The Vinyl Factory Limited - Limited company accounts 20.1
The Vinyl Factory Limited - Limited company accounts 20.1
| REGISTERED NUMBER: 04184222 (England and Wales) |
| Group Strategic Report, |
| Report of the Director and |
| Consolidated Financial Statements |
| for the Year Ended 29 February 2020 |
| for |
| The Vinyl Factory Limited |
| The Vinyl Factory Limited (Registered number: 04184222) |
| Contents of the Consolidated Financial Statements |
| for the Year Ended 29 February 2020 |
| Page |
| Company Information | 1 |
| Group Strategic Report | 2 |
| Report of the Director | 4 |
| Report of the Independent Auditors | 5 |
| Consolidated Income Statement | 7 |
| Consolidated Other Comprehensive Income | 8 |
| Consolidated Balance Sheet | 9 |
| Company Balance Sheet | 10 |
| Consolidated Statement of Changes in Equity | 11 |
| Company Statement of Changes in Equity | 12 |
| Consolidated Cash Flow Statement | 13 |
| Notes to the Consolidated Cash Flow Statement | 14 |
| Notes to the Consolidated Financial Statements | 15 |
| The Vinyl Factory Limited |
| Company Information |
| for the Year Ended 29 February 2020 |
| DIRECTOR: |
| SECRETARY: |
| REGISTERED OFFICE: |
| REGISTERED NUMBER: |
| AUDITORS: |
| Statutory Auditors |
| Chartered Accountants & Business Advisers |
| 15 Newland |
| Lincoln |
| Lincolnshire |
| LN1 1XG |
| The Vinyl Factory Limited (Registered number: 04184222) |
| Group Strategic Report |
| for the Year Ended 29 February 2020 |
| The director presents his strategic report of the company and the group for the year ended 29 February 2020. |
| REVIEW OF BUSINESS |
| Consolidated group turnover for the year from ordinary activities grew to £27,422,706 - an increase of 3.1% over the previous year. |
| During the year under review the Company and its subsidiaries continued with its property management, investment (development) management and its direct investment in development / investment properties in London and Berlin. Directly owned properties comprise commercial and residential property and farm land and buildings. All the group's investment properties were subject to the requirements of UK accounting standards for an annual valuation to fair value. These valuations have been undertaken by independent professional valuers with the exception of one which was assessed by the Director. Following the independent valuations and taking into account currency fluctuations there has been an increase in the overall balance sheet values shown in these accounts. Trading results in the music division which includes vinyl record manufacturing, distribution, retailing and licencing was consistent with the previous year with combined turnover of £4.6 million. The digital publishing activities through publications: 'Fact Mag', 'The Vinyl Factory' and 'The Spaces' continued to develop its online traffic. Turnover at the hotel which remained under management was similar to the prior year at just under £9 million. Gross profits showed a small reduction from the previous year to £3.5 million whereas Net Profit increased by 10.7% - the result of a reduction in interest costs due to a loan repayment made in the year ended February 2019. The rolling programme of room refurbishments continued in the year under review although these were limited as the hotel continued full operations during this time. Furniture, fittings and additional art was added to in the public areas and specific rooms as part of the ongoing refurbishment works and the overall repositioning of the hotel. Design development continued for the more extensive proposed works as did work on the rebranding of the hotel in association with an external consultant. The group's marketing, events, productions, studios, restaurants and fashion retailing businesses further increased turnover at its locations in London, Oxfordshire and Berlin. Combined turnover across these businesses is now circa £13 million. The Store X produced a range of events and gallery shows during the year at its leased premises at 180 Strand including working with brands such as Cartier and Prada and events that included London Fashion Week. These formed a part of the on-going positioning strategy for 180 Strand, WC2 as a creative and cultural hub for London. Public exhibitions in the year included shows by United Visual Artists (in collaboration with the Fondation Cartier) and Transformer: A Rebirth of Wonder (curated by Jefferson Hack). These followed previous acclaimed shows that have included, Infinite Mix, produced in association with the Hayward Gallery (2016), Everything At Once with the Lisson Gallery (2017), Wes Andersson for his animation, Isle of Dogs (2018), Strange Days: Memories of the Future with the New Museum, New York (2018) and Ruin (Virgil Abloh and Ben Kelly). The Store X continues to commission audio visual and other artworks with established and emerging artists for exhibiting at 180 The Strand. |
| PRINCIPAL RISKS AND UNCERTAINTIES |
| The director of the company reviews any risks and uncertainties that are either currently faced by the company or will potentially be faced by the company in the future. Measures are then agreed upon to be put in place to mitigate these situations. |
| The principal risk for the group are the commercial and residential property markets and those of the broader economy and the demand for hotel leisure, conferences, restaurants, retail and events related activities. The group's property valuations are reviewed annually to reflect fair value and consequently are subject to any changes in the property market which can be outside the control of management. The management of the group has a strong track record of investing, creating and managing market leading properties in strong areas with a high degree of resilience and as such this serves to mitigate the inherent risks of any fluctuating property markets. The director regularly monitors the market and the development and management of the properties held and managed by the group. Through this process, the director is confident that these risks are managed as well as possible. Although after the financial year end of February 2020, the COVID pandemic has had a significant impact on the following financial year. The hotel, events, exhibition and retailing businesses were closed for large parts of 2020 and into the first quarter of 2021 and inevitably this has led to operating losses. Rental income has also been impacted but to a lesser extent. The operational losses and the funding of the ongoing activities of the companies were met by the adequate reserves and resources (both existing and committed) of the companies. During the following period funds as committed from third party financing materialised. |
| FUTURE DEVELOPMENTS |
| The closure of the hotel during the COVID pandemic has allowed for unrestricted work to the planned hotel refurbishment programme. This has provided the opportunity to complete works ahead of schedule. At 180 The Strand the closure has also allowed for the accelerated evolution and development of the expanding operations located there. The director anticipates strong demand when the hotel and other public facing activities at 180 The Strand and elsewhere reopen. |
| The Vinyl Factory Limited (Registered number: 04184222) |
| Group Strategic Report |
| for the Year Ended 29 February 2020 |
| ANALYSIS OF DEVELOPMENT AND PERFORMANCE AND FINANCIAL KEY PERFORMANCE INDICATORS |
| Turnover for the year increased to £27,422,706 (2019: £26,508,054). |
