Sandburn York Limited - Limited company accounts 23.1

REGISTERED NUMBER: 01691631 (England and Wales)

SANDBURN YORK LIMITED

STRATEGIC REPORT, REPORT OF THE DIRECTORS AND

FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 JANUARY 2023

Page

Company Information

1

Strategic Report

2

Report of the Directors

3

to

4

Report of the Independent Auditors

5

to

8

Statement of Comprehensive Income

9

Balance Sheet

10

Statement of Changes in Equity

11

Cash Flow Statement

12

Notes to the Cash Flow Statement

13

Notes to the Financial Statements

14

to

23

DIRECTORS:

Mr J Hogg

Mrs H A Abdelsattar

Mr S Buckley

Mr D P Holmes

SECRETARY:

Mr J Hogg

REGISTERED OFFICE:

Sandburn Hall

Flaxton

York

North Yorkshire

YO60 7RB

REGISTERED NUMBER:

01691631 (England and Wales)

AUDITORS:

UHY Calvert Smith LLP

Statutory Auditor

Chartered Accountants

Heritage House

Murton Way

Osbaldwick

York

North Yorkshire

YO19 5UW

BANKERS:

Lloyds TSB Bank plc

2 Pavement

York

YO1 2XA

The directors present their strategic report for the year ended 31 January 2023.

REVIEW OF BUSINESS

Sandburn York Limited continued to provide a range of holiday, leisure and hospitality facilities from the Sandburn Hall Estate through the year under review. The principal activities of the company are the Griffon Forest holiday lodges, leisure and hospitality facilities at Sandburn Hall (including the golf course, Tykes restaurant, and wedding / event hosting), and the Sandburn Hall Hotel.

The directors are satisfied with the company's results for the year, and with the continued growth in the business during a challenging economic period and with government Covid-19 support for the leisure and hospitality sector having been largely withdrawn.

Total turnover increased by 27% during the year ended 31 January 2023, to £7.0 million. The business has seen good demand across its established range of holiday and leisure facilities, with further growth driven by the first full year of trading for the hotel. Event activity has been particularly strong, having been significantly negatively impacted in previous years by Covid-19 restrictions and uncertainty.

Gross margins have fallen to 28% from 36% in the prior year, with operating profit also lower at £1.1m from £1.5m. This however primarily reflects significant investment in the renewal and maintenance of facilities in the year, and increased depreciation charges is respect of the completed hotel. £1.7 m of cash was generated from operating activities in the year.

The company's financial position at the year end remains strong, with a current ratio of 1.68, and total net assets of £10.3m from £9.5m in the prior year.

PRINCIPAL RISK AND UNCERTAINTIES

The trading environment for the company for the forthcoming year will be challenging, with continued inflation and supply issues driving cost increases across the business, and cost of living pressures impacting on our customers. As a sizeable local employer, with monthly staff numbers increasing to around 130 by the end of the year, the recruitment and retention of staff also represents a continued challenge, which is again further exacerbated by inflationary pressures.

The market sector is also high competitive and requires a continued focus on quality services and value.

FINANCIAL INSTRUMENTS

The company's financial risk management objectives are to ensure sufficient working capital is retained in the business, to allow continued reinvestment to maintain and enhance the company's facilities and to provide a reasonable return for the business. The company is supported in this by a loan from its parent company to fund major capital expenditure.

Cash flow is carefully managed by the company, with cash placed on short term deposit where appropriate.

ON BEHALF OF THE BOARD:

Mr J Hogg - Director

8 May 2023

The directors present their report with the financial statements of the company for the year ended 31 January 2023.

DIVIDENDS

No dividends will be distributed for the year ended 31 January 2023.

DIRECTORS

The directors shown below have held office during the whole of the period from 1 February 2022 to the date of this report.

Mr J Hogg

Mrs H A Abdelsattar

Mr S Buckley

Other changes in directors holding office are as follows:

Mr D P Holmes was appointed as a director after 31 January 2023 but prior to the date of this report.

