Ryecourt Limited - Limited company accounts 23.2

REGISTERED NUMBER: 04120697 (England and Wales)

GROUP STRATEGIC REPORT, REPORT OF THE DIRECTORS AND

CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MAY 2023

FOR

RYECOURT LIMITED

Page

Company Information

1

Group Strategic Report

2

Report of the Directors

4

Report of the Independent Auditors

6

Consolidated Income Statement

10

Consolidated Other Comprehensive Income

11

Consolidated Balance Sheet

12

Company Balance Sheet

13

Consolidated Statement of Changes in Equity

14

Company Statement of Changes in Equity

15

Consolidated Cash Flow Statement

16

Notes to the Consolidated Cash Flow Statement

17

Notes to the Consolidated Financial Statements

18

DIRECTORS:

Mr D Bell

Mrs L Symms

Mrs B C Bell

SECRETARY:

Mrs B C Bell

REGISTERED OFFICE:

17 St Peters Place

Fleetwood

Lancashire

FY7 6EB

REGISTERED NUMBER:

04120697 (England and Wales)

AUDITORS:

Jones Harris Limited

Statutory Auditors

17 St Peters Place

Fleetwood

Lancashire

FY7 6EB

The directors present their strategic report of the company and the group for the year ended 31 May 2023.

REVIEW OF BUSINESS

The group's performance is a combination of the performance of the parent company, Ryecourt Limited and it's trading subsidiaries, Belsfield Care Limited, K & B Property Limited and T & S Healthcare Limited. Both Ryecourt Limited and Belsfield Care Limited operate care homes in the north west of England. T & S Healthcare Limited provide healthcare products to the care and nursing home industry whilst K & B Property Limited are involved in the construction industry.

Key Performance Indicators:

2023

2022

£

£

Turnover

16,818,565

14,658,547

Group operating profit

5,401,248

5,440,145

Profit before taxation

5,619,969

5,418,738

Profit after taxation

4,511,055

4,383,863

Shareholders funds

15,604,980

11,418,925

Care Homes

Turnover has continued to show impressive growth year on year. The care homes within the group continue to offer a high standard of care to all its residents including those with complex needs.

The average occupancy rates across the 3 homes is 99.5% which is far greater than the North West average of around 87% which shows the focus that management have put it in to deliver high quality services. Due to the high reputation that the company has within the care sector, local councils and Primary Care Trusts are eager to place their patients in these homes.

The resident to staff ratio this year is 0.42 resident to each full time member of staff which means for every resident the homes have over 2 members of staff. This figure is much lower than the national average of 0.80 which equates to just over 1 member of staff. This gives an indication of the higher standard of care that the company gives to its residents.

Others

T&S Healthcare Limited has continued to foster relationships with its supply chain and has seen its turnover increase by 27%

PRINCIPAL RISKS AND UNCERTAINTIES

Financial risks

The group's activities expose it to a number of financial risks.

Credit risk

The group's principal financial assets are bank balances, trade and other receivables.

The group's credit risk is primarily attributable to its trade receivables. The amounts presented in the balance sheet are net of allowances for doubtful receivables. However, the majority of the residents within the home, are placed by the council and care trusts with a history of minimal doubtful debts.

The credit risk on liquid funds is limited because the counterparties are banks with high credit-ratings assigned by international credit-rating agencies.

Liquidity risk and Cash flow risk

To manage liquidity and cash flow risk, the group closely monitors its operating cash flows to ensure that there are sufficient funds to meet not only its day to day working capital commitments but any future capital commitments that may fall due.

Operational risks

The group's activities expose it to a number of operational risks including reputational risk and regulatory risk.

Reputational risks

The group strives to give the best possible standard of care to each and every resident, no matter whether they be short term, long term, respite nursing or residential care. Any serious incident relating to the provision of this care could lead to negative publicity and increased scrutiny from regulators and the public. In order to mitigate this, the group welcomes independent inspectors such as the CQC, delivers regular training to its staff in order to maintain their high standards and carries out DBS checks on all care home staff.

