Notes to the financial statements

 

1    General information

Everyman Media Group PLC and its subsidiaries (together, the Group) are engaged in the ownership and management of cinemas in the United Kingdom. Everyman Media Group PLC (the Company) is a public company limited by shares registered, domiciled and incorporated in England and Wales, in the United Kingdom (registered number 08684079). The address of its registered office is Studio 4, 2 Downshire Hill, London NW3 1NR. All trade takes place in the United Kingdom.       

 

2   Basis of preparation and accounting policies

This final results announcement for the year ended 29 December 2022 has been prepared in accordance with the UK adopted International Accounting Standards. The accounting policies applied are consistent with those set out in the Everyman Media Group plc Annual Report and Accounts for the year ended 29 December 2022.

The financial information contained within this final results announcement for the year ended 29 December 2022 and the year ended 30 December 2021 is derived from but does not comprise statutory financial statements within the meaning of section 434 of the Companies Act 2006. Statutory accounts for the year ended 30 December 2021 have been filed with the Registrar of Companies and those for the year ended 29 December 2022 will be filed following the Company's annual general meeting. The auditors' report on the statutory accounts for the year ended 29 December 2022 is unqualified, does not draw attention to any matters by way of emphasis and does not contain any statement under section 498 of the Companies Act 2006.

Going concern

Current trading is in line with management expectations. Given the increased number of wide releases year-on-year, commitment to the theatrical window from distributors and new investment from streamers in content for cinema, management expect admissions to continue to recover towards pre-pandemic levels. Paid for Average Ticket Price and Spend per Head have continued to grow steadily despite well-publicised concerns over consumer spends.

Banking

The Group's banking arrangements consist of a £25m Revolving Credit Facility ("RCF") and a £15m Coronavirus Large Business Interruption Loan Scheme ("CLBILS"). On the 14^th March 2023 the RCF was extended by 3 months, to 17^th April 2024. The CLBILS, which cannot be extended, will mature on the previous maturity date of 17^th January 2024. The Group's forecasts demonstrate headroom without the CLBILS component of the facility.

The Group is actively engaged with its banking partners on a re-finance of both the RCF and the CLBILS and expects to complete this process in the coming months.

At the end of the year, the Group had drawn down £22.2m on its facilities and held £3.7m in cash; the undrawn facility was therefore £18m and net banking debt £18.5m.

The facility covenants were amended temporarily to provide liquidity through the pandemic, when the facility amendments were made in the first quarter of 2021. From June 2022, the covenants returned to the pre-pandemic tests based on leverage and fixed cover charge. The Group has operated within these covenants all year and expects to continue to do so going forward.

Sale of Crystal Palace Freehold

 

On 16 January 2023, the Group completed the sale and leaseback of its freehold property at 25 Church Road, London SE19 2TE. Proceeds from the sale, after associated fees and disbursements, were £3.8m. At the balance sheet date, the property was held for sale in ECPee Limited, with a carrying value of £3.2m.

 

This additional liquidity has reduced the Group's reliance on debt to finance its expansion programme during 2023.

 

Salisbury Freehold

 

During the year the Group acquired the freehold at Gala Clubs, Endless Street, Salisbury SP1 1DP, which will open as a new four-screen cinema during 2023. The Group's forecasts do not consider the sale of this freehold and subsequent leaseback within the next 12 months. However, should the need for additional liquidity arise, management are of the view that this could be brought forward, as required.

 

Base case Scenario

 

The period forecast is up to 30 June 2024.

 

The business has now traded for in excess of 18 months without Government-enforced closures due to the pandemic, and the Board approved budget and latest forecasts assume that this will continue indefinitely. The forecast assumes growth in like-for-like admissions vs. 2022, given the fuller film release schedule as the industry recovers from pandemic-related production delays, but remain below pre-pandemic levels. Increases in forecast costs reflect the current inflationary environment. New openings are forecast at 6 for 2023, with corresponding capital investment.

In this scenario the Group maintains significant headroom in its banking facilities and complies with covenants.

Stress testing

 

The Board considers budget assumptions on admissions to be very conservative, given that they do not demonstrate a return to pre-pandemic levels until 2025. A reduction in budgeted admissions of 8% each month from March 2023 has been modelled. This scenario would cause a breach in the Fixed Cover Charge covenant in May 2023.

If such a scenario were to occur, Management would be able to temporarily reduce administrative expenditure to increase EBITDA and avoid a breach, without material impact to the Group's operations and the quality of customer experience. In this scenario, the Group would remain compliant with the Adjusted Leverage covenant.

 

The Directors believe that the Group is well-placed to manage its financing and other business risks satisfactorily and have a reasonable expectation that the Group will have adequate resources to continue in operation for at least 12 months from the approval of the financial statements. The Board considers that an 8% reduction in budgeted admissions is unlikely, particularly in light of business performance in January and February 2023 and the increase in the number of wide releases expected over the remainder of the year. As a result, the Board does not believe this to represent a material uncertainty, and therefore consider it appropriate to adopt the going concern basis of accounting in preparing the financial statements.

 

Use of non-GAAP profit and loss measures

The Group believes that along with operating profit, adjusted EBITDA provides additional guidance to the statutory measures of the performance of the business during the financial year. The reconciliation between operating profit and adjusted EBITDA is shown after the consolidated statement of profit and loss and other comprehensive income.

 

Adjusted EBITDA is calculated by adding back depreciation, amortisation, profit or loss on disposal of Property, Plant & Equipment, pre-opening expenses and certain non-recurring or non-cash items. Adjusted EBITDA is an internal measure used by management as they believe it better reflects the underlying performance of the Group beyond generally accepted accounting principles.

 

Exceptional items that have been added back when calculating adjusted EBITDA relate to restructuring costs within the Head Office team.

 

Basis of consolidation                                                                                                        

Where the Group has power, either directly or indirectly so as to have the ability to affect the amount of the investor returns and has exposure or rights to variable returns from its involvement with the investee, it is classified as a subsidiary. The balance sheet at 29 December 2022 incorporates the results of all subsidiaries of the Group for all years and periods, as set out in the basis of preparation.

 

Intra-Group balances and transactions, and any unrealised income and expenses arising from intra-Group transactions, are eliminated. Unrealised losses are eliminated in the same way as unrealised gains, but only to the extent that there is no evidence of impairment.

 

The consolidated financial statements include the results of the Company and all its subsidiary undertakings made up to the same accounting date.

 

Merger reserve                                                                                                    

On 29 October 2013 the Company became the new holding company for the Group. This was put into effect through a share-for-share exchange of 1 Ordinary share of 10 pence in Everyman Media Group PLC for 1 Ordinary share of 10 pence in Everyman Media Holdings Limited (previously, Everyman Media Group Limited), the previous holding company for the Group. The value of 1 share in the Company was equivalent to the value of 1 share in Everyman Media Holdings Limited.

 

The accounting treatment for group reorganisations is presented under the scope of IFRS3. The introduction of the new holding company was accounted for as a capital reorganisation using the principles of reverse acquisition accounting under IFRS3. Therefore, the consolidated financial statements are presented as if Everyman Media Group PLC has always been the holding company for the Group. The Company was incorporated on 10 September 2013.

 

The use of merger accounting principles has resulted in a balance in Group capital and reserves which has been classified as a merger reserve and included in the Group's shareholders' funds.         

 

The Company recognised the value of its investment in Everyman Media Holdings Limited at fair value based on the initial share placing price on admission to AIM. As permitted by s612 of the Companies Act 2006, the amount attributable to share premium was transferred to the merger reserve.

 

Revenue recognition          

Revenue for the Group is measured at the fair value of the consideration received or receivable. The Group recognises revenue for services provided when the amount of revenue can be reliably measured and it is probable that future economic benefits will flow to the entity.

 

Most of the Group's revenue is derived from the sale of tickets for film admissions and the sale of food and beverage, and therefore the amount of revenue earned is determined by reference to the prices of those items. The Group's revenues from film and entertainment activities are recognised on completion of the showing of the relevant film. The Group's revenues for food and beverages are recognised at the point of sale as this is the time the performance obligations have been met.

 

Bookings, gift cards and similar income which are received in advance of the related performance are classified as deferred revenue and shown as a liability until completion of the performance obligation.

 

All contractual-based revenue from memberships is initially classified as deferred revenue and subsequently recognised on a straight-line basis over the year. Advertising revenue is recognised at the point the advertisement is shown in the cinemas.

 

Fees charged for advanced bookings of tickets is recognised at the point when the tickets are purchased.  

 

Goodwill

Goodwill is stated at cost less any accumulated impairment losses. Goodwill is allocated to cash-generating units and is not amortised but is tested annually for impairment. Goodwill represents the excess of the costs of a business combination over the total acquisition date fair values of the identifiable assets, liabilities and contingent liabilities acquired. Goodwill is capitalised as an intangible asset. Costs incurred in a business combination are expensed as incurred with the exception that for business combinations completed prior to 1 January 2010, cost comprised the fair value of assets given, liabilities assumed and equity instruments issued, plus any direct costs of acquisition.

