XLON:ALNA ESEF Annual Report
ALINA HOLDINGS PLC (XLON:ALNA)
ESEF Annual Report
2023-07-04
For: 2022-12-31
View Original
Added on
September 22, 2026
Alina
Holdings PLC
Annual Report
For the Year Ended 31 December 2022
2
Directors, Secretary and Advisers
Directors
C Duncan Soukup,
Chairman
T Donell
M Porter
Registered Office
Eastleigh Court,
Bishopstrow
Warminster
BA12 9HW
Company Secretary
Alasdair Johnston
Solicitors to the Company
Locke Lord (UK) LLP
201 Bishopsgate
London
EC2M 3AB
Eversheds Sutherland
One Wood Street
London
EC2V 7WS
Auditors
RPG Crouch Chapman LLP
5th Floor, 14-16 Dowgate Hill
London, EC4R 2SU
Registrars
Equiniti Limited
Aspect House
Spencer Street
Lancing
BN99 6QQ
Company website
www.alina-holdings.com
3
Contents
Directors, Secretary and Advisers .............................................................................................. 2
Highlights for the Year ended 31 December 2022 .................................................................... 4
Report for the Year to 31 December 2022 ................................................................................. 5
Chairman’s Statement ................................................................................................................ 5
Financial Review ....................................................................................................................... 6
Corporate Responsibility Statement ........................................................................................ 11
Governance .............................................................................................................................. 13
Directors’ Report ..................................................................................................................... 18
Statement of Directors’ Responsibilities ................................................................................. 21
Independent Auditors’ Report to the members of Alina Holdings PLC ................................. 23
Consolidated Statement of Income .......................................................................................... 28
Consolidated Statement of Comprehensive Income ................................................................ 29
Consolidated Statement of Financial Position ......................................................................... 30
Consolidated Statement of Cash Flows ................................................................................... 31
Consolidated Statement of Changes in Equity ......................................................................... 32
Notes to the Consolidated Financial Statements ...................................................................... 33
Company Balance Sheet .......................................................................................................... 53
Notes to the Financial Statements ............................................................................................ 5 4
Glossary ................................................................................................................................... 59
•
4
Highlights for the Year ended 31 December 2022
GROUP RESULTS 2022 versus 2021
Group Net Loss for the
y
ear - £000
(
£136
)
vs
(
£294
)
Group Loss Per Share
(
both basic and diluted
)
*
1
(
0.60p
)
vs
(
1.30p
)
Reported Book value per share*
1
26.9p vs 27.5p
Cash - £000*
2
£873 vs £1,767
Financial Holdin
g
s - £000 £2,597 vs £1,819
Propert
y
Holdin
g
s - £000*
3
£3,304 vs £2,784
*
1
Basic and diluted number of shares are the same as actual shares outstanding of 22,697,397 (2021: 22,697,397)
*
2
Cash as at May 2023 was £1.5m, reflecting the sale of Oldham, Manchester.
*
3
Property Holdings, as shown above, reflect ownership of Oldham (as at 31 December 2022). The current valuation of the
Company’s remaining Property Assets is £2,5m
5
Report for the Year to 31 December 2022
Alina Holdings PLC (“Alina” or the “Company”) is a company registered on the Main Market of the
London Stock Exchange. The group financial statements consolidate those of the Company and its
subsidiaries (together referred to as the “Group”).
Chairman’s Statement
The Board of Alina apologise for the delay in presenting the Company’s Accounts for the year ended
31 December 2022, due to the untimely and unforeseen resignation of the Company’s previous auditor.
2022 was a year of transition for ALNA. Significant Board time was spent on repositioning the
Company’s property assets in Brislington, Bristol, for which development plans for a substantial mixed
commercial and residential development have been prepared and where preliminary planning
discussions with Bristol Council have been initiated. In Hastings, the Company is still in dispute with
Argos (now part of Sainsbury), which had a ‘full-repairing’ lease but vacated the property without
completing their contractually obligated repairs. Nonetheless, repair of the vacated property is now
nearing completion despite the discovery of asbestos in some of the floor and ceiling tiles. The Board
is confident that once building works have been completed that the company will achieve a substantial
uplift on the rent previously received from Argos.
The Company’s holdings in HEIQ and Dolphin Capital (DCI) went in opposite directions. HEIQ is guilty
of over promising and under delivering, and suffering from cyclical weakness in the retail sector, which
resulted in a substantial fall in the Company’s share price. DCI, on the other hand announced the
disposal of one of its assets at a premium to BV, which was well received by the market.
Notwithstanding the political chaos across the Western Hemisphere, stretching from Russia and Turkey
to the USA, your Board is confident that the Company is well positioned to benefit from the initiatives
commenced in 2022 and being implemented in 2023.
Duncan Soukup
Chairman
Alina Holdings plc
31 May 2023
6
Financial Review
The financial statements contained in this report have been prepared in accordance with UK Adopted
International Accounting Standards.
Result
The Group recorded an IFRS loss for the year to 31 December 2022 of £136,000, or 0.60 pps
(2021: loss £294,000, or 1.30 pps).
Key Performance Indicators (“KPI’s”)
Throughout the reporting period the Group had no borrowings and held cash reserves at 31 December
2022 of £0.873 million (31 December 2021: £1.767 million). The KPI’s relating to Interest Cover, Loan
to Value and Gearing, shown in previous reports, are therefore no longer applicable. The Net Asset
Value per Share at 31 December 2022 was 26.9p (31 December 2021: 27.5p).
Property Operating Expenses
Property operating expenses for the year to 31 December 2022 were £300,000 (2021: £136,000). This
was predominantly caused by the property rates increases and the vacancy of a larger floorspace in
Hastings. There was a release of bad debt provision in the comparable period which increases the
variance.
Administrative Expenses
Administrative expenses were £604,000 during the year to 31 December 2022 (2021: £540,000).
Net Asset Value (“NAV”)
The NAV at 31 December 2022 was £6.10 million or 26.9p per share, based on 22.7 million shares in
issue, excluding those held in treasury (31 December 2021: £6.23 million, 27.5p per share, based on
22.7 million shares in issues
At 31 December 2022 the Group held £0.873 million of cash (31 December 2021: £1.767 million). At
31 December 2022 the Group had no banking debt (31 December 2021: £nil).
At 31 December 2022, investment properties were held at an assessed fair value of £2,504,000 (2021:
£2,784,000). The fair value has been assessed with reference to a third party valuation performed in
2020. The Board has, however, assessed that the rental yield resulting for the recent sale of the Group’s
Oldham property suggests that its two largest properties were undervalued and has revised the carrying
value to reflect this most recent market data.
The Oldham property considered to be held for sale at 31 December 2022 is valued in the Company’s
accounts at that date at its anticipated sale price less sales costs.
The 2020 external valuation was undertaken in accordance with the Royal Institute of Chartered
Surveyors Appraisal and Valuation Standards on the basis of market value. Market value is defined as
the estimated amount for which a property should exchange on the date of valuation between a willing
buyer and a willing seller in an arm’s length transaction, after proper marketing wherein the parties had
each acted knowledgeably, prudently and without compulsion.
Financing
The Group had no borrowings during the year and the Group’s operations were financed from its
property income.
During the reporting period the Group held some of its cash in foreign currencies. These holdings
generated a small unrealised profit at the end of the period, principally from the reduction in GBP value
against USD across the period. The risk associated with foreign currency holdings is described in Note
16 to the financial statements.
7
Dividend
In line with the Group’s current dividend distribution policy no dividend will be paid in respect of the
reporting period. The directors will continue to review the dividend policy in line with progress with the
Group’s investment strategy.
Risk Management & Operational Controls
The directors recognise that commercial activities invariably involve an element of risk. A number of the
risks to which the business is exposed, such as the condition of the UK domestic economy and
sentiment in the UK property market, are beyond the Company’s influence. However, such risk areas
are monitored and appropriate mitigating action, such as reviewing the substance and timing of the
Company’s operational plans, is taken wherever practicable in response to significant changes. The
directors consider the risk areas the Company is exposed to in the light of prevailing economic
conditions and the risk areas set out in this section are subject to review.
In relation to asset management, the Company’s approach to risk reflects the Company’s granular
business model and position in the market and involves the expertise of its directors, management and
third-party advisers. Operational progress and key investment and disposal decisions are considered
in regular management team meetings as well as being subject to informal peer review.
Higher level risks and financial exposures are subject to constant monitoring. Major investment and
disposal decisions are subject to review by the directors in accordance with a protocol set by the Board.
The Board’s approach in this area is further explained in the Governance section, under Risk &
Internal Control.
Principal Risks and Uncertainties
Potential Risk Impact Mitigation
Property and Investment
Portfolio Performance
Effect of downturn in
macroeconomic environment
• Tenant defaults
• Reduced rental income
• Increased void costs
• Reduction in Net Asset
Value and realisation value of
assets
• Actual and prospective voids and
rental arrears continually
monitored.
• Early identification of /
discussions with tenants in
difficulties
• Regular review of all properties
for lease terminations and tenant
risk, with early action to take
control of units as appropriate
• Limited requirement for tenant
incentives within sub-sector
• Close liaison with local agents
enables swift decisions on
individual properties
• Tendency of small traders to take
early action in response to
economic conditions
• Diverse tenant base
• Sustainable location and property
use
• Ensuring positions are sufficiently
hedged to ensure long and short
positions are in place to take
advantage of the market
movements
Higher than anticipated property
maintenance costs
• Income insufficient to cover
costs
• Decline in property value
• All material expenditure subject to
authorisation regime
• Capital expenditure subject to regular
review
8
Potential Risk Impact Mitigation
Changes to legal environment,
planning law or local planning
policy
• Adverse impact on portfolio
• Loss of development
opportunity
• Reduction in realisation
value of assets
• Monitoring of UK property environment
and regulatory proposals
• Close liaison with agents and advisers
• Membership of and dialogue with
relevant industry bodies
Failure to comply with regulatory
requirements in connection with
property portfolio, including health,
safety and environmental
• Tenant and third-party
claims resulting in financial
loss
• Reputational damage
• Guidance on regulatory requirements
provided by managing agents and
professional advisers
• Individual properties monitored by asset
managers and agents
• Managing agents operate formal
regulatory certification process for
residential accommodation
• Ongoing programme of risk assessments
for key multi-tenanted sites
• Key risks covered by insurance policies
Corporate Governance &
Management
Non-availability of information
technology systems or failure of
data security
• Impact on operations and
reporting ability
• Financial claims arising from
• leak of confidential
information
• Provision of effective security regime
with automatic off-site data and systems
back-up
Financial and property market
conditions
• Insufficient finance available
at acceptable rates to fulfil
business plans
• Inability to execute
investment property disposal
strategy owing to fall in
property market values
• Financial impact of debt
interest
• Breach of banking covenants
• The Group is debt-free and debt
finance has not been required.
• Finance risks reduced with provision of
cash reserve
• Impact of interest rates on property
yields monitored
Operational Controls
During the year, the directors continued to recognise that the Company’s ability to operate successfully
is largely dependent on the maintenance of its straightforward approach to doing business and its
reputation for integrity. All those who act on the Company’s behalf are required to behave and transact
business in accordance with the highest professional standards. As well as compliance with all relevant
regulatory requirements, this extends to customer care and external complaint guidelines. The
Company has adopted a Code, Policy and Procedures under the Market Abuse Regulation. During the
period the employee responsible for operations reduced working hours and the majority of the
operations were contracted to Eddisons Property Management. Eddisons have looked after the property
management for previous years and include the provision of all applicable compliance procedures. The
directors were satisfied that the governance procedures adopted by Eddisons in relation to its clients
were appropriate and protected the Company’s interests. The Company’s corporate governance regime
is underpinned by a whistle-blowing procedure, enabling perceived irregularities to be notified to
members of the Board, principally the senior independent non-executive director.
The Board has overall responsibility for the Company’s internal control systems and for monitoring its
effectiveness. The Board’s approach is designed to manage rather than eliminate the risk of failure to
achieve business objectives and can only provide reasonable assurance against material
misstatements or loss. The directors have not considered it appropriate to establish a separate internal
audit function, having regard to the Company’s size. The Board’s approach to internal controls covers
all companies within the Group and there are no associate or joint venture entities which it does not
cover.
9
The principal foundations of the Company’s internal control framework during the reporting period were:
• statements of areas of responsibility reserved to the directors, with prescribed limits to executive
authority to commit to expenditure and borrowing;
• effective committee structure with terms of reference and reporting arrangements to the Board;
• clear remits for the delegation of executive direction and internal operational management functions;
• framework for independent directors to provide advice and support to executive directors on an
individual basis;
• top-level risk identification, evaluation and management framework;
• effective systems for authorising capital expenditure and significant revenue items and monitoring
actual cost incurred;
• ongoing reporting to the Board of operational activity and results;
• regular review of operational forecasts and consideration by the directors;
• ongoing reporting to the directors on health, safety and environmental matters.
