TIDMTRAF
RNS Number : 0440X
Trafalgar Property Group PLC
15 December 2023
TRAFALGAR PROPERTY GROUP PLC
("Trafalgar", the "Company" or "Group")
Final Results for the year ended 31 March 2023
Trafalgar (AIM:TRAF), the AIM quoted residential and assisted
living property developer, announces its final results for the
twelve months ended 31 March 2023.
The Company's Annual Report has been posted to shareholders, a
copy can also be found on the Company's website.
Enquiries:
Trafalgar Property Group Plc +44 (0) 1732 700
Paul Treadaway 000
Spark Advisory Partners Ltd - Nominated Adviser +44 (0) 20 3368
Matt Davis 3550
Peterhouse Capital Limited - Broker +44 (0) 20 7409
Duncan Vasey/Lucy Williams 0930
CHAIRMAN'S REPORT
On behalf of t he Board, I present T rafalgar P roperty Gro up
Plc (the Gro u p), results f or the year en ded 31 March 2023 w
hich incl u des one investment property sale co m pleted in the
year. T he o verall result continues to be disappointin g, as can
be seen in the attac hed Accou nts and Strategic Report. The option
we had in Leatherhead Surrey for a scheme to build seven properties
has now lapsed even though planning permission was finally granted.
The owners have received an offer elsewhere but will revert to us
if this does not materialize.
Orchard House in Hildenborough remained on the books at 31(st)
March 2023, however, the sale of the property was completed in
September 2023 for a consideration of GBP940,000.
In June contracts were exchanged on a scheme in Speldhurst that
had planning permission for a detached property. We reapplied for
and received full planning permission for the construction of one
and two bedroom apartments, however, it has since been decided that
a single detached barn would be built. Build contracts have been
signed and funding is in place from Lloyds Bank. This contractor is
on site and the project is proceeding well.
During the year the company raised GBP400,000 (before costs)
through the issuance of 133,333,333 new ordinary shares at a price
of 0.3p per share.
Financials
T he year u n der review s aw the Gro up t u r n o ver at
GBP18,183 (2 0 22: GBP64,839 ), with a lo ss a fter tax of
GBP843,626 ( 2 022: L o ss GBP486,336 ).
Ma nag e m e nt h a ve per f o r med a review of the ass ets a
nd liabilities of t he un der l ying su b s i diaries w hich f o rm
t he value of t he a nticipated pro fits on on g o i ng d e velo p
m e nts.
Due to the u ncertainties a nd ti m i ng of these planning
appeals, it has been ag reed by man a g e m e nt n ot to incl u de
any f u t u re anticipated pro fits of develo p m e n ts in t heir
as sess m e nt.
T he ca sh on the bala nce s heet at the end of t he year w as
GBP17,148 ( 20 22: GBP12,753) and t he Gro up co nti nu es to have
s uf ficie nt bank fac ilities f or all planned acti vitie s.
A further share issue was undertaken on 18 August 2023 raising
net proceeds of GBP115,000 to provide working capital for the
company.
Business Enviro n ment and Outlook
No new directors were appointed to the Group in the year but
James Dubois retired as Non-Executive Chairman of the Group on
23(rd) March 2023 due to health reasons. We all wish James the very
best for the future.
T he ef fec ts of the C o vid- 19 pan d e mic h ad a ffected o
ur bu sin e ss since March 2020 as sales of co m pleted u nits were
delayed with the planning process being negatively impacted. We
continue to proceed in a period of high inflation, cost of living
still close to a forty year high and high interest rates. L i ke m
o st b us i ness es, we are a ware of o ur need to co n d uct o u r
selv es caref ully to preser ve the health of o ur sta ff and custo
mer s and to conserve our cash reserves.
Paul Treadaway
Chairman
15 December 2023
CHIEF EXECUTIVE OFFICER 'S REPORT
Business review, re sults and dividends
All trading and property a ssets of T rafalgar P roperty Gro up
Plc (Gro u p) are held in the n a me of t he Gro up or its su b
sidiaries as f ollo w s:
T rafalgar New Ho mes L i mited ( TNH) T rafalgar Retir e m e
nt+ L i mited ( T R+)
Sel mat L i mited (Selm at)
Combe Bank Ho mes (Oa k hu r st) L i mited (Oak h u r st) C o m
be Ho m es (Boro ugh Gree n) L i mited (Boro ugh Gree n)
Life Hydroponic Assets Ltd (Inc. 24 October 2022)
Life Hydroponic Asset Ltd was incorporated in October 2022. The
subsequent acquisition of a dedicated research and development site
is a step in the Company's plan to facilitate its vertical
hydroponic strategy, with opportunities for research relevant to
food, cosmetic and pharmaceutical products. The parent company owns
100% share of the Company.
Mortgages of GBP675,698 (2022:GBP924,373) exist on t he
properties held by Sel mat. T he shares of t he parent company are
q u oted on the L o n don Stock Ex c h a nge A IM mar ket.
T he principal activity of t he Gro up co ntin ues to be t hat
of investment in residential property, which have a rental income
of GBP18,183 (2022: GBP64,839). The co ns olidated results of the y
ear 's tradin g, are sh o wn below. T he co ns olidated lo ss f or
the year was GBP843,626 (20 22: L o ss GBP486,336). Management
believes the key indicators of performance for the Group are the
revenue and profitability achieved during the year.
Principal risks & uncertainties
Set o ut below are ce r tain r isk f act o rs w h i ch co uld h
a ve an i m p act on t he Gr o u p's lo n g -te rm per f o r m a
nce. T he facto rs d is c u s sed below s h o uld n ot be re gar
ded as a co mplete a nd co m pr e h e n s i ve s tat e m e nt of
all potential risks a nd u ncertainties fac i ng t he Gro u p.
T he principal risks and uncer tainties fac i ng the Gro up
are:
1. Direct co sts m ay e scalate and eat into g ro ss pro fit mar
gin s due to unexpected interest rate movements and high inflation
rates putting pressure on material costs.
2. There may be uncertainty in obtaining adequate finance thus
putting pressure on the going concern of the Group.
3. Heavy o ver heads m ay be i n c u rred especially w hen pro
jects have been co m pleted a nd bef ore others have been co m
menced.
4. T he Gro up co uld commit too mu ch to future capital projects.
5. T he Gro u p 's reliance on k ey m e m bers of sta f f.
6. T he mar ket m ay deteriorate, d a maging liquidity of the
Group and f u t u re rev e nu e s.
T he Gro up co nsiders that it m itigates th e se ris ks with t
he f oll o w i ng policies a nd actio n s:
1. T he Gro up af f ords its ban kers and other len ders a stro
ng level of a sset and i nco me co ver a nd m aintains g ood
relatio nships with a range of f u n ding s o u rces f r om w h ich
it is able to sec u re f i nance on fav o u rable ter m s. The Plc
also has access to shareholder funding via placing of shares in the
market. A full statement regarding going concern is shown in the
accounting policies on page 23.
2. Direct co sts are o uts ourced on a f i xed price co ntract
basis, thereby passing on to the co ntractor all risk of co st o
ver s pen d, incl u d i ng f r om i ncrea sed material, labo ur or
other co sts.
3. Mo st other pro fessio nal ser v ices are also o uts o u
rced, th us pro viding a k n o wn f i xed co st bef ore any pr o
ject is tak en f o r ward and av oiding t he risk t hat can ar i se
in e m plo ying i n - h o use pro fes sio nals at a high un prod
ucti ve o ver head at ti mes w h en acti vity is slac k.
4. Buying decisions for capital projects are taken at Board
level, after careful research by the Directors per s o nall y, who
have substantial experience in various business sectors and
markets.
T he Gro up has f ocused on a nic he mar ket sector of n ew h o
me develo p m e nts in t he ran ge of fo ur to t w e n ty un its.
With in this u nit size, co m petition to p u rchase devel op m e
nt sites f r om la nd bu yers is relatively wea k, as t his size is
unattractive to maj or natio nal a nd r e gio nal h o use b uilders
w ho req uire a lar ger scale to j us tify their ad m i n i
stration a nd o ver head s, w hil st being too m a ny u n i ts f or
the s maller in depen dent b uilder to fin a n ce or u n dertake as
a pro ject. Many competitors who also focus on this niche have yet
to recapitalise and are unable to raise finance.
5. Many of the acti vities are outs o u rced and each of t he
Directors is f ully a ware of t he activities of all m e m ber
s.
6. T he Gro up has a corporate g o ver nance policy appropriate
f or a small p u blicly listed C o m p a ny with a m bitions s u b
sta ntially to raise its pro file wit hin t he wider i nv e stor co
mm u nit y.
Operations review
A s um mary of t he res ults f
or t he year is as f ollo w s :-
2 0 23 20 22
GBP GBP
Revenue for the year 18,183 64,839
Gross (loss)/profit (12,717) 61,680
Administration expenses (571,928) (459,655)
Loss on disposal of property (including
cost) (12,382) (28,646)
(Loss) Profit on revaluation (122,751) 112,000
Interest payable and similar charges (123,848) (171,714)
Loss after taxation (843,626) (486,336)
Gro up tu r n o ver f or the year a m ou nted to GBP18,183 ( 20
22: GBP64,839 ), r e presenting no sales but rental income received
. Investment properties have continued to be shown in current
assets this year as a result of the impending sales of the
remaining properties since the year end. The gross loss includes
costs written off following a termination by the vendor of the
Leatherhead site amounting to GBP29,750. In additional, two
investment properties were sold for net consideration of GBP649,618
and there was a loss on disposal on this of GBP12,382 The property
portfolio was revalued at year end and this showed an decrease in
value of GBP122,751.
.
After tak i ng into accou nt the o ver heads of the Gro u p,
there was a lo ss rec orded f or the year of GBP843,626 (2022:
GBP486,336).
T here w ill be no tax c har ge a nd the C o m p a ny n ow h as
tax lo sses bei ng carried f o r ward of GBP6,213,150 (20 22: lo
sses GBP5,453,582 ).
T he lo ss per share d u ring t he year w as (0.34p ), ( 2 022:
l o ss per share 0.34p).
Directors' duties under S172
T he Directors believe that, individ ually a nd to get her, th
ey have acted in the w ay t h ey c o nsider, in g ood faith, w o
uld be m o st li kely to pro m ote the s uccess of t he Group f or
the ben e fit of its m e m bers as a w h ole, having regard to the
stak e h olders and m atters set o ut in s 172(1)( a -f) of the Co
m p a nies Act 2006 in the decisio ns tak en d u ring the year en
ded 31 Ma rch 2023.
Our Board of Directors r e main a ware of t heir respon sibilit
ies both wit hin and o utside of the Gro u p. Wit h in t he li
mitations of a Gro up with so f ew e m plo yees we e n dea v o ur
to f ollow t hese prin ciples:
Purpo se, vision and s trateg y : this is set o ut on pages 4-7
on this Strategic Report and we recog nise o ur role in identi f y
i ng opportunities to develop h o mes a nd apartm e n ts to the
best q uality s tan dard s.
Group policies : t hese are revie wed a n nually and sta ff and
Directors are enco u r a ged to i m pr o ve t heir skillset as
appropriate.
Culture and peo ple : we f ully s u pport a cultu re w here all
custo mer s, sta ff and s u ppliers are treated in an open and h o
nest fas hio n, ir respective of race, g e n der, eth nic,
disabilities or other sce nario s.
Board s tructure : t he role of the Board is revie wed ann u
ally with a clear f o c us on t he s pecific roles ass i gned to
each i n divid ual to enable the Board to p r operly s u pport each
m e m ber of staf f.
Freedom within a fra mew o r k : we are developing a n ew fr a m
e w o rk f or co mm u nicati ng this f reed om in a strai gh t - f
o r ward meth odo l og y.
Risk and internal control fra mew ork : r i s ks and controls
are su b ject to discussion at quarterly Board meeti n g s. Every
pro ject un dertaken by the Gro up is an a l ysed w ith a view to
li miting t he ris ks to t he Gro up and its Sta keh olders b e f
ore proceeding w ith i m ple m e ntatio n.
Key perform ance indicators (KPIs)
Ma nag e m e nt are clo sely i n v olved in t he d ay to d ay
operatio ns of the Gro up and constantly monitor ca s h flo ws and
ex pen dit u re. Ho wever, Manag e m e nt belie ve t he k ey in
dicators of per f o r m a nce f or the Gro up are t he reven ue a
nd pro fitability ac hieved d u r i ng the period. T hese mea s u
res are disclo sed abo ve in t he operations revie w.
Develo p m ent Pipeline & outlook
We acquired the Barden Road site during the year, with build
funding provided by Lloyds Bank, and planning permission has now
been received for the construction of one and two bedroom
apartments, however, it has since been decided to build a single
detached barn. We have incurred costs to date of GBP317,796 on this
site as shown in inventory note 11 within the accounts. Contractors
are on site and progressing well.
Paul Treada w ay
CEO
15 December 2023
DIRECT O RS' REPORT
T he Directors present their R e port a nd A u dited Fi nan cial
State m e nts f or the year e n ded 31 March 2023.
Resul ts a nd dividends
T he results f or the year are set o ut on page 20.
T he Directors do n ot reco mm e nd the p a ym e nt of a final d
i v i dend f or the year (2022: nil).
Directors
T he f ollo w i ng Directors h a ve held o f fice s i nce 1 A
pril 2022 and have all ser ved f or the en tire acco unti ng year :
N A C L ott
P A Treadaway
G Thorneycroft
Dr P Challinor
Director's resignations during the year
J Dubois - 23 March 2023
T he C o m p a ny has in place an in s u rance policy in
relation to Directors in d e mnity d u r i ng both year s.
Conflicts of intere st
U n der t he ar ticles of a s s o ciati on of t he Co m pa ny a
nd in acc ord a n ce w ith t he p r o v i sio ns of t he C o m pa n
ies Act 20 0 6, a Di rector m u st a v o id a sit u a ti on wh ere
he h a s, or can h a v e, a d i rect or i n d i rect i n t ere st t
h at co nf li c ts, or po ssi b ly m ay co nf li ct wi th t he C o
m pan y's i n t ere sts. H owe v er, t he Di rec t ors m ay a u t h
or ise co nf li c ts a nd po t e n t i al co nf li c ts, as t h ey
deem appro p r i a t e. As a s a f e gu ard, o n ly Di rec t ors w
ho ha ve no i n ter e st in t he m a tter bei ng co n sidered w ill
be ab le to t a ke t he r ele v a nt dec isio n, a nd t he Di recto
rs w ill be able to i m po se li mits or co n ditions w h en g i v
i ng a uth oris ation if th ey t h i nk this is appro p riate. Du
ring the fin a ncial year en ded31 March 20 23, the Directors have
a u t h orised no su ch con flicts or potential co n f licts.
Directors' interests in the shares of the Company, including
family interests, at 31 March 2023 were as follows: -
Directors' interests in 31 . 03 . 2023 31 . 03 . 2022
shares
Or d i n a ry s h Or d i n a ry s h
ares - 0 . 1p each ares - 0 . 1p each
N Lott 50 , 000 50 , 000
P Treadaway 19,733,466 19,733,466
G Thorneycroft 600,000 600,000
31 . 03 . 2023 31 . 03 . 2022
Deferred shares - Deferred shares - 0.9p
0.9p each each
No. held No. held
N Lott 550,000 550,000
P Treadaway 10,648,466 10,648,466
Other subs tantial sh areho ldings
As at 14 December, 2023, being t he late st practicable date bef
ore the is sue of t h e se f i nancial state m e n t s, t he Co m p
a ny had been n oti fied of the f ollo w i ng s hareh oldings which
co nstitute 3% or m ore of the total is sued s hares of the Co m p
a ny at t hat date.
Ordinary
Shares Shareholdings
No. 0.1p %
Forum Energy Services Limited 75,000,000 18.71%
Peterhouse Capital Limited 43,156,080 10.77%
Paul Arthur Treadaway 19,773,465 4.93%
Christopher Charles Johnson 18,681,580 4.66%
Sta t e ment of directors' re s p onsibilities
C o m pany law req uires the Di rectors to prepare finan cial s
tate m e nts f or each fin a ncial y ear. Un der that law the
Directors h a ve elected to prepare the co ns olidated fin a ncial
state men ts in accordance with International Financial Reporting
Standards adopted in the UK ("UK adopted IFRS") a nd the C o m p a
ny f i n a ncial state ments in accordance w ith F RS 102 and ap
plicable la w. Un der Co m pany law the Directors m u st n ot appro
ve the fin a ncial state m e nts unle ss t h ey are satis fied that
t h ey g i ve a true and fair view of the state of a f fairs of t
he Gr o up and of t he pro fit or lo ss of the Gro up f or t hat
year. In preparing t hese fin a ncial state men t s, the Directors
are req uired to:
-- select s uitable accou nti ng policies a nd th en app ly t h em co n sistentl y;
-- make j u d g e m e n ts and esti mates that are rea s o nable and prudent;
-- state w hether applicable Acc o un ting Stan dards h a ve
been follo wed, s u b ject to any material departu res disclo sed
and ex plained in the fin a ncial state ments;
-- prepare the fin a ncial state m e nts on t he g o i ng co nce
rn basis unle ss it is i nappropriate to p resu me t hat the Gro up
will co nti nue in bu sin e ss.
T he Directors are respo nsible f or keep i ng adeq uate accou
nti ng records that are s u f ficie nt to sh ow a nd ex plain the
Gro u p 's tran sactions a nd dis clo se with rea s o nable ac c u
racy at a ny ti me the fin a ncial po s ition of t he Gr o up and
enable t h em to e n s u re t hat t he f i nancial state m e n ts
co m p ly w ith t he C o m panies A ct 2006. T h ey are al so respo
nsible f or s a f e guard i ng t he as sets of the Co m pany a nd
hence f or taking rea s o nable s teps f or the prev e ntion and
detection of f r a ud and other irregularities.
T hey are f u r t her respo nsible f or en s u r i ng t hat t he
Strate g ic Report and the Report of the Di rectors and o t her in
f o r mation i ncl u ded in the An n ual Report and Fin a ncial
State m e nts is prepared in acco r dance with applicable law in t
he Un ited Kin g d o m.
