Really Useful Group Investments Limited
Annual Report and Financial Statements
For the year ended 30 June 2019
Company Registration No. 08159409 (England and Wales)
Really Useful Group Investments Limited
Company Information
Directors
J L Koravos
J C Quillan
(Appointed 17 June 2019)
A A Lloyd Webber
Lord A Lloyd Webber
Lady M A Lloyd Webber
W Lloyd Webber
(Appointed 26 September 2018)
M G Wordsworth
Secretary
J C Quillan
Company number
08159409
Registered office
6 Catherine Street
London
WC2B 5JY
Auditor
Moore Kingston Smith LLP
Charlotte Building
17 Gresse Street
London
W1T 1QL
Bankers
Svenska Handelsbanken AB
2nd Floor
1 Kingsway
London
WC2B 6AN
Really Useful Group Investments Limited
Contents
Page
Strategic report
1 - 2
Directors' report
3
Directors' responsibilities statement
4
Independent auditor's report
5 - 7
Statement of comprehensive income
8
Group balance sheet
9
Company balance sheet
10
Group statement of changes in equity
11
Company statement of changes in equity
12
Group statement of cash flows
13
Notes to the financial statements
14 - 36
Really Useful Group Investments Limited
Strategic Report
For the year ended 30 June 2019
Page 1
The directors present the strategic report and financial statements for the year ended 30 June 2019.
The directors, in preparing this strategic report, have complied with s414C of the Companies Act 2006.
Principal activity
The company and group are wholly-owned by The Lord Lloyd Webber.
The company's principal activity is that of a holding company. The group's principal activities include the development and exploitation of the copyrights and other rights which it owns in musical and dramatic works. It markets these rights internationally through productions, recordings, music publishing, merchandising, television, video and films.
The directors are not aware, at the date of this report, of any likely major changes in the company's activities in the next financial period.
Review of the business
The profit for the year amounted to £5,743,225
(2018: £3,653,430).
Income is primarily generated through royalties and profit share from investment in theatrical productions, stock and amateur licensing, music publishing,
merchandise,
films and records.
The group suffered an exceptional loss in the year, as described in Note 4 to the Financial Statements.
Key performance indicators
As shown in the consolidated profit and loss account set out on page
8
group turnover has increased
22.7%
(201
8
:
15.4
%) on the prior period. The group’s gross profit has
in
creased
36.9%
(201
8
:
increased 21.5
%).
Principal risks and uncertainties
The group holds various copyrights and other rights to musical and dramatic works. There is a risk that the popularity of these copyrights and other rights may diminish over time and that the group may not be able to exploit them in the same manner as previous years. This risk is considered when the group is planning the performance timings of various productions and the locations around the world in which the productions will play. The group's experience of staging productions is used to ensure that rights are exploited across territories in the best way so as to introduce new audiences to productions and to ensure longevity of the rights held.
As well as this, the group is active in acquiring new rights to various productions which it can exploit in the future.
In addition to the above the group's activities expose it to a number of financial risks including cash flow risk and foreign exchange risk which is detailed below.
Really Useful Group Investments Limited
Strategic Report (Continued)
For the year ended 30 June 2019
Page 2
Financial risk management objectives and policies
The group's activities expose it to a number of financial risks including credit risk, cash flow risk and liquidity risk. The principal risks and uncertainties that the group faces are discussed below.
Cash flow risk
The group operates in a number of countries around the world and is therefore exposed to movements in currency exchange rates. The directors consider that the level of trading in overseas currencies does not warrant taking out hedges to manage any fluctuations in exchange rates. However, the group's treasury function manages the risk by disposing of foreign currency balances on a regular basis.
Liquidity risk
In order to maintain liquidity to ensure that sufficient funds are available for ongoing operations and future developments, the main group operating company, The Really Useful Group Limited, has in place an overdraft facility in order to meet day-to-day working capital requirements.
The Really Useful Group Investments Limited group
took
out a bank loan
in the previous year
to enable the purchase of a new office building. The group has managed exposure to interest rate fluctuations via an interest rate cap linked to the loan.
Going concern
After making enquiries, the directors have a reasonable expectation that the company and the group have adequate resources to continue in operational existence for the foreseeable future. Accordingly, the directors continue to adopt the going concern basis in preparing the financial statements.
Further details regarding the adoption of the going concern basis can be found within the principal accounting policies in the notes to the financial statements.
Future developments
The directors expect the general level of activity to remain consistent with 201
9
in the forthcoming year.
M G Wordsworth
Director
18 February 2020
Really Useful Group Investments Limited
Directors' Report
For the year ended 30 June 2019
Page 3
The directors present their annual report and financial statements for the year ended 30 June 2019.
Principal activities
Details of the principal activities, review of the business, principal risks and uncertainties, financial risk management objectives and policies and future developments can be found in the strategic report on pages 1 to 2 and form part of this report by cross-reference.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
I K Chester
(Resigned 5 April 2019)
J L Koravos
J C Quillan
(Appointed 17 June 2019)
A A Lloyd Webber
Lord A Lloyd Webber
Lady M A Lloyd Webber
W Lloyd Webber
(Appointed 26 September 2018)
M G Wordsworth
Results and dividends
The results for the year are set out on page 8.
No ordinary dividends were paid (2018: £-). The directors do not recommend payment of a final dividend.
Auditor
In accordance with the company's articles, a resolution proposing that Moore Kingston Smith LLP be reappointed as auditor of the group will be put at a General Meeting.
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 auditor
of the
company 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 auditor
of the
company
is
aware of that information.