DISCLOSURE IN THE STRATEGIC REPORT

The business review, future developments and discussion of financial risk management has been included in the Strategic Report.

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 United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). 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.

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, UHY Calvert Smith LLP, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

Mr J Hogg - Director

8 May 2023

Opinion

We have audited the financial statements of Sandburn York Limited (the 'company') for the year ended 31 January 2023 which comprise the Statement of Comprehensive Income, Balance Sheet, Statement of Changes in Equity, Cash Flow Statement and Notes to the 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 the financial statements:

-	give a true and fair view of the state of the company's affairs as at 31 January 2023 and of its profit 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 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 set out on page three, 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.

The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

- the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;

- we identified the laws and regulations applicable to the company through discussions with directors and from our commercial knowledge and experience of the sector; and

- we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the company, including the Companies Act 2006, taxation, employment, and health and safety legislation.

We assessed the susceptibility of the company's financial statements to material misstatement, including obtaining an understanding of how fraud might occur by:

- making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; and

- considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations.

To address the risk of fraud through management bias and override of controls, we:

- performed analytical procedures to identify any unusual or unexpected relationships;

- tested journal entries to identify unusual transactions;

- assessed whether judgements and assumptions made in determining the accounting estimates set out in note 2 were indicative of potential bias; and

- investigated the rationale behind significant or unusual transactions.

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:

- agreeing financial statement disclosures to underlying supporting documentation; and

- enquiring of management as to actual and potential litigation and claims.

There are inherent limitations in the audit procedures described above; any instance of non-compliance with laws and regulations and fraud which is far removed from transactions reflected in the financial statements would diminish the likelihood of detection. Furthermore, the risk of not detecting a material misstatement due to fraud is greater than the risk of not detecting one resulting from error. Fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentation, or through an act of collusion that would mitigate internal controls.

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.

Hayden Priest BEng BFP FCA (Senior Statutory Auditor)

for and on behalf of UHY Calvert Smith LLP

Statutory Auditor

Chartered Accountants

Heritage House

Murton Way

Osbaldwick

York

North Yorkshire

YO19 5UW

11 May 2023

TURNOVER

3

7,020,135

5,512,628

Cost of sales

5,046,116

3,506,835

GROSS PROFIT

1,974,019

2,005,793

Administrative expenses

1,003,018

892,482

971,001

1,113,311

Other operating income

134,498

351,504

OPERATING PROFIT

6

1,105,499

1,464,815

Interest receivable and similar income

7

7,710

468

PROFIT BEFORE TAXATION

1,113,209

1,465,283

Tax on profit

8

230,463

461,650

PROFIT FOR THE FINANCIAL YEAR

882,746

1,003,633

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

882,746

1,003,633

FIXED ASSETS

Tangible assets

9

14,085,337

14,204,092

Investment property

10

1,098,876

1,098,876

15,184,213

15,302,968

CURRENT ASSETS

Stocks

11

44,824

38,997

Debtors

12

178,666

197,794

Cash at bank and in hand

3,419,154

2,742,966

3,642,644

2,979,757

CREDITORS

Amounts falling due within one year

13

2,174,393

2,048,059

NET CURRENT ASSETS

1,468,251

931,698

TOTAL ASSETS LESS CURRENT LIABILITIES

16,652,464

16,234,666

CREDITORS

Amounts falling due after more than one year

14

(5,423,000

)

(5,911,000

)

PROVISIONS FOR LIABILITIES

16

(884,446

)

(861,394

)

NET ASSETS

10,345,018

9,462,272

CAPITAL AND RESERVES

Called up share capital

17

100

100

Retained earnings - non distributable

18

49,249

49,249

Retained earnings

18

10,295,669

9,412,923

SHAREHOLDERS' FUNDS

10,345,018

9,462,272

The financial statements were approved by the Board of Directors and authorised for issue on 8 May 2023 and were signed on its behalf by:

Mr J Hogg - Director

Retained

Called up

earnings

share

Retained

- non

Total

capital

earnings

distributable

equity

£

£

£

£

Balance at 1 February 2021

100

8,409,290

49,249

8,458,639

Changes in equity

Total comprehensive income

-

1,003,633

-

1,003,633

Balance at 31 January 2022

100

9,412,923

49,249

9,462,272

Changes in equity

Total comprehensive income

-

882,746

-

882,746

Balance at 31 January 2023

100

10,295,669

49,249

10,345,018

Cash flows from operating activities

Cash generated from operations

1

1,653,213

2,074,877

Tax paid

(49,402

)

-

Tax repayment received

-

149,171

Government grants received

-

203,106

Net cash from operating activities

1,603,811

2,427,154

Cash flows from investing activities

Purchase of tangible fixed assets

(440,373

)

(2,261,645

)

Sale of tangible fixed assets

750

21,350

Interest received

-

468

Net cash from investing activities

(439,623

)

(2,239,827

)

Cash flows from financing activities

Loan repayments in year

-

(233,500

)

Group loan repayment

(488,000

)

(240,000

)

Group loan advance

-

500,000

Net cash from financing activities

(488,000

)

26,500

Increase in cash and cash equivalents

676,188

213,827

Cash and cash equivalents at beginning of year

2

2,742,966

2,529,139

Cash and cash equivalents at end of year

2

3,419,154

2,742,966

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

2023

2022

£

£

Profit before taxation

1,113,209

1,465,283

Depreciation charges

558,686

465,128

Profit on disposal of fixed assets

(308

)

(9,172

)

Government grants

-

(203,106

)

Finance income

(7,710

)

(468

)

1,663,877

1,717,665

Increase in stocks

(5,827

)

(22,107

)

Decrease in trade and other debtors

26,838

174,060

(Decrease)/increase in trade and other creditors

(31,675

)

205,259

Cash generated from operations

1,653,213

2,074,877

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 31 January 2023

31.1.23

1.2.22

£

£

Cash and cash equivalents

3,419,154

2,742,966

Year ended 31 January 2022

31.1.22

1.2.21

£

£

Cash and cash equivalents

2,742,966

2,529,139

3.	ANALYSIS OF CHANGES IN NET FUNDS

At 1.2.22

Cash flow

At 31.1.23

£

£

£

Net cash

Cash at bank and in hand

2,742,966

676,188

3,419,154

2,742,966

676,188

3,419,154

Total

2,742,966

676,188

3,419,154

1.	STATUTORY INFORMATION

Sandburn York Limited is a private company, limited by shares , registered in England and Wales. The company's registered number and registered office address can be found on the Company Information page.

The company's principal place of business is Sandburn Hall, Flaxton, York, YO60 7RB.

2.	ACCOUNTING POLICIES

Basis of preparing the financial statements

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 have been prepared under the historical cost convention as modified by the revaluation of certain assets.

The directors have considered the financial position and trading projections of the company, and have a reasonable expectation that the company has adequate resources to continue to trade into the foreseeable future. The company therefore continues to adopt the going concern basis in preparing the financial statements.

Turnover

Turnover represents amounts receivable for good and services supplied by the company to its customers in the course of its principal activities, after the deduction of trade discounts and value added tax.

Turnover is recognised when the goods or services have been supplied to the customer. Deposits and other amounts received in advance are deferred, and included in creditors, until the stay, event or other service has been supplied.

Tangible fixed assets

Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life.

Freehold property

-

1% - 2% on cost

Assets under construction

-

not provided

Plant and machinery

-

25% on reducing balance

Fixtures and fittings

-

20% straight line, 10% straight line, 5% straight line and between 10% and 33.33% on net book value

Motor vehicles

-

25% on reducing balance

Tangible fixed assets are measured at cost less accumulated depreciation and any accumulated impairment losses.

