The directors present the strategic report for the year ended 30 June 2023.
Principal activities
The principal activity of Saracens Limited (‘the Company’) are those of a professional rugby union football club including entertainment, ticket sales, hospitality, and merchandise. Saracens Limited is part of the wider Saracens Group (‘Group’), the parent company being Saracens Group Holdings Limited. The Group also includes: Saracens Copthall LLP which holds the stadium assets and business; MBN Events Group Limited (formerly known as Premier Team Promotions Limited) which stages entertainment and business events; and an investment in Saracens Mavericks Limited who are part of the Netball Super League. Additionally, affiliated to the Group are The Saracens Foundation which is the club’s charitable arm and the Saracens Multi-Academy Trust which operates the Saracens High School.
We assess progress towards our long-term goals with a series of KPI’s, which in this reported year focused on:
Safeguarding our people first, caring, high-performance culture
Retention of our key people and continuity
Managing cash flow and meeting our financial targets
Achieving entertaining, high sports performance
Remaining at the forefront of women’s sport
Commitment to the community and having a substantial socio-economic impact
Growing our audience
Saracens Ltd financial performance
Revenues (excluding amortisation) increased by £2.6m to £20.9m in year ended June 2023. We saw increased revenues across many of our commercial activities, the largest increases included: £0.9m increase in Sponsorship revenues, £0.5m increase in seasonal membership sales (we sold 241 more memberships), and a £0.3m increase in Showdown revenues. Central income from Premiership Rugby Ltd (PRL) and the RFU also increased by £0.8m.
Operating losses (before depreciation, amortisation, finance costs, intercompany rents, and other income) reduced by £2.1m to £6.4m in year ended June 2023. Effective cost management meant that much of the revenue increase flowed through to operating levels despite many increasing operating costs due to general inflation, especially utility costs.
The Company made a net loss of £5.3m in the year. The net loss is less representative of the performance of the underlying operations as it includes rents payable to another Group entity, one off other income in respect of historic R&D tax credit claims that is not repeatable at the levels seen in 2022, and CVC amortisation which is the spreading of income received in March 2019 related to the sale of shares in Premiership Rugby Ltd to CVC.
The Balance Sheet shows £6.4m of net liabilities as of 30 June 2023. When interpreting the Balance Sheet, it should be understood:
StoneX Stadium is not included in this Balance Sheet as it is held in another Group entity, Saracens Copthall LLP, and that entity has £12.9m of positive net assets.
There is an intercompany liability of £12.4m with Saracens Group Holdings Ltd, the parent company. We are working on capitalising this intercompany loan which will improve the Balance Sheet by £12.4m. The adjusted position excluding the intercompany loan is positive net asset position of £6m.
There is a total deferred income liability of £5.6m, £3.3m of which is monies received relating to the 2023/24 season, not a liability in the traditional sense, and the liability will be released once matches in the 2023/24 season are played. There is a further £0.7m that relates to monies received relating to the 2024/25 season for multi season seasonal memberships and £1.4m also relates to Partnership revenue invoiced in advance of the 2023/24 season, to be released in the next financial year.
There is a deferred tax liability of £3.1m which is not payable to HMRC. It is a provision for taxes on the revaluation of shares in Premiership Rugby Ltd. The taxes would only ever become payable if these shares were sold by the Company and at the value held in the Balance Sheet.
The only third-party debt is with the Department of Culture, Media and Sports (DCMS) and as of the Balance Sheet date the outstanding loan and accrued interest totalled £7.1m. All payments to the DCMS are fully up to date.
2022/2023 season overview
From a Saracens Men’s perspective, it was a very proud moment for everyone at the club and all our fans to be crowned as Premiership Champions for the 6th time and to be back at the top of English rugby. It has been quite some journey over the past few seasons and the club is in a brilliant position to push forward both on and off the pitch. We must also mention the 13 players we supplied to the men’s Rugby World Cup 2023 in France; 7 of which were to the England team. It will always be our ambition to see our players reach their potential and help them develop as the best possible athletes they can be and best possible people.
