Queenscourt Limited - Limited company accounts 23.1

REGISTERED NUMBER: 03007613 (England and Wales)

Queenscourt Limited

Strategic Report, Report of the Directors and

Financial Statements For The Year Ended 30 September 2022

Page

Company Information

1

Strategic Report

2

Report of the Directors

4

Report of the Independent Auditors

6

Statement of Income and Retained Earnings

9

Statement of Financial Position

10

Statement of Cash Flows

11

Notes to the Statement of Cash Flows

12

Notes to the Financial Statements

13

DIRECTORS:

B C Patel

Mrs M B Patel

REGISTERED OFFICE:

QFM House

Atlas Way

10 Brightside Lane

Sheffield

South Yorkshire

S9 3YE

REGISTERED NUMBER:

03007613 (England and Wales)

AUDITORS:

Kingswood Allotts Limited, Statutory Auditor

Chartered Accountants

Sidings Court

Lakeside

Doncaster

South Yorkshire

DN4 5NU

BANKERS:

HSBC

HSBC Corporate Banking

Grosvenor House

1 Wellington Street

Sheffield

S1 4NB

SOLICITORS:

Freeths LLP

Fifth Floor

3 St Paul's Place

129 Norfolk Street

Sheffield

S1 2JE

The directors present their strategic report for the year ended 30 September 2022.

REVIEW OF BUSINESS

The principal activity of the company is the operation of quick-service restaurants (QSR's).

Results and performance

The results for the company for the year can be summarised as follows:

2022

2021

£'000

£'000000

Sales

16,800

16,160

Gross profit

5,956

7,051

Operating (loss)/profit

(256

)

2,649

Turnover during the year increased by 4%, but owing to the inflationary pressure on cost of goods and labour, the gross profit margin was down. 2021 sales figures are inflated due to the VAT benefit from the temporary hospitality rate. If figures are restated to exclude the VAT benefit from both years, turnover would have been up by 12%, with the gross margin would be on a par with the previous year.

Key performance indicators

The management team use a number of models to assess both viability of new stores and existing ones.

At an operational level, the main KPIs are considered to be cost of sales and labour costs as a percentage of turnover as a daily driver, along with a pre-determined minimum turnover level in each store, represented in a break-even model. There is an ongoing review of PBIT (Profit Before Interest and Taxation) and EBITDA (Earnings Before Interest, Tax, Depreciation and Amortisation).

During the year the company saw a decline in it's operational KPIs, as outlined above, due to the general economic climate. It is estimated that the increased cost of utilities alone have impacted the bottom line by over £800,000.

The company opened 1 new store during the year, and refurbished an existing store. Sales growth continues to be the main focus.

Non-Financial key performance indicators

The companys key non-financial performance indicator is guest satisfaction. This has shown satisfactory performance throughout the year.

Future developments

Due to the uncertainty of the economic environment as at the date of signing, there are currently no major acquisitions planned. The directors continue to monitor the market.

PRINCIPAL RISKS AND UNCERTAINTIES

The principal uncertainties surrounding the business are:

i) The general economic environment with rising inflation and, in particular, high cost of goods and energy prices

ii) Competition withing the QSR market, though the brand continues to be a UK market leader

iii) Changes in consumer habits, with customers looking for healthier or meat-free options. Though the brand continues to put product development at the forefront, giving customers a wide range of options

iv) The UK hospitality sector is experiencing extra-ordinary challenges in recruitment, which is driving up the cost of labour industry wide

v) Rising interest rates impacting cashflow and debt service ratios

The directors continue to focus on driving the business forward through improvements to operational performance in existing stores and looking at new opportunities within the market.

Despite the current year losses, the balance sheet remains strong with an improvement in liquidity from the prior year.

SECTION 172(1) STATEMENT

As the directors of Queenscourt Limited we have a legal responsibility under section 172 of the Companies Act 2006 to act in a way we consider, in good faith, would be most likely to promote the company's success for the benefit of the member as a whole, and to have regard to the long-term effect of our decisions on the group and its stakeholders. This statement addresses the ways in which we, as directors, have considered this responsibility.

Promoting the company and the group's success for its members

Queenscourt Limited is fully owned by the directors, therefore we are the only members of the company. As we are involved in the decision making process, this ensures that fairness is maintained between all members of the company. We aim to develop the company to not only provide financial rewards for ourselves, but to give back to our employees and to develop new brands for our consumers.

