Company registration number 04735372 (England and Wales)
BEADTREK LIMITED
FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2023
PAGES FOR FILING WITH REGISTRAR
BEADTREK LIMITED
CONTENTS
Page
Balance sheet
1
Statement of changes in equity
2
Notes to the financial statements
3 - 9
BEADTREK LIMITED
BALANCE SHEET
- 1 -
2023
2022
Notes
£
£
£
£
Fixed assets
Investment properties
4
64,500,000
68,700,000
Current assets
Debtors
5
1,712,171
1,410,627
Creditors: amounts falling due within one year
6
(4,150,131)
(3,438,105)
Net current liabilities
(2,437,960)
(2,027,478)
Total assets less current liabilities
62,062,040
66,672,522
Creditors: amounts falling due after more than one year
7
(61,262,085)
(61,920,362)
Net assets
799,955
4,752,160
Capital and reserves
Called up share capital
100
100
Fair value reserve
4,958,676
9,158,676
Profit and loss reserves
(4,158,821)
(4,406,616)
Total equity
799,955
4,752,160
The directors of the company have elected not to include a copy of the profit and loss account within the financial statements.true
These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies regime.
The financial statements were approved by the board of directors and authorised for issue on 28 February 2024 and are signed on its behalf by:
N Martin
Director
Company Registration No. 04735372
BEADTREK LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MAY 2023
- 2 -
Share capital
Fair value reserve
Profit and loss reserves
Total
£
£
£
£
Balance at 1 June 2021
100
4,958,676
(4,548,063)
410,713
Year ended 31 May 2022:
Profit and total comprehensive income for the year
-
-
4,341,447
4,341,447
Transfers
-
(4,200,000)
(4,200,000)
Other movements
-
4,200,000
-
4,200,000
Balance at 31 May 2022
100
9,158,676
(4,406,616)
4,752,160
Year ended 31 May 2023:
Loss and total comprehensive income for the year
-
-
(3,952,205)
(3,952,205)
Transfers
-
4,200,000
4,200,000
Other movements
-
(4,200,000)
-
(4,200,000)
Balance at 31 May 2023
100
4,958,676
(4,158,821)
799,955
BEADTREK LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2023
- 3 -
1
Accounting policies
Company information
Beadtrek Limited is a private company limited by shares incorporated in England and Wales. The registered office is 5th Floor Leconfield House, Curzon Street, London, W1J 5JA.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006 as applicable to companies subject to the small companies regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.
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 £.
The financial statements have been prepared under the historical cost convention, modified to include the revaluation of freehold properties and to include investment properties and certain financial instruments at fair value. The principal accounting policies adopted are set out below.
1.2
Going concern
The company's balance sheet shows net assets of £799,955 (2022: £4,752,160). The company has net current liabilities of £2,437,960 (2022: £2,027,478). The company's property investment and funding have been set up to be principally self-funding using the loan structure detailed in note 9. The lease agreement that the company has entered into with its tenant is subject to fixed, stepped increases each month until the end of the lease term. The projected cash flows from these rentals exceed the anticipated cash outflows in respect of loan capital and interest payments.
The Directors have assessed the group's loan and rental structure and has concluded that the group and company has sufficient working capital to enable them to meet their liabilities as they fall due for the foreseeable future. The Directors therefore consider it appropriate to prepare the financial statements on the going concern basis.
Loans owed by the company can be met from rental cashflows received. The directors consider that the company will be able to continue to meet its financial obligations and the accounts have been drawn up on that basis.
1.3
Rent receivable
Rental income from the investment property leased out under an operating lease is recognised in the profit and loss account on an accrual basis over the term of the lease. The effect of rent reviews is only recognised when such reviews have been agreed with tenants. Where rents are subject to fixed indexation in lieu of rent reviews, the rents are recognised on a systematic basis as income in the periods in which they are earned.
1.4
Investment properties
Investment property, which is property held to earn rentals and/or for capital appreciation, is initially recognised at cost, which includes the purchase cost and any directly attributable expenditure. Subsequently it is measured at fair value at the reporting end date. Changes in fair value are recognised in profit or loss.
1.5
Borrowing costs
Loan finance costs are amortised over the term of the related borrowings and the loans to which they relate are stated after deducting the amount of the unamortised finance costs.
BEADTREK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
1
Accounting policies
(Continued)
- 4 -
1.6
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.7
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
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.
Classification of financial liabilities
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
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.
1.8
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
BEADTREK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
1
Accounting policies
(Continued)
- 5 -
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
1.9
Leases
Rental income from operating leases is recognised on a straight line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight line basis over the lease term.
2
Judgements and key sources of estimation uncertainty
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.
Key sources of estimation uncertainty
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.
Valuation of investment property
The key accounting estimate in preparing these financial statements relates to the carrying value of the investment property which is stated at fair value. The company uses reports provided by Chartered Surveyors employed by the group's in house management company as a basis for determining the director's estimation of the fair value of the investment property. However, the valuation of the company's investment property is inherently subjective, as it is made on the basis of valuation assumptions which may in future not prove to be accurate.
Deferred taxation
Deferred tax assets and liabilities are assessed on the basis of assumptions regarding the future, the likelihood that assets will be realised and liabilities will be settled, and estimates as to the timing of those future events and as to the future tax rates that will be applicable.