Our Saracens Women’s Rugby team continue to be at the forefront of elite female sport. This year, we have seen record crowds; successfully tendered to be part of the Premiership Women’s Rugby League professionalisation plans; aligned the support of our female athletes with their male counterparts and generated more ticket revenue than ever before.
On the pitch, our women’s rugby players continue to demonstrate their incredible ability and work-rate. This year, they earnt a place in the Allianz Premier-15s semi-finals having secured third position in the league table. It was a tough start to the season with an incredible 17 Saracens players at the women’s Rugby World Cup in New Zealand (8 Saracens players representing the Red Roses). This meant that our semi-final was away from home at Sandy Park against a strong Exeter Chiefs Women’s team. Despite a heroic performance on the road, Saracens Women were denied a spot in the final in the cruellest way possible, as Exeter scored a last-minute try to take a narrow victory. Whilst a spot in the final evaded Saracens Women this year, the squad can take great heart from their fantastic performances through the season and the development across the team.
Saracens Foundation & ESG
The Saracens Foundation continued to make life changing impacts on the health, education, and employability of local people. The charity had a measurable impact on over 15,500 local people in 2022/23, with over 62,000 secondary impacts on the wellbeing of family and friends of beneficiaries. The charity invested over £1.3m in over 30 projects across North London, Hertfordshire, and Essex, working with people aged 4 to 106.
The Foundation continues to adapt projects to the greatest challenges and needs of local communities and people so that it can make the biggest difference. This season, the charity created a project called ‘Sporting Roots’. The aim of this new project is to provide refugees and asylum seekers with the opportunity to participate in sport to enable them to integrate into their local community. The programme supports these at risk and often marginalised groups to become healthier and reduce social isolation. In addition, the charity created a falls prevention programme in five local care homes called ‘Love to Balance’. This programme supported older adults to build friendships within the care home and live more independent and active lives while living in care. The programme consists of chair-based strength and balance exercises which aim to enable these older adults to gain confidence and improve their physical wellbeing and mental health.
As I write this, the Saracens Foundation are on track to achieve the target of investing £1.8m into projects supporting our local communities in the 23/24 season. This represents a growth of 38% year-on-year. They are also on target to impact the lives of over 90,000 people, providing an improvement in their health, education, or employment.
Saracens Group have also made progress in the 22/23 season on our aim to become the most socially conscious sports and entertainment company. The Group have been working on our Saracens in Seven strategy, which is our aim to be carbon net zero by 2030; zero waste to landfill and 75% waste recycled by 2030 and to boost biodiversity across our stadium by 2030. Towards the end of the season, we have been collecting data to support us in creating a rigorous footprint of our carbon emissions. We have recently received this baseline data, which shows that our group carbon footprint is 11,575TCO2E which is encouraging. The Saracens Group will now be working on a carbon reduction plan to achieve our ambition of being carbon net zero by 2030.
The Directors consider that the principal risks to the Group are any further changes to the Premiership competition structure, inflation and rising interest rates negatively impacting ticket, hospitality and events sales.
Governance
One of our board goals is to maintain leading governance processes. These include risk management, ensuring no breaches in regulatory requirements, optimised business processes and systems, regular meetings of the risk and audit committee, having a clear vision and three year financial plan refreshed. I am pleased to say this board goal was met. Our Audit and Risk Committee as well as our Salary Cap Committee meet quarterly and are now well established.
The Board and shareholders continue to have a deep commitment to diversity, community, and sustainability. Furthermore, we will continue to maximise Saracens socio-economic impact, caring for our people and community, as well as maintain the stadium’s sector leading environmental standards.
On behalf of the board
The directors present their annual report and financial statements for the year ended 30 June 2023.
The results for the year are set out on page 11.
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:
We forecast continued commercial growth in 2023/24: primarily in Showdown sales and match by match revenues. This is to be accompanied by careful cost management. In 2024/25 we expect to see an improvement in central income from the RFU under a new Professional Game Agreement and further commercial growth.
Moore Kingston Smith LLP have signified their willingness to continue in office as the Auditors.
The financial statements have been prepared on a going concern basis.
As in previous years, the company met its working capital needs through funds provided from the parent Saracens Group Holdings Limited and continues to do so going forward until becoming profitable. As at 30 June 2023, Saracens Group Holdings Limited itself had net liabilities of £5m (2022: net assets of £1.6m) primarily due to the structure of injected funds being loan notes which are expected to convert. Furthermore we fully expect the injection of additional funds in line with the £32m Investor Agreement completed in February 2022 by new investors, Kimono House Limited and Euroblue Investments Limited, to facilitate the operations of the company over twelve months from the date of the approval of the financial statements. As at December 2023, £3.3m of funds remain available under the February 2022 Investment Agreement.
In addition, the owners of Saracens Group Holdings Limited (Kimono House Limited and Euroblue Investments Limited) have confirmed their willingness to continue lending to Saracens Group Holdings Limited through the signing of a loan note agreement for an additional £7 million of funding. This will facilitate the continued operations of the company over twelve months from the date of the approval of the accounts to meet the cash requirements as outlined in its business plan.
The business plan assumes the continued levels of crowd attendances but were this assumption not to be valid then the directors have contingency plans to reduce the impact on cash flow. Whilst there is some uncertainty over the future structure of the Premiership and there is a challenging general economic environment, both of which could impact the incoming cash flows for the group, the directors are not aware of any other events or conditions beyond the period of their assessment that may cast significant doubt on the entity’s ability to continue as a going concern.
Basis for 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
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit:
the information given in the Strategic Report and the Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.
As explained more fully in the Directors' Responsibilities Statement, 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 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.
The objectives of our audit in respect of fraud, are; to identify and assess the risks of material misstatement of the financial statements due to fraud; to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud, through designing and implementing appropriate responses to those assessed risks; and to respond appropriately to instances of fraud or suspected fraud identified during the audit. However, the primary responsibility for the prevention and detection of fraud rests with both management and those charged with governance of the company.
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.
As part of an audit in accordance with ISAs (UK) we exercise professional judgement and maintain professional scepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purposes of expressing an opinion on the effectiveness of the company’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors.
Conclude on the appropriateness of the directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the company to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
Explanation as to what extent the audit was considered capable of detecting irregularities, including fraud
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.
The objectives of our audit in respect of fraud, are; to identify and assess the risks of material misstatement of the financial statements due to fraud; to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud, through designing and implementing appropriate responses to those assessed risks; and to respond appropriately to instances of fraud or suspected fraud identified during the audit. However, the primary responsibility for the prevention and detection of fraud rests with both management and those charged with governance of the company.
Our approach was as follows:
We obtained an understanding of the legal and regulatory requirements applicable to the company including the Companies Act 2006, taxation legislation, data protection, anti-bribery, employment, environmental, fire safety, Licensing Act 2003 and health and safety legislation
We obtained an understanding of how the company complies with these requirements by discussions with management and those charged with governance.
We assessed the risk of material misstatement of the financial statements, including the risk of material misstatement due to fraud and how it might occur, by holding discussions with management and those charged with governance.
We inquired of management and those charged with governance as to any known instances of non-compliance or suspected non-compliance with laws and regulations.
Based on this understanding, we designed specific appropriate audit procedures to identify instances of non-compliance with laws and regulations. This included making enquiries of management and those charged with governance and obtaining additional corroborative evidence as required.
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.
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 an auditor's report 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.
Saracens Limited is a private company limited by shares incorporated in England and Wales. The registered office is StoneX Stadium, Greenlands Lane, Hendon, United Kingdom, NW4 1RL.
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 £.
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 33 ‘Related Party Disclosures’: Compensation for key management personnel.
The financial statements of the company are consolidated in the financial statements of Saracens Group Holdings Limited. These consolidated financial statements are available from its registered office, StoneX Stadium, Greenlands Lane, Hendon, London, NW4 1RL.
Notwithstanding net current liabilities of £16.6m as at 30 June 2023 (2022: £11.8m) and a loss for the year then ended of £5.3m (2022: £4.9m) the financial statements have been prepared on a going concern basis which the directors consider to be appropriate for the following reasons:
As in previous years, the company met its working capital needs through funds provided from the parent Saracens Group Holdings Limited and continues to do so going forward until becoming profitable. As at 30 June 2023, Saracens Group Holdings Limited itself had net liabilities of £5m (2022: net assets of £1.6m) primarily due to the structure of injected funds being loan notes which are expected to convert. Furthermore we fully expect the injection of additional funds in line with the £32m Investor Agreement completed in February 2022 by new investors, Kimono House Limited and Euroblue Investments Limited, to facilitate the operations of the company over twelve months from the date of the approval of the financial statements. As at December 2023, £3.3m of funds remain available under the February 2022 Investment Agreement.
In addition, the owners of Saracens Group Holdings Limited (Kimono House Limited and Euroblue Investments Limited) have confirmed their willingness to continue lending to Saracens Group Holdings Limited to facilitate the continued operations of the company over twelve months from the date of the approval of the accounts to meet the cash requirements as outlined in its business plan.
The business plan assumes the continued levels of crowd attendances but were this assumption not to be valid then the directors have contingency plans to reduce the impact on cash flow. Whilst there is some uncertainty over the future structure of the Premiership and there is a challenging general economic environment, both of which could impact the incoming cash flows for the group, the directors are not aware of any other events or conditions beyond the period of their assessment that may cast significant doubt on the entity’s ability to continue as a going concern.
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.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
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.
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
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, 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.
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.
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.
The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.
In categorising leases as finance leases or operating leases, management makes judgements as to whether the significant risks and rewards of ownership have transferred to the company as a lessee, or to the lessee where the company is a lessor.
The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.
The recoverable amount of the deferred tax asset is based on estimates of taxable profits in the foreseeable future. As such, the carrying value of the deferred tax asset is determined to be £nil. Further details are given in note 19 to the financial statements.
The company holds an investment in 'P' shares in Premier Rugby Limited entitling the holder to future income streams. The investment in Premier Rugby Limited is held at the most recent valuation provided by Premier Rugby Limited and in accordance with other clubs in the league as described in note 12. The last valuation was completed in 2019 and was based on the external investment received. Each year the valuation is reviewed by the directors using a discounted cash flow model based on the anticipated income streams over the coming years. This is then compared to the current valuation in the accounts and where large differences have arisen, the directors would process an adjustment.
An agreement to sell a significant minority interest in Premiership Rugby Limited (PRL) to certain funds advised or managed by CVC Capital Partners (CVC Funds) was signed on 29 March 2019 and the club received a cash inflow of £12.8m as a result of this transaction. This income is being recognised in profit or loss over 48 months which is in line with the other major commercial contracts entered into by PRL, with amounts relating to future periods being recognised as deferred income, and this has been reflected in note 15. This amount was fully released in the year ended 30 June 2023.
The average monthly number of persons (excluding directors) employed by the company during the year was:
Their aggregate remuneration comprised:
The actual charge/(credit) 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:
The company has tax losses of approximately £97 million (2022: £92 million) to use in future years (after considering the offset against the revaluation gains as detailed in note 19). The deferred tax asset measured at 25% (2022: 25%) has not been recognised except for below. On the basis of available evidence, it is more likely than not that there will be no taxable profits in the foreseeable future against which the asset can be recovered.
Amortisation of intangible fixed assets is included within net operating expenses in the statement of comprehensive income.
£17,551,780 (2022: £17,551,780) of the above unlisted investments relates to an investment in Premiership Rugby Limited ("PRL").
In line with other shareholding clubs, the Company holds this investment at the most recent valuation provided by PRL which is based on the income stream into perpetuity, discounted at a rate of 8%. There is a fixed charge registered in relation to these shares.
The company also holds, along with the CVC funds, an additional minority shareholding in PRL of £2,133,007 (2022: £2,133,007). The investment is held at its fair market value, which is considered to be £2,133,007 (2022: £2,133,007).
Included in the above deferred income balance is an amount of £nil (2022: £2,349,832) that relates to the CVC deal signed on 29 March 2019 where the club received a cash inflow of £12.8m and this is being recognised over 48 months.
Other loans amount relates to a DCMS loan under the government scheme, which attracts interest of 2% per annum. The first repayment date is 30 September 2024.
The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:
The above deferred tax liability is not expected to reverse within 12 months of the reporting date. The deferred tax liability is a provision which would only become payable if the company was to sell its unlisted investment, which is currently held at £17,551,780, in Premier Rugby Limited. Given this investment is intrinsically linked to the existence of the Premiership league, this liability is extremely unlikely to become payable.
Unrecognised deferred tax assets, to the extent that they cannot be offset against the unlisted investment noted above, are shown in note 9 to the financial statements.
The company operates a defined contribution pension scheme. The assets of the scheme are held separately from those of the company in an independently administered fund. Contributions totalling £81,320 (2022: £44,948) were payable to the fund at the year end and are included in creditors.
Each ordinary share entitles the holder to one vote at general meetings. The deferred shares shall rank pari passu with the ordinary shares of 1p each in the capital of the company in respect of dividends and on a return of capital (whether in a winding up or otherwise), save that all of the holders of the deferred shares shall, in aggregate, be entitled to payment of 1p on any dividend and 1p on a return of capital. The deferred shares shall not entitle the holders thereof to receive notice or attend or vote at any general meetings of the company, shall not be redeemable, and shall not be capable of transfer at any time hereafter other than as provided with the consent of the directors of the company.
The special share may only be held or transferred to the amateur club, Saracens Amateur RFC, providing certain rights relating to the name and activities of the club. It confers no voting rights on the holder of the special share.
A HMRC enquiry into prior year R&D claims remains open at the date of approval of the financial statements. The directors are complying with HMRC's checks and are using professional advisors as appropriate. The directors' best estimate of any potential reduction to the R&D claims has been included in the financial statements.
The profit and loss account represents cumulative profit and loss net of distribution to owners, and the fair value reserve previously shown separately. This reflects the treatment of fair value gains and losses on investments under FRS 102 which requires such gains and losses to be shown in profit or loss. As the gains or losses relate to unlisted investments, they are not distributable until the gains or losses are realised on disposal.
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:
£29,238,356 (2022: £5,000,000) of the above operating lease commitments are to a related group undertaking.
The immediate parent company is Saracens Group Holdings Limited, a company incorporated in the UK and is the parent of the largest and smallest group for which consolidated accounts are prepared. The registered office of Saracens Group Holdings Limited is StoneX Stadium, Greenlands Lane, Hendon, London, NW4 1RL.
The ultimate parent company is Kimono House Limited, a company incorporated in the UK.
During the year the company entered into the following transactions with related parties:
The following amounts were outstanding at the reporting end date:
The following amounts were outstanding at the reporting end date:
The amounts owed to/from other related parties which are under common control with the company, or have directors in common, are interest free and have no fixed repayment date.
Saracens Mavericks Limited is a subsidiary (2022: joint venture) of Saracens Group Holdings Limited, the parent company. Saracens Copthall LLP is a related entity due to the direct ownership by Saracens Group Holdings Limited.
One of the directors salary is recharged from MBN Events Group Limited. The total for 2023 was £255,774.
As disclosed in note 4 of the 2019 financial statements, employee remuneration and other costs associated with the salary cap and tax matters at the time, funded directly by a shareholder were not included in the 2019 and the 2020 year-end financial statements. As these costs were directly offset by a capital contribution from the shareholder, there is no adjustment to the opening profit and loss reserve position of the company.