Unique Caribbean Holidays Limited - Limited company accounts 20.1

REGISTERED NUMBER: 04122639 (England and Wales)

Strategic Report, Report of the Directors and

Audited Financial Statements for the Period 1 August 2021 to 30 June 2022

for

Unique Caribbean Holidays Limited

Page

Company Information

1

Strategic Report

2

to

4

Report of the Directors

5

to

6

Report of the Independent Auditors

7

to

10

Statement of Profit or Loss and Other Comprehensive Income

11

Statement of Financial Position

12

Statement of Changes in Equity

13

Statement of Cash Flows

14

Notes to the Financial Statements

15

to

30

DIRECTORS:

K R Thompson

S R Foster

D Stefano

J A Clarke

REGISTERED OFFICE:

2nd Floor, Nucleus House

2 Lower Mortlake Road

Richmond

TW9 2JA

REGISTERED NUMBER:

04122639 (England and Wales)

SENIOR STATUTORY AUDITOR:

M S Caldicott ACA FCCA CTA

AUDITORS:

White Hart Associates (London) Limited

Chartered Accountants and Statutory Auditors

2nd Floor, Nucleus House

2 Lower Mortlake Road

Richmond

TW9 2JA

SOLICITORS:

Fox Williams LLP

10 Finsbury Square

London

EC2A 1AF

The directors present their strategic report for the period 1 August 2021 to 30 June 2022.

The company is required by the Companies Act to set out in this report, a fair review of the business of the company during the financial period ended 30 June 2022, and its position at the end of the period along with a description of the principal risks and uncertainties facing the company. This review is prepared solely to provide additional information to shareholders to assess the company's strategies and the potential for those strategies to succeed, and the business review should not be relied upon by any other party or for any other purpose.

REVIEW OF BUSINESS

The directors are satisfied with the company's performance during the period. The prioritisation of customer service through rebooking to future dates where travel was not possible during the pandemic and refunding cash where cancellation were necessary enabled the company to retain bookings and generate customer goodwill. This has resulted in strong booking profiles since travel restrictions were lifted in the second half of 2021 as consumer confidence improves.

The key performance indicators used by the directors to monitor the progress of the company are set out

below:-

2022

2021

£

£

Key performance indicators

Turnover

69,402,234

7,615,616

Gross profit

5,094,149

580,105

Gross profit as a percentage of turnover

7.34%

7.62%

Profit/(loss) on ordinary activities before taxation

676,250

(2,154,150

)

Profit/(loss) on ordinary activities as a percentage of turnover

0.97%

(28.29%

)

Monthly management accounts including full year forecasts are reviewed against budgets and prior years to monitor the business performance and to highlight required actions as appropriate.

PRINCIPAL RISKS AND UNCERTAINTIES

The following risk factors may affect the company's operating results and its financial position. The risk factors described below are those which the directors believe are potentially significant but should not be regarded as a complete and comprehensive statement of all potential risk and uncertainties facing the company. The directors do not feel that the risks in 2023 will be much different to those that were prevalent in 2022, with the obvious exception being the cost of living crisis. At the date of this report, it is impossible to assess the full impact of this, but the company is monitoring the situation and will take all necessary actions to try and protect the company's immediate trading performance and long-term position.

Regulatory risk

The company is exposed to various regulators, including the Civil Aviation Authority ("CAA"), which issues an Air Travel Organisers Licence ("ATOL") and is required in order for the company to operate. This licence is renewed in March each year and is subject to assessments of fitness and financial criteria, the framework of which is available on the CAA's website (www.caa.co.uk). The company is also a member of the Association of British Travel Agents ("ABTA") and as such is obliged to maintain a high standard of service as governed by ABTA's code of conduct.

Credit risk

Due to the nature of the company's business whereby individual customers are required to pay for their holiday in full before they are allowed to travel, credit risk is considered to be low. In the case of sales through travel agents and wholesalers whereby payment may be received after the travel date, ongoing business relationships mean that chasing debts is significantly easier and controls have been put in place to ensure that debts are chased when they are due.

Liquidity risk

The objective of the company in managing liquidity risk is to ensure that it can meet its financial obligations as and when they fall due. The company expects to meet its financial obligations through operating cash flows. However, if due to unusual circumstances this was insufficient, the company could draw on support from within the wider group.

