ARK_DATA_CENTRES_LIMITED - Accounts
ARK_DATA_CENTRES_LIMITED - Accounts
The directors present the strategic report for the year ended 30 June 2023.
The principal activity of the company and the group is the design, construction and operation of data centres and the provision of related services.
Business review
Through its related undertakings, the Ark group of companies owns and operates data centres campuses at Cody Park, Spring Park and Meridian Park:
Ark Estates Cody Park Limited owns the Cody Park site, which had 48.78 MW (2022: 48.78 MW) of built capacity as of 30 June 2023, split across 5 buildings. In addition, 800kW of further capacity is under construction.
Ark Estates Spring Park Limited owns the Spring Park site, which had 41.68 MW (2022: 41.68 MW) of built capacity as of 30 June 2023, split across 5 buildings, with a further 13.5MW under construction.
Ark A9 GP Limited owns the A9 building, which has a built capacity of 1.6MW (2022: 1.6MW).
Ark Estates Enfield Limited owns Meridian Park, which has a built capacity of 16.36 MW (2022: 16 MW).
Financial indicators
The Board of Directors are therefore pleased to report the following financial results:
| 2023 (£) | 2022 (£) | Change (£) | % Change |
Turnover | 195,881,114 | 153,279,158 | 42,601,956 | +27.79% |
Gross Profit | 25,378,410 | 20,577,044 | 4,801,366 | +23.33% |
Operating Profit/(Loss) | 1,652,332 | (3,095,320) | 4,747,652 | +153.38% |
Profit/(Loss) for Year | (781,502) | (3,521,818) | 2,740,316 | +77.81% |
Net Assets | 25,257,355 | 26,038,857 | (781,502) | -3.00% |
Ark Data Centres Limited (“Ark”) owns 74.9% of the ordinary share capital of Crown Hosting Data Centres Limited (“Crown Hosting”). Crown Hosting is a joint venture between Ark and The Minister for the Cabinet Office and operates a public sector framework for the procurement of data centre services.
Non-financial indicators
Alongside the financial performance, the key performance indicators of the Company include:
MW capacity (built, contracted and available)
contract term
build costs
delivering in accordance with build programmes
maintaining operational excellence
stakeholder (customer and suppler) satisfaction scores
In addition, the group will continue to build out new facilities on its existing sites, and through its related undertakings at additional sites in and around London – Union Park, Longcross Park and Alliance Park – to meet the growing demand for colocation and cloud data centres.
The business plan of Ark is built around a long-term strategy and significant progress has been made during the year to 30 June 2023. During the current reporting period the group has secured new long-term contracts with customers from both public and private sectors across multiple industries including UK Government, Financial Services, Telecommunications, Cloud Providers and IT. The sales pipeline remains strong and further growth is expected through Ark’s existing customers, framework agreements and new customers. The Board of Directors believe that the Company’s position within the marketplace remains strong, and we look forward to further expansion in 2024.
Principal risks faced by the Company are identified and monitored through a regular process that is reviewed by the Senior Leadership Team and presented to the Board of Directors. Principal risks include, but are not limited to:
Operational risks from a power or cooling outage or a security breach. The Company places a primary focus on preventative measures and controls to address these risks through its design and construction of the facilities and operation of robust accredited processes and regular maintenance programmes. Additionally, the Company undertakes regular exercises, involving our employees, customers and supply chain, across multiple scenarios to test the application and robustness of its procedures.
Performance in an increasingly competitive marketplace is continually monitored. The Company engages proactively with its customers, both existing and prospective, to understand their requirements and has continuously progressed innovation in data centre design and construction to meet those needs and drive efficiencies.
Uncertainty of current economic conditions may impact supply and/or development arrangements, although this is largely mitigated by entering into fixed priced contracts for the construction of the data centres and ensuring critical supplies are available when needed.
The Company manages these risks on an ongoing basis, and the Board of Directors believe that the Company’s offering within the marketplace remains strong, and that it is well positioned to continue its growth.
No events have occurred since the balance sheet date which significantly affect the Company.
The Directors are required to make a statement which describes how they have acted in accordance with their duties to promote the success of the company for the benefits of the members as a whole. These duties are set out in Section 172(1) of the Companies Act 2006 and are summarised below along with the actions undertaken by the Board.