 

The recoverable amount of an asset or cash-generating unit (CGU) is the greater of its value-in-use and its fair value less costs to sell. In assessing value-in-use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. For the purpose of impairment testing, assets that cannot be tested individually are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or groups of assets (the CGU), this is usually an individual cinema venue. The goodwill acquired in a business combination, for the purpose of impairment testing, is allocated to CGUs. Subject to an operating segment ceiling test, for the purposes of goodwill impairment testing, CGUs to which goodwill has been allocated are aggregated so that the level at which impairment is tested reflects the lowest level at which goodwill is monitored for internal reporting purposes. Goodwill acquired in a business combination is allocated to groups of CGUs that are expected to benefit from the synergies of the combination.

 

An impairment loss is recognised if the carrying amount of an asset or its CGU exceeds its estimated recoverable amount. Impairment losses are recognised in the profit and loss. Impairment losses recognised in respect of CGUs are allocated first to reduce the carrying amount of any goodwill allocated to the units, and then to reduce the carrying amounts of the other assets in the unit/group of units on a pro-rata basis. Once goodwill has been impaired, the impairment cannot be reversed in future periods.

 

Intangible assets

Software and website assets acquired by the Group are stated at cost less accumulated amortisation and impairment losses. Amortisation is provided on all software assets so as to write off their carrying value over the expected useful economic lives. The estimated useful lives are as follows:     

 

Software assets                    - 3 to 5 years

 

Amortisation on software in development does not commence until it is complete and available for use.

 

Property, plant and equipment

Items of property, plant and equipment are recognised at cost less accumulated depreciation and accumulated impairment losses. As well as the purchase price, cost includes directly attributable costs.

 

Depreciation on assets under construction does not commence until they are complete and available for use. These assets represent fit-outs. Depreciation is provided on all other leasehold improvements and all other items of property, plant and equipment so as to write off their carrying value over the expected useful economic lives. The estimated useful lives are as follows:       

 

Freehold properties                            - 50 years                                                                             

Leasehold improvements   - straight line on cost over the remaining life of the lease

Plant and machinery                           - 5 years                                                                

Fixtures and fittings                             - 8 years

 

Depreciation methods, useful lives and residual values are reviewed at each balance sheet date. Land is not depreciated.      

 

Impairment (excluding inventories)

Impairment tests on goodwill and other intangible assets with indefinite useful economic lives are undertaken annually at the financial year end. Other non-financial assets are subject to impairment tests whenever events or changes in circumstances indicate that their carrying amount may not be recoverable. Where the carrying value of an asset exceeds its recoverable amount (i.e. the higher of value in use and fair value less costs to sell), the asset is written down accordingly.

 

Where it is not possible to estimate the recoverable amount of an individual asset, the impairment test is carried out on the smallest group of assets to which it belongs for which there are separately identifiable cash flows; its cash generating units ('CGUs'). Goodwill is allocated on initial recognition to each of the Group's CGUs that are expected to benefit from a business combination that gives rise to the goodwill.

 

Impairment losses (including reversals of impairment losses or impairment gains)  are included in profit or loss, except to the extent they reverse gains previously recognised in other comprehensive income. An impairment loss recognised for goodwill is not reversed.

 

Non-current assets held for sale

Non-current assets are classified as held for sale when:

 

- They are available for immediate sale

- Management is committed to a plan to sell

- It is unlikely that significant changes to the plan will be made or that the plan will be withdrawn

- An active programme to locate a buyer has been initiated

- The asset or disposal group is being marketed at a reasonable price in relation to its fair value, and

- A sale is expected to complete within 12 months from the date of classification.

 

Non-current assets classified as held for sale are measured at the lower of:

 

- Their carrying amount immediately prior to being classified as held for sale in accordance with the group's accounting policy; and

- Fair value less costs of disposal.

 

Following their classification as held for sale, non-current assets are not depreciated.

 

Inventories

Inventories are valued at the lower of cost and net realisable value. The cost incurred in bringing each product to its present location and condition is accounted for as follows:

 

Food and beverages            - purchase cost on a first-in, first-out basis

Projection stock                   - purchase cost on a first-in, first-out basis

 

Net realisable value is the estimated selling price in the ordinary course of business.

 

Provisions

A provision is recognised in the balance sheet when the Group 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. Lease dilapidation provisions are recognised when entering into a lease where an obligation is created. This obligation may be to return the leasehold property to its original state at the end of the lease in accordance with the lease terms. Leasehold dilapidations are recognised at the net present value and discounted over the remaining lease period.

 

Leases

At inception of a contract, the Group assesses whether a contract is, or contains, a lease. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. To assess whether a contract conveys the right to control the use an identified asset, the Group assesses whether:

 

·      the contract involves the use of an identified asset (this may be specified explicitly or implicitly, and should be physically distinct or represent substantially all of the capacity of a physically distinct asset). If the supplier has a substantive substitution right, then the asset is not identified;

·      the Group has the right to obtain substantially all of the economic benefits from use of the asset throughout the period of use; and

·      the Group has the right to direct the use of the asset. The Group has this right when it has the decision-making rights that are most relevant to changing how and for what purpose the asset is used.

 

At inception or on reassessment of a contract that contains a lease component, the Group allocates the consideration in the contract to each lease component on the basis of their relative stand-alone prices.

 

Leases in which the Group is a lessee

The Group recognises a right-of-use asset and a lease liability at the lease commencement date. The right-of-use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus any initial direct costs incurred and an estimate of costs to dismantle and remove the underlying asset or to restore the underlying asset or the site on which it is located, less any lease incentives received.

 

The right-of-use asset is subsequently depreciated using the straight-line method from the commencement date to the end of the lease term. The right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability.

 

The lease liability is initially measured at the present value of the lease payments at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the lessee's incremental borrowing rate.

 

Lease payments included in the measurement of the lease liability comprise the following:

·      fixed payments

·      variable lease payments that depend on an index or a rate, initially measured using the index or rate as at the commencement date

·      amounts expected to be payable under a residual value guarantee

 

The lease liability is measured at amortised cost using the effective interest method. It is remeasured when there is a change in future lease payments arising from a change in an index or rate, if there is a change in the Group's estimate of the amount expected to be payable under a residual value guarantee, or if the Group changes its assessment of whether it will exercise a purchase, extension or termination option.

 

When the lease liability is remeasured, a corresponding adjustment is made to the carrying amount of the right-of-use asset, or is recorded in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero.

 

Short-term leases and leases of low-value assets

The Group has elected not to recognise right-of-use assets and lease liabilities for short-term leases that have a lease term of 12 months or less and leases of low-value assets. The Group recognises these lease payments as an expense on a straight-line basis over the lease term.

 

IFRS 16: Leases - Covid-19 Related Rent concessions amendment

The Group has adopted the amendment to IFRS 16 that provides an optional practical expedient for lessees from assessing whether a rent concession related to Covid-19 is a lease modification. Where the rent concession is a direct consequence of the Covid-19 pandemic, the revised consideration for the lease is substantially the same or less, the reduction affects only payments originally due on or before 30 June 2021, this was subsequently extended to 30 June 2022, and there were no other substantive changes to the lease then the concessions can be credited to the profit and loss in the period in which the event or condition that triggers the rent concession occurs, rather than as a lease modification.

 

Taxation

Tax on the profit and loss for the year comprises current and deferred tax. Tax is recognised in the profit and loss 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 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 assets and liabilities are recognised where the carrying amount of an asset or liability in the consolidated balance sheet differs from its tax base, except for differences arising on:

 

·      The initial recognition of goodwill.

·      The initial recognition of an asset or liability in a transaction which is not a business combination and at the time of the transaction affects neither accounting nor taxable profit.

·      Investments in subsidiaries and jointly controlled entities where the Group is able to control the timing of the reversal of the difference and it is probable that the difference will not reverse in the foreseeable future.

 

Recognition of deferred tax assets is restricted to those instances where it is probable that taxable profit will be available against which the difference can be utilised.

 

The amount of the asset or liability is determined using tax rates that have been enacted or substantively enacted by the reporting date and are expected to apply when the deferred tax liabilities or assets are settled or recovered. Deferred tax balances are not discounted.

 

Deferred tax assets and liabilities are offset when the Group has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority on either:

·      The same taxable Group company; or

·      Different company entities which intend either to settle current tax assets and liabilities on a net basis or to realise the assets and settle the liabilities simultaneously, in each future period in which significant amounts of deferred tax assets and liabilities are expected to be settled or recovered.            

 

Operating segments

The Board, the chief operating decision maker, considers that the Group's primary activity constitutes one reporting segment, as defined under IFRS8.

 

The total profit measures are operating profit and profit for the year, both disclosed on the face of the consolidated profit and loss. No differences exist between the basis of preparation of the performance measures used by management and the figures used in the Group financial information.

 

 

All of the revenues generated relate to cinema tickets, sale of food and beverages and ancillary income, an analysis of which appears in the notes below. All revenues are wholly generated within the UK. Accordingly, there are no additional disclosures provided to the financial information.

 

Pre-opening expenses        

Overhead expenses incurred prior to a new site opening are expensed to the profit and loss in the year that they are incurred. Similarly, the costs of training new staff during the pre-opening phase are expensed as incurred. These expenses are included within administrative expenses, right-of-use depreciation and financing expenses.

 

Employee benefits                                                                                                               

Defined contribution plans

A defined contribution plan is a post-employment benefit plan under which the company pays fixed contributions into a separate entity and will have no legal or constructive obligation to pay further amounts. Obligations for contributions to defined contribution pension plans are recognised as an expense in the profit and loss in the periods during which services are rendered by employees.