Foreign exchange rate exposure

The functional currency of the company is sterling, however the company undertakes transactions with suppliers principally in US Dollars. Consequently the company is at risk to the extent that the Pound Sterling may weaken against the United States Dollar to which the company needs to settle its land-based costs post-travel. This risk is mitigated by other group members having prudent forward exchange contracts in place to hedge against exchange rate fluctuations.

Technology risk

The company is heavily reliant on the uninterrupted operation of its IT systems and website. These systems are vulnerable to power loss, fire, computer viruses and other events. Loss of these systems would impair the ability of the company to carry on its business effectively. The company has made arrangements to mitigate this risk.

Interest rate risk

Interest rate risk is considered to be less of an issue for the company as it is not reliant upon receiving interest in order to continue trading and also because it does not have any loans susceptible to changes in interest rates. The company finances its operations through retained profits.

Economic conditions

The demand for holidays is affected by local economic conditions. The uncertainty and the inability to travel, created by the COVID-19 pandemic continues to affect the company. During 2022 the war in Ukraine and subsequent cost of living crisis has seen demand affected and the level of cancellations higher than the historic norm. Schedule changes by airlines have also affected the company's ability to deliver holidays as booked though the retention rate of those bookings is above industry standards.

CORONAVIRUS IMPACT AND FUTURE DEVELOPMENTS

During the period the company was exposed to restrictions placed on UK residents arriving into the Caribbean islands by local governments but by the end of the period the directors were pleased to note that all restrictions had been removed. The company endeavoured to fulfil as many holidays as possible and in circumstances where it was not possible have offered alternative resorts or a full refund. All refunds have been paid in cash with no credit notes issued.

The directors continue to be encouraged by the number of bookings that are retained when they have been affected by a change either on island or by an airline and believe that the policies adopted during the pandemic built customer goodwill that will continue to benefit the company as pent up demand is satisfied.

The levels of business on the books for 2023 departures and beyond together with the announcements regarding new destinations and resorts for the Sandals brand lead the directors to believe that the company will continue to grow.

ON BEHALF OF THE BOARD:

K R Thompson - Director

13 December 2022

The directors present their report with the financial statements of the company for the period 1 August 2021 to 30 June 2022.

PRINCIPAL ACTIVITY

The principal activity of the company in the period under review was the provision of Sandals and Beaches holidays to UK based consumers as either land-only or flight inclusive packages.

DIVIDENDS

No dividends will be distributed for the period ended 30 June 2022.

FUTURE DEVELOPMENTS

There have been no significant events affecting the company since the period end, except for the impact of the current cost of living crisis, which has had a noticeable impact on consumer demand and foreign currency exchange rates.

During 2023, the company will continue to operate as outlined in the principal activity note above.

DIRECTORS

The directors shown below have held office during the whole of the period from 1 August 2021 to the date of this report.

K R Thompson

S R Foster

D Stefano

J A Clarke

GOING CONCERN

The directors have considered the company's current and future prospects, taking into account the effects of the coronavirus pandemic on cash flows and liquidity. As set out in the notes to the financial statements, the results of our base case and downside scenario forecasting indicate that there is sufficient support available within the wider group to enable the company to continue to pay its liabilities as they fall due for a period of at least 12 months from the date of approval of these financial statements. As such, the directors continue to adopt the going concern basis of preparation for these financial statements. However, despite the relaxation of international travel restrictions, there is still the potential for further disruption to travel should the pandemic see a resurgence and this could have a potential impact on consumer confidence to buy our holidays and to travel. As a result, this gives rise to some uncertainties over going concern as detailed in the notes to the financial statements.

QUALIFYING INDEMNITY PROVISION

During the period and up to the date of this report, the company maintained liability insurance and third-party indemnification provisions for its directors, under which the company has agreed to indemnify the directors to the extent permitted by law in respect of all liabilities to third parties arising out of, or in connection with, the execution of their powers, duties and responsibilities as directors of the company.

DISCLOSURE IN THE STRATEGIC REPORT

The directors have provided commentary for the Review of Business and Analysis of Performance as well as the Principal Risks and Uncertainties in the Strategic Report in line with The Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008.

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The directors are responsible for preparing the Strategic Report, the Report of the Directors and the financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with UK-adopted international accounting standards. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:

-	select suitable accounting policies and then apply them consistently;

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

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

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

The directors are responsible for the maintenance and integrity of the corporate and financial information included on the company's website.

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS

So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and each director has taken all the steps that he 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 company's auditors are aware of that information.