The likely consequences of any decision in the long-term
The Directors insist on high operating standards and fiscal discipline and routinely engage with management and employees of the company to understand the underlying issues within the organisation. Additionally, the Board looks outside the organisation at macro factors affecting the business. The Directors consider all known facts when developing strategic decisions and long-term plans, taking into account their likely consequences for the Company. The Group has a well-established governance structure, and all key decisions are made in accordance with that process and, where required, are approved by the ultimate controlling party (Note 25).
The interests of the company’s employees
The Directors and management are committed to the interests and well-being of its employees and undertakes frequent dialogue with all employees to ensure transparency and inclusion. In August 2020, Ark was awarded platinum accreditation, for the second time, against the Investors in People Standard, demonstrating their commitment to high performance through good people management. Investors in People is the international standard for people management, defining what it takes to lead, support and manage people effectively to achieve sustainable results.
The need to foster the company’s business relationships with suppliers, customers, and others
Ark’s relationships with its customers is fundamental to the success of the business. We develop long-term relationships with our customers, engaging in frequent dialogue to discuss performance against our obligations and listen to their needs and plans to deliver world class services for their critical infrastructure.
Ark has developed strong partnerships with its suppliers to maintain relationships that are collaborative and mutually beneficial to all parties. We continue to work with partners who can deliver market leading products and services at high standards whilst developing innovation and efficiencies.
Engagement with debt holders and shareholders occur on an ongoing basis and as questions arise to ensure they are provided with timely and informative communications.
The impact of the company’s operations on the community and the environment
The availability and resilience of the data centres is fundamental to delivering services to customers. The operations team work closely with customers and partners to define, document, test and implement best practice to enhance the efficiency and operations of the data centre facilities. Operational excellence is pivotal to the business and the data centres are certified by the British Standards Institute for Quality Management, Business Continuity, Information Security, Environmental Management and Energy Management Systems.
Ark’s core values are fundamental to the success of the business and are at the heart of everything we do. Ark considers the impact of its business operations and decisions on the community and the environment and directly engages with relevant parties where appropriate.
The desirability of the company maintaining a reputation for high standard of business conduct
Integrity is a core value for Ark’s Directors and employees. We support and provide guidance to all staff so that they do the right thing, behave in an ethical manner and comply with all applicable legal or regulatory requirements in accordance with Ark’s policies including, but not limited to, Anti-bribery and Corruption, Modern Slavery, Environmental and Energy Management. We also eThensure that Ark’s ISO management systems are fit for purpose, well maintained and appropriately controlled, audited, and improved to enable Ark to meet its contractual, certification, regulatory and legislative requirements.
The need to act fairly between members of the company
The Board recognises its responsibilities under section 172 as outlined above and has acted at all times in a way consistent with promoting the success of the Company with regard to all stakeholders.
On behalf of the board
The directors present their annual report and audited financial statements for the year ended 30 June 2023.
The results for the year are set out on page 13.
No ordinary dividends were paid. The directors do not recommend payment of a final dividend.
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
In accordance with the company's articles, a resolution proposing that PricewaterhouseCoopers CI LLP be reappointed as auditors of the company will be put at a General Meeting.
Ark acknowledges that data centres should continue to improve their performance by implementing energy and operational efficiencies when opportunities arise that make commercial sense. By saving energy we will simultaneously make cost savings, benefitting our clients, ourselves and ultimately our environment. We therefore monitor, manage and report our energy so that we can take practical steps to improve our energy efficiency.
To do this we:
Quantify our energy consumption (as kWh) and associated CO2e emissions, including indirect emissions, based on recognised international protocols. This includes indirect emissions from Grid electricity.
Relate energy to measure(s) of activity using the Power Usage Effectiveness ("PUE") metric.
Meet our Climate Change Agreement ("CCA") (or equivalent) targets; specifically, year-on-year PUE reduction targets (in comparison to our CCA baseline).
Identify and progress energy-saving projects that can be implemented across our estate to help meet targets, and actively seek new opportunities, by:
Maintaining awareness of any energy-efficient, renewable or low-carbon technologies relevant to the sector.