| Gross profit for the period increased to £12,231,988 (2019: £13,074,724) |
| ON BEHALF OF THE BOARD: |
| The Vinyl Factory Limited (Registered number: 04184222) |
| Report of the Director |
| for the Year Ended 29 February 2020 |
| The director presents his report with the financial statements of the company and the group for the year ended 29 February 2020. |
| PRINCIPAL ACTIVITIES |
| The Vinyl Factory Limited is a holding company which coordinates the activities of a number of diverse subsidiaries. |
| These companies are involved in the holding of property for management and development including hotel management operations and the letting of offices, workspaces and studios and various activities involving music, fashion, arts and the creative industries. Specifically these activities include the production of events, exhibitions and art shows, the sale and retailing of artworks, fashion and furniture and the sale and retailing of vinyl records and music related products and merchandise, the provision of label services and the distribution, production and retail of limited vinyl records and the publishing of a number of online publications. |
| DIVIDENDS |
| No dividends will be distributed for the year ended 29 February 2020. |
| EVENTS SINCE THE END OF THE YEAR |
| Information relating to events since the end of the year is given in the notes to the financial statements. |
| DIRECTOR |
| STATEMENT OF DIRECTOR'S RESPONSIBILITIES |
| The director is responsible for preparing the Group Strategic Report, the Report of the Director and the financial statements in accordance with applicable law and regulations. |
| Company law requires the director to prepare financial statements for each financial year. Under that law the director has 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 director must not approve the financial statements unless he is satisfied that they give a true and fair view of the state of affairs of the company and the group and of the profit or loss of the group for that period. In preparing these financial statements, the director is required to: |
| - | select suitable accounting policies and then apply them consistently; |
| - | make judgements 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 director is responsible for keeping adequate accounting records that are sufficient to show and explain the company's and the group's transactions and disclose with reasonable accuracy at any time the financial position of the company and the group and enable him to ensure that the financial statements comply with the Companies Act 2006. He is also responsible for safeguarding the assets of the company and the group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. |
| STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS |
| So far as the director is aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the group's auditors are unaware, and he 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 group's auditors are aware of that information. |
| ON BEHALF OF THE BOARD: |
| Report of the Independent Auditors to the Members of |
| The Vinyl Factory Limited |
| Opinion |
| We have audited the financial statements of The Vinyl Factory Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 29 February 2020 which comprise the Consolidated Income Statement, Consolidated Other Comprehensive Income, Consolidated Balance Sheet, Company Balance Sheet, Consolidated Statement of Changes in Equity, Company Statement of Changes in Equity, Consolidated Cash Flow Statement and Notes to the Consolidated 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, except for the possible effects of the matters described in the basis for qualified opinion paragraph, the financial statements of the group and parent company: |
| - give a true and fair view of the state of the company's and group's affairs as at 29 February 2020 and of its profit for the year then ended; |
| - have been properly prepared in accordance with FRS 102; and |
| - have been prepared in accordance with the requirements of the Companies Act 2006. |
| Basis for qualified opinion |
| Due to a limitation of scope we have not been able to verify the valuation of an investment property of a subsidiary shown in the consolidated financial statements at a value of £3,000,000. |
| 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 director's use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or |
| - | the director has not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the group'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. |
| Emphasis of matter- COVID-19 |
| We draw attention to Note 26 to the financial statements which describes a non-adjusting post balance sheet event in relation to the coronavirus pandemic. Our opinion is not modified in respect of this matter. |
| Other information |
| The director is responsible for the other information. The other information comprises the information in the Group Strategic Report and the Report of the Director, 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 Group Strategic Report and the Report of the Director for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
| - | the Group Strategic Report and the Report of the Director 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 group and the parent company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group Strategic Report or the Report of the Director. |
| - | 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 director's remuneration specified by law are not made. |
| Report of the Independent Auditors to the Members of |
| The Vinyl Factory Limited |
| Responsibilities of director |
| As explained more fully in the Statement of Director's Responsibilities set out on page four, the director is 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 director determines 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 director is 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 director either intends to liquidate the group or the parent company or to cease operations, or has 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. |
| for and on behalf of |
| Statutory Auditors |
| Chartered Accountants & Business Advisers |
| 15 Newland |
| Lincoln |
| Lincolnshire |
| LN1 1XG |
| The Vinyl Factory Limited (Registered number: 04184222) |
| Consolidated Income Statement |
| for the Year Ended 29 February 2020 |
| 2020 | 2019 |
| Notes | £ | £ | £ | £ |
| TURNOVER | 3 | 27,422,706 | 26,608,054 |
| Cost of sales | 15,190,718 | 13,533,330 |
| GROSS PROFIT | 12,231,988 | 13,074,724 |
| Distribution costs | 167,671 | 199,855 |
| Administrative expenses | 9,333,982 | 9,139,213 |
| 9,501,653 | 9,339,068 |
| 2,730,335 | 3,735,656 |
| Other operating income | 3,908,187 | 553,964 |
| Gain/loss on revaluation of investment property |
7,121,768 |
7,994,568 |
| OPERATING PROFIT | 5 | 13,760,290 | 12,284,188 |
| Impairment | 6 | 4,099,215 | 982,925 |
| 9,661,075 | 11,301,263 |
| Interest receivable and similar income | 26,744 | 23,928 |
| 9,687,819 | 11,325,191 |
| Interest payable and similar expenses | 7 | 6,329,491 | 6,478,854 |
| PROFIT BEFORE TAXATION | 3,358,328 | 4,846,337 |
| Tax on profit | 8 | 325,395 | 540,833 |
| PROFIT FOR THE FINANCIAL YEAR |
| Profit attributable to: |
| Owners of the parent | 207,539 | 563,257 |
| Non-controlling interests | 2,825,394 | 3,742,247 |
| 3,032,933 | 4,305,504 |
| The Vinyl Factory Limited (Registered number: 04184222) |
