TIDMCBOX
RNS Number : 2116Q
Cake Box Holdings PLC
27 June 2022
Cake Box Holdings plc
("Cake Box", "the Company" or "the Group")
Audited Full Year Results for the 12 months ended 31 March
2022
Strong results and robust current trading, confident of further
progress
Cake Box Holdings plc, the specialist retailer of fresh cream
cakes, today announces its audited full year results for the twelve
months ended 31 March 2022.
Financial Highlights
Full year Full year Change
ended ended
31-Mar-22 31-Mar-21
---------- ----------
Revenue GBP33.0m GBP21.9m +50.7%
---------- ---------- -------
Gross profit GBP15.8m GBP10.9m +45.0%
---------- ---------- -------
EBITDA* GBP8.8m GBP4.9m +79.6%
---------- ---------- -------
Pre-tax profit GBP7.7m GBP4.2m +83.3%
---------- ---------- -------
Adjusted Pre-tax profit** GBP7.0m GBP4.7m +48.9%
---------- ---------- -------
Cash at Bank GBP6.6m GBP5.1m +29.4%
---------- ---------- -------
Earnings per share 15.8p 8.4p +88.1%
---------- ---------- -------
Adjusted Earnings per
share** 13.8p 9.6p +43.8%
---------- ---------- -------
Final dividend recommended 5.1p 3.7p +37.8%
---------- ---------- -------
-- Group revenue up 50.7% to GBP33.0m (2021: GBP21.9m).
-- Gross margin reduced to 47.9% (2021: 49.8%), due to
exceptional increase in new store openings.
-- Cash from operations of GBP5.3m (2021: GBP4.3m).
-- Strong balance sheet with GBP6.6m cash at period end (2021: GBP5.1m).
-- Dividend per share for the full year: 5.1 pence per share
recommended (Interim dividend of 2.5 pence per share).
Operational highlights
-- 41% growth in online sales
-- Exceptional number of new franchise store openings, with 31 opened in the year (2021: 24).
-- 185 franchise stores in operation at the end of FY22 (2021: 157).
-- Continued expansion of kiosk offering ; now with 15
supermarket kiosks (2021:5); in addition to 20 kiosks in shopping
malls (2021:16).
-- New warehouse opened in Enfield in December 2021 to support ongoing expansion.
Franchisee store highlights
-- Like-for-like(1) sales growth of 12% in franchise stores in
ten-month period to 31 March 2022.(3)
-- Franchisee total turnover up 55% to GBP66.0m (2021: GBP42.7m)
-- Franchisee online sales up 41% to GBP13.3m (2021: GBP9.4m)
Current trading(2) and outlook
-- Sales have remained robust post period end against a very
strong comparative trading period in FY22. However, the Board
remains mindful of an increasingly challenging economic and trading
environment.
-- We continue to increase our geographic presence with a strong
store opening programme to drive future growth, whilst investing in
marketing to grow brand awareness and strengthening our digital
capabilities.
-- We have continued to invest in strengthening the Group's
senior leadership team and internal functions to improve governance
and processes to support a larger franchise estate .
Sukh Chamdal, Chief Executive Officer, commented:
"Despite a challenging economic and trading environment, we have
delivered yet another strong set of results and continue to trade
robustly post period end.
"I founded Cake Box at the height of the financial crisis in
2008. These are difficult times for everyone, but as we've seen
before, the Group's unique customer and franchisee proposition
remains both exciting and enticing. Our people have proven their
resilience and commitment through tough times and now is the time
for the Cake Box Family of extraordinary entrepreneurs to shine,
with support from a bigger, better and more experienced Group
function.
"The Cake Box Family is bigger and more geographically diverse
than ever before, and we are serving more customers than ever, with
a keen focus on value for money. As I said at the height of the
Covid pandemic, there will still be birthdays, marriages and
countless moments in our lives to celebrate with a slice of our
delicious cake."
