Company Registration No. 05319043 (England and Wales)
The County Hotel Canterbury Limited
Annual report and financial statements
for the period ended 29 December 2019
The County Hotel Canterbury Limited
Company information
Directors
Jeremy Hancock
Andrew Brownsword
Stephanie Hocking
Peter Tyrrell
Alessandra Brownsword-Matthews
(Appointed 15 May 2019)
David Matthews
(Appointed 15 May 2019)
Secretary
Peter Tyrrell
Company number
05319043
Registered office
8 Gay Street
Bath
BA1 2PH
Independent auditors
Saffery Champness LLP
St Catherine's Court
Berkeley Place
Clifton
Bristol
BS8 1BQ
Business address
30-33 High Street
Canterbury
Kent
CT1 2RX
The County Hotel Canterbury Limited
Contents
Page
Strategic report
1 - 2
Directors' report
3 - 5
Independent auditor's report
6 - 8
Statement of comprehensive income
9
Statement of financial position
10
Statement of changes in equity
11
Notes to the financial statements
12 - 22
The County Hotel Canterbury Limited
Strategic report
For the period ended 29 December 2019
Page 1
The directors present the strategic report and financial statements for the period ended 29 December 2019.
Fair review of the business
Reduced corporate and conference demand in the market led to a slight decline year on year in terms of revenues. Management reacted well and were able to control expenditure thus mitigating the shortfall in top line revenues.
The profit for the period, after taxation, amounted to £191,413 (period ended 30 December 2018: £500,726) and will be transferred to reserves.
Net assets at the period end were £12,374,252 (period ended 30 December 2018: £12,182,839).
No dividends were paid or proposed in the period.
Principal risks and uncertainties
The
company
manages competitive trading risk by providing high quality services and maintaining
consistent renewal of its properties and
strong relationships with its customers.
In line with the hotel and restaurant industry generally, the business is exposed to normal economic and market factors which ultimately reflect the strength of the economy and the strength of local conditions. This is affected by business usage and tourism as well as normal seasonal factors and weather conditions.
The continual increase of hotel bedroom supply in all cities has a negative impact on the ability to maximise pricing.
It is the
company
's policy that payments to suppliers are made in accordance with those terms and conditions agreed between the group and its suppliers, provided that all trading terms and conditions have been complied with.
The directors believe the
company
is well placed to compete in the market despite challenging market conditions.
Development and performance
In March 2020, the Coronavirus worldwide pandemic resulted in the hotel closing from 23 March to 4 July 2020. This temporary closure resulted in no revenue, whilst at the same time the hotel continued to have certain fixed costs (insurance, utilities, IT contracts etc).
The company utilised the government's Coronavirus Job Retention Scheme to minimise the cost of payroll whilst it was closed. As this measure is due to cease in October 2020, the company has made the difficult decision to restructure in order to sustain its long term future.
The County Hotel Canterbury Limited
Strategic report (continued)
For the period ended 29 December 2019
Page 2
Key performance indicators
To enable review of performance and benchmarking within the
company
, many KPI’s are regularly used
and
key
example
s
of these would be:
-
Average Room Rate
-
Oc
cupancy
-
Y
ield
-
F
ood and beverage
gross profit margin
-
C
ertain room costs
and
payroll
per occupied room
-
W
age cost
as a percentage of revenue
-
U
tility cost per occupied
room
-
EBITDA
as a percentage of revenue
Peter Tyrrell
Director
18 August 2020
The County Hotel Canterbury Limited
Directors' report
For the period ended 29 December 2019
Page 3
The directors present their annual report and financial statements for the period ended 29 December 2019.
Principal activities
The principal activity of the company during the
period
was the provision of accommodation and restaurant services.
Directors
The directors who held office during the period and up to the date of signature of the financial statements were as follows:
Jeremy Hancock
Andrew Brownsword
Stephanie Hocking
Peter Tyrrell
Alessandra Brownsword-Matthews
(Appointed 15 May 2019)
David Matthews
(Appointed 15 May 2019)
Results and dividends
The results for the period are set out on page 9.
The Directors' Report does not include a fair review of the business, details of the risks and uncertainties and future developments, as this information is documented within the Strategic Report as required under s414C(11) of The Companies Act 2006.
Financial instruments
Liquidity risk
The company, along with its wider group, have significant cash resources to meet its financial obligations and has the ongoing support of its ultimate sole shareholder.