| Consolidated Other Comprehensive Income |
| for the Year Ended 29 February 2020 |
| 2020 | 2019 |
| Notes | £ | £ |
| PROFIT FOR THE YEAR | 3,032,933 | 4,305,504 |
| OTHER COMPREHENSIVE INCOME |
| Exchange differences on translation of |
| foreign operations | (1,006 | ) | (934,577 | ) |
| Revaluation of freehold property | (700,000 | ) | 400,000 |
| Income tax relating to components of other comprehensive income |
- |
- |
| OTHER COMPREHENSIVE INCOME FOR THE YEAR, NET OF INCOME TAX |
(701,006 |
) |
(534,577 |
) |
| TOTAL COMPREHENSIVE INCOME FOR THE YEAR |
2,331,927 |
3,770,927 |
| Total comprehensive income attributable to: |
| Owners of the parent | (492,717 | ) | 877,171 |
| Non-controlling interests | 2,824,644 | 2,893,756 |
| 2,331,927 | 3,770,927 |
| The Vinyl Factory Limited (Registered number: 04184222) |
| Consolidated Balance Sheet |
| 29 February 2020 |
| 2020 | 2019 |
| Notes | £ | £ | £ | £ |
| FIXED ASSETS |
| Intangible assets | 10 | 34,400 | 24,371 |
| Tangible assets | 11 | 13,509,322 | 12,936,789 |
| Investments | 12 |
| Interest in joint venture |
| Share of gross assets | 9,216,406 | 8,051,432 |
| Investment property | 13 | 140,972,268 | 134,537,782 |
| 163,732,396 | 155,550,374 |
| CURRENT ASSETS |
| Stocks | 14 | 23,228,129 | 23,004,691 |
| Debtors | 15 | 7,922,846 | 6,016,048 |
| Cash at bank and in hand | 935,114 | 3,082,642 |
| 32,086,089 | 32,103,381 |
| CREDITORS |
| Amounts falling due within one year | 16 | 8,375,832 | 7,466,709 |
| NET CURRENT ASSETS | 23,710,257 | 24,636,672 |
| TOTAL ASSETS LESS CURRENT LIABILITIES |
187,442,653 |
180,187,046 |
| CREDITORS |
| Amounts falling due after more than one year |
17 |
(104,688,092 |
) |
(99,901,303 |
) |
| PROVISIONS FOR LIABILITIES | 21 | (1,898,935 | ) | (1,761,294 | ) |
| NET ASSETS | 80,855,626 | 78,524,449 |
| CAPITAL AND RESERVES |
| Called up share capital | 22 | 60,002 | 60,002 |
| Revaluation reserve | 23 | 4,983,960 | 5,727,102 |
| Other reserves | 23 | 45,601,963 | 40,855,275 |
| Retained earnings | 23 | (5,074,012 | ) | (576,999 | ) |
| SHAREHOLDERS' FUNDS | 45,571,913 | 46,065,380 |
| NON-CONTROLLING INTERESTS | 24 | 35,283,713 | 32,459,069 |
| TOTAL EQUITY | 80,855,626 | 78,524,449 |
| The financial statements were approved by the director and authorised for issue on 7 May 2021 and were signed by: |
| T J Robinson - Director |
| The Vinyl Factory Limited (Registered number: 04184222) |
| Company Balance Sheet |
| 29 February 2020 |
| 2020 | 2019 |
| Notes | £ | £ | £ | £ |
| FIXED ASSETS |
| Intangible assets | 10 | 34,400 | 24,372 |
| Tangible assets | 11 |
| Investments | 12 |
| Investment property | 13 |
| CURRENT ASSETS |
| Stocks | 14 |
| Debtors | 15 |
| Cash at bank |
| CREDITORS |
| Amounts falling due within one year | 16 |
| NET CURRENT (LIABILITIES)/ASSETS | ( |
) |
| TOTAL ASSETS LESS CURRENT LIABILITIES |
| CREDITORS |
| Amounts falling due after more than one year |
17 |
( |
) |
( |
) |
| PROVISIONS FOR LIABILITIES | 21 | ( |
) | ( |
) |
| NET ASSETS |
| CAPITAL AND RESERVES |
| Called up share capital | 22 |
| Other reserves | 23 |
| Retained earnings | 23 | ( |
) | ( |
) |
| SHAREHOLDERS' FUNDS |
| Company's loss for the financial year | (4,661,730 | ) | (2,532,887 | ) |
| The financial statements were approved by the director and authorised for issue on |
| The Vinyl Factory Limited (Registered number: 04184222) |
| Consolidated Statement of Changes in Equity |
| for the Year Ended 29 February 2020 |
| Called up |
| share | Retained | Revaluation |
| capital | earnings | reserve |
| £ | £ | £ |
| Balance at 1 March 2018 | 60,002 | 3,221,517 | 5,690,436 |
| Changes in equity |
| Total comprehensive income | - | (3,798,516 | ) | 36,666 |
| Balance at 28 February 2019 | 60,002 | (576,999 | ) | 5,727,102 |
| Changes in equity |
| Total comprehensive income | - | (4,497,013 | ) | (743,142 | ) |
| Balance at 29 February 2020 | 60,002 | (5,074,012 | ) | 4,983,960 |
| Other | Non-controlling | Total |
| reserves | Total | interests | equity |
| £ | £ | £ | £ |
| Balance at 1 March 2018 | 37,064,745 | 46,036,700 | 29,565,313 | 75,602,013 |
| Changes in equity |
| Total comprehensive income | 3,790,530 | 28,680 | 2,893,756 | 2,922,436 |
| Balance at 28 February 2019 | 40,855,275 | 46,065,380 | 32,459,069 | 78,524,449 |
| Changes in equity |
| Total comprehensive income | 4,746,688 | (493,467 | ) | 2,824,644 | 2,331,177 |
| Balance at 29 February 2020 | 45,601,963 | 45,571,913 | 35,283,713 | 80,855,626 |
| The Vinyl Factory Limited (Registered number: 04184222) |
| Company Statement of Changes in Equity |
| for the Year Ended 29 February 2020 |
| Called up |
| share | Retained | Other | Total |
| capital | earnings | reserves | equity |
| £ | £ | £ | £ |
| Balance at 1 March 2018 | ( |
) |
| Prior year adjustment | - | ( |
) | - | ( |
) |
| As restated | ( |
) |
| Changes in equity |
| Total comprehensive income | - | ( |
) | ( |
) |
| Balance at 28 February 2019 | ( |
) |
| Changes in equity |
| Total comprehensive income | - | ( |
) | ( |
) | ( |
) |
| Balance at 29 February 2020 | ( |
) |
| The Vinyl Factory Limited (Registered number: 04184222) |
| Consolidated Cash Flow Statement |
| for the Year Ended 29 February 2020 |
| 2020 | 2019 |
| Notes | £ | £ |
| Cash flows from operating activities |
| Cash generated from operations | 1 | 2,473,876 | 5,965,448 |
| Interest paid | (6,329,491 | ) | (6,478,854 | ) |
| Foreign exchange differences | (390 | ) | (54,425 | ) |
| Foreign exchange on opening balances | 1,764 | 2,021,898 |
| Tax paid | (631,594 | ) | 147,543 |
| Net cash from operating activities | (4,485,835 | ) | 1,601,610 |
| Cash flows from investing activities |
| Purchase of intangible fixed assets | (20,000 | ) | (10,000 | ) |
| Purchase of tangible fixed assets | (1,678,477 | ) | (1,559,125 | ) |
| Purchase of fixed asset investments | (1,165,159 | ) | - |
| Purchase of investment property | - | (50,981 | ) |
| Sale of tangible fixed assets | - | 59,613 |
| Sale of investment property | 684,334 | 1,078,466 |
| Interest received | 26,744 | 23,928 |
| Net cash from investing activities | (2,152,558 | ) | (458,099 | ) |
| Cash flows from financing activities |
| New loans in year | 26,137,633 | - |
| Loan repayments in year | (21,646,768 | ) | - |
| Capital repayments in year | - | (1,864,565 | ) |
| Increase on loan from foreign entities | - | 28,531 |
| Net cash from financing activities | 4,490,865 | (1,836,034 | ) |
| Decrease in cash and cash equivalents | (2,147,528 | ) | (692,523 | ) |
| Cash and cash equivalents at beginning of year |
2 |
3,082,642 |
3,775,165 |
| Cash and cash equivalents at end of year | 2 | 935,114 | 3,082,642 |
| The Vinyl Factory Limited (Registered number: 04184222) |
| Notes to the Consolidated Cash Flow Statement |
| for the Year Ended 29 February 2020 |
| 1. | RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS |
| 2020 | 2019 |
| £ | £ |
| Profit before taxation | 3,358,328 | 4,846,337 |
| Depreciation charges | 415,237 | 449,527 |
| Loss/(profit) on disposal of fixed assets | 681 | (20,772 | ) |
| Gain on revaluation of fixed assets | (7,121,768 | ) | (7,994,568 | ) |
| Movement on due from joint ventures | 94,547 | - |
| Finance costs | 6,329,491 | 6,478,854 |
| Finance income | (26,744 | ) | (23,928 | ) |
| 3,049,772 | 3,735,450 |
| (Increase)/decrease in stocks | (223,438 | ) | 262,993 |
| (Increase)/decrease in trade and other debtors | (1,971,108 | ) | 1,605,854 |
| Increase in trade and other creditors | 1,618,650 | 361,151 |