EBITDA is calculated as operating profit before depreciation and
amortisation
** Calculated after adjusting for exceptional items (2022 -
GBP782k, 2021 - GBP486k) see note 10
(1) Like-for-like: Stores trading for at least one full
financial year prior to 31 March 2022
(2) Current trading defined as average store turnover for last
12 weeks to week ended 27 June 2022
(3) Trading was affected by COVID lockdowns and associated store
closures during the first 2 months of FY22
For further information, please contact:
Cake Box Holdings plc Enquiries via MHP Communications
Sukh Chamdal, CEO
David Forth, CFO
Shore Capital
Stephane Auton
Patrick Castle +44 (0) 20 7408 4090
MHP Communications +44 (0) 20 3128 8570
Simon Hockridge cakebox@mhpc.com
Pete Lambie
Chairman's Statement
Expanding our reach
We are very pleased with our performance over the last year,
with 31 new shop openings, taking our total store estate to 185,
and 14 new kiosks opened across both supermarkets and shopping
malls, bringing the total number to 35. Our Coventry depot is now
fully operational, meaning we have Enfield serving the South of
England, Bradford serving the North of England and Scotland, and
Coventry serving the Midlands and Wales. Having depots in these
strategic locations has also allowed to us to significantly reduce
our road mileage and carbon footprint. We have learned that
building capability early is key to sustaining the resilience of
the business.
The Board recognises and remains cognisant of the concerns
previously raised by some shareholders around the Group's internal
governance, finance and audit processes, and continues to work to
evolve, improve and further professionalise the Group, bringing in
the experience and capabilities to support our growth ambitions. We
have invested significantly in Cake Box's senior management and
Group functions, including the appointments of David Forth as
Interim Chief Financial Officer, Richard Zivkovic as Chief
Operating Officer and the creation of a new Chief Commercial
Officer role for Dr Jaswir Singh. As well ensuring our operation is
fit for purpose as we grow, we continue to review and improve
working with external partners, ensuring we run our business
effectively with accurate reporting.
During the period, we also recruited a new Marketing Director,
Chay Watkins, IT Director Paul Owers, a Customer Service Manager
and Learning & Development Manager as well as expanding the
Group's IT, Finance and procurement functions.
I would like to welcome all of our new colleagues to the Cake
Box Family and look forward to their contribution to our continued
future growth.
Through our strategic expansion, we have created the capacity to
significantly increase our volume and reach communities nationwide
and we remain focused on maximising productivity to meet the
additional demand. For the coming year we have a target of another
24 new store openings and we will continue with kiosk development.
This should bring us the 200th Cake Box store in the autumn of
2022, well in line with our stated ambition of having 250
stores.
We continue to successfully open stores in new areas throughout
the UK such as Sunderland, Cardiff and Exeter, increasing our
geographical presence and becoming a national brand. There are
still many opportunities for Cake Box within the UK, so for the
time being this is where we continue to concentrate our growth
plans.
Cake Box also continues to adapt and evolve in other ways.
E-commerce is a key sales channel, and we continue to increase our
capability and expand our customer reach through a dedicated
delivery service. This will form an integral part of our growth
over the next two to three years with the potential for Cake Box to
be a 50/50 online and bricks-and-mortar business.
Building resilience
To come out of the pandemic stronger, it has been key to support
our franchisees in setting up and growing their businesses. In the
period, we continued our already-established Franchise Support Fund
initiative, lending money during this financial year to franchisees
to help them set up and at a time when it has been hard to access
traditional lending.
The franchise model is unique in that it creates a community of
genuine entrepreneurs with the drive to make things work. We have a
healthy pipeline of franchisee applications for new stores and we
always welcome more entrepreneurs who want to run their own
businesses.
The increasing number of franchisee enquiries at Cake Box shows
that these entrepreneurs have an appetite to take control of their
lives and also their income, as well as creating additional
employment for others. Over the last four years, the Cake Box
franchise model has created hundreds of jobs across the UK.
Creating social value
Community has always been central to what we do, and why we
actively encourage our franchisees to engage with the communities
in which they operate through local initiatives. We support their
endeavours through money-raising initiatives - donating the
proceeds of carrier bag sales back into communities for example.
Our voluntary work at head office level also continues, including
our large-scale programme serving food to the homeless.
More recently, we have set up an Environmental, Social and
Governance (ESG) committee, focusing on how we conduct our
business, from the packaging we use through to miles travelled, and
how and where we source our products. We consider our ESG
activities to be a moral obligation to our investors, customers,
franchisees and supplier base. A huge focus going into 2023 and
beyond will be on how we measure the outcomes and set meaningful
targets.
