CD_WELCOMBE_HOLDCO_LIMITE - Accounts

The directors of the company have elected not to include a copy of the profit and loss account within the financial statements.true

These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies regime.

CD Welcombe Holdco Limited is a private company limited by shares incorporated in England and Wales. The registered office is 2nd Floor, 32-33 Gosfield Street, London, W1W 6HL.

The financial statements for the current period have been prepared for a year. The prior period was a short accounting period due to including the company's commencement of trade. For this reason, the comparative amounts presented in the financial statements (including the related notes) will not be entirely comparable.

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £'000.

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements:

• Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;

• Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues: Interest income/expense and net gains/losses for financial instruments not measured at fair value; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;

• Section 26 ‘Share based Payment’: Share-based payment expense charged to profit or loss, reconciliation of opening and closing number and weighted average exercise price of share options, how the fair value of options granted was measured, measurement and carrying amount of liabilities for cash-settled share-based payments, explanation of modifications to arrangements;

• Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.

The financial statements of the company are consolidated in the financial statements of Conquer Dawn Limited. These consolidated financial statements are available from its registered office, 2nd Floor, Palmerston House, Denzille Lane, Dublin, Ireland.

At the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.true

The directors foresee the going concern of the business for 12 months from the approval of the financial statements based on the ongoing strong performance of the underlying trading entities of the group, alongside the value of the properties that support the trading structure of the group. With the ongoing support of external lenders in order to support the financial base of the business and fund any required capital work the directors are confident that the strength of the tangible and trading assets are to only improve in the foreseeable future. This will ensure that the group of entities and this company will be able to meet and manage relevant financial and non-financial commitments for the foreseeable future.

The directors are aware that the period in which has been reported includes COVID-19. This resulted in a fall in the profitability and income generated was as a result of the global conditions paramount at that time. Subsequent to this period the directors have overseen a period of growth and stability in the trading capacity of the hotel that has allowed it to continue funding the financial requirements and day to day working capital of the business. To this extent, the directors have comfort and support that they can obtain funds as required in order to precipitate any future and ongoing cashflow issues that may arise in the business.

This further support and growth in the business post year end includes post a refinancing of debt of £2.2m in CD Welcombe Holdco Limited, and continued financial support from the ultimate parent company in the period by way of long-term debts. This input of working capital has allowed the group of companies to continue to service debt where due and grow the business. This is further supported by the seeking to obtain 3rd party funding in order to develop and grow the business and the hotel infrastructure in the coming years as part of its investment programme.

The directors are aware of external factors and change in economic environments that will have an impact on the business and its related entities. To this extent they are actively working alongside relevant industry specialists, and external partners, such as HM Revenue & Customs in order to overcome and resolve these issues as they arise.

As such, due to the ongoing support of the main lenders of the group entities, the financial and continued support of the shareholders and directors of the business, and underlying performance of the business and asset value, the directors are confident that the company is a going concern for 12 months from the date of the signing of the balance sheet.

Turnover is in relation to interest accrued and received in respects to intercompany loans.

Interests in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.

A subsidiary is an entity controlled by the company. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The company considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.

Entities in which the company has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.

Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.

Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.

In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

Impairment of loans to subsidiaries

There is a continual and ongoing assessment and review of recoverability of debts due to and or from related entities. Assessment of this is taken by the underlying operating entities ability to help service the relevant debts as part of the financing arrangement of the group.

The average monthly number of persons (including directors) employed by the company during the year was:

The long term loan of £6,150,000 (2021: £5,750,000) is advanced to wholly owned subsidiary company CD Welcombe Limited, repayable in full on 10 September 2026. Interest payable is agreed at 12.5% per annum accruing daily. This rate is considered appropriate in accordance with the arms length principle of the OECD guidelines.

Subsequent to the year end, S. The Welcombe Stratford Upon Avon Opco Limited was dissolved. The entity was dormant throughout the period.

Details of the company's subsidiaries at 31 December 2022 are as follows:

Debtors includes interest on loan advanced to wholly owned subsidiary CD Welcombe Limited of £759,000 (2021: £84,000) and amount receivable towards share capital from the parent company, CD Welcombe Topco Limited, of £1 (2021: £1).

Amounts owed by group undertakings are repayable on demand.

Creditors includes interest on loan payable to CD Welcombe Topco Limited of £462,000 (2021: £48,000) and amounts payable towards share capital for investment in wholly owned subsidiary, CD Welcombe Limited, of £100 (2021: £100).

Amounts due to group undertakings are repayable on demand.

The long term debt relates to a £4,017,000 (2021: £3,550,000) loan with parent company CD Welcombe Topco Limited, which is repayable in full on 3 November 2026. Interest payable is agreed at 12.5% per annum accruing daily. This rate is considered appropriate in accordance with the arms length principle of the OECD guidelines.

The bank loans and overdrafts relates to a £2,200,000 (2021: £2,200,000) term loan facility with Mar Hall Estates Limited, which was fully paid within the year. Interest payable is agreed at the percentage rate per annum which is the fixed rate; means 6% per annum.

As the income statement has been omitted from the filing copy of the financial statements, the following information in relation to the audit report on the statutory financial statements is provided in accordance with s444(5B) of the Companies Act 2006:

The auditor's report was unqualified.

Key audit matters

Except for the matter described in the Material uncertainty related to going concern section, we have determined that there are no other key audit matters to be communicated in our report.

The long term debt of £4,017,000 (2021: £3,550,000) relates to a loan from parent company Conquer Dawn Limited, repayable in full on 3 November 2026. Interest payable is agreed at 12.5% per annum accruing daily. This rate is considered appropriate in accordance with the arms length principle of the OECD guidelines.

The company has a fixed charge dated on 2 November 2021 with Mar Hall Estates Limited (as a Security Agent). This is in relation to a facility agreement entered by CD Welcombe Limited. The charge contains negative pledges, fixed charge and floating charges covering this company and all group company property and undertakings.

The company refinanced the debt held by Mar Hall Estates Limited in respects to additional funding arising from the ultimate parent company.

The parent company of CD Welcombe Holdco Limited is CD Welcombe Topco Limited, which is both consolidated itself and is consolidated within the group accounts of Conquer Dawn Limited. The registered office is 2nd Floor, Palmerston House, Denzille Lane, Dublin, Ireland. The financial statements of the group are available from the registered office.

There are no ultimate controlling parties.