| Cash generated from operations | 2,473,876 | 5,965,448 |
| 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 29 February 2020 |
| 29.2.20 | 1.3.19 |
| £ | £ |
| Cash and cash equivalents | 935,114 | 3,082,642 |
| Year ended 28 February 2019 |
| 28.2.19 | 1.3.18 |
| £ | £ |
| Cash and cash equivalents | 3,082,642 | 3,775,165 |
| 3. | ANALYSIS OF CHANGES IN NET DEBT |
| At 1.3.19 | Cash flow | At 29.2.20 |
| £ | £ | £ |
| Net cash |
| Cash at bank and in hand | 3,082,642 | (2,147,528 | ) | 935,114 |
| 3,082,642 | (2,147,528 | ) | 935,114 |
| Debt |
| Debts falling due within 1 year | (807,453 | ) | (482,262 | ) | (1,289,715 | ) |
| Debts falling due after 1 year | (83,437,230 | ) | (4,008,603 | ) | (87,445,833 | ) |
| (84,244,683 | ) | (4,490,865 | ) | (88,735,548 | ) |
| Total | (81,162,041 | ) | (6,638,393 | ) | (87,800,434 | ) |
| The Vinyl Factory Limited (Registered number: 04184222) |
| Notes to the Consolidated Financial Statements |
| for the Year Ended 29 February 2020 |
| 1. | STATUTORY INFORMATION |
| The Vinyl Factory Limited is a |
| 2. | ACCOUNTING POLICIES |
| Basis of preparing the financial statements |
| These consolidated and separate financial statements are prepared on a going concern basis, under the historical cost convention, as modified by the recognition of certain financial assets and liabilities measured at fair value. |
| Basis of consolidation |
| The Group consolidated financial statements include the financial statements of the Company and all of its subsidiary undertakings together with the Group's share of the results of associates made up to 29 February 2020. |
| A subsidiary is an entity controlled by the Group. Control is the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities. Where the Group owns less than 50% of the voting powers of an entity but controls the entity by virtue of an agreement with other investors which give it control of the financial and operating policies of the entity it accounts for that entity as a subsidiary. |
| Where a subsidiary has different accounting policies to the Group, adjustments are made to those subsidiary financial statements to apply the Group's accounting policies when preparing the consolidated financial statements. |
| Any subsidiary undertakings or associates sold or acquired during the year are included up to, or from, the dates of change of control or change of significant influence respectively. |
| Where control of a subsidiary is lost, the gain or loss is recognised in the consolidated income statement. The cumulative amounts of any exchange differences on translation, recognised in equity, are not included in the gain or loss on disposal and are transferred to retained earnings. The gain or loss also includes amounts included in other comprehensive income that are required to be reclassified to profit or loss but excludes those amounts that are not required to be reclassified. |
| All intra-Group transactions, balances, income and expenses are eliminated on consolidation. Adjustments are made to eliminate the profit or loss arising on transactions with associates to the extent of the Group's interest in the entity |
| Turnover |
| Group turnover consists of invoiced sales of goods and services, rent received, property sales, hotel revenue and online advertising income excluding value added tax. |
| Goodwill |
| Negative goodwill has been generated on the purchase of part of a business in this financial year, where the cost of the acquisition was less than the fair value of the assets acquired. The negative goodwill has been recognised in current period in line with FRS 102 as this is the the period in which its benefit is derived. |
| Intangible assets |
| Intangible assets are initially measured at cost. After initial recognition, intangible assets are measured at cost |
| less any accumulated amortisation and any accumulated impairment losses. |
| Development costs are being amortised evenly over their estimated useful life of 3 and 10 years. |
| The Vinyl Factory Limited (Registered number: 04184222) |
| Notes to the Consolidated Financial Statements - continued |
| for the Year Ended 29 February 2020 |
| 2. | ACCOUNTING POLICIES - continued |
| Tangible fixed assets |
| Long leasehold | - |
| Improvements to property | - |
| Plant, machinery and hotel equipment | - |
| Furnishings, artwork and fixtures | - |
| Motor vehicles | - |
| Computer equipment | - |
| Leasehold Property |
| The Companies Act 2006 requires all properties to be depreciated. However, this requirement conflicts with the generally accepted accounting principle set out in FRS 102. The directors consider that, because these properties are not held for consumption, but for their investment potential, to depreciate them would not give a true and fair view and that it is necessary to adopt the valuation method under FRS 102 in order to give a true and fair view.The properties are to be subject to an annual revaluation. |
| Investment property |
| Investment property is shown at its most recent valuation and is subject to annual reviews to fair value. Any aggregate surplus or deficit arising from changes in fair value is recognised in profit and loss. |
| Stocks |
| Stocks and work in progress are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items. |
| Cost is calculated using the first-in, first-out method and includes all purchase, transport, and handling costs in bringing stocks to their present location and condition. |
| Taxation |
| Taxation for the year comprises current and deferred tax. Tax is recognised in the Consolidated 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. |
| Pension costs and other post-retirement benefits |
| The companies within the group operates a defined contribution pension scheme. Contributions payable to each company's pension scheme are charged to the profit and loss account in the period they relate. |
| The Vinyl Factory Limited (Registered number: 04184222) |
| Notes to the Consolidated Financial Statements - continued |
| for the Year Ended 29 February 2020 |
| 3. | TURNOVER |
| The turnover and profit before taxation are attributable to the principal activities of the group. |
| An analysis of turnover by class of business is given below: |
| 2020 | 2019 |
| £ | £ |
| An analysis of turnover by geographical market is given below: |
| 2020 | 2019 |
| £ | £ |
| United Kingdom |
| Europe |
| 4. | EMPLOYEES AND DIRECTORS |
| 2020 | 2019 |
| £ | £ |
| Wages and salaries |
| Social security costs |
| Other pension costs |
| The average number of employees during the year was as follows: |
| 2020 | 2019 |
| Factory staff | 29 | 25 |
| Hotel staff | 144 | 158 |
| Record shop staff | 16 | 16 |
| Shop staff | 19 | 18 |
| Group staff | 32 | 35 |
| 2020 | 2019 |
| £ | £ |
| Director's remuneration |
| Director's pension contributions to money purchase schemes |
| The Vinyl Factory Limited (Registered number: 04184222) |
| Notes to the Consolidated Financial Statements - continued |
| for the Year Ended 29 February 2020 |
| 5. | OPERATING PROFIT |
| The operating profit is stated after charging/(crediting): |
| 2020 | 2019 |
| £ | £ |
| Hire of plant and machinery |
| Other operating leases |
| Depreciation - owned assets |
| Loss/(profit) on disposal of fixed assets | ( |
) |
| Development costs amortisation |
| Auditors' remuneration |
| Auditors' remuneration for non audit work |
| Foreign exchange differences | ( |
) |
| 6. | EXCEPTIONAL ITEMS |