Looking forward
The Cake Box Family can be incredibly proud of its achievements
over the past year. Achievements only made possible through the
collaborative culture that exists between our head office teams,
diverse franchisee community and a supplier base that has continued
to ensure no supply disruption despite the challenges they may have
faced. We must sometimes remind ourselves what we have achieved in
less than 11 years since we established the business and just four
years after the IPO. In such a short period, we have built a strong
brand with a solid loyalty base and huge growth trajectory. In what
is a cash-generative business, our cash position remains strong, as
does the overall balance sheet.
The Cake Box brand is a perfect example of how through
collaboration we can remain strong through times of adversity, and
we look forward to delivering value to our investors, customers and
franchisees over the long-term.
A Family of extraordinary entrepreneurs
It is critical in the current economic environment to remind
ourselves of what the Cake Box Family is. At its core, it is a
Family of extraordinary entrepreneurs up and down the country,
continuously creating jobs in their communities, often in
underserved areas of the UK where investment is needed and most of
the time, lacking.
To chair a business that ultimately provides a platform to
facilitate this entrepreneurship makes me incredibly proud. Taking
on a franchise and becoming a small business owner is a bold step
at the best of times, and I am constantly reminded of how
extraordinary our franchisees are when I meet them and hear about
their entrepreneurial journeys. I would like to thank the entire
Cake Box Family, our customers, our staff, franchisees and supply
base for their continued commitment, hard work and dedication over
the last year but also for the last two years of the pandemic.
Neil Sachdev MBE
Non-Executive Chairman
Chief Executive's review
Welcoming new franchisees
Despite the pandemic, we were able to uphold our unique
proposition of an egg-free celebration cake. Born at the height of
the 2008 recession, Cake Box learnt an important business lesson
that while people may cut down on essential items, celebrating a
special occasion provides that one chink of light. As a result, we
saw double-digit growth in 2021 with the opening of 31 new stores
and 14 kiosks across the UK.
One result of COVID-19 was that it prompted people to
re-evaluate their life goals and, in some cases, to start their own
business. They just needed that extra incentive and we were
delighted to welcome new franchisees into the business.
Providing training support
Training support to franchisees has been an essential part of
our business model prior to, during and since the pandemic. This
happens online, via email, weekly forums, and through our dedicated
hub where we provide training documents and videos that franchisees
can access to conduct their own induction and refresher
training.
During COVID-19, our training focus included topics such as
minimum social distancing, safe practices at the front and back of
house in often small operating spaces, hygiene and sanitisation,
and offering masks to customers entering the store.
Franchisee commitment
We always owe a debt of thanks to the commitment of our
franchisees. Our churn rate of shops changing hands remains low by
industry standards. This shows the commitment and trust of our
franchisees and ambitions to expand their business. 43% of our
franchisees have more than one store.
The average earnings from a Cake Box store provides an
attractive proposition for our franchisees, which is why there are
so many multi-store operators. Also, as owner occupiers, it is in
their interest that they operate optimally and efficiently. This in
turn increases our head office revenue.
Ongoing people strategy
The need to grow our infrastructure in line with the expansion
of our estate has guided both our distribution centre strategy and
recruitment policy. We now have three UK distribution centres
located in Enfield in the South, Bradford in the North, and more
recently Coventry in the Midlands, giving us a reach across the
whole of the UK, including Scotland and Wales.
We have also instigated a major recruitment drive of key head
office positions across health and safety, food safety, marketing,
HR, training, customer service and at C-suite level. Our long-term
strategy is to make sure that we have the right quality of people
to drive and sustain the business into the long-term.
Listening to the customer
It remains at the top of our agenda to give our customers the
products they want. We collect data from the verbal customer
feedback and online reviews our franchisees receive. We also have a
feedback form which customers respond to regularly with their
valuable insights. As a result, we can adjust our product offering
in line with customer needs.
A recent example is the feedback that some customers wanted less
cream on their cakes. This has resulted in our naked cake range,
which has been received very positively. It is through such
initiatives that we will be able to meet customer demands and set
trends in the coming years.