 

Share-based payments       

Certain employees (including Directors and senior executives) of the Group receive remuneration in the form of equity-settled share-based payment transactions, whereby employees render services as consideration for equity instruments (equity-settled transactions, through the Growth Share Scheme, Approved and Unapproved Options Schemes). The cost of share-based payments is recharged by the Company to subsidiary undertakings in proportion to the services recognised.

 

Equity-settled share based schemes are measured at  fair value, excluding the effect of non-market based vesting conditions, at the date on which they are granted. The fair value is determined by using an appropriate pricing model.

 

The cost of equity-settled transactions is recognised, together with a corresponding increase in equity, over the period in which the performance and/or service conditions are fulfilled, ending on the date on which the relevant employees become fully entitled to the award (the vesting date). The cumulative expense recognised for equity-settled transactions at each reporting date until the vesting date reflects the extent to which the vesting period has expired and the Group's best estimate of the number of equity instruments that will ultimately vest. The profit or loss charge or credit for a period represents the movement in cumulative expense recognised as at the beginning and end of that period.

 

 

No expense is recognised for awards that do not ultimately vest, except for awards where vesting is conditional upon a market condition, which are treated as vesting irrespective of whether or not the market condition is satisfied, provided that all other performance and/or service conditions are satisfied. The dilutive effect of outstanding options is reflected as additional share dilution in the computation of earnings per share.

 

3   Financial Instruments

The Group is exposed through its operations to the following financial risks:

 

·      Credit risk

·      Interest rate risk

·      Liquidity Risk

 

In common with all other businesses, the Group is exposed to risks that arise from its use of financial instruments. This note describes the Group's objectives, policies and processes for managing those risks and the methods used to measure them. Further quantitative information in respect of these risks is presented throughout these financial statements.

 

There have been no substantive changes in the Group's exposure to financial instrument risks, it's objectives, policies and processes for managing those risks or the methods used to measure them from previous periods unless otherwise stated in this note.

 

The principal financial instruments used by the Group, from which financial instrument risk arises are as follows:

 

·      Trade receivables

·      Cash and cash equivalents

·      Trade and other payables

·      Floating rate bank revolving credit facilities and lease liabilities

 

Financial assets

All the Group's financial assets are subsequently accounted for at amortised cost. These assets arise principally from the provision of goods and services to customers (e.g. trade receivables), but also incorporate other types of financial assets where the objective is to hold these assets in order to collect contractual cash flows and the contractual cash flows are solely payments of principal and interest. They are initially recognised at fair value plus transaction costs that are directly attributable to their acquisition or issue, and are subsequently carried at amortised cost using the effective interest rate method, less provision for impairment.

 

Impairment provisions for trade receivables are recognised based on the simplified approach within IFRS 9 using a provision matrix in the determination of the lifetime expected credit losses. During this process the probability of the non-payment of the trade receivables is assessed. This probability is then multiplied by the amount of the expected loss arising from default to determine the lifetime expected credit loss for the trade receivables. For trade receivables, which are reported net, such provisions are recorded in a separate provision account with the loss being recognised in profit or loss. On confirmation that the trade receivable will not be collectable, the gross carrying value of the asset is written off against the associated provision.

 

The Group's financial assets measured at amortised cost comprise trade and other receivables and cash and cash equivalents in the consolidated balance sheet.

 

Cash and cash equivalents comprise cash balances, call deposits and cash amounts in transit due from credit cards which are settled within seven days from the date of the reporting period. Bank overdrafts that are repayable on demand and form an integral part of the Group's cash management are included as a component of cash and cash equivalents for the purpose only of the Statement of Cash Flows.

 

Financial liabilities and equity                                                          

Financial instruments issued by the Group are treated as equity only to the extent that they meet the following conditions:

                                                                                                                               

·      They include no contractual obligations upon the Group 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 Group

·      Where the instruments may be settled in the Group's own equity instruments, they are either a non-derivative that include no obligation to deliver a variable number of the Group's own equity instruments or they are a derivative that will be settled by the Group 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 and initially recognised at fair value net of any transaction costs directly attributable. Such interest-bearing liabilities are subsequently measured at amortised cost using the effective interest rate method, which ensures that any interest expense over the period to repayment is at a constant rate on the balance of the liability carried in the consolidated statement of financial position. For the purposes of each financial liability, interest expense includes initial transaction costs and any premium payable on redemption, as well as any interest or coupon payable while the liability is outstanding.

 

Credit risk

Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its contractual obligations. The Group is mainly exposed to credit risk from credit sales. It is Group policy, to assess the credit risk of new customers before entering material contracts.

 

Credit risk also arises from cash and cash equivalents and deposits with banks and financial institutions. For banks and financial institutions, only independently rated parties with minimum rating "A" are accepted.

 

Further disclosures regarding trade and other receivables, which are neither past due nor impaired, are provided in note 26.

 

Interest rate risk

The Group is exposed to cash flow interest rate risk from its revolving credit facility at variable rates. During 2022 and 2021, the Group's borrowings at variable rate were denominated in GBP.

 

The Group analyses the interest rate exposure on a monthly basis. A sensitivity analysis is performed by applying various reasonable expectations on rate changes to the expected facility drawdown.

 

Liquidity Risk

Liquidity risk arises from the Group's management of working capital and the finance charges and principal repayments on its debt instruments. It is the risk that the Group will encounter difficulty in meeting its financial obligations as they fall due. The Group's policy is to ensure that it will always have sufficient cash to allow it to meet its liabilities when they become due.

 

The Board receives rolling 12-month cash flow projections on a monthly basis as well as information regarding cash balances. At the end of the financial year, these projections indicated that the Group expected to have sufficient liquid resources to meet its obligations under all reasonably expected circumstances, through utilisation of its revolving credit facility. 

 

 

 

4   Changes in accounting policies

New standards, interpretations and amendments adopted from 1 January 2022

 

There are a number of standards, amendments to standards, and interpretations which have been issued by the IASB that are effective in future accounting periods that the Group has decided not to adopt early.

 

The following amendments are effective for the period beginning 1 January 2023:

 

·      Disclosure of Accounting Policies (Amendments to IAS 1 and IFRS Practice Statement 2);

·      Definition of Accounting Estimates (Amendments to IAS 8); and

·      Deferred Tax Related to Assets and Liabilities arising from a Single Transaction (Amendments to IAS 12)

 

The following amendments are effective for the period beginning 1 January 2024:

 

·      IFRS 16 Leases (Amendment - Liability in a Sale and Leaseback);

·      IAS 1 Presentation of Financial Statements (Amendment - Classification of Liabilities as Current or Non-Current)

·      IAS 1 Presentation of Financial Statements (Amendment - Non-Current Liabilities with Covenants)

 

The Group is currently assessing the impact of these new accounting standard and amendments.

 

The Group does not expect any other standards issued, but not yet effective, to have a material impact on the Group.

 

5   Critical accounting estimates and judgements

The Group makes certain estimates and assumptions regarding the future. Estimates and judgements are continually evaluated based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. In the future, actual experience may differ from these estimates and assumptions. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.

 

Impairment of goodwill, right-of-use assets and property, plant and equipment

The Group determines whether the above are impaired when impairment indicators exist or based on the annual impairment assessment. The annual assessment requires an estimate of the value in use of the CGUs to which the intangible and tangible fixed assets are allocated, which is predominantly at the individual cinema site level.

 

Estimating the value in use requires the Group to make an estimate of the expected future cash flows from each cinema and discount these to their net present value at an appropriate discount rate. All venues are located in the UK and therefore a single discount rate has been used for all CGUs. The resulting calculation is sensitive to the assumptions in respect of future cash flows and the discount rate applied. The Directors consider that the assumptions made represent their best estimate of the future cash flows generated by the CGUs and that the discount rates used are appropriate given the risks associated with the specific cash flows. A sensitivity analysis has been performed over the estimates (see Note 18).

 

Lease dilapidations

Future costs of repair and reinstatement obligations have been estimated by management using quotes or historical costs incurred for similar work and judgement based on experience and technical knowledge of employees with detailed knowledge of the premises and experience managing the estate. The costs are reviewed at least annually and updated based on physical inspections performed periodically.

 

 

 

 

 

 

 

 

6   Revenue

			Year ended	Year ended
			29 December	30 December
			2022	2021
			£000	£000
Film and entertainment			39,764	25,150
Food and beverages			32,250	20,360
Venue Hire, Advertising and Membership Income			6,803	3,517
			78,817	49,027

 

All trade takes place in the United Kingdom.

The following provides information about opening and closing receivables, contract assets and liabilities from contracts with customers.