The Board reviews the effectiveness of the Company’s risk management systems against the principal
risks facing the business and their associated mitigating factors, taking account of the findings and
recommendations of the auditors at the Company’s half-year and year-end. Following its review of the
auditors’ findings during the reporting period, the Board considers that the Company’s approach
remains effective and appropriate for a business of the Company’s size and complexity.
Key Contracts
There are currently no contracts which require third party approval for any change to the nature,
constitution, management or ownership of the business. The appointment agreements of directors do
not contain any provisions specifically relating to a change of control.
Charitable and Political Donations
During the reporting period the Group made no donations for charitable or political purposes (2021: nil)
Section 172 Companies Act 2006
The Directors acknowledge their duty under s.172 of the Companies Act 2006 and consider that they
have, both individually and together, acted in the way that, in good faith, would be most likely to promote
the success of the Company for the benefit of its members as a whole. In doing so, they have had regard
(amongst other matters) to:
• the likely consequences of any decision in the long term. The Group’s long-term investment strategy
is shown in the Chairman’s Report, with associated risks highlighted in the Strategic report.
• the impact of the Group’s operations on the community and the environment. The Group operates
honestly and transparently. We consider the impact on the environment on our day-to-day
operations and how we can minimise this.
• the desirability of the Group maintaining a reputation for high standards of business conduct. Our
intention is to behave in a responsible manner, operating within the high standard of business
conduct and good corporate governance, as highlighted in the Corporate Governance Statement
on page 12
• the need to act fairly as between members of the Group. Our intention is to behave responsibly
towards our shareholders and treat them fairly and equally so that they may benefit from the
successful delivery of our strategic objectives.
This Financial Review was approved by the directors on 26 May 2023.
Duncan Soukup, Chairman
31 May 2023
10
11
Corporate Responsibility Statement
During the year we continued to focus on the three principal contributors to the success of our business:
• the talent and commitment of our executives;
• our relationships with national and local advisers, partners and clients; and
• the well-being of the businesses that occupy our properties and the communities in which they
operate.
The directors remain conscious that the Group’s ability to operate effectively rests on our reputation for
fairness and a straightforward and honest approach to conducting business. We therefore strive to
transact business in accordance with the highest professional standards and all those who act on our
behalf are expected to do the same. Besides complying with all relevant legislation and professional
guidelines, this includes customer care and external complaint procedures.
We have again considered whether it is appropriate to report on relevant human rights issues. In the
context of our business and the reduced size of our investment portfolio, we do not believe that the
provision of detailed information in this area would provide any meaningful enhancement to the
understanding of the performance of our business. However, we are confident that our approach to
doing business does not contravene any human rights principles or applicable legislation.
Our approach to corporate responsibility matters is underpinned by a whistle-blowing procedure,
enabling perceived irregularities to be notified to directors, principally the independent non-executive
directors.
Employees
On 7 February 2022, Gareth Edwards resigned as a director and was replaced by Tim Donell.
Diversity
The Group has a formal diversity and equal opportunities policy in place and is committed to a culture
of equal opportunities for all regardless of age, race or gender. The Board currently comprises three
male directors.
Health, Safety and Welfare
The directors were responsible for ensuring that the Group discharged its obligations for health, safety
and welfare during the reporting period, including matters delegated to the Group’s managing agents
and other contractors. No material health, safety and welfare incidents were notified during the period.
Our property managers and contractors continued to be required to ensure that property management,
maintenance and construction activities conform to all relevant regulations, with due consideration being
given to the welfare of occupants and neighbours.
Environmental, Social and Governance
We have always believed that our local asset model is by its nature supportive of reducing the carbon
impact of retail shopping. Our past development activity has been aimed at returning to profitable use
redundant space that would otherwise remain vacant, potentially relieving development pressure on
greenfield sites elsewhere. Any development activity undertaken is carried out in accordance with
applicable energy and resource saving standards, noise impact reduction requirements, and, where
relevant, the need to preserve the character of buildings, including listed properties. Our contractors
are required to dispose of waste in accordance with best practice. We continue to take action to upgrade
the energy performance of our letting units wherever required.
It is our policy to seek to deal constructively with all stakeholders in relation to any community issues
that arise in relation to our properties. Our policy is to prefer to use local advisers, agents and
contractors whenever appropriate to do so.
12
It is our intention to review our response to environmental, social and governance factors in line with
the development of our investment policy to ensure that our policies are appropriate to the revised
strategy and operational profile. This review will take account of related issues, such as modern slavery.
Anti-Corruption and Anti-Bribery
The Company has in place an Anti-Bribery and Anti-Corruption Policy which the directors consider
fulfils UK Government guidelines for compliance with UK Bribery Act 2010.
13
Governance
Regulatory Compliance
The Company is subject to, and seeks to comply with, the Financial Conduct Authority’s (“FCA”) Listing
Rules (“Listing Rules”), the Market Abuse Regulation and the Disclosure Guidance and Transparency
Rules of the Financial Conduct Authority. The Company is also subject to the UK City Code on
Takeovers and Mergers.
In the prior period the Company adopted the Corporate Governance Code of the Quoted Companies
Alliance (the “QCA Code”). The directors consider that the QCA Code provides a corporate governance
framework proportionate to the risks inherent to the size and complexity of the Company’s operations.
The directors apply the QCA Code in the ways set out below.
Board Level Responsibility
The Company’s directors are ultimately responsible for the effective stewardship of the business, with
the Chairman holding specific responsibility for corporate governance and effective leadership of the
Board. In discharging this obligation, the Chairman regularly consults the Company’s Independent Non-
Executive Directors (who are qualified by background and experience to assist in this sphere), as well
as the Company’s legal advisers and the Company Secretary.
Conflicts of Interest
The Company’s Articles of Association provide a framework for directors to report actual or potential
situational conflicts, enabling the Board to give such situational conflicts appropriate and early
consideration. All directors are aware of the importance of consulting the Company Secretary regarding
possible situational conflicts.
Board Leadership
The Company is led by its Board, which is responsible for determining the strategy of the business and
its effective stewardship. All major strategic and investment decisions are taken by the Board as a whole,
which monitors the resources available to the Company, to ensure that they are sufficient to enable its
goals to be achieved. The Board meets regularly to review the Company’s operations and progress with
its strategy. The directors are in regular liaison outside formal meetings. Risk management and controls
are reviewed in the light of advice from the external auditors, who have access to all the directors.
The Board comprises an executive Chairman and two independent non-executive directors, as set out
below.
Duncan Soukup
Executive Chairman, aged 67
Duncan Soukup is the founder and Executive Chairman of Thalassa Holdings Ltd (“Thalassa”), a
company listed on the London Stock Exchange, and has over 35 years of investment experience. Prior
to establishing Thalassa, Mr Soukup worked in investment banking for 10 years, including as managing
director in charge of the non-US equity business of Bear Sterns. Thereafter, he established the AIM-
listed investment management business Acquisitor plc.
As the executive chairman with a beneficial interest in the Company’s shares, Mr Soukup is not
considered to be independent.
Martyn Porter (Appointed May 2022)
Non-Executive Director, aged 52
Martyn has over 25 years' experience in international banking and financial services with the HSBC
Group. He has held senior leadership positions in the UK, Malta, the Philippines, Hong Kong, Vietnam,
Luxembourg and latterly Monaco, where he served as Chief Executive Officer of the HSBC Private
Bank and Asset Management companies. As a board director and regulated officer of HSBC companies
in Ireland, Luxembourg and Monaco, Mr. Porter has significant knowledge and understanding of
corporate governance and regulatory compliance. He also has a highly successful track record in the
leadership of businesses undergoing complex strategic change and transformation. During his career,
14
Mr. Porter has built a wide and diverse network of business relationships, as well as demonstrating
strong values and business ethics.
Tim Donell (Appointed February 2022)
Non-Executive Director, aged 41
A certified chartered accountant, Tim has over 15 years' experience in finance, accounting and
management roles within growth companies across travel, e-commerce and web technology and has
a demonstrated track record of developing and improving financial processes to drive business
performance.
Division of Responsibilities
The responsibilities of each director are set out clearly in the director’s letter of appointment, which is
available for inspection by members of the Company at its registered office during normal office hours.
All directors ensure that they provide sufficient time to fulfil their obligations. All directors have access
to the advice and services of the Company Secretary and to independent legal advice at the Company’s
expense.
During the reporting period the directors monitored the Company’s operational progress and the
activities of the executive management.
The Chairman is responsible for ensuring that due
consideration is given to key items of business both at formal meetings of the directors and liaison
outside these. The independent non-executive directors provide a separate communication channel
for shareholders and other interested parties and has a remit under the Company’s “whistle-blowing”
arrangements.
Nomination, Audit and Remuneration Committees were in place throughout the reporting period, with
responsibility for specific areas within the Company’s overall corporate governance structure. During
the reporting period there was no requirement for either of the Remuneration Committee or the
Nomination Committee to meet.
The Board met and held discussions throughout the year. The frequency of the meetings fluctuated as
required. The meetings consisted of discussion to agree strategy and the handling of the assets. The
majority of the meetings were on an informal and operational basis with the conclusions appropriately
documented.
Aside from the meetings described above each director’s attendance record at Board and Committee
meetings during the reporting period is set out in the table below:
Director Board Audit Remuneration Nomination
Duncan Soukup 3 1 n/a n/a
Tim Donell 3 1 n/a n/a
Martyn Porter 3 n/a n/a n/a
Under the Company’s Articles one-third of the directors are subject to retirement at each Annual
General Meeting. Additionally, the Articles require that director appointments made by the Board
directors are ratified at the subsequent General Meeting of the Company.
Arrangements are made to provide new directors with an induction programme into the Company’s
activities. Non-executive directors also meet with management on an informal basis. Arrangements are
made for directors to inspect investment properties.
Risk & Internal Control
In addressing its responsibilities in this area, the Board pays particular attention to:
• monitoring the integrity of the Company’s financial statements and formal announcements relating to
its financial performance and reviewing significant financial reporting judgements contained in
them;
15
• reviewing the adequacy and effectiveness of the Company’s internal financial controls, internal
control and risk management systems, fraud detection, regulatory compliance and whistle-blowing
arrangements;
• making recommendations for the approval of shareholders on the appointment, re- engagement or
removal of the external Auditors and approving the Auditors’ terms of engagement and
remuneration;
• overseeing the Company’s relationship with the external Auditors, reviewing and monitoring the
Auditors’ independence and objectivity and effectiveness;
• approving the annual audit plan and reviewing the Auditors’ findings and the effectiveness of the audit
programme.
The Company’s approach to risk management is set out on pages 9 and 10.
Directors’ Remuneration Policy and Remuneration Implementation Report
There was no requirement for the Remuneration Committee to meet during the reporting period. The
Company had no employee directors during the year and no share-related incentive schemes were in
operation. Although it is not currently required, the remuneration policy for employee directors
summarised below was approved by shareholders at the annual general meeting held in March 2020:
• within a competitive market, enabling the recruitment and retention of individuals whose talent
matches the entrepreneurial and leadership needs of the business, enabling the Company to fulfil
its investment objectives for its shareholders; and
• placing emphasis on performance-related rewards and focusing on incentive targets that are closely
aligned with the interests of shareholders.
Base Salary To be pitched at market median for the role, with advice taken
from independent consultants.
Termination Service contracts to be capable of termination at not more than
one
y
ear’s notice
Annual Bonus Scheme Future scheme to be based on the achievement of
profitability and cash generation targets based on the Company’s
annual budget.
Individual awards to be capped at 100% of base salary.
Share Based Performance Scheme Scheme to be based on the award of shares or cash equivalent.
Awards to vest on the achievement of medium-term and long-
term targets derived from the Company’s investment strategy.
Pension Company contribution to individuals’ pension plans of up to 10%
of base salary.
Health Plan Individuals may participate in private healthcare
arrangements supplied by the Company.
In applying the remuneration policy, the Board will use its discretion to provide a tailored mix of benefits
that encourages individuals to maximise their efforts in the best interests of shareholders. In particular,
the remuneration policy would be subject to any special considerations that may arise in relation to the
execution of any revised investment policy approved by the Company’s shareholders.