| 2020 | 2019 |
| £ | £ |
| Exceptional income | 3,358,188 | - |
| Impairment | ( |
) | ( |
) |
| (741,027 | ) | (982,925 | ) |
| Parent Company Financial Statements |
| During the period a provision of £802,572 (2019: £897,804) was made against amounts due from certain subsidiary undertakings. The director of the company considers the amounts to be recoverable but has adopted a prudent approach and provided for all debt to the extent it is not covered by the net assets of the subsidiary undertakings. The debts are still due and are reflected in full in the balance sheets of the subsidiary companies. The position is under constant review and will be subject to an overall assessment in future periods. |
| During the period there was a provision of £4,099,215 (2019: £982,925) for amounts due from a joint venture undertaking. The directors of the company considers the amounts to be recoverable but has adopted a prudent approach and provided for all the debt. The debts are still due and are reflected in full in the balance sheets of the relevant companies. The position is under constant review and will be subject to an overall assessment in future periods as the balance is in relation to a start up business. |
| Group Consolidated Financial Statements |
| During the period a provision of £4,099,215 (2019: £982,925) was made against amounts due from a joint venture undertaking. The directors of the company considers the amounts to be recoverable but has adopted a prudent approach and provided for all the debt. The debts are still due and are reflected in full in the balance sheets of the relevant companies. The position is under constant review and will be subject to an overall assessment in future periods as the balance is in relation to a start up business. |
| Exceptional Income |
| During the year Torstraße 1 Berlin S.à.r.l received an Investment Grant of €3,921,239 (£3,358,188) (Infestations) according to German Institutionalization's following the investments made by Torstraße 1 Berlin S.à.r.l in the redevelopment of the Berlin building, Torstraße 1. This Investment Grant was linked to certain investments made at the time in the former eastern part of Germany and was provided by the Republic of Germany. |
| 7. | INTEREST PAYABLE AND SIMILAR EXPENSES |
| 2020 | 2019 |
| £ | £ |
| Bank and loan interest |
| Bond and loan interest |
| Interest on joint venture loan |
| Other interest |
| The Vinyl Factory Limited (Registered number: 04184222) |
| Notes to the Consolidated Financial Statements - continued |
| for the Year Ended 29 February 2020 |
| 8. | TAXATION |
| Analysis of the tax charge |
| The tax charge on the profit for the year was as follows: |
| 2020 | 2019 |
| £ | £ |
| Current tax: |
| Prior year overprovision | 282 | (2,391 | ) |
| Foreign income tax | 187,472 | 380,058 |
| Total current tax |
| Deferred tax |
| Tax on profit |
| Reconciliation of total tax charge included in profit and loss |
| The tax assessed for the year is lower than the standard rate of corporation tax in the UK. The difference is explained below: |
| 2020 | 2019 |
| £ | £ |
| Profit before tax |
| Profit multiplied by the standard rate of corporation tax in the UK of (2019 - |
| Effects of: |
| Expenses not deductible for tax purposes |
| Capital allowances in excess of depreciation | ( |
) | ( |
) |
| Adjustments to tax charge in respect of previous periods | ( |
) |
| Revaluation adjustment | (1,353,136 | ) | (1,594,968 | ) |
| Foreign tax charge | 187,472 | 380,057 |
| Losses carried forward | 1,783,887 | 495,363 |
| Overseas entities not subject to UK taxation | (810,418 | ) | (233,930 | ) |
| Consolidation adjustments to profit not taxable | (907,036 | ) | 267,676 |
| Impairment and effect of change of tax rates | 778,851 | 186,756 |
| Deferred tax charge | 137,641 | 163,166 |
| Total tax charge | 325,395 | 540,833 |
| Tax effects relating to effects of other comprehensive income |
| 2020 |
| Gross | Tax | Net |
| £ | £ | £ |
| Exchange differences on translation of |
| foreign operations | ( |
) | - | (1,006 | ) |
| Revaluation of freehold property | ( |
) | - | (700,000 | ) |
| (701,006 | ) | - | (701,006 | ) |
| 2019 |
| Gross | Tax | Net |
| £ | £ | £ |
| Exchange differences on translation of |
| foreign operations | ( |
) | - | (934,577 | ) |
| Revaluation of freehold property | - | 400,000 |
| (534,577 | ) | - | (534,577 | ) |
| The Vinyl Factory Limited (Registered number: 04184222) |
| Notes to the Consolidated Financial Statements - continued |
| for the Year Ended 29 February 2020 |
| 9. | INDIVIDUAL INCOME STATEMENT |
| As permitted by Section 408 of the Companies Act 2006, the Income Statement of the parent company is not presented as part of these financial statements. |
| 10. | INTANGIBLE FIXED ASSETS |
| Group |
| Development |
| Goodwill | costs | Totals |
| £ | £ | £ |
| COST |
| At 1 March 2019 | 1,578,630 | 156,524 |
| Additions |
| At 29 February 2020 | 1,578,630 | 176,524 |
| AMORTISATION |
| At 1 March 2019 | 1,578,630 | 132,153 |
| Amortisation for year | - | 9,971 |
| At 29 February 2020 | 1,578,630 | 142,124 |
| NET BOOK VALUE |
| At 29 February 2020 |
| At 28 February 2019 | - | 24,371 |
| Company |
| Development |
| costs |
| £ |
| COST |
| At 1 March 2019 | 83,271 |
| Additions |
| At 29 February 2020 | 103,271 |
| AMORTISATION |
| At 1 March 2019 | 58,899 |
| Amortisation for year | 9,972 |
| At 29 February 2020 | 68,871 |
| NET BOOK VALUE |
| At 29 February 2020 |
| At 28 February 2019 | 24,372 |
| The Vinyl Factory Limited (Registered number: 04184222) |
| Notes to the Consolidated Financial Statements - continued |
| for the Year Ended 29 February 2020 |
| 11. | TANGIBLE FIXED ASSETS |
| Group |
| Plant, |
| Improvements | machinery |
| Freehold | Long | to | and hotel |
| property | leasehold | property | equipment |
| £ | £ | £ | £ |
| COST OR VALUATION |
| At 1 March 2019 | 7,400,000 | 662,500 | 953,805 | 2,820,985 |
| Additions | - | - | 19,321 | 582,510 |
| Disposals | - | - | - | - |
| Revaluations | (700,000 | ) | - | - | - |
| At 29 February 2020 | 6,700,000 | 662,500 | 973,126 | 3,403,495 |
| DEPRECIATION |
| At 1 March 2019 | - | - | 623,495 | 1,930,830 |
| Charge for year | - | - | 70,889 | 247,376 |
| Eliminated on disposal | - | - | - | - |
| At 29 February 2020 | - | - | 694,384 | 2,178,206 |
| NET BOOK VALUE |
| At 29 February 2020 | 6,700,000 | 662,500 | 278,742 | 1,225,289 |
| At 28 February 2019 | 7,400,000 | 662,500 | 330,310 | 890,155 |
| Furnishings, |
| artwork |
| and | Motor | Computer |
| fixtures | vehicles | equipment | Totals |
| £ | £ | £ | £ |
| COST OR VALUATION |
| At 1 March 2019 | 3,910,389 | 122,571 | 661,246 | 16,531,496 |
| Additions | 1,030,602 | - | 46,044 | 1,678,477 |
| Disposals | (2,950 | ) | - | - | (2,950 | ) |
| Revaluations | - | - | - | (700,000 | ) |
| At 29 February 2020 | 4,938,041 | 122,571 | 707,290 | 17,507,023 |
| DEPRECIATION |
| At 1 March 2019 | 428,183 | 69,641 | 542,558 | 3,594,707 |
| Charge for year | 56,046 | 9,923 | 21,029 | 405,263 |
| Eliminated on disposal | (2,269 | ) | - | - | (2,269 | ) |
| At 29 February 2020 | 481,960 | 79,564 | 563,587 | 3,997,701 |
| NET BOOK VALUE |
| At 29 February 2020 | 4,456,081 | 43,007 | 143,703 | 13,509,322 |
| At 28 February 2019 | 3,482,206 | 52,930 | 118,688 | 12,936,789 |
| The Vinyl Factory Limited (Registered number: 04184222) |
| Notes to the Consolidated Financial Statements - continued |
| for the Year Ended 29 February 2020 |