T he mai nte n a nce and i nteg r ity of the Gro up web s ite is
t he r e s po nsibility of t he Director s; t he w o rk carried o
ut by the au ditors does n ot in v olve the co nsideration of t
hese matters an d, according l y, t he au ditors accept no respo
nsibility or any c han g es that m ay h a ve occ u rred in the acco
unts s i nce th ey were initially presented on the web s ite.
L e gislation in t he U nited Ki n g d om g o verning t he
preparation and dis s e mination of the acco un ts and t he o t her
in f o r mation i ncl u ded in ann u al reports m ay differ f r om
le g islation in o t her j u ris dictio ns.
Corporate G overnance Sta t e m ent
T he Board of the Gro up rec o gn i se t he val ue of g ood cor
p orate g o ver n a nce a nd im plemented co r p o rate g o ver
nance p r oce d u res during the previous year and continued to use
these during the financial year to 31 March 2022. These procedures
are ap p r op riate f or the p resent size of the entity having
given d ue regard to the C o r p o rate Go ver nance Code f or S
mall and Mid -Size Qu o ted C o m panies issu ed by the Qu oted C o
m panies Allian ce ("QC A"). The C o m pany has dec i d ed to a p
ply the QCA C or p o rate Go ver nance Co de ( "QCA C o de") issu
ed by the QCA in May 20 18 and has p ublish ed on its web site deta
ils of the QCA C o de, h ow the C o m pany has co m plied with the
QCA C ode an d, w here it d e parts fr om the QCA Co d e, an ex p
lanation of the reaso ns f or d oing s o. The Board has considered
the Streamlined Energy and Carbon Reporting requirements and
conclude that the Group has not consumed more than 40,000 kWh of
energy and therefore qualifies as a low energy user and is exempt
from reporting under these regulations.
Board Structure
T he B oard co nsists of four Direct ors (2022: four) of w hich
three are exec utive and one n on-exec utive, two executive and one
non-executive directors hold shares in the G ro u p.
T he B oard m ee ts as a nd wh en re q u i r ed a nd is s a t is
f i ed t hat it is prov i ded wi th i n f o r ma ti on in an
appropr i a te f o rm a nd q u a li ty to e n a b le it to d is c h
a r ge i ts du t i e s. All Di re c t ors are re q u i r ed to re t
i re by rotation with o ne quarter of the Board see k i ng r e -
election each year.
Due to the c u rrent size of t he Gro u p, the d uties t hat w o
uld nor mally be attrib uted to T he N o mination C o mm ittee,
have been u n dertak en by the B oard as a w h ole.
T he Board h as underta k en a fo r mal ass e s s m e nt of t he
a u dit o r's i n d e p e n de nce a nd w ill co nti nue to do so
at least an n uall y. T his ass e s s m e nt in clu des:
-- a review of n on- a u dit ser vices pro vided to the Co m pany and the related fee s;
-- a re v i ew of t he a u d it or's o wn pr o ced u res for e n
s u r i ng t he i n depe n de n ce of t he a u d it f i rm a nd par
ti es and staff i n v olved in t he a u dit, inclu d i ng reg ular
rotation of t he au dit partner; a nd
-- obtaining con fir m ation f r om t he au ditor that, in t
heir pro fessio nal j u d g e m e nt, t h ey are i n depen
dent.
Internal Controls
T he B oard is r e s p o n s i b le f or t he Gr o u p's s y
stem of i n ter n al co ntro ls a nd for re v i e w i ng t heir e
ffecti v e n e s s. T he i n ter n al co n t ro ls are d e si g n
ed to e n s u re t he reliability of f i n a ncial i nfo r m ati on
f or b o th i nter nal a nd e xter nal p u rpo ses. T he Directors
are satis fied that t he cu rrent co ntrols are ef fective w ith
regard to the size of t he Gr o u p. Any i nter nal co ntrol s y
stem can o n ly pr o vide rea s o nab le, b ut n ot ab s o l u te a
s s ur a nce agai n st m aterial mis- state ment or lo ss. Gi ven
the size of t he Gro u p, t he Board has as sessed that there is c
urrently no need f or an inter n al a u dit f u nctio n.
Financial Ins t r u ments
T he Gro u p 's principal f i nancial in stru m e nts co m pr i
se ca sh at bank, bank lo a ns, other loans a nd various ite ms wit
h in c u rrent as sets and c u rrent liabilities t hat arise
directly f r om its operatio ns. T he Dir ectors co nsider that the
k ey f i n a ncial risk is liq u i dit y. T his risk is ex plai ned
in t he section headed ' P rincipal ris ks a nd u ncertainties' in
the An n ual Report a nd Accou nts on p a ge 5.
Future Develo p ments
I n f o r m ation relati ng to f utu re develo p men ts is i ncl
u ded in the Strategic Report on pages 4 -7.
Post Balance Sheet Events
Following the year end, the Group accepted an offer on Orchard
House of GBP940,000 less costs of sale, with the proceeds being
used to clear the outstanding loan owed to Paragon Mortgages of
GBP698,060 , a partial loan repayment of GBP176,000 being made to
Mr G Howard, payment of creditors of GBP53,189.
On 18 August , the Company issued 125,000,000 new ordinary
shares of 0.1p fully paid up in cash at 0.1p per share under a
placing raising GBP125,000 before expenses.
Provision of inform ation to auditor
Each of the per s ons w ho are Directors at the ti me w h en
this Director s' Report is ap pro ved has con fir med that:
-- so far as t hat Director is a ware, there is no relev a nt a
u dit i n f o r mation of w hich t he Gro u p's au ditor is un a
ware; and
-- that Director has ta k en all t he steps that o u g ht to h a
ve been taken as a Director in order to be aware of any i n f o r
mation needed by t he Gro u p 's a u ditor in co nnection with
preparing t heir report a nd to establish that t he Gro u p's au
ditor is aware of the in f o r matio n.
Audi tor
T he au ditor, MHA, will be propo sed f or r e -appoin t m e nt
in accordance with Section 489 of the C o m p a nies Act 2006.
Following a rebranding exercise on 15 May 2023 the trading name of
the company's independent auditor changed from MHA MacIntyre Hudson
to MHA.
T his report was appro ved by t he Board and signed on its
behalf.
Paul Treada w ay
Direct or
15 December, 2023
To the Members of Trafalgar Property Group plc
For the purpose of this report, the terms "we" and "our" denote
MHA in relation to UK legal, professional and regulatory
responsibilities and reporting obligations to the members of
Trafalgar Property Group plc. For the purposes of the table on
pages 13 to 15 that sets out the key audit matters and how our
audit addressed the key audit matters, the terms "we" and "our"
refer to MHA. The Group financial statements, as defined below,
consolidate the accounts of Trafalgar Property Group plc and its
subsidiaries (the "Group"). The "Parent Company" is defined as
Trafalgar Property Group plc, as an individual entity. The relevant
legislation governing the Company is the United Kingdom Companies
Act 2006 ("Companies Act 2006").
Opinion
We have audited the financial statements of Trafalgar Property
Group plc for the year ended 31 March 2023.
The financial statements that we have audited comprise:
-- the Consolidated Statement of Comprehensive Income
-- the Consolidated Statement of Financial Position
-- the Consolidated Statement of Changes in Equity
-- the Consolidated Statement of Cash Flows
-- Notes 1 to 20 to the consolidated financial statements,
including significant accounting policies
-- the Company Balance Sheet
-- the Company Statement of Changes in Equity and
-- Notes 1 to 13 to the Company financial statements, including
significant accounting policies.
The financial reporting framework that has been applied in the
preparation of the Group financial statements is applicable law and
International Financial Reporting Standards as adopted in the
United Kingdom ("UK adopted IFRS"). The financial reporting
framework that has been applied in the preparation of the Parent
Company financial statements 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 of the Parent Company's affairs as at 31
March 2023 and of the Group's loss for the year then ended;
-- the Group financial statements have been properly prepared in
accordance with applicable law and International Financial
Reporting Standards as adopted in the United Kingdom (UK Adopted
IFRS);
-- the Parent Company financial statements have been properly
prepared in accordance with applicable law and United Kingdom
Generally Accepted Accounting Practice; and
-- have been prepared in accordance with the requirements of the Companies Act 2006.
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 Group
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 as applied to listed entities, 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.
Material uncertainty related to going concern
We draw your attention to the going concern section of the
accounting policies in the financial statements which states that
the group incurred substantial losses during the year and the
continued requirement for successful future equity or debt fund
raising. The impact of this together with other matters set out in
the note, indicate a material uncertainty that may cast significant
doubt on the group's ability to continue as a going concern. Our
opinion is not modified in respect of this matter.
Our evaluation of the Directors' assessment of the Group and the
Parent Company's ability to continue to adopt the going concern
basis of accounting included:
-- The consideration of inherent risks to the Group's and Parent
Company's operations and specifically their business model.
-- The evaluation of how those risks might impact on the Group's
and Parent Company's available financial resources.
-- Review of the mathematical accuracy of the cashflow forecast
model prepared by management and corroboration of key data inputs
to supporting documentation for consistency of assumptions used
with our knowledge obtained during the audit.
-- Challenging management for reasonableness of assumptions in
respect of the timing and quantum of cash receipts and payments
included in the cash flow model.
-- Where additional resources may be required the reasonableness
and practicality of the assumptions made by the Directors when
assessing the probability and likelihood of those resources
becoming available.
-- Holding discussions with management regarding future
financing plans, corroborating these where necessary and assessing
the impact on the cash flow forecast.
-- Evaluating the accuracy of historical forecasts against
actual results to ascertain the accuracy of management's
forecasts.
In auditing the financial statements, we have concluded that the
directors' use of the going concern basis of accounting in the
preparation of the financial statements is appropriate.
Our responsibilities and the responsibilities of the directors
with respect to going concern are described in the relevant
sections of this report.
Overview of our audit approach
Scope Our Group audit was scoped by obtaining an understanding
of the Group and its environment, including the
Group's system of internal control, and assessing
the risks of material misstatement in the financial
statements. We also addressed the risk of management
override of internal controls, including assessing
whether there was evidence of bias by the directors
that may have represented a risk of material misstatement.
The Group consists of seven reporting components,
of which three were considered to be significant
components: Trafalgar Property Group plc, Selmat
Limited and Trafalgar New Homes Limited. The significant
components were subjected to full scope audits
for the purposes of our audit report on the Group
financial statements.
Significant components were determined based on:
1) financial significance of the component to
the Group as a whole, and
2) assessment of the risk of material misstatements
applicable to each component.
Our audit scope results in all major operations
of the Group being subject to audit work.
---------------- ------------------------------------------------------------------------
Overall Materiality 2023 2022
------------------------- ----------- ----------- -------------------------------------
Group GBP26,400 GBP35,800 2% (2022: 2%) of gross assets
Parent Company GBP19,600 GBP19,500 2% (2022: 2%) of gross liabilities
Key audit matters
------------------------------------------------------------------------------------------
Recurring
* Undisclosed related party transactions
Key Audit Matters
Key Audit Matters are those matters that, in our professional
judgement, were of most significance in our audit of the financial
statements of the current period and include the most significant
assessed risks of material misstatement (whether or not due to
fraud) that we identified. These matters included those matters
which had the greatest effect on: the overall audit strategy; the
allocation of resources in the audit; and directing the efforts of
the engagement team. These matters were addressed in the context of
our audit of the financial statements as a whole, and in forming
our opinion thereon, and we do not provide a separate opinion on
these matters.
Undisclosed related party transactions
-----------------------------------------------------------------------------
Key audit The Group enters into a significant number
matter description of transactions with related parties, both
intra-group transactions and with individuals
related to the Group.
There is a risk that transactions (particularly
any transactions which are not at arm's length)
and balances with related parties are undisclosed
or misclassified.
-------------------- -------------------------------------------------------
How the scope of Our procedures included:
our audit responded
to the key audit Identifying the susceptibility of the financial
matter statements to material misstatement from related
party relationships and transactions.
Obtaining management's records of related
parties - who they are, the nature of these
relationships, whether any related party transactions
have been entered into in the year and the
nature of those transactions.
Understanding the controls procedures in place
to identify, account for and disclose RP relationships
and transactions, authorise and approve significant
transactions and arrangements (both in the
normal course of business and outside the
normal course of business).
An assessment of the presentation of related
party transactions within the financial statements,
this focused primarily on the Directors loan
accounts.
We reviewed movement on these balances in
the year and vouched items to supporting evidence.
We discussed with management the nature and
purpose of these items and considered whether
disclosure sufficiently addressed these matters.
In addition, we obtained written confirmation
of the balances from all disclosed parties
and confirmed key terms to agreements.
-------------------- -------------------------------------------------------
Key observations We concluded that the classification and disclosure
of related party transactions is complete
and appropriate.
-------------------- -------------------------------------------------------
Our application of materiality
Our definition of materiality considers the value of error or
omission on the financial statements that, individually or in
aggregate, would change or influence the economic decision of a
reasonably knowledgeable user of those financial statements.
Misstatements below these levels will not necessarily be evaluated
as immaterial as we also take account of the nature of identified
misstatements, and the particular circumstances of their
occurrence, when evaluating their effect on the financial
statements as a whole. Materiality is used in planning the scope of
our work, executing that work and evaluating the results.
Based on our professional judgement, we determined materiality
for the financial statements as a whole as follows:
Group financial statements Parent Company financial
statements
Overall GBP26,400 (2022: GBP35,800) GBP19,600 (2022: GBP19,500)
materiality
---------------------------------- ------------------------------------
How we 2% of gross assets (2021: 2% of gross liabilities (2021:
determined 2% of gross assets) 2% of gross liabilities)
it
---------------------------------- ------------------------------------
Rationale We consider gross assets The Parent Company is largely
for the to be the main measure a holding company incurring
benchmark by which the users of limited costs and financing
applied the financial statements the group. As a result of
assess the prospects and historic losses and the impairment
success of the Group. of investments, we have considered
Therefore, we consider gross liabilities as the most
this to be the most appropriate appropriate benchmark for
benchmark for Group materiality. materiality.
---------------------------------- ------------------------------------
Performance materiality is the application of materiality at the
individual account or balance level, set at an amount to reduce, to
an appropriately low level, the probability that the aggregate of
uncorrected and undetected misstatements exceeds materiality for
the financial statements as a whole. Performance materiality for
the Group was set at GBP15,840 (2022: GBP21,480) and at GBP11,760
(2022: GBP11,700) for the Parent Company which represents 60%
(2022: 60%) of the above materiality levels. In determining
performance materiality, we considered our understanding of the
entity, including the quality of the control environment and
whether we were able to rely on controls, and the nature, volume
and size of uncorrected misstatements in the previous period.
We agreed with management that we would report to them all audit
differences in excess of GBP1,320 (2022: GBP1,790) for the Group
and GBP980 (2022: GBP975) for the Company as well as differences
below that threshold that, in our view, warranted reporting on
qualitative grounds. We also report to management on disclosure
matters that we identified when assessing the overall presentation
of the financial statements.
Overview of the scope of the Group and Parent Company audits
Our assessment of audit risk, evaluation of materiality and our
determination of performance materiality sets our audit scope for
each company within the Group. Taken together, this enables us to
form an opinion on the consolidated financial statements. This
assessment takes into account the size, risk profile, organisation
/ distribution and effectiveness of group-wide controls, changes in
the business environment and other factors such as recent internal
audit results when assessing the level of work to be performed at
each component.
The Group consists of 7 components, all of which are based in
the UK and audited by the Group audit team.
Number of components Revenue Total assets Loss before
tax
------------ --------------------- -------- ------------- ------------
Full scope
audit 3 100% 96% 98%
------------ --------------------- -------- ------------- ------------
Analytical
Review 4 0% 4% 2%
------------ --------------------- -------- ------------- ------------
Total 7 100% 100% 100%
------------ --------------------- -------- ------------- ------------
The control environment
We evaluated the design and implementation of those internal
controls of the Group, including the Parent Company, which are
relevant to our audit, such as those relating to the financial
reporting cycle. We also tested operating effectiveness but did not
place reliance on this work.
Reporting on other information
The other information comprises the information included in the
annual report other than the financial
statements and our auditor's report thereon. The Directors are
responsible for the other information contained within the annual
report. 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. 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 course of 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 this gives rise to a material
misstatement in the financial statements themselves. 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.
Strategic report and directors' report
In our opinion, based on the work undertaken in the course of
the 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.
In the light of the knowledge and understanding of the Group and
the Parent Company and their environment obtained in the course of
the audit, we have not identified material misstatements in the
strategic report or the directors' report.
Matters on which we are required to report by exception
We have nothing to report in respect of the following matters in
relation to which 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
by 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, as set out on page 9, 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 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 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 financial
statements is located on the FRC's website at:
www.frc.org.uk/auditorsresponsibilities . This description forms
part of our auditor's report.
Extent to which the audit was considered capable of detecting
irregularities, including fraud
Irregularities, including fraud, are instances of non-compliance
with laws and regulations. We design procedures in line with our
responsibilities, outlined above, to detect material misstatements
in respect of irregularities, including fraud.
These audit procedures were designed to provide reasonable
assurance that the financial statements were free from fraud or
error. The risk of not detecting a material misstatement due to
fraud is higher than the risk of not detecting one resulting from
error and detecting irregularities that result from fraud is
inherently more difficult than detecting those that result from
error, as fraud may involve collusion, deliberate concealment,
forgery or intentional misrepresentations. Also, the further
removed non-compliance with laws and regulations is from events and
transactions reflected in the financial statements, the less likely
we would become aware of it.
Identifying and assessing potential risks arising from
irregularities, including fraud
The extent of the procedures undertaken to identify and assess
the risks of material misstatement in respect of irregularities,
including fraud, included the following:
-- We considered the nature of the industry and sector the
control environment, business performance including remuneration
policies and the Group's, including the Parent Company's, own risk
assessment that irregularities might occur as a result of fraud or
error. From our sector experience and through discussion with the
directors, we obtained an understanding of the legal and regulatory
frameworks applicable to the Group focusing on laws and regulations
that could reasonably be expected to have a direct material effect
on the financial statements, such as provisions of the Companies
Act 2006, UK tax legislation or those that had a fundamental effect
on the operations of the Group.