We make strategic decisions to enable the wider group to grow and develop; whether that results in an individual company growing larger, or becoming more profitable, is less important than the overall group's development. Where we look to grow the group, either through acquisition of existing stores or development of new stores or brands, this is considered against the abundance of competition within the local area and the potential competition with our existing stores.

Engaging with stakeholders

Our key stakeholders, and the ways in which we engage with them, are listed below.

Our employees - the company and wider group is entirely reliant on staff to ensure the necessary services are delivered to our customers. The group has policies in place to ensure:

-

Staff are remunerated at the appropriate level, dependent upon the role, qualification and experience.

-

Bonuses are set at a level which is motivational, but not unachievable

-

Staff in key management roles are involved in decision making processes to ensure that they represent the interests of those below them, at all levels.

Our customers - we understand that maintaining a good relationship with our customers is vital for the continuation of our brands. We strive to maintain a high level of service and cleanliness within all of our stores. We undertake internal audits and third party brand audits to ensure that those levels are achieved and maintained. Stores that fall below expectation are given additional support and training, in order to bring them back in line.

Our suppliers - we recognise that the supply chain is key to ensuring the smooth operation within all of our stores. We maintain a good working relationship with our key suppliers, to ensure that we can retain a high-quality service.

Our franchise partners - a good working relationship with the brand is imperative to enable our stores to continue to trade. We work closely with the brand to ensure our future development and overall strategies are congruent with those of the brand. We strive for excellence and are therefore always looking at ways we can improve the quality of both services and products provided in our stores.

Our community - we appreciate that the local communities are vital to the success of our stores and as such, wherever possible, we try to employ local residents within our stores. We promote community spirit by supporting local charities and events. We take customer feedback very seriously and take the necessary action when issues are reported. We do not tolerate any instances of abusive or anti-social behaviour within or around our stores.

Our planet - we always strive to be environmentally friendly in how we operate. We actively engage with energy specialists to monitor and understand our energy usage, allowing us to make operational changes at both company and store level, with an aim to reduce our energy emissions, wherever possible. We try to minimise the use of vehicles; although there is a need to have goods delivered to our stores on a regular basis, we try to consolidate deliveries as much as practicable. We constantly strive to make improvements in our waste managements through recycling opportunities and efficiencies within our operational processes.

ON BEHALF OF THE BOARD:

B C Patel - Director

13 June 2023

The directors present their report with the financial statements of the company for the year ended 30 September 2022.

DIVIDENDS

No dividends will be distributed for the year ended 30 September 2022.

FUTURE DEVELOPMENTS

Since the year end the company has continued to adapt to changing customer engagement to maintain its position in the market place. The directors continue to look at potential options for further development either within existing stores or by identifying new sites.

DIRECTORS

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

B C Patel

Mrs M B Patel

EMPLOYMENT OF DISABLED PERSONS

The company policy is to recruit disabled workers for vacancies which they are able to fill.

Requirements of employees who become disabled will be reviewed to ensure that every possible reasonable adjustment is made to enable them to remain in employment with the company. Promotion opportunities, benefits and facilities of employment will not be unreasonably limited and every reasonable effort will be made to ensure that disabled employees participate fully in the workplace.

EMPLOYEE INVOLVEMENT

The company considers it important that employees are well informed on all aspects of its affairs as far as the needs of commercial and financial confidentiality will permit.

FINANCIAL INSTRUMENTS

Liquidity

The company is partly funded by bank loans and overdrafts, which require a number of banking covenants to be met. These incur a market rate of interest, therefore uplifts in the base rate of interest will result in increases in costs.

The company has no exposure to the risk of trade debts going bad as the nature of the industry is payment upon supply of the product.

DISCLOSURE OF INFORMATION IN THE STRATEGIC REPORT

As allowed under section 414C (121) of the Companies Act 2011 the directors have chosen to disclose certain items required within the directors report in the strategic report. This includes details of how the directors consider the continuous development of relationships with suppliers, customers and others to be important to the business.