On behalf of the board
M G Wordsworth
Director
18 February 2020
Really Useful Group Investments Limited
Directors' Responsibilities Statement
For the year ended 30 June 2019
Page 4
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 group and company, and of the profit or loss of the group for that period. In preparing these financial statements, the directors are required to:
-
select suitable accounting policies and then apply them consistently;
-
make judgements and accounting estimates that are reasonable and prudent;
-
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 group’s and company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and 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 group and company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Really Useful Group Investments Limited
Independent Auditor's Report
To the Members of Really Useful Group Investments Limited
Page 5
Opinion
We have audited the financial statements of Really Useful Group Investments Limited
(the 'parent company') and its subsidiaries (the 'group')
for the year ended 30 June 2019 which comprise the Group Statement of Comprehensive Income, the Group Balance Sheet, the Company Balance Sheet, the Group Statement of Changes in Equity, the Company Statement of Changes in Equity, the Group Statement of Cash Flows 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 group's and the parent company's affairs as at 30 June 2019 and of the group's profit for the year then ended;
-
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
-
have been prepared in accordance with the requirements of the Companies Act 2006.
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
group's or the parent
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 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.
Really Useful Group Investments Limited
Independent Auditor's Report (Continued)
To the Members of Really Useful Group Investments Limited
Page 6
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.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the
group and the parent
company and its environment obtained in the course of the audit, we have not identifie
d
material misstatements in the Strategic Report and the Directors' Report
.
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:
-
adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or
-
the parent company financial statements are not in agreement with the accounting records and returns; or
-
certain disclosures of directors' remuneration specified by law are not made; or
-
we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the 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
group's and the parent
company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the
group or the parent
company or to cease operations, or have no realistic alternative but to do so.
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.
Really Useful Group Investments Limited
Independent Auditor's Report (Continued)
To the Members of Really Useful Group Investments Limited
Page 7
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 group’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 group’s or the parent 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 group or the parent 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.
-
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.
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.
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.
Mark Twum-Ampofo (Senior Statutory Auditor)
for and on behalf of Moore Kingston Smith LLP
6 March 2020
Chartered Accountants
Charlotte Building
Statutory Auditor
17 Gresse Street
London
W1T 1QL
Really Useful Group Investments Limited
Group Statement of Comprehensive Income
For the year ended 30 June 2019
Page 8
2019
2018
Notes
£
£
Turnover
3
61,442,108
50,060,365
Cost of sales
(43,082,853)
(36,648,246)
Gross profit
18,359,255
13,412,119
Administrative expenses
(11,314,654)
(12,031,146)
Other operating income
72,861
5,486
Exceptional items
4
(2,795,450)
Operating profit
5
4,322,012
1,386,459
Share of results of associates and joint ventures
3,037,769
4,471,843
Interest receivable and similar income
9
51,113
36,844
Interest payable and similar expenses
10
(404,054)
(346,724)
Amounts written off investments
(497,133)
Profit before taxation
7,006,840
5,051,289
Tax on profit
11
(1,263,615)
(1,397,859)
Profit for the financial year
5,743,225
3,653,430
Other comprehensive income
Currency translation differences
174,583
(3,008)
Total comprehensive income for the year
5,917,808
3,650,422
Profit for the financial year is all attributable to the owners of the parent company.
Total comprehensive income for the year is all attributable to the owners of the parent company.
The Profit and Loss Account has been prepared on the basis that all operations are continuing operations.
Really Useful Group Investments Limited
Group Balance Sheet
As at 30 June 2019
Page 9
2019
2018
Notes
£
£
£
£
Fixed assets
Intangible assets
12
7,867,629
330,446
Tangible assets
13
22,339,169
20,603,475
Investments
14
3,055,986
2,876,978
33,262,784
23,810,899
Current assets
Stocks
16
607,882
433,072
Debtors
17
9,547,437
9,502,765
Cash at bank and in hand
9,401,100
9,009,692
19,556,419
18,945,529
Creditors: amounts falling due within one year
18
(22,851,738)
(16,764,444)
Net current (liabilities)/assets
(3,295,319)
2,181,085
Total assets less current liabilities
29,967,465
25,991,984
Creditors: amounts falling due after more than one year
19
(9,310,000)
(12,130,000)
Provisions for liabilities
22
(877,673)
-
Net assets
19,779,792
13,861,984
Capital and reserves
Called up share capital
24
2
2
Profit and loss reserves
19,779,790
13,861,982
Total equity
19,779,792
13,861,984
The financial statements were approved by the board of directors and authorised for issue on 18 February 2020 and are signed on its behalf by:
18 February 2020
J C Quillan
Director
Really Useful Group Investments Limited
Company Balance Sheet
As at 30 June 2019
30 June 2019
Page 10
2019
2018
Notes
£
£
£
£
Fixed assets
Investments
14
443,550
443,550
Current assets
Debtors
17
2,000,001
2,000,001
Creditors: amounts falling due within one year
18
(2,000,000)
(2,000,000)
Net current assets
1
1
Total assets less current liabilities
443,551
443,551
Capital and reserves
Called up share capital
24
2
2
Share premium account
443,549
443,549
Total equity
443,551
443,551
As permitted by s408 Companies Act 2006, the
Company has not presented its own profit and loss account and related notes. The Company’s result for the year was £0 (2018 - £0
profit).