Non-Executive Pay
The Company’s policy has been to provide remuneration to its non-executive directors commensurate
with the need to attract and retain individuals with levels of skill and experience appropriate to the
Company’s needs. No non-executive directors have participated in any bonus or share-based
arrangements of the Company.
16
Directors’ Remuneration
The below table highlighted total directors’ remuneration in the period.
Director Salary Short term
incentives
Long term
incentives
Pension
contributions
Benefits in
kind
Total
Duncan Soukup - - - - - -
Tim Donell 4,000 4,000
Mart
y
n Porter 3,438 3,438
Total 7,438 - - - - 7,438
The aggregate directors’ remuneration during the reporting period was £7,438 (2021: £10,000).
Directors’ Service Contracts
Non-executive directors Date of initial
appointmen
t
Date of current
appointment letter
Duncan Soukup 4 October 2019 27 Feb 2021
Tim Donell 7 Februar
y
2022 21 October 2022
Mart
y
n Porter 20 Ma
y
2022 20 Ma
y
2022
Directors’ Interests in the Company’s Shares (audited)
The interests during the reporting period of the directors who held office during the reporting period in
the issued share capital of the Company as at the date of this report are set out below:
Ordinar
y
1p Shares*
Directo
r
2022 2021
Duncan Soukup 5,418,857 5,418,857
Tim Donell - -
Mart
y
n Porter - -
In addition to the direct interest shown above, Duncan Soukup has an indirect interest in 4,618,001 and
1,734 Ordinary Shares arising from his interests in entities of Thalassa Discretionary Trust, and
Thalassa Holdings Ltd.
Directors’ Indemnities and Insurance Cover
To the extent permitted by law, the Company indemnifies its directors and officers against claims arising
from their acts and omissions related to their office. The Company also maintains an insurance policy
in respect of claims against directors.
Audit Committee Report
The Audit Committee, consisted of the independent non-executive directors. The key functions of the
audit committee are for monitoring the quality of internal controls and ensuring that the financial
performance of the Group is properly measured and reported on and for reviewing reports from the
Company’s auditors relating to the Company’s accounting and internal controls, in all cases having due
regard to the interests of Shareholders. The Committee has formal terms of reference.
The financial statements attached to this report have been prepared on the Going Concern basis. In
deciding that the Going Concern basis is appropriate, the directors reviewed projections of future activity
over the 12 months following the date of this report. The Directors concluded that there were no
identifiable material uncertainties, and present cash reserves were sufficient to meet all liabilities as
they fall due, up to and beyond that date.
The Committee considered the following items:
• ensuring that the format of the financial statements and the information supplied meets the
standards set by the International Accounting Standards Board;
17
• reviewing the accounting treatment of receivables and ensuring effective co-ordination between the
Company’s records and those of its managing agents;
• ensuring that the audit scope properly reflected the risk profile of the business;
• ensuring that the Committee’s terms of reference continued to accord with regulatory requirements.
The Committee considered the independence of external auditors, seeking to ensure that any non-audit
services provided, by external auditors do not impair the auditors’ objectivity or independence. The
Company’s auditors, RPG Crouch Chapman, did not supply any non-audit services to the Company
during the period.
Having assessed the performance, objectivity and independence of the auditors, as well as the audit
process and approach taken, the Committee recommended the re-appointment RPG Crouch Chapman
at the Company’s annual general meeting in 2023.
Duncan Soukup
Executive Director acting as Audit Committee Chairman 31 May 2023
18
Directors’ Report
The directors of Alina Holdings Plc (“the Company”) present their report and the audited financial
statements of the Company together with its subsidiaries and associated undertakings (“the Group”)
for the year ended 31 December 2022.
The following directors held office during the reporting period:
Gareth Edwards (appointed 4 October 2019 and resigned 7 February 2022)
Duncan Soukup (appointed 4 October 2019)
Tim Donell (appointed 7 February 2022)
Martyn Porter (appointed 20 May 2022)
The Directors’ Report also includes the information set out on pages 5 to 25, together with the
description of the Company’s investment policy and business model described on page 5.
Group Result and Dividend
The loss for the Group attributable to shareholders for the period was £136,000 (2021: loss
£294,000). In accordance with the investment policy, no dividend has been or will be distributed in
respect of the financial year. The directors continue to keep the dividend distribution policy under
review.
Post Balance Sheet Events
• Sale of Oldham property classified as an asset held for resale at the year-end (see note 11);
• Commencement of legal action against The Italian Way, a tenant in Hastings, for breach of lease
covenants.
Going Concern Basis
The financial statements attached to this report have been prepared on the Going Concern basis. In
deciding that the Going Concern basis is appropriate, the directors reviewed projections of future activity
over the 12 months following the date of this report. The Directors concluded that there were no
identifiable material uncertainties, and present cash reserves were sufficient to meet all liabilities as
they fall due, up to and beyond that date.
Share Capital
Details of the Company’s issued share capital are set out in note 17 to the financial statements. All of the
Company’s issued shares are listed on the London Stock Exchange. The Company’s share capital
comprises one class of Ordinary Shares of 1p each. All issued shares are fully paid up and rank equally
and there are no restrictions on the transfer of shares or the size of holdings. The directors are not
aware of any agreements between shareholders in relation to the Company’s shares.
Substantial Interests
As at [19] May 2023, the last practicable reporting date before the production of this document, the
Company’s share register showed the following major interests (of 3% or more, excluding shares held
in treasury) in its issued share capital:
Shareholde
r
Ordinar
y
Shares %
Vidacos Nominees Limited* 10,036,857 44.22
HSBC Global Custod
y
Nominee
(
UK
)
Limited** 6,718,785 29.60
Ferlim Nominees Limited 1,220,000 5.38
*Included within Vidacos Nominees Limited are shares of 5,418,857 owned by C D Soukup and
4,618,001 held by Thalassa Discretionary Trust.
* * The Company has also been notified that 6,391,223 (28.16%) shares are beneficially owned by
Peter Gyllenhammar AB.
19
Investor Relations
Subject to regulatory constraints, the directors are keen to engage with the Company’s shareholders,
placing considerable emphasis on effective communications with the Company’s investors. Directors
are happy to comply with shareholder requests for meetings as soon as practicable, subject to regulatory
constraints. The Board is provided with feedback on such meetings, as well as regular commentary from
investors and the Company’s bankers and advisers. The Board provides reports and other
announcements via the regulatory news service in accordance with regulatory requirements.
Regulatory announcements and key publications can also be accessed via the Company’s website.
The Company’s Annual General Meeting provides a further forum for investors to discuss the
Company’s progress. The Company complies with relevant regulatory requirements in relation to
convening the meeting, its conduct and the announcement of voting on resolutions. The Annual Report
and Notice of the Annual General Meeting are sent to shareholders at least 21 working days prior to the
meeting and are available on the Company’s website. The results of resolutions considered at the
Annual General Meeting are announced to the Stock Exchange and are also published on the website
and lodged with the National Storage Mechanism. Investors may elect to receive communications from
the Company in electronic form and be advised by email that communications may be accessed via the
Company’s website.
Whistleblowing Policy
The Group has in place a whistleblowing policy which sets out the formal process by which an employee
of the Group may in confidence raise concerns about possible improprieties in the Group’s affairs,
including financial reporting.
Emissions and Energy Consumption Reporting
The directors believe that the Company’s outsourced business model, which focusses on the
employment of agents, advisers and contractors who are local to our property assets, is inherently
environmentally friendly. However, the collection of consumption data from such businesses is not
practicable. It is also not possible for our national agents and advisers to separately identify such data
in relation to the proportion of their work devoted to the Company’s activities, particularly given the
increase in staff working from home since the COVID-19 lockdowns. It is not possible to measure the
energy consumed by the Company’s tenants (nor is this consumption within the Company’s control).
The consumption of water, waste output and greenhouse gases other than CO
2
within the Company’s
control is negligible.
For previous reporting periods the Company has supplied environmental reporting information focused
on energy consumed by the Company and its wholly owned subsidiaries through the activities of its office
base, shared facilities provided by the Company within its property portfolio and activities within vacant
properties within the Company’s control.
In relation to Scope 1 Carbon Emissions (consumption of gas and fuel), since the termination of the
Company’s third-party investment advisory agreement and the relocation of its registered office it has
not been possible to separately identify the energy consumed on the Company’s activities.
An element
of the Company’s administration activity is carried out at its registered office. However, this is a de
minimis element of the overall activity and energy consumption at that site. Other activity is undertaken
by the Company’s directors and management working at home. In both cases, it has not been possible
to separately identify the energy consumed on the Company’s activities at those locations. In previous
years, data has been supplied relating to fuel consumed on journeys on Company activities. As the
Company does not operate company cars, all such journeys are made in employees’ private vehicles
or on public transport. The reduction in the Company’s property portfolio has significantly reduced the
requirement for such journeys, which were then further restricted during the reporting period by the
COVID-19 lockdown regime. Accordingly, the directors do not consider that any meaningful Scope 1
data can be supplied.
Similar limitations apply to Scope 2 data, which in previous reports comprised an estimate of
consumption for vacant property units for which the Company is responsible. The number of these and
the related energy consumption has been de minimis throughout the reporting period. Similarly, it has
not been practicable to measure Scope 3 emissions.
20
The Company’s direct usage and emissions of water is also minimal. Although a small element of utility
supply charges within vacant premises relate to water and to gas, this largely relates to standing charges
and consumption is negligible.
In relation to The Companies (Directors’ Report) and LLP Partnerships (Energy and Carbon Report)
Regulations 2018, the Company consumes less than 40,000 kWh of energy per annum and therefore
qualifies as a low energy user and therefore does not come within the scope of those regulations.
Statement of Disclosure to Auditors
The directors who were in office at the date of the approval of the financial statements have confirmed
that, as far as they are aware, there is no relevant audit information of which the auditors are unaware.
Each of the directors has confirmed that they have taken all necessary steps that they ought to have
taken as directors in order to make themselves aware of any relevant audit information and to establish
that this has been communicated with the auditors.
This report was approved by the directors on 31 May 2023
Alasdair Johnston
Company Secretary 31 May 2023
21
Statement of Directors’ Responsibilities
The directors are responsible for preparing the Annual Report and the Group and parent Company
financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare Group and parent Company financial statements for
each financial year. Under that law they are required to prepare the Group financial statements in
accordance with UK Adopted International Accounting Standards and applicable law and have elected
to prepare the parent Company financial statements in accordance with UK accounting standards,
including FRS 102 The Financial Reporting Standard applicable in the UK.
Under company law the directors must not approve the financial statements unless they are satisfied
that they give a true and fair view of the state of affairs of the Group and parent Company and of their
profit or loss for that period. In preparing each of the Group and parent Company financial statements,
the directors are required to:
• select suitable accounting policies and then apply them consistently;
• make judgements and estimates that are reasonable, relevant, reliable and prudent;
• for the Group financial statements, state whether they have been prepared in accordance with UK
Adopted International Accounting Standards;
• for the parent Company financial statements, state whether applicable UK accounting standards
have been followed, subject to any material departures disclosed and explained in the parent
company financial statements;
• assess the Group and parent Company’s ability to continue as a going concern, disclosing, as
applicable, matters related to going concern; and
• use the going concern basis of accounting unless they either intend to liquidate the Group or the
parent Company or to cease operations or have no realistic alternative but to do so.
The directors are responsible for keeping adequate accounting records that are sufficient to show and
explain the parent Company’s transactions and disclose with reasonable accuracy at any time the
financial position of the parent Company and enable them to ensure that its financial statements comply
with the Companies Act 2006. They are responsible for such internal control as they determine is
necessary to enable the preparation of financial statements that are free from material misstatement,
whether due to fraud or error, and have general responsibility for taking such steps as are reasonably
open to them to safeguard the assets of the Group and to prevent and detect fraud and other
irregularities.
Under applicable law and regulations, the directors are also responsible for preparing a Strategic
Report, Directors’ Report, Directors’ Remuneration Report and Corporate Responsibility Statement that
complies with that law and those regulations.
The directors are responsible for the maintenance and integrity of the corporate and financial
information included on the company’s website. Legislation in the UK governing the preparation
and dissemination of financial statements may differ from legislation in other jurisdictions.
22
Responsibility statement of the directors in respect of the annual financial report
We confirm that to the best of our knowledge:
• the financial statements, prepared in accordance with the applicable set of accounting standards,
give a true and fair view of the assets, liabilities, financial position and profit or loss of the company
and the undertakings included in the consolidation taken as a whole; and
• the strategic report/directors’ report includes a fair review of the development and performance of
the business and the position of the issuer and the undertakings included in the consolidation taken
as a whole, together with a description of the principal risks and uncertainties that they face.