AUDITORS

The auditors, White Hart Associates (London) Limited, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

K R Thompson - Director

13 December 2022

Opinion

We have audited the financial statements of Unique Caribbean Holidays Limited (the 'company') for the period ended 30 June 2022 which comprise the Statement of Profit or Loss and Other Comprehensive Income, the Statement of Financial Position, the Statement of Changes in Equity, the Statement of Cash Flows and 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 International Financial Reporting Standards (IFRSs) as adopted by the UK.

In our opinion the financial statements:

-	give a true and fair view of the state of the company's affairs as at 30 June 2022 and of its profit for the period then ended;

-	have been properly prepared in accordance with IFRSs as adopted by the UK; and

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

Basis for opinion

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

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Other information

The directors are responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon.

Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

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

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

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

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Report of the Directors.

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

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

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

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

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

Responsibilities of directors

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

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

Auditors' responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue a Report of the Auditors that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

- We exercise professional judgment and maintain professional scepticism throughout the audit;

- We identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the deliberate override of internal control;

- We obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of internal control;

- We evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made;

- We assess the risk of management override of controls, including testing journal entries and other adjustments for appropriateness, and evaluating the business rationale of significant transactions outside the normal course of business;

- We review the scope of the Company's compliance with The Package and Linked Travel Arrangements Regulations 2018 ("PTRs") and sample test relevant documentation to assess this and the effectiveness of its control environment;

- We request and review the minutes of management meetings, and assess any matters identified not already provided for or disclosed that may materially impact the financial statements;

- We review the company's relationships with related parties and other group companies, identifying and disclosing transactions during the year and balances at year-end with such parties;

- We conclude on the appropriateness of the directors' use of the going concern basis of accounting and, based on the evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the entity's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the entity to cease to continue as a going concern.

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.

The impact of uncertainties due to the COVID-19 pandemic on our audit

Uncertainties related to the effects of the COVID-19 pandemic are relevant to understanding our audit of the financial statements. All audits assess and challenge the reasonableness of estimates made by the directors, such as recoverability of investments, intangible assets and related disclosures and the appropriateness of the going concern basis of preparation of the financial statements. All of these depend on assessments of the future economic environment and the Company's future prospects and performance.

The COVID-19 pandemic had an unprecedented impact upon the worldwide economy and in particular upon the travel industry, with many consumers cancelling or delaying travel plans as a result. At the date of this report, the full range of possible effects upon travel companies cannot be estimated or assessed due to the current levels of uncertainty around the economy and consumer resilience. There is also a post pandemic issue with airline and supplier resource to cope with the resurging demand for travel, which is well publicised. There is also the further uncertainty of the impact of a potential surge in infection rates in the coming winter months.

We applied a standardised firm-wide approach in response to these uncertainties when assessing the Company's future prospects and performance. However, no audit should be expected to predict the unknowable factors or all possible future implications for a group or company and this is particularly the case in relation to the COVID-19 pandemic.

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.

M S Caldicott ACA FCCA CTA (Senior Statutory Auditor)

for and on behalf of White Hart Associates (London) Limited

Chartered Accountants and Statutory Auditors

2nd Floor, Nucleus House

2 Lower Mortlake Road

Richmond

TW9 2JA

13 December 2022

CONTINUING OPERATIONS

Revenue

3

69,402,234

7,615,616

Cost of sales

(64,308,085

)

(7,035,511

)

GROSS PROFIT

5,094,149

580,105

Other operating income

4

-

17,836

Administrative expenses

(4,401,860

)

(2,728,039

)

OPERATING PROFIT/(LOSS)

692,289

(2,130,098

)

Finance costs

6

(24,031

)

(30,553

)

Finance income

6

7,992

6,501

PROFIT/(LOSS) BEFORE INCOME TAX

7

676,250

(2,154,150

)

Income tax

8

14,885

19,715

PROFIT/(LOSS) FOR THE PERIOD

691,135

(2,134,435

)

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME/(LOSS) FOR THE PERIOD

691,135

(2,134,435

)

ASSETS

NON-CURRENT ASSETS

Owned

Intangible assets

9

21,563

36,989

Property, plant and equipment

10

570,775

699,997

Right-of-use

Property, plant and equipment

10, 17

813,818

1,043,356

Deferred tax

18

130,577

115,692

1,536,733

1,896,034

CURRENT ASSETS

Trade and other receivables

11

5,707,878

3,689,557

Cash and cash equivalents

12

18,099,418

16,714,846

23,807,296

20,404,403

TOTAL ASSETS

25,344,029

22,300,437

EQUITY

SHAREHOLDERS' EQUITY

Called up share capital

13

500,000

500,000

Retained earnings

14

(2,828,390

)

(3,519,525

)

TOTAL EQUITY

(2,328,390

)

(3,019,525

)

LIABILITIES

NON-CURRENT LIABILITIES

Trade and other payables

15

1,168,537

1,687,673

Financial liabilities - leasing

Leasing liabilities

16

703,031

925,371

1,871,568

2,613,044

CURRENT LIABILITIES

Trade and other payables

15

25,500,358

22,452,796

Financial liabilities - leasing

Leasing liabilities

16

300,493

254,122

25,800,851

22,706,918

TOTAL LIABILITIES

27,672,419

25,319,962

TOTAL EQUITY AND LIABILITIES

25,344,029

22,300,437

The financial statements were approved by the Board of Directors and authorised for issue on 13 December 2022 and were signed on its behalf by:

K R Thompson - Director

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 August 2020

500,000

(1,289,911

)

(789,911

)

Changes in equity

Total comprehensive loss

-

(2,134,435

)

(2,134,435

)

Impact of implementing IFRS 16 under the modified retrospective method

-

(95,179

)

(95,179

)

Balance at 31 July 2021

500,000

(3,519,525

)

(3,019,525

)

Changes in equity

Total comprehensive income

-

691,135

691,135

Balance at 30 June 2022

500,000

(2,828,390

)

(2,328,390

)

Cash flows from operating activities

Cash generated from operations

23

1,603,345

9,025,972

Lease interest paid

(24,031

)

(30,553

)

Tax repaid

-

415,075

Net cash from operating activities

1,579,314

9,410,494

Cash flows from investing activities

Purchase of intangible fixed assets

(12,748

)

-

Purchase of tangible fixed assets

(14,017

)

(3,383

)

Interest received

7,992

6,501

Net cash from investing activities

(18,773

)

3,118

Cash flows from financing activities

Payment of lease liabilities

(175,969

)

-

Receipts of group loans

-

316,004

Net cash from financing activities

(175,969

)

316,004

Increase in cash and cash equivalents

1,384,572

9,729,616

Cash and cash equivalents at beginning of period

24

16,714,846

6,985,230

Cash and cash equivalents at end of period

24

18,099,418

16,714,846

1.	STATUTORY INFORMATION

Unique Caribbean Holidays Limited is a limited company incorporated in the United Kingdom. The principal activity of the company is that of a Tour Operator. The company's ATOL Number is 11174, ABTA Number is Y6413 and IATA Numeric Code is 07886493.

The company's registered office is:

2nd Floor, Nucleus House

2 Lower Mortlake Road

Richmond

TW9 2JA

2.	ACCOUNTING POLICIES

Basis of preparation

These financial statements have been prepared in accordance with UK-adopted international accounting standards and with those parts of the Companies Act 2006 applicable to companies reporting under IFRS. The financial statements have been prepared under the historical cost convention.

Going concern

In assessing the company's going concern position for the period ended 30 June 2022, the directors have considered the company's cash flows, liquidity and business activities. The company is a trading subsidiary of the group headed up by the ultimate parent company and has net current assets as at 30 June 2022. As a result of its business model, the company is reliant on the continued financial support of the group and it has received written confirmation from Unique Vacations Inc, the ultimate controlling party, of its intention to support the company for a period of at least 12 months after these financial statements are signed.

In making this assessment, the directors have considered the potential impact of the current economic climate on the cash flows and liquidity of the company over the period to 31 January 2024.

The assessment reflects the current measures put in place by the company to preserve cash whilst the cost of living crisis puts pressure on consumers and the value of Sterling.

The directors acknowledge there are material uncertainties that may cast significant doubt over the company's ability to continue as a going concern in respect of:

- the extent and potential reapplication of travel restrictions in the UK and overseas;

- potential reductions in revenues that may arise from a reduction in consumer demand for the holidays that the company sells once the cost of living crisis impacts consumers.

Having assessed the potential liquidity shortfall in the event of a longer period of impact from the COVID-19 pandemic and the mitigating actions the company can control and those which they could expect to be able to take, the directors' have a reasonable expectation that the company has adequate resources to continue in operational existence for the next 12 months. For these reasons and the written confirmation of financial support received from Unique Vacations Inc, they continue to adopt a going concern basis for the preparation of the financial statements. Accordingly these financial statements do not include any adjustments to the carrying amount or classification of assets and liabilities that would result if the company were unable to continue as a going concern.

Critical accounting judgements and key sources of estimation uncertainty

Preparation of the financial statements requires management to make certain judgements and estimates. The key items in the financial statements where these judgements and estimates have been made include:

Critical management judgement in applying accounting policies

There are no management judgements that are considered to be critical in applying accounting policies.

Key sources of estimation uncertainty

Fixed assets

Depreciation and amortisation of tangible and intangible assets requires consideration of the useful economic life and residual value of fixed assets. Management estimate the future benefit of fixed assets and perform an annual review for signs of any impairment in these assets.

New accounting standards and interpretations

The Company has not adopted any new accounting standards during the year.

Accounting standards and interpretations issued but not effective

Relevant standards and interpretations that are issued up to the date of issuance of the financial statements, but not yet adopted are disclosed below. The company's intention is to adopt the relevant new and amended standards and interpretations when they become effective, subject to EU approval before the financial statements are issued.

IFRS 17 'Insurance Contracts' ("IFRS 17") was issued in May 2017 and introduces a single accounting model for the recognition of profits from insurance contracts for companies providing insurance services. IFRS 17 has been deferred and will now be effective for periods beginning on or after 1 January 2023, however because the company does not act as an insurer, it does not expect the standard to have a significant impact on its financial statements.

Revenue recognition

Revenue represents the amounts receivable by the company for sales of holiday products and related commissions. Revenue is measured based on the consideration specified in the company's contracts with customers, excluding discounts, rebates and other sales taxes. Revenue is recognised as the performance obligations are satisfied.

Nature of goods and services

Holiday revenue, net of discounts, includes revenue earned primarily from accommodation packages and any other supporting activities, including air and other transportation and customer cancellations. The company's performance obligations under these contracts are to provide a package vacation and other supporting activities in exchange for the invoiced transaction price. The company engages third parties to fulfill obligations to customers for air and other transportation, but retains the ultimate risks of fulfilment and generally has discretion to select the acceptable carrier and absorbs the risk of cost fluctuations. The company satisfies the performance obligations and recognises revenue pro-rata over the vacation period, except for cancellation revenues, which are recognised upon cancellation.

Payment Terms and Deferred Revenue

Payment terms and cancellation policies are broadly standard. A deposit for a future vacation is required at or soon after the time of booking to secure the booking. The company collects a majority of its deposits for bookings and tours up to, and in some cases more than, a year in advance of the departure date with the remaining balances due prior to departure. Deposits include the total amounts paid by customers prior to departure, for which the company is obligated to perform services. These deposits represent contract liabilities, which are recorded as deferred revenue and are recognised as revenue generally pro rata over the vacation period. Deferred revenue is a current liability as it relates to the company's normal operating cycle.

Costs of sales

Expenses from the company's holiday operations are recognised at the time the company provides the services. The company is usually required to make deposit payments to suppliers for the cost of accommodation, flights and other related costs at or soon after the time of booking to secure these, with the remaining balances due prior to departure. These deposit payments represent contract assets, which are recorded as prepayments and are recognised as cost of sales generally pro-rata over the vacation period. Prepayments are a current asset as they relate to the company's normal operating cycle.

Administrative expenses

Administration costs include marketing costs, employee costs, office expenses, professional services and other administrative costs. Marketing costs include media advertising, brochure production, direct mail costs, promotional expenses, search engine marketing and other costs that support the ongoing development of the company's brand and customer database. Marketing costs are expensed as incurred. Television advertising and exhibition costs are deferred until they take place. Office expenses include rent expense, utility costs, office supplies and telecommunication costs. Professional service fees include costs for accounting services, legal services and information technology consulting services. Other administrative costs include corporate insurance, postage and other sundry expenses. Employee costs, office expenses, professional service fees and other administrative expenses are expensed as incurred. Rent is recognised as expense on a straight-line basis over the lease term. Total administrative expenses for the years ended 30 June 2022 and 31 July 2021 were £4.4 million, and £2.7 million, respectively.

Interest income

Interest income is recognised as interest accrues using the effective interest rate method.

Cash and cash equivalents

Cash represents cash in hand and deposits held on demand with financial institutions. Cash equivalents are short-term, highly-liquid investments with original maturities of three months or less (as at their date of acquisition). Cash equivalents are readily convertible to known amounts of cash and subject to an insignificant risk of change in that cash value.

In the presentation of the Statement of Cash Flows, cash and cash equivalents also include bank overdrafts. Any such overdrafts are shown within borrowings under ‘current liabilities’ on the Statement of Financial Position.

Intangible assets

Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses. All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.

Amortisation

Amortisation is calculated so as to write off the cost of an asset, less its estimated residual value, over the useful life of that asset as follows:

Computer software

- 25% straight line

If there is an indication that there has been a significant change in amortisation rate, useful life or residual value of an intangible asset, the amortisation is revised prospectively to reflect the new estimates.

Property, plant and equipment

Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating the manner intended by management.

The company adds to the carrying amount of an item of tangible fixed assets the cost of replacing part of such an item when that cost is incurred, if the replacement part is expected to provide incremental future benefits to the company. The carrying amount of the replaced part is derecognised. Repairs and maintenance are charged to the Statement of comprehensive income during the period in which they are incurred.

Depreciation

Depreciation is calculated so as to write off the cost or valuation of an asset, less its residual value, over the useful economic life of that asset as follows:

Short leasehold property

- shorter of remaining lease period and 10 years

Right of use assets

- over the lease term

Computer equipment

- 25% straight line

Fixtures & Fittings

- 25% straight line

Depreciation on other assets is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, on a straight-line basis.

The assets residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.

Impairment of fixed assets

A review for indicators of impairment is carried out at each reporting date, with the recoverable amount being estimated where such indicators exist. Where the carrying value exceeds the recoverable amount, the asset is impaired accordingly. Prior impairments are also reviewed for possible reversal at each reporting date.

Financial instruments

Financial assets and liabilities are recognised on the statement of financial position when the company becomes a party to the contractual provisions of the instrument.

Financial assets include cash and cash equivalents, trade receivables, other receivables, loans and derivative financial instruments. Those relevant to the company are trade and other receivables, which are recorded at their nominal amount less an allowance for any doubtful debts, and cash and cash equivalents which are also recorded at their nominal amount. These financial assets are classified as loans and receivables and so are carried at amortised cost. Gains and losses are recognised in the statement of profit or loss when the assets are derecognised or impaired, as well as through the amortisation process.

Financial liabilities include trade and other payables, accruals, finance debt and derivative instruments. Those relevant to the company are trade and other payables and accruals which are stated at their nominal value. These financial liabilities are initially recognised at fair value and are then subsequently measured at amortised cost. Gains and losses arising on the repurchase, settlement or cancellation of liabilities are recognised in the statement of profit or loss.

Equity instruments issued by the company are recorded at the proceeds received net of direct issue costs.

Taxation

The taxation expense represents the aggregate amount of current and deferred tax recognised in the reporting period. Tax is recognised in profit or loss, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, tax is recognised in other comprehensive income or directly in equity, respectively.

Current tax is recognised on taxable profit for the current and past periods. Current tax is measured at the amounts of tax expected to pay or recover using the tax rates and laws that have been enacted or substantively enacted at the reporting date.

Deferred tax is recognised in respect of all timing differences at the reporting date. Unrelieved tax losses and other deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date that are expected to apply to the reversal of the timing difference.

Foreign currencies

Functional and presentation currency

The company's functional and presentational currency is GBP.

Transactions and balances

Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.

At each period end foreign currency monetary items are translated using the rate of exchanges at the statement of financial position date. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.

Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the Statement of Profit and Loss and Other Comprehensive Income except when deferred in other comprehensive income.

Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the Statement of Profit and Loss and Other Comprehensive Income within 'finance income or costs'. All other foreign exchange gains and losses are presented in the Statement of Comprehensive Income within 'other operating income'.

Leases

Leases are recognised as finance leases. The lease liability is initially recognised at the present value of the lease payments which have not yet been made and subsequently measured under the amortised cost method. The initial cost of the right-of-use asset comprises the amount of the initial measurement of the lease liability, lease payments made prior to the lease commencement date, initial direct costs and the estimated costs of removing or dismantling the underlying asset per the conditions of the contract.

Where ownership of the right-of-use asset transfers to the lessee at the end of the lease term, the right-of-use asset is depreciated over the asset’s remaining useful life. If ownership of the right-of-use asset does not transfer to the lessee at the end of the lease term, depreciation is charged over the shorter of the useful life of the right-of-use asset and the lease term.

Defined contribution pension plan

The company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the company pays fixed contributions into a separate entity. Once the contributions have been paid the company has no further payment obligations.

The contributions are recognised as an expense in the Statement of Profit and Loss and Other Comprehensive Income when they fall due. Amounts not paid are shown in accruals as a liability in the Statement of Financial Position. The assets of the plan are held separately from the company in independently administered funds.

Use of estimates

The preparation of financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimates are revised. The effect of the use of estimates in these financial statements is not material.

Receivables

Short term debtors are measured at transaction price, less any impairment. Impairment is assessed at the end of each reporting period for objective evidence of impairment. If evidence of impairment is found an impairment loss is recognised in the statement of comprehensive income.

Payables

Short term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.

Finance costs

Finance costs are charged to the Statement of Profit and Loss and Other Comprehensive Income over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.

Interest income

Interest income is recognised in the Statement of Profit and Loss and Other Comprehensive Income using the effective interest method.

Government grants

Grants are accounted for under the accruals model as permitted by IAS 20. Grants relating to expenditure on tangible fixed assets are credited to the Income Statement at the same rate as the depreciation on the assets to which the grant relates. The deferred element of grants is included in creditors as deferred income.

Grants of a revenue nature are recognised in the Income Statement in the same period as the related expenditure.

3.

REVENUE

Revenue from contracts with customers

The company sells holidays predominantly to the UK market, the destinations of which are all in the Caribbean.

Deferred revenue (contract liability)

Activity in the company's deferred revenue for the periods ended 30 June 2022 and 31 July 2021 is as follows:

£

Payments on account at 1 August 2020

9,757,644

Increase due to cash received

18,723,370

Revenue recognised

(7,615,616

)

Payments on account at 31 July 2021

20,865,398

Increase due to cash received

67,932,994

Revenue recognised

(69,402,234

)

Payments on account at 30 June 2022

19,396,158

The company recognised just over £69 million and just under £8 million from contract liabilities in revenue during the periods ended 30 June 2022 and 31 July 2021, respectively, which were derived from the majority of the company's deferred revenue balances at the beginning of each period and the cash received during the periods ended 30 June 2022 and 31 July 2021. Of the £19.4 million deferred revenue balance as at 30 June 2022, the company expects 94% to be recognised in revenue over the next 12 months.

Assets recognised from the costs to obtain a contract with a customer

Prepaid costs are incremental costs of obtaining contracts with customers that the company recognises as assets, which are included within prepaid expenses in the statement of financial position. Prepaid costs are generally paid in advance of departure date.

Prepaid costs increased to £2,570,012 as of 30 June 2022 from £1,650,501 as of 31 July 2021. The majority of the company's prepaid costs as of 1 August 2021 were expensed and reported within costs of sales in the Statement of Profit and Loss and Other Comprehensive Income for the period ended 30 June 2022.

4.	OTHER OPERATING INCOME

Period

1/8/21

to

Year Ended

30/6/22

31/7/21

£

£

Government grants

-

17,836

Government grants above relate to grants received through the Coronavirus Job Retention Scheme (CJRS), which was implemented by the UK Government to assist companies affected by the COVID-19 pandemic with employee wages. There are no unfulfilled conditions or other contingencies attaching to the grants recognised as income.

5.	EMPLOYEES AND DIRECTORS

Period

1/8/21

to

Year Ended

30/6/22

31/7/21

£

£

Wages and salaries

1,521,494

1,266,205

Social security costs

174,515

128,541

Other pension costs

64,157

62,861

1,760,166

1,457,607

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

Period

1/8/21

to

Year Ended

30/6/22

31/7/21

Sales

25

22

Marketing

2

4

Administration

12

14

Directors

4

4

43

44

In the opinion of the directors there are no members of key management personnel other than the directors themselves. All directors are remunerated by another group company therefore there were no transactions with key management personnel during the period (2021: £Nil)

6.	NET FINANCE COSTS

Period

1/8/21

to

Year Ended

30/6/22

31/7/21

£

£

Finance income:

Deposit account interest

7,992

6,501

Finance costs:

Lease interest payable

24,031

30,553

Net finance costs

16,039

24,052