-- We enquired of the directors and management concerning the
Group's and the Parent Company's policies and procedures relating
to:
- identifying, evaluating and complying with the laws and
regulations and whether they were aware of any instances of
non-compliance;
- detecting and responding to the risks of fraud and whether
they had any knowledge of actual or suspected fraud; and
- the internal controls established to mitigate risks related to
fraud or non-compliance with laws and regulations.
-- We discussed among the engagement team regarding how and
where fraud might occur in the financial statements and any
potential indicators of fraud.
-- We assessed the susceptibility of the financial statements to
material misstatement, including how fraud might occur by
evaluating management's incentives and opportunities for
manipulation of the financial statements. This included utilising
the spectrum of inherent risk and an evaluation of the risk of
management override of controls. We determined that the principal
risks were related to posting inappropriate journal entries to
increase revenue or reduce costs, creating fictitious transactions
to hide losses or to improve financial performance, and management
bias in any accounting estimates.
Audit response to risks identified
In respect of the above procedures:
-- we corroborated the results of our enquiries through our
review of the minutes of the Group's and the Parent Company's board
meetings and enquiries of management regarding any ongoing legal
cases;
-- audit procedures performed by the engagement team in
connection with the risks identified included:
- Performing audit work over the risk of management override of
controls, including testing of journal entries and other
adjustments for appropriateness, evaluating the business rationale
of significant transactions outside the normal course of business,
and reviewing accounting estimates for bias.
- Reviewing financial statement disclosures and testing to
supporting documentation to assess compliance with applicable laws
and regulations.
- Challenging assumptions and judgements made by management in
their significant accounting estimates, in particular with respect
to provisions for claims incurred but not reported.
-- the Senior Statutory Auditor considered the experience and
expertise of the engagement team to ensure that the team had the
appropriate competence and capabilities; and
-- we communicated relevant laws and regulations and potential
fraud risks to all engagement team members, and remained alert to
any indications of fraud or non-compliance with laws and
regulations throughout the audit.
Use of our report
This report is made solely to the Parent 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 Parent 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 Parent Company and the
Parent Company's members as a body, for our audit work, for this
report, or for the opinions we have formed.
Andrew Moyser FCA FCCA (Senior Statutory Auditor)
for and on behalf of MHA, Statutory Auditor
London, United Kingdom
15 December 2023
MHA is the trading name of MacIntyre Hudson LLP, a limited
liability partnership in England and Wales (registered number
OC312313)
Year Year
ended en ded
31 M arch 2023 31 March
2022
Note GBP GBP
Rev e n ue 1 18,183 64,839
C o st of s ales 2 (30,900) (3,159)
--------------- ---------------
Gro ss (loss)/pro fit (12,717) 61,680
A d m i nistrati ve ex p e ns es 2 (571,928) (459,655)
Fair value movement on investment property 8 (122,751) 112,000
(Loss) on disposal of investment property 8 (12,382) (28,646)
Operating (lo ss) 2 (719,778) (314,622)
( L o ss) before intere st (719,778) (314,622)
I nterest p a yable and s i m ilar char
ges 4 (123,848) (171,714)
--------------- ---------------
( L o ss) before ta x ation (843,626) (486,336)
Income tax 5 - -
--------------- ---------------
( L o ss) after ta x ation f or the
year a t tributable to equity holders
of the parent (843,626) (486,336)
Other co m preh e ns i ve i nco me attrib - -
utable to eq uity h olders of the parent
--------------- ---------------
T otal c o mprehensive (lo ss) f or
the year (843,626) (486,336)
=============== ===============
( L o ss) attributable to:
Eq uity h olders of the Parent (843,626) (486,336)
T otal co mprehensive (lo ss) f or the
year attributable to:
Eq uity h olders of the Parent (843,626) (486,336)
( LOSS) PER ORDI N A RY SHARE: Basic/diluted 6 (0.34) p (0.34) p
All r e sults in the c u rrent a nd preceding fin a ncial year
derive f r om co nti n u i ng operatio ns.
T he n otes on pages 32 to 44 are an inte g ral part of th e se
co n s olidated fin a ncial state m e nts.
As at As at
Note 31 M arch 2023 31 March 2022
GBP GBP
T O T AL ASS E TS
Non-current a ssets
Plant a nd eq uip m e nt 7 25,853 1,137
25,853 1,137
Current a ssets
I nv e nto ry 11 317,796 25,657
Investment Properties 8 927,249 1,712,000
T r a de and other receivables 9 34,033 40,500
Cash and ca sh eq u i vale nts 10 17,148 12,753
-------------- --------------------
1,296,226 1,790,910
T otal a ssets 1,322,079 1,792,047
============== ====================
E QUI T I ES & LIABI L I T I ES
Current liabilities
T r a de and other payables 12 222,863 370,233
Bor r o wings 13 874,697 869,697
-------------- --------------------
1,097,560 1,239,930
Non-current liabilities
Deferred tax 5 - -
Bor r o wings 13 3,573,217 3,824,724
T otal liabilities 4,670,777 5,064,654
Net (liabilities)/Assets (3,348,698) (3,272,607)
-------------- --------------------
Called up s hare 14 2,860,150 2,726,817
Share premium 3,484,915 3,250,249
Reverse acquisition reserve (2,817,633) (2,817,633)
Loan note equity reserve 14 & 16 107,204 30,303
Capital contribution reserve 17 400,147 157,777
P ro fit & lo ss accou nt (7,383,481) (6,620,120)
-------------- --------------------
T otal Equity (3,348,698) (3,272,607)
-------------- --------------------
T otal Equity & Lia bilities 1,322,079 1,792,047
============== ====================
T hese financial s tatements w e re a p p r o v ed by the B o
ard of Direc t o rs and autho ris ed f or i ssue on 15 December,
2023 and are signed on its behalf b y:
P T rea d a w a y:
.............................................. G Thorneycroft:
................................................
T he n otes on pages 32 to 44 are an inte g ral part of th e se
co n s olidated fin a ncial state m e nts.
Loan
Share Share Note Reverse Retained Capital Total
Capital Premium Equity acquisition profits/ Contribution Equity
Reserve reserve (losses) Reserve
GBP GBP GBP GBP GBP GBP GBP
At 1 April 2021 2,726,817 3,250,249 71,074 (2,817,633) (6,192,737) - (2,962,230)
Loss for the year (486,336) (486,336)
---------- ---------- --------- ------------ ------------ ------------- ------------
Total comprehensive
income for the
year (486,336) (486,336)
---------- ---------- --------- ------------ ------------ ------------- ------------
Loan note equity
reserve 18,182 18,182
Movement in loan
note equity reserve (58,953) 58,953 -
Capital contribution
during the period 157,777 157,777
At 31 March 2022 2,726,817 3,250,249 30,303 (2,817,633) (6,620,120) 157,777 (3,272,607)
========== ========== ========= ============ ============ ============= ============
At 1 April 2022 2,726,817 3,250,249 30,303 (2,817,633) (6,620,120) 157,777 (3,272,607)
Loss for the year (843,626) (843,626)
---------- ---------- --------- ------------ ------------ ------------- ------------
Total comprehensive
income for the
year (843,626) (843,626)
---------- ---------- --------- ------------ ------------ ------------- ------------
Loan note equity
reserve 76,901 80,165 157,066
Capital Contribution
during the period 242,370 242,370
Shares issued
during the year
net of costs 133,333 234,666 100 368,099
At 31 March 2023 2,860,150 3,484,915 107,204 (2,817,633) (7,383,481) 400,147 (3,348,698)
========== ========== ========= ============ ============ ============= ============
The rever se acq uisition reser ve was created in accordance
with IFRS3 ' Bu s i ness C o m bination s '. The reserve relates to
a reverse acquisition between the Company and Combe Bank Homes Ltd
(CBH) on 11/11/2011 via a share for share exchange. This reserve
arises as a result of the elimination of the Plc's investment in
CBH resulting in the shareholders of PLC becoming majority
shareholders in the enlarged group.
Retai ned pro fit/(l o sses) are the cumulative net gains and
losses less distributions made and items of other comprehensive
income not accumulated in another separate reserve.
Loan note equity reserve relates to the equity portion of the
convertible loan notes and is the amount that has been provided for
in respect of the difference between the cash value and the
liability element of the loan notes. An adjustment has been made of
GBP76,901 which is the amount provided for to 31 March 2023.
Capital contribution reserve arises due to amounts waived in
respect of previously accrued interest on shareholders or related
party loan accounts. . Capital contribution reserves are shown in
note 17.
Further details of shares issues in the year are shown in note
14,
T he n otes on p a ges 32 to 44 are an inte g ral part of these
co ns olidated f i n a ncial stat e ments.
2023 2022
GBP GBP
Ca sh flow f r om operating activities
( L o ss) a fter taxation (843,626) (486,336)
Dep reciation 284 379
(Increase) Decrea se in i nv e nto ry (321,889) 52,954
Decrease (Increase) in receivables 6,467 (7,045)
Increase (Decrease) in p a yables 95,001 (53,958)
Loss on disposal 12,382 22,500
Inventory written-off 29,750 -
Property revaluation 122,751 (112,000)
Loan note equity movement 157,066 58,953
I nterest p a yable and s i m ilar char
ges 123,848 171,714
--------------- ------------
Net ca sh outflow from opera ting activities (617,966) (352,839)
--------------- ------------
Investing activities:
Disposal/(P u rchase) of investment property 649,618 352,500
Purchase of equipment (25,000)
--------------- ------------
624,618 352,500
--------------- ------------
Financing activities:
I ssue of shar es (net of costs) 368,100 -
New lo an borro w i n gs 105,116 -
Repaid loan borro w i n gs (270,191) -
Related par ty n ew lo an borr o w i ng 188,153 297,500
Related par ty loan rep a yment (259,752) (452,758)
Rep a yment of other borro win gs (90,000) (9,583)
I nterest paid (43,683) (68,260)
Net cash (outflow) from financing (2,257) (233,101)
--------------- ------------
(Decrea se)/increase in ca sh and ca sh
equivalents in the year 4,395 (233,440)
--------------- ------------
Ca sh and ca sh equivalents at the beginning
of the year 12,753 246,193
--------------- ------------
Ca sh and ca sh equivalents at the end
of the year 17,148 12,753
=============== ============
T he n otes on pages 32 to 44 are an integ ral part of th e se
co n s olidated fin a ncial state m e nts.
B ASIS OF A C COUNT ING
T hese f i nancial state m e nts are f or T rafalgar P rop e rty
Gro up Plc ( "the C o m pan y") a nd its s u b sidiary un derta k i
n gs ( 'the Gro u p ' ). T he C o m pany is a p u blic co m pan y,
li mited by s hares a nd incorporated in En gla nd and Wales. (Co m
p a ny nu m ber is 0 4 3 4012 5 ). The C o m pan y 's registe r ed
o ffice is C h e q u e rs B a r n, Chequers Hill, Bou gh Bee c h,
Eden brid ge, Kent, TN8 7 PD.
T he natu re of t he Gro u p's operatio ns and its principal
activities are set o ut in the Strategic Report on page 4-7.
B ASIS OF P REP A R A T ION
T he Gr o up f i n a ncial state m e n ts h a ve b een prepared
in accor da nce w ith I n ter natio n al Fi n a n cial Repo rti ng
Stan dards as adopted in the United Kingdom ("UK adopted IFRS") and
those parts of the Companies Act 2006 that are relevant to
companies which report in accordance with IFRS. T hese f i nancial
state men ts are f or the year en ded 31 March 2 0 23 and are
presented in po un ds sterling ( "GB P") rounded to the nearest
pound. T he co m parative year is f or the year to 31 Mar ch
2022.
T he finan cial state m e nts have been prep a red un der the
his t orical co st co nvention and on an accrual method of
accounting, except for certain financial assets and liabilities
which are measured at fair value as explained in the accounting
policies below.
AUDIT EXEMPTION OF SUBSIDIARIES
T he following subsidiaries are exempt from the requirements of
the UK Companies Act 2006 relating to the audit of individual
accounts by virtue of s479A of the Act.
Company name Registered number
Trafalgar New Homes Ltd 06003791
Trafalgar Retirement+ Ltd 10431083
Selmat Ltd 09428992
Combe Homes (Borough Green) Ltd 08965850
Combe Bank Homes (Oakhurst) Ltd 07532693
Life Hydroponic Assets Ltd 14437592
The outstanding liabilities at 31 March 2023 of the above named
subsidiaries have been guaranteed by the Company pursuant to s479AC
of the Act. In the opinion of the directors, the possibility of the
guarantees being called upon is remote.
GOI NG CONCERN
T he Di recto rs have reviewed f or eca sts and b u d gets f or
t he co ming year, w hich have been d rawn up with app r op riate
regard f or the cu r rent ec o n o mic env i r o n ment and the
particu lar ci rcu m stan ces in w hich the Gr o up o p e rates.
These were p r e p a red with reference to his t o rical and cu r
rent in d us t ry kn o wled ge, taking into acc o unt f utu re s t
r ategy of the Gr o up.
During the year the Company raised GBP400,000 for working
capital purposes by way of an issue of 133,333,333 shares at 0.3p
per share and re-organised the loans with C C Johnson for a further
two years.
As indicated in note 20 subsequent to the balance sheet date,
the Company has raised GBP125,000 for working capital purposes by
way of an issue of 125,000,000 shares at 0.1p per share.
The total amount of loans remaining in the Group following the
sale of the investment property during the year amounts to
GBP4,447,914 (2022 - GBP4,694,421) as shown in note 13. At the date
of the audit report the final investment property had been sold and
from the sale proceeds a total of GBP851,698 was repaid to clear
part of the loans outstanding. Of the balance of the loans
remaining outstanding of GBP3,596,216, a sum of GBP3,299,800
relates to loans owed to C Johnson, plus connected parties, a
director of subsidiary companies. The balance of amounts owed were
to independent third parties.
T he Gr o up co n tinues to utilise banking s o u rces f or the
fin a ncing of its devel o p ments, t ogether with significant
loans fr om third party investo r s as stated in note 13, which is
after the disposal of its investment properties, to en s u re that
there is su fficient m o ney available f or the Gr o up to under
take and co m plete its var i o us devel op ments.
T he Gr o up does n ot operate an o v e r d raft facility b ut b
o rr ow on a site specif ic basis fr om var i o us banker s, with a
mix of loans f rom o uts i de in vest o rs gea r ed to s o me of
the devel o p ment p r o p e rties and oth e r wise loan ed on a
gener al basis to the Gr o up.
T he B o a rd is co m f or table with the s t r uctu re of its
bank finance, w hich usually inv olves the bank len ding a m odest
s um to wards the land p u rchase f or the m o dest s ized resi
dential devel op ment schemes, with the Gr o up p utting up the
rest of the f un ds r e q u i r ed to acq u i re the site and the c
o sts ass o ciated with the acq uisition and then f or the bank to
p r o v i de 10 0% of the b u ild finance.
The site at Speldhurst is due for completion by the end of 2023
with a sale expected in quarter one of 2024. This sale will then
make additional funds available to the group.
Ho wever, given th at a deg ree of unce r tainty exists in the
timing of f utu re sales, and management's ability to refinan ce
all l oans d ue in the next twelve m o nths, there e xists a mater
ial unce r tainty in relati on to the going co n cern basis a d o
pted in the p reparati on of the financial state ments.
REVENUE RECOGNITION
Rev e n ue represents t he a m ou nts receivable f r om the
investment in residential property during t he year and other inco
me directly ass ociated with property dev elop m e nt. This will
take the form of rental income and sales of investment
property.
Rental income is recognized at the point of receipt being the
contractual date in accordance with the tenancy agreements.
Revenue from customers arising from the sales of development
property are recognized at the transaction price which reflects the
amount of consideration that is expected to be received, and is
recognized at a point in time when ownership passes to the
customer, which in t he maj ority of ca ses is the point of legal
completion of the property sale and are shown in the accounts by
way of a profit/(loss) on disposal.
T he Directors are of the opinion th at t his accou nti ng
policy ac c u rately r e flects co m mercial reality and the
recording of r e ven ue f or the G ro u p.
ST ANDARDS ISSUED BUT NOT YET EFFEC T IVE
The following new standards or amendments to existing standards
were applicable for the first time and have not had an impact on
the financial statements.
New standards, interpretations and amendments
Amendments to IFRS 16, Lease liability in a Sale and
Leaseback
Lease Liability in a Sale and Leaseback (Amendments to IFRS 16)
requires a seller-lessee to subsequently measure lease liabilities
arising from a leaseback in a way that it does not recognise any
amount of the gain or loss that relates to the right of use it
retains. The new requirements do not prevent a seller-lessee from
recognising in profit or loss any gain or loss relating to the
partial or full termination of a lease.
The Group does not expect a material impact on its consolidated
financial statements from these amendments.
The Group adopt early the following amendments to standards
which are not yet mandatory.
Amendments to IAS 1 Presentation of Financial Statements:
Classification of Liabilities as Current or Non-current (issued
January 2020)
The amendments clarify that the classification of a liability as
current or non-current is based only on rights existing at the end
of the reporting period and the classification is not affected by
expectations about whether rights to settle or defer a liability
will be exercised. Further, the amendments clarify that the
settlement of a liability refers to the transfer of cash,
convertible debts, other assets, or services to the counterparty.
This amendment only affects presentation.
The amendment is effective for financial years beginning on or
after 1 January 2024 and has not yet been adopted for use in the
United Kingdom.
The Group does not expect a material impact on its consolidated
financial statements from these amendments.
Adoption of the following standards does not have an impact on
the consolidated financial statement of the Group:
Amendments to IFRS 3 - References to the conceptual framework
(issued in May 2020)
The amendments change references and cross-references from IFRS
3 to the Framework for the Preparation and Presentation of
Financial Statements.
The amendment is effective for financial years beginning on or
after 1 January 2022.
The Group does not expect a material impact on its consolidated
financial statements from these amendments.
Amendments to IAS 16 Property, Plant and Equipment (issued in
May 2020)
The amendments require any proceeds from selling items produced
(and related production costs) in the course of bringing an item
property, plant and equipment into operation to be recognised in
profit or loss clarifying that such items are not reflected in the
cost of the asset.
The amendment is effective for financial years beginning on or
after 1 January 2022.
The Group does not expect a material impact on its consolidated
financial statements from these amendments.
Amendments to IAS 37 Provisions, Contingent Liabilities and
Contingent Assets (issued in May 2020)
The amendments clarify that the cost of fulfilling a contract
are costs that relate directly to
that contract. Such costs can be the incremental costs of
fulfilling that contract or an allocation of other costs directly
related to fulfilling that contract.
The amendment is effective for financial years beginning on or
after 1 January 2022.
The Group does not expect a material impact on its consolidated
financial statements from these amendments.
Amendments to IAS 1 and IFRS Practice Statement - Disclosure of
Accounting policies (issued in February 2021)
The amendments enhance the disclosure requirements relating to
an entity's accounting policies and clarify that the notes to a
complete set of financial statements are required to include
material accounting policy information. Material accounting policy
information, when considered with other information included in the
financial statements, can reasonably be expected to influence
decisions that the primary users of financial statements make on
the basis of the financial statements. The amendments help
preparers determine what constitutes material accounting policy
information and notes that accounting policy information which
focuses on how IFRS has been applied to its own circumstances is
more useful for users of financial statements than standardised
information or information duplicating the requirements of
IFRS.
The amendment also states that immaterial accounting policy
information need not be disclosed but when it is disclosed it shall
not obscure material accounting policy information. Further, if
accounting policy information is not deemed material this does not
affect the materiality of related disclosure requirements of
IFRS.
The disclosure of judgements made in applying accounting
policies should reflect those that have had the most significant
effect on items recognised in the financial statements.
The amendment is effective for financial years beginning on or
after 1 January 2023 and has not yet been adopted for use in the
United Kingdom.
The Group does not expect a material impact on its consolidated
financial statements from these amendments.
Amendments to IAS 8 - Definition of Accounting Estimates (issued
in February 2021)
The amendments introduce a new definition of accounting
estimates and also clarify the distinction between changes in
accounting estimates, changes in accounting policies and the
correction of errors.
The amendment is effective for financial years beginning on or
after 1 January 2023 and has not yet been adopted for use in the
United Kingdom.
The Group does not expect a material impact on its consolidated
financial statements from these amendments.
Amendments to IAS 12 Deferred Tax related to Assets and
Liabilities arising from a Single Transaction (issued 7 May
2021)
The amendments specify how companies should account for deferred
tax on transactions such as leases and decommissioning
obligations.
In specified circumstances, companies are exempt from
recognising deferred tax when they recognise assets or liabilities
for the first time. Previously, there had been some uncertainty
about whether the exemption applied to transactions such as leases
and decommissioning obligations-transactions for which companies
recognise both an asset and a liability.
The amendments clarify that the exemption does not apply and
that companies are required to recognise deferred tax on such
transactions. The aim of the amendments is to reduce diversity in
the reporting of deferred tax on leases and decommissioning
obligations.
The amendments are effective for financial years beginning on or
after 1 January 2023 and have not yet been adopted for use in the
United Kingdom.
The Group does not expect a material impact on its consolidated
financial statements from these amendments.
Annual Improvements to IFRS Standards 2018-2020 (Issued May
2020)
The improvements to IFRS address the following:
-- Amendments to IFRS 1 - a subsidiary which adopts IFRS for the
first time may elect, in its financial statements, to measure
cumulative translation differences for all foreign operations at
the carrying amount that would be included in the parent's
consolidated financial statements, based on the parent's date of
transition to IFRSs if no adjustments were made for consolidation
procedures and for the effects of the business combination in which
the parent acquired the subsidiary. A similar election is available
to an associate or joint venture.
-- Amendments to IFRS 9 - in regard to the derecognition of
financial liabilities, the amendment to IFRS 9 clarifies that when
undertaking the 10% derecognition test that in the determination of
fees paid net of fees received, a borrower includes only fees paid
or received between the borrower and the lender, including fees
paid or received by either the borrower or lender on the other's
behalf.
-- Amendments to IAS 41 - the amendment clarifies that when
determining fair value of a biological asset an entity does not
include any cash flows for financing the assets, taxation, or
re-establishing biological assets after harvest (for example, the
cost of replanting trees in a plantation forest after harvest).
-- Amendments to IFRS 16 - the amendments make one of the worked
examples in the application guidance clearer to follow.
The amendment is effective for financial years beginning on or
after 1 January 2022.
The Group does not expect a material impact on its consolidated
financial statements from these amendments.
Business Combination
On the acquisition of a subsidiary, the business combination is
accounted for using the acquisition method. The cost of an
acquisition is measured as the aggregated amount of the fair value
of the consideration transferred, measured at the date of
acquisition. The consideration paid is allocated to the assets
acquired and liabilities (including contingent liabilities) assumed
on the basis of fair values at the date of acquisition. Acquisition
costs are expensed when incurred and included in general and
administrative expenses.
B ASIS OF CONSO L I D A T ION
T he co ns olidated fin a ncial stat e ments i ncorporate the
fin a ncial state men ts of t he company and its s u b sidiarie
s.
T he results of s u b sidiaries ac q uired d u ring t he year
are in clu ded f r om the date of acq u i s itio n, being t he date
on w hich the Gro up obtains co ntr ol. T h ey are deco ns olidated
on the date t hat co ntrol cea ses.
W hen t he Gr o up ceases to h a ve co ntrol or s i g n i fica
nt i n fluence, any retai ned i nterest in t he e ntity is r e mea
su red to its f air val ue, with t he c h a nge in car r ying a m
ou nt recog nised in pro fit or lo ss. T he fair value is t he i
nitial carr y i ng a m o unt f or the p u r po ses of su b seq uen
tly accou nti ng f or the retained interest as an ass ociate, j
oint ven t u re or f i nancial as set. In addition, any a m o un ts
prev i o us ly recog nised in other co m pr e h e ns i ve i nco me
in respect of that entity are acco unted f or as if t he Gro up had
directly dis po sed of t he related assets or liabilities. T his m
ay mean t he a m o u nts previo us ly recog nised in o t h er co m
pr e hen sive i nco me are reclass i fied to pro fit or lo ss.
C o ntrol is ac hieved w hen t he Company:
-- has the p o wer o ver the i n vestee;
-- is ex po sed or his rig hts, to variable retu r ns f r om its
involv e m e nt with t he in v e stee; and
-- has the ability to u se its po wer to af fect its ret u rn s.
FUNC T ION AL C U RREN CY
Ite ms i nclu ded in the fin a ncial state m e nts of ea ch of
the Gro u p 's entities are mea s u red u sing t he cu rren cy of
the primary eco n o mic en vironment in w hich t he en tity
operates ( ' t he fu nctio n al cu rren c y ' ). T he co ns
olidated f i nancial state men ts are presented in P o un ds Sterli
ng ( GBP ), w hich is the C o m pan y 's fu n ctio nal and the Gro
u p's presentation c u rren c y.
In preparing these financial statements, transactions in
currencies other than the Company and Group's presentational
currency ("foreign currencies") are recorded at the rates of
exchange prevailing on the dates of the transaction. At each
statement of financial position date, monetary items in foreign
currencies are translated into the presentational currency at the
exchange rate prevailing at statement of financial position
date.
Exchange differences arising on the settlements of monetary
items and on the retranslation of monetary items are included in
the consolidated statement of comprehensive income for the
year.
DEFINED CONT R IBUT ION PENSION P LAN
T he Gro up operates a defined co ntrib ution plan f or its e m
p l o yee s. A d e fined co ntrib ution plan is a pen sion plan un
der w hich t he Gro up p a ys f i xed co ntributio ns i nto a
separate entit y. Once the co ntributi o ns have been paid t he Gro
up has no f u r t her p a ymen ts obligation s.
T he co ntrib utio ns are reco gn i sed as an ex pen se in t he
profit or loss w h en t h ey fall d u e. Am ou n ts n ot paid are
sh o wn in accr uals as a liability in t he State m e nt of Fi nan
cial P o sition. T he assets of t he plan are held separately f r
om t he Gro up in i n depen dently ad m i nistered fu n ds
FINANCIAL INST RUMENTS
T he C o m pany recog n i ses f i n a ncial i n stru m e nts w h
en it bec o m es a par ty to t he co ntractual arrang e m e nts of
the instr u ment. Fi nan cial i nstr uments are d e - recog nised w
h en th ey are dis c har ged or w h en t he contractual term ex
pire. T he C o m p a n y 's accou nti ng policies in respect of f i
nancial i nstr u m e n ts tran sactions are ex plained belo w: Fin
a ncial as sets a nd f i n a ncial liabilities are in itially mea
su r ed at fair value.
Financial a ssets:
All recog n i sed f i nan cial as sets, including trade and
other receivables, are initially recognized at the transaction
price and su b seq u e ntly mea s u red at a m ortised co st using
the effective interest rate method.
Debt in str uments at amo rtised co st
Debt instr u m e n ts are su b seq uen tly mea s u red at a m
ortised co st w here th ey are fin a ncial assets held within a b
us i ness m odel w h o se ob jecti ve is to h old f i nan cial as
sets in order to collect co ntractual ca sh flo ws a nd selli ng
the f i nan cial a sset s, a nd the co ntractu al ter ms of the f i
n a ncial ass et give rise on s pecified dates to ca sh flo ws t
hat are s olely p a ym e nts of prin c i pal and inter e st on t he
pr i nci pal a m ou nt outsta n din g. Am o rtised c o st is
calculated us i ng the ef fecti ve inter e st m eth od and
represents the a m ou nt mea su red at initial recog nition less
rep a y m e n ts of principal plus the cu m ulati ve a m ortisation
us i ng t he e ffective i nterest meth od of any difference bet
ween t he initial a m ou nt a nd the mat u rity a m o unt, ad j
usted f or any lo ss allo w a nce.
Tr ade payables
T r a de payables are i nitially mea s u red at f air val ue a
nd are su b seq uen tly mea su red at a m or tised co st, us i ng
the ef fective i nterest rate met h od.
Convertible loan notes
Convertible loan notes are regarded as compound instruments,
consisting of a liability component and an equity component. At the
date of issue, the fair value of the liability component is
estimated using the prevailing market interest rate for similar
non-convertible debt. The difference between the proceeds of issue
of the convertible loan notes and the fair value assigned to the
liability component, representing the embedded option to convert
the liability into equity of the Group, is included in equity.
Issue costs are apportioned between the liability and equity
components of the convertible loan notes based on their relative
carrying amounts at the date of issue. The portion relating to the
equity component is charged directly against equity. The interest
expense on the liability component is calculated by applying the
prevailing market interest rate for similar non-convertible debt to
the liability component of the instrument. The difference between
this amount and the interest paid is added to the carrying amount
of the convertible loan note.
Sha re capital
Ordinary s hare capital is clas sified as eq u it y. I nter im
ordinary divid e n ds are reco gnis ed w h en paid and final
ordinary d i viden ds are reco g n i sed as a liability in t he
year in w hich th ey are appro ved.
Deferred shares were created as part of a subdivision of shares
but carry no voting rights and no right to participate in the
profits of the company.
Impairment of financi al a ssets
IFRS 9 offers two approaches for measuring and recognizing the
loss allowance: General and Simplified. The general approach should
be applied for all financial assets subject to impairment, except
for trade receivables or contract assets (IFRS 15) without
significant financing component, for these assets simplified
approach should be applied. The Group's financial instruments
measured at amortised cost falling within the scope of the standard
are (i) trade and other receivables and (ii) cash and cash
equivalents. While cash and cash equivalents are also subject to
the impairment requirements of IFRS 9, the identified impairment
loss was immaterial.
Trade and other receivables
The Group applies the IFRS 9 Simplified approach, by recognising
a loss allowance based on a lifetime expected credit loss ("ECL")
at each reporting date.
Financial liabilities:
At a m ortised co st
Fin a ncial liabilities w hich are neit her co ntin g e nt co
nsiderati on of an acq uirer in a b usiness co m b i natio n, held
f or trading, n or designated as at fair value th rough pro fit or
lo ss are su b seq uently mea su red at a m ortised co st us i ng
the ef fecti ve inter e st met h od. T his is a met h od of
calculati ng t he a m ortised co st of a f i nancial liability a nd
of allocating interest ex p e nse over the relev a nt period. T he
ef fecti ve interest rate is t he rate that exactly d i scou nts
esti mated f utu re ca sh paym e n ts th rou gh t he ex pected life
of the f i n a ncial liabilit y, or w here app r opriate a sh orter
period, to the a m ortised co st of a f i n a ncial liabilit y.
Dereco gnition of fin a ncial lia bilities
T he Co m pany de-recog nis e f i nancial liabilities w hen, and
o n ly w h e n, the Co m pan y's obligations are dischar ged, ca
ncelled or th ey e x pire.
C ASH AND CASH EQUI VALENTS
Cash and ca sh eq u i vale nts co m pr i se ca sh balances and
depo sits held at call with ban ks with matu rities of th ree m o n
t hs or less f r om i nceptio n.
INVENTOR IES
I nv e ntories co ns i st of the original acquisition of land
for development, including costs associated with planning, and
properties un der con struction a nd are stated at t he lo wer of
co st and net reali sable value. C o st co m pr i ses direct
materials an d, w here applicable, direct labo ur co sts a nd t h o
se o v e r heads th at h a ve been incu rred in brin ging t he i n
v e ntories to t heir present locati on and co n ditio n. I nter e
st on s u ms borr o wed t hat f i nance s pec i fic pro jects is
added to co st. Net realisable value represents t he esti mated
selling price less all esti mated co sts of co m pletion and co sts
to be incu rred in m a r ketin g, selling and distrib utio n.
P ROPER TY P LANT AND EQUI PMENT
P r o perty, pla nt a nd eq uip m e nt are stated at co st, less
accumulated depreciation and accumulated impairment. Dep reciation
is calc ulated to w rite d o wn the co st less e sti mated residual
val ue of all ta ngible f i xed ass ets us i ng the red uci ng bala
nce met h od o ver their ex pected u s e f ul eco no mic liv e s. T
he rates generally applicable are:
Fix t u res, fittin gs and eq uip m e nt - 25% on red uci ng
balance
Any gain or loss on disposal of an item of property, plant and
equipment is recognised in profit or loss.
INVESTME NT P ROPE R TY
I nv e s t m e nt proper t y, w hich is property held to earn r
e ntals an d/or f or capital appreciation (incl u d i ng proper ty
un der co nstr uction f or su ch p u rpo ses), is mea s u red
initially at co st, incl u ding tran saction co sts. S u b seq u e
nt to initial recog nition, i nv e s t ment property is mea su red
at f air value. Gai ns or lo s ses ar i s i ng f r om c han ges in
t he fair value of in vest m e nt property a re inclu ded in pro
fit or lo ss in the period in w hich th ey arise."
FINANCIAL L I A BI L I T IES & CONVERTIBLE DEBT
Fin a ncial liabilities a nd convertible debt is sued by t he G
ro up are classified according to the s u b sta nce of t he co
ntractual arran g e m e n ts ente red into and the definitions of a
fin a ncial liability and convertible debt i nstr u ment. The
current Convertible debts are accounted for as having both a debt
and an equity element. The difference between the loan note value
received by the company and the fair value of a debt only
instrument with imputed interest rate and with a final settlement
figure is recognized under loan note equity reserve account at the
point of issue. This loan note equity reserve has a 10% imputed
interest rate as managements' best estimate as to the interest rate
that would be expected from the market for an unsecured loan
without a conversion element. Convertible debt consists of
unsecured loan notes convertible, totaling GBP905,000 (2022:
GBP905,000) in full, into 226,250,000 ordinary shares at 0.4p per
ordinary share and can be convertible at any time by Mr. C C
Johnson for two years from July 2022, further details are provided
within note 13.
BORROW ING COSTS
Bor r o wing co sts directly attri b utable to the acq uisitio
n, co nstr uction or prod uction of q uali f ying ass ets, w hich
are assets that take a s u b stantial period of ti me to be co m
pleted f or sale, are added to the co st of property held as
inventory at t he year e n d. All other borro w i ng co s ts are
recog n i sed in t he profit or loss in t he year in w hich th ey
relate.
CUR RENT AND DEFER R ED T AXA T ION
Cu rrent tax a ssets and liabilities f or the c u rrent a nd
prior years are mea s u red at the a m o u nt e x pected to be reco
vered f rom or paid to the tax au t h orities. T he tax rates and
the tax la ws u sed to co m p ute t he a m o u nt are th o se t hat
are enacted or su b s tanti vely e nacted, by the reporting
date.
T he tax ex pense represe nts t he s um of t he tax c u rrently
p a y a ble and deferred tax.
T he t ax c u r r e n tly p a y ab le is ba s ed on t a x ab le
p r o f it f or t he y ear. Ta x ab le p ro f it d i ff ers f rom n
et pro f it as re po r t ed in t he i n c o me st a te m e nt b eca
u se it e x c l u d es it e ms of i n c o me or e x p e nse t h at
are t a x a b le or ded u c ti b le in o t her y e ars a nd it f u
r t h er e x c l u d es it e ms t h at are n e ver t a x ab le or
ded u c ti b l e. T he G ro u p 's liab ility f or c u r re nt tax
is ca lculated u si ng tax rat es and tax laws t hat have b een e
nacted or s u b sta n ti v e ly e nacted at t he r e p o rting
date.
Deferred tax is the tax e x pected to be payable or reco ver a
ble on differ e nces bet ween t he carr y i ng a m o u nts of
assets and liabilities in the f i nancial state m e n ts a nd the c
orrespo n ding tax bases u sed in t he co m p utation of t a x ab
le pr o f it. D e f er r ed t ax l i ab i l i ti es a re generally
reco gn i sed f or all taxable te mporary differences and deferred
tax assets are reco g nised to the extent t hat it is probable that
taxable pro fits w ill be available again st w hich ded uctible te
m porary differ e nces can be utilised. S uch assets and
liabilities are n ot r eco gnis ed if the tem po ra ry differen ce
a rises fr om g ood w ill or f rom the initial recognition
(other th an in a b usin e ss co m b i natio n) of other assets
and liabilities in a transac tion t hat af fec ts neit her the tax
pro fit n or the acco un ting pro fit.
T he car r y i ng a m o unt of d e fer red tax a s s e ts is re
v i e w ed at each repor ti ng d ate a nd red uced to the e x t e
nt t h at it is no lo nger p robable t hat s uf ficie nt ta x a b
le pr o f its w ill be a v ailab le to allow all or p a rt of t he
asset to be reco vered.
De ferred t ax is calc ulated at t he t ax rates and tax laws
that have been enacted or substantively enacted at the reporting
date t hat are e x pected to a pp ly in t he y ear w h en t he
liability is settled or t he a sset is r eali sed. De fer red tax
is c har ged or credited in pr o fit or lo s s, e x cept w hen it r
elates to ite ms char ged or cr e d ited directly to o t her co m
pr e h e n s i ve i nco m e, in w h i ch case t he d e ferred tax
is a l so d ealt w ith in other co m prehen s i ve inco me.
P ROV I S IONS
P ro v i si o ns are rec o g n i s ed w h en t he G r o up h as
a pr e s e nt ob l i g a ti on ( l e g al or con st r uc t i v e)
as a r e s u lt of a pa st e vent a nd it is probab le t h at an o
u t f l ow of re s o u r ces e m bo d y i ng e co n o m ic b e n e
f i ts wi ll be re q u i red to s e t tle t he ob l i g a ti on a
nd a r e li ab le e s ti m a te c an be m a de of t he a m o unt of
t he o b l i g a t i o n. W h ere t he G r o up e x p e c ts s o me
or a ll of a pr o v isi on to be r e i m b u r s ed, t he r e i m b
u r s e m e nt is rec o gn i s ed as a s epar a te a s s et b ut o
n ly wh en t he re i m b u r s e m e nt is v i r t ua lly ce r t a
i n. T he e xpen se r e l a ti ng to a ny prov i si on is pr e s e
n t ed in t he i nc o me st a t e m e nt n et of a ny re i m b u r
s e m e n t. If t he e f f ect of t he ti me v a l ue of m o n ey
is m a t er i a l, pr o v i si o ns are d i s coun t ed usi ng a c
u rr e nt pr e - t ax r a te t h at r e f l e c t s, wh e re
appropr i a t e, t he r i s ks s pec i f ic to t he l i ab i li t
y. W h ere d i s c o u n t i ng is u s ed, t he i n c r ea se in t
he pr o v i si on d ue to t he p a s s a ge of t i me is rec o g n
i s ed as a borr owi ng co s t.
C O MMI T ME N TS AND C O N T I NG E N C I ES
C o m m i t m e n ts a nd c o n ti n g e nt l i ab i li t i es
are d i s c l o s ed in t he f i n a n c i al s t a t e m e n t s.
T h ey a re d i s c l o s ed u n l e ss t he po s si b i l ity of
an o u t f l ow of r e s o u rc es e m bo d y i ng ec o n o m ic
ben e f i ts is r e m o t e. A co n ti n g e nt a s s et is n ot
recogn i s ed in t he f i n a n c i al st a t e m e n ts b ut d i s
c l o s ed wh en an i n f l ow of ec o n o m ic b e n e f i ts is v
i r t u a l ly c er t a i n.
C R I T I C AL A CC O UN T I NG J U DG M E N TS A ND K EY S O U
R C ES OF E S T I M A T I ON AND UN C E R TAINTY
T he pr e paration of fin a ncial s tate m e nts in con f o r
mity with law & United Kingdom adopted International Financial
Reporting Standards (UK adopted IFRS) and IFRS in conformity with
the requirements of the Companies Act 2006 req uires t he use of
certain critical acco unti ng esti mates. It also req uires m a n a
g e m e nt to exercise its j u dg m e nt in the proce ss of apply i
ng t he Gro u p 's accou nti ng policies. T he areas inv olv i ng a
hig her deg ree of j u d g m e nt or co m plexit y, or areas w here
assu m ptio ns a nd esti mates are sig ni ficant to the Gro up f i
n a ncial state men ts are disclo sed belo w.
Esti m ates and j u dg ments are co ntin ually e val uated and
are based on historical ex perience and other factor s, incl u ding
ex pectatio ns of f u t ure events t hat are believed to be rea s o
nable un der the prese nt circu mstance s.
Valuation of Inventory
T he Gro up assesses the net r ealisable val ue of i n ventories
u n der develo p ment a nd co m pleted pr o perties held f or sale
according to their recoverable a m ou nts based on t he
realisability of t hese proper t ies, ta king into accou nt esti
mated co sts to co m pletion based on past ex perience and co
mmitted co ntracts and esti mated net sales based on prevailing mar
ket co n ditio ns. P ro vision is made w hen e ven ts or chan ges
in cir c u msta nces i n dicate that the carr y i ng a m ou nts m
ay n ot be realised. T he carr ying val ue is red uced by its selli
ng price less co sts to co m plete and sell. T his written down
amount is recog n i sed i mmediate ly in profit or loss. T he
assess ment req uires t he use of j u dg ment a nd esti m ate s. T
he carr y i ng a m o u nt of in v e nto ry is disclo sed in n ote
11 to the f i n a ncial state m e nts.
Recognition of deferred tax a ssets
T he reco gnition of deferred tax assets is based u pon w het h
er it is m ore likely th an n ot that s u f ficient and s uitable
taxable pro fits will be available in the f utu re agai n st w hich
t he rever sal of te m por a ry d i ffer e nces can be ded ucted.
To deter m i ne the f utu re ta xable pro fits, r e ference is made
to the latest a v ailable pro fit f orecasts. W here the te m
porary differences are related to l o sses, relevant tax law is co
nsidered to d eter m i ne the av ailability of the lo s ses to of f
set a gai nst t he f u t u re taxable pro fits.
I mpair m ent of non financial a ssets
At ea ch state m e nt of f i n a ncial po sition date, the Co m
p a ny revie ws t he car r y i ng a m ounts of its tan gible and
inta ngible ass ets with f i nite li ves to deter m i ne w het her
t here is an i n dication t hat t h o se a ssets h a ve s u f fered
an i m pair m e nt lo ss. If a ny s u ch in dication e xis t s, t
he assets reco v e rable a m ou nt is esti mated in order to deter
mine t he exte nt of the i mpair m e nt lo ss (if a n y ). The
recoverable amount is the higher of (a) fair value less costs to
sell and (b) value in use.
If the reco verable a m o u nt of an ass et is esti mated to be
less than its car r y i ng a m o u nt, the carr y i ng a m o u nt
of t he asset is red uced to its reco verable a m ou nt. I m pair m
e nt lo s ses are recog nised as an ex pen se i m mediatel y, u
nless the relev a nt as set is la nd or buildings at a revalued a m
o u n t, in w hich ca se t he i m p air m e nt lo ss is treated as
a revaluation decrea se.
W here an i m pair m e nt lo ss s ub seq uently rever ses, t he
car r ying a m o unt of t he ass et is i ncrea sed to the revised
esti mate of its reco verable am o u nt, b ut so that t he incr
eased carr y i ng a m o unt does not exceed the car r y i ng a m ou
nt th at w o uld h a ve been deter mined had no i m pair m e nt lo
ss been reco gnised f or the asset in prior yea r s. A rever sal of
an i m pair m e nt lo ss is rec o g n i sed as inco me i m mediatel
y, u nless the rele vant as set is carried at a revalued a m o u
nt, in w hich ca se the rever sal of t he i m pair m e nt lo ss is
treated as a revalu ati on increa se.
1.
SEG M ENTAL R E P ORTI NG
For the p u rpo se of IFRS 8, the chief operating decision maker
( " CODM") tak es the f o rm of t he Board of Director s. T he
Director s' opinion of t he bu s i ness of the Gr o up is as f ollo
w s.
T he principal activity of t he Gro up is investment in
residential property.
Based on the abo ve co nsider atio ns, the Directors' co n sider
there to be o ne rep ortable geographical seg ment which is in the
UK T he inter nal and exter nal reporting is on a co n s olidated
basis with tran sactions between Gro up co m panies eli m i nated
on co ns olidatio n. T heref ore the fin a ncial in f o r mation of
the s i n gle seg m e nt is t he s a me as t hat set o ut in t he
co ns olidated state m e nt of co m prehen s i ve inco me, t he
consolidated state ment of changes in equity, t he consolidated
state m e nt of f i nancial po sition and ca s h flo w s. Therefore
no segmental reporting is required.
Revenue
An analysis of revenue is as follows:
2023 2022
GBP GBP
T he Gro u p 's reven ue, w hich is all attrib utable to their
p rinci pal activit y, can be shown as f oll o w s:
Rental Income 18,183 64,839
------- ----------
18,183 64,839
2023 2022
GBP GBP
Timing of Revenue are as follows:
Rental income transferred over time 18,183 64,839
------- ----------
18,183 64,839
2023 2022
GBP GBP
Revenues analysed by geographic location
are as follows:
United Kingdom 18,183 64,389
------- ----------
2. L OSS FOR T HE YEAR
Operating lo ss is stated after c har
g i ng/ (creditin g) t he f o llo w i
n g: 2023 2 0 22
GBP GBP
Su bco ntractor co sts and co st of in
v e ntories reco g nised as an ex pense 1,150 3,159
Write off of Inventory 29,750 -
----------------------- ------------------
30,900 3,159
Dep reciation of property, plant a nd
eq uip m e nt 284 379
----------------------- ------------------
Au ditor 's r e m u neration - au dit
ser vices - Gro up 31,750 25,650
Auditor's remuneration - other assurance
services - Group 4,750 5,000
----------------------- ------------------
36,500 30,650
Operating expenses by nature:
E m plo yee ex p e ns es 228,184 142,056
Dep reciation 284 379
Legal and professional fees 257,648 174,574
Other ex p e nses 85,812 142,646
------- -------
571,928 459,655
There are no operating expenses that generated a rental income
during the year.
3. E MPL OYEES AND DIRECTO RS' RE MUNERATI ON
Staff co s ts d u ring t he year were as f ollo w s:
2023 2022
GBP GBP
Wages and salaries 185,567 114,500
Social sec u rity co sts 20,627 6,796
Other pen sion co sts 21,990 20,760
------- --------------
228,184 142,056
------- --------------
T he average nu m ber of e m plo yees of t he Gro up d u r i ng
t he year was:
2023 2022
Nu mber Nu m ber
Directors 6 7
C C Johnson and A Johnson are directors
of subsidiary entities
Ma nag e m e nt 1 1
------- --------
Directors Remuneration w as as f ollo w s:
2023 2022
GBP GBP
- E m o l u men ts f or q uali f y i ng
ser vices J Dubois 8,333 7,500
* E m o l u men ts f or q uali f y i ng ser vices A J o
h n s on (director of subsidiary entity) 60,000 60,000
- Emoluments for qualifying services P
Treadaway 50,000 15,000
- Emoluments for qualifying services P 6,731 -
Challinor
- Emoluments for qualifying services N 3,333 -
Lott
- E m o l u men ts f or q uali f y i ng
ser vices G Thorneycroft 39,169 9,000
-------------- --------------
167,566 91,500
-------------- --------------
Highest paid director - gross salary including company pension
contributions was GBP61,800 (2022 - GBP61,800)
T here are retirem e nt ben e fits accr uing to Mr C C J o h n s
on (director of subsidiary entities) for w h om a Co m p a ny co
ntrib u tion w as paid d u ring the year of GBP18,000 ( 2 022: GBP
1 8,0 0 0), Mr A J o hns on (director of subsidiary entities)
GBP1,800(20 22: GBP1,800 ) and Mr G Thorneycroft GBP1,500 (2022:
GBP270).
C o n s ulta n cy fees of GBPNil ( 2 022: GBP2,500) were paid to
Mr N L ott d u r i ng t he year.
4. INTE R E ST PAYAB LE AND SI M ILAR CHAR G ES
For sites w here the co nstr ucti on had been co m pleted, the
bank loan inter e st paid during the year on these sites of GBP920
(2 0 22: GBPnil) has been accou nted f or in t he pro fit & lo
ss wit hin co st of sales. Total interest in the year of GBP86,451
(2022: GBP171,714) has been paid and accrued on general funding
loans, loan notes and on rental property mortgage loan. Further
details are provided in notes 13 and 15.
2023 2022
GBP GBP
C C Johnson - 25,000
DFM Pension Scheme (pension scheme for J
Dubois (former director)) 1,559 12,000
G Howard 10,000 29,500
C Rowe 584 4,500
S Johnson 198 10,331
Loan notes - C C Johnson 80,165 58,954
Paragon mortgage 30,422 31,429
Bank loan 920 -
123,848 171,714
======= =======
5. TAXATI ON
2023 2022
GBP GBP
Current tax - -
Tax charge - -
-------------- ------------------
UK corporation tax rate has been reviewed
upward to 25% effective April 2023
2023 2022
GBP GBP
( L o ss )/profit on ordinary activities
before tax (843,626) (486,336)
Based on (lo ss) f or the year:
Tax at 19% ( 20 22: 19%) (160,289) (92,403)
Un relie ved tax lo ss es - -
I m pair m e nt - -
Tax losses carried forward 160,289 92,403
-------------- ------------------
Tax ch a r ge f or the year - -
-------------- ------------------
Deferred tax
No deferred tax assets have been provided in respect of property
revaluation as there are h istorical lo sses upon w hich to o f f
set. As at t he 31 March 2023, the Gro up had cum ulati ve tax lo s
ses of GBP6,296,440 (2 0 22: GBP 5,453,582) that are available to o
ff s et a gain st f u t u re ta xable pro fits of the same
trade.
2023 2022
GBP GBP
Fair value movement on property revaluation (122,751) 112,000
Tax at 19% (23,323) 21,280
Tax losses available 23,323 (21,280)
--------- --------
Deferred tax f or the year - -
--------- --------
The UK Government announced in the 2021 budget that from 1 April
2023, the rate of corporation tax in the United Kingdom will
increase from 19% to 25%. Companies with profits of GBP50,000 or
less will continue to be taxed at 19%, which is a new small profits
rate. Where taxable profits are between GBP50,000 and GBP250,000,
the higher 25% rate will apply but with a marginal relief applying
as profits. UK corporation tax rate has been reviewed by the Group
as a result of this changes.
6. ( L OSS) PER ORDINARY SHARE
T he ca lculati on of ( l o ss ) / p r o fit per o r dinary
share is bas ed on the f o llo wing ( l o s ses) and the nu m ber
of shares used should be that retrospectively adjusted for the
effect of consolidation:
2023 2022
GBP GBP
( L o s s) f or the year (843,626) (486,336)
Weigh ted average nu m ber of s hares f
or basic ( l o ss) p er sh a re 249,525,835 142,519,038
Weigh ted average nu m ber of s hares f
or d iluted ( l o ss) p er s h a re 249,525,835 142,519,038
( Loss) per Ordinary Share:
Basic (0.34)p (0.34)p
Diluted (0.34)p (0.34)p
7. PROPERTY, PLANT AND E Q U IPM ENT
Plant a nd eq uip m e nt 2023 2022
GBP GBP
Co st
At 1 A pril 7,790 7,790
A dditions 25,000 -
-------------- --------------
At 31 March 32,790 7,790
Depreciation
At 1 A pril 6,653 6,274
Char ge f or the year 284 379
-------------- --------------
At 31 March 6,937 6,653
Net book value at 31 March 25,853 1,137
-------------- --------------
8. CURRENT ASSET: PRO P ERTIES
2023 2022
FAIR VALUE GBP GBP
As at 01 April 1,712,000 -
Additions - 1,975,000
Disposals (662,000) (375,000)
Fair Valuation Adjustment (122,751) 112,000
-------------- --------------
31 March 927,249 1,712,000
-------------- --------------
NET BOOK VALUE
-------------- --------------
As at 31 March 927,249 1,712,000
-------------- --------------
Fair Value at 31 March is represented b
y:
Revaluation in 2023 (2022: at revalued
amount) 927,249 1,712,000
Loss on Disposal:
Fair value 662,000 375,000
Disposal proceeds (net of costs) 649,618 352,500
-------------- --------------
Loss on Disposal 12,382 22,500
-------------- --------------
Fair value has been assessed by using level 3 fair value
hierarchy and using the selling price achieved following the sale
of one leasehold property in May 2022 of GBP337,000 and another
property sold in February 2023 of GBP325,000. The remaining
property was fair valued using the selling price achieved following
the sale in September 2023.
9. TRADE AND O TH ER RE C E IVAB L ES
2023 2022
GBP GBP
Other receivables 2,300 2,300
Other tax es 9,457 12,530
P repay m e nts 22,276 25,670
-------------- --------------
34,033 40,500
-------------- --------------
No IFRS9 provision has been recognized on the above financial
instruments on the basis that this provision has been deemed to be
immaterial
10. CASH AND CASH E QUIVA L ENTS
All of t he G r o u p 's ca sh a nd ca sh e q u i v a l e n ts
at year end are in S t er li ng and held at floati ng i nterest
rates.
2023 2022
GBP GBP
Cash and ca sh eq uivalents 17,148 12,753
---------- ----------
T he Directors co nsider that the carr y i ng a m ou nt of ca
sh a nd ca sh eq u i vale nts appro x i mate to their fair v alu
e.
11. INVENT ORY
2023 2022
GBP GBP
Work in progress 317,796 25,657
------- ------
Inventories recognised as an expense during the period totalled
GBPnil (2022: GBPnil). Borrowing costs capitalized in the year
total GBP6,393 (2022 - nil)
Write-down of inventories recognised as an expense in the period
totalled GBP29,750 (2022: GBPnil). This was due to the owners of
the Leatherhead site taking an alternative offer for their project
from an independent third party
Inventories pledged as security for liabilities as at the year
end totalled GBP275,000 (2022: GBPnil).
12. TRADE AND O T H ER PAYA BL ES
2023 2022
GBP GBP
T r a de payables 122,697 23,715
Taxation & s ocial sec u rity 14,211 5,378
Acc r uals 85,955 341,140
--------------- -------
222,863 370,233
--------------- -------
13. B ORROWINGS
2023 2022
GBP GBP
Director s' loans 3,086,949 3,038,382
Other loans 560,000 731,666
Bank loans - see u n der 800,965 924,3 73
-------------- --------------
4,447,914 4,694,421
-------------- --------------
Being:
Less than one year 874,697 869,697
More than one year 3,573,217 3,824,724
4,447,914 4,694,421
-------------- --------------
Di r ect or s' l oans included a sum of GBPnil ( 2 0 22:
GBP100,000) a d vanced by the DFM Pens i on Scheme of w hich Mr J
Dub ois was the p rincipal benef icia r y, which had been repaid
during the year. T his loan bore interest at 12% p er a nn um (20
22: 1 2% p er ann u m ).
Historic loan notes with a nominal value of GBP600,000 and
GBP200,000 respectively were rolled up in to a new convertible loan
note agreement in the year along with related party loans of
GBP105,000 to create a new convertible loan note with a nominal
value of GBP905,000. The liability in respect of this transaction
is disclosed within directors loans above with a present value as
at 31(st) March 2023 of GBP797,796 (2022: GBP769,697). Refer to
note 14 for further details. As a financial instrument with both
debt and equity components, an amount was recognised directly into
a Loan Note Equity Reserve on issue, as explained further in note
14, with the debt element being unwound at an implied interest rate
of 10% and the interest recognized through profit and loss.
T he remaining balance is discl o s ed in n ote 15 .
Included in other loans is GBP560,000 (2022: GBP600,000)
advanced by Mr G Howard (son-in-law to Mr C C Johnson to t he Co m
p a ny at rates of 10% & 5% per an num (20 22: 10% & 5% pa)
together with GBPnil (20 22: GBP 90,0 0 0) has been ad vanced by C
R o we, a former e m p l o yee of the Gro u p, at a rate of 5% per
ann u m. The balance relates to the Covid Loan. Details of the
negotiated loan interest reduction with Mr G Howard for accrued
interest are given in note 17.
Mrs S J o hns o n, wife of Mr C C J o hns on has a leg al char
ge on flats 3 & 5 Burnside Court Sandhurst Road, Tunbridge
Wells Kent of GBPnil (2022: GBP33,255) in connection with her loan
to Selmat. During the year the sum of GBP33,255 was repaid.
Selmat has also g ran ted to Pa rag on Mo rtgages a legal char
ge o v er the free h o ld p r o p e rty at Hil den b o r o ugh. The
m or t gage was in terest o nly, f or a te rm of seven years with a
fix ed interest r ate f or the f i r st five yea r s. The property
property had been rented out but was sold after the year end.
T he bank bo r r o wings are re p a yable
as f oll o w s: 2023 2022
GBP GBP
On d e m a nd or wit h in o ne year - -
In the sec o nd year - -
In the t hird to fifth years i nclu sive - -
After five years 800,965 924,373
-------------- --------
800,965 924,3 73
-------------- --------
Less a m o u nt d ue f or settle m e nt - -
wit h in twelve m o n t hs
-------------- --------
(included in current liabilities)
-------------- --------
Am ou nt d ue f or settle m e nt a f ter
twelve m o n t hs 800,965 924,373
-------------- --------
T he weighted av e rage in t e rest rates paid on the bank loans
were as f oll o w s: Bank loans: 3.4 % ( 2022: 3.4 %)
All of the Direc t o r s' loans a re r e payable after m ore
than 1 yea r with the exception of loan notes amounting to
GBP797,796 relating to Mr C C Johnson.. All l oans are inte r e st
bea ring and ch a r g ed ac c o r dingly. Ho wever Mr C C J o hn s
on has waived his rig ht to in terest in the year with the
exception of the first GBP 500,000 (2022: first GBP500,0000).
Interest of nil (2022: GBP25,000) has been accrued in the year. I n
terest of GBP 1,559 ( 20 22: GBP12 ,000) was paid to Mr J Dub ois
at the rate of 1 2% pa ( 2 0 22: 12% p a ).
14. SHARE CAPITAL
Issued allotted & paid share capital 2023 2022
Number Number
Ordinary shares
Ordinary shares of 0.1p in issue 142,519,038 142,519,038
Ordinary shares of 0.1p issued in year 133,333,333 -
------------ ------------
Total ordinary shares of 0.1p in issue 275,852,371 142,519,038
Deferred shares
Deferred shares of 0.9p in issue 287,144,228 287,144,228
Deferred shares of 0.9p arising in year - -
------------ ------------
Total Deferred shares of 0.9p in issue 287,144,228 287,144,228
Background - Ordinary shares, warrants and loan notes
On 10 June 2022, 133,333,333 ordinary shares of 0.1p each were
issued under a placing at 0.3p each (at a premium of 0.2p per
share) to raise GBP400,000 before costs of GBP32,000.
On the 31 July 2022 the Company agreed with Mr C C Johnson a
consolidation and variation of terms of the two unsecured
convertible loan notes and direct debt held by him. The conversion
of the total amount owed to him by the Company (GBP905,000) has
resulted in the issue to Mr C C Johnson of a new unsecured
conversation loan note for an aggregate amount of GBP905,000,
expiring 31 July 2024. This has replaced:
-- The GBP 600,000 unsecured convertible loan notes issued in
July 2020 which would have been redeemable on 31 July 2022 and
which were convertible at 2p per share (following the share
consolidation in December 2020) and carried the right upon a
conversion of the loan notes, to the grant of warrants to subscribe
for ordinary shares on a one to one basis, exercisable at the
conversion price of 2p for a period of two years from the date of
grant;
-- The GBP 200,000 unsecured convertible loan notes comprised in
the loan facility entered into in November 2021, which would have
been redeemable on 30 November 2022, and which were convertible at
0.7p per share;
-- GBP 105,0000 owed to him by the Company on directors' loan account.
The new unsecured convertible loan note is convertible in full
into 226,250,000 ordinary shares of 0.4p per ordinary share and can
be converted by Mr Johnson, subject inter alia to his entire
holding being less than 29.99 per cent of the voting rights in
issue in the Company.
The new unsecured convertible loan note carried the right upon a
conversion, to the grant of warrants to subscribe for ordinary
shares on a one for one basis, exercisable at the conversion price
for a period of two year from the date of grant.
Loan note equity reserve is the amount that has been provided
for in respect of the difference between the cash value and
liability element of the loan notes.
The convertible loan notes have been accounted for as having
both a debt and an equity element. This results in the creation of
a loan note equity reserve at the point of issue. This loan note
equity reserve is the difference between the loan note value
received by the company of GBP 905,000 (31 3 22: GBP800,000) and
the fair value of a debt only instrument with a 10% imputed
interest rate and a final settlement figure of GBP905,000 in July
2024. This 10% imputed interest rate of GBP80,165 (2022:
GBP33,058), is managements' best estimate as to the interest rate
that would be expected from the market for an unsecured loan of
GBP905,000 without a conversion element.
Deferred shares do not entitle the holder to receive notice of
and to attend or vote at any general meeting of the Company or to
receive dividends or other distributions. Upon winding up or
dissolution of the Company the holders of deferred shares shall be
entitled to receive an amount equal to the nominal amount paid up
thereon, but only after holders of ordinary shares have received
GBP100,000 per ordinary share. Holders of deferred shares are not
entitled to any further rights of participation in the assets of
the Company. The Company has the right to purchase the deferred
shares in issue at any time for no consideration.
Issued, all o t t ed and f ully p a id 2 023 2 022
GBP GBP
Ordin ary s h a res b/fwd 142,519 142,519
Deferred shares b/fwd 2,584,298 2,584,298
Issued in y e ar - ordin ary s h a res 133,333 -
Issued in year - deferred shares - -
---------- ------------
2 ,860,150 2 , 726,817
---------- ------------
For the purpose of preparing the consolidated financial
statement of the Group, share capital represents the nominal value
of the issued share capital of 0.1p per share (2022: 0.1p per
share). Share premium represents the excess over nominal value of
the fair value consideration received for equity shares net of
expenses plus deferred shares of 0.9p after issued share capital of
1p.
15. RELAT ED PAR TY TRANS ACT I ONS
Mr C C J o hns on, a subsidiary Director who served during the
year, h eld 18,681,580 ordinary 0.1p shares in t he Gro up as at 31
March 2 023 (2022 18,681,580 ordinary 0.1p).
Mr N Lott, who served as a Director during the year, held 50,000
ordinary 0.1p shares in the Group as at 31 March 2023 (2022: 50,000
ordinary 0.1p).
Mr P Trea daway who served as a Director during the year, held
19,733,466 ordinary 0.1p shares in the Group as at 31 March 2023
(2022: 19,733,466 ordinary 0.1p).
Mr G Thorneycroft who served as a Director during the year, held
600,000 ordinary 0.1p shares in the Group as at 31 March 2023
(2022: 600,000 ordinary 0.1p).
Fu rth er d etails relating to warrants can be found un d er n o
te 16.
T he f ollo w i ng w o r king capital loans h
a ve been pro vided by t he Director s: 2023 2022
GBP GBP
C C J o h n s on
Opening balances 2,938,382 3,002,865
L oan rep a ym e nts (63,255) (325,568)
Per s o nal drawin gs (19,587) (36,415)
Capital in jected 268,258 297,500
Balance carried forward 3,123,798 2,938,382
-------------- ----------------
J Dubois
Opening balances 100,000 150,000
L oan rep a ym e nts (100,000) (50,000)
-------------- ----------------
Balance carried forward - 100,000
-------------- ----------------
P Treadway
Opening balances - -
Drawn in year (36,849) -
-------------- ----------------
Balance carried forward (36,849) -
-------------- ----------------
Total Directors' Loan 3,086,949 3,038,382
============== ================
Mr J o hns on's L oan bore i nterest d u r i ng t he year at 5%
(2022: 5% pa), b ut he has c h o s en to f orego t he i nterest
(2022: exception first GBP 500,000 of capital upon which interest
is paid at 5%). Mr Johnson was due interest of GBP nil in the year
(2022: GBP25,000). Mr J o h n s on is no l o nger a Director of
Trafalgar Property Group Plc, but remains a director of other
entities to the Group and r e mai ns a shar e h older. Mr Du bois
's L oan, w hich is f r om his Pen sion Fu nd of w hich he is t he
s ole beneficiar y, was paid interest of GBP1,559 (2022: GBP12,000)
at 12% pa interest (2022: 1 2% pa). This loan was fully repaid on
16(th) May 2022.
Mrs S J o h n s o n, w i fe of Mr C C J o h n s on had
originally pro vided a l o an of GBP 380,000 (2022: GBP 380,000) to
Selmat, a subsidiary of the Group, which was reduced in the year to
GBPnil, (2022: GBP33,255) which bore inter e st of 5% pa, (2022: 5%
pa). T his has been i ncl u ded wit h in Mr C C J o hns on's loan
balance abo v e.
Mr. G. Howard (son-in-law to Mr. C C Johnson) had previously
advanced loans of GBP560,000 (2022: GBP600,000) to
t he Co m p a ny at rates of 10% & 5% per an num (20 22: 10% & 5% pa)
Du ring the year rents were p aid of GBP10,000 ( 2 022:
GBP10,000) to the C o m be Bank Ho mes Pension Scheme w hich o w ns
the f ree h o ld o ffices at Cheq u e rs B a r n. Mr C C J ohns on
is a Tr ustee and Beneficia ry of that Pens i on Scheme.
Du ring t he year p a ym e nts were made to Mr N Lott of GBPNil
(2022: GBP2,500) f or c o nsulta n cy services.
During the year payments amounting to GBP15,900 (2022: GBP4,250)
were made to Real Time Accounting Ltd for bookkeeping services.
Gary Thorneycroft is a majority shareholder and director of Real
Time Accounting Ltd.
During the year payments amounting to GBP12,000 (2022: nil) were
made to May Barn Horticultural Consultancy Ltd, for hydroponic
consultancy services, a company that Dr P Challinor was a director
and major shareholder. In addition a new company Life Hydroponic
Asset Ltd was incorporated in the year , which then acquired
hydroponic assets from Dr P Challinor for GBP25,000 (2022:
nil).
16. SHARE WARRANTS
Share warrants as at the year end relate to the convertible loan
note with Mr C C Johnson, details of this arrangement are given in
Note 14 to these accounts.
17. CAPITAL CONTRIBUTION RESERVE
The capital contribution reserve of GBP400,147 (2022:
GBP157,777) related to the renegotiation of interest accruing on
loans from Mr G Howard to below market rate terms. Interest was
reduced from 10% pa to 5% pa for the entire term of the loans and
is now non compound.
As Mr. G Howard is related to Mr. C C Johnson, a related party,
a Capital Reserve was created. In the current year, a further
provision of GBP242,370 was recognized as a result of Mr. Howard
waiving all interest due on the loan outstanding.
18. CATEG O R I ES OF FINANC IAL INS TRUM ENTS
All f i n a ncial i nstr u m e n ts are mea s u red un der IFRS
9 at a m ortised co st.
Capital risk m anag e ment
T he G ro up co n si ders its cap it al to comprise its s h are
cap it al a nd s h are pre m i u m. T he G ro u p 's cap it al m a
n a g e m e nt o b j ec ti v es a re to s a f e gu ard t he e n ti
t y 's ab ility to co n ti n ue as a g o i ng c o n cer n, so t h
at it can co n ti nue to pro v i de re t u r ns f or s h are h o l
d ers a nd be n e f its f or o t h er st a k e h o l ders a nd to
pro v i de an adeq u a te re t u rn to s h are h olders by pr ici
ng prod u c ts a nd ser v i c es c omm e n s u ra t e ly with t he
l e v el of r is k.
Significant Accoun ting Policies
De t a i ls of t he s i g n i f i c a nt a c c o u n t i ng po
li c i es a nd m e t h o ds a dop t e d, i n c l u d i ng t he c r
it er ia f or recog nition, the basis of mea su r e ment a nd the
basis on w hich inco me a nd ex pen ses are reco g nised, in res
pect of each class of f i n a ncial a s set, f i n a ncial
liability a nd convertible debt a re d isclo sed on p a g es 23 to
31 to these financial statements
Foreign currency risk
T he Gro up has min i m al ex p o su re to the differing t y p
es of f oreign c u rren cy ris k. It has no f oreign cu rren cy de
n o m i na t ed m o n e t a ry a s s e ts or li ab i l i ti es a nd
do es n ot ma ke s a l es or p u r c h a s es f r om o v e r s e as
c o u n t r ies.
Intere st rate risk
T he Gr o up is s e n s iti ve to ch a ng es in i nterest rates
w here i nterest is char ged on a variable rate basis. This risk
has been minimized by:
-- the bank loan being repaid in full during the year, which was on a variable rate basis,
-- renegotiation of interest rates on some of the other loans from 10% to 5% (all fixed rates),
-- partial repayments made in the year on other loans and,
-- the Parag on m ortg a ges which are on a f i xed rate f or
the first five years of t he seven year ter m.
T he i m pact of a 100 b a sis point i ncrea se in interest
rates on these lo a ns w o uld resu lt in a
dditional interest co st f or the year of GBPn il (2 0 22: GBP nil ).
Credit risk m anag e m ent
C redit risk r e fers to t he risk t hat a cou nter par ty will
def a ult on its co ntrac t ual obligatio ns resu lting in f i
nancial lo ss to the Gro u p.
Liquidi ty risk m anag e m ent
T his is the risk of t he Gro up not being able to co ntin ue to
operate as a g oing co ncer n.
T he Di r e c t o rs h a v e, a f t er ca r eful c o n s i der a
ti on of t he f a c t ors s et o ut ab o v e, c o n c l u ded t hat
it is ap p ropr iate to adopt t he g o i ng co n cern b a s is f or
t he prepar ation of t he f i nancial stat e m e n ts a nd t he f i
n a n cial s tate m e n ts do n ot i n c l u de a ny ad j u st m e
n ts t h at w o uld r e s ult if t he g o i ng co n cern b a sis w
as n ot appropriate.
Derivative financial ins truments
T he Gro up does n ot cu rrently u se derivati ve f i nan cial i
n stru ments as hed g i ng is n ot co nsidered neces sar y.
Sh ould the Gro up identi fy a req uire m e nt f or the f u t u
re u se of s uch fin a ncial i n stru m e nts, a co m prehen s i ve
set of policies and s yste ms as appro ved by the Directors will be
im ple m e nted.
Financi al lia bilities 31 March 2023
Total Due within Due within Due over
One year one to five Five years
years
GBP GBP GBP GBP
T rade p a y a b l es 208,652 208,652
Borr o w i ngs - Di recto
r s' loan 3,086,949 874,697 2,212,252
Borr o w i ngs - B a nk
lo an 800,965 800,965
Borr o w i ngs - Ot her
lo a ns 560,000 560,000
Total 4,656,566 1,083,349 2,772,252 800,965
------------------ ------------- -------------- -----------
Financi al lia bilities 31 March 2022
Total Due within Due within Due over
One year one to five Five years
years
GBP GBP GBP GBP
T rade p a y a b l es 364,855 364,855 - -
Borr o w i ngs - Di recto
r s' loan 3,038,382 869,697 2,168,685 -
Borr o w i ngs - B a nk
lo an 924,373 - - 924,373
Borr o w i ngs - Ot her
lo a ns 731,666 - 731,666 -
Total 5,059,276 1,234,552 2,900,351 924,373
------------------ ------------- -------------- -----------
19. NET D E BT R ECONC I L I A T I ON
2023 2022
GBP GBP
Cash at bank 17,148 12,753
--------------- --------------
Cash and ca sh eq u i vale nts 17,148 12,753
Bor r o wing rep a yable (incl u d i ng
o verdrafts) (4,447,914) (3,924,724)
Net Debt (4,430,766) (3,911,971)
--------------- --------------
Ca sh and G ro ss borr T ota l
liquid invest o wings with ca sh and
ment a fixed intere liquid invest
st rate m ents
GBP GBP GBP
Net debt as at 1 A pril 2021 246,193 (4,818,488) (4,572,295)
Cash flo ws (233,440) 893,764 660,324
-------------- --------------- --------------
Net debt as at 31 M arch 2 0 22 12,753 (3,924,724) (3,911,971)
Cash flo ws 4,395 (523,190) (518,795)
-------------- --------------- --------------
Net debt as at 31 M arch 2 0 23 17,148 (4,447,914) (4,430,766)
-------------- --------------- --------------
20. SUBSE Q U ENT E V ENTS
E v e n ts following t he y e ar- e nd t hat pr o v i de ad d
iti o nal i n f o r m a ti on ab o ut t he G r o u p 's po s i t i
on at t he repor t i ng da te a nd are ad j u st i ng e v e n ts a
re r e f l e c t ed in t he f i nanc i al s t a t e m e n t s. E
ven ts s u b s e q uent to t he y ear-e nd t h at are n ot ad j u s
t i ng e v e n ts are d i s c l o s ed in t he n o t es wh en m a t
er i a l.