| 11. | TANGIBLE FIXED ASSETS - continued |
| Group |
| Cost or valuation at 29 February 2020 is represented by: |
| Plant, |
| Improvements | machinery |
| Freehold | Long | to | and hotel |
| property | leasehold | property | equipment |
| £ | £ | £ | £ |
| Valuation in 2013 | 1,138,426 | - | - | - |
| Valuation in 2014 | 2,396,757 | - | - | - |
| Valuation in 2015 | 984,068 | - | - | - |
| Valuation in 2016 | 890,175 | - | - | - |
| Valuation in 2017 | 200,000 | - | - | - |
| Valuation in 2019 | 400,000 | - | - | - |
| Valuation in 2020 | (700,000 | ) | - | - | - |
| Cost | 1,390,574 | 662,500 | 973,126 | 3,403,495 |
| 6,700,000 | 662,500 | 973,126 | 3,403,495 |
| Furnishings, |
| artwork |
| and | Motor | Computer |
| fixtures | vehicles | equipment | Totals |
| £ | £ | £ | £ |
| Valuation in 2013 | - | - | - | 1,138,426 |
| Valuation in 2014 | - | - | - | 2,396,757 |
| Valuation in 2015 | - | - | - | 984,068 |
| Valuation in 2016 | - | - | - | 890,175 |
| Valuation in 2017 | - | - | - | 200,000 |
| Valuation in 2019 | - | - | - | 400,000 |
| Valuation in 2020 | - | - | - | (700,000 | ) |
| Cost | 4,938,041 | 122,571 | 707,290 | 12,197,597 |
| 4,938,041 | 122,571 | 707,290 | 17,507,023 |
| JLL (Jones Lang LaSalle) have valued the investment properties as at the 29 February 2020 on an open market basis. The independent valuers have the relevant professional qualifications and recent experience in the location and category of the investment property. |
| Company |
| Plant, | Furnishings, |
| machinery | artwork |
| and hotel | and | Motor |
| equipment | fixtures | vehicles | Totals |
| £ | £ | £ | £ |
| COST |
| At 1 March 2019 |
| Additions |
| At 29 February 2020 |
| DEPRECIATION |
| At 1 March 2019 |
| Charge for year |
| At 29 February 2020 |
| NET BOOK VALUE |
| At 29 February 2020 |
| At 28 February 2019 |
| The Vinyl Factory Limited (Registered number: 04184222) |
| Notes to the Consolidated Financial Statements - continued |
| for the Year Ended 29 February 2020 |
| 12. | FIXED ASSET INVESTMENTS |
| Group |
| Interest |
| in joint |
| venture |
| £ |
| COST |
| At 1 March 2019 | 8,051,432 |
| Additions | 1,165,159 |
| Exchange differences | (185 | ) |
| At 29 February 2020 | 9,216,406 |
| NET BOOK VALUE |
| At 29 February 2020 | 9,216,406 |
| At 28 February 2019 | 8,051,432 |
| Company |
| Shares in | Interest |
| group | in joint |
| undertakings | venture | Totals |
| £ | £ | £ |
| COST |
| At 1 March 2019 |
| and 29 February 2020 | 1,089,594 |
| NET BOOK VALUE |
| At 29 February 2020 | 1,089,594 |
| At 28 February 2019 | 1,089,594 |
| The group or the company's investments at the Balance Sheet date in the share capital of companies include the following: |
| Subsidiaries |
| Registered office: 15 Newland, Lincoln, LN1 1XG |
| Nature of business: |
| % |
| Class of shares: | holding |
| Registered office: 15 Newland, Lincoln, LN1 1XG |
| Nature of business: |
| % |
| Class of shares: | holding |
| Registered office: 15 Newland, Lincoln, LN1 1XG |
| Nature of business: |
| % |
| Class of shares: | holding |
| The Vinyl Factory Limited (Registered number: 04184222) |
| Notes to the Consolidated Financial Statements - continued |
| for the Year Ended 29 February 2020 |
| 12. | FIXED ASSET INVESTMENTS - continued |
| Registered office: 15 Newland, Lincoln, LN1 1XG |
| Nature of business: |
| % |
| Class of shares: | holding |
| Registered office: 15 Newland, Lincoln, LN1 1XG |
| Nature of business: |
| % |
| Class of shares: | holding |
| Registered office: 15 Newland, Lincoln, LN1 1XG |
| Nature of business: |
| % |
| Class of shares: | holding |
| Registered office: 15 Newland, Lincoln, LN1 1XG |
| Nature of business: |
| % |
| Class of shares: | holding |
| Registered office: 15 Newland, Lincoln, LN1 1XG |
| Nature of business: |
| % |
| Class of shares: | holding |
| Registered office: 15 Newland, Lincoln, LN1 1XG |
| Nature of business: |
| % |
| Class of shares: | holding |
| Registered office: 5 Rue Guillaume Kroll L-1882 Luxembourg |
| Nature of business: |
| % |
| Class of shares: | holding |
| Registered office: 5 Rue Guillaume Kroll L-1882 Luxembourg |
| Nature of business: |
| % |
| Class of shares: | holding |
| Joint ventures |
| Registered office: |
| Nature of business: |
| % |
| Class of shares: | holding |
| The Vinyl Factory Limited (Registered number: 04184222) |
| Notes to the Consolidated Financial Statements - continued |
| for the Year Ended 29 February 2020 |
| 12. | FIXED ASSET INVESTMENTS - continued |
| Registered office: 5 Rue Guillaume Kroll L-1882 Luxembourg |
| Nature of business: |
| % |
| Class of shares: | holding |
| 13. | INVESTMENT PROPERTY |
| Group |
| Total |
| £ |
| FAIR VALUE |
| At 1 March 2019 | 134,537,782 |
| Disposals | (684,334 | ) |
| Revaluations | 7,121,768 |
| Exchange differences | (2,948 | ) |
| At 29 February 2020 | 140,972,268 |
| NET BOOK VALUE |
| At 29 February 2020 | 140,972,268 |
| At 28 February 2019 | 134,537,782 |
| Fair value at 29 February 2020 is represented by: |
| £ |
| Cost | 63,256,918 |
| Valuations to date | 67,413,759 |
| Exchange rate gains | 10,301,591 |
| 140,972,268 |
| Torstrasse 1 Berlin Sarl |
| The Investment property was valued on an open market basis as at the 29 February 2020 by Savills Immobilien Beratungs GmbH. The independent valuers undertaking the valuation have the relevant professional qualifications and recent experience in the location and category of the investment property. |
| The Vinyl Factory Limited |
| JLL (Jones Lang LaSalle) have valued the investment properties as at the 29 February 2020 on an open market basis. The independent valuers have the relevant professional qualifications and recent experience in the location and category of the investment property. |
| Vinyl Space Limited |
| Investment properties were subject to valuation by the director who has a professional qualification from the Royal Institution of Chartered Surveyors although he is no longer a practising member. |
| The methods and significant assumptions used to ascertain the fair value of £3,000,000 are as follows: |
| The original purchase price of the property was used and adjusted for capital improvements. This was then uplifted in line with current market data for similar comparable properties within the surrounding area. |
| The Vinyl Factory Limited (Registered number: 04184222) |
| Notes to the Consolidated Financial Statements - continued |
| for the Year Ended 29 February 2020 |
| 13. | INVESTMENT PROPERTY - continued |
| Company |
| Total |
| £ |
| FAIR VALUE |
| At 1 March 2019 |
| Revaluations | (600,000 | ) |
| At 29 February 2020 |
| NET BOOK VALUE |
| At 29 February 2020 |
| At 28 February 2019 |
| Fair value at 29 February 2020 is represented by: |
| £ |
| Valuation in 2009 | 1,750,000 |
| Valuation in 2010 | (174,145 | ) |
| Valuation in 2012 | 450,000 |
| Valuation in 2014 | 4,264,950 |
| Valuation in 2015 | 1,751,062 |
| Valuation in 2016 | 1,583,730 |
| Valuation in 2017 | 325,000 |
| Valuation in 2018 | (155,000 | ) |
| Valuation in 2019 | 430,000 |
| Valuation in 2020 | (600,000 | ) |
| Cost | 2,474,403 |
| 12,100,000 |
| JLL (Jones Lang LaSalle) have valued the investment properties as at the 28 February 2020 on an open market basis. The independent valuers have the relevant professional qualifications and recent experience in the location and category of the investment property. |
| 14. | STOCKS |
| Group | Company |
| 2020 | 2019 | 2020 | 2019 |
| £ | £ | £ | £ |