Regularly conducting internal and external reviews and audits, then acting on the findings.
Ensuring the availability of information and the necessary resources to achieve objectives and targets.
Procure energy efficient products and services (within commercial reason) that impact energy performance.
Procure green or renewable energy for our data centre campuses, unless the cost is prohibitive.
Continue to develop our design and service offerings to ensure that cost effective, energy-efficient products are used to maximum effect.
Maintain regular reviews, inputs and steerage from Ark's Senior Leadership Team relating to energy objectives and targets.
Ensure that sufficient information and resources are available so that our Energy Management objectives and targets are met.
Ark is committed to continually look for ways to improve the efficiency, availability, sustainability and energy performance of our business and will ensure continual improvement through research, lessons learned and listening to our customers and suppliers. This commitment is achieved through the effective and consistent implementation of the Ark Energy Management System, which is certified to ISO 50001:2018.
Ark reports its annual operating energy and carbon usage by calendar year to align with the reporting requirements of our CCA, UKETS, EA Operating Permits and Green Loan Agreements. The information provided below is therefore for the years ended 31 December 2022 and 31 December 2021.
In line with best practice Ark measures data centre performance in terms of PUE as the measure of energy efficiency and Carbon Usage Effectiveness ("CUE") as the measure of carbon efficiency in accordance with BS EN 50600. These relate to the Annual IT power Consumption (kWh) of our customers’ equipment.
Our PUE targets are as defined in our CCA agreements and aligned with our SECR and the Climate Change Data Central Pact ("CNDCP") objectives.
Due to the shared nature of the associated infrastructure, CUE is measured at the Campus level. Our CUE targets are in line with our Carbon Reduction Plan, with the aim of achieving net zero by 2030, with 2019 as the base line year.
Power Usage Effectiveness ("PUE")
Ark has measured and calculated PUE as recommended by the Green Grid since 2014 and now in accordance with BS EN 50600-4-2. Annual PUE targets for each campus have been set as part of our CCA and Green Loan Agreements. Ark continues to meet its PUE performance targets, however the current figures reflect the low IT loads (20-40%) currently operating at campus level and the inherently low delta T arising between the cold (supply side) and hot (exhaust side) of the servers in the data rooms.
Carbon Emissions
Ark has been recording a subset of Scope 1 and Scope 2 emissions since 2014. These have been routinely reported as part of the company’s EU ETS, Climate Change Agreement and ISO 50001 management reporting processes.
In 2019 Ark extended the scope of CO2e emissions reporting to include:
Scope 1 – All operational direct emissions from standby generation and refrigerant (F-Gas) losses..
Scope 2 - Operational indirect emissions from purchased electricity, steam, heating and cooling.
The following Scope 3 operational emissions:
Upstream transportation and distribution.
Waste generated in operations.
Business travel.
Employee commuting and homeworking.
Downstream transportation and distribution.
The greenhouse gas emissions inventory and data presented on page 5 have been prepared following the Greenhouse Gas Protocol Corporate Accounting and Reporting Standard, GHG Protocol Scope 2 Guidance and GHG Protocol Corporate Value Chain (Scope 3) Accounting and Reporting Standard.
Reference has also been made to the UK Government Environmental reporting guidelines and GHG conversions have been prepared using the UK Government conversion factors for company reporting of greenhouse gas emissions.
Scope 1 Emissions
Emissions arising from the operation of standby generators have been derived by calculation as described in our ETS and IED Permits. The calculations have been audited/verified as required to meet our IED/CCA permit obligations and as part of our ISO50001 certifications. This is a continuation of the emissions reporting carried out by Ark since 2014. Since 2019 refrigerant (F-Gas) losses have been obtained from the site FGas registers. These losses have been added to the emissions arising from on site standby generation to provide full Scope 1 emissions reporting.
Scope 2 Emissions
Ark has procured 100% REGO backed renewable energy for Cody Park and Spring Park on a rolling 3-year supply contract since 2017. This sends a strong signal to the Supplier that Ark will require significant renewable energy up to three years ahead of actual demand. This is using market forces to drive the growth of renewable generation, as was the original intent of the REGO scheme.
Meridian Park benefits from a private wire connection to the adjacent Energy from Waste Plant (EfW) operated by London Energy. If the EfW supply is unavailable 100% REGO backed renewable energy is supplied via the utility connection.
The Scope 2 emissions reported are Market Based emissions and those associated with the EfW, as these reflect the actual energy procured.
Scope 3 Emissions
Scope 3 emissions have been compiled by EHS Projects, an external consultancy that has supported Ark to identify and collate data sources suitable for estimating Scope 3 emissions. All Scope 3 emissions data have been verified during emissions calculation and data production.
Carbon Reduction Plan ("CRP")
The carbon data summarised on page 5 has been used to develop the Ark Carbon Reduction Plan ("CRP") with a commitment to Net Zero by 2030. It shows:
Fugitive emissions of F-Gas are the single biggest component of CO2e emissions on the Ark estate. The remediation measures and improved F-Gas maintenance processes implemented in 2020 and 2022 have significantly reduced fugitive emissions to close to the target of 1% of the installed inventory.
Emissions from the EfW Plant providing energy over a direct wire Power Purchase Agreement ("PPA") to the Meridian Park facility is projected to be the largest source of emissions to the Ark estate by 31 December 2023.
The CRP was published in March 2023 and is available on the Ark website.
Sustainability/energy efficient initiatives
Ark’s data centres have been designed with sustainability and energy efficiency in mind from the beginning. Initiatives already in place include:
Continuous design development in its data centres to improve operating efficiencies.
Combined direct air and evaporative cooling systems.
Procuring 100% REGO backed Renewable Energy since 2017.
Photovoltaic panels installed where practicable to support non-critical ancillary services in data centres.
Energy efficient (LED) light fittings with motion sensors installed as standard, where applicable.
Efficient variable speed fans and pumps with appropriate controllers matching utilisation to demand installed as standard.
Energy efficient UPS systems, etc are all deployed as standard.
Transition from LV Standby Generation to HV Standby Generation, this reduces installed capacity by ~30%, reduces emissions by the equivalent amount and reduces the volume of onsite fuel storage by 30%.
Replacing diesel fuel with Hydrotreated Vegetable Oil (HVO) by Q2 2022. This has reduced fossil CO2e emissions by ~95%, NOx emissions by ~17% and particulate emissions by ~29%,
Replacing all single port valves on compressors with dual port valves and improving FGas management procedures to minimise FGas losses during maintenance in future,
BREEAM Certification across all Ark data centres.
Ark has a number of process improvements and projects underway that could lead to further sustainability improvements and carbon reductions in future:
Reviewing customer SLA requirements against customer ESG goals to assess whether their IT can be operated more efficiently.
Progressing a feasibility study to replace the refrigerant (F-Gas) in older cooling plant with a newer refrigerant that has a significantly lower Global Warming Potential (GWP). If the feasibility study demonstrates that the proposal is technically feasible and commercially viable, it will be implemented.
Where refrigerant is required, that with the lowest GWP is being specified.
The installation of EV charging points on Ark campuses. At present there are four EV chargers at Spring Park, two EV chargers at Cody Park and four EV chargers at Meridian Park. Each campus has plans to install EV chargers to 20% of the car parking spaces, as the additional chargers are rolled out the impact on employee commuting and business travel will be monitored. To date an additional 12 EV chargers have been installed at Spring Park and 26 EV chargers have been installed at Cody Park.
Developing our Carbon Offset Strategy.
Transparently reporting our annual progress towards Carbon Net Zero in line with GHG Protocols and SECR requirements.
select suitable accounting policies and then apply them consistently; state whether applicable United Kingdom Accounting Standards, comprising FRS102, have been followed, subject to any material departures disclosed and explained in the financial statements; 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.
so far as the director is aware, there is no relevant audit information of which the company's auditors are unaware; and
they have taken all the steps that they ought to have taken as a director in order to make themselves aware of any relevant audit information and to establish that the company's auditors are aware of that information.
give a true and fair view of the state of the company’s affairs as at 30 June 2023 and of its loss and cash flows for the year then ended; have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards, including FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland”, and applicable law); and have been prepared in accordance with the requirements of the Companies Act 2006.
Basis for opinion
Conclusions relating to going concern
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.
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.
However, because not all future events or conditions can be predicted, this conclusion is not a guarantee as to the company's ability to continue as a going concern.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
Reporting on other information
Strategic report and Directors' Report
In our opinion, based on the work undertaken in the course of the audit, the information given in the Strategic report and Directors' Report for the year ended 30 June 2023 is consistent with the financial statements and has been prepared in accordance with applicable legal requirements.
In light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we did not identify any material misstatements in the Strategic report and Directors' Report.
Responsibilities for the financial statements and the audit
Responsibilities of the directors for the financial statements
As explained more fully in the Statement of directors' responsibilities, the directors are responsible for the preparation of the financial statements in accordance with the applicable framework and for being satisfied that they give a true and fair view. The directors are also responsible for such internal control as they determine is 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 an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
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.
Based on our understanding of the company and industry, we considered the principal risks of non-compliance with laws and regulations, including those that have a direct impact on the preparation of the financial statements such as the Companies Act 2006, and the extent to which non-compliance might have a material effect on the financial statements. We evaluated management's incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls) and determined that the principal risks were related to posting inappropriate journal entries to increase revenue. Audit procedures performed by the engagement team included:
enquiring with the management of the company and the directors as to any actual or suspected instances of fraud or non-compliance with laws and regulations;
checking the minutes of meetings of the board of directors for matters relevant to the audit;
testing the disclosures made in the financial statements, as well as in the Directors' report, for compliance with the requirements of the Companies Act 2006;
performing audit procedures to incorporate unpredictability around the nature, timing and extent of our testing;
identifying and testing journal entries considered to be of higher fraud risk; and
evaluating the business rationale for any significant or unusual transactions identified as being outside the normal course of business.
There are inherent limitations in the audit procedures described above. We are less likely to become aware of instances of non-compliance with laws and regulations that are not closely related to events and transactions reflected in the financial statements. Also, 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 or intentional misrepresentations, or through collusion.
A further description of our responsibilities for the audit of the financial statements is located on the FRC’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditors’ report.
Use of this report
This report, including the opinions, has been prepared for and only for the company’s members as a body in accordance with Chapter 3 of Part 16 of the Companies Act 2006 and for no other purpose. We do not, in giving these opinions, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior consent in writing.
Other required reporting
Companies Act 2006 exception reporting
Under the Companies Act 2006 we are required to report to you if, in our opinion:
we have not obtained all the information and explanations we require for our audit; or
adequate accounting records have not been kept by the company, or returns adequate for our audit have not been received from branches not visited by us; or
certain disclosures of directors’ remuneration specified by law are not made; or
the financial statements are not in agreement with the accounting records and returns.
We have no exceptions to report arising from this responsibility.
The notes on pages 17 to 30 form part of these financial statements.
The notes on pages 17 to 30 form part of these financial statements.
The notes on pages 17 to 30 form part of these financial statements.
The notes on pages 17 to 30 form part of these financial statements.
Ark Data Centres Limited is a private company limited by shares incorporated in England and Wales. The registered office is Spring Park, Westwells Road, Hawthorn, Corsham, Wiltshire, SN13 9GB.
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 £.
Cost of sales
Cost of sales includes two distinctive elements, namely:
costs directly attributable to the maintenance, security, operation and fit out of the data centres at Spring Park, Cody Park and Meridian Park
operating lease charges payable to the related undertakings who own the underlying campuses and data centres operated by the Company
All costs are recognised in the period to which they relate, exclusive of VAT.
Where factors, such as technological advancement or changes in market price, indicate that residual value or useful life have changed, the residual value, useful life or amortisation rate are amended prospectively to reflect the new circumstances. The assets are reviewed for impairment if the above factors indicate that the carrying amount may be impaired. Costs associated with maintaining computer software are recognised as an expense as incurred. Development costs that are directly attributable to the design and testing of identifiable and unique software products controlled by the company are recognised as intangible assets when the following criteria are met:
It is technically feasible to complete the software so that it will be available for use.
Management intends to complete the software and use or sell it.
There is an ability to use or sell the software.
It can be demonstrated how the software will generate probable future economic benefits.