 

Contract balances				29 December	30 December
				2022	2021
				£000	£000
Trade and other receivables				3,308	3,847
Deferred income				4,143	4,284

 

 

Deferred income relates to advanced consideration received from customers in respect of memberships, gift cards and advanced screenings.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

7   Loss before taxation

Loss before taxation is stated after charging:

		Year ended	Year ended
		29 December	30 December
		2022	2021
		£000	£000
Depreciation of tangible assets		7,721	8,030
Amortisation of right-of-use assets		3,342	3,078
Amortisation of intangible assets		662	619
Impairment reversal on right-of-use asset and property plant and equipment		-	(2,504)
Loss on disposal of property, plant and equipment		434	533
Operating lease income		(57)	(87)
Share-based payment expense		1,537	1,072
Rent concession gains from practical expedient		-	(701)

 

8   Staff numbers and employment costs      

The average number of employees (including Directors) during the year, analysed by category, was as follows:

 

				29 December	30 December
				2022	2021
				Number	Number
Management				222	186
Operations				1,032	731
				1,254	917

 

At the year end the number of employees (including Directors) was 1,380 (2021: 1,342)

Management staff represent all full-time employees in the Group.

				Year ended		Year ended
					29 December	30 December
					2022	2021
					£000	£000
Wages and salaries					20,374	14,982
Social security costs					1,718	1,211
Pension costs					306	224
Share-based payment expense					1,537	1,072
Other staff benefits					31	5
					23,966	17,494

 

There were pension liabilities outstanding as at 29 December 2022 of £62,000 (30 December 2021: £66,000).         

 

 

 

 

 

                                               

9   Directors' remuneration             

The remuneration of the Directors, who are the key management personnel of the Group, is set out below in aggregate for each of the categories specified in IAS24 Related Party Disclosures:

 

				Year ended	Year ended
				29 December	30 December
				2022	2021
				£000	£000
Salaries/fees				807	748
Bonuses				88	115
Other benefits				22	18
Pension contributions				14	15
				931	896
Share-based payment expense				869	720
				1,800	1,616

 

 

Information regarding the highest paid Director is as follows:

				Year ended	Year ended
				29 December	30 December
				2022	2021
				£000	£000
Salaries/fees				294	244
Bonuses				44	40
Other benefits				21	15
Pension contributions				10	9
				369	308
Share-based payment expense				598	750
				967	1,058

 

Directors remuneration for each Director is disclosed in the Remuneration Committee report. The costs relating to the Directors remuneration are wholly incurred by Everyman Media Limited for the wider Group. No Directors exercised options over shares in the Company during the year (2021: None).

 

 

10   Auditor's remuneration

		Year ended	Year ended
		29 December	30 December
		2022	2021
Fees payable to the Company's auditor for:		£000	£000
Audit of the Company's financial statements		24	12
Audit of the subsidiary undertakings of the Company		159	77
Taxation services to the Group		-	20
		183	109

 

 

11   Other Operating Income

		Year ended 29 December 2022 £'000		Year ended 30 December 2021 £'000
Coronavirus Job Retention Scheme	-			2,801
Business Grants			155	999
Landlord compensation			467	-
			622	3,800

 

12   Financial expenses

	Year ended	Year ended
	29 December	30 December
	2022	2021
	£000	£000
Interest on bank loans and overdrafts	983	595
Bank loan arrangement fees	60	85
Interest on lease liabilities	2,851	2,587
Interest on dilapidations provision	12	9
Reassessment of dilapidations NPV	-	(21)
	3,906	3,255

 

 

13   Taxation

	Year ended	Year ended
	29 December 2022	30 December 2021
	£000	£000
Tax expense
Current tax	-	-
Adjustment in respect of prior years	-	-
Total current tax credit
Deferred tax expense
Origination and reversal of temporary differences	-	416
Adjustment in respect of prior years	-	(101)
Effect of tax rate change	-	(301)
Total tax (credit)/expense	-	14

 

 

 

 

 

 

 

 

 

 

 

The reasons for the difference between the actual tax charge for the period and the standard rate of corporation tax in the United Kingdom applied to the (loss)/ profit for the year are as follows:

 

Reconciliation of effective tax rate	Year ended	Year ended
	29 December 2022	30 December 2021
	£000	£000
Loss before tax	(3,504)	(5,416)
Tax at the UK corporation tax rate of 19.00%	(666)	(1,029)
Permanent differences (expenses not deductible for tax purposes)	840	750
Impact of difference in overseas tax rates	-	1
De-recognition of losses	32	605
Effect of change in expected future statutory rates on deferred tax	(206)	(217)
Impact of a drop in share-based payments intrinsic value	-	5
Adjustment in respect of previous periods	-	(101)
Other	-	-
Total tax (credit)/expense	-	14

 

 

A reduction to 17% (effective 1 April 2020) was substantively enacted on 6 September 2016. In March 2020, it was announced that a rate of 19% would continue to apply with effect from 1 April 2020 and this change was substantively enacted from 17 March 2020.

 

An increase in the UK corporation rate from 19% to 25% (effective 1 April 2023) was substantively enacted on 24 May 2021. This will increase the company's future current tax charge accordingly.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

14   Earnings per share

	Year ended	Year ended
	29 December 2022	30 December 2021
	2021	2020
	£000	£000
Loss used in calculating basic and diluted earnings per share	(3,504)	(5,430)
Number of shares (000's)
Weighted average number of shares for the purpose of basic earnings per share	91,178	91,129
Number of shares (000's)
Weighted average number of shares for the purpose of diluted earnings per share	91,178	91,129
Basic loss per share (pence)	(3.84)	(5.96)
Diluted loss per share (pence)	(3.84)	(5.96)

 

	29 December	30 December
	2022	2021
	Weighted average	Weighted average
	no. 000's	no. 000's
Issued at beginning of the year	91,163	91,095
Share options exercised	15	34
Weighted average number of shares at end of the year	91,178	91,129

 

Weighted average number of shares for the purpose of diluted earnings per share
Basic weighted average number of shares	91,178	91,129
Effect of share options in issue	-	-
Weighted average number of shares at end of the year	91,178	91,129

 

Basic earnings per share values are calculated by dividing net profit/(loss) for the year attributable to Ordinary equity holders of the parent by the weighted average number of Ordinary shares outstanding during the year. The shares issued in the year in the above table reflect the weighted number of shares rather than the actual number of shares issued.

 

The Company has 7m potentially issuable Ordinary shares (2021: 7m) all of which relate to the potential dilution from share options issued to the Directors and certain employees and contractors, under the Group's incentive arrangements. In the current year these options are anti-dilutive as they would reduce the loss per share and so haven't been included in the diluted earnings per share.

 

 

 

 

 

 

15   Property, plant and equipment

	Land &	Leasehold	Plant &	Fixtures &	Assets under
	Buildings	improvements	machinery	Fittings	construction	Total
	£000	£000	£000	£000	£000	£000
Cost
At 31 December 2020	6,529	75,623	15,998	9,940	1,624	109,714
Acquired in the year	-	1,648	954	395	4,394	7,391
Disposals	-	(1,189)	(4,382)	(1,156)	(59)	(6,786)
Transfer on completion	-	96	-	-	(96)	-
At 30 December 2021	6,529	76,178	12,570	9,179	5,863	110,319
Acquired in the year	1,278	977	830	406	16,102	19,593
Disposals	-	(648)	(284)	(425)	-	(1,357)
Transfer on completion	-	7,950	3,060	4,433	(15,443)	-
Re-classified to non-current assets held for sale	(3,398)	-	-	-	-	(3,398)
At 29 December 2022	4,409	84,457	16,176	13,593	6,522	125,157
Depreciation
At 31 December 2020	159	14,415	9,173	4,402	-	28,149
Charge for the year	48	4,104	2,574	1,304	-	8,030
Impairment	-	(1,124)	(75)	(167)	-	(1,366)
On Disposals	-	(925)	(4,312)	(1,105)	-	(6,342)
At 30 December 2021	207	16,470	7,360	4,434	-	28,471
Charge for the year	42	3,850	2,536	1,293	-	7,721
On Disposals	-	(523)	(129)	(271)	-	(923)
Re-classified to non-current assets held for sale	(179)	-	-	-	-	(179)
At 29 December 2022	70	19,797	9,767	5,456	-	35,090
Net book value
At 29 December 2022	4,339	64,660	6,409	8,137	6,522	90,067
At 30 December 2021	6,322	59,708	5,210	4,745	5,863	81,848
At 31 December 2020	6,433	61,143	6,825	5,538	1,626	81,565

 

 

For impairment considerations of tangible fixed assets this was considered using the value in use basis disclosed in Note 18.

 

 

 

 

 

 

16 Non-current assets held for sale

 

General description:

 

In September 2022, the board announced its intention to sell the Freehold Investment property, 25 Church Road, London SE19 2TE to a suitable buyer. Therefore, as at 1 October 2022, the property was no longer depreciated and was re-classified as held for sale.

The property is owned by ECPEE Limited, a subsidiary of the Group.

 

Subject to contract, ECPEE will sell the freehold interest in the property to the buyer, and the buyer will then grant the lease back to ECPEE. The sale was not completed as at 29 December 2022, and therefore the property has been classified as held for sale.

 

Disposal activities after reporting period not recognised:

 

The sale and leaseback of 25 Church Road, London SE19 2TE was concluded through exchange of contracts on 16 January 2023 with a suitable buyer.

 

Assets and liabilities held for sale:

 

	29 December 2022 £'000	30 December 2021 £'000
Freehold property	3,219	-
Assets held for sale	3,219	-

 

The freehold property transferred from Property, plant and equipment to assets held for sale was valued immediately before the transfer, using a fair market value carried out by external qualified valuers. Fair value less cost to sell was higher than net book value and consequently no impairment charge is required.