We consider the annual report and accounts, taken as a whole, is fair, balanced and understandable
and provides the information necessary for shareholders to assess the group’s position and
performance, business model and strategy.
The foregoing reports were approved by the directors on 31 May 2023
Alasdair Johnston
Company Secretary 31 May 2023
23
Independent Auditors’ Report to the members of
Alina Holdings PLC
Opinion
We have audited the financial statements of Alina Holdings Plc (the ‘Company’) and its subsidiaries
(the ‘Group’) for the year ended 31 December 2022 which comprise the Consolidated Statement of
Income, Consolidated Statement of Comprehensive Income, Consolidated Statement of Financial
Position, Consolidated Statement of Cash Flows, Consolidated Statement of Changes in Equity,
Company Balance Sheet , and notes to the financial statements, including a summary of significant
accounting policies. The financial reporting framework that has been applied in their preparation is
applicable law and International Financial Reporting Standards as adopted in the United Kingdom
(IFRS) for the Group and UK accounting standards, including FRS 102 The Financial Reporting
Standard applicable in the UK (UK GAAP).
In our opinion, the financial statements:
• give a true and fair view of the state of the Group’s and of the Company’s affairs as at 31 December
2022 and of the Group’s loss for the year then ended;
• have been properly prepared in accordance with IFRS for the Group, and UK GAAP for the
Company; 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.
Conclusions relating to going concern
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 evaluation of the Directors’ assessment of the entity’s ability to continue to adopt the going concern
basis of accounting included review of the expected cashflows for a period of 18 months from the
balance sheet date compared with the liquid assets held by the Group.
Based on the work we have performed, we have not identified any material uncertainties relating to
events or conditions that, individually or collectively, may cast significant doubt on the Group's or the
Company's ability to continue as a going concern for a period of at least twelve months from when the
financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described
in the relevant sections of this report.
24
Independent Auditors’ Report to the members of Alina Holdings PLC (continued)
Our approach to the audit
In planning our audit, we determined materiality and assessed the risks of material misstatement in the
financial statements. In particular, we looked at where the directors made subjective judgements, for
example in respect of significant accounting estimates. As in all of our audits, we also addressed the
risk of management override of internal controls, including evaluating whether there was evidence of
bias by the directors that represented a risk of material misstatement due to fraud.
We tailored the scope of our audit to ensure that we performed sufficient work to be able to issue an
opinion on the financial statements as a whole, taking into account the structure of the group and the
parent company, the accounting processes and controls, and the industry in which they operate.
We performed the audits of the Company and its subsidiaries.
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 we identified (whether or not due to fraud), including those 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. The matter identified was 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.
Key audit matter How our work addressed this matter
Carrying value of property
The Group held £3.3m (2021: £3.1m) of
properties, including £0.8m (2021: £0.3m) of
properties held for sale.
Investment properties are held at fair value, which
represents a significant are of management
judgement. Properties held for sale are held at net
realisable value.
Given the subjectivity of estimates involved, we
consider the carrying value of property to be a key
audit matter.
Our work included:
• Reviewing the recognition and fair value
measurement of investment properties in
accordance with IAS 40 Investment Property
and IFRS13 Fair Value Measurement;
• Agreeing assumed rates of rent per square
foot to actual rates achieved in adjacent units;
• Reviewing management estimates for
occupancy and timing of renovation works;
• Reviewing management’s assessment of the
range of values for property held for
development; and
• Reviewing sales and associated costs
subsequent to the balance sheet date.
Carrying value of investment in subsidiaries
The Company held £3.1m (2021: £3.1m) of
investments in subsidiaries.
The directors are required to review the carrying
value of investments for impairment annually.
Given the subjective nature of the related
estimates and judgements, we consider the
carrying value of available for sale investments to
be a key audit matter.
Our work included:
• Reviewing the underlying valuation of assets
held by subsidiaries; and
• Reviewing rental yields calculated by
management.
25
Independent Auditors’ Report to the members of Alina Holdings PLC (continued)
Our application of materiality
We apply the concept of materiality both in planning and performing our audit, and in evaluating the
effect of misstatements. We consider materiality to be the magnitude by which misstatements, including
omissions, could influence the economic decisions of reasonable users that are taken on the basis of
the financial statements.
In order to reduce to an appropriately low level the probability that any misstatements exceed
materiality, we use a lower materiality level, performance materiality, to determine the extent of testing
needed. Importantly, 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.
We consider gross assets to be the most significant determinant of the Group’s financial performance
used by the users of the financial statements. We have based materiality on 1.5% of gross assets for
each of the operating components. Overall materiality for the Group was therefore set at £0.1m. For
each component, the materiality set was lower than the overall group materiality.
We agreed with the Audit Committee that we would report on all differences in excess of 5% of
materiality relating to the Group financial statements. We also report to the Audit Committee on financial
statement disclosure matters identified when assessing the overall consistency and presentation of the
consolidated financial statements.
Other information
The directors are responsible for the other information. The other information comprises the information
included in the annual report, other than the financial statements and our auditor’s report thereon. Our
opinion on the financial statements does not cover the other information and, except to the extent
otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If
we identify such material inconsistencies or apparent material misstatements, we are required to
determine whether there is a material misstatement in the financial statements or a material
misstatement of the other information. If, based on the work we have performed, we conclude that there
is a material misstatement of this other information, we are required to report that fact. We have nothing
to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of 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.
26
Independent Auditors’ Report to the members of Alina Holdings PLC (continued)
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the group and the parent company and its
environment obtained in the course of the audit, we have not identified material misstatements in the
strategic report or the directors’ report.
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 from branches not visited by us; or
• the parent company financial statements are not in agreement with the accounting records and
returns; or
• certain disclosures of directors’ remuneration specified by law are not made; or
• we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors’ responsibilities statement set out on page 25 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.
Those charged with governance are responsible for overseeing the Company's financial reporting
process.
Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole
are free from material misstatement, whether due to fraud or error, and to issue our opinion in an
auditor’s report. Reasonable assurance is a high level of assurance, but does not 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
the financial statements.
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. The extent to which our procedures are capable of detecting
irregularities, including fraud, is detailed below:
• We obtained an understanding of the legal and regulatory frameworks within which the Group
operates focusing on those laws and regulations that have a direct effect on the determination of
material amounts and disclosures in the financial statements.
• We identified the greatest risk of material impact on the financial statements from irregularities,
including fraud, to be the override of controls by management. Our audit procedures to respond to
these risks included enquiries of management about their own identification and assessment of the
risks of irregularities, sample testing on the posting of journals and reviewing accounting estimates
for biases.
27
Independent Auditors’ Report to the members of Alina Holdings PLC (continued)
Auditor’s responsibilities for the audit of the financial statements (continued)
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities,
including those leading to a material misstatement in the financial statements or non-compliance with
regulation. This risk increases the more that compliance with a law or regulation is removed from the
events and transactions reflected in the financial statements, as we will be less likely to become aware
of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud
rather than error, as fraud involves intentional concealment, forgery, collusion, omission or
misrepresentation.
A further description of our responsibilities for the audit of the financial statements is located on the
Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms
part of our Auditor's Report.
Other matters that we are required to address
We were appointed on 12 April 2023 and this is the first year of our engagement as auditors for the
Group.
We confirm that we are independent of the Group and have not provided any prohibited non-audit
services, as defined by the Ethical Standard issued by the Financial Reporting Council.
Our audit report is consistent with our additional report to the Audit Committee explaining the results of
our audit.
Use of our report
This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part
16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the
company’s members those matters we are required to state to them in an auditor’s report and for no
other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to
anyone other than the company and the company’s members, as a body, for our audit work, for this
report, or for the opinions we have formed.
Paul Randal ACA (Senior Statutory Auditor)
For and on behalf of RPG Crouch Chapman LLP
Chartered Accountants
Registered Auditor
5
th
Floor, 14-16 Dowgate Hill
London
EC4R 2SU
31 May 2023
28
Consolidated Statement of Income
For the year ended 31 December 2022
Year ended 31
December 2022
Year ended 31
December 2021
Note £000 £000
Gross rental income
Property operating expenses 4 (300 ) (136 )
Net rental income 51 301
Profit/Loss on disposal of investment properties 5 4 -
Gain from change in fair value of investment properties 11 563 -
Administrative expenses including non-recurring items 6 (604 ) (540 )
Operating loss before net financing costs 14 (239 )
Depreciation 11 (3 ) (3 )
Financing income 8 318 23
Financing expenses 8 (470 ) (75 )
Share of profits of associated entities 23 5 -
Loss before tax (136 ) (294 )
Taxation - -
Loss for the period from continuing operations (136 ) (294 )
Loss for the year (136 ) (294 )
Attributable to:
Equity shareholders of the parent (136 ) (294 )
Non-controlling interest
(136 ) (294 )
Earnings per share - GBP pence (using weighted
average number of shares)
Basic and Diluted - GBP pence 10 (0.60 ) (1.30 )
The notes on pages 32 to 51 form an integral part of this consolidated financial information.
29
Consolidated Statement of Comprehensive Income
For the year ended 31 December 2022
Year ended 31
December 2022
Year ended 31
December 2021
£000 £000
Loss for the financial year (136 ) (294 )
Other comprehensive income:
Total comprehensive income (136 ) (294 )
Attributable to:
Equity shareholders of the parent (136 ) (294 )
Non-Controlling interest - -
Total Comprehensive income (136 ) (294 )
The notes on pages 32 to 51 form an integral part of this consolidated financial information.
30
Consolidated Statement of Financial Position
As at 31 December 2022
Year Ended 31
December 2022
Year Ended 31
December 2021
Note £000 £000
Assets
Non-current assets
Investment properties 11 2,504 2,784
Investments in associated entities 23 5 -
Total non-current assets 2,509 2,784
Current assets
Investment property held for sale
11 800 330
Available for sale financial assets 12 2,597 1,819
Trade and other receivables 13 233 255
Cash and cash equivalents 14 873 1,767
Total current assets 4,503 4,171
Liabilities
Current liabilities
Trade and other payables 15 591 398
Total current liabilities 591 398
Net current assets 3,912 3,773
Non-current liabilities
Finance lease liabilities 16 324 324
Total non-current liabilities 324 324
Net assets 6,097 6,233
Shareholders’ Equity
Share capital 21 319 319
Capital redemption reserve 21 598 598
Retained earnings
Total shareholders' equity 6,097 6,233
The notes on pages 32 to 51 form an integral part of this consolidated financial information.
These financial statements were approved by the board on 31 May 2023.
Signed on behalf of the board by:
Duncan Soukup
31
Consolidated Statement of Cash Flows
For the year ended 31 December 2022
Notes
Year ended 31
December 2022
Year ended 31
December 2021
£000 £000
Cash flows from operating activities
Profit/(Loss) for the year before taxation
Gain from change in fair value of investment properties 11 (563 ) -
(Profit)/Loss from change in fair value of head leases
(3 ) 26
(Profit)/Loss on disposal of investment properties
(4 ) -
Net financing loss/(income)
Decrease/(Increase) in trade and other receivables 13 22 (27 )
(Decrease)/Increase in trade and other payables 15 164 (168 )
Loss on foreign exchange
Lease liability interest
(23 ) (22 )
Interest received
Interest paid
(19 ) (6 )
Profit from change in fair value of investments held for sale
Cash generated by operations (94 ) (487 )
Taxation
Net cash flow from operating activities (94 ) (487 )
Purchase of investments held for sale 12 (1,206 ) (1,993 )
Sale of investments held for sale 12 - 200
Unrealised Gain or (Loss) on Investment
Net Proceeds from sale of investment properties
Net cash flow in investing activities (803 ) (1,793 )
Cash flows from financing activities
(Increase)/reduction on head lease liabilities 16 3 (26 )
Net cash flow from financing activities - continuing operations 3 (26 )
Net increase in cash and cash equivalents
(894 ) (2,306 )
Cash and cash equivalents at the start of the year
Effects of exchange rate changes on cash and cash equivalents - -
Cash and cash equivalents at the end of the year 873 1,767
The notes on pages 32 to 51 form an integral part of this consolidated financial information.
32
Consolidated Statement of Changes in Equity
For the year ended 31 December 2022
Capital
Share
Redemption Retained
Capital Reserves Reserves Earnings Total
£000 £000 £000 £000 £000
Balance as at 31 December 2020 319 - 598 5,610 6,527
Total comprehensive income for the year -
(294 ) (294 )
Balance as at 31 December 2021 319 - 598 5,316 6,233
Total comprehensive income for the year - - - (136 ) (136 )
Balance as at 31 December 2022 319 - 598 5,180 6,097
The notes on pages 32 to 51 form an integral part of this consolidated financial information.