The financial statements were approved by the board of directors and authorised for issue on 18 February 2020 and are signed on its behalf by:
18 February 2020
J C Quillan
Director
Company Registration No. 08159409
Really Useful Group Investments Limited
Group Statement of Changes in Equity
For the year ended 30 June 2019
Page 11
Share capital
Profit and loss reserves
Total
£
£
£
Balance at 1 July 2017
2
10,211,560
10,211,562
Year ended 30 June 2018:
Profit for the year
-
3,653,430
3,653,430
Other comprehensive income:
Currency translation differences on overseas subsidiaries
-
(3,008)
(3,008)
Total comprehensive income for the year
-
3,650,422
3,650,422
Balance at 30 June 2018
2
13,861,982
13,861,984
Year ended 30 June 2019:
Profit for the year
-
5,743,225
5,743,225
Other comprehensive income:
Currency translation differences on overseas subsidiaries
-
174,583
174,583
Total comprehensive income for the year
-
5,917,808
5,917,808
Balance at 30 June 2019
2
19,779,790
19,779,792
Really Useful Group Investments Limited
Company Statement of Changes in Equity
For the year ended 30 June 2019
Page 12
Share capital
Share premium account
Total
£
£
£
Balance at 1 July 2017
2
443,549
443,551
Year ended 30 June 2018:
Profit and total comprehensive income for the year
-
-
-
Balance at 30 June 2018
2
443,549
443,551
Year ended 30 June 2019:
Profit and total comprehensive income for the year
-
-
-
Balance at 30 June 2019
2
443,549
443,551
Really Useful Group Investments Limited
Group Statement of Cash Flows
For the year ended 30 June 2019
Page 13
2019
2018
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
30
12,477,623
1,749,323
Interest paid
(404,054)
(346,724)
Income taxes paid
(1,363,353)
(1,792,301)
Net cash inflow/(outflow) from operating activities
10,710,216
(389,702)
Investing activities
Purchase of intangible assets
(8,652,935)
-
Purchase of tangible fixed assets
(2,667,261)
(20,371,550)
Proceeds on disposal of tangible fixed assets
30,033
-
Purchase of joint ventures
-
(154,575)
Distributions received from joint ventures
2,651,503
3,448,339
Purchase of fixed asset investments
(50,827)
-
Capital invested in productions
(866,699)
(1,269,981)
Recoupment of investments in productions
1,196,265
920,797
Interest received
51,113
36,844
Net cash used in investing activities
(8,308,808)
(17,390,126)
Financing activities
Proceeds of new bank loans
-
12,400,000
Repayment of bank loans
(2,010,000)
-
Net cash (used in)/generated from financing activities
(2,010,000)
12,400,000
Net increase/(decrease) in cash and cash equivalents
391,408
(5,379,828)
Cash and cash equivalents at beginning of year
9,009,692
14,389,520
Cash and cash equivalents at end of year
9,401,100
9,009,692
Really Useful Group Investments Limited
Notes to the Financial Statements
For the year ended 30 June 2019
Page 14
1
Accounting policies
Company information
Really Useful Group Investments Limited
(“the company”)
is a
private
limited company domiciled and incorporated in England and Wales.
The registered office is
6 Catherine Street, London, WC2B 5JY.
The group consists of Really Useful Group Investments Limited and all of its subsidiaries.
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.
1.2
Basis of consolidation
In the parent company financial statements, the cost of a business combination is the fair value at the acquisition date of the assets given, equity instruments issued and liabilities incurred or assumed, plus costs directly attributable to the business combination. The excess of the cost of a business combination over the fair value of the identifiable assets, liabilities and contingent liabilities acquired is recognised as goodwill. The cost of the combination includes the estimated amount of contingent consideration that is probable and can be measured reliably, and is adjusted for changes in contingent consideration after the acquisition date.
Provisional fair values recognised for business combinations in previous periods are adjusted retrospectively for final fair values determined in the 12 months following the acquisition date.
I
nvestments in subsidiaries, joint ventures and associates are accounted for at cost less impairment.
The consolidated financial statements incorporate those of Really Useful Group Investments Limited and all of its subsidiaries (ie entities that the
g
roup controls through its power to govern the financial and operating policies so as to obtain economic benefits). Subsidiaries acquired during the year are consolidated using the purchase method. Their results are incorporated from the date that control passes.
All financial statements are made up to 30 June 2019
.
Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the
g
roup.
All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.
Entities other than subsidiary undertakings or joint ventures, in which the group has a participating interest and over whose operating and financial policies the group exercises a significant influence, are treated as associates. In the group financial statements, associates are accounted for
using the equity method.
Entities in which the group holds an interest and which are jointly controlled by the group and one or more other venturers under a
contractual arrangement are treated as joint ventures.
In the group financial statements, joint ventures are accounted for using the equity method.
Really Useful Group Investments Limited
Notes to the Financial Statements (Continued)
For the year ended 30 June 2019
1
Accounting policies
(Continued)
Page 15
1.3
Going concern
At the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
1.4
Turnover
Turnover comprises the amounts receivable, exclusive of Value Added Tax, for goods and services and
for royalties from theatre, video and film productions, records, publishing, stock and amateur licensing
and merchandising.
Certain royalty revenues from record, music publishing, stock and amateur and merchandising licences
and film are recognised once they can be reliably determined, usually once a royalty statement has
been received from a third party. This is consistent with industry practice.
All other revenues are recognised on a right to consideration basis.
Co-productions
The group is involved in a number of co-production arrangements with third parties. Where the group's consent is required to affect control over significant decisions these arrangements have been accounted for as joint ventures.
The operating profit earned as a result of the co-production arrangement has been presented on the face of the profit and loss account as a share of the result of the joint venture. The distributions received from co-productions during the year are shown as distributions from joint ventures. If the investment in the co-production is unrecouped at the year end, the group's share of profits is offset against the investment, with no operating profit recognised in the profit and loss account.