Adequate technical, financial and other resources to complete the development and to use or sell the software are available.
The expenditure attributable to the software during its development can be reliably measured.
Other development expenditures that do not meet these criteria are recognised as an expense as incurred. Development costs previously recognised as an expense are not recognised as an asset in a subsequent period.
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
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 assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
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 and loans from fellow group companies, 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.
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
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.
Investment income
Income from the company's investments in limited companies is included in the statement of comprehensive income when, and to the extent that, dividends have been declared and are payable and are included in debtors until they are received.
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.
No material judgements, estimates or assumptions have been made in the application of the company's accounting policies for the year ended 30 June 2023. As disclosed in Note 12 to the financial statements, impairment provisions have been made in relation to intangible assets and investment in subsidiaries.
The total turnover of the company for the year has been derived from its principal activity wholly undertaken in the United Kingdom.
The average monthly number of persons (including directors) employed by the company during the year was:
Their aggregate remuneration comprised:
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 2 (2022 - 2).
During the year a provision of £2,552,855 (2022: £3,199,964) was made against amounts owed by a customer who has gone into liquidation and costs of £1,890,399 (2022: £17,428) were incurred in connection with the potential sale of part of the Ark group which didn't come to fruition.
The actual charge for the year can be reconciled to the expected credit for the year based on the profit or loss and the standard rate of tax as follows:
No deferred tax has been recognised at either 30 June 2023 or 30 June 2022 in relation to carried forward losses or capital allowances. This is due to the uncertainty and judgement associated with both the estimation of the financial value, as well as uncertainty around the timing of when such assets would be utilised.
Impairment tests have been carried out where appropriate and the following impairment losses have been recognised in profit or loss:
The directors believe that the carrying value of the investments is supported by the underlying assets.
The Company holds 74.9% of the issued share capital of Crown Hosting Data Centres Limited, a company incorporated in England and Wales with the principal activity of the sale of data centre space and the provision of related services. The joint venture is managed jointly through management boards on which other joint venture partners are represented in accordance with their respective interests held in the joint venture.
Ark Data Spring Park Limited, which was a fully-owned subsidiary of the Company, was placed into voluntary liquidation on 13 April 2022 and was dissolved on 7 February 2023.
Amounts owed by related undertakings are unsecured, have no fixed date of repayment and are repayable on demand. Interest is charged at 5% (2022: 5%) per annum (see note 8).
Amounts owed to related undertakings are owed to subsidiaries of Ark Capital Partners I LP Inc., the ultimate parent of the Company. The amounts are unsecured, interest free, have no fixed date of repayment and are repayable on demand
The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.
At the year end, contributions of £Nil (2022: £Nil) were outstanding.
The assets leased by the Company from related undertakings have been pledged as security against a bank loan held by Ark Estates Holdings Limited, a related undertaking also controlled by Ark Capital Partners I LP Inc. For full details of the bank loan, please refer to the financial statements of Ark Estates Holdings Limited available at Companies House.
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
At the reporting end date the company had contracted with tenants for the following minimum lease payments:
There have been no post balance sheet events requiring disclosure in the notes to the financial statements.
At the year end the company was owed £48,137 (2022: £48,137) by a director. No interest is charged on this loan.
Three are no other related party transactions requiring disclosure other than those disclosed in notes 3,7, 8, 17 and 18 to the financial statements.
The immediate parent undertaking is Ark Group Limited, a company registered in the Isle of Man, and the ultimate parent undertaking is Ark Capital Partners I LP Inc., a limited partnership registered in the Isle of Man. The limited partnership is controlled by its partners.
Ark Group Limited is the parent undertaking of the smallest group of undertakings to consolidate these financial statements at 30 June 2023. The consolidated financial statements of Ark Group Limited are available from its registered office at First Names House, Victoria Road, Douglas, Isle of Man, IM2 4DF.
Ark Capital Partners I LP Inc. is the parent undertaking of the largest group of undertakings to consolidate these financial statements at 30 June 2023. The consolidated financial statements of Ark Capital Partners I LP Inc. are available from its general partner Goshawk GP Limited, First Names House, Victoria Road, Douglas, Isle of Man, IM2 4DF.