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, Kingswood Allotts Limited, Statutory Auditor, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

B C Patel - Director

13 June 2023

Opinion

We have audited the financial statements of Queenscourt Limited (the 'company') for the year ended 30 September 2022 which comprise the Statement of Income and Retained Earnings, Statement of Financial Position, Statement of Cash Flows and Notes to the 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 company's affairs as at 30 September 2022 and of its 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 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 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 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:

-

We obtained an understanding of the legal and regulatory frameworks applicable to the company and the sector in which they operate. We determined that the following laws and regulations were most significant; the Companies Act 2006, Food Standards Act 1999, Food Hygiene Regulations, Employment Law, Health and Safety regulations and UK corporate taxation laws.

-

We obtained an understanding of how the company are complying with those legal and regulatory frameworks by making inquiries to relevant members of the management team. We corroborated our inquiries though our review of internal store audits and enquiry into legal fees incurred in the year.

-

We assessed the susceptibility of the company's financial statements to material misstatement, including how fraud might occur. Audit procedures performed by the engagement team included:

-

Identifying the controls management has in place to prevent and detect fraud and assessing the operation of these controls;

-

Understanding of how those charged with governance considered and addressed the potential for override of controls or other inappropriate influence over the financial reporting process;

-

Identifying and testing journal entries, in particular any journal entries that were large or unusual in nature;

-

Assessing the extent of compliance with the relevant laws and regulations governing the company and the sector it operates within. This included a review of any potential breaches during and since the year end; and

-

Challenging assumptions and judgements made by management in its significant accounting estimates.

There are inherent limitations in the audit procedures described above and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements the less likely we would become aware of it. The risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error as fraud may involve deliberate concealment by, for example, forgery, intentional misrepresentations or through collusion.

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.

Steven Pepper FCA (Senior Statutory Auditor)

for and on behalf of Kingswood Allotts Limited, Statutory Auditor

Chartered Accountants

Sidings Court

Lakeside

Doncaster

South Yorkshire

DN4 5NU

13 June 2023

TURNOVER

3

16,799,818

16,159,772

Cost of sales

10,843,509

9,109,216

GROSS PROFIT

5,956,309

7,050,556

Administrative expenses

8,437,831

6,780,258

(2,481,522

)

270,298

Other operating income

4

2,225,189

2,378,312

OPERATING (LOSS)/PROFIT

7

(256,333

)

2,648,610

Interest receivable and similar income

66,947

-

(189,386

)

2,648,610

Interest payable and similar expenses

9

37,528

34,178

(LOSS)/PROFIT BEFORE TAXATION

(226,914

)

2,614,432

Tax on (loss)/profit

10

(40,971

)

505,476

(LOSS)/PROFIT FOR THE FINANCIAL YEAR

(185,943

)

2,108,956

Profit and loss account at beginning of year

6,896,811

4,787,855

PROFIT AND LOSS ACCOUNT AT END OF YEAR

6,710,868

6,896,811

FIXED ASSETS

Intangible assets

11

127,273

120,325

Tangible assets

12

3,379,951

3,530,225

3,507,224

3,650,550

CURRENT ASSETS

Stocks

13

74,363

73,512

Debtors

14

1,456,417

746,926

Cash at bank and in hand

5,808,175

14,421,774

7,338,955

15,242,212

CREDITORS

Amounts falling due within one year

15

2,668,264

10,447,816

NET CURRENT ASSETS

4,670,691

4,794,396

TOTAL ASSETS LESS CURRENT LIABILITIES

8,177,915

8,444,946

CREDITORS

Amounts falling due after more than one year

16

(1,425,168

)

(1,499,210

)

PROVISIONS FOR LIABILITIES

20

(41,779

)

(48,825

)

NET ASSETS

6,710,968

6,896,911

CAPITAL AND RESERVES

Called up share capital

21

100

100

Profit and loss account

22

6,710,868

6,896,811

SHAREHOLDERS' FUNDS

6,710,968

6,896,911

The financial statements were approved by the Board of Directors and authorised for issue on 13 June 2023 and were signed on its behalf by:

B C Patel - Director

Cash flows from operating activities

Cash generated from operations

1

279,634

3,118,785

Interest paid

(36,184

)

(33,043

)

Interest element of hire purchase payments paid

(1,344

)

(1,135

)

Tax paid

(456,651

)

-

Net cash from operating activities

(214,545

)