BEADTREK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
- 6 -
3
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Total
2
1
4
Investment property
2023
£
Fair value
At 1 June 2022
68,700,000
Revaluations
(4,200,000)
At 31 May 2023
64,500,000
The fair value of investment property at yearend was £64,500,000 (2022: £68,700,000). Valuation had taken into account tenure, lease terms, market conditions, inflation assumptions and sales prices based upon known market transactions for similar properties.
The fair value of the investment properties have been arrived at on the basis of a valuation carried out at 31 May 2023 by a qualified chartered surveyor. Annual capitalisation rate method was used for the valuation by reference to market evidence of rates used for properties in similar location.
If investment properties were stated on an historical cost basis rather than a fair value basis, the amounts would have been included as follows:
2023
2022
£
£
Cost
59,541,324
59,541,324
Accumulated depreciation
-
-
Carrying amount
59,541,324
59,541,324
5
Debtors
2023
2022
Amounts falling due within one year:
£
£
Amounts owed by group undertakings
301,544
BEADTREK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
5
Debtors
(Continued)
- 7 -
2023
2022
Amounts falling due after more than one year:
£
£
Deferred tax asset
1,410,627
1,410,627
Total debtors
1,712,171
1,410,627
6
Creditors: amounts falling due within one year
2023
2022
£
£
Other borrowings
8
3,206,371
2,860,162
Amounts owed to group undertakings
190,154
Taxation and social security
91,723
90,793
Other creditors
113,048
112,943
Accruals and deferred income
738,989
184,053
4,150,131
3,438,105
7
Creditors: amounts falling due after more than one year
2023
2022
Notes
£
£
Other borrowings
8
61,262,085
61,920,362
Amounts included above which fall due after five years are as follows:
Payable by instalments
45,026,138
47,058,099
8
Loans and overdrafts
2023
2022
£
£
Loans from group undertakings and related parties
64,468,456
64,780,524
Payable within one year
3,206,371
2,860,162
Payable after one year
61,262,085
61,920,362
BEADTREK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
8
Loans and overdrafts
(Continued)
- 8 -
The loans due to group undertakings consists of three loan balances of £8,725,500, £32,830,492 and £23,232,995 (2022: £9,820,178, £34,472,925 and £20,843,562). Finance charge of £320,527 (2022: £356,141) was allocated to future period as at the year end.
Loan 1 and 2 are repayable by instalments by 2029 and 2032 respectively. The are financed by loans from a third party to the lending group undertaking, which are secured on the company's investment property, and bearing uplifted interest at 5.703% and 6.195% in subsidiaries. The loans are subject to cross guarantees and cross-collateralisation of the underlying properties used as security for loans to other group undertakings. The total value of the group loans subject to cross-collateralisation, including the company's loan, is £201,765,277 (2022: £215,054,673)
Loan 3 is unsecured, and also financed by a loan from a third party to the lending group undertaking. Interest is rolled up into the loan quarterly at 11.01% per annum. This loan, including the rolled up interest, is repayable by lump sum in 2032.
9
Audit report information
As the income statement has been omitted from the filing copy of the financial statements, the following information in relation to the audit report on the statutory financial statements is provided in accordance with s444(5B) of the Companies Act 2006:
The auditor's report was unqualified.
Senior Statutory Auditor:
Grant Lee
Statutory Auditor:
Gerald Edelman LLP
Date of audit report:
28 February 2024
10
Operating lease commitments
Lessor
The company's operating leases represent property leases. The rentals on the property are fixed and the lease expires in June 2032.
At the reporting end date the company had contracted with tenants for the following minimum lease payments:
2023
2022
£
£
52,360,171
57,807,462
BEADTREK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
- 9 -
11
Related party transactions
The company is related to other companies which are owned by trusts of which the director or his family are beneficiaries. During the year, and included within administrative expenses, £1,650 (2022 £2,680) was charged as a management fee by Rotch Property Group Limited and management fees of £6,000 (2022 £6,000) were charged by MLV Estates and Management Limited. Included within accruals and deferred income is a balance of £9,690 (2022 £8,040) due to Rotch Property Group Limited. A balance of £3,500 (2022 £3,500) was due to Dellweald Limited. This balance is included within other creditors. No interest accrues on this balance.
At the balance sheet date £850 (2022: £850) was due to the Tchenguiz Discretionary Trust, the companies ultimate controlling party. The company is also related to other companies controlled by the Tchenguiz Discretionary Trust. At the balance sheet date £108,594 (2022: £108,594) was due to one such company, R20 Limited in relation to the settling of related party balances. Both balances are included within other creditors. No interest accrues on these balances.
The company has taken advantage of the exemptions provided by Section 33 of FRS 102 'Related Party Disclosures' and has not disclosed transactions entered into between two or more members of a group, provided that any subsidiary undertaking which is party to the transaction is wholly owned by a member of that group.
12
Parent company
The company's immediate and ultimate UK parent company is Laudico Limited, which is the smallest and largest group for which group accounts containing this company are prepared. Laudico Limited is domiciled and incorporated in the UK. Copies of the financial statements are available from Companies House, Crown Way, Cardiff, CF14 3UZ.
The directors regards the ultimate parent undertaking to be Oak Haven Properties Limited a company incorporated in the British Virgin Islands.
The directors considers the ultimate controlling party to be the Tchenguiz Discretionary Trust