Regulatory risks

The care home sector is a highly regulated industry and the group is subject to a number of inspections from various agencies, the majority of which, are unannounced. Any failure to meet the necessary regulations could lead to the homes being placed in special measures or even closed.

In order to mitigate these risks the group has a designated compliance team who regularly monitor the practices of the company to ensure that they meet with the regulators standards.

Macro-economic risks

Brexit

When combined with the impact of Covid, most industries have experienced labour shortages. Encouragingly, at the end of 2021 the Government announced that care workers would be added to the Shortage Occupation List.

Interest & Inflation

The UK is currently in the midst of a period of high inflation and interest rates. As a group, we have no borrowings from financial institutions so our exposure to interest rate risk is zero. The high rates of inflation have caused pressures on staff costs along with food and utilities. However, we are well placed to absorb these costs

ON BEHALF OF THE BOARD:

Mr D Bell - Director

28 February 2024

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

DIVIDENDS

No interim dividends were paid during the year on any of the shares.

The directors recommend a final dividend per share as follows:

D Ordinary £1

- £17500

E Ordinary £1

- £15000

The total distribution of dividends for the year ended 31 May 2023 will be £ 325,000 .

FUTURE DEVELOPMENTS

The company now has planning permission for a 40 bed nursing home on land owned by the company. The directors have not yet decided whether to go ahead with the construction.

DIRECTORS

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

Mr D Bell

Mrs L Symms

Mrs B C Bell

ENGAGEMENT WITH EMPLOYEES

Open communication with our employees is of utmost importance to us and our staff are kept informed of the company's activities through regular meetings with staff representatives which are undertaken every month. Employees are given the opportunity to relay their ideas to us through their representative or via their staff appraisals. We are very "hands on" and always maintain a presence within the homes and our employees are welcome to approach us directly with any ideas or comments they may have. These meetings enable us to achieve a common awareness with our employees of the financial and economic factors affecting the performance of the company.

We are committed to giving our employees a safe and positive working environment, with our staff's mental and physical wellbeing at the forefront. We offer a range of benefits to encourage employees to involve themselves in the company performance including company sick pay, enhanced maternity pay, free meals and career support. There is a definitive career progression for any of our employees, along with increases in pay. Pay is also reviewed annually and our staff have received a number of parishes recently, to help with the pressures of Covid-19. All of our staff are automatically enrolled into our work place pension scheme. We have invested heavily in Personal Protective Equipment for all of our staff, to ensure that they remain as safe as possible during the Covid-19 pandemic, so that they can continue to deliver the standard of care that our residents have become accustomed to. We would never undertake any principal decisions that would exert undue pressure on our employees as our employees wellbeing is always taken into consideration.

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The directors are responsible for preparing the Group 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 the group and of the profit or loss of the group 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 and the group's transactions and disclose with reasonable accuracy at any time the financial position of the company and the group 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 the group 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 group'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 group's auditors are aware of that information.

AUDITORS

The auditors, Jones Harris Limited, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

Mr D Bell - Director

28 February 2024

Opinion

We have audited the financial statements of Ryecourt Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 May 2023 which comprise the Consolidated Income Statement, Consolidated Other Comprehensive Income, Consolidated Balance Sheet, Company Balance Sheet, Consolidated Statement of Changes in Equity, Company Statement of Changes in Equity, Consolidated Cash Flow Statement and Notes to the Consolidated Cash Flow Statement, Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

-	give a true and fair view of the state of the group's and of the parent company affairs as at 31 May 2023 and of the group's profit for the year then ended;

-	have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

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

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the group 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 group's and the parent 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 Group 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 Group 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 Group 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 group and the parent company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group 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 by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or

-	the parent company 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 pages four and five, 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 group's and the parent 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 group or the parent company or to cease operations, or have no realistic alternative but to do so.