1.5
Intangible fixed assets other than goodwill
Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Intangible assets acquired on business combinations are recognised separately from goodwill at the acquisition date if the fair value can be measured reliably.
Amortisation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Copyrights
10 years straight line
Theatre and film productions
Over the life of the production
Capitalised pre-production costs
Over the life of the production
Really Useful Group Investments Limited
Notes to the Financial Statements (Continued)
For the year ended 30 June 2019
1
Accounting policies
(Continued)
Page 16
Copyrights
Expenditure incurred in relation to the establishment or acquisition of copyrights is recorded at cost less amortisation. The copyrights are being amortised over 10 years.
Capitalised pre-production costs
The
group
capitalises pre-production development costs incurred subsequent to the green-lighting of a new production to the extent that the directors have a reasonable belief that the production will recoup. Costs capitalised exclude marketing and promotional expenditure incurred in relation to the production. All relevant development expenditure is capitalised within intangible assets as pre-production costs and the
group
does not distinguish between the cost of physical assets, such as the set, and the development of broader aspects of the show, as the distinction is not useful and the expenditure is considered as a whole.
The amortisation period commences from the date of opening of the production. The estimated life of the production is under continual re-assessment, with the impact of any changes to the estimated life on the amortisation period being accounted for prospectively.
1.6
Tangible fixed assets
Tangible fixed assets
are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Freehold land
Not depreciated
Freehold buildings
15-50 years straight line
Short-term leasehold properties
Over the unexpired term of the lease
Fixtures and fittings
3 - 10 years straight line
Motor vehicles
4 years straight line
Theatre sets (third party productions)
3 years 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 recognised in the profit and loss account.
1.7
Fixed asset investments
Equity in
vest
ments are measured at fair value through profit or loss
,
except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably
,
which are recognised at cost less impairment until a reliable measure of fair value becomes available.
I
n the parent company financial statements, investments in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.
A subsidiary is an entity controlled by the
group. Control is
the power to govern the financial and operating policies of
the
entity so as to obtain benefits from its activities.
Really Useful Group Investments Limited
Notes to the Financial Statements (Continued)
For the year ended 30 June 2019
1
Accounting policies
(Continued)
Page 17
An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The
group
considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.
Investments in associates are initially recognised at the transaction price (including transaction costs) and are subsequently adjusted to reflect the
g
roup’s share of the profit or loss, other comprehensive income and equity of the associate using the equity method.
Any difference between the cost of acquisition and the share of the fair value of the net identifiable assets of the associate on acquisition is recognised as goodwill. Any unamortised balance of goodwill is included in the carrying value of the investment in associates.
Losses in excess of the carrying amount of an investment in an associate are recorded as a provision only when the company has incurred legal or constructive obligations or has made payments on behalf of the associate.
In the
parent c
ompany financial statements, investments in associates are accounted for at cost less impairment.
Entities in which the
group
has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities
.
Investments in theatre productions and films are not amortised but stated at cost, less any provision for impairment and loss any amounts recouped. In the opinion of the directors, adequate provision has been made.
1.8
Impairment of fixed assets
At each reporting
period
end date, the
group
reviews the carrying amounts of its tangible and intangible
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 carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.
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.
Really Useful Group Investments Limited
Notes to the Financial Statements (Continued)
For the year ended 30 June 2019
1
Accounting policies
(Continued)
Page 18
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.
1.9
Stocks
Stocks represent Work In Progress, being costs incurred on productions which have not yet been green lit. Work in Progress is stated at the lower of cost and recoverable amount.
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.
1.10
Cash at bank and in hand
Cash at bank and in hand
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.
1.11
Financial instruments
The group 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 group's balance sheet when the group becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset and 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
m
ethod 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.
Really Useful Group Investments Limited
Notes to the Financial Statements (Continued)
For the year ended 30 June 2019
1
Accounting policies
(Continued)
Page 19
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 group 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 group 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
paymen
ts 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.
Derecognition of financial liabilities
Financial liabilities are derecognised when the
group's contractual obligations expire or are discharged or cancelled.
1.12
Equity instruments
Equity instruments issued by the group are recorded at the proceeds received, net of direct issue costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the group.
1.13
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Really Useful Group Investments Limited
Notes to the Financial Statements (Continued)
For the year ended 30 June 2019
1
Accounting policies
(Continued)
Page 20
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
group’s
liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
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
if, and only if, there is
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.
1.14
Provisions
Provisions are recognised when the
group
has a legal or constructive present obligation as a result of a past event, it is probable that the
group
will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.
The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the reporting end date, taking into account the risks and uncertainties surrounding the obligation.
Where the effect of the time value of money is material, the amount expected to be required to settle the obligation is recognised at present value. When a provision i
s
measured at present value
,
the unwinding of the discount is recognised as a finance cost in profit or loss in the period
in which
it arises.
1.15
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.
1.16
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
Really Useful Group Investments Limited
Notes to the Financial Statements (Continued)
For the year ended 30 June 2019
1
Accounting policies
(Continued)
Page 21
1.17
Leases
Rentals payable under operating leases,
including
any lease incentives received, are charged to income on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the lease asset are consumed.
1.18
Foreign exchange
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation are included in the profit and loss account for the period.
2
Judgements and key sources of estimation uncertainty
In the application of the group’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.
Critical judgements
The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.
Co-productions
The group is involved in a number of co-production arrangements and these have been recognised as such when the group is able to affect control over significant decisions. In these cases the productions are accounted for as joint ventures. When considering the level of control the group review the financial, operational and creative control it exerts.
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.