3,084,607

Cash flows from investing activities

Purchase of intangible fixed assets

(21,674

)

(61,380

)

Purchase of tangible fixed assets

(774,211

)

(832,871

)

Sale of tangible fixed assets

105,876

15,000

Interest received

66,947

-

Net cash from investing activities

(623,062

)

(879,251

)

Cash flows from financing activities

Loan repayments in year

(60,748

)

(171,496

)

Capital repayments in year

(17,308

)

(5,901

)

Amount introduced by directors

10,297

-

Movement in related party balances

(7,708,233

)

5,168,645

Net cash from financing activities

(7,775,992

)

4,991,248

(Decrease)/increase in cash and cash equivalents

(8,613,599

)

7,196,604

Cash and cash equivalents at beginning of year

2

14,421,774

7,225,170

Cash and cash equivalents at end of year

2

5,808,175

14,421,774

1.	RECONCILIATION OF (LOSS)/PROFIT FOR THE FINANCIAL YEAR TO CASH GENERATED FROM OPERATIONS

2022

2021

£

£

(Loss)/profit for the financial year

(185,943

)

2,108,956

Depreciation charges

848,277

659,476

Profit on disposal of fixed assets

(14,942

)

(1,735

)

Finance costs

37,528

34,178

Finance income

(66,947

)

-

Taxation

(40,971

)

505,476

577,002

3,306,351

(Increase)/decrease in stocks

(851

)

3,328

Increase in trade and other debtors

(49,016

)

(93,630

)

Decrease in trade and other creditors

(247,501

)

(97,264

)

Cash generated from operations

279,634

3,118,785

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 September 2022

30.9.22

1.10.21

£

£

Cash and cash equivalents

5,808,175

14,421,774

Year ended 30 September 2021

30.9.21

1.10.20

£

£

Cash and cash equivalents

14,421,774

7,225,170

3.	ANALYSIS OF CHANGES IN NET FUNDS

At 1.10.21

Cash flow

At 30.9.22

£

£

£

Net cash

Cash at bank and in hand

14,421,774

(8,613,599

)

5,808,175

14,421,774

(8,613,599

)

5,808,175

Debt

Finance leases

(17,308

)

17,308

-

Debts falling due within 1 year

(121,496

)

(2,431

)

(123,927

)

Debts falling due after 1 year

(1,488,347

)

63,179

(1,425,168

)

(1,627,151

)

78,056

(1,549,095

)

Total

12,794,623

(8,535,543

)

4,259,080

1.	STATUTORY INFORMATION

Queenscourt 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.

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.

Accounting reference date

The company has taken advantage of the provisions in section 390 of the Companies Act 2006 which allow the company to make accounts up to a date within seven days of the accounting reference date. The company operates its management reporting in four weekly periods and consequently these financial statements are made up to 2nd October 2022 (2021: 3rd October 2021).

Judgements and key sources of estimation uncertainty

In the process of applying the company's accounting policies, the directors are required to make certain estimates, judgements and assumptions that they believe are reasonable based upon the information available. These estimates and assumptions affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the periods presented.

Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

Actual results may differ from the estimates, the effect of which is recognised in the period in which the facts that give rise to the revision become known.

The estimate and assumptions that have a significant risk of causing material adjustment to the carrying amounts of assets and liabilities within the next financial year are as follows:

Useful life and residual values

Intangible assets

The charge in respect of amortisation is derived after determining an estimate of the useful life. The estimate is based on a variety of factors such as expected use, the expected useful life of the cash generating unit or contractual provisions that can limit the useful life and assumptions that market participants would consider in respect of similar businesses.

Tangible assets

The charge in respect of depreciation is derived after determining an estimate of an asset's expected useful life and the expected residual value at the end of its life. The useful lives and residual values of the company';s assets may vary depending on several factors such as,technological innovation, maintenance programmes and future market conditions. They are determined by management at the time the asset is acquired and reviewed annually for appropriateness.

Leases

Determining whether leases entered into by the company as a lessee are operating or finance leases requires judgement. These decisions depend on an assessment of whether the risks and rewards of ownership have been transferred from the lessor to the lessee based on the evaluation of the terms and conditions of the arrangements on a lease by lease basis.

Government grants

Government and local authority grants are recognised at the fair value of the asset received or receivable. Grants are not recognised until there is reasonable assurance that the company will comply with the conditions attaching to them and the grants will be received.

Revenue recognition

Turnover represents the value of goods sold, net of Value Added Tax.

Intangible assets

Intangible assets are initially recorded at cost and are subsequently stated at cost less any accumulated amortisation and impairment losses. Intangible assets acquired as part of a business combination are recorded at the fair value at the acquisition date.

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:

Franchise fees

- Over the length of the contract

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.

Tangible assets

Tangible assets are initially recorded at cost, and subsequently stated at cost less any accumulated depreciation and impairment losses.

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:

Freehold property

-

2.5% straight line

Leasehold property

-

Over the period of the lease

Plant and machinery

-

15% - 20% straight line

Motor vehicles

-

25% straight line

Investments

Fixed asset investments are initially recorded at cost, and subsequently stated at cost less any accumulated impairment losses.

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.

Stocks

Stock is valued at the lower of cost and net realisable value. Cost is computed on a first in first out basis.

Provisions

Provisions are recognised when the entity has an obligation at the reporting date as a result of a past event, it is probable that the entity will be required to transfer economic benefits in settlement and the amount of the obligation can be estimated reliably. Provisions are recognised as a liability in the statement of financial position and the amount of the provision as an expense.

Provisions are initially measured at the best estimate of the amount required to settle the obligation at the reporting date and subsequently reviewed at each reporting date and adjusted to reflect the current best estimate of the amount that would be required to settle the obligation. Any adjustments to the amounts previously recognised are recognised in profit or loss unless the provision was originally recognised as part of the cost of an asset. When a provision is measured at the present value of the amount expected to be required to settle the obligation, the unwinding of the discount is recognised as a finance cost in profit or loss in the period it arises.

Financial instruments

Debtors and creditors with no stated interest rate, and repayable within one year, are recorded at transaction price. Any losses arising from impairment are recognised in the income statement in other administrative expenses.

Defined contribution plans

Contributions to defined contribution plans are recognised as an expense in the period in which the related service is provided.

Taxation

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

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the statement of financial position date.

Deferred tax

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the statement of financial position 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.

3.

TURNOVER

Turnover arises from:

2022

2021

£

£

Sale of goods

16,799,818

16,159,772

The whole of the turnover is attributable to the principal activity of the company wholly undertaken in the United Kingdom.

4.	OTHER OPERATING INCOME

2022

2021

£

£

Retail, hospitality and leisure support grant

-

349,342

Coronavirus job retention scheme grant

-

189,123

Sundry receipts

94,411

41,509

Rents receivable

63,712

85,095

Management charges receivable

2,067,066

1,713,243

2,225,189

2,378,312

5.	EMPLOYEES AND DIRECTORS

2022

2021

£

£

Wages and salaries

5,307,593

4,604,964

Social security costs

363,010

292,495

Other pension costs

77,515

62,551

5,748,118

4,960,010

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

2022

2021

Office and management

53

53

Store operation staff

362

346

415

399

6.	DIRECTORS' EMOLUMENTS

2022

2021

£

£

Directors' remuneration

181,077

172,855

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

Defined benefit schemes

2

2

7.	OPERATING (LOSS)/PROFIT

The operating loss (2021 - operating profit) is stated after charging/(crediting):

2022

2021

£

£

Hire of plant and machinery

41,418

36,134

Depreciation - owned assets

833,551

642,390

Profit on disposal of fixed assets

(14,942

)

(1,735

)

Franchise fees amortisation

14,726

17,086

Operating lease rentals

1,081,226

999,856

8.	AUDITORS' REMUNERATION

2022

2021

£

£

Fees payable to the company's auditors for the audit of the company's financial statements

8,500

5,500

9.

INTEREST PAYABLE AND SIMILAR EXPENSES

2022

2021

£

£

Interest on bank loans and overdrafts

36,184

33,043

Interest on hire purchase and finance lease contracts

1,344

1,135

37,528

34,178

10.

TAXATION

Analysis of the tax (credit)/charge

The tax (credit)/charge on the loss for the year was as follows:

2022

2021

£

£

Current tax:

UK corporation tax

(33,925

)

456,651

Deferred tax

(7,046

)

48,825

Tax on (loss)/profit

(40,971

)

505,476