33
Notes to the Consolidated Financial Statements
1 General information
London Stock Exchange. It is incorporated, domiciled and registered in England
registered number is 05304743 and the address of its registered office is Eastleigh Court, Bishopstrow,
2 Significant Accounting policies
The Group prepares its accounts in accordance with applicable UK Adopted International Accounting
Standards.
The group financial statements consolidate those of the Company and its subsidiaries (together referred
to as the “Group”). The parent company financial statements present information about the Company
as a separate entity and not about its group.
The accounting policies set out below have, unless otherwise stated, been applied consistently to all
periods presented in these group financial statements.
Judgements made by the directors, in the application of these accounting policies that have significant
effect on the financial statements and estimates with a significant risk of material adjustment in the next
year are discussed later in this note under the heading “Use of Estimates and Judgements”.
The financial statements are prepared in pounds sterling. They have been prepared under the historical
cost convention except for the following assets which are measured on the basis of fair value:
investment properties, investment properties held for sale and available for sale financial assets.
2.1 Segmental reporting
IFRS 8 requires operating segments to be identified on the basis of internal reports that are regularly
reported to the chief operating decision maker to allocate resources to the segments and to assess
their performance. Since the strategy review in 2020 the Group has identified two reporting segments,
being investment in a portfolio of UK properties and other investment assets that are held by the Group
with the objective or adding capital appreciation in addition to our property holdings. The results of both
segments are reported to the Board of directors on a quarterly basis. The Board of directors is
considered to be the chief operating decision maker.
2.2 Basis of preparation
The consolidated financial statements include the financial statements of the Company and all its
subsidiary undertakings up to 31 December 2022. Subsidiaries are entities controlled by the Group.
The Group controls an entity when it is exposed to, or has rights to, variable returns from its involvement
with the entity and has the ability to affect those returns through its power over the entity. In assessing
control, the Group takes into consideration potential voting rights. The acquisition date is the date on
which control is transferred to the acquirer. The financial statements of subsidiaries are included in the
consolidated financial statements from the date that control commences until the date that control
ceases. The financial statements of subsidiaries are prepared using consistent accounting policies.
Inter-company transactions and balances are eliminated in full on consolidation.
2.3 Going concern
The financial information has been prepared on the going concern basis as management consider that
the Group has sufficient cash to fund its current commitments for the foreseeable future.
34
Notes to the Consolidated Financial Statements
continued
2.4 Investment Properties
Investment properties are those properties owned by the Group that are held to earn rental income or
for capital appreciation or both and are not occupied by the Company or any of its subsidiaries.
Investment properties are held at fair value, which is determined with reference to the estimated amount
for which a property should exchange on the date of valuation between a willing buyer and a willing
seller in an arm’s length transaction.
A full external valuation of the Group’s property portfolio was performed in 2020 in accordance with the
the Royal Institute of Chartered Surveyors Appraisal and Valuation Standards on the basis of market
value. This valuation reflected the state of the commercial property market resulting from the uncertainty
caused by Covid-19, which continued to have an impact on the carrying value in 2021.
During 2022 the Company sold two of its smaller properties for aggregate value of £400k. Since the
Balance Sheet date, one property has been sold.
For the year ended 31 December 2022 the Board has assessed that the fair value of its two largest
properties should be increased, as a result of the positive metrics achieved upon the recent sale of the
Group’s property in Oldham, Manchester. This resulted in increases to the carrying value of Brislington
(currently yielding ~23%) by 50% and Hastings by 25%, currently yielding~10% but with the imminent
potential for the rental income to more than double. The Board has not applied the entirety of the
valuation multiples from the sale of Oldham, leaving room for further increases on both properties.
The Company's objective is still to liquidate the current portfolio of property assets which currently show
a Gross Initial Yield of more than 16%, but as and when a sale can achieve a sensible return to
shareholders.
The Directors obtained pricing and yields of similar transactions made within the accounting period and
compared them to the Gross Initial Yield stated above. In all cases the transactions that were measured
came in at a lower value than that currently being achieved. As stated, although the data is below the
Yield being achieved it was felt prudent to leave the valuations as they stand.
Investment properties are treated as acquired at the point the Group assumes the significant risks and
returns of ownership. Subsequent expenditure is charged to the asset’s carrying value only when it is
probable that future economic benefits associated with the expenditure will flow to the Group and the
cost of each item can be reliably measured. All other repairs and maintenance costs are charged to
the Income Statement during the period in which they are incurred.
Rental income from investment properties is accounted for as described below.
2.5 Investment Properties Held for Sale
Investment properties held for sale are included in the Balance Sheet at their fair value less estimated
sales costs. In determining whether assets no longer meet the investment criteria of the Group,
consideration has been given to the conditions required under IFRS 5.
An investment property is classified as an asset as held for sale if its carrying amount will be recovered
principally through a sale transaction rather than through continuing use.
The asset must be available for immediate sale in its present condition subject only to terms that are
usual and customary for sales of such assets and its sale must be highly probable as at the year end.
35
Notes to the Consolidated Financial Statements
continued
2.6 Head Leases
Where a property is held under a head lease and is classified as an investment property, it is initially
recognised as an asset based on the sum of the premium paid on acquisition and if the remaining life
of the lease at the date of acquisition is considered to be material, the net present value of the minimum
ground rent payments. The corresponding rent liability to the leaseholder was included in the Balance
Sheet as a finance obligation in current and non-current liabilities.
The payment of head rents has been expensed through the Income Statement.
2.7 Trade and Other Receivables
Trade and other receivables are initially recognised at fair value and subsequently held at amortised
cost less impairment. Impairment is made where it is established that there is objective evidence that
the Group will not be able to collect all amounts due according to the original terms of the receivable.
The impairment is recorded in the Income Statement.
2.8 Cash and Cash Equivalents
Cash and cash equivalents comprise cash balances and deposits held on call. Cash equivalents are
short-term, highly liquid investments with original maturities of three months or less.
2.9 Financial Assets
Financial assets are impaired when there is objective evidence that the cash flows from the financial
asset are reduced.
36
Notes to the Consolidated Financial Statements
continued
2.10 Financial Instruments
Financial assets and financial liabilities are initially classified as measured at amortised cost, fair value
through other comprehensive income, or fair value through profit and loss when the Company becomes
a party to the contractual provisions of the instrument. Financial assets are derecognised when the
contractual rights to the cash flows expire, or the Company no longer retains the significant risks or
rewards of ownership of the financial asset. Financial liabilities are derecognised when the obligation is
discharged, cancelled or expires.
Financial assets are classified dependent on the Company’s business model for managing the financial
and the cash flow characteristics of the asset. Financial liabilities are classified and measured at
amortised cost except for trading liabilities, or where designated at original recognition to achieve more
relevant presentation. The Company classifies its financial assets and liabilities into the following
categories:
Financial assets at amortised cost
The Company’s financial assets at amortised cost comprise trade and other receivables. These
represent debt instruments with fixed or determinable payments that represent principal or interest and
where the intention is to hold to collect these contractual cash flows. They are initially recognised at fair
value, included in current and non-current assets, depending on the nature of the transaction, and are
subsequently measured at amortised cost using the effective interest method less any provision for
impairment.
Impairment of trade and other receivables
In accordance with IFRS 9 an expected loss provisioning model is used to calculate an impairment
provision. We have implemented the IFRS 9 simplified approach to measuring expected credit losses
arising from trade and other receivables, being a lifetime expected credit loss. This is calculated based
on an evaluation of our historic experience plus an adjustment based on our judgement of whether this
historic experience is likely reflective of our view of the future at the balance sheet date. In the previous
year the incurred loss model is used to calculate the impairment provision.
Financial liabilities at amortised cost
Financial liabilities at amortised cost comprise loan liabilities, including convertible loan note liability
elements, and trade and other payables. They are classified as current and non- current liabilities
depending on the nature of the transaction, are subsequently measured at amortised cost using the
effective interest method. All convertible loan notes are held at amortised cost and no election has been
made to hold them as fair value through profit and loss.
Financial assets at fair value through profit and loss
Financial assets at fair value are recognized and measured at fair value using the most recent available
market price with gains and losses recognised immediately in the profit and loss.
The fair value measurement of the Company’s financial and non- financial assets and liabilities utilises
market observable inputs and data as far as possible. Inputs used in determining fair value
measurements are categorised into different levels based on how observable the inputs used in the
valuation technique utilised are (the ‘fair value hierarchy’).
| Level 1 – Quoted prices in active markets |
| Level 2 – Observable direct or indirect inputs other than Level 1 inputs |
| Level 3 – Inputs that are not based on observable market data |
37
Notes to the Consolidated Financial Statements
continued
2.11 Trade and Other Payables
Trade and other payables are initially recognised at fair value and subsequently held at amortised cost.
2.12 Ordinary Share Capital
External costs directly attributable to the issue of new shares are shown in equity as a deduction from
the proceeds.
Shares which have been repurchased are classified as treasury shares and shown in retained earnings.
They are recognised at the trade date for the amount of consideration paid, together with directly
attributable costs. This is presented as a deduction from total equity. Shares held by the Employee
Benefit Trust are treated as being those of the Group until such time as they are distributed to
employees, when they are expensed in the profit and loss account.
The nominal value of shares cancelled has been taken to a capital redemption reserve.
2.13 Rental Income
Rental income from investment properties leased out under operating leases is recognised in the
Income Statement on a straight-line basis over the term of the lease. When the Group provides lease
incentives to its tenants the cost of incentives are recognised over the lease term, on a straight-line
basis, as a reduction to income.
2.14 Taxation
Corporation tax on the profit or loss for the year comprises current and deferred tax. Corporation tax is
recognised in the Income Statement except to the extent that it relates to items recognised directly in
equity, in which case it is recognised in equity.
Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or
substantively enacted at the balance sheet date and any adjustment to tax payable in respect of
previous years. Deferred tax is provided using the balance sheet liability method. Provision is made
for temporary differences between the carrying amounts of assets and liabilities in the financial
statements for financial reporting purposes and the amounts used for taxation purposes. Deferred
income tax is calculated after taking account of any indexation allowances and capital losses on an
undiscounted basis. The amount of deferred tax provided is based on the expected manner of
realisation or settlement of the carrying amount of assets and liabilities using tax rates enacted or
substantially enacted at the balance sheet date. Deferred tax assets are recognised only to the extent
that it is probable that future profits will be available against which the asset can be utilised. Deferred
tax assets are reduced to the extent that it is no longer probable that the related tax benefit will be
realised. Deferred tax assets and liabilities are only offset if there is a legally enforceable right of set-
off.
2.15 Pensions
The Company has contribution only pension arrangements in operation for certain employees.
38
Notes to the Consolidated Financial Statements
continued
2.16 Use of Estimates and Judgements
To be able to prepare accounts according to generally accepted accounting principles, management
must make estimates and assumptions that affect the asset and liability items and revenue and expense
amounts recorded in the financial statements. These estimates are based on historical experience and
various other assumptions that management and the Board of directors believe are reasonable under
the circumstances. The results of these considerations form the basis for making judgements about
the carrying value of assets and liabilities that are not readily available from other sources.
The areas requiring the use of estimates and judgements that may significantly impact the Group’s
earnings and financial position include the estimation of the fair value of investment properties.
The valuation basis of the Group’s investment properties is set out above.
2.17 Adoption of new and revised standards
Standards issued but not yet effective:
There were a number of standards and interpretations which were in issue during the current period
but were not effective at that date and have not been adopted for these Financial Statements. The
Directors have assessed the full impact of these accounting changes on the Company. To the extent
that they may be applicable, the Directors have concluded that none of these pronouncements will
cause material adjustments to the Group’s Financial Statements. They may result in consequential
changes to the accounting policies and other note disclosures. The new standards will not be early
adopted by the Group and will be incorporated in the preparation of the Group Financial Statements
from the effective dates noted below.
The new standards include:
| 1 | ||
| IFRS 17 | Insurance contracts | |
| 1 | ||
| IAS 1 | Presentation of financial statements and IFRS Practice Statement 2 | |
| 1 | ||
| IAS 8 | Accounting policies, changes in accounting estimates and errors | |
| 1 | ||
| IAS 12 | Income Taxes | |
| 2 | ||
| IFRS 16 | Leases | |
| IAS | 1 Presentation of financial statements (Amendment – Classification of Liabilities | |
| as | ||
| 2 | ||
| Current or Non-Current) | ||
| IAS 1 | Presentation of financial statements (Amendment – Non-current Liabilities with | |
| 2 | ||
| Covenants) |
| 1 | |
| Effective for annual periods beginning on or after 1 January 2023 | |
| 2 | |
| Effective for annual periods beginning on or after 1 January 2024 |
39
Notes to the Consolidated Financial Statements
continued
3 Operating Segments
As described in note 2.1, the Group’s reportable segments under IFRS8 are:
• A portfolio of UK property; and
• Other investment assets.
The disclosures by segment required by IFRS8 are as follows:
| Year ended 31 December 2022 | Year ended 31 December 2021 | |||
| UK Property | Other | UK Property | Other | |
| £000 | £000 | £000 | £000 | |
| Revenue | 351 | - | 437 | - |
| Net rental income | 51 | - | 301 | - |
| Finance income | - | 191 | - | 23 |
| Other gains and losses | 567 | - | - | |
| Finance costs | (22) | (428) | (23) | (47) |
| Depreciation | (3) | - | (3) | - |
| Segment assets | 3,304 | 2,597 | 3,114 | 1,819 |
The remaining overheads and assets are not directly attributable to either of the operating
segments.
4 Property Operating Expenses
| Year ended 31 | ||
| December 2022 | ||
| Year ended 31 | ||
| December 2021 | ||
| £000 | £000 | |
| Bad debt charge | (22) | (7) |
| Repairs | (43) | (21) |
| Business rates and council tax | (40) | (35) |
| Irrecoverable service charge | (61) | 18 |
| Utilities | (4) | (2) |
| Insurance | 23 | - |
| Managing agent fees | (65) | (26) |
| Legal & professional | (63) | (48) |
| EPC amortisation, Abortives, and Misc | (25) | (15) |
| Total property operating expenses | (300) | (136) |
40
Notes to the Consolidated Financial Statements
continued
5 Property Disposals
| Year ended 31 | ||
| December 2022 | ||
| Year ended 31 | ||
| December 2021 | ||
| Number | Number | |
| Number of Sales | 2 | - |
| £000 | £000 | |
| Average Value | 201 | - |
| Sales | ||
| Total sales | 403 | - |
| Carrying value | (370) | - |
| Profit/(Loss) on disposals before transaction costs | 33 | - |
| Transaction costs | ||
| Legal fees | (23) | - |
| Agent fees, marketing and brochure costs | (6) | - |
| Total Transaction Costs | (29) | - |
| Profit/(Loss) on disposals after transaction costs | 4 | - |
| Transaction costs as percentage of sales value | 7% | - |
6 Administrative Expenses
| Year ended 31 | ||
| December 2022 | ||
| Year ended 31 | ||
| December 2021 | ||
| £000 | £000 | |
| Legal and professional | (59) | (48) |
| Tax and audit | (35) | (44) |
| Remuneration Costs* | (351) | (315) |
| Other | (142) | (117) |
| Irrecoverable VAT on Administration expenses ** | (9) | (16) |
| Total administrative expenses | (596) | (540) |
*Within the tax and audit figure are £30,000 (2021: £30,000) accrued for auditors remuneration.
**During the year remuneration related solely to contractors (2021: contractors and 1 employee).
7 Employees
| Year ended 31 | ||
| December 2022 | ||
| Year ended 31 | ||
| December 2021 | ||
| Admin | 0 | 1 |
| 0 | 1 |
41
Notes to the Consolidated Financial Statements
continued
8 Net Financing (Loss)/Income
| Year ended 31 | ||
| December 2022 | ||
| Year ended 31 | ||
| December 2021 | ||
| £000 | £000 | |
| Interest receivable | - | - |
| Gain on foreign exchange | 127 | - |
| Realised Gain or (Loss) on Investment | 191 | - |
| Unrealised Gain or (Loss) on Investment | - | 23 |
| Financing income | 318 | 23 |
| Interest paid | (20) | (5) |
| Loss on foreign exchange | - | (44) |
| Unrealised Gain or (Loss) on Investment | (428) | - |
| Realised Gain or (Loss) on Investment | - | (3) |
| Finance lease depreciation | (3) | (3) |
| Head rents treated as finance leases (note 2) | (22) | (23) |
| Financing expenses | (473) | (78) |
| Net financing (loss)/income | (155) | (55) |
9 Taxation
| Year ended 31 | ||
| December 2022 | ||
| Year ended 31 | ||
| December 2021 | ||
| £000 | £000 | |
| Loss before tax | (136) (294) | |
| Corporation tax in the UK of 19% (2021: 19%) | (26) (56) | |
| Effects of: | ||
| Revaluation deficit and other non-deductible items | - | - |
| Deferred tax asset not recognised | 28 | 28 |
| Total tax | - | - |
Following the Company’s adoption of its new investment policy in September 2020, the Group is
considered by HM Customs & Revenue to have exited the REIT tax regime with effect from 1 October
2018 and, from that date, is fully subject to corporation tax.
However, the Board believes that the Group’s activities since then and the availability of tax losses
means that the Company’s activities are unlikely to have generated any material corporation tax liability
for periods since 1 October 2018. Accordingly, no provision for corporation tax has been made in these
accounts. The deferred tax asset not recognised relating to these losses can be carried forward
indefinitely. It is not anticipated that sufficient profits from the residual business will be generated in the
foreseeable future to utilise the losses carried forward and therefore no deferred tax asset has been
recognised in these accounts.
42
Notes to the Consolidated Financial Statements
continued
10 Earnings per share
The calculation of basic earnings per share was based on the profit attributable to ordinary shareholders
and a weighted average number of ordinary shares outstanding.
| Year ended 31 | ||
| December 2022 | ||
| Year ended 31 | ||
| December 2021 | ||
| £000 | £000 | |
| The calculation of earnings per share is based on the loss and | ||
| number of shares: | ||
| Loss for the period (£'000) | (136) | (294) |
| Weighted average number of shares of the Company ('000) | 22,697 | 22,697 |
| Earnings per share: | ||
| Basic and Diluted (GBP - pence) | (0.60) | (1.30) |
11 Investment Properties
| Freehold | Leasehold | |||
| Investment | ||||
| Investment | Investment | |||
| Properties | ||||
| Properties | Properties | |||
| Held for sale | ||||
| Total | ||||
| £000 | £000 | |||
| £000 | ||||
| £000 | ||||
| At 31 December 2020 | 40 | 2,722 | 330 | 3,092 |
| Fair value adjustment - head leases | - | 25 | - | 25 |
| Depreciation - head leases | - | (3) | - | (3) |
| At 31 December 2021 | 40 | 2,744 | 330 | 3,114 |
| Depreciation - head leases | - | (3) | - | (3) |
| Fair value adjustment - property | - | 563 | - | 563 |
| Reclassification of property for sale | - | (800) | 800 | - |
| Sale of property | (40) | - | (330) | (40) |
| At 31 December 2022 | - | 2,504 | 800 | 3,304 |
A reconciliation of the portfolio valuation at 31 December 2022 to the total value for investment
properties given in the Consolidated Balance Sheet is as follows:
| As at 31 | ||
| December 2022 | ||
| As at 31 | ||
| December 2021 | ||
| £000 | £000 | |
| Portfolio valuation | ||
| 2,968 | 2,775 | |
| Head leases treated as investment properties per IFRS 16 | 336 | 339 |
| Total property portfolio | 3,304 | 3,114 |
| Investment Properties held for sale | ||
| (800) | (330) | |
| Investment properties held for development | ||
| and ongoing rental | ||
| 2,504 | 2,784 |
The basis for determining fair value is described in note 2.4.
43
Notes to the Consolidated Financial Statements
continued
12 Available for sale financial assets
The Group classifies the following financial assets at fair value through profit or loss (FVPL):-
| Year ended 31 | ||
| December 2022 | ||
| Year ended 31 | ||
| December 2021 | ||
| £000 | £000 | |
| Available for sale investments | ||
| At the beginning of the period | 1,783 | - |
| Additions | 5,532 | 1,957 |
| Unrealised gain/(losses) | (211) | 23 |
| Disposals | (5,355) | (197) |
| At 31 December | 1,749 | 1,783 |
FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR
LOSS
| Year ended 31 | ||
| December 2022 | ||
| Year ended 31 | ||
| December 2021 | ||
| £000 | £000 | |
| Non-current assets | ||
| Available for sale financial assets | ||
| 1,749 | 1,783 | |
| Investments in associated entities | ||
| - | - | |
| Portfolio Holdings | ||
| 848 | 36 | |
| At 31 December | 2,597 | 1,819 |
*These assets are formed of equity instruments held on quoted markets globally, they comprise both long and short
positions as per the disclosures in the Strategic Report.
**These holdings comprise foreign currency balances held for short periods from the sale and purchase of financial
assets through the broker
AFS investments have been valued incorporating Level 1 inputs in accordance with IFRS7. They are a
combination of cash and securities held with the listed broker.
Financial instruments require classification of fair value as determined by reference to the source of
inputs used to derive the fair value. This classification uses the following three-level hierarchy:
• Level 1 — quoted prices (unadjusted) in active markets for identical assets or liabilities;
• Level 2 — inputs other than quoted prices included within level 1 that are observable for the asset or
liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices);
• Level 3 — inputs for the asset or liability that are not based on observable market data (unobservable
inputs).
44
Notes to the Consolidated Financial Statements
continued
13 Trade and Other Receivables
| Year ended 31 | ||
| December 2022 | ||
| Year ended 31 | ||
| December 2021 | ||
| £000 | £000 | |
| Trade receivables | 88 | 145 |
| Other receivables | 35 | 9 |
| Prepayments | 110 | 101 |
| Total trade and other receivables | 233 | 255 |
14 Cash and cash equivalents
| Year ended 31 | ||
| December 2022 | ||
| Year ended 31 | ||
| December 2021 | ||
| £000 | £000 | |
| Cash in the Statement of Cash Flows | 873 | 1,767 |
15 Trade and Other Payables
| Year ended 31 | ||
| December 2022 | ||
| Year ended 31 | ||
| December 2021 | ||
| £000 | £000 | |
| Trade payables | 144 | 25 |
| Other payables | 245 | 188 |
| Accruals and deferred income | 179 | 163 |
| Head lease liabilities | 23 | 23 |
| Total trade and other payables | 591 | 398 |
16 Lease liabilities
Lease liabilities on head rents are payable
as follows:
| Minimum | Net | ||
| Lease | Implicit | Present | |
| Payment | Interest | Value | |
| £000 | £000 | £000 | |
| At 31 December 2020 | 2,734 | (2,413) | 321 |
| Annual head lease payment increase | |||
| 317 | (292) | 25 | |
| Movement in value | |||
| (22) | 23 | 0 | |
| At 31 December 2021 | 3,029 | (2,682) | 346 |
| Movement in value | |||
| (23) | 22 | (0) | |
| At 31 December 2022 | 3,006 | (2,660) | 346 |
In the above table, the net present value of future lease payments has been determined using the
cost of capital at the time each of the head leases were acquired. All leases expire in more than five
years.
45
Notes to the Consolidated Financial Statements
continued
17 Financial Instruments and Risk Management
The Board of directors has overall responsibility for the establishment and oversight of the Group’s risk
management framework.
As described in the Corporate Governance report, this responsibility has been assigned to the executive
directors with support and feedback from the Audit Committee. The Audit Committee oversees how
management monitors compliance with the Group’s risk management policies and procedures and
reviews the adequacy of the risk management framework in relation to the risks faced by the Group.
The Group has identified exposure to the following financial risks from its use of financial instruments:
capital management risk, market risk, credit risk and liquidity risk.
Capital Management Risk
The Group’s capital consists of cash and equity attributable to the shareholders. T he Board do not
consider there is any material capital management risk exposure.
Market Risk
Market risk is the risk that changes in market conditions, such as interest rates, foreign exchange rates
and equity prices, will affect the Group’s profit or loss and cash flows.
Equity risk is mitigated using a combination of long and short positions to ensure that fluctuations in the
market are hedged against.
| As at | As at | |
| 31 Dec 22 | 31 Dec 21 | |
| £000 | £000 | |
| Market Risk on Available for Sale Investments | ||
| Increase by 1% | 17 | 18 |
| Decrease by 1% | (17) | (18) |
| Increase by 5% | 87 | 89 |
| Decrease by 5% | (87) | (89) |
Sensitivity Analysis
IFRS 7 requires an illustration of the impact on the Group’s financial performance of changes in interest
rates. The following sensitivity analysis has been prepared in accordance with the Group’s existing
accounting policies and considers the impact on the Income Statement and on equity of an increase of
100 basis points (1%) in interest rates. A ny consequential tax impact is excluded.
