BMGC Ltd - Limited company accounts 20.1

REGISTERED NUMBER: NI072344 (Northern Ireland)

BMGC LTD

GROUP STRATEGIC REPORT, DIRECTORS' REPORT AND

CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2020

Page

Company Information

1

Group Strategic Report

2

Directors' Report

4

Independent Auditors' Report

6

Consolidated Income Statement

9

Consolidated Statement of Financial Position

10

Company Statement of Financial Position

11

Consolidated Statement of Changes in Equity

12

Company Statement of Changes in Equity

13

Consolidated Statement of Cash Flows

14

Notes to the Consolidated Statement of Cash Flows

15

Notes to the Consolidated Financial Statements

16

DIRECTORS:

Brian Macklin

Mary Macklin

SECRETARY:

Brian Macklin

REGISTERED OFFICE:

26 Wellington Park

Belfast

Co. Antrim

BT9 6DL

REGISTERED NUMBER:

NI072344 (Northern Ireland)

INDEPENDENT AUDITORS:

CavanaghKelly

Chartered Accountants and Statutory Auditors

36-38 Northland Row

Dungannon

Co. Tyrone

BT71 6AP

BANKERS:

Bank of Ireland

364 Lisburn Road

Belfast

Co. Antrim

BT9 6GL

SOLICITORS:

O'Hare Solicitors

St. George's Building

37 - 41 High Street

Belfast

Co. Antrim

BT1 2AB

The directors present their strategic report of the Company and the Group for the year ended 30 June 2020.

RESULTS AND PERFORMANCE

The group's key financial performance indicators during the year were as follows:

2020

2019

2018

Turnover

£16,852,744

£17,197,164

£15,734,295

Gross profit margin

32%

37%

41%

Net profit/(loss) before tax

£(804,566)

£(54,518)

£291,216

The directors are pleased with the results for the year. Revenue has increased however this is largely attributable to new homes being purchased in the prior year. Gross profit has remained consistent with the prior year. Costs have increased within the group and this has impacted on net profits.

BUSINESS ENVIRONMENT

The nursing care and hotel and leisure markets are highly competitive markets throughout Northern Ireland. The group considers itself as having a strong position in the respective markets due to the knowledge of the industry and the provision of a quality service to its residents and guests.

STRATEGY

The group's success is dependent on the ongoing management of business risks and uncertainties it faces. The directors intend to grow the business further as the group establishes a quality service in the market and through better management of costs and improved efficiencies within the business.

PRINCIPAL RISKS AND UNCERTAINTIES

Competition Risk:

Competition comes from similar hotels and care homes in the locality. The directors manage this risk by ensuring a quality service is offered to all residents and guests.

Financial Risk:

The company's operations expose it to financial risk. The group has in place a risk management programme that seeks to limit the adverse effects on the financial performance of the group by monitoring the levels of risk and the related finance costs.

Economic Risk:

Economic risk is inherent in the industry in which the company operates. The directors manage this risk by ensuring long standing relationships with trusts, suppliers and financiers are maintained. The directors actively promote the business in the local economy.

Covid-19 Risk:

The directors have a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing the Annual report. As a result of the government and health agency announcements and advice provided surrounding Covid-19, the directors have implemented detailed business continuity arrangements, adapting internal work practices, client service delivery, and comprehensive communications to all stakeholders so as to best deliver uncertainty of supply in a safe and consistent manner. The directors have considered the potential financial impact of these current measures on the financial performance of the business in the immediate future and in their view based on current performance, do not expect Covid-19 to have a significant impact on financial performance.

FUTURE DEVELOPMENTS

The directors are committed to long term creation of shareholder value by increasing its market share in the Northern Ireland market. The directors are confident that their strategy will result in continued growth and profitability.

GROUP POLICY ON EMPLOYING DISABLED WORKERS

The group's policy is to recruit disabled workers for those vacancies that they are able to fill. All necessary assistance with initial training courses is given. Once employed, a career plan is developed so as to ensure suitable opportunities for each disabled worker. Arrangements are made, whenever possible, for retraining employees who become disabled, to enable them to perform work identified as appropriate to their aptitudes and abilities.

EMPLOYEES

The group is dependent on the skills and commitment of its employees in order to achieve to achieve its objectives. Staff at every level are encouraged to make their fullest possible contribution to the group's success. The group's selection, training, development and promotion policies ensure equal opportunities for all employees, regardless of gender, marital status, race, age or disability. All decisions are based on merit.

ON BEHALF OF THE BOARD:

Brian Macklin - Director

22 April 2021

The directors present their report with the financial statements of the Company and the Group for the year ended 30 June 2020.

PRINCIPAL ACTIVITY

The principal activity of the company is acting as a holding company. The activities of the group include hotel & leisure and residential care services to elderly and disabled persons.

DIVIDENDS

No dividends will be distributed for the year ended 30 June 2020.

The directors did not recommend payment of an interim dividend (2019: £nil)

The directors do not recommend payment of a final dividend (2019: £4,000)

DIRECTORS

The directors shown below have held office during the whole of the period from 1 July 2019 to the date of this report.

Brian Macklin

Mary Macklin

CHARITABLE DONATIONS AND EXPENDITURE

During the year the group made charitable donations of £2,035 (2019: £3,068)

DISCLOSURES REQUIRED UNDER SCHEDULE 7

In accordance with Section 414C (11) of Companies Act 2006, the directors have elected to disclose details of the business review, principal risks and uncertainties, employment policy and future developments in the Group's Strategic Report which would otherwise be required to be disclosed in the Directors' Report.

DIRECTORS' RESPONSIBILITIES STATEMENT

The directors are responsible for preparing the Group 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 United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law), 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 the Group and of the profit or loss of the Group for that period. In preparing these financial statements, the directors are required to:

-	select suitable accounting policies and then apply them consistently;

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

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

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

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's and the Group's transactions and disclose with reasonable accuracy at any time the financial position of the Company and the Group and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Company and 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 directors are 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 each director has taken all the steps that he or she ought to have taken as a director in order to make himself or herself aware of any relevant audit information and to establish that the Group's auditors are aware of that information.

AUDITORS

The auditors, CavanaghKelly, (Chartered Accountants) have indicated their willingness to continue in office in accordance with the provisions of Section 485 of the Companies Act 2006.

ON BEHALF OF THE BOARD:

Brian Macklin - Director

22 April 2021

Opinion

We have audited the financial statements of BMGC Ltd (the 'Parent Company') and its subsidiaries (the 'Group') for the year ended 30 June 2020 which comprise the Consolidated Income Statement, Consolidated Statement of Financial Position, Company Statement of Financial Position, Consolidated Statement of Changes in Equity, Company Statement of Changes in Equity, Consolidated Statement of Cash Flows and Notes to the Consolidated Statement of Cash Flows, Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

-	give a true and fair view of the state of the Group's and of the Parent Company affairs as at 30 June 2020 and of the Group's loss for the year then ended;

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

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

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the Group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

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

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

-

the directors have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the 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.

Other information

The directors are responsible for the other information. The other information comprises the information in the Group Strategic Report and the Directors' Report, but does not include 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. 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 Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

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

Matters on which we are required to report by exception

In the light of 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 Directors' Report.

We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:

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

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

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

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

Responsibilities of directors

As explained more fully in the Directors' Responsibilities Statement set out on page four, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the Group's and the Parent Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Group or the Parent Company or to cease operations, or have no realistic alternative but to do so.

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 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.

Use of our report

This report is made solely to the Company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in an 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 as a body, for our audit work, for this report, or for the opinions we have formed.

Mrs. Catherine Martin FCA (Senior Statutory Auditor)

for and on behalf of CavanaghKelly

Chartered Accountants and Statutory Auditors

36-38 Northland Row

Dungannon

Co. Tyrone

BT71 6AP

22 April 2021

TURNOVER

4

16,852,744

17,197,164

Cost of sales

(11,435,738

)

(10,886,752

)

GROSS PROFIT

5,417,006

6,310,412

Administrative expenses

(6,257,717

)

(5,931,428

)

(840,711

)

378,984

Other operating income

468,884

43,788

OPERATING (LOSS)/PROFIT

6

(371,827

)

422,772

Finance income

546

-

(371,281

)

422,772

Finance costs

7

(410,771

)

(477,290

)

LOSS BEFORE TAXATION

(782,052

)

(54,518

)

Tax on loss

8

(22,514

)

(155,719

)

LOSS FOR THE FINANCIAL YEAR

(804,566

)

(210,237

)

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

(804,566

)

(210,237

)

Loss attributable to:

Owners of the parent

(804,566

)

(210,237

)

Total comprehensive income attributable to:

Owners of the parent

(804,566

)

(210,237

)

NON-CURRENT ASSETS

Intangible assets

11

4,478,480

4,919,522

Tangible assets

12

35,255,060

34,386,492

Investments

13

-

-

39,733,540

39,306,014

CURRENT ASSETS

Stocks

14

21,070

35,120

Receivables: amounts falling due within one year

15

2,250,341

2,637,950

Cash at bank and in hand

833,542

1,365,580

3,104,953

4,038,650

PAYABLES

Amounts falling due within one year

16

(3,740,712

)

(3,823,523

)

NET CURRENT (LIABILITIES)/ASSETS

(635,759

)

215,127

TOTAL ASSETS LESS CURRENT LIABILITIES

39,097,781

39,521,141

PAYABLES

Amounts falling due after more than one year

17

(13,947,790

)

(13,066,584

)

NET ASSETS

25,149,991

26,454,557

CAPITAL AND RESERVES

Called up share capital

20

2,400,000

2,900,000

Revaluation reserve

19,377,649

19,634,813

Capital redemption reserve

600,000

600,000

Retained earnings

2,772,342

3,319,744

SHAREHOLDERS' FUNDS

25,149,991

26,454,557

The financial statements were approved by the Board of Directors and authorised for issue on 22 April 2021 and were signed on its behalf by:

Brian Macklin - Director

NON-CURRENT ASSETS

Intangible assets

11

-

-

Tangible assets

12

-

-

Investments

13

4,173,755

4,173,755

4,173,755

4,173,755

CURRENT ASSETS

Receivables: amounts falling due within one year

15

75,073

214,461

Cash at bank

100

100

75,173

214,561

PAYABLES

Amounts falling due within one year

16

(1,115,571

)

(754,959

)

NET CURRENT LIABILITIES

(1,040,398

)

(540,398

)

TOTAL ASSETS LESS CURRENT LIABILITIES

3,133,357

3,633,357

CAPITAL AND RESERVES

Called up share capital

20

2,400,000

2,900,000

Capital redemption reserve

600,000

600,000

Retained earnings

133,357

133,357

SHAREHOLDERS' FUNDS

3,133,357

3,633,357

Company's profit for the financial year

-

-

The financial statements were approved by the Board of Directors and authorised for issue on 22 April 2021 and were signed on its behalf by:

Brian Macklin - Director

Called up

Capital

share

Retained

Revaluation

redemption

Total

capital

earnings

reserve

reserve

equity

£

£

£

£

£

Balance at 1 July 2018

2,900,000

2,761,763

20,407,031

600,000

26,668,794

Changes in equity

Dividends

-

(4,000

)

-

-

(4,000

)

Total comprehensive income

-

561,981

(772,218

)

-

(210,237

)

Balance at 30 June 2019

2,900,000

3,319,744

19,634,813

600,000

26,454,557

Changes in equity

Reduction in share capital

(500,000

)

-

-

-

(500,000

)

Total comprehensive income

-

(547,402

)

(257,164

)

-

(804,566

)

Balance at 30 June 2020

2,400,000

2,772,342

19,377,649

600,000

25,149,991

Called up

Capital

share

Retained

redemption

Total

capital

earnings

reserve

equity

£

£

£

£

Balance at 1 July 2018

2,900,000

137,357

600,000

3,637,357

Changes in equity

Dividends

-

(4,000

)

-

(4,000

)

Balance at 30 June 2019

2,900,000

133,357

600,000

3,633,357

Changes in equity

Reduction in share capital

(500,000

)

-

-

(500,000

)

Balance at 30 June 2020

2,400,000

133,357

600,000

3,133,357

Cash flows from operating activities

Cash generated from operations

1

1,491,736

1,086,527

Interest paid

(410,771

)

(477,290

)

Tax paid

-

(293,886

)

Net cash from operating activities

1,080,965

315,351

Cash flows from investing activities

Purchase of tangible fixed assets

(2,168,227

)

(1,602,998

)

Sale of tangible fixed assets

-

4,727

Interest received

546

-

Net cash from investing activities

(2,167,681

)

(1,598,271

)

Cash flows from financing activities

New loans in year

5,131,661

2,538,570

Loan repayments in year

(4,108,071

)

(1,228,106

)

Amount introduced by directors

31,088

-

Amount withdrawn by directors

-

(356

)

Redemption of preference shares

(500,000

)

-

Equity dividends paid

-

(4,000

)

Net cash from financing activities

554,678

1,306,108

(Decrease)/increase in cash and cash equivalents

(532,038

)

23,188

Cash and cash equivalents at beginning of year

2

1,365,580

1,342,392

Cash and cash equivalents at end of year

2

833,542

1,365,580

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

2020

2019

£

£

Loss before taxation

(782,052

)

(54,518

)

Depreciation charges

1,740,702

1,784,498

Loss on disposal of fixed assets

-

7,631

Finance costs

410,771

477,290

Finance income

(546

)

-

1,368,875

2,214,901

Decrease in stocks

14,050

21,856

Decrease/(increase) in trade and other debtors

334,006

(983,212

)

Decrease in trade and other creditors

(225,195

)

(167,018

)

Cash generated from operations

1,491,736

1,086,527

2.	CASH AND CASH EQUIVALENTS

The amounts disclosed on the Statement of Cash Flows in respect of cash and cash equivalents are in respect of these Statement of Financial Position amounts:

Year ended 30 June 2020

30/6/20

1/7/19

£

£

Cash and cash equivalents

833,542

1,365,580

Year ended 30 June 2019

30/6/19

1/7/18

£

£

Cash and cash equivalents

1,365,580

1,342,392

3.	ANALYSIS OF CHANGES IN NET DEBT

At 1/7/19

Cash flow

At 30/6/20

£

£

£

Net cash

Cash at bank and in hand

1,365,580

(532,038

)

833,542

1,365,580

(532,038

)

833,542

Debt

Debts falling due within 1 year

(1,571,014

)

(142,383

)

(1,713,397

)

Debts falling due after 1 year

(13,066,584

)

(881,206

)

(13,947,790

)

(14,637,598

)

(1,023,589

)

(15,661,187

)

Total

(13,272,018

)

(1,555,627

)

(14,827,645

)

1.	STATUTORY INFORMATION

BMGC Ltd is a private company, limited by shares, registered in Northern Ireland within the United Kingdom. The company's registered number and registered office can be found on the General Information page.

2.	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" and the Companies Act 2006. The financial statements of the group and company for the year ended 30 June 2020 have been prepared in accordance with the Financial Reporting Standard applicable in the United Kingdom and the Republic of Ireland (FRS 102) issued by the Financial Reporting Council and in accordance with the Companies Act 2006.

3.	ACCOUNTING POLICIES

Basis of preparation

The financial statements have been prepared in accordance with applicable accounting standards including Financial Reporting Standard 102 The Financial Reporting Standard Applicable in the UK and Republic of Ireland (FRS 102) and the Companies Act 2006. The financial statements have been prepared on a going concern basis under the historical cost convention, modified to include certain items at fair value. The following accounting policies have been applied consistently in dealing with items which are considered material in relation to the company's financial statements. The financial statements are presented in sterling which is the functional currency of the company and rounded to the nearest £   .

Financial Reporting Standard 102 - reduced disclosure exemptions

The Group has taken advantage of the following disclosure exemption in preparing these financial statements, as permitted by FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":

•

the requirement of paragraph 33.7.

Basis of consolidation

The consolidated financial statements include the financial statements of the parent company and all its subsidiary companies made up to 30 June 2020.

Significant judgements and estimates

The preparation of the financial statements in accordance with generally accepted accounting principles requires management to make estimates, judgements and assumptions that affect the reported amounts of assets and liabilities, income and expenditure in the reporting period. Actual results could differ from those estimates. However, management do not believe there are any significant estimates, judgements or assumptions applied within the accounting policies.

Revenue

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the group and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes.

Provision of services:

Revenue from a contract to provide services is recognised in the period in which the services are provided. The following criteria must also be met before revenue is recognised:

- the amount of revenue can be measured reliably;

- it is probable that future economic benefits will flow through the company

- the costs incurred or to be incurred in respect of the transaction can be measured reliably

Goodwill

Purchased goodwill arising on the acquisition of a business represents the excess of the acquisition cost over the fair value of the identifiable net assets including other intangible fixed assets when they were acquired. Purchased goodwill is capitalised in the Statement of Financial Position and amortised on a straight line basis over its economic useful life of 10 years, which is estimated to be the period during which benefits are expected to arise. On disposal of a business any goodwill not yet amortised is included in determining the profit or loss on sale of the business.

Goodwill is reviewed for impairment at the end of the first full financial year following acquisition and in other periods if events or changes in circumstances indicate that the carrying value may not be recoverable.

Property, plant and equipment and depreciation

Property, plant and equipment are stated at cost or at valuation, less accumulated depreciation. Historic cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management. The charge to depreciation is calculated to write off the original cost or valuation of property, plant and equipment, less their estimated residual value, over their expected useful lives as follows:

Buildings freehold

2% Straight line

Plant and machinery

25% Reducing balance

Fixtures, fittings and equipment

25% Straight line

Motor vehicles

25% Straight line

The carrying values of property, plant and equipment are reviewed annually for impairment in periods if events or changes in circumstances indicate the carrying value may not be recoverable.

Revaluation gains arising in a year are recognised in the statement of changes in equity except to the extent that they reserve revaluation losses that were previously charged to the income statement. Revaluation losses which represent a clear consumption of economic benefit inherent in the asset are recognised in the income statement.

An amount equal to the excess of the annual depreciation charge on revalued assets over the notional historical cost depreciation charge on those assets is transferred annually from the revaluation reserve to the retained earnings.