FOR THE YEAR ENDED 30 JUNE 2020
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92 HIGHER DRIVE LIMITED
COMPANY INFORMATION
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92 HIGHER DRIVE LIMITED
CONTENTS
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92 HIGHER DRIVE LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 30 JUNE 2020
Year on year turnover within the company grew from £6.96m to £7.08m. Profit before tax, was £200k compared to £706k in 2019.
The directors consider that annual fluctuations in financial performance are primarily linked to the impact of COVID-19 on admissions and operational costs as well as factors such as the impact of resident mix on the level of required care for residents. Despite the impact of COVID-19, the care home continued to operate at a high level of occupancy throughout the year maximising utilisation of the available bed space. The directors expect the impact of COVID-19 and the uncertainty surrounding Brexit to have an impact on its base costs but feel that that the company is well placed to see it through these short-term fluctuations.
The management of the business and the execution of the company’s strategy are subject to a number of risks.
The company manages its cash, borrowing requirements and interest rate risk through variable rate loan finance in the overall group. In common with other businesses operating in the sector, the company’s future prospects are reliant on maintaining strong collaborative links with the local Clinical Commissioning Groups (CCGs) from whom residents are primarily referred. The directors have worked to establish productive and proactive dialogues to ensure that these relationships are maintained. Maintaining the highest standards of residential care is dependent on the ability to recruit and retain a highly qualified and motivated workforce. The directors are confident that they have the right team in place to ensure that the company is viewed as a desirable employer in a competitive labour market. The directors implemented a large overseas recruitment campaign which has resulted in a significant number of nurses joining the company, further strengthening our workforce. The effect of COVID-19 continues to impact on operational costs, especially PPE, which saw a quadrupling in costs. This has been further exacerbated by the need to keep clinically required stock at a higher-than-normal level due to the ongoing impact of COVID-19 and Brexit on supplies. However, the directors have developed robust stock management strategies to help minimise these impacts. The directors envisage supply chains stabilising and the NHS PPE Portal becoming better established over the course of the pandemic which will further mitigate the impact.
The directors consider that turnover, net profit and cash generated from operations are the financial key performance indicators of the business.
The key non-financial performance indicator is occupancy rates in the available 45 beds space – this was at 82% for the year (93% in the previous year). Although below optimal, the directors attribute this to the home temporarily closing to new admissions due to the impact of COVID-19. The home has since re-opened to new admissions and the occupancy level has now increased to similar levels to that seen in the prior year.
We continue to seek new opportunities for further growth as well as focusing on maintaining the highest levels of residential care at Highfield House.
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92 HIGHER DRIVE LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2020
This report was approved by the board on 15 September 2021
and signed on its behalf.
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92 HIGHER DRIVE LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2020
The directors present their report and the financial statements for the year ended 30 June 2020.
The profit for the year, after taxation, amounted to £
177,533
(2019:
£
598,030
)
.
The directors who served during the year were:
The group places considerable value on the involvement of its employees and has continued to keep them informed on matters affecting them as employees and on the various factors affecting the performance of the group. This is achieved through formal and informal meetings. Employee representatives are consulted regularly on a wide range of matters affecting their current and future interests.
The Companies Act 2006 (Strategic Report and Directors' Report) Regulations 2013 requires a Strategic Report to be prepared. Where mandatory disclosures in the Directors' Report are considered by the directors to be of strategic importance, these may alternatively be contained in the Strategic Report, provided that the Directors' Report contains a statement disclosing which information has been placed there.
The auditors, Bishop Fleming Bath Limited, will be proposed for reappointment in accordance with
section 485 of the Companies Act 2006.
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92 HIGHER DRIVE LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2020
This report was approved by the board and signed on its behalf.
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92 HIGHER DRIVE LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 30 JUNE 2020
The directors are responsible for preparing the Strategic report, the Directors' report and the
financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year
. Under that law the directors have elected to prepare the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period.
In preparing these financial statements, the directors are required to:
∙
select suitable accounting policies for the company's financial statements and then apply them consistently;
∙
make judgements and accounting estimates that are reasonable and prudent;
∙
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and to enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
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92 HIGHER DRIVE LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS, AS A BODY, OF
92 HIGHER DRIVE LIMITED
We have audited the financial statements of 92 Higher Drive Limited (the 'company') for the year ended 30 June 2020, which comprise the Statement of income and retained earnings, the Statement of financial position
and the related notes, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards,
including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).
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 Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council's Ethical Standard and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report to you where:
∙
the directors
' use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or
∙
the directors have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the company's ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the financial statements are authorised for issue.
The 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 Auditors' 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.
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92 HIGHER DRIVE LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS, AS A BODY, OF
92 HIGHER DRIVE LIMITED (CONTINUED)
In our opinion, based on the work undertaken in the course of the audit:
∙
the information given in the Strategic report and the Directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
∙
the Strategic report and the Directors' report have been prepared in accordance with applicable legal requirements.
In the light of the knowledge and understanding of the 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.
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an Auditors' report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at:
www.frc.org.uk/auditorsresponsibilities
. This description forms part of our Auditors' report.