 

17   Leases

Lease liabilities are measured at the present value of the contractual payments due to the lessor over the lease term, with the discount rate determined by reference to the rate inherent in the lease unless (as is typically the case) this is not readily determinable, in which case the Group's incremental borrowing rate on commencement of the lease is used.

 

On initial recognition, the carrying value of the lease liability also includes:

 

·      amounts expected to be payable under any residual value guarantee;

Right of use assets are initially measured at the amount of the lease liability, reduced for any lease incentives received, and increased for:

 

·      lease payments made at or before commencement of the lease;

·      initial direct costs incurred; and

·      the amount of any provision recognised where the Group is contractually required to dismantle, remove or restore the leased asset (typically leasehold dilapidations - see note 27).

 

Subsequent to initial measurement lease liabilities increase as a result of interest charged at a constant rate on the balance outstanding and are reduced for lease payments made. Right-of-use assets are amortised on a straight-line basis over the remaining term of the lease or over the remaining economic life of the asset if, rarely, this is judged to be shorter than the lease term.

 

If the Group revises its estimate of the term of any lease it adjusts the carrying amount of the lease liability to reflect the payments to make over the revised term, which are discounted using a revised discount rate. An equivalent adjustment is made to the carrying value of the right-of-use asset, with the revised carrying amount being amortised over the remaining (revised) lease term. If the carrying amount of the right-of-use asset is adjusted to zero, any further reduction is recognised in profit or loss.

 

Nature of leasing activities

 

The Group leases a number of properties in the towns and cities from which it operates. In some locations, depending on the lease contract signed, the lease payments may increase each year by inflation or and in others they are reset periodically to market rental rates. For some property leases the periodic rent is fixed over the lease term.

 

The Group also leases certain vehicles. Leases of vehicles comprise only fixed payments over the lease terms.

 

The percentages in the table below reflect the current proportions of lease payments that are either fixed or variable. The sensitivity reflects the impact on the carrying amount of lease liabilities and right-of-use assets if there was an uplift of 5% on the balance sheet date to lease payments that are variable.

 

During 2022 the Group entered into two property leases for new venues for a period of 20 and 25 years. The leases had not commenced by the year end and as a result, a lease liability and right-of-use asset has not been recognised at 29 December 2022. The aggregate future cash outflows to which the Group is exposed in respect of these contracts is fixed payments of £222,000 per year for the next 5 years, with upward only rent reviews every 5 years.

 

 

29 December 2022	Lease contract No.	Fixed payments %	Variable payments %	Sensitivity (+/-) £'000
Property leases with payments linked to inflation	21	-	50%	2,799
Property leases with periodic uplifts to market rentals	17	-	43%	1,316
Property leases with fixed payments	2	6%	-	-
Vehicle leases	3	1%	-	-
	43	7%	93%	4,115

 

The percentages in the table below reflect the proportions of lease payments that are either fixed or variable for the comparative period.

 

30 December 2021	Lease contract No.	Fixed payments %	Variable payments %	Sensitivity (+/-) £'000
Property leases with payments linked to inflation	19	-	51%	2,635
Property leases with periodic uplifts to market rentals	16	-	41%	1,255
Property leases with fixed payments	2	7%	-	-
Vehicle leases	3	1%	-	-
	40	8%	92%	3,890

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Right-of-Use Assets

 

	Land & Buildings £'000	Motor Vehicles £'000			Total £'000
As at 31 December 2020	56,723	22			56,745
Additions	4,357	30			4,387
Amortisation	(3,055)	(23)			(3,078)
Impairment reversal	1,133	-			1,133
Effect of modification to lease terms	(594)	-			(594)
At 30 December 2021	58,564	29			58,593
Additions	2,540		43	2,583
Amortisation	(3,325)		(17)	(3,342)
Effect of modification to lease terms	1,086		-	1,086
At 29 December 2022	58,865		55	58,920

 

 

 

 

 

 

Lease Liabilities

	Land & Buildings £'000	Motor Vehicles £'000	Total £'000
At 31 December 2020	79,050	18	79,068
Additions	5,003	30	5,033
Interest expense	2,586	1	2,587
Effect of modification to lease terms	(594)	-	(594)
Rent concession gains	(701)	-	(701)
Lease payments	(4,088)	(25)	(4,113)
Landlord contributions	500	-	500
At 30 December 2021	81,756	24	81,780
Additions	2,465	43	2,508
Interest expense	2,850	1	2,851
Effect of modification to lease terms	845	-	845
Lease payments	(6,045)	(16)	(6,061)
Landlord contributions	4,550	-	4,550
At 29 December 2022	86,421	52	86,473

 

Landlord contributions received after lease commencement date are shown in the table above. A further contribution of £455,000 (2021: £nil) was received prior to lease commencement and therefore total cash received from landlords during the year, as presented in the cash flow statement, was £5,005,000 (2021: £500,000).	29 December 2022  £'000	30 December 2021  £'000
Lease liabilities
Current	3,014	2,633
Non-current	83,459	79,147
	86,473	81,780

Rent Concessions

During 2020 and 2021, the Group received numerous forms of rent concessions from lessors due to the Group being unable to operate for significant periods of time. These concessions included rent forgiveness and deferrals.

 

As discussed in note 2 in the annual financial statements for the year ended 30 December 2021, the Group has elected to apply the practical expedient introduced by the amendments to IFRS 16 to all rent concessions that satisfy the criteria. Substantially all the rent concessions entered into during 2021 satisfied the criteria to apply the practical expedient. For any of the modifications that did not meet the practical expedient requirements; the lease liability was remeasured using the discount rate applicable at the date of modification, with the right of use being adjusted by the same amount.

 

The application of the practical expedient in 2021 resulted in the reduction of total lease liabilities of £701,000. During the year ended 29 December 2022 no new rent concessions were agreed.

 

 

 

Maturity analysis of lease payments

	29 December 2022 £'000	30 December 2021 £'000
Contractual future cash outflows
Land and buildings
Less than one year	5,998	5,291
Between one and five years	24,916	22,794
Over five years	90,989	87,239
	121,903	115,324
Motor Vehicles
Less than one year	24	13
Between one and five years	29	11
	53	24

 

Other lease disclosures

	29 December 2022 £'000	30 December 2021 £'000
Expenses relating to variable lease payments not included in the measurement of lease liabilities	113	38

 

 

Maturity analysis of lease receipts

(Receipts arising from the Group being a lessor)

	29 December  2022 £'000	30 December 2021 £'000
Contractual future cash inflows
Land and buildings
Less than one year	4	65
Between one and five years	-	16
	4	81

 

The reduction in future cash inflows at 29 December 2022 arises from a termination in the leasing arrangement for the property.

 

18   Goodwill, intangible assets and impairment

The Group is required to test, on an annual basis, whether goodwill has suffered any impairment. The recoverable amount is determined based on value in use calculations. The use of this method requires the estimation of future cash flows and the determination of a discount rate in order to calculate the present value of the cash flows.

 

	Goodwill £'000	Software £'000	Total £'000
Cost
At 31 December 2020	8,951	2,991	11,942
Acquired in the year	-	423	423
Disposed in the year	-	(546)	(546)
At 30 December 2021	8,951	2,868	11,819
Acquired in the year	-	1,068	1,068
At 29 December 2022	8,951	3,936	12,887
Amortisation and impairment	-
At 30 December 2020	1,599	1,203	2,802
Charge for the year	-	619	619
Disposed in the year	-	(503)	(503)
Impairment	-	(5)	(5)
At 30 December 2021	1,599	1,314	2,913
Charge for the year	-	662	662
At 29 December 2022	1,599	1,976	3,575
Net book value
At 29 December 2022	7,352	1,960	9,312
At 30 December 2021	7,352	1,554	8,906
At 2 January 2020	7,352	1,788	9,140

Impairment Review

 

The Group evaluates assets for impairment annually or when indicators of impairment exist. As required by IAS 36, the Group assessed whether there was an indication that a previously recognised impairment no longer exists or may have decreased. A reversal of an impairment is only recognised if there has been a change in the estimates used to determine the asset's recoverable amount since the last impairment loss was recognised.

 

The annual impairment assessment requires an estimate of the value in use of each cash-generating unit (CGU) to which goodwill, property plant and equipment and right-of-use assets are allocated, which is the individual cinema level. The recoverable amount of a CGU is the higher of value in use and fair value less cost of disposal. The Group determines the recoverable amount with reference to its value in use.

 

 

 

 

 

 

 

 

Goodwill is allocated to the following CGUs:

 

 

			29 December	30 December
			2022	2021
			£000	£000
Baker Street			103	103
Barnet			1,309	1,309
Esher			2,804	2,804
Gerrards Cross			1,309	1,309
Islington			86	86
Muswell Hill			1,215	1,215
Oxted			102	102
Reigate			113	113
Walton-On-Thames			94	94
Winchester			217	217
			7,352	7,352

 

Estimating the value in use requires estimate of the expected future cash flows from each CGU and discount these to their net present value at a pre-tax discount rate. Forecast cash flows are derived from adjusted EBITDA generated by each CGU which is based on management's forecast performance. Cash flow forecasts have been prepared for each CGU by applying growth assumptions to key drivers of cash flows, including admissions, average ticket price, spend per head, direct and overhead costs.

 

The key assumptions of this calculation are shown below:

	29 December	30 December
	2022	2021
Discount rate	15.3%	13.1%
Long term growth rate	2%	2%
Number of years projected	5 years	5 years

 

 

Adjusted EBITDA used for 2023 is based on the Board approved budget and represents managements best estimate of future cashflows, it has been used as the base assumption within the forecast. In the remaining five-year forecast the following assumptions have been applied:

·      Admissions increase by 5.5% in 2024 representing continued recovery from impact of the pandemic. In 2024, forecast admissions remain 10% below pre- Covid19 levels.

·      EBITDA growth from 2025 -2027 includes lower admission growth rate than 2024 and expectations about increases in average ticket prices and spend per head.

·      For venues opened since 2019 that are early in their maturity curve, specific assumptions have been applied to the key drivers over the five- year forecast period.

Sensitivity analysis

 

Impairment reviews are sensitive to changes in key assumptions. Sensitivity analysis has been performed by considering incremental changes in assumptions of admission levels and discount rates. Goodwill cannot be written back once impaired. As a result, impairment of goodwill brought forward of £1,599,000 was excluded from the calculations.

 

 

 

Scenarios

 

The following sensitivity scenarios have been applied to the cash flow forecasts for stress testing purposes:

 

·      Admissions levels were increased by 1% in the upside case and decreased by 1% in the downside case; and

·      WACC was decreased by 1.5% in the upside case and increased by 1.5% in the downside case. WACC has been included in sensitivity analysis due to the increase in the cost of debt over the past financial year and relative uncertainty over the cost of debt going forward.

 

	Upside Case		Downside Case
	Change	Reversal of Previous Impairment	Change	Additional Impairment
		£000		£000
Admissions	+1.0%	360	-1.0%	(699)
WACC	-1.5%	895	+1.5%	(1,514)

 

Reversal of previous impairment relates to two venues impaired in prior periods. Additional impairment relates to two venues impaired in prior periods and three further venues.

 

The impact on the total impairment charge of applying the different scenarios explained above relates to two venues that were impaired in previous years. An impairment charge would not be triggered on any other venues based on the changes in these assumptions.

 

The following cumulative impairment charges have been recognised in previous periods and have not been reversed. Bought forward impairment of right-of-use assets and property, plant and equipment relates to two venues.

 

	29 December	30 December
	2022 £000	2021 £000
Goodwill	1,599	1,599
Right-of-use assets	724	724
Property, plant & equipment	808	808
Total	3,131	3,131

 

 

 

19  Inventories

			29 December	30 December
			2022	2021
			£000	£000
Food and beverages			656	638
Projection			34	73
			690	711

 

Finished goods recognised as cost of sales in the year amounted to £7,848,000 (2021: £5,054,000). The write-down of inventories to net realisable value amounted to £nil (2021: £nil).

 

20   Cash and cash equivalents

			29 December	30 December
			2022	2021
			£000	£000
Per balance sheet			3,701	4,240
Per cash flow statement			3,701	4,240

 

 

21    Trade and other receivables

 

			29 December	30 December
			2022	2021
			£000	£000
Included in current assets			5,840	5,649
Included in non-current assets			173	177
			6,013	5,826
Trade receivables			3,308	3,847
Social security and other taxation			-	1
Other receivables			241	210
Prepayments and accrued income			2,464	1,768
			6,013	5,826

 

There were no receivables that were considered to be impaired. There is no significant difference between the fair value of the other receivables and the values stated above. Other debtors include deposits paid in respect of long-term leases and have been recognised as non-current assets.

 

22   Trade and other payables

 

		29 December	30 December
		2022	2021
		£000	£000
Trade creditors		2,305	3,640
Social security and other taxation		1,819	1,051
Other creditors		589	10
Accrued expenses		6,344	7,009
Deferred income		4,514	4,284
		15,571	15,994

 

 

 

 

 

 

 

 

 

 

23   Loans and borrowings

 

		29 December	30 December
		2022	2021
		£000	£000
Bank borrowings
Current		247	119
Non-current		22,000	12,500
Total Bank Debt		22,247	12,619
Cash		(3,701)	(4,240)
Net Bank Debt		18,546	8,379

 

The Company agreed a £25 million RCF and £15m CLBILS loan facility with Barclays Bank PLC and Santander UK PLC in March 2021. Interest is charged at LIBOR/SONIA on the drawn-down balance on a 365/ACT D-basis (the nominal interest rate ranging between 1.65% and 2.65%). The capital sum of the RCF is repayable in full on or before 17 April 2024. The capital sum of the CLBILS is repayable in full on or before 17 January 2024.

 

Commitment fees are charged quarterly on any balances not drawn at 35% of the applicable rate of drawn funds. The face value is deemed to be the carrying value. The Group had drawn down £22 million of the £40 million debt facility as at 29 December 2022 (2021: £12.5 million).

 

 

24  Changes in liabilities from financing activities

 

 

	Non- current loans and borrowings	Current loans and borrowings	Lease liabilities	Total
	£000	£000	£000	£000
At 31 December 2021	12,500	119	81,780	94,399
Cash flows	9,500	-	(1,056)	8,444
Non- cash flows:
Interest accruing in period	-	128	2,851	2,979
Lease additions	-	-	3,680	3,680
Effect of modifications to lease terms	-	-	(782)	(782)
At 29 December 2022	22,000	247	86,473	108,720
At 1 January 2021	9,000	43	79,068	88,111
Cash flows	3,500		(3,613)	(113)
Non- cash flows:
Interest accruing in period	-	76	2,587	2,663
Lease additions	-	-	5,033	5,033
Effect of modifications to lease terms	-	-	(701)	(701)
Rent concessions	-	-	(594)	(594)
At 30 December 2021	12,500	119	81,780	94,399

 

 

 

 

 

 

 

25  Financial instruments                                                                                                                  

 

Investments, financial assets and financial liabilities, cash and cash equivalents and other interest-bearing loans and borrowings are measured at amortised cost and the Directors believe their present value is a reasonable approximation to their fair value.

 

		29 December	30 December
		2022	2021
		£000	£000
Financial assets measured at amortised cost
Cash and cash equivalents		3,704	4,240
Trade and other receivables		3,549	4,057
Accrued income		692	221
		7,945	8,518

 

		29 December	30 December
		2022	2021
		£000	£000
Financial liabilities measured at amortised cost
Bank borrowings		22,247	12,619
Trade Creditors		2,305	3,640
Leases		86,473	81,780
Other Creditors		589	8
Accrued expenses		6,344	7,009
		117,958	105,056

 

26 Financial risks

 

The Board has overall responsibility for the determination of the Group's risk management objectives and policies. The overall objective of the Board is to set policies that seek to reduce risk as far as possible without unduly affecting the Group's competitiveness and flexibility. The Group has not issued or used any financial instruments of a speculative nature and the Group does not contract derivative financial instruments such as forward currency contracts, interest rate swaps or similar instruments.

 

The Group is exposed to the following financial risks:                                                                                 

- Credit risk                                                                                                                          

- Liquidity risk                                                                                                                      

- Interest rate risk                                                                                                                               

                                                                               

To the extent financial instruments are not carried at fair value in the consolidated Balance Sheet, net book value approximates to fair value at 29 December 2022 and 30 December 2021.

 

Trade and other receivables are measured at amortised cost. Book values and expected cash flows are reviewed by the Board and there have been no impairment losses recognised on these assets.

 

Cash and cash equivalents are held in sterling and placed on deposit in UK banks. Trade and other payables are measured at book value and held at amortised cost.

 

Credit risk

Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its contractual obligations and arises principally from the Group's receivables from customers and investment securities.  

 

The Group is exposed to credit risk in respect of its receivables from its subsidiary companies. The recoverability of these balances is dependent upon the performance of these subsidiaries in future periods. The performance of the Company's subsidiaries is closely monitored by the Company's Board of Directors.

 

At 29 December 2022 the Group has trade receivables of £3,308,000 (2021: £4,243,000).  Trade receivables arise mainly from advertising and sponsorship revenue. The Group is exposed to credit risk in respect of these balances such that, if one or more of the customers encounters financial difficulties, this could materially and adversely affect the Group's financial results. The Group attempts to mitigate credit risk by assessing the credit rating of new customers prior to entering into contracts and by entering into contracts with customers with agreed credit terms. At 29 December 2022 the Directors have recognised expected credit losses of £Nil (2021: £109,000).

 

The maximum exposure to credit risk at the balance sheet date by class of financial instrument was:

	29 December	30 December
	2022	2021
	£000	£000
Ageing of receivables
<30 days	2,224	3,927
31-60 days	914	84
61-120 days	63	232
>120 days	107	-
	3,308	4,243

 

 

In determining the recoverability of trade receivables the Group considers any change in the credit quality of the trade receivable from the date credit was initially granted up to the reporting date. Credit risk is limited due to the customer base being diverse and unrelated. There has not been any impairment other than existing provisions in respect of trade receivables during the year (2021: £nil). There were no material expected credit losses in the year.

 

 

 

Liquidity risk

Liquidity risk arises from the Group's management of working capital. It is the risk that the Group will encounter difficulty in meeting its financial obligations as they fall due. The Group's policy is to ensure that it will always have sufficient cash to allow it to meet its liabilities when they become due. To achieve this aim, it seeks to maintain cash balances to meet its expected cash requirements as determined by regular cash flow forecasts prepared by management.

 

The Group's forecasts show sufficient headroom in banking covenants for the next 12 months.

 

Exposure to liquidity risk

The following are the remaining contractual maturities of financial liabilities at the reporting date. The amounts shown are gross, not discounted and include contractual interest payments and exclude the impact of netting agreements.

 

		Contractual cash flows
29 December 2022	Carrying amount	Less than one year	Between one and two years	Between three and five years	Over five years	Total
	£000	£000	£000	£000	£000	£000
Non-derivative financial liabilities
Secured bank facility	22,247	247	22,000	-		22,247
Trade creditors	2,305	2,305	-	-	-	2,305
Leases	86,473	5,998	6,230	18,687	90,988	121,903
Other creditors	589	589	-	-	-	589
Accrued expenses	6,344	6,344	-	-	-	6,344
	117,958	15,483	28,230	18,687	90,988	153,388

 

 

 

 

 

		Contractual cash flows
30 December 2021	Carrying	Less than	Between one	Between three	Over five
	amount	one year	and two years	and five years	years	Total
	£000	£000	£000	£000	£000	£000
Secured bank facility	12,619	2	496	13,992	-	14,490
Trade creditors	3,640	3,640	-	-	-	3,640
Leases	81,780	5,290	5,990	16,804	87,239	115,323
Other creditors	8	8	-	-	-	8
Accrued expenses	7,009	7,009	-	-	-	7,009
	105,056	15,949	6,486	30,796	87,239	140,470

 

Interest rate risk                                                                                                                 

Interest rate risk arose from the Group's holding of interest-bearing loans linked to LIBOR/SONIA. The Group is also exposed to interest rate risk in respect of its cash balances held pending investment in the growth of the Group's operations. The effect of interest rate changes in the Group's interest-bearing assets and liabilities is set out below.

 

In respect of interest-earning financial assets and interest-bearing financial liabilities, the following indicates their effective interest rates at the end of the year and the periods in which they mature:

 

	Effective	Maturing	Maturing	Maturing
	interest	within	between 1 to	between 2 to
	rate	1 year	2 years	5 years
	%	£000	£000	£000
At 30 December 2021
Bank borrowings	2.72%	119	-	12,500
Bank current and deposit balances	0.01%	4,240	-	-
At 29 December 2022
Bank borrowings	2.40%	247	22,000	-
Bank current and deposit balances	0.01%	3,701	-	-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The following table demonstrates the sensitivity to a reasonably plausible change in interest rates, with all other variables held constant, of the Group's profit and loss before tax through the impact on floating rate borrowings and bank deposits and cash flows:

	Change in	29 December	30 December
	rate	2022	2021
	%	£000	£000
Bank borrowings	0.5%	111	63
	1.0%	222	126
	1.5%	333	189
Bank current and deposit balances	0.5%	18	19
	1.0%	37	37
	1.5%	55	56

 

 

 

 

 

Capital management           

The Group's capital is made up of share capital, share premium, merger reserve and retained earnings totalling £46.3m (2021 £48.2m).

 

The Group's objectives when maintaining capital are:

·    To safeguard the entity's ability to continue as a going concern so that it can continue to provide returns for shareholders and benefits for other stakeholders.

·    To provide an adequate return to shareholders by pricing products and services commensurately with the level of risk.

 

The capital structure of the Group consists of shareholders equity as set out in the consolidated statement of changes in equity. All funding required to set-up new cinema sites and for working capital purposes are financed from existing cash resources where possible. Management will also consider future fundraising or bank finance where appropriate.

 

27  Provisions

 

		Other provisions £,000	Leasehold Dilapidations £,000	Total £,000
As at 30 December 2021		393	1,118	1,511
Utilised in the year		(393)	-	(393)
Additions		-	97	97
Other increases		-	135	135
Unwinding of discount		-	12	12
As at 29 December 2022		-	1,362	1,362
Due within one year or less		-	-	-
Due within one to five years		-	44	44
Due after more than five years		-	1,318	1,318
		-	1,362	1,362

Leasehold dilapidations relate to the estimated cost of returning leasehold property to its original state at the end of the lease in accordance with lease terms. The cost is recognised as depreciation of leasehold improvements over the remaining term of the lease. The main uncertainty relates to estimating the cost that will be incurred at the end of the lease term, the average remaining lease term for leases held at 29 December 2022 was 18 years (2021:18 years).

 

28   Deferred tax

                                                                                       

	29 December	30 December
	2022	2021
	£000	£000
Deferred tax gross movements
Opening balance deferred tax liability	-	(14)
Recognised in profit and loss
Arising on loss carried forward	(1,455)	(426)
Net book value in excess of tax written down value	1,206	784
Movement on share option intrinsic value	245	(257)
Amortisation of IFRS accumulated restatement	49	(144)
Lease acquired	(62)	(29)
Other temporary differences	17	86
Credit/Charge to profit and loss	-	14
Deferred tax comprises:
Temporary differences on property, plant and equipment	5,723	4,627
Temporary differences on IFRS 16 accumulated restatement	(598)	(646)
Temporary differences on leases acquired	-	62
Share-option scheme intrinsic value	(28)	(273)
Available losses	(5,376)	(4,030)
Other temporary and deductible differences	279	260
	-	-

 

 

Deferred tax is calculated in full on temporary differences under the liability method using the tax rates that have been substantively enacted for future periods, being 25% from 1 April 2023. The deferred tax liability has arisen due to the timing difference on property, plant and equipment, the deferral of capital gains tax arising from the sale of a property and other temporary and deductible differences. Deferred tax assets have been recognised in respect of tax losses and other temporary differences giving rise to deferred tax assets where the Directors believe it is probable that they will be recovered. The Group has unused tax losses of approximately £30.0m in relation to UK losses and an unprovided deferred tax asset of £2.1m.

 

 

 

 

 

 

 

29   Share capital and reserves

 

		29 December	30 December
	Nominal	2022	2021
	value	£000	£000
Authorised, issued and fully paid Ordinary shares	£0.10
At the start of the year		9,117	9,110
Issued in the year		1	7
At the end of the year		9,118	9,117
Number of shares		29 December	30 December
		2022	2021
		Number	Number
Authorised, issued and fully paid Ordinary shares
At the start of the year		91,162,969	91,095,469
Issued in the year		15,000	67,500
At the end of the year		91,177,969	91,162,969

 

The holders of Ordinary shares are entitled to one vote per share. During the year the Company issued 15,000 Ordinary shares at a price of 109.5p (2021 67,500 Ordinary shares at prices ranging from 93.5p to 100p)..

 

Merger reserve

In accordance with s612 of the Companies Act, the premium on Ordinary shares issued in relation to acquisitions is recorded as a merger reserve.

                               

Share premium   

Share premium is stated net of share issue costs.

 

Dividends

No dividends were declared or paid during the period (2021: £nil)

 

30  Share-based payment arrangements

 

EMI, Non-Qualifying and LTIP Schemes

 

The Group operates three equity-settled share-based remuneration schemes for employees. The schemes combine a long term incentive scheme, an EMI scheme and an unapproved scheme for certain senior management, executive Directors, non-executive Directors and certain contractors.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The terms and conditions of the grants are as follows:

		Method of	Instruments outstanding	Vesting	Contractual life
Persons entitled	Grant date	Settlement	000's	Conditions*	of options
Management employees, Directors and contractors	29.10.2013	Equity-settled	98	1	10 years
Management employees, Directors and contractors	29.10.2013	Equity-settled	150	2	10 years
Directors	04.11.2013	Equity-settled	50	2	10 years
Management employees, Directors and contractors	29.10.2015	Equity-settled	218	3	10 years
Management employees	15.12.2016	Equity-settled	80	4	10 years
Management employees	10.01.2017	Equity-settled	30	4	10 years
Directors	13.03.2017	Equity-settled	250	4	10 years
Management employees and contractors	11.10.2017	Equity-settled	425	4	10 years
Management employees and Directors	23.11.2017	Equity-settled	87	5	10 years
Management employees and Directors	23.04.2018	Equity-settled	30	6	10 years
Management employees and contractors	02.10.2018	Equity-settled	205	4	10 years
Management employees	03.10.2018	Equity-settled	15	7	10 years
Management employees	05.11.2018	Equity-settled	1	7	10 years
Management employees and Directors	24.09.2019	Equity-settled	698	4	10 years
Management employees and Directors	30.04.2020	Equity-settled	550	4	10 years
Management employees	30.09.2020	Equity-settled	250	4	10 years
Directors	12.11.2020	Equity-settled	1,600	4	10 years
Management employees and Directors	22.12.2020	Equity-settled	150	4	10 years
Directors	08.04.2021	Equity-settled	1,000	8	10 years
Management employees	22.11.2021	Equity-settled	75	4	10 years
Management employees	17.03.2022	Equity-settled	585	4	10 years
Management employees	30.04.2022	Equity-settled	5	4	10 years
Management employees and Directors	05.05.2022	Equity-settled	175	4	10 years
Management employees and Directors	27.06.2022	Equity-settled	125	4	10 years
Management employees and Directors	24.10.2022	Equity settled	123	9	10 years
			6,974

 

*1 EMI options. These vest in equal tranches on the first, second and third anniversaries of the date of grant.

*2 Unapproved options. These vest in equal tranches on the first, second and third anniversaries of the date of grant.

*3 Unapproved options. These vest in equal tranches on the first, second and third anniversaries of the date of grant. Each tranche is exercisable if the Company share price exceeds £1.30, £1.50 and £1.80 respectively for 15 consecutive trading days.

*4 Unapproved options. These vest on the third anniversary of the date of grant.

*5 Unapproved options as part of the long-term incentive plan. These vest on the fifth anniversary of the date of grant. Half of the options are exercisable if the share price exceeds £2.10 for 2 consecutive trading days within 60 days following the announcement of the preliminary results for 2017. The other half of the options are exercisable based on internal Adjusted EBITDA targets.

*6 Unapproved options as part of the long-term incentive plan. These vest 4 years and 7 months from the date of grant. 45% of the options are exercisable if the share price exceeds £2.95 for 2 consecutive trading days within 60 days following the announcement of the preliminary results for 2018. The other 55% of the options are exercisable based on internal Adjusted EBITDA targets.

*7 Unapproved options as part of the long-term incentive plan. These vest 4 years and 2 months from the date of grant. 45% of the options are exercisable if the share price exceeds £2.95 for 2 consecutive trading days within 60 days following the announcement of the preliminary results for 2018. The other 55% of the options are exercisable based on internal Adjusted EBITDA targets.

*8 Unapproved options. These vested on the 31^st December 2021 and can be exercised subject to continued employment. The exercise price is £1.50.

 

 

*9 Unapproved options as part of the long-term incentive plan. These vest 3 years and 2 months from the date of grant. Between 40% and 100% of the options are exercisable based on internal Adjusted EBITDA targets.

 

All equity-settled share options are measured at fair value as determined through use of the Binomial technique, at the date of grant, aside from those with market-based performance conditions, which are valued using the Monte Carlo model. During the year, no equity-settled share options were issued with market-based performance conditions.

 

The fair value determined at the grant date of the equity-settled share-based payments is expensed on a straight-line basis over the vesting period, based on the Group and Company's estimate of shares that will eventually vest and adjusted for the effect of non-market-based vesting conditions.

 

The inputs into the Binomial model for the share options issued in the year were as follows:           

 

Option scheme conditions for options issued in the year:	29 December	29 December
	2022	2022
	Performance	No performance
	criteria	criteria
Weighted average share price at grant date (pence)	0.95	120.0
Weighted average option exercise prices (pence)	0.10	120.0
Expected volatility	40.0%	40.0%
Expected option life	4 years	3 years
Weighted average contractual life of outstanding share options	10 years	10 years
Risk-free interest rate	1.57%	1.57%
Expected dividend yield	0.0%	0.0%
Fair value of options granted in the year (pence)	0.85	0.54

 

 

Volatility has been calculated based on historical share price movements of the Company as at each grant date. Prospective volatility estimates have been adjusted to remove the impact of high volatility experienced in mid-March 2020, related to Covid-19.

 

 

 

 

 

 

 

 

	Weighted average exercise
	price per share in the year ended
	29 December	30 December	29 December	30 December
	2022	2021	2022	2021
	Pence	Pence	Number	Number
Options at the beginning of the year	142.00	109.50	6,925,003	6,559,818
Options issued in the year	0.75	0.72	1,518,543	1,860,888
Options exercised in the year	1.09	0.94	(15,000)	(67,500)
Option forfeited in the year	0.69	0.89	(1,454,713)	(1,428,203)
Options at the end of the year	104.28	142.00	6,973,833	6,925,003

 

No options lapsed beyond their contractual life in the year (Year ended 2021: nil).

 

Growth Shares

 

Under the A Growth Share Scheme, Alex Scrimgeour was issued with 2,000,000 A shares in Everyman Media Holdings Limited on 8 April 2021. The rights attaching to the A shares include a put option which, when exercised, enable the shareholder to convert the shares into ordinary shares of the Company. The Growth Shares in Everyman Media Holdings Ltd will vest subject to the achievement of share price targets. 1,000,000 Growth Shares in Everyman Media Holdings Ltd will vest if the Company has an average closing mid-market price of £2.25 or more over any 15 consecutive trading days ("Target 1"). The remaining 1,000,000 Growth Shares in Everyman Media Holdings Ltd will vest if the Company has an average closing mid-market price of £3.00 or more over any 15 consecutive trading days ("Target 2").

 

To the extent that the performance targets have been met, the Growth Shares in Everyman Media Holdings Limited will entitle Mr Scrimgeour to receive an amount equivalent to the market value of an ordinary share in the Company less £1. The vested Growth Shares shall be exchanged for ordinary shares in the Company on or after 31 December 2022 if Target 1 has been achieved and on or after 31 December 2023 if Target 2 has been achieved, provided that if a change of control of the Company occurs at any time, any vested Growth Shares which have not been exchanged by then, shall be exchanged on the change of control of the Company. 

Details of the outstanding shares under the A Growth Share Scheme are as follows:

	29 December	30 December
	2022	2021
Outstanding at beginning of year	2,000,000	-
Granted in year	-	2,000,000
Exercised in year	-	-
Outstanding at end of year	2,000,000	2,000,000

 

 

 

 

The Monte Carlo model was used for fair valuing the A Growth Share awards at the date of grant. The inputs to the model were as follows:

	A Growth Share Scheme
	Target 1	Target 2
Number of shares	1,000,000	1,000,000
Share price target	£2.25	£3.00
Expected volatility	45%	45%
Risk free interest rate	0.10%	0.10%
Option life (years)	5	5
Starting share price	£1.41	£1.41

 

Share-based payments charged to the profit and loss were as follows:

	29 December	30 December
	2022	2021
	£000	£000
Share options charge	939	625
Growth shares charge	598	447
Administrative costs	1,537	1,072

 

The charge for the Company was £nil (2021: £nil) after recharging subsidiary undertakings with a charge of £1,537,000 (2021: £1,072,000). The relevant charge is included within administrative costs.

 

There are 3,336,124 options exercisable at 29 December 2022 in respect of the current arrangements (2021: 1,488,103). 15,000 options were exercised in the year (2021: 67,500).

 

Volatility for options issued was determined by reference to movements in the share price over 5 years prior to the grant date. The market value conditions, where applicable, are reflected in the forfeited options following 60 days of the announcement of the annual results since the performance conditions are met/not met prior to the vesting period and as such no estimate of potential achievement of market values is required.

 

31   Commitments

 

There were capital commitments for tangible assets at 29 December 2022 of £15,878,000 (2021: £9,407,000). This amount is net of landlord contributions of £7,055,000 (2021: £7,820,000).

 

32   Events after the balance sheet date

 

Sale and Leaseback of Crystal Palace Venue

 

On 16 January 2023, the Group completed the sale and leaseback of its freehold property at 25 Church Road, London SE19 2TE. Proceeds from the sale, after associated fees and disbursements, were £3.8m. At the balance sheet date, the property was held for sale in ECPee Limited, with a carrying value of £3.2m.

 

As a result of the transaction, the Group will recognise a net profit on disposal of £0.6m in 52-week period ended 28 December 2023.

 

The leaseback element of the transaction is accounted for as a finance lease under IFRS 16. This will result in the recognition of a right of use asset and a lease liability in 2023.

 

Under the terms of the lease agreement, the Group has leased back the property for a period of 25 years at annual rent of £240,000. The rent is to be reviewed every five years. The first and second reviews are to be upwards only on an indexed basis by reference to increases in the Retail Prices All Items Indexed with a collar of 1% per annum and a cap of 4% per annum. The third and fourth reviews are on an upwards only basis to be the higher of the indexed rent (increased in accordance with the mechanism agreed for the first two reviews) and the open market rent pursuant to an open market rent review mechanism.

 

Extension of Banking Facilities

 

On 14th March 2023, the Group extended its £25m revolving credit facility ("RCF") by a period of 3 months, to 17 April 2024. The Group's residual £15m facility is a Coronavirus Large Business Interruption Loan Scheme ("CLBILS") and cannot be extended beyond its original maturity date of 17 January 2024.

 

The Group has begun a process to re-finance both the RCF and the CLBILS and expects to complete this in due course.

 

33   Related party transactions

 

In the year to 29 December 2022 the Group engaged services from entities related to the Directors and key management personnel of £617,000 (2021: £566,000) comprising consultancy services of £31,000 (2021: £10,000), office rental of £100,000 (2021: £98,000) and venue rental for Bristol, Harrogate and Maida Vale of £486,000 (2021: £458,000). Due to the pandemic the Group received rent discounts on the related properties amounting to a saving in 2022 of £nil (2021: £123,000). There were no other related party transactions. There are no key management personnel other than the Directors.

 

The Group's commitment to leases is set out in the above notes. Within the total of £122,000,000 (2021:£116,000,000) is an amount of £550,000 (2021:£650,000) relating to office rental, £4,523,000 (2021:£4,800,000) relating to Stratford-Upon-Avon, £3,596,000 (2021:£2,100,000) relating to Bristol and £4,670,000 (2021:£4,900,000) relating to Harrogate. The landlords of the sites are entities related to the Directors of the Company.

 

34   Ultimate controlling party

The Company has a diverse shareholding and is not under the control of any one person or entity.