EATHAI CLEANCO LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF BUSABA EATHAI CLEANCO LIMITED (CONTINUED)
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an Auditors' Report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these 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 Auditors' Report.
This report is made solely to the Company's members in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in an Auditors' Report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company's members for our audit work, for this report, or for the opinions we have formed.
for and on behalf of
Chartered Accountants and Statutory Auditors
Verulam Point
Station Way
Hertfordshire
AL1 5HE
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BUSABA EATHAI CLEANCO LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 26 MAY 2019
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BUSABA EATHAI CLEANCO LIMITED
REGISTERED NUMBER: 10238587
BALANCE SHEET
AS AT 26 MAY 2019
The financial statements were approved and authorised for issue by the board and were signed on its behalf on
The notes on pages 11 to 15 form part of these financial statements.
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STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 26 MAY 2019
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BUSABA EATHAI CLEANCO LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 26 MAY 2019
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BUSABA EATHAI CLEANCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 26 MAY 2019
Busaba Eathai Cleanco Limited is a private company limited by shares, incorporated in England and Wales under the Companies Act. The address of the registered office is given on the Company Information page and the nature of the Company’s operations and its principal activities are set out in the Strategic report.
2.Accounting policies
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgment in applying the Company's accounting policies (see note 3).
The following principal accounting policies have been applied:
The Company is a parent Company that is also a subsidiary included in the consolidated financial statements of its immediate parent undertaking established under the law of an EEA state and is therefore exempt from the requirement to prepare consolidated financial statements under section 400 of the Companies Act 2006.
The directors have prepared projected forecasts and cash flows for a period of 12 months from the date of signing these accounts. Trading conditions in the casual dining sector have and are continuing to be challenging in 2019 and going into 2020 and 2021. These include further challenges due to the Covid 19 pandemic and the resulting restrictions on opening and trading. Therefore the directors have conducted sensitivity analyses on their projections, and taken into account the post year end acquisition of the group by Curry Acquisitions Limited (including additional capital invested in Busaba Eathai CleanCo Limited), the incremental accordion provided by Muzinich UK Private Debt, the associated waiver of the loan notes issued by the immediate holding company, the resetting of bank covenants and the confirmation by Busaba Eathai Acquisitions Limited and Busaba Eathai Holdings Limited that they will not demand repayment of their intercompany debt until the Company is in a position to repay it.
Trading conditions remain volatile due to the sector that the restaurants operate in and also the uncertainty surrounding the government roadmap for the opening of restaurants and the conditions under which they will be able to open. A material deterioration in performance could lead to a requirement for additional facilities and the company does have a facility available on which to draw. However the group is expected to return to being cash generative at the operating level across the coming financial year after opening restrictions have eased and following the actions taken by management to close loss making units, and implement cost reduction measures. The directors have therefore concluded, taking into account the sensitivity analyses performed, that it is appropriate to prepare the financial statements on a going concern basis, as they forecast the group to operate within the loan facilities available to it.
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BUSABA EATHAI CLEANCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 26 MAY 2019
2.Accounting policies (continued)
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BUSABA EATHAI CLEANCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 26 MAY 2019
2.Accounting policies (continued)
Company's accounting policies. Estimates and assumptions used in the preparation of the financial statements are continually reviewed and revised as necessary.
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BUSABA EATHAI CLEANCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 26 MAY 2019
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BUSABA EATHAI CLEANCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 26 MAY 2019
As a result of the restructuring and acquisition, the loan notes owed to Phoenix Equity Nominees on behalf of Phoenix Equity Partners 2006 Fund in the accounts of Busaba Eathai Cleanco Limited and Busaba Eathai Acquisitions Limited have been repaid for a nominal sum. Busaba Eathai Cleanco Limited converted the existing ordinary shares held by Busaba Eathai Acquisitions Limited to 29 “B” ordinary shares, and issued 28,971 “A” ordinary shares to Curry Acquisition Limited for a consideration of £240,000. As a consequence, Curry Acquisition Limited became the immediate parent company of Busaba Eathai Cleanco Limited, and Busaba Eathai Acquisitions Limited holding in Busaba Eathai Cleanco Limited was reduced to 0.1%. The ultimate controlling party of the Group is now TP2 Limited, and the ultimate controlling party is T. Poole. Since the period end, the COVID-19 (coronavirus) pandemic has had an increasingly significant effect on individuals, businesses and organisations worldwide, including the company. The outbreak came into widespread public knowledge in 2020. In accordance with the Financial Reporting Standard applicable in the UK and the Republic of Ireland and as confirmed by the Financial Reporting Council, the emergence of coronavirus is a non-adjusting post balance sheet event for any entity with a year end of 31 December 2019 or earlier, so this is applicable to the company. Therefore, assets and liabilities should not be adjusted for any potential impact of the pandemic unless the impact is so significant that the Company is no longer a going concern. The Directors have considered the effect on the value of the assets and liabilities of the Company since the balance sheet date, as well as actual and expected future income and expenditure, cash flow requirements and the Company’s ability to continue as a going concern. They have taken steps to protect the workforce and the business, including its cash flow, so as to be able to maintain liquidity given that the effects of the current crisis are likely to last for several months. The management team have been able to mitigate the risks by taking advantage of support available to other companies in the group such as furloughing employees, obtaining business support grants and covid business rates relief on restaurants. In addition there have been negotiations with landlords in regard to leases. Where restrictions have allowed the company has opened restaurants in other group companies by adapting to adhere to all necessary distancing measures and Covid 19 safety protocols.
The Company's immediate parent until 10 May 2019 was Busaba Eathai Holdings Limited which was the ultimate parent company, incorporated in England and Wales.
During the year to 10 May 2019, the ultimate controlling party was Phoenix Equity Partners 2006 Fund, who are the majority shareholders of the ultimate controlling party, Phoenix Equity Nominees Limited. On 10 May 2019, Curry Acquisitions Ltd acquired Busaba Eathai Cleanco Limited. As such, the ultimate controlling party at the year end was Muzinich UK Private Debt S.A.R.L, the shareholders of Curry Acquisitions Ltd, incorporated in Luxembourg. Following a further restructure in July 2020 the parent company of Curry Acquisitions Limited became TP2 Limited and the ultimate controlling party is T. Poole
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