Revenue recognition
Certain royalties revenues from record, music publishing, stock and amateur and merchandising licenses along with profits from productions and investments are recognised once they can be reliably determined, usually once a royalty statement has been received from a third party. There is often a delay in receiving the royalty income statement, at the year-end management therefore need to estimate the royalty income based on current and historical experience.
Really Useful Group Investments Limited
Notes to the Financial Statements (Continued)
For the year ended 30 June 2019
Page 22
3
Turnover and other revenue
An analysis of the group's turnover is as follows:
2019
2018
£
£
Turnover analysed by class of business
Theatre productions
52,287,157
38,844,778
Record and music publishing
6,432,639
7,866,747
Merchandising
1,602,061
1,827,960
Film production
1,120,251
1,520,880
61,442,108
50,060,365
2019
2018
£
£
Turnover analysed by geographical market
United Kingdom
21,294,164
19,232,172
USA and Canada
11,773,697
13,706,353
Europe
11,908,207
7,729,254
Japan
6,612,140
4,828,833
Australia and South East Asia
9,853,900
4,563,753
61,442,108
50,060,365
4
Exceptional costs
2019
2018
£
£
Exceptional bad debt
2,795,450
-
Angel of Music Limited, a 100% subsidiary of the Group, suffered exceptional costs of £2,795,450 in the year due to non-payment of invoices following the collapse of the tour promoter group Lunchbox Theatricals in Asia. Angel of Music Limited licensed Lunchbox Theatricals to present the three tour locations (Manila, Singapore and Kuala Lumpur) visited in these financial statements. The co-producers remain liable for the losses in the period in the proportions of 60% to The Really Useful Group Limited and 40% to Troika Entertainment LLC.
5
Operating profit
2019
2018
£
£
Operating profit for the year is stated after charging/(crediting):
Exchange (gains)/losses
(37,810)
11,208
Depreciation of owned tangible fixed assets
921,813
574,291
(Profit)/loss on disposal of tangible fixed assets
(37,364)
167,651
Amortisation of intangible assets
1,312,512
55,157
Operating lease charges
556,013
566,806
Really Useful Group Investments Limited
Notes to the Financial Statements (Continued)
For the year ended 30 June 2019
5
Operating profit
(Continued)
Page 23
Exchange differences recognised in profit or loss during the year, except for those arising on financial instruments measured at fair value through profit or loss, amounted to £37,810 (2018 - £11,208).
6
Auditor's remuneration
2019
2018
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the group and company
19,650
19,000
Audit of the financial statements of the company's subsidiaries
78,500
66,000
98,150
85,000
For other services
Preparation of statutory accounts
23,500
20,000
Taxation compliance services
10,000
-
Other assurance services
3,000
3,000
36,500
23,000
7
Employees
The average monthly number of persons (including directors) employed by the group and company during the year was:
Group
Company
2019
2018
2019
2018
Number
Number
Number
Number
Office and management
50
47
-
-
Theatre productions
149
108
-
-
199
155
-
-
Their aggregate remuneration comprised:
Group
Company
2019
2018
2019
2018
£
£
£
£
Wages and salaries
9,269,567
8,414,010
-
-
Social security costs
689,722
834,909
-
-
Pension costs
291,766
257,214
-
-
10,251,055
9,506,133
-
-
Really Useful Group Investments Limited
Notes to the Financial Statements (Continued)
For the year ended 30 June 2019
Page 24
8
Directors' remuneration
2019
2018
£
£
Remuneration for qualifying services
1,880,991
1,721,671
Company pension contributions to defined contribution schemes
17,769
32,354
Compensation for loss of office
-
230,000
1,898,760
1,984,025
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 5 (2018 - 5).
Remuneration disclosed above includes the following amounts paid to the highest paid director:
2019
2018
£
£
Remuneration for qualifying services
689,971
646,481
The Directors are considered to be the Key Management Personnel for the purposes of the statutory disclosure requirements for both the current and the prior year.
9
Interest receivable and similar income
2019
2018
£
£
Interest income
Interest on bank deposits
51,113
36,844
10
Interest payable and similar expenses
2019
2018
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
404,054
346,724
Really Useful Group Investments Limited
Notes to the Financial Statements (Continued)
For the year ended 30 June 2019
Page 25
11
Taxation
2019
2018
£
£
Current tax
UK corporation tax on profits for the current period
243,222
326,076
Adjustments in respect of prior periods
(31,254)
28,517
Total UK current tax
211,968
354,593
Foreign current tax on profits for the current period
947,438
1,121,839
Adjustments in foreign tax in respect of prior periods
(72,537)
14,244
Total current tax
1,086,869
1,490,676
Deferred tax
Origination and reversal of timing differences
116,584
(92,817)
Adjustment in respect of prior periods
60,162
-
Total deferred tax
176,746
(92,817)
Total tax charge for the year
1,263,615
1,397,859
The actual charge for the year can be reconciled to the expected charge based on the profit or loss and the standard rate of tax as follows:
2019
2018
£
£
Profit before taxation
7,006,840
5,051,289
Expected tax charge based on the standard rate of corporation tax in the UK of 19.00% (2018: 19.00%)
1,331,300
959,745
Tax effect of expenses that are not deductible in determining taxable profit
50,871
170,606
Tax effect of income not taxable in determining taxable profit
-
(269)
Tax effect of utilisation of tax losses not previously recognised
(700)
-
Losses on discontinued operations not recognised
-
1,035
Adjustments in respect of prior years
9,971
6,747
Effect of change in corporation tax rate
19,556
(24,555)
Other non-reversing timing differences
(73,391)
(72,810)
Effect of overseas tax rates
446,340
500,233
Under/(over) provided in prior years
(72,466)
2,138
UK Theatre tax credit
(447,866)
(145,011)
Taxation charge for the year
1,263,615
1,397,859
Really Useful Group Investments Limited
Notes to the Financial Statements (Continued)
For the year ended 30 June 2019
Page 26
12
Intangible fixed assets
Group
Copyrights
Capitalised pre-production costs
Total
£
£
£
Cost
At 1 July 2018
1,181,291
25,500
1,206,791
Additions
500
8,652,435
8,652,935
Exchange adjustments
-
230,215
230,215
At 30 June 2019
1,181,791
8,908,150
10,089,941
Amortisation and impairment
At 1 July 2018
876,345
-
876,345
Amortisation charged for the year
55,158
1,257,354
1,312,512
Exchange adjustments
-
33,455
33,455
At 30 June 2019
931,503
1,290,809
2,222,312
Carrying amount
At 30 June 2019
250,288
7,617,341
7,867,629
At 30 June 2018
304,946
-
330,446
The company had no intangible fixed assets at 30 June 2019 or 30 June 2018.