Continuing the Cake Box journey
Over the last year we have seen some excellent quality
franchisees come into the business. With 31 new store openings,
FY22 delivered extraordinary results. For FY23, we remain ambitious
while setting a realistic target of 24 new store openings.
It is interesting to reflect on the fact that when Cake Box
first began in 2008, it was restricted to serving very specific
communities. Today, our three main distribution centres can cater
for the entire UK and buffer us from any potential supply chain
issues, allowing us to distribute our products seamlessly and
ensure business continuity.
A cake is an emotional purchase. Whether the customer wants to
enjoy the sights and smells of a physical store or the convenience
of ordering from the comfort of their own home, our objective
remains the same - to provide the right cake to complete the
perfect occasion.
I would like to thank Pardip Dass, my co-founder who left the
business at the end of the financial year, for his important
contribution to making Cake Box the success it is today.
A bigger, better business
Despite a challenging economic and trading environment, we have
delivered yet another strong set of results and continue to trade
robustly post period end.
I founded Cake Box at the height of the financial crisis in
2008. These are difficult times for everyone, but as we've seen
before, the Group's unique customer and franchisee proposition
remains both exciting and enticing. Our people have proven their
resilience and commitment through tough times and now is the time
for the Cake Box Family of extraordinary entrepreneurs to shine,
with support from a bigger, better and more professional Group
function.
The Cake Box Family is bigger than ever before, and we are
serving more customers than ever, with a keen focus on value for
money. As I said at the height of the Covid pandemic, there will
still be birthdays, marriages and countless moments in our lives to
celebrate with a slice of our delicious, egg free cake.
Sukh Chamdal
Chief Executive Officer
Financial Review
FY22 FY21
GBPm GBPm
------------------------ ------ ------
Revenue 33.0 21.9
Gross profit 15.8 10.9
Operating expenses
before exceptional
items (8.8) (6.2)
Exceptional Items 0.8 (0.5)
Operating profit 7.8 4.2
Finance Cost (0.1) -
Profit before tax 7.7 4.2
Adjusted Profit before
tax* 7.0 4.7
Tax (1.4) (0.8)
------ ------
Profit for the period 6.3 3.4
Adjusted Profit for
the period* 5.5 3.9
------ ------
Revaluation of freehold 1.2 1.3***
property
Deferred tax on revaluation (0.2) (0.3)***
------ ---------
Total Comprehensive
income for the year 7.3 4.4
------ ---------
EBITDA** 8.8 4.9
* Calculated after adjusting for exceptional items (2022 -
GBP782k, 2021 + GBP486k) see note 10
** EBITDA is calculated as operating profit before depreciation
and amortisation
*** Prior year comparatives have been restated see note 20
Revenue
Reported revenue for the year FY22 was GBP33.0m. Revenue
increased by 50.7% compared to the previous financial year. This
was achieved through an increase in store like-for-like sales and
with the addition of 31 new stores around the UK in new locations
including Cardiff, Exeter, Bournemouth, Plymouth, Sunderland,
Chelmsford and Nuneaton.
Gross margin
Gross profit as a percentage of sales reduced from 47.9% from
49.8%, due to an exceptional increase in new store openings, with
new store set-up margins being lower than margins on sales of
products.
EBITDA
EBITDA increased by 79.6% to GBP8.8m as a result of the strong
increase in sales and control over costs.
Exceptional items
Following the website data breach that occurred in 2020, the
Group made a provision of GBP486k in FY21 allowing for legal and
professional fees and potential fines relating to the breach.
GBP243k of the original provision remains in place.
In FY22, despite the excellent performance of the Group, the
vesting conditions in the Executive Share Scheme were not met,
resulting in an exceptional gain of GBP486k to profit.
A review of provisions resulted in a further exceptional gain of
GBP296k from reversing an accrual for rates in previous years.
Balance Sheet
Cake Box has a strong balance sheet with a cash balance at the
year-end of GBP6.6m (FY21: GBP5.1m). The Group's only debts are
mortgages of GBP1.4m secured by its freehold properties in Enfield,
Bradford and Coventry.
The Group operates a franchise model and therefore has a
relatively low and flexible cost base. The Board is therefore very
comfortable with the Group's cash levels and liquidity despite the
unprