The directors present the strategic report for the year ended 31 December 2017.
The business was established to produce theatrical productions.
The directors expect the general level of activity to remain consistent with industry standards for the forthcoming year.
The principal activity of the company, is that of the production of theatrical shows . The industry is speculative by its nature and carries a degree of risk. Whilst there are many examples of theatrical shows that have not succeeded, there are many examples of theatrical shows which have run for many years and been financially successful.
The board drives business performance through setting clearly defined budgets from which it derives key performance indicators, taking appropriate action where required to enhance the financial results of the business. The company considers its key performance indicators to be:
- Show attendance - Gross admissions 2017: £15,788,049 (2016: £20,254,406)
- Show weeks - 2017: 52 (2016: 46.5)
The main financial risks arising from the Company's activities are credit risk, foreign exchange rate risk and liquidity risk. The directors monitor these risks on an ongoing basis and do not consider them to be significant.
The company's risk mitigation policy, in respect of credit risk, is to only deal with established reputable companies. The board does not consider this to be a significant risk.
The company does not consider interest rate risk to be significant. The company hold s its cash reserves in a mixture of short term deposits and current accounts which earn interest at a floating rate.
The working capital requirements of the company are funded principally out of shareholder loans and cash reserves.
The company will continue as long as the performance is profitable to the investors. The producers have announced that the West End run of the production will be terminating on 20 April 2019.
On behalf of the board
The directors present their annual report and financial statements for the year ended 31 December 2017.
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
The results for the year are set out on page 7.
Ordinary dividends were paid amounting to £622,577. The directors do not recommend payment of a final dividend.
In accordance with the company's articles, a resolution proposing that Kingston Smith LLP be reappointed as auditor of the company will be put at a General Meeting.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the 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 .
Other information
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' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.
As explained more fully in the Directors' Responsibilities Statement set out on page 3, 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.
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.
As part of an audit in accordance with ISAs (UK) we exercise professional judgement and maintain professional scepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purposes of expressing an opinion on the effectiveness of the company’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors.
Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the company to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
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 for no purpose other than to draw to the attention of the company’s members those matters we are required to include in an auditor's report addressed to them. To the fullest extent permitted by law, we do not accept or assume responsibility to any party other than the company and the company’s members as a body, for our work, for this report, or for the opinions we have formed.
The Profit And Loss Account has been prepared on the basis that all operations are continuing operations.
MTM West End Ltd is a private company limited by shares incorporated in England and Wales. The registered office is Charlotte Building, 17 Gresse Street, London, W1T 1QL.
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 pound.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements , including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group . T he company has therefore taken advantage of e xemptions from the following disclosure requirements:
Section 4 ‘Statement of Financial Position’ – Reconciliation of the opening and closing number of shares ;
Section 7 ‘Statement of Cash Flows’ – Presentation of a statement of cash f low and related notes and disclosures ;
Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues’ – Carrying amounts, interest income/expense and net gains/losses for each category of financial instrument; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income ;
Section 33 ‘Related Party Disclosures’ – Compensation for key management personnel .
The financial statements of the company are consolidated in the financial statements of MTM (Group) Ltd . These consolidated financial statements are available from Companies House, Crown Way, Cardiff, CF14 3UZ.
A 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.
Revenue from theatrical productions is recognised by reference to the performance date.
Equity instruments issued by the company 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 company.
The company has an obligation to restore that part of the theatre its production is running within to its original condition. This provision is recorded in full at the end of the pre-production period within prepayments and charged as an expense to the Profit and Loss account over the expected life of the production.
In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.
Provisions have been made for the get out costs relating to the closure of the production . These provisions are estimates and the actual costs and timing of future cash flows are dependent on future events. The difference between expectations and the actual future liability will be accounted for in the period when such determination is made.
An analysis of the company's turnover is as follows:
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 £1,744 (2016 - £-).
The average monthly number of persons (including directors) employed by the company during the year was:
Their aggregate remuneration comprised:
The actual credit for the year can be reconciled to the expected (credit)/charge for the year based on the profit or loss and the standard rate of tax as follows:
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.
Included within Other Creditors are outstanding commitments of £5,456 (2016: £3,825).
After the balance sheet date, the producers announced that the West End run of the production will be terminating on 20 April 2019.
Adam Spiegel Productions Limited
During the year the company was invoiced £462,555 (2016: £635,203) for royalties and fees by Adam Spiegel Productions Limited, a company in which Adam Spiegel is a director and has controlling interest. At the balance sheet date £27,308 (2016: 41,493) was outstanding in respect of these amounts and included in accrued expenses.
ALMTUK Limited
During the year the company was invoiced £59,520 (2016: £160,785) for royalties by ALMTUK Limited, a company which holds 100 Ordinary B shares in MTM (Group) Limited. At the balance sheet date £5,108 (2016: £19,293) was outstanding in respect of these amounts and included in accrued expenses.
Alchemation LLC
During the year the company was invoiced £91,091 (2016: £126,700) for royalties and fees by Alchemation LLC, a company which has controlling interest in ALMTUK Limited. At the balance sheet date £4,500 (2016: £4,500) was outstanding in respect of these amounts and included in accrued expenses.
Society of London Theatre
During the year the company was invoiced £35,993 (2016: £32,464) for fees by Society of London Theatre, a company in which Adam Spiegel is a director. At the balance sheet date £3,571 (2016: 3,237) was outstanding in respect of these amounts and included in trade creditors.
No amounts were written off or provided for in respect of the balances above during the year.
The immediate parent company is MTM (Group) Limited, a company registered in England and Wales, by virtue of its ownership of 100% of the issued share capital in the company.
The ultimate parent company is Morgo UK LLC, a company incorporated in the United States of America, by virtue of its ownership of 100% of the issued share capital in Morgo UK Limited.
The ultimate controlling parties are the managing members of Morgo UK LLC.