Really Useful Group Investments Limited
Notes to the Financial Statements (Continued)
For the year ended 30 June 2019
Page 27
13
Tangible fixed assets
Group
Freehold land and buildings
Short-term leasehold properties
Fixtures and fittings
Motor vehicles
Theatre sets (third party productions)
Total
£
£
£
£
£
£
Cost
At 1 July 2018
19,976,014
200,832
1,634,402
109,662
5,108,267
27,029,177
Additions
2,039,256
-
515,363
109,903
2,739
2,667,261
Disposals
-
-
(17,085)
(109,662)
(4,741,329)
(4,868,076)
Transfers
(394,533)
-
394,533
-
-
-
At 30 June 2019
21,620,737
200,832
2,527,213
109,903
369,677
24,828,362
Depreciation and impairment
At 1 July 2018
158,606
123,567
1,028,748
109,662
5,005,119
6,425,702
Depreciation charged in the year
401,422
23,708
446,476
13,738
36,469
921,813
Eliminated in respect of disposals
-
-
(7,331)
(109,662)
(4,741,329)
(4,858,322)
Transfers
(30,371)
-
30,371
-
-
-
At 30 June 2019
529,657
147,275
1,498,264
13,738
300,259
2,489,193
Carrying amount
At 30 June 2019
21,091,080
53,557
1,028,949
96,165
69,418
22,339,169
At 30 June 2018
19,817,408
77,265
605,654
-
103,148
20,603,475
The company had no tangible fixed assets at 30 June 2019 or 30 June 2018.
Really Useful Group Investments Limited
Notes to the Financial Statements (Continued)
For the year ended 30 June 2019
Page 28
14
Fixed asset investments
Group
Company
2019
2018
2019
2018
Notes
£
£
£
£
Investments in subsidiaries
28
-
-
443,550
443,550
Investments in joint ventures
29
1,587,734
1,201,468
-
-
Other investments
50,827
-
-
-
Investments in productions
1,417,425
1,675,510
-
-
3,055,986
2,876,978
443,550
443,550
Movements in fixed asset investments
Group
Investments in joint ventures
Investments in productions
Other investments
Total
£
£
£
£
Cost or valuation
At 1 July 2018
1,698,601
1,675,510
-
3,374,111
Additions
-
866,699
50,827
917,526
Share of profit for the year
3,006,062
-
-
3,006,062
Return of capital invested
-
(1,196,265)
-
(1,196,265)
Foreign exchange on translating overseas entities
31,707
71,481
-
103,188
Share of distributions received during the year
(2,651,503)
-
-
(2,651,503)
At 30 June 2019
2,084,867
1,417,425
50,827
3,553,119
Impairment
At 1 July 2018 and 30 June 2019
497,133
-
-
497,133
Carrying amount
At 30 June 2019
1,587,734
1,417,425
50,827
3,055,986
At 30 June 2018
1,201,468
1,675,510
-
2,876,978
Really Useful Group Investments Limited
Notes to the Financial Statements (Continued)
For the year ended 30 June 2019
14
Fixed asset investments
(Continued)
Page 29
Movements in fixed asset investments
Company
Shares in group undertakings
£
Cost or valuation
At 1 July 2018 and 30 June 2019
443,550
Carrying amount
At 30 June 2019
443,550
At 30 June 2018
443,550
15
Financial instruments
Group
Company
2019
2018
2019
2018
£
£
£
£
Carrying amount of financial assets
Debt instruments measured at amortised cost
6,082,054
5,697,335
2,000,001
2,000,001
Equity instruments measured at cost less impairment
50,827
-
443,550
443,550
Instruments measured at fair value through profit or loss
1,587,734
1,201,468
-
-
Loan commitments measured at cost less impairment
1,417,425
1,675,790
-
-
Carrying amount of financial liabilities
Measured at amortised cost
27,537,368
24,980,349
2,000,000
2,000,000
16
Stocks
Group
Company
2019
2018
2019
2018
£
£
£
£
Work in progress
607,882
433,072
-
-
Really Useful Group Investments Limited
Notes to the Financial Statements (Continued)
For the year ended 30 June 2019
Page 30
17
Debtors
Group
Company
2019
2018
2019
2018
Amounts falling due within one year:
£
£
£
£
Trade debtors
1,637,077
1,620,043
1
1
Corporation tax recoverable
824,839
548,355
-
-
Amounts due from group undertakings
-
-
2,000,000
2,000,000
Other debtors
511,906
979,686
-
-
Prepayments and accrued income
4,651,325
5,090,956
-
-
7,625,147
8,239,040
2,000,001
2,000,001
Amounts falling due after more than one year:
Deferred tax asset (note 21)
1,922,290
1,263,725
-
-
Total debtors
9,547,437
9,502,765
2,000,001
2,000,001
18
Creditors: amounts falling due within one year
Group
Company
2019
2018
2019
2018
Notes
£
£
£
£
Bank loans and overdrafts
20
1,080,000
270,000
-
-
Trade creditors
1,181,898
2,013,767
-
-
Amounts due to group undertakings
-
-
2,000,000
2,000,000
Other taxation and social security
296,585
475,926
-
-
Other creditors
4,315,645
1,361,314
-
-
Accruals and deferred income
15,977,610
12,643,437
-
-
22,851,738
16,764,444
2,000,000
2,000,000
Intercompany balances are interest free and repayable on demand.