Auditors' responsibilities for the audit of the financial statements

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

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

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

-we identified the laws and regulations applicable to the company through discussions with directors and other

management, and from our commercial knowledge and experience of the sector;

-we focused on specific laws and regulations which we considered may have a direct material effect on the financial

statements or the operations of the company, including the Companies Act 2006, taxation legislation and data

protection, anti-bribery, employment, care home legislation and health and safety legislation;

-we assessed the extent of compliance with the laws and regulations identified above through making enquiries of

management and inspecting legal correspondence; and

-identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit

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

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

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

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

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

-tested journal entries to identify unusual transactions; and

-investigated the rationale behind significant or unusual transactions.

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

-agreeing financial statement disclosures to underlying supporting documentation;

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

-reviewing correspondence with HMRC, relevant regulators including the Health and Safety Executive, Care Quality Commission and the company’s legal advisors.

There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.

Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or 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.

Charles Bryning (senior statutory auditor)

for and on behalf of Jones Harris Limited

Statutory Auditors

17 St Peters Place

Fleetwood

Lancashire

FY7 6EB

28 February 2024

TURNOVER

16,818,565

14,658,547

Cost of sales

451,231

415,368

GROSS PROFIT

16,367,334

14,243,179

Administrative expenses

11,061,966

9,147,602

5,305,368

5,095,577

Other operating income

95,880

344,568

OPERATING PROFIT

5

5,401,248

5,440,145

Income from shares in group undertakings

-

4,054,593

Income from fixed asset investments

-

(4,054,593

)

Interest receivable and similar income

233,215

4,081

5,634,463

5,444,226

Interest payable and similar expenses

6

14,494

25,488

PROFIT BEFORE TAXATION

5,619,969

5,418,738

Tax on profit

7

1,108,914

1,034,875

PROFIT FOR THE FINANCIAL YEAR

4,511,055

4,383,863

Profit attributable to:

Owners of the parent

4,511,055

4,383,863

PROFIT FOR THE YEAR

4,511,055

4,383,863

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

4,511,055

4,383,863

Total comprehensive income attributable to:

Owners of the parent

4,511,055

4,383,863

FIXED ASSETS

Tangible assets

10

4,346,816

3,828,028

Investments

11

-

-

Investment property

12

363,483

363,483

4,710,299

4,191,511

CURRENT ASSETS

Stocks

13

14,556

8,631

Debtors

14

1,089,289

366,502

Cash at bank

15,331,240

12,300,201

16,435,085

12,675,334

CREDITORS

Amounts falling due within one year

15

(5,007,087

)

(4,716,475

)

NET CURRENT ASSETS

11,427,998

7,958,859

TOTAL ASSETS LESS CURRENT LIABILITIES

16,138,297

12,150,370

CREDITORS

Amounts falling due after more than one year

16

(362,791

)

(555,073

)

PROVISIONS FOR LIABILITIES

20

(170,526

)

(176,372

)

NET ASSETS

15,604,980

11,418,925

CAPITAL AND RESERVES

Called up share capital

21

1,640

1,640

Retained earnings

15,603,340

11,417,285

SHAREHOLDERS' FUNDS

15,604,980

11,418,925

The financial statements were approved by the Board of Directors and authorised for issue on 28 February 2024 and were signed on its behalf by:

Mr D Bell - Director

FIXED ASSETS

Tangible assets

10

2,528,682

2,270,698

Investments

11

201

201

Investment property

12

363,483

363,483

2,892,366

2,634,382

CURRENT ASSETS

Stocks

13

1,507

1,370

Debtors

14

858,120

191,161

Cash at bank

15,052,335

11,586,193

15,911,962

11,778,724

CREDITORS

Amounts falling due within one year

15

(3,957,822

)

(3,630,114

)

NET CURRENT ASSETS

11,954,140

8,148,610

TOTAL ASSETS LESS CURRENT LIABILITIES

14,846,506

10,782,992

CREDITORS

Amounts falling due after more than one year

16

(362,791

)

(555,073

)

PROVISIONS FOR LIABILITIES

20

(3,824

)