46
Notes to the Consolidated Financial Statements
continued
Actual results in the future may differ materially from these assumptions and, as such, these tables
should not be considered as a projection of likely future gains and losses.
| As at | As at | |
| 31 Dec 22 | 31 Dec 21 | |
| £000 | £000 | |
| Interest Rate Risk | ||
| Increase by 1% | 13 | 29 |
| Decrease by 1% | (13) | (29) |
| Increase by 5% | 66 | 146 |
| Decrease by 5% | (66) | (146) |
Fair value measurements recognised in the statement of financial position
Investment properties and Investment properties held for sale are measured subsequent to initial
recognition at fair value and have been group as Level 3 (2019: level 3) based on the degree to which
fair value is observable.
• Level 1 fair value measurements are those derived from quoted prices (unadjusted) in active
markets for identical assets and liabilities;
• Level 2 fair value measurements are those derived from inputs other than quoted prices included
within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly
(i.e. derived from prices); and
• Level 3 fair value measurements are those derived from valuation techniques that include inputs
for the asset or liability that are not based on observable market data (unobservable inputs).
Investment properties have been valued using the investment method which involves applying a yield
to rental income streams.
Inputs include equivalent yield, tenancy information, and leasing assumptions. Valuation reports are
based on both information provided by the Company e.g. tenancy information including current rents,
which are derived from the Company’s financial and property management systems and are subject to
the Company’s overall control environment, and assumptions applied by the valuers e.g. ERVs, and
yields. These assumptions are based on market observation and the valuers’ professional judgement.
An increase/decrease in equivalent yields will decrease/increase valuations, and an increase or
decrease in rental values will increase or decrease valuations. Other inputs include ERVs, and likely
void and rent-free periods. There are interrelationships between these inputs as they are determined
by market conditions. The valuation movement in a period depends on the balance of those inputs.
47
Notes to the Consolidated Financial Statements
continued
Below is a sensitivity analysis of the impact of a 1% increase or decrease in equivalent yields on income
and equity. Actual results may differ materially from these assumptions and, as such, these tables
should not be considered as a projection of likely future gains and losses.
| As at | As at | |
| 31 Dec 22 | 31 Dec 21 | |
| £000 | £000 | |
| Interest Rate Risk | ||
| Increase by 1% | 33 | 28 |
| Decrease by 1% | (33) | (28) |
Below is a sensitivity analysis of the impact of a 1% increase or decrease in foreign exchange rates on
income and equity. Actual results may differ materially from these assumptions and, as such, these
tables should not be considered as a projection of likely future gains and losses.
| As at | As at | |
| 31 Dec 22 | 31 Dec 21 | |
| £000 | £000 | |
| Foreign Exchange Risk | ||
| Increase by 1% | (0) | 23 |
| Decrease by 1% | (8) | (46) |
Credit Risk
Credit risk is the risk of financial loss to the Group if a tenant, bank or counterparty to a financial instrument
fails to meet its contractual obligations and arises principally from the Group’s receivables from tenants,
cash and cash equivalents held by the Group’s bankers and derivative financial instruments entered
into with the Group’s bankers.
Trade and Other Receivables
The Group’s exposure to credit risk is influenced mainly by the individual characteristics of each tenant.
At 31 December 2022 the Group had over 40 letting units in four properties. There is no significant
concentration of credit risk due to the large number of small balances owed by a wide range of tenants
who operate across all retail sectors. There is no concentration of credit risk in any one geographic area
of the UK. The level of arrears is monitored monthly by the Group on a tenant by tenant basis.
Cash, Cash Equivalents and Derivative Financial Instruments
The banking services used by the Group are split between a major UK bank and a Swiss private banking
corporation for deposit purposes.
Liquidity Risk
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due.
The Group’s approach to managing liquidity risk is to ensure, as far as possible, that it will always have
adequate resources to meet its liabilities when they fall due for both the operational needs of the
business and to meet planned future investments. This position is formally reviewed on a quarterly
basis or more frequently should events require it.
48
Notes to the Consolidated Financial Statements
continued
The Group’s financial liabilities are classified and are shown with their fair value as follows:
31 December 2022
| At Amortised | Total Carrying | At | |
| Cost | Amount | Fair Value | |
| - | - | - | |
| Finance lease liabilities | 346 | 346 | 346 |
| Trade payables | 144 | 144 | 144 |
| Other payables | 246 | 246 | 246 |
| Due to associated company | - | - | - |
| Accruals | 179 | 179 | 179 |
| 914 | 914 | 914 |
31 December 2021
| At Amortised | Total Carrying | At | |
| Cost | Amount | Fair Value | |
| £0 | £0 | £0 | |
| Finance lease liabilities | 346 | 346 | 346 |
| Trade payables | 25 | 25 | 25 |
| Other payables | 188 | 188 | 188 |
| Due to associated company | - | - | - |
| Accruals | 163 | 163 | 163 |
| 722 | 722 | 722 |
For all classes of financial liabilities, the carrying amount is a reasonable approximation of
fair value.
The maturity profiles of the Group’s financial liabilities are as follows:
31 December 2022
| Carrying | ||||||||
| Value | ||||||||
| Contractual | ||||||||
| Cash Flows | ||||||||
| Within | ||||||||
| One | ||||||||
| Year | ||||||||
| One to | ||||||||
| Two | ||||||||
| Years | ||||||||
| Two to | ||||||||
| Three | ||||||||
| Years | ||||||||
| Three | ||||||||
| to Four | ||||||||
| Years | ||||||||
| Four to | ||||||||
| Five | ||||||||
| Years | ||||||||
| Over | ||||||||
| Five | ||||||||
| Years | ||||||||
| £000 | £000 | £000 | £000 | £000 | £000 | £000 | £000 | |
| Finance lease | ||||||||
| liabilities | ||||||||
| 346 | 3,006 | 23 | 23 | 23 | 23 | 23 | 2,893 | |
| Trade payables | 144 | 144 | 144 | |||||
| Other payables | 246 | 246 | 246 | |||||
| Due to associated | ||||||||
| company | ||||||||
| - | - | - | ||||||
| Accruals | 179 | 179 | 179 | |||||
| 914 | 3,574 | 591 | 23 | 23 | 23 | 23 | 2,893 |
49
Notes to the Consolidated Financial Statements
continued
31 December 2021
| Carrying | ||||||||
| Value | ||||||||
| Contractual | ||||||||
| Cash Flows | ||||||||
| Within | ||||||||
| One | ||||||||
| Year | ||||||||
| One to | ||||||||
| Two | ||||||||
| Years | ||||||||
| Two to | ||||||||
| Three | ||||||||
| Years | ||||||||
| Three to | ||||||||
| Four | ||||||||
| Years | ||||||||
| Four to | ||||||||
| Five | ||||||||
| Years | ||||||||
| Over | ||||||||
| Five | ||||||||
| Years | ||||||||
| £000 | £000 | £000 | £000 | £000 | £000 | £000 | £000 | |
| Finance lease | ||||||||
| liabilities | ||||||||
| 346 | 3,073 | 23 | 23 | 23 | 23 | 23 | 2,960 | |
| Trade payables | 25 | 25 | 25 | |||||
| Other payables | 188 | 188 | 188 | |||||
| Due to | ||||||||
| associated | ||||||||
| company | ||||||||
| - | - | - | ||||||
| Accruals | 163 | 163 | 163 | |||||
| 722 | 3,448 | 398 | 23 | 23 | 23 | 23 | 2,960 |
Contractual cash flows include the undiscounted committed interest cash flows and, where the amount
payable is not fixed, the amount disclosed is determined by reference to the conditions existing at the
year end
18 Operating Lease as Lessor
| Year ended 31 | ||
| December 2022 | ||
| Year ended 31 | ||
| December 2021 | ||
| £000 | £000 | |
| Within one year | 273 | 309 |
| After one year but not more than five years | 759 | 762 |
| More than five years | 513 | 369 |
| 1,545 | 1,440 |
19 Capital Commitments
No capital expenditure was planned at the balance sheet date.
50
Notes to the Consolidated Financial Statements
continued
20 Related party balances and transactions
Transactions with Key Management Personnel
The only transactions with key management personnel relate to remuneration which is set out in the
Remuneration Report.
The key management personnel of the Group for the purposes of related party disclosures under IAS
24 comprise all executive and non-executive directors.
As at the year end the Group owed £17,073 (2021: £Nil) to Thalassa Holdings Limited (“Thalassa”), a
company under common directorship. During the year services amounting to £91,490 (2021: £123,619)
were charges from Thalassa.
The bulk of this sum related to administration fees settled by Thalassa but payable by the Group. The
remained related to accounting and registered office services supplied to the Group by Thalassa at
cost.
The company was invoiced £155,000 (2021: £215,000), to Fleur De Lys Ltd, a company owned and
controlled by the Chairman Duncan Soukup, for consultancy and administration services.
Athenium Consultancy Ltd, a company in which the Group owns shares invoiced the group for financial
and corporate administration services totaling £165,000 for the period (Dec 2021: nil).
21 Share capital
| As at | As at | |
| 31 Dec 21 | 31 Dec 20 | |
| £ | £ | |
| Allotted, issued and fully paid: | ||
| 22,697,000 ordinary shares of £0.01 each | ||
| 226,970 | 226,970 | |
| 9,164,017 treasury shares of £0.01 each | ||
| 91,640 | 91,640 | |
| Total Share Capital | ||
| 318,610 | 318,610 |
During the year to 30 September 2019, the Company underwent a Court approved restructure of capital and buy back of shares.
Under this action the issued 20p shares were converted to 1p; capital reserves were transferred to distributable reserves;
59,808,456 shares were repurchased, and a new Capital Redemption Reserve of £0.598m was established.
Investment in Own Shares
At the year-end, 9,164,017 shares were held in treasury (December 2021: 9,164,017).
51
Notes to the Consolidated Financial Statements
continued
22 Group Entities
All the below companies are incorporated in the United Kingdom: -
| Effective | |||
| Share holding | |||
| Name of subsidiary | Place of incorporation | 2022 | 2021 |
| NOS 4 Limited** | United Kingdom | 100% | 100% |
| NOS 5 Limited** | United Kingdom | 100% | 100% |
| NOS 6 Limited** | United Kingdom | 100% | 100% |
| NOS 7 Limited ** (Dissolved on 21 Sep 2021) | United Kingdom | 100% | 100% |
| Gilfin Property Holding Limited*** | United Kingdom | 100% | 100% |
| NOS Holdings Limited** | United Kingdom | 100% | 100% |
** Registered office: Eastleigh Court, Bishopstrow, Warminste
r
, Wiltshire BA12 9HW
***In liquidation - Registered office: 4 Atlantic Quay, 70 York Street, Glasgow, G2 8JX
Subsidiaries NOS 4 Ltd (Registered number: 05707123), NOS 5 Ltd (Registered number: 05707124)
and NOS 6 Ltd (Registered number: 06188983) are exempt from the requirements relating to the audit
of accounts under section 479A of the Companies Act 2006
23 Associated Entities
Athenium Consultancy Ltd in which the Group owns 30% shares was incorporated on 12 October
2021. Movement on interests in associates can be summarised as follows:
| 2022 | 2021 | |
| £000 | £000 | |
| Cost as at 1 January | ||
| - | - | |
| Additions | ||
| 5 | - | |
| 5 | - |
24 Contingent Liabilities
There are currently two potential repair obligations at two separate Company properties currently under
investigation, including the extent to which the relevant group company may be required to underwrite
such costs as may arise and the extent to which the tenants or former tenants of the properties are
liable to contribute to such costs under the terms of their tenancy agreements.
25 Subsequent events
• Sale of Oldham property classified as an asset held for resale at the year-end (see note 11);
• Commencement of legal action against The Italian Way, a tenant in Hastings, for breach of lease
covenants.
52
Notes to the Consolidated Financial Statements
continued
26 Controlling Party and copies of the Financial Statements
At 30 September 2019 the ultimate group in which the results were consolidated was Thalassa Holdings
Limited, which was also the controlling party of the Company.
In October 2020 The Local Shopping REIT plc resolved to change its name to Alina Holdings PLC and
shortly thereafter Thalassa Holdings Limited disposed of its controlling interest in Alina Holdings PLC.
Accordingly, as at 31 December 2022 the Company had no ultimate controlling party.
The consolidated financial statements of Alina Holdings PLC are available to the public and may be
obtained from the Company’s website:
www.alina-holdings.com.
53
Company Balance Sheet
As at 31 December 2022
31 December
2022
31 December
2021
Note £000 £000
Assets
Non-current assets
Investments C2 3,105 3,105
Investments in associated entities
5 -
Total non-current assets 3,110 3,105
Current assets
Trade and other receivables C3 2,639 5
Available for sale financial assets
- 1,819
Cash and cash equivalents
524 1,313
Total current assets 3,163 3,137
Liabilities
Current liabilities
Trade and other payables C4 199 112
Total current liabilities 199 112
Net current assets 2,964 3,025
Net assets 6,074 6,130
Shareholders’ Equity
Share capital C6 319 319
Capital redemption reserve C6 598 598
Retained earnings C6 5,157 5,213
Total shareholders' equity 6,074 6,130
The Company has taken advantage of Section 408 of the Companies Act 2006 and has not included
its own profit and loss account in these financial statements. The Company’s loss for the period was
£0.06m (31 December 2021: £0.35m).
These financial statements were approved by the Board of directors on 31 May 2023 and were signed
on its behalf by:
C D Soukup
Director
The registered number of the Company is 05304743.
54
Notes to the Financial Statements
C1. Accounting Policies
These financial statements were prepared in accordance with Financial Reporting Standard 102 The
Financial Reporting Standard applicable in the UK (“FRS 102”) as issued in March 2018. The
presentation currency of these financial statements is sterling. All amounts in the financial statements
have been rounded to the nearest £1,000.
The consolidated financial statements of Alina Holdings PLC are prepared in accordance with UK
Adopted Accounting Standards (IFRS) and are available to the public. In these financial statements,
the company is considered to be a qualifying entity (for the purposes of this FRS) and has applied the
exemptions available under FRS 102 in respect of the following disclosures:
•
Reconciliation of the number of shares outstanding from the beginning to end of the period;
•
Cash Flow Statement and related notes; and
•
Key Management Personnel compensation.
As the consolidated financial statements include the equivalent disclosures, the Company has also
taken the exemptions under FRS 102 available in respect of the following disclosures:
•
Certain disclosures required by FRS 102.26 Share Based Payments; and,
•
The disclosures required by FRS 102.11 Basic Financial Instruments and FRS 102.12 Other
Financial Instrument Issues in respect of financial instruments not falling within the fair value
accounting rules of Paragraph 36(4) of Schedule 1.
The Company proposes to continue to adopt the reduced disclosure framework of FRS 102 in its next
financial statements.
The accounting policies set out below have, unless otherwise stated, been applied consistently to all
periods presented in these financial statements.
There were no judgements made by the directors, in the application of these accounting policies that
have significant effect on the financial statements, with a significant risk of material adjustment in the
next year.
Measurement convention
The financial statements are prepared on the historical cost basis.
55
Notes to the Financial Statements continued
Classification of financial instruments issued by the Company
In accordance with FRS 102.22, financial instruments issued by the Company are treated as equity
only to the extent that they meet the following two conditions:
(a) they include no contractual obligations upon the company to deliver cash or other financial
assets or to exchange financial assets or financial liabilities with another party under
conditions that are potentially unfavourable to the company; and
(b) where the instrument will or may be settled in the company’s own equity instruments, it is
either a non-derivative that includes no obligation to deliver a variable number of the
company’s own equity instruments or is a derivative that will be settled by the company’s
exchanging a fixed amount of cash or other financial assets for a fixed number of its own
equity instruments.
To the extent that this definition is not met, the proceeds of issue are classified as a financial liability.
Where the instrument so classified takes the legal form of the company’s own shares, the amounts
presented in these financial statements for called up share capital and share premium account exclude
amounts in relation to those shares.
Basic financial instruments
Trade and other creditors are recognised initially at transaction price plus attributable transaction costs.
Subsequent to initial recognition, they are measured at amortised cost, less any impairment losses in
the case of trade debtors. If the arrangement constitutes a financing transaction, for example if payment
is deferred beyond normal business terms, then it is measured at the present value of future payments
discounted at a market rate of instrument for a similar debt instrument.
Investments in subsidiaries
These are separate financial statements of the company. Investments in subsidiaries are carried at
cost less impairment.
Judgements and Estimates
In testing for impairment, management assesses the recoverable amount of investments and inter-
company debtors by reference to the subsidiaries’ net assets and their ability to recover these assets.
Provisions
A provision is recognised in the balance sheet when the Company has a present legal or constructive
obligation as a result of a past event, that can be reliably measured and it is probable that an outflow
of economic benefits will be required to settle the obligation. Provisions are recognised at the best
estimate of the amount required to settle the obligation at the reporting date.
Where the Company enters into financial guarantee contracts to guarantee the indebtedness of other
companies within its group, the company treats the guarantee contract as a contingent liability until such
time as it becomes probable that the company will be required to make a payment under the guarantee.
Interest receivable and Interest payable
Interest payable and similar charges include interest payable, finance charges on shares classified as
liabilities and finance leases recognised in profit or loss using the effective interest method, unwinding
of the discount on provisions, and net foreign exchange losses that are recognised in the profit and
loss account.
56
Notes to the Financial Statements continued
Taxation
Tax on the profit or loss for the year comprises current and deferred tax. Tax is recognised in the profit
and loss account except to the extent that it relates to items recognised directly in equity or other
comprehensive income, in which case it is recognised directly in equity or other comprehensive income.
Current tax is the expected tax payable or receivable on the taxable income or loss for the year, using
tax rates enacted or substantively enacted at the balance sheet date, and any adjustment to tax
payable in respect of previous years.
Deferred tax is provided on timing differences which arise from the inclusion of income and expenses
in tax assessments in periods different from those in which they are recognised in the financial statements.
The following timing differences are not provided for: differences between accumulated depreciation and
tax allowances for the cost of a fixed asset if and when all conditions for retaining the tax allowances
have been met; and differences relating to investments in subsidiaries to the extent that it is not
probable that they will reverse in the foreseeable future and the reporting entity is able to control the
reversal of the timing difference. Deferred tax is not recognised on permanent differences arising
because certain types of income or expense are non-taxable or are disallowable for tax or because
certain tax charges or allowances are greater or smaller than the corresponding income or expense.
Deferred tax is measured at the tax rate that is expected to apply to the reversal of the related difference,
using tax rates enacted or substantively enacted at the balance sheet date. Deferred tax balances are not
discounted.
Unrelieved tax losses and other deferred tax assets are recognised only to the extent that is it probable
that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.
C2. Fixed Assets Investments
Shares in Group
Undertakings Total
£000 £000
Cost
At 31 December 2021
108,605 108,605
At 31 December 2022 108,605 108,605
Provisions
At 31 December 2021
105,500 105,500
At 31 December 2022 105,500 105,500
Net book value
At 31 December 2022 3,105 3,105
At 31 December 2021 3,105 3,105
An impairment review of the carrying value of the Company’s investments in its subsidiary
undertakings has been performed. In carrying out this review, the directors had due regard to the
nature of the property investments held, which is commensurate with the funding arrangements in
place. On the basis of this review which included a review of the underlying assets of the individual
subsidiaries the directors have not written down the value of investments in subsidiary undertakings.
This was concluded due to the underlying assets being undervalued as per the valuation exercise
undertaken within the Group.
57
Notes to the Financial Statements continued
The companies in which the Company’s interests at the period end were more than 20% are as follows:
Name of subsidiary Place of incorporation 2022 2021
NOS 4 Limited** United Kingdom 100% 100%
NOS 5 Limited** United Kingdom 100% 100%
NOS 6 Limited** United Kingdom 100% 100%
NOS 7 Limited ** (Dissolved on 21 Sep 2021) United Kingdom 100% 100%
Gilfin Property Holding Limited*** United Kingdom 100% 100%
NOS Holdings Limited** United Kingdom 100% 100%
** Registered office: Eastleigh Court, Bishopstrow, Warminster, Wiltshire BA12 9HW
***In liquidation - Registered office: 4 Atlantic Quay, 70 York Street, Glasgow, G2 8JX
C3. Trade and other receivables
31 December
2022
31 December
2021
£000 £000
Amounts owed by Group undertakings
2,551 -
Other debtors
15 3
Prepayments
73 2
2,639 5
Amounts owed by group undertakings are interest free and repayable on demand.
C4. Available for sale financial assets
Year ended 31
December 2022
Year ended 31
December 2021
£000 £000
Available for sale financial assets*
-
1,783
Investments in associated entities**
- -
Portfolio Holdings
-
36
- 1,819
*These assets are formed of equity instruments held on quoted markets globally, they comprise both long and short
positions as per the disclosures in the Strategic Report.
**These holdings comprise foreign currency balances held for short periods from the sale and purchase of financial
assets through the broker
AFS investments have been valued incorporating Level 1 inputs in accordance with IFRS7. They are
a combination of cash and securities held with the listed broker.
Financial instruments require classification of fair value as determined by reference to the source of
inputs used to derive the fair value. This classification uses the following three-level hierarchy:
• Level 1 — quoted prices (unadjusted) in active markets for identical assets or liabilities;
• Level 2 — inputs other than quoted prices included within level 1 that are observable for the asset
or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices);
• Level 3 — inputs for the asset or liability that are not based on observable market data
(unobservable inputs).
58
Notes to the Financial Statements continued
C5. Trade and other payables
31 December
2022
31 December
2021
£000 £000
Trade creditors
117 12
Amounts owed to Group undertakings
- 14
Amounts owed to related party
- -
Other creditors
- 4
Accruals
82 82
199 112
Amounts owed to group undertakings are interest free and repayable on demand.
C6. Reconciliation of Shareholders’ Funds
Share Capital
31 December 2022 31 December 2021
Number Amount Number Amount
000 £000 000 £000
Allotted, called up and fully paid
31,861
319
31,861 319
31,861 319 31,861 319
Investment in Own Shares
At the year-end, 9,164,017 shares were held in treasury (2021: 9,164,017), and at the date of this report
9,164,017 were held in treasury.
Statement of Changes in Equity for the 12 months ended 31 December 2022
Capital
Share
Redemption Retained
Capital Reserves Reserves Earnings Total
£000 £000 £000 £000 £000
Balance as at 31 December 2020 319 - 598 5,563 6,480
Total comprehensive income for the year - -
(350) (350)
Balance as at 31 December 2021 319 - 598 5,213 6,130
Total comprehensive income for the year - - - (56) (56)
Balance as at 31 December 2022 319 - 598 5,158 6,074
C7. Controlling Party
Please refer to note 26 in the Group Financial Statements
59
Glossary
Earnings Per Share (“EPS”)
EPS is calculated as profit attributable to shareholders divided by the weighted average number
of shares in issue in the year.
Equivalent Yield
Equivalent yield is a weighted average of the initial yield and reversionary yield and represents the return
a property will produce based upon the timing of the income received. In accordance with usual
practice, the equivalent yields (as determined by the Group’s external valuers) assume rent received
annually in arrears and on gross values including prospective purchasers’ costs (including stamp duty,
and agents’ and legal fees).
Head Lease
A head lease is a lease under which the Group holds an investment property.
Initial Yield
Initial yield is the annualised net rent generated by a property expressed as a percentage of the property
valuation. In accordance with usual practice the property value is grossed up to include prospective
purchasers’ costs.
Like-for-like Market Rent
This is the Market Rent for the Group’s investment properties at the end of the financial year compared
with the Market Rent for the same properties at the end of the prior year, i.e. excluding the Market Rent
of those properties disposed of during the interim period.
Like-for-like rental income
This is the rental income for the Group’s investment properties at the end of the financial year compared
with the rental income for the same properties at the end of the prior year, i.e. excluding rental income
of those properties disposed of during the interim period.
Market Value
Market value is the estimated amount for which a property should exchange on the date of valuation
between a willing buyer and willing seller in an arm’s length transaction after proper marketing wherein
the parties had each acted knowledgeably, prudently and
without compulsion.
Market Rent
Market rent is the estimated amount for which a property should lease on the date of valuation between
a willing lessor and a willing lessee on appropriate lease terms, in an arm’s length transaction, after
proper marketing wherein the parties had each acted knowledgeably, prudently and without
compulsion.
Net Asset Value (“NAV”) per share
NAV per share is calculated as shareholders’ funds divided by the number of shares in
issue at the year-end excluding treasury shares.
Real Estate Investment Trust (“REIT”)
A REIT is a listed property company which qualifies for and has elected to join the UK REIT tax regime,
which exempts qualifying UK property rental income and gains on investment property disposals from
corporation tax. The Group converted to REIT status on 11 May 2007 and left the REIT tax regime on 1
October 2018
Reversionary Yield
Reversionary yield is the annualised net rent that would be generated by a property if it were fully let
at market rent expressed as a percentage of the property valuation. In accordance with usual practice
the property value is grossed up to include prospective purchasers’ costs.
60