Following the year end, the Group accepted an offer on Orchard
House of GBP940,000 less costs of sale, with the proceeds being
used to clear the outstanding loan owed to Paragon Mortgages of
GBP698,060 , a partial loan repayment of GBP176,000 being made to
Mr G Howard, payment of creditors of GBP53,189.
On 18 August , the Company issued 125,000,000 new ordinary
shares of 0.1p fully paid up in cash at 0.1p per share under a
placing raising GBP125,000 before expenses.
Note
2023 2022
GBP GBP
Fixed Assets
I nv e s t m e n ts 7 - -
Current a ssets
Stocks -
Debtors 8 54,220 34,339
Cash at bank a nd in hand 3,842 3,657
----------- -----------
58,062 37,996
TOTAL ASSET 58,062 37,996
=========== ===========
EQUITIES & LIABILITIES
Current liabilities
Trade & other payables 9 961,756 977,891
TOTAL LIABILITIES 961,756 977,891
NET (LIABILITIES) (903,694) (939,895)
Called up s hare capital 11 2,860,150 2,726,817
Share pr e m i um acco unt 3,484,915 3,250,249
Loan note equity reserve 107,204 30,303
Profit and loss account (7,355,963) (6,947,264)
----------- -----------
Equity - attributable to the o wners
of the Parent (903,694) (939,895)
TOTAL EQUITY AND LIABILITIES 58,062 37,996
=========== ===========
T he lo ss f or the fin a ncial year dealt with in the f i n a
ncial state m e nts of the Parent C o m pany w as l o ss of
GBP408,699 (20 22: l o ss GBP285,856 ).
T he fin a ncial state ments were appro ved by the Board of Di
rectors on 15 December 2023 and auth
orised f or is s ue and are signed on its behalf b y:
P T rea d a w a y:
..............................................G Thorneycroft:
...................................................
C o m pany Reg i stration N u m b e r: 04 3 40 1 25
T he n otes on pages 47 to 54 f orm an integ ral part of th e se
f i nancial state m e nts
Loan
Share Share Note Retained Total
Capital Premium Equity profits/ Equity
Reserve (losses)
GBP GBP GBP GBP GBP
At 1 April 2021 2,726,817 3,250,249 71,074 (6,628,350) (580,210)
Loss for the year (285,856) (285,856)
---------- ---------- --------- ------------ ------------
Total comprehensive income
for the year (285,856) (285,856)
---------- ---------- --------- ------------ ------------
Loan note equity reserve 18,182 18,182
Movement in loan note equity
reserve (58,953) (33,058) (92,011)
At 31 March 2022 2,726,817 3,250,249 30,303 (6,947,264) (939,895)
========== ========== ========= ============ ============
At 1 April 2022 2,726,817 3,250,249 30,303 (6,947,264) (939,895)
Loss for the year (488,864) (488,864)
---------- ---------- --------- ------------ ------------
Total comprehensive income
for the year - (488,864) (488,864)
---------- ---------- --------- ------------ ------------
Movement in Loan note equity
reserve 76,901 80,165 157,066
Shares issued during the
year net of costs 133,333 234,666 - - 367,999
At 31 March 2023 2,860,150 3,484,915 107,204 (7,355,963) (903,694)
========== ========== ========= ============ ============
Further details of share capital are shown in Note 11.
Loan note equity reserve is the amount that has been provided
for in respect of the difference between the cash value and the
liability element of the loan notes. An adjustment has been made of
GBP76,901 (2022:GBP18,182) as this amount relates to the period
from year end to the expiry of the loan notes being 31 July
2024.
T he n otes on pages 47 to 54 f orm an integ ral part of th e se
f i nancial state m e nts.
1. G ENE RAL INFORMATI ON
Nature of opera tions
T rafalgar P r operty Gro up Plc ( " t he C o m p a n y") is t
he UK holding co m pany of a g ro up of co m panies w hich are eng
a ged in residual property d e velop ment and charges an
appropriate management fee for general costs incurred 2023 -
GBP78,591 (2022 - Nil). T he C o m p a ny is r e gis tered in En
gla nd and Wales. I ts reg i stered of fice a nd principal place of
b us i ness is Cheq uers Bar n, Chequers Hill, Bo u gh Beech, Eden
brid ge, Kent TN8 7 PD.
2. BASIS OF PREPARA TI ON
T he f i n a n c i al s t a t e m e n ts h a ve be en prepa r ed
u n der t he h i st o r i c al co st conv e n ti on a nd in accord
a nce wi th app li ca b le U n i t ed K i n g d om l aw, F RS 102
and accou nti ng sta n dard s. T he principal acco unti ng policies
are descr i bed belo w. T h ey h a ve all been ap plied co n s i
ste ntly t hrough o ut t he y ear a nd p rec e d i ng yea r.
T he C o m p a ny h as t a k en ad v a nta ge of t he e x e m p
tion allo w ed u n der s ection 408 of t he C o m pa n i es A ct
2006 a nd h as n ot pr e s e n ted its o wn Stat e m e nt of C o m
pr e h e n s i ve I nco me to t h e se f i n a n cial s tat e m e
nts. T he C o m pany h as ta ken ad v a ntage of t he disclo s u re
ex e m ption f r om t he req uire m e n ts of section 7 State m e
nt of Cas h flo w, as per mitted by t he FRS 102 " T he Fi n a
ncial Reporting Sta n dard applicable in the UK a nd Rep u blic of
Irelan d".
3. SI GNIF ICANT ACCOUN T ING PO LI C I ES
(a) G O I NG CONC ERN
T he Directors h a ve revie wed f orecasts a nd b u d gets f or
t he co ming year, w hich have been dr a wn up with appr o priate
regard f or the cu r rent eco n o mic e n viron m e nt a nd the
partic ular circu m stances in w hich t he C o m p a ny operates. T
hese were prepared with r e ference to historical and cu rrent i n
d u stry k n o wled ge, ta king into acco u nt f utu re strate gy
of t he C o m p a ny and wider Gro u p.
As indicated in note 13, subsequent to the balance sheet date,
the Company has raised GBP125,000 before expense, for working
capital purposes by way of an issue of 125,000,000 shares at 0.1p
per share. T he existi ng operatio ns h a ve been g e nerati ng fu
n ds to meet sh or t -term operating ca sh req uire m e n t s. As a
res ult of th e se con s ideratio ns, at the ti me of appro ving
the f i nancial state m e n t s, the Directors co nsider th at the
C o m pany a nd t he Gro up have s uf ficie nt reso u rces to
contin ue in operatio nal e xiste nce f or the f oreseeable f u t u
r e. It is ap pro p riate to ad opt the g oing co nce rn basis in t
he preparation of the f i nan cial state ments. As w ith all b us i
ness f orecasts, the Director s' state m e nt cannot g uarantee
that t he g oing co ncern b a sis will r e main appr o priate given
t he material uncertai n ty abo ut t he f u t u re events.
(b) INVEST M ENTS
I nv e s t m e n ts held as f i xed ass ets are stated at co st
less pro vision f or i m pair ment.
(c) TAXA TI ON
Cu rrent ta x, i ncl u ding UK c orporati on tax a nd f oreign
ta x, is pro vided at a m o un ts e xpected to be paid (or reco
vered) using the tax rates and la ws t hat h a ve been e nac ted or
su b stanti vely e nacted by the balance s heet da t e.
D e f erred t ax is reco gn is ed in re s pect of a ll t i m i
ng d i f f ere n ces t h at h a ve or i g i n a t ed b ut n ot re v
er s ed at t he bala nce s h eet d ate w h e re tra n s actio ns or
e v e nts t hat r e s u lt in an o bli gation to p ay m o re tax in
t he fu t u re or a r i g ht to p ay less t ax in t he f u t u re h
a ve o cc u r red at t he b a lance s heet date. T i m i ng d i ff
e r e nces are d i f f e r e nces bet ween t he Co m pa ny's ta
xable pr o f its a nd its re s u lts as s tated in t he f i n a n
cial state m e n ts t hat ar ise f r om t he i n cl u sion of g a i
ns a nd lo s s es in tax a s s e ss m e n ts in y ears d i ffer e
nt fr om t h o se in w h i ch t h ey a re r eco g n ised in the fin
a ncial state men t s.
A deferred tax a sset is regarded as reco verable and theref ore
reco gnised o n ly w hen, on t he basis of all a vailable evide
nce, it can be r e garded as m o re li k e ly t h an n ot t h at t
h e re w ill be s uitab le t a xable pr o f its fr om w hich t he f
utu re rever s al of the u n der l y i ng ti m i ng differences can
be ded ucted.
(d) FINANC IAL INS TRUM ENTS
Fin a ncial a ssets a nd liabilities are reco g nised in t he
state ments of f i nancial po sition w h en t he C o m pany has
beco me a par ty to the co ntrac t ual pro visions of t he in str u
m e nts.
T he C o m p a n y 's f i n a ncial as s ets and liabilities are
initially mea s u red at fair val ue plus any directly attrib
utable transaction co s t s. T he car r y i ng value of the C o m p
a n y 's f i nancial a sset s, pr i marily ca sh a nd bank balance
s, a nd liabilities, pr i marily t he C o m pan y 's p a yables and
other accr ued ex pen ses, appro x i mate to their fair val
ues.
(i) Fin a ncial as sets
On i nitial recog nitio n, fin a ncial ass ets are classified as
either f i nancial as sets at fair val ue th rough pro fit or lo
ss, held -to - matu r ity i n vest m e nts, loans a nd receivables
f i nancial asset s, or available -f o r - sale f i nan cial as
sets, as appr o priate.
T r a de and other receivables
T r a de and other receivables ( i nclu d i ng depo sits a nd
prep a yments) t hat h a ve f i xed or deter minable p a ymen ts t
hat are n ot q u oted in an active mar ket are class i fied as
other receivables, depo sits, and pr e paym e nts. Other
receivables, depo sits, and pr e paym e nts are mea s u red at a
mortised co st us i ng t he e f fecti ve inter e st met h od, less
any i m p air m e nt lo ss. I nter e st inco me is recog n i sed by
app l ying the e ffective i nterest rate, except f or s h or t
-term receivables w h en t he reco g niti on of inter e st w o uld
be i m material.
(ii) Fin a ncial liabilities a nd convertible debt
Fin a ncial liabilities are cla ss i fied as liabilities or eq u
ity in accordance w ith the s u b sta nce of t he co ntrac t ual
arrang e ment.
Fin a ncial liabilities
Fin a ncial liabilities co m prise lo n g -term bo r ro win gs,
sh o r t -term borro win gs, trade and other payables and accr
uals, mea s u red at a m ortis ed co st us i ng t he ef fecti ve i
nterest met h od.
T he ef fecti ve interest met h od is a met h od of calculati ng
the a m ortised co st of a financial liability a nd of allocating i
nterest inco me o v er the relevant period. T he ef fective
interest rate is the rate that exac tly disco un ts esti mated f u
t u re ca sh p a ym e nts ( i nclu d i ng all fees on poin ts paid
or received t hat f o rm an i nte g ral part of t he ef fective
interest rate, tra ns action co s ts and o t her pr e m i u ms or
disco un t s) t h ro u gh t he ex pected li fe of the f i nancial
liabilit y, or, w here a ppr o priate, a sh orter per i od to the
net car r ying a m o u nt on i n itial reco gnitio n.
Convertible debt
Convertible debt is sued by t he G ro up are classified
according to the s u b sta nce of t he co ntractual arran g e m e n
ts ente red into and the definitions of a fin a ncial liability and
convertible debt i nstr u ment. Convertible debt consists of new
unsecured loan notes convertible totaling GBP905,000 (2022:
GBP905,000) in full, into 226,250,000 ordinary shares at 0.4p per
ordinary share and can be convertible at any time by Mr C C Johnson
for two years from July 2022, further details are provided within
note 11.
T he acco un ti ng policies adopted f or s pecific f i n a ncial
liabilities a nd convertible debts are s et o ut belo w.
4. CRIT ICAL ACCOUN TI NG JUD G E M ENTS AND K EY SOURC ES OF E S TI MATI ON UNCER T A INTY
In the application of t he C o m p a n y 's acco unti ng
policies, w hich are described in note 3, the Directors are req
uired to m a ke j u d g e m e n t s, esti mates a nd assu m ptio ns
ab o ut the car r y i ng a m o un ts of as sets and liabilities t
hat are n ot apparent f rom o t her s o u rce s. T he esti mates
and assu m ptions are based on historical ex perience and other
factor s, incl u ding ex pectatio ns of f utu re ev e nts t hat are
believed to be rea s o nable un der the circu m stance s. Act ual
res ults m ay differ f r om these esti m ates.
T he esti m ates a nd u n der l ying assu m ptio ns are r e vie
wed on an o n - g oing basi s. Revisions to acco unti ng esti mates
are reco gnised in the period in w hich t he e sti mate is r e
vised if t he r e vision a f fects o n ly t hat period or in the
period of the rev i sion a nd f uture perio ds if the r e vision af
fects both cu rrent a nd f u t u re period s.
T he f ollo wing are t he k ey ass u m ptio ns co ncer n i ng t
he f utu re and other k ey s o u rces of e s ti mation uncertai n
ty at the state ment of f i n a ncial po sition date th at h a ve a
s i g nifica nt risk of ca us i ng a s i g n i f ica nt ad j us t m
e nt to t he carr y i ng a m o un ts of as sets a nd liabilities in
t he fin a ncial state m e nts:
Carrying value of invest m e n ts in sub sidiaries and interc o
mpany
Ma nag e m e n t 's a ssess ment f or i m pair m e nt of in vest
m e nt in s u b sidiaries is based on the e sti mation of v alue in
use of t he s u b sidiary by f orecasti ng t he e x pected f u t u
re ca sh flo ws e x pected on ea ch develo p ment pro ject. T he
val ue of the i nv e s t ment in su b sidiar ies is based on the su
b sidiaries being able to realise th eir ca sh flow pro jectio
ns.
Recognition of deferred tax a ssets
T he reco gnition of deferred tax assets is based u pon w het h
er it is m ore likely th an n ot that s u f ficient and s uitable
taxable pro fits will be available in the f utu re agai n st w hich
t he rever sal of te m por a ry d i ffer e nces can be ded ucted.
To deter m i ne the f utu re ta xable pro fits, r e ference is made
to the latest a v ailable pro fit f orecasts. W here the te m
porary differences are related to l o sses, relevant tax law is co
nsidered to d eter m i ne the av ailability of the lo s ses to of f
set a gai nst t he f u t u re taxable pro fits.
5. LOSS FOR FINANC I AL PERIOD
T he C o m p a ny has ta ken ad v a ntage of section 408 of the
Co m p a nies Act 2006 an d, co nseq uentl y, a pro fit and lo ss
acco u nt f or the C o m pany alo ne has n ot been prese nted. T he
C o m pan y 's lo ss f or the f i nancial period was GBP408,699 (
2022: L o ss GBP285 ,856).
6. E MPLO Y EES AND D I R E C T O RS' R E MUN E RA T I ON
2023 2022
GBP GBP
Director s' fees 107,567 31,500
Social sec u rity co sts 11,211 1,788
Directors' pension contribution 1,500 270
Ma nag e m e nt fees - 2,500
------- ------
120,278 36,058
------- ------
T he average nu m ber of e m plo yees of t he C o m pany d u r i
ng t he year was:
2023 2022
Nu mber Number
Directors and m a nag e m e nt 5 3
T here are no retirement ben e f its accr u i ng to any of t he
Director s.
GBPNil ( 20 22: GBP2,500 ) w as paid to Mr Nor man L ott f or h
is pro fessio nal ser vice s.
A dditional directors r e m u neration of GBP60,000 ( 2 022:
GBP60,000) w as paid to a director th ro ugh su b sidiary en
tities.
7. I NVE ST M ENTS
T he C o m pany o w ns the f ollowing un dertakings, all of w h
ich are in c o r po r ated in the United Kin g dom and have their
regis ter ed o ffices at Cheq uers Bar n, C heq uers Hill, Bo ugh
Beech, Eden brid ge, Ke nt, TN8 7 PD.
Valuation 2023 2022
Cost:
At 1 April 3,855,338 3,855,338
Additions 100 -
------------ ------------
At 31 March 3,855,438 3,855,338
Impairment:
At 1 April (3,855,338) (3,855,338)
Additions (100) -
------------ ------------
At 31 March (3,855,438) (3,855,338)
Net Value at 31 March - -
============ ============
Held directly Cla ss of shares % Sh areholding Principal Activity
held
T rafalgar New Ho mes Ordinary s hares
L i mited 100% Residential property
develop e rs
T rafalgar Retir e m e nt + Ordinary s hares
L i mited 100% Residential property
& assisted liv i ng
sch e me
Sel mat L i mited Ordinary s hares
100% Residential property
renting
Life Hydroponic Assets Ltd Ordinary s hares 100% Holding of hydroponic
assets
Held indirectly through Tra falgar New H o mes L i mited
C o m be Bank Ho mes (Oak h Ordinary s hares 100% Residential property
u r st) L i mited develop e rs
Controlled via Deed of Trust
C o m be Hou se (Boro ugh Gree Ordinary s hares 100% Residential property
n) L i mited develop e rs
Life Hydroponic Asset Ltd was incorporated in October 2022. The
company subsequently acquired a dedicated research and development
site for research relevant to food, cosmetic and pharmaceutical
products. Trafalgar Property Group Plc owns 100% share of the
company.