Interest rate risk
The company does not have borrowings and is not therefore exposed to interest rate risk.
Foreign currency risk
The company makes its sales and purchases in sterling and so is not exposed to foreign currency risk.
Credit risk
Credit risk is considered low for the company as credit terms are not provided to the majority of customers.
The County Hotel Canterbury Limited
Directors' report (continued)
For the period ended 29 December 2019
Page 4
Post reporting date events
Following the period end, the outbreak of coronavirus, which is a rapidly evolving situation, has adversely impacted global commercial activities. This led to the closure of the hotel within the company between 23 March and 4 July, after which the hotel successfully reopened following government advice. The company has utilised government measures to the best extent, which has eased immediate cash flow requirements. Due to the reduction in revenues during the lockdown period and the Coronavirus Job Retention Scheme due to end in October 2020, the company has made the difficult decision to restructure in order to sustain its long term future.
The directors do not believe that this leads to an uncertainty with regard to the going concern of the company due to the liquidity within the Andrew Brownsword Hotels Limited group and The Bath Priory Hotel Limited and also the ongoing support of the ultimate sole shareholder.
Auditor
Saffery Champness LLP have expressed their willingness to continue in office.
Statement of directors' responsibilities
The directors are responsible for preparing the annual report 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 of the profit or loss of the company 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;
-
state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;
-
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 transactions and disclose with reasonable accuracy at any time the financial position of the company 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 hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The County Hotel Canterbury Limited
Directors' report (continued)
For the period ended 29 December 2019
Page 5
Statement of disclosure to auditor
So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.
On behalf of the board
Peter Tyrrell
Director
18 August 2020
The County Hotel Canterbury Limited
Independent auditor's report
To the members of The County Hotel Canterbury Limited
Page 6
Opinion
We have audited the financial statements of The County Hotel Canterbury Limited (the 'company') for the period ended 29 December 2019 which comprise the statement of comprehensive income, the statement of financial position, the statement of changes in equity and 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 FRS 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 company's affairs as at 29 December 2019 and of its profit for the period 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.
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
Auditor's
responsibilities for the audit of the financial statements section of our report. We are independent of the company 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
We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report to you where:
-
the directors' use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or
-
the directors have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the company’s ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the financial statements are authorised for issue
.
The County Hotel Canterbury Limited
Independent auditor's report (continued)
To the members of The County Hotel Canterbury Limited
Page 7
The directors are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor's report 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 there is a material misstatement in the financial statements or a material misstatement of the other information. 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 our audit
:
-
the information given in the strategic report and the directors' r
eport for the financial period 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.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identifie
d
material misstatements in the strategic report and the directors'
r
eport
.
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, or returns adequate for our audit have not been received from branches not visited by us; or
-
the 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 directors'
r
esponsibilities
s
tatement, 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 County Hotel Canterbury Limited
Independent auditor's report (continued)
To the members of The County Hotel Canterbury Limited
Page 8
Auditor's 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 auditor's 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.
A further description of our responsibilities for the audit of the financial statements is located on the
Financial Reporting Council’s website at: http://www.frc.org.uk/auditorsresponsibilities
.
This description forms part of our auditor's 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.
Michael Strong (Senior Statutory Auditor)
for and on behalf of Saffery Champness LLP
24 August 2020
Chartered Accountants
Statutory Auditors
St Catherine's Court
Berkeley Place
Clifton
Bristol
BS8 1BQ
The County Hotel Canterbury Limited
Statement of comprehensive income
For the period ended 29 December 2019
Page 9
Period
Period
ended
ended
29 December
30 December
2019
2018
Notes
£
£
Turnover
3
4,055,095
4,338,400
Cost of sales
(2,173,608)
(2,182,284)
Gross profit
1,881,487
2,156,116
Administrative expenses
(1,697,035)
(1,658,575)
Operating profit
4
184,452
497,541
Interest receivable and similar income
6
6,961
3,185
Profit before taxation
191,413
500,726
Tax on profit
7
-
-
Profit for the financial period
191,413
500,726
The income statement has been prepared on the basis that all operations are continuing operations.