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92 HIGHER DRIVE LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS, AS A BODY, OF
92 HIGHER DRIVE LIMITED (CONTINUED)
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 Auditors' 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.
for and on behalf of
Chartered Accountants
Statutory Auditors
Minerva House
Lower Bristol Road
BA2 9ER
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92 HIGHER DRIVE LIMITED
STATEMENT OF INCOME AND RETAINED EARNINGS
FOR THE YEAR ENDED 30 JUNE 2020
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92 HIGHER DRIVE LIMITED
REGISTERED NUMBER:
01906108
STATEMENT OF FINANCIAL POSITION
AS AT
30 JUNE 2020
The financial statements were approved and authorised for issue by the board and were signed on its behalf by
:
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92 HIGHER DRIVE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2020
92 Higher Drive Limited is a limited liability company incorporated in England. The registered office is 2-6 Uffington Road, West Norwood, London, SE27 0RW.
2.
ACCOUNTING POLICIES
The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Section 1A of
Financial Reporting Standard 102, the Financial Reporting Standard applicable in
the UK and the Republic of Ireland and the Companies Act 2006
.
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgement in applying the company's accounting policies (see note 3).
The following principal accounting policies have been applied:
The company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by the FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":
∙
the requirements of Section 11 Financial Instruments paragraphs 11.42, 11.44 to 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b) and 11.48(c);
∙
the requirements of Section 12 Other Financial Instruments paragraphs 12.26 to 12.27, 12.29(a), 12.29(b) and 12.29A;
∙
the requirements of Section 33 Related Party Disclosures paragraph 33.7.
This information is included in the consolidated financial statements of Fairlie Holdings Limited as at 30 June 2020 and these financial statements may be obtained from Companies House.
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92 HIGHER DRIVE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2020
2.
ACCOUNTING POLICIES (continued)
The revenue streams for the company are provided by Clinical Commissioning Groups (CCGs) and Social Services and so have remained relatively strong and are forecast to continue to do so for the foreseeable future. Following on from the Covid 19 outbreak, the company has introduced various measures to ensure the safety of its patients and therefore its revenue streams.
The Company is a part of the Fairlie Holdings Limited group (“the Group”) and the Group has two distinct and separate funding groups, one of which has borrowings from Barclays (“the Barclays borrowing group”) and the other which has borrowings from Triodos (“the Triodos borrowing group”). The Company is a member of the Triodos borrowing group, and as disclosed in Note 15, cross guarantees exist amongst the members of the Triodos borrowing group. The response to Covid 19 as noted above and in the director's report ensures that the group has the ability to continue trading profitably and in a cash generative manner. The directors have prepared forecasts which allow for the additional costs of operation caused by COVID-19 and also considered the impact of any outbreaks of COVID-19 within the homes that the wider group operates. The directors have also updated forecasts to reflect delays caused to the development of the group’s new properties. The directors have also updated forecasts to reflect delays caused to the development of the group’s new properties. The directors forecast that there will be a covenant breach at 30 June 2021. No formal waiver of enforcement action as a result of this breach has been obtained by the directors but the directors are in discussions with Triodos regarding this breach and are seeking confirmation that existing facilities will continue to be made available from Triodos. Whilst continuing in a positive way, and the outcome of these discussions is expected to be positive, the conclusion remains uncertain. Notwithstanding the forecast covenant breach, on the basis of these forecasts, the directors are satisfied that the Company and other companies in the Triodos borrowing group has sufficient resources to meet its debt finance service and working capital requirements. Certain companies within the Triodos borrowing group have also received funding from companies within the Barclays borrowing group. Companies within the Triodos borrowing group are dependent upon the construed availability of these advances, which is in turn dependent upon the companies within the Barclays borrowing group continuing as going concerns. The directors expect this to be the case. The directors therefore consider that it is appropriate to prepare the accounts on a going concern basis. |
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92 HIGHER DRIVE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2020
2.
ACCOUNTING POLICIES (continued)
At each reporting date the company assesses whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined which is the higher of its fair value less costs to sell and its value in use. An impairment loss is recognised where the carrying amount exceeds the recoverable amount.
The company adds to the carrying amount of an item of fixed assets the cost of replacing part of such an item when that cost is incurred, if the replacement part is expected to provide incremental future benefits to the company. The carrying amount of the replaced part is derecognised. Repairs and maintenance are charged to profit or loss during the period in which they are incurred.
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.
Depreciation is provided on the following basis:
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.
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92 HIGHER DRIVE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2020
2.
ACCOUNTING POLICIES (continued)
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92 HIGHER DRIVE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2020
2.
ACCOUNTING POLICIES (continued)
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92 HIGHER DRIVE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2020
There were no significant judgments or estimates applied in the preparation of the financial statements.
The whole of the turnover is attributable to the company's principal activity.
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92 HIGHER DRIVE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2020
There were no factors that may affect future tax charges.
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92 HIGHER DRIVE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2020
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92 HIGHER DRIVE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2020
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92 HIGHER DRIVE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2020
13.
DEFERRED TAXATION (CONTINUED)
A bad debt of £115,355 that should be been expensed in the year to 30 June 2019 has been adjusted in the comparative figures. The effect of this adjustment is a reduction in reported profit of £115,355 and a reduction in trade debtors of £115,355.
The company is subject to a fixed charge over its assets in favour of Triodos Bank plc with Higher Drive Nursing Home (Holdings) Limited, Abercorn Property Limited, Woodstown House Property Limited and by a cross guarantee with Woodstown Healthcare Limited and Abercorn House Healthcare Limited fellow group companies, on loans totalling £13,475,470 (2019: £10,917,733).
The company operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the company in an independently administered fund. The pension cost charge represents contributions payable by the company to the fund and amounted to £123,211 (2019: £83,462). Contributions totalling £23,557 (2019: £17,285) were payable to the fund at the reporting date.
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92 HIGHER DRIVE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2020
The immediate parent undertaking is
The ultimate controlling party is |