8. DE B T ORS
2023 2022
GBP GBP
Am ou n ts o wed by G ro up u n dertakin
gs 36,298 4,930
Other debtors 17,922 17,515
Other tax es and s ocial sec u rity - 11,894
------ ------
54,220 34,339
------ ------
9. CREDIT ORS: A MO UNTS FALLING DUE WIT H IN O NE YEAR
2023 2022
GBP GBP
Trade creditors 95,754 22,233
Taxation and social security 20,191 -
Accruals / Other creditors 27,545 46,600
Directors' loan 789,947 769,697
Amounts owed to Group undertakings 28,319 139,361
------- -------
961,756 977,891
------- -------
10. FINANCIAL INSTRUMENTS
Financial a ssets 2023 2022
GBP GBP
Financial assets:
Financial assets measured at amortised
cost:
Amounts owed by group undertakings and
other debtors 54,220 22,445
Financial liabilities:
Financial liabilities measured at amortised
cost 961,756 977,891
Financial liabilities includes Trade
creditors, Other creditors and Amount
due to group undertakings.
11. SHARE CAP IT AL
Issued, allotted and paid share capital
2023 2022
Number Number
Ordinary shares:
Ordinary shares of 0.1p in issue 142,519,038 142,519,038
Ordinary shares of 0.1p issued in 133,333,333 -
year
Total Ordinary Shares of 0.1p in issue 275,852,371 142,519,038
------------ ------------
Deferred shares:
Deferred shares of 0.9p in issue 287,144,228 287,144,228
Deferred shares of 0.9p arising in - -
year
------------ ------------
Total Deferred Shares of 0.9p in issue 287,144,228 287,144,228
------------ ------------
Issued, allotted and paid share capital
2023 2022
GBP GBP
Ordinary shares:
Ordinary shares of 0.1p in issue 142,519 142,519
Ordinary shares of 0.1p issued in 133,333 -
year
Total Ordinary Shares of 0.1p in issue 275,852 142,519
---------- ----------
Deferred shares:
Deferred shares of 0.9p in issue 2,584,298 2,584,298
Deferred shares of 0.9p arising in - -
year
---------- ----------
Total Deferred Shares of 0.9p in issue 2,584,298 2,584,298
---------- ----------
Total Ordinary and Deferred Shares
issued 2,860,150 2,726,817
========== ==========
Background - ordinary shares, warrants and loan notes
On 13 July 2020 the Company undertook a sub-division of its
ordinary shares, which sub divided the 487,690,380 0.1p ordinary
shares of 0.1p each into 487,690,380 ordinary shares of 0.01p each
and 487,690,380 0.09p deferred shares of 0.09p each. The 0.09p
deferred shares of 0.09p each were consolidated into deferred
shares of 0.9p each ranking pari passu as one class with the
existing deferred shares of 0.9p each.
On 14 July 2020, 937,500,000 ordinary shares of 0.01p each were
issued under a placing at 0.08p each (at a premium of 0.07p per
share) to raise GBP750,000 before costs of GBP66,863.
In addition, on 14 July 2020 warrants to subscribe for ordinary
shares of 0.01p were granted as follows:
(a) Subscribers to the placing were granted warrants to
subscribe for up to 937,500,000 shares for a period of two years,
exercisable at 0.2p per share;
(b) Peterhouse Capital Limited was granted warrants to subscribe
for shares equivalent up to 3% of the issued ordinary share capital
from time to time, exercisable for a period of two years, at 0.08p
per share.
Following the consolidation of ordinary shares in December 2020,
the warrants have been adjusted and comprise place warrants to
subscribe for up to 93,750,000 ordinary shares of 0.1p at 2p per
share, and the warrants held by Peterhouse Capital Limited are
exercisable at 0.8p per share.
In relation to the granting of these warrants to Peterhouse
Capital Limited, these fall under the requirements of IAS 39
Financial Instruments and as such are accounted for at fair value
through profit or loss. At the grant date of these warrants these
are valued using a Black Scholes model to determine the intrinsic
value of the warrant and a liability is recognized for this amount
with a corresponding expense through the income statement. The
Directors' have concluded that the intrinsic value of the warrant
as at 31 March 2021 is not material to the results and subsequent
movements in the share price have decreased this value further. As
such no accounting entries have been made to these results.
Further on 14 July 2020, GBP600,000 of convertible loan notes
were issued to Mr C C Johnson as part of arrangements to reorganise
loans between him and the Group. The notes are repayable on 31 July
2022 and are convertible at any time into 300,000,000 ordinary
shares of 0.01p at 0.2p per share. On conversion, warrants to
subscribe for up to 300,000,000 ordinary shares will be granted to
Mr C C Johnson exercisable for a period of two years from the date
of grant at 0.2p per share. Following the consolidation of ordinary
shares in December 2020, the loan notes have been adjusted and are
convertible into 30,000,000 ordinary shares of 0.1p at 2p per
share, with warrants to be granted to subscribe for up to
30,000,000 ordinary shares of 0.1p each at 2p per share, with
warrants to be granted to subscribe for up to 30,000,000 ordinary
shares of 0.1p each at 2p per share.
The convertible loan notes have been accounted for as having
both a debt and an equity element. This results in the creation of
a loan note equity reserve at the point of issue. This loan note
equity reserve is the difference between the loan note value
received by the Company of GBP600,000 and the fair value of a debt
only instrument with a 10% imputed interest rate and a final
settlement figure of GBP600,000 in July 2022. This 10% imputed
interest rate is managements' best estimate as to the interest rate
that would be expected from the market for an unsecured loan of
GBP600,000 without a conversion element.
In 2022, the Company has agreed with Mr C C Johnson a
consolidation and variation of terms of the two unsecured
convertible loans notes and director debt held by Mr C C Johnson.
The conversion of the total amount owed to him by the Company
(GBP905,000) has resulted in the issue to Mr C C Johnson of a new
unsecured convertible loan note for an aggregate amount of
GBP905,000 payable July 2024. This has replaced:
-- The GBP600,000 unsecured convertible loan notes issued in
July 2020, which would have been redeemable on 31 July 2022, and
which were convertible at 2p per share (following the share
consolidation in December 2020) and carried the right upon a
conversion of the loan notes, to the grant of warrants to subscribe
for ordinary shares on a one for one basis, exercisable at the
conversion price of 2p for a period of two years from the date of
grant;
-- The GBP200,000 unsecured convertible loan notes comprised in
the loan facility entered into in November 2021, which would have
been redeemable on 30 November 2022, and which were convertible at
0.7p per share.
-- GBP105,000 owed to him by the Company on directors loan account.
The new unsecured convertible loan note is convertible in full
into 226,250,000 ordinary shares at 0.4p per ordinary share and can
be converted at any time by Mr Johnson, subject inter alia to his
entire holding being less than 29.99 per cent of the voting rights
in issue in the Company.
Or din a ry shares en title the h o l d er to r eceive n o tice
of and to attend or v o te at any general
meeting of the C o m pany or to receive dividen ds or oth er distri b uti o n s.
Defer red sh a res do n ot entitle the h old er to r eceive
notice of and to attend or v o te at a ny gener al meeting of the C
o m pany or to receive div i den ds or other distrib u tio n s. U
pon win ding up or dis s olu tion of the C o m pany the h o l d e
rs of defer r ed shares shall be entitled to r eceive an am o unt
eq ual to the n o minal am ou nt paid up th e r e o n, b ut o nly
after h o l d e rs of o r din a ry shares have r eceived GBP10 0 ,
0 00 p er o r dinary share. H o l d ers of def e r red sh a res are
not entitled to any further rights of participation in the assets
of the Company. The Company has the right to purchase the deferred
shares in issue at any time for no consideration.
On 29 December 2020 for every ten of the 1,425,190,380 ordinary
shares of 0.01p then in issue, were consolidated into one ordinary
share of 0.1p resulting in there being 142,519,038 ordinary shares
of 0.1p in issue.
Current year position - ordinary shares, warrants and loan
notes
During the financial year to 31 March 2023, no changes have
taken place with regards to the shares and warrants issued.
12. INT ERCO MPANY TRANSACTI O NS
T he Co m pany has tak en ad vanta ge of t he ex e m ption c o n
ferred by F RS102 Section 33 "Related Par ty disclo su res" n ot to
disclo se transactio ns un derta ken w ith o t her w h olly o w ned
m e m bers of t he Gro u p and transactions with directors.
13. SUBSEQUENT EVE N TS
On 18 August 2023, the Company issued 125,000,000 new ordinary
shares of 0.1p fully paid up in cash at 0.1p per share under a
placing raising GBP125,000 before expenses.
Explanation of resolutions at the Annual General Meeting
Information relating to resolutions to be proposed at the Annual
General Meeting is set out below. The notice of AGM is set out on
page 55.
Ordinary business at the AGM
The following ordinary business resolutions will be proposed at
the AGM:
(a) Resolution 1: to approve the annual report and accounts. The
Directors are required to lay before the Company at the AGM the
accounts of the Company for the financial year ended 31 March 2023,
the report of the Directors and the report of the Company's
auditors on those accounts.
(b) Resolution 2: to approve the re-appointment of MHA as
auditors of the Company. The Company is required to appoint
auditors at each general meeting at which accounts are laid, to
hold office until the next such meeting.
(c) Resolution 3: to approve the remuneration of the auditors for the next year.
(d) Resolution 4: to re-appoint Norman Lott as a Director;
Norman is retiring by rotation and submitting himself for
re-election.
Special business at the AGM
The following special business resolutions will be proposed at
the AGM:
(a) Resolutions 5 and 6: to renew residual authorities (i) to
allot securities under section 551 of the Companies Act 2006, in
the amount of up to GBP250,000 (250,000,000 ordinary shares of
0.1p), representing approximately 62% of the existing issued
ordinary share capital; and (ii) to disapply pre-emption rights on
the allotment of securities for cash for the purposes of section
561 of the Companies Act 2006, in the amount of up to GBP250,000
(250,000,000 ordinary shares of 0.1p), representing approximately
62% of the existing issued ordinary share capital.
The authorities under these resolutions would subsist until the
conclusion of the Annual General Meeting of the Company to be held
in 2025 or, if earlier, 15 months after the date on which this
resolution has been passed, provided that the Company may, before
such expiry, make an offer, agreement or other arrangement which
would or might require shares and/or rights to subscribe for or to
convert any security into shares to be allotted after such expiry
and the directors may allot such shares and/or rights to subscribe
for or to convert any security into shares in pursuance of such
offer, agreement or other arrangement as if the authority conferred
hereby had not expired.
NO TI CE OF ANNU AL GENERAL M EET ING
NOT I CE IS HE REBY GIVEN that t he 2023 An n ual General
Meeting of t he C o m p a ny will be held at t he C o m pan y 's of
fices at C heq uers Bar n, Bo ugh Beech, Eden brid ge, Kent TN8 7
PD at 11am on 10 January 2024, f or the f ollo w i ng p u rpo
ses:
RESOLUTIONS
Ordinary business
To consider and, if thought fit, to pass resolutions 1 to 4 as
ordinary resolutions:
1. To receive and adopt the directors' report, the auditor's
report and the Company's accounts for the year ended 31 March
2023.
2. To re-appoint MHA as auditor in accordance with section 489
of the Companies Act 2006, to hold office until the conclusion of
the Annual General Meeting of the Company in 2024.
3. To authorise the Directors to determine the remuneration of the auditor.
4. To re-appoint Norman Lott as a non-executive director of the Company.
Special business
To consider and, if thought fit, to pass resolutions 6 and 8 as
ordinary resolutions, and resolutions 7 and 9 as special
resolutions:
6. THAT, in addition to all existing authorities conferred on
the directors to allot shares or to grant rights to subscribe for
or to convert any securities into shares, the directors be
authorised generally and unconditionally pursuant to Section 551 of
the Companies Act 2006 as amended to exercise all the powers of the
Company to allot shares and/or rights to subscribe for or to
convert any security into shares, provided that the authority
conferred by this resolution shall be limited to the allotment of
equity securities and/or rights to subscribe or convert any
security into shares of the Company up to an aggregate nominal
value of GBP250,000 (250,000,000 ordinary shares of 0.1p), such
authority (unless previously revoked, varied or renewed) to expire
on the conclusion of the Annual General Meeting of the Company to
be held in 2025 or, if earlier, 15 months after the date on which
this resolution has been passed, provided that the Company may,
before such expiry, make an offer, agreement or other arrangement
which would or might require shares and/or rights to subscribe for
or to convert any security into shares to be allotted after such
expiry and the directors may allot such shares and/or rights to
subscribe for or to convert any security into shares in pursuance
of such offer, agreement or other arrangement as if the authority
conferred hereby had not expired.
7. THAT, in addition to all existing authorities conferred on
the directors to allot shares or to grant rights to subscribe for
or to convert any securities into shares, the directors be and are
hereby generally empowered to allot equity securities (within the
meaning of Section 560 of the Companies Act 2006) pursuant to the
general authority conferred by resolution 6 above for cash or by
way of sale of treasury shares as if Section 561 of the Companies
Act 2006 or any pre-emption provisions contained in the Company's
articles of association did not apply to any such allotment,
provided that the power conferred by this resolution shall be
limited to:
(a) any allotment of equity securities where such securities
have been offered (whether by way of rights issue, open offer or
otherwise) to holders of equity securities in proportion (as nearly
as may be practicable) to their then holdings of such securities,
but subject to the directors having the right to make such
exclusions or other arrangements in connection with such offer as
they deem necessary or expedient to deal with fractional
entitlements or legal or practical problems arising in, or pursuant
to, the laws of any territory or the requirements of any regulatory
body or stock exchange in any territory or otherwise howsoever;
(b) the allotment (otherwise than pursuant to sub-paragraph (a)
above) of equity securities up to an aggregate nominal value of
GBP250,000 (250,000,000 ordinary shares of 0.1p), such authority
(unless previously revoked, varied or renewed) to expire on the
conclusion of the Annual General Meeting of the Company to be held
in 2025 or, if earlier, 15 months after the date on which this
resolution has been passed, provided that the Company may, before
such expiry, make an offer, agreement or other arrangement which
would or might require shares and/or rights to subscribe for or to
convert any security into shares to be allotted after such expiry
and the directors may allot such shares and/or rights to subscribe
for or to convert any security into shares in pursuance of such
offer, agreement or other arrangement as if the authority conferred
hereby had not expired.
Dated: 15 December 2023
Registered Office : By order of the Board
Chequers Barn Nicholas Narraway
Chequers Hill Secretary
Bough Beech
Edenbridge
Kent
TN8 7PD
Notes:
1. Shareholders are strongly encouraged to participate in the
meeting by returning forms of proxy ahead of the meeting.
2. As a member of the Company, you are entitled to appoint a
proxy to exercise all or any of your rights to attend, speak and
vote at the Meeting and you should have received a proxy form with
this notice of meeting. You can only appoint a proxy using the
procedures set out in these notes and the notes to the proxy
form.
3. A proxy does not need to be a member of the Company but must
attend the Meeting to represent you. Details of how to appoint the
Chairman of the Meeting or another person as your proxy using the
proxy form are set out in the notes to the proxy form.
4. You may appoint more than one proxy provided each proxy is
appointed to exercise rights attached to different shares. You may
not appoint more than one proxy to exercise rights attached to any
one share. To appoint more than one proxy, you may photocopy the
enclosed proxy form.
5. If you do not give your proxy an indication of how to vote on
any resolution, your proxy will vote or abstain from voting at his
or her discretion. Your proxy will vote (or abstain from voting) as
he or she thinks fit in relation to any other matter which is put
before the Meeting.
6. The notes to the proxy form explain how to direct your proxy
how to vote on each resolution or withhold their vote.
To appoint a proxy using the proxy form, the form must be:
(a) completed and signed;
(b) sent or delivered to the Company's Registrars, Neville
Registrars Limited, Neville House, Steelpark Road, Halesowen B62
8HD; and
(c) received by no later than 11 a.m. on 08 January 2024.
Any power of attorney or any other authority under which the
proxy form is signed (or a duly certified copy of such power or
authority) must be included with the proxy form.
7. To change your proxy appointment, simply submit a new proxy
appointment using the methods set out above. Note that the cut-off
time for receipt of proxy appointments (see above) also apply in
relation to amended instructions; any amended proxy appointment
received after the relevant cut-off time will be disregarded.
Where you have appointed a proxy using the hard-copy proxy form
and would like to change the instructions using another hard-copy
proxy form, you may photocopy the enclosed proxy form.
If you submit more than one valid proxy appointment, the
appointment received last before the latest time for the receipt of
proxies will take precedence.
8. In order to revoke a proxy appointment, you will need to
inform the Company by sending a signed hard copy notice clearly
stating that you revoke your proxy appointment to Neville
Registrars Limited, Neville House, Steelpark Road, Halesowen, B62
8HD. Any power of attorney or any other authority under which the
revocation notice is signed (or a duly certified copy of such power
or authority) must be included with the revocation notice.
The revocation notice must be received by no later than 11 a.m.
on 08 January 2024.
If you attempt to revoke your proxy appointment but the
revocation is received after the time specified then, subject to
the paragraph directly below, your proxy appointment will remain
valid.
Appointment of a proxy does not preclude you from attending the
Meeting and voting in person.
9. Pursuant to Regulation 41 of the Uncertificated Securities
Regulations 2001, only those members registered in the register of
members of the Company as at 6.00 p.m. on 08 January 2024 shall be
entitled to attend and vote at this Meeting in respect of the
number of shares registered in their name at that time. Changes to
entries on the relevant register of securities after such time
shall be disregarded in determining the rights of any person to
attend or vote at this Meeting.
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END
FR FLFSRFELELIV
(END) Dow Jones Newswires
December 15, 2023 11:48 ET (16:48 GMT)
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