The County Hotel Canterbury Limited
Statement of financial position
As at 29 December 2019
Page 10
2019
2018
Notes
£
£
£
£
Fixed assets
Tangible assets
8
10,184,814
10,256,465
Current assets
Stocks
9
33,342
39,190
Debtors
10
172,180
169,896
Cash at bank and in hand
2,603,141
2,239,696
2,808,663
2,448,782
Creditors: amounts falling due within one year
11
(619,225)
(522,408)
Net current assets
2,189,438
1,926,374
Total assets less current liabilities
12,374,252
12,182,839
Capital and reserves
Called up share capital
13
3,375,001
3,375,001
Share premium account
10,125,000
10,125,000
Profit and loss reserves
(1,125,749)
(1,317,162)
Total equity
12,374,252
12,182,839
The financial statements were approved by the board of directors and authorised for issue on 18 August 2020 and are signed on its behalf by:
Peter Tyrrell
Director
Company Registration No. 05319043
The County Hotel Canterbury Limited
Statement of changes in equity
For the period ended 29 December 2019
Page 11
Share capital
Share premium account
Profit and loss reserves
Total
£
£
£
£
Balance at 1 January 2018
3,375,001
10,125,000
(1,817,888)
11,682,113
Period ended 30 December 2018:
Profit and total comprehensive income for the period
-
-
500,726
500,726
Balance at 30 December 2018
3,375,001
10,125,000
(1,317,162)
12,182,839
Period ended 29 December 2019:
Profit and total comprehensive income for the period
-
-
191,413
191,413
Balance at 29 December 2019
3,375,001
10,125,000
(1,125,749)
12,374,252
The County Hotel Canterbury Limited
Notes to the financial statements
For the period ended 29 December 2019
Page 12
1
Accounting policies
Company information
The County Hotel Canterbury Limited is a
private
company
limited by shares
incorporated in England and Wales.
The registered office is
8 Gay Street, Bath, BA1 2PH.
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.
The financial statements are prepared in
sterling
, which is the functional currency of the company.
Monetary a
mounts
in these financial statements are
rounded to the nearest £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
The financial statements of the company are drawn up to either a 52 or 53 week period each year which is in accordance with the company management accounts. This is in line with the Companies Act 2006 as the period end is never more than seven days before or after the year end date of 31 December each year.
The County Hotel Canterbury Limited constitutes a qualifying entity, as set out within FRS 102 Section 1 "Scope", due to it being a 100% subsidiary of Andrew Brownsword Hotels Limited, and is included within the consolidated accounts of that company, which can be located at Companies House.
As the company meets the criteria of a qualifying entity, it has taken advantage of the following exemptions available to it:
-
The requirements of Section 7 "Statement of Cash Flows" and Section 3 "Financial Statement Presentation" paragraph 3.17(d);
-
The requirements of Section 11 "Basic Financial Instruments" and Section 12 "Other Financial Instruments Issues" outlined in paragraph 1.12(c); and
-
The requirement of Section 33 "Related Party Disclosures" paragraph 33.7.
1.2
Going concern
A
true
t the time of approving the financial statements
,
t
he directors have a reasonable expectation that the
company
has adequate resources to continue in operational existence for the foreseeable future. Thus
t
he directors continue to adopt the going concern basis of accounting in preparing the financial statements.
The County Hotel Canterbury Limited
Notes to the financial statements (continued)
For the period ended 29 December 2019
1
Accounting policies (continued)
Page 13
1.3
Turnover
Revenue is recognised to the extent that the company obtains the right to consideration in exchange for its performance. Revenue is measured at the fair value of the consideration received, excluding discounts, rebates, value added tax and other sales taxes or duty. The following criteria must be met before revenue is recognised
:
Accommodation revenue is recognised when a room is occupied; food and beverage revenue is recognised when food and beverages are sold; sundry and other revenues, consisting of items such as room hire and car parking, are recognised at the point of sale.
1.4
Tangible fixed assets
Tangible fixed assets
are initially measured at cost and subsequently measured at cost, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost of assets less their residual values over their useful lives on the following bases:
Land and buildings freehold
Nil - 20% straight line
Land and buildings leasehold
Nil - 20% straight line
Plant and machinery
5 - 20% straight line
Fixtures, fittings & equipment
10 - 25% straight line
Computer equipment
25 - 33% straight line
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
.
In accordance with normal practice in the UK hotel industry, no depreciation is provided on the company's freehold property acquired at cost. It is the company's practice to maintain its property in a continual state of sound repair and to make improvements thereto from time to time. Accordingly, the directors consider that the life of the asset and residual value, based on the price prevailing at the time of acquisition, is such that its depreciation would be insignificant.