19
Creditors: amounts falling due after more than one year
Group
Company
2019
2018
2019
2018
Notes
£
£
£
£
Bank loans and overdrafts
20
9,310,000
12,130,000
-
-
Really Useful Group Investments Limited
Notes to the Financial Statements (Continued)
For the year ended 30 June 2019
Page 31
20
Loans and overdrafts
Group
Company
2019
2018
2019
2018
£
£
£
£
Bank loans
10,390,000
12,400,000
-
-
Payable within one year
1,080,000
270,000
-
-
Payable after one year
9,310,000
12,130,000
-
-
During the year ended 30 June 2018
, Handelsbanken
granted
a facility for a 6 year
L
ibor term loan drawn down to £12,400,000.
The loan was repayable from June 2019 and the rate of interest is Libor + 1.95%.
The loan is secured via a charge over freehold land and buildings with a net book value of £21,091,080 (2018: £19,817,408) and a group composite guarantee over the assets of the group.
21
Deferred taxation
Deferred tax assets and liabilities are offset where the group or company has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:
Liabilities
Liabilities
Assets
Assets
2019
2018
2019
2018
Group
£
£
£
£
Capital allowances in excess of depreciation
-
-
503,527
610,416
Short term timing differences
-
-
148,907
246,068
Losses
-
-
1,157,392
124,510
Other fixed asset timing differences
820,673
-
112,464
282,731
820,673
-
1,922,290
1,263,725
The company has no deferred tax assets or liabilities.
Group
Company
2019
2019
Movements in the year:
£
£
Liability/(asset) at 1 July 2018
(1,263,725)
-
Charge to profit or loss
176,746
-
Foreign exchange
(14,638)
-
Liability/(asset) at 30 June 2019
(1,101,617)
-
Really Useful Group Investments Limited
Notes to the Financial Statements (Continued)
For the year ended 30 June 2019
21
Deferred taxation
(Continued)
Page 32
The deferred tax assets set out above are expected to reverse within 12 - 120 months and relate to
decelerated capital allowances, the utilisation of tax losses against future expected profits of the same
period, and other short-term timing differences.
22
Provisions for liabilities
Group
Company
2019
2018
2019
2018
Notes
£
£
£
£
Provision for closing costs of Theatrical Production
57,000
-
-
-
Deferred tax liabilities
21
820,673
-
-
-
877,673
-
-
-
Movements on provisions apart from deferred tax liabilities:
Group
£
Additional provisions in the year
57,000
23
Retirement benefit schemes
2019
2018
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
291,766
257,214
A
defined contribution pension scheme
is operated
for all qualifying employees.
The assets of the scheme are held separately from those of the group in an independently administered fund.
At the year end pension contributions of £39,071 (2018: £37,388) remained outstanding and have been included within "Other Creditors".
24
Share capital
Group and company
2019
2018
Ordinary share capital
£
£
Issued and fully paid
2 Ordinary shares of £1 each
2
2
Really Useful Group Investments Limited
Notes to the Financial Statements (Continued)
For the year ended 30 June 2019
Page 33
25
Related party transactions
The Lord Lloyd Webber advances
The Lord Lloyd Webber is a controlling shareholder of the company and the group. During the year the group incurred royalty costs of £13,829,962 (2018: £11,289,517) due to The Lord Lloyd Webber. At the year end £7,481 (2018: £1,126,939) was due to The Lord Lloyd Webber in respect of these royalties.
The directors consider these transactions have been entered into at arm's length on normal commercial terms.
Royalty advances
Advances paid in prior periods to The Lord Lloyd Webber are non-refundable but recoupable against music publishing and record royalties due to him in the future. Royalties of £nil (2018: £17,471) were recouped against these advances during the year, leaving an unrecouped balance at the year end of £nil (2018: £nil).
The directors consider these transactions have been entered into at arm's length on normal commercial terms.
Payments to third parties
During the year the group made sales of £nil (2018: £31,227) and purchases of £257,076 (2018: £71,315) from LW Theatres Group Ltd, a related party by virtue of common control. At the year end, the group was owed £71,154 (2018: £116,179) by LW Theatres Group Ltd. Furthermore the group's London production of School of Rock rents the Gillian Lynne Theatre from LW Theatre Group on normal commercial terms.
During the year the group made available the services of an employee in exchange for the issue of shares representing 8.5% of the issued share capital of The Other Songs Ltd, a company with which the group shares certain directors.
During the year, rent on a property lease totalling £92,494 (2018: £91,244) was paid to The Lady Lloyd Webber, a director of the group.
26
Operating lease commitments
Lessee
At the reporting end date the group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
Group
Company
2019
2018
2019
2018
£
£
£
£
Within one year
194,880
475,782
-
-
Between two and five years
573,345
1,593,088
-
-
768,225
2,068,870
-
-
Subsequent to the year end the group surrendered the lease in respect of which future minimum lease payments are disclosed above.
Really Useful Group Investments Limited
Notes to the Financial Statements (Continued)
For the year ended 30 June 2019
Page 34
27
Controlling party
The ultimate controlling party is The Lord Lloyd Webber by virtue of his ownership of 100% of the ordinary share capital of the company.
28
Subsidiaries
Details of the company's subsidiaries at 30 June 2019 are as follows:
Name of undertaking
Registered
Nature of business
Class of
% Held
office key
shares held
Direct
Indirect
Company On Stage Limited
1
Theatre producer
Ordinary
100.00
Golgotha Limited
1
Dormant
Ordinary
100.00
Jacob & Sons Limited
1
Film production
Ordinary
100.00
Really Useful Films Limited
1
Film production
Ordinary
100.00
Really Useful Holdings Limited
1
Holding company
Ordinary
100.00
Really Useful MC Limited
1
Holding company
Ordinary
100.00
SOR Productions UK Limited
1
Theatre producer
Ordinary
100.00
The Opera Ghost Limited
1
Film production
Ordinary
100.00
The Really Useful Broadway Inc
2
Theatre producer
Ordinary
100.00
The Really Useful Broadway Limited
1
Theatre producer
Ordinary
100.00
The Really Useful Company Inc
2
Theatre producer
Ordinary
100.00
The Really Useful Company Limited
1
Dormant
Ordinary
100.00
The Really Useful Film Company Limited
1
Film production
Ordinary
100.00
The Really Useful Group Limited
1
Develop and exploit the rights of musical and dramatical works
Ordinary
100.00
The Really Useful North Company Inc
2
Dormant
Ordinary
100.00
The Really Useful Record Company Limited
1
Dormant
Ordinary
100.00
The Really Useful Theatre Company Inc
2
Theatre producer
Ordinary
100.00
The Really Useful Theatre Company Limited
1
Theatre producer
Ordinary
100.00
U-Cast Limited
1
Dormant
Ordinary
100.00
Angel of Music Limited
1
Theatre producer
Ordinary
100.00
Really Useful Touring Inc
2
Theatre producer
Ordinary
100.00
Really Useful Productions Europe Limited
3
Non-trading
Ordinary
100.00
Really Useful Group Investments Limited
Notes to the Financial Statements (Continued)
For the year ended 30 June 2019
28
Subsidiaries
(Continued)
Page 35
Registered Office address:
1
6 Catherine Street, London, WC2B 5JY
2
c/o Sauvigne & Company, LLP, Certified Public Accountants, 25 S. Service Road - Suite 100, Jericho, NY 11753
3
Commercial House, Millbank Business Park, Lucan, Co. Dublin, K78X5W6
Jacob & Sons Limited and Really Useful MC Limited have claimed exemption from audit under section 479A of the Companies Act 2006.
29
Joint ventures
Details of joint ventures at 30 June 2019 are as follows:
Name of undertaking
Registered
Nature of business
Class of
% Held
office
shares held
Direct
Indirect
Phantom London
England & Wales
Theatre producer
Investor profit share entitlement
24.20
The Phantom Company Partnership
USA
Theatre producer
Investor profit share entitlement
27.00
Phantom Touring LLC
USA
Theatre producer
Investor profit share entitlement
42.50
SOR Broadway Ltd
USA
Theatre producer
Investor profit share entitlement
59.06
The Music Company LP
USA
Theatre producer
Ordinary
37.50
The Musical Company Limited
England & Wales
Theatre producer
Ordinary
37.50
TMC GP LLC
USA
Holding company
Ordinary
50.00
Really Useful Group Investments Limited
Notes to the Financial Statements (Continued)
For the year ended 30 June 2019
29
Joint ventures
(Continued)
Page 36
The registered address for Phantom London is Number One Bedford Square, London, WC1B 3RB.
The registered address for The Phantom Company Ltd Partnership is 1650 Broadway, Suite 800, New York, NY 10019.
The registered address for Phantom Touring LLC is 7135 Minstrel Way, Suite 105, Columbia, MD 21045.
The registered address for SOR Broadway Ltd Partnership is 230 West 41st Street, Suite 1703, New York, NY 10036.
The registered address for The Musical Company LP is 2711 Centreville Road, Suite 400, Wilmington, DE 19808.
The registered address for The Musical Company Limited is 17 Slingsby Place, London, WC2E 9AB.
30
Cash generated from group operations
2019
2018
£
£
Profit for the year after tax
5,743,225
3,653,430
Adjustments for:
Share of results of associates and joint ventures
(3,037,769)
(4,471,843)
Taxation charged
1,263,615
1,397,859
Finance costs
404,054
346,724
Investment income
(51,113)
(36,844)
(Gain)/loss on disposal of tangible fixed assets
(37,364)
167,651
Amortisation and impairment of intangible assets
1,312,512
55,157
Depreciation and impairment of tangible fixed assets
921,813
574,291
Amounts written off investments
-
497,133
Increase in provisions
57,000
-
Movements in working capital:
(Increase) in stocks
(157,725)
(412,405)
Decrease/(increase) in debtors
836,229
(2,526,647)
Increase in creditors
5,223,146
2,504,817
Cash generated from operations
12,477,623
1,749,323
2019-06-30
2018-07-01
false
CCH Software
CCH Accounts Production 2019.301
I K Chester
J L Koravos
J C Quillan
A A Lloyd Webber
Lord A Lloyd Webber
Lady M A Lloyd Webber
Lady M A Lloyd Webber
W Lloyd Webber
J C Quillan
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