| Stocks | 19,045,942 | 18,802,931 |
| Raw materials | 139,193 | 119,318 |
| Work-in-progress | 33,965 | 53,602 |
| Finished goods | 1,162,370 | 828,244 |
| Artwork and antiques | 2,846,659 | 3,200,596 | 2,846,659 | 3,200,596 |
| 23,228,129 | 23,004,691 |
| The Vinyl Factory Limited (Registered number: 04184222) |
| Notes to the Consolidated Financial Statements - continued |
| for the Year Ended 29 February 2020 |
| 15. | DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
| Group | Company |
| 2020 | 2019 | 2020 | 2019 |
| £ | £ | £ | £ |
| Trade debtors | 350,186 | 2,292,835 |
| Amounts owed by group undertakings | - | - |
| Amounts owed by joint ventures | - | 64,310 |
| Other debtors | 1,378,510 | 1,497,977 |
| Related company loans | 3,808,856 | 928,856 | 3,808,856 | 928,856 |
| VAT | 644,893 | - |
| Prepayments and accrued income | 1,740,401 | 1,232,070 |
| 7,922,846 | 6,016,048 |
| 16. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
| Group | Company |
| 2020 | 2019 | 2020 | 2019 |
| £ | £ | £ | £ |
| Bank loans and overdrafts (see note 18) | 1,289,715 | 807,453 |
| Trade creditors | 2,769,459 | 2,125,797 |
| Amounts owed to group undertakings | - | - |
| Taxation | 147,846 | 591,686 |
| Social security and other taxes | - | 1,410,924 |
| Other creditors | 1,853,129 | 877,313 |
| Accruals and deferred income | 2,315,683 | 1,653,536 |
| 8,375,832 | 7,466,709 |
| 17. | CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR |
| Group | Company |
| 2020 | 2019 | 2020 | 2019 |
| £ | £ | £ | £ |
| Bank loans (see note 18) | 57,991,938 | 33,391,492 |
| Other loans (see note 18) | 29,453,895 | 50,045,738 |
| Amounts owed to joint ventures | 4,727,900 | 4,697,663 | - | - |
| Other creditors | 5,291,919 | 6,314,727 |
| Retentions | 797,000 | 797,000 | - | - |
| Related company loans | 415,414 | 448,314 | 415,414 | 448,314 |
| Accruals and deferred income | 6,010,026 | 4,206,369 |
| 104,688,092 | 99,901,303 |
| The Vinyl Factory Limited (Registered number: 04184222) |
| Notes to the Consolidated Financial Statements - continued |
| for the Year Ended 29 February 2020 |
| 18. | LOANS |
| An analysis of the maturity of loans is given below: |
| Group |
| 2020 | 2019 |
| £ | £ |
| Amounts falling due within one year or on | demand: |
| Bank loans | 1,289,715 | 807,453 |
| Amounts falling due between one and two | years: |
| Bank loans | 57,991,938 | 33,363,290 |
| Amounts falling due between two and five | years: |
| Bank loans | - | 28,202 |
| Other loans | 29,453,895 | 50,045,738 |
| 29,453,895 | 50,073,940 |
| 19. | SECURED DEBTS |
| The following secured debts are included within creditors: |
| Group |
| 2020 | 2019 |
| £ | £ |
| Bank loans | 59,281,653 | 34,198,945 |
| Other loans | 29,453,895 | 50,045,738 |
| 88,735,548 | 84,244,683 |
| 'Other loans' represents those taken out by the issue of a series of 'zero coupon discounted bonds' - Bond Finance. |
| Within the Group such finance is cross collateralised in the ordinary course of business by Group companies, properties owned by related companies and by properties owned by the shareholders of the Company (all in the ordinary course of business). |
| The shareholders of the Company as referred to are the guarantors of last resort. |
| The existing 'bank loan' is secured against the assets of the Group's foreign subsidiary. |
| The Vinyl Factory Limited (Registered number: 04184222) |
| Notes to the Consolidated Financial Statements - continued |
| for the Year Ended 29 February 2020 |
| 20. | FINANCIAL INSTRUMENTS |
| The Bond Finance has been allocated (in the ordinary course of business) to Group companies, related companies and the shareholders of the parent Company. |
| The allocation relating to the Group is shown within 'Other loans'. |
| The discount on the issue of the Bond Finance relating to the group was amortised up to the year end and is shown as an interest charge in the group's profit and loss account. |
| The Bond Finance for the UK companies (including amounts owed by the other entities) are redeemable at a future date. |
| The total discount on the Bond Finance is calculated to the projected redemption date and on the issue thereof the said discount attributable to the Group is £7,888,511 of which £6,836,714 has been accrued to date within these Financial Statements. |
| The foreign entity in the Group has taken out separate Bond Finance (in the ordinary course of business) - see above. |
| The total discount on the issue of the Bond Finance attributable to the foreign entity within the group is £452,420 of which £329,117 has been accrued to date within these Financial Statements. |
| The value of the Bond Finance varies from year to year subject to any reallocation which in itself would not impact the net assets as presented in the Balance Sheet. |
| The Bond Finance was originally scheduled to mature on the 31st May 2018. |
| A refinancing has now meant that an interest rate of 10% per annum has been charged until the revised Maturity Date of 31st May 2020. |
| 21. | PROVISIONS FOR LIABILITIES |
| Group | Company |
| 2020 | 2019 | 2020 | 2019 |
| £ | £ | £ | £ |
| Deferred tax | 1,898,935 | 1,761,294 | 1,734,664 | 1,657,898 |
| Group |
| Deferred |
| tax |
| £ |
| Balance at 1 March 2019 | 1,761,294 |
| Accelerated capital allowances | 60,876 |
| On revaluation of properties | 76,765 |
| Balance at 29 February 2020 | 1,898,935 |
| Company |
| Deferred |
| tax |
| £ |
| Balance at 1 March 2019 |
| Deferred tax on revaluation | 76,766 |
| Balance at 29 February 2020 |
| 22. | CALLED UP SHARE CAPITAL |
| Allotted and issued: |
| Number: | Class: | Nominal | 2020 | 2019 |
| value: | £ | £ |
| Ordinary | £1.00 | 60,002 | 60,002 |
| The Vinyl Factory Limited (Registered number: 04184222) |
| Notes to the Consolidated Financial Statements - continued |
| for the Year Ended 29 February 2020 |
| 23. | RESERVES |
| Group |
| Retained | Revaluation | Other |
| earnings | reserve | reserves | Totals |
| £ | £ | £ | £ |
| At 1 March 2019 | (576,999 | ) | 5,727,102 | 40,855,275 | 46,005,378 |
| Profit for the year | 207,539 | 207,539 |
| Revaluation adjustments | (4,704,413 | ) | (743,142 | ) | 4,747,555 | (700,000 | ) |
| Exchange differences |
| translating foreign operations | (139 | ) | - | (867 | ) | (1,006 | ) |
| At 29 February 2020 | (5,074,012 | ) | 4,983,960 | 45,601,963 | 45,511,911 |
| Company |
| Retained | Other |
| earnings | reserves | Totals |
| £ | £ | £ |
| At 1 March 2019 | ( |
) | 5,536,121 |
| Deficit for the year | ( |
) | ( |
) |
| Revaluation adjustments | 676,766 | (676,766 | ) | - |
| At 29 February 2020 | ( |
) | 874,391 |
| 24. | NON-CONTROLLING INTERESTS |
| Vinyl Factory Limited hold 80% of the shares in Vinyl Factory Music Limited with the other 20% held by a minority interest and is reflected on the consolidated balance sheet. The company has held the shares since the incorporation of Vinyl Factory Music Limited in 2013. |
| Vinyl Factory Limited also holds 66.67% of the shareholding in Torstrasse 1 Berlin Sarl (Formerly: Cresco Capital Torstrasse 1 Berlin Sarl) . The remaining third is held by a minority interest and is reflected on the consolidated balance sheet. |
| The Vinyl Factory Limited (Registered number: 04184222) |
| Notes to the Consolidated Financial Statements - continued |
| for the Year Ended 29 February 2020 |
| 25. | RELATED PARTY DISCLOSURES |
| Included in the group figures are the following related party transactions from the following group companies: |
| The Vinyl Factory Limited (Parent) |
| The company has claimed exemptions under Financial Reporting Standard 102 not to disclose transactions with wholly owned subsidiaries. |
| During the period The Vinyl Factory Limited loaned £Nil (2019: £2,000) to The Vinyl Factory Music Limited, a subsidiary company in which it holds 80% of the share capital. At the year end The Vinyl Factory Music Limited owed the parent company £191,718 (2019: £205,719). An impairment provision has been recognised on this balance. |
| During the period The Vinyl Factory Limited made advances and paid for expenses in the ordinary course of business of £105,071 (2019: £125,489) to Fineyork Limited, a company in which both M Wadhwa and T J Robinson are also shareholders. Fineyork Limited repaid loans and allocated its share of Group VAT totalling £225,853 (2019: £309,182) against the balance. Fineyork Limited paid management charges of £60,000 (2019: £60,000) during the year. The Vinyl Factory Limited paid Fineyork Limited £83,250 (2019: £83,250) in rental income. Fineyork also recharged £100,000 (2019: £100,000) to the Vinyl Factory Limited for rent payable by a shareholder of the Vinyl Factory Limited. The amount owed to Fineyork Limited at 29 February 2020 was £33,252 (2019: £210,780 owing to The Vinyl Factory Limited). |
| Included within Other Debtors due to be received within one year is the sum of £5,555,312 (2019: £4,370,813). This balance refers to loans made to and expenses incurred on behalf of StoreBerlin Limited (a Joint Venture company in which T J Robinson is also a director). An impairment provision has been recognised on this balance. |
| Included within other creditors due in more than one year were amounts owed to Media Office Limited, a company in which M Wadhwa is a director. During the period, Media Office loaned £15,000 (2019: £21,000) to the Vinyl Factory Limited and paid expenses on behalf of Vinyl Factory Limited of £5,500 (2019: £13,188). During the year The Vinyl Factory Limited made loan repayments to Media Office Limited of £32,000 (2019: £244,500) and made payments of behalf of Media Office Limited of £21,400 (2019: £70,396). The amount owed to Media Office Limited as at 29th February 2020 was £415,414 (2019: £448,314). |
| Included within debtors were amounts owed by Brighton Seafront Regeneration Limited of £3,808,856 (2019: £928,856), a company in which M Wadhwa and T J Robinson are directors. These relate to loans and expenses paid on behalf of Brighton Seafront Regeneration Limited by Vinyl Factory Limited in the ordinary course of business. |
| During the year under review, TJ Robinson, the sole director of the company introduced capital of £42,187 (2019: £42,002). Loan repayments totalling £877,829 (2019: £250,403) were received by TJ Robinson so that at the year end the balance owed totalled £2,821,185 (2019: £3,656,827) and is included within 'other creditors' due over one year. |
| During the period under review M Wadhwa as a shareholder of the company introduced capital of £500,012 (2019: £2,069,045). He received loan repayments of £1,274,719 (2019: £1,320,938). At the year end the balance owed to M Wadhwa was £25,675 (2019: £800,382) and is included within 'other creditors' due over one year. |
| The Vinyl Factory Limited (Registered number: 04184222) |
| Notes to the Consolidated Financial Statements - continued |
| for the Year Ended 29 February 2020 |
| UK Subsidiary Undertakings of the Group |
| During the year, UK subsidiary companies made sales and recharges of £14,770 (2019: £106,399) to Fineyork Ltd, a company in which both M Wadhwa and T J Robinson are also shareholders. Fineyork Ltd made recharges of £12,000 (2019: £12,000) to UK subsidiary companies in the year. The net amount outstanding at the year end was £19,770 (2019: £33,398). This amount is included within debtors. |
| During the year, UK subsidiary companies made purchases of £10,130 (2019: £Nil) from Vinyl Factory Music Limited, a company that is an 80% owned subsidiary of the group. The net amount outstanding at the year end was £3,156 (2019: £17,540). This amount is included within debtors. |
| During the year, UK subsidiary companies made total sales amounting to £170,482 (2019: £109,096) and had purchases of £51,274 (2019: £Nil) to Store Berlin Limited, a joint venture undertaking of the group. The amount outstanding at the year end was £14,694 (2019: £109,537 included in debtors). This amount is included within creditors. |
| During the year, UK subsidiary companies received rental income on an arms length basis of £35,000 (2019: £35,000) from the shareholders of the parent company. |
| The shareholders of the parent company also used Vinyl Space Limited 'Hotel facilities and services' during the year amounting to £7,456 (2019: £5,335). This was paid for by the shareholders and there is no balance outstanding at the year end. |
| Vinyl Factory Torstrasse 1 Berlin Sarl |
| During the year Torstrasse 1 Berlin Sarl provided loans to Vinyl Factory Torstrasse 1 Berlin Sarl of £28,592,849 (2019: £2,355,183). Interest was charged in the year of £525,036 (2019: £13,286). The balance due from Vinyl Factory Torstrasse 1 Berlin Sarl at the year end is £31,473,068 (2019: £2,368,349). These balances and amounts have been eliminated on consolidation. |
| Torstrasse 1 Berlin Sarl |
| During the year Torstrasse 1 Berlin Sarl charged rent and service charges of £294,759 (2019: £362,273) to Torstrasse 1 Lofts Limited, a company which has common control and in which T J Robinson is also a director. |
| During the year Torstrasse 1 Berlin Sarl charged rent and service charges of £721,289 (2019: £1,045,151) to Store Berlin Limited, a company which is a joint venture entered into by the parent of the group. The amount outstanding at the year end was £4,532,037 (2019: £2,733,252). An impairment provision has been recognised on this balance. |
| 26. | POST BALANCE SHEET EVENTS |
| Following the year end the United Kingdom was hit by the COVID-19 pandemic with a full lockdown announced on 23 March 2020. |
| The COVID-19 pandemic has developed rapidly since March 2020, with a significant number of cases. Measures taken by the governments to contain the virus have affected the economic activity of the company in various significant ways: |
| - | Due to government measures taken, the hotel first closed for business on the 24th March 2020 and reopened again in July 2020. Subsequently, the hotel was subject to various restrictions including closure on the 4th November, re opening on the 3rd December before the current lockdown forced another full closure on the 18th December 2020. The hotel in Berlin was also impacted for significant periods within 2020 and 2021. |
| - | Due to government measures the retail and event arms of the group were forced to close for periods within 2020 and 2021. Whilst sales online were able to continue during this period, the stores were unable to open and events were cancelled. |
| Due to these effects the revenue of the company significantly dropped in the year to 28 February 2021 and will continue to be impacted in the year to 28 February 2022 where the restrictions are to be phased out. Whilst this is a significant impact on future trade, we expect this to improve with demand returning and aim to re-commence trade in line with the government policies and advice. |
| 27. | ULTIMATE CONTROLLING PARTY |
| Mr M Wadhwa is deemed to control the company by virtue of a 55% shareholding at the year end. |