The company has undertaken a refurbishment to the property. This expenditure is split between work to the core of the building, with nil depreciation and work to building surfaces and services, with a finite useful economic life and depreciated at rates between 5% and 10% accordingly.
1.5
Impairment of fixed assets
At each reporting
period
end date, the
company
reviews the carrying amounts of its tangible
assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company
estimates the recoverable amount of the cash-generating unit to which the asset belongs.
The County Hotel Canterbury Limited
Notes to the financial statements (continued)
For the period ended 29 December 2019
1
Accounting policies (continued)
Page 14
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.
1.6
Stocks
Stocks comprise raw materials and finished goods which are food and beverages respectively. Stocks
are stated at the lower of cost and
estimated selling price less costs to complete and sell.
At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.
1.7
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.
1.8
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 statement of financial position 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.
The County Hotel Canterbury Limited
Notes to the financial statements (continued)
For the period ended 29 December 2019
1
Accounting policies (continued)
Page 15
Basic financial assets
Basic financial assets, which include debtors, 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.
Impairment of financial assets
Financial assets, other than those
held
at
fair value through profit and loss
, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected.
If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Derecognition of financial assets
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.
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.
The County Hotel Canterbury Limited
Notes to the financial statements (continued)
For the period ended 29 December 2019
1
Accounting policies (continued)
Page 16
Basic financial liabilities
Basic financial liabilities, including trade and other 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 receipts discounted at a market rate of interest.
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. Accounts payable are classified as 'creditors: amounts falling due within one year' if payment is due within one year or less. If not, they are presented as 'creditors: amounts falling due after more than one year'. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Financial liabilities classified as payable within one year are not amortised.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations
expire or are discharged or cancelled.
1.9
Equity instruments
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.
1.10
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
1.11
Retirement benefits
Contributions in respect of the company's defined contribution pension scheme are charged to the profit and loss account for the period in which they are payable to the scheme. Differences between contributions payable and contributions actually paid in the period are shown either as accruals or prepayments at the period end.
The County Hotel Canterbury Limited
Notes to the financial statements (continued)
For the period ended 29 December 2019
Page 17
2
Critical accounting 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.
3
Turnover and other revenue
An analysis of the company's turnover is as follows:
2019
2018
£
£
Turnover
Hotel accommodation
2,480,793
2,634,939
Food and beverage
1,440,143
1,549,869
Sundry and other revenue
134,159
153,592
4,055,095
4,338,400
4
Operating profit
2019
2018
Operating profit for the period is stated after charging:
£
£
Fees payable to the company's auditor for the audit of the company's financial statements
6,850
6,850
Depreciation of owned tangible fixed assets
202,536
188,635
Cost of stocks recognised as an expense
431,374
457,634
The County Hotel Canterbury Limited
Notes to the financial statements (continued)
For the period ended 29 December 2019
Page 18
5
Employees
The average monthly number of persons (including directors) employed by the company during the period was:
2019
2018
Number
Number
Employees
86
77
Their aggregate remuneration comprised:
2019
2018
£
£
Wages and salaries
1,344,309
1,297,935
Social security costs
93,453
86,973
Pension costs
17,946
12,379
1,455,708
1,397,287
6
Interest receivable and similar income
2019
2018
£
£
Interest income
Interest on bank deposits
6,961
3,185
The County Hotel Canterbury Limited
Notes to the financial statements (continued)
For the period ended 29 December 2019
Page 19
7
Taxation
The actual charge for the period can be reconciled to the expected charge for the period based on the profit or loss and the standard rate of tax as follows:
2019
2018
£
£
Profit before taxation
191,413
500,726
Expected tax charge based on the standard rate of corporation tax in the UK of 19.00% (2018: 19.00%)
36,368
95,138
Tax effect of expenses that are not deductible in determining taxable profit
6,542
4,915
Change in unrecognised deferred tax assets
(42,910)
(98,250)
Group relief
-
(605)
Deferred tax adjustments in respect of prior years
-
(1,198)
Taxation charge for the period
-
-
The company has available trading losses carried forward of £47,389 (period ended 30 December 2018: £18,692).
The County Hotel Canterbury Limited
Notes to the financial statements (continued)
For the period ended 29 December 2019
Page 20
8
Tangible fixed assets
Land and buildings freehold
Land and buildings leasehold
Plant and machinery
Fixtures, fittings & equipment
Computer equipment
Total
£
£
£
£
£
£
Cost
At 31 December 2018
13,108,306
200,000
1,108,243
1,212,559
206,823
15,835,931
Additions
22,563
-
54,356
52,814
1,152
130,885
At 29 December 2019
13,130,869
200,000
1,162,599
1,265,373
207,975
15,966,816
Depreciation
At 31 December 2018
3,641,474
-
665,510
1,092,433
180,049
5,579,466
Charge for the period
34,681
-
74,765
74,567
18,523
202,536
At 29 December 2019
3,676,155
-
740,275
1,167,000
198,572
5,782,002
Carrying amount
At 29 December 2019
9,454,714
200,000
422,324
98,373
9,403
10,184,814
At 30 December 2018
9,466,832
200,000
442,733
120,126
26,774
10,256,465
9
Stocks
2019
2018
£
£
Raw materials and consumables
10,955
7,469
Finished goods and goods for resale
22,387
31,721
33,342
39,190
10
Debtors
2019
2018
Amounts falling due within one year:
£
£
Trade debtors
45,328
56,610
Other debtors
4,097
87
Prepayments and accrued income
122,755
113,199
172,180
169,896
The County Hotel Canterbury Limited
Notes to the financial statements (continued)
For the period ended 29 December 2019
Page 21
11
Creditors: amounts falling due within one year
2019
2018
£
£
Trade creditors
121,605
95,078
Taxation and social security
130,066
146,297
Other creditors
235,447
135,495
Accruals and deferred income
132,107
145,538
619,225
522,408
12
Retirement benefit schemes
2019
2018
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
17,946
12,379
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.
13
Share capital
2019
2018
£
£
Ordinary share capital
Issued and fully paid
13,500,004 Ordinary shares of 25p each
3,375,001
3,375,001
Shares rank equally for voting purposes. On a show of hands, each member shall have one vote and on a poll each member shall have one vote per share held.
14
Capital commitments
Amounts contracted for but not provided in the financial statements amounted to £
nil (period ended 30 December 2018:
£
49,243).
15
Ultimate controlling party
The company's ultimate controlling parent company is Andrew Brownsword Hotels Limited, which is incorporated in England and Wales. The company's ultimate controlling party is Andrew Brownsword, by virtue of his shareholding in the ultimate parent company.
The County Hotel Canterbury Limited
Notes to the financial statements (continued)
For the period ended 29 December 2019
Page 22
16
Related party transactions
No guarantees have been given or received.
The company has taken advantage of the exemption available in FRS 102 section 33 "Related Party Disclosures" whereby it has not disclosed transactions with the ultimate parent company or any wholly owned subsidiary undertaking of the group.
Andrew Brownsword owns and controls both the ultimate parent company and The Bath Priory Limited. During the period, The Bath Priory Limited made purchases from The County Hotel Canterbury Limited totalling £228 (period ended 30 December 2018: £280). A balance of £33 (period ended 30 December 2018: £nil) was outstanding at the period end. The Bath Priory made sales to The County Hotel Canterbury Limited totalling £5,367 (period ended 30 December 2018: £9,361). A balance of £839 (period ended 30 December 2018: £918) was due to The Bath Priory Limited at the period end.
Andrew Brownsword also owns and controls Paxton & Whitfield Limited. During the period to 29 December 2019, Paxton & Whitfield Limited made sales of £5,318 (period ended 30 December 2018: £5,597) to The County Hotel Canterbury Limited. A balance of £248 (period ended 30 December 2018: £397) was outstanding at the period end.
17
Contingent assets
As at the date of signing the financial statements, the company is undergoing a claim against various financial institutions in relation to finance charges. Although settlement is considered probable, the expected settlement cannot be reliably estimated at this stage.
18
Post balance sheet event disclosure
Following the period end, the outbreak of coronavirus, which is a rapidly evolving situation, has adversely impacted global commercial activities. This led to the closure of the hotel within the company between 23 March and 4 July, after which the hotel successfully reopened following government advice. The company has utilised government measures to the best extent, which has eased immediate cash flow requirements. Due to the reduction in revenues during the lockdown period and the Coronavirus Job Retention Scheme due to end in October 2020, the company has made the difficult decision to restructure in order to sustain its long term future.
The directors do not believe that this leads to an uncertainty with regard to the going concern of the company due to the liquidity within the Andrew Brownsword Hotels Limited group and The Bath Priory Hotel Limited (see note 16) and also the ongoing support of the ultimate sole shareholder.
2019-12-29
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