-

NET ASSETS

14,479,891

10,227,919

CAPITAL AND RESERVES

Called up share capital

21

1,540

1,540

Retained earnings

14,478,351

10,226,379

SHAREHOLDERS' FUNDS

14,479,891

10,227,919

Company's profit for the financial year

4,576,972

7,006,245

The financial statements were approved by the Board of Directors and authorised for issue on 28 February 2024 and were signed on its behalf by:

Mr D Bell - Director

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 June 2021

1,640

9,937,155

9,938,795

Changes in equity

Dividends

-

(2,903,733

)

(2,903,733

)

Total comprehensive income

-

4,383,863

4,383,863

Balance at 31 May 2022

1,640

11,417,285

11,418,925

Changes in equity

Dividends

-

(325,000

)

(325,000

)

Total comprehensive income

-

4,511,055

4,511,055

Balance at 31 May 2023

1,640

15,603,340

15,604,980

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 June 2021

1,540

6,123,867

6,125,407

Changes in equity

Dividends

-

(2,903,733

)

(2,903,733

)

Total comprehensive income

-

7,006,245

7,006,245

Balance at 31 May 2022

1,540

10,226,379

10,227,919

Changes in equity

Dividends

-

(325,000

)

(325,000

)

Total comprehensive income

-

4,576,972

4,576,972

Balance at 31 May 2023

1,540

14,478,351

14,479,891

Cash flows from operating activities

Cash generated from operations

1

4,954,744

6,649,439

Interest paid

(9,025

)

(24,940

)

Interest element of hire purchase payments paid

(5,469

)

(548

)

Tax paid

(968,134

)

(1,211,702

)

Net cash from operating activities

3,972,116

5,412,249

Cash flows from investing activities

Purchase of tangible fixed assets

(776,377

)

(196,547

)

Sale of tangible fixed assets

-

15,250

Interest received

233,215

4,081

Net cash from investing activities

(543,162

)

(177,216

)

Cash flows from financing activities

Loan repayments in year

(611,640

)

(892,897

)

Capital repayments in year

70,763

(12,169

)

Amount introduced by directors

1,630,001

4,983,734

Amount withdrawn by directors

(1,162,039

)

(2,372,947

)

Equity dividends paid

(325,000

)

(2,903,733

)

Net cash from financing activities

(397,915

)

(1,198,012

)

Increase in cash and cash equivalents

3,031,039

4,037,021

Cash and cash equivalents at beginning of year

2

12,300,201

8,263,180

Cash and cash equivalents at end of year

2

15,331,240

12,300,201

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

2023

2022

£

£

Profit before taxation

5,619,969

5,418,738

Depreciation charges

257,589

242,618

Profit on disposal of fixed assets

-

(6,083

)

Finance costs

14,494

25,488

Finance income

(233,215

)

(4,081

)

5,658,837

5,676,680

(Increase)/decrease in stocks

(5,925

)

39,129

(Increase)/decrease in trade and other debtors

(722,787

)

860,212

Increase in trade and other creditors

24,619

73,418

Cash generated from operations

4,954,744

6,649,439

2.	CASH AND CASH EQUIVALENTS

The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts:

Year ended 31 May 2023

31/5/23

1/6/22

£

£

Cash and cash equivalents

15,331,240

12,300,201

Year ended 31 May 2022

31/5/22

1/6/21

£

£

Cash and cash equivalents

12,300,201

8,263,180

3.	ANALYSIS OF CHANGES IN NET FUNDS

At 1/6/22

Cash flow

At 31/5/23

£

£

£

Net cash

Cash at bank

12,300,201

3,031,039

15,331,240

12,300,201

3,031,039

15,331,240

Debt

Finance leases

-

(70,763

)

(70,763

)

Debts falling due within 1 year

(56,567

)

56,567

-

Debts falling due after 1 year

(555,073

)

555,073

-

(611,640

)

540,877

(70,763

)

Total

11,688,561

3,571,916

15,260,477