Freehold property relates to the properties and development of the Sandburn Hall Estate as carried out by the company; the underlying land is however under the ownership of the parent company.

Government grants

Revenue grants are credited to the profit and loss account so as to match them with the expenditure to which they relate. Grants that are receivable as compensation for expenses or losses already incurred or for the purpose of giving immediate financial support to the entity are recognised in the period in which they become receivable

Capital grants received towards the tangible fixed assets are included in creditors as deferred income and credited to the profit and loss account over the life of the asset.

Investment property

Investment property is shown at most recent valuation. Any aggregate surplus or deficit arising from changes in fair value is recognised in profit or loss.

Rental income from investment properties is recognised on a straight line basis over the term of the relevant lease.

Stocks

Stocks are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items.

The company uses the most recent purchase price as the basis for arriving at cost for most stock types, as the result is considered to approximate actual cost.

Taxation

Taxation for the year comprises current and deferred tax. Tax is recognised in the Statement of Comprehensive Income, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

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.

Pension costs and other post-retirement benefits

The company operates a defined contribution pension scheme. Contributions payable to the company's pension scheme are charged to profit or loss in the period to which they relate.

Financial instruments

The company is supported by way of a loan from its parent company.

Under its terms, this loan is interest free, unsecured and repayable on demand within one year and one day. These terms are set on a rolling annual basis.

The loan is recognised as a creditor falling due after more than 1 year, and recorded at transaction price; being the balance of funds received and repaid at the balance sheet date. Amortised cost, using the effective interest rate method, is not considered to be appropriate given the terms of the loan.

Cash at bank includes amounts held on demand in current account, and on short term fixed deposit.

Operating leases

Operating lease rentals are charged in the profit and loss account on a straight line basis over the lease term.

Judgements and key sources of estimation uncertainty

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

Depreciation and residual values

The directors have reviewed the asset lives and associated residual values of all fixed asset classes, and concluded that the company's depreciation policies are appropriate.

Valuation of investment property

Investment properties are included in the financial statements at an estimate of fair value, as determined by the directors. This valuation is informed by the use of professional experts and industry knowledge within the company, and is based upon rental yield and general market conditions.

3.

TURNOVER

The turnover and profit before taxation are attributable to the principal activities of the company.

An analysis of turnover by class of business is given below:

2023

2022

£

£

Holiday lodges

2,285,911

2,404,432

Golf and leisure activities

3,434,722

2,236,749

Hotel

1,299,502

871,447

7,020,135

5,512,628

4.	EMPLOYEES AND DIRECTORS

2023

2022

£

£

Wages and salaries

2,179,025

1,703,049

Social security costs

173,310

129,696

Other pension costs

80,216

27,811

2,432,551

1,860,556

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

2023

2022

Admin and management

14

13

Services

105

79

119

92

5.	DIRECTORS' EMOLUMENTS

2023

2022

£

£

Directors' remuneration

148,438

175,496

Directors' pension contributions to money purchase schemes

47,229

3,951

The number of directors to whom retirement benefits were accruing was as follows:

Money purchase schemes

3

3

6.	OPERATING PROFIT

The operating profit is stated after charging/(crediting):

2023

2022

£

£

Operating lease income

(95,131

)

(102,583

)

Depreciation - owned assets

558,686

465,128

Profit on disposal of fixed assets

(308

)

(9,172

)

Operating lease expenditure

22,916

14,116

Auditor's remuneration

7,400

9,000

Government grants receivable

-

(203,106

)

Other operating income includes government grant funding of £Nil (2022: £203,106) received in relation to the Covid-19 pandemic and associated UK national lockdowns.

This was made up of £132,386 received under the Coronavirus Job Retention Scheme (CJRS), and £70,270 from Local Restriction Support, Restart and related local authority grants.

7.

INTEREST RECEIVABLE AND SIMILAR INCOME

2023

2022

£

£

Deposit account interest

7,710

-

Other interest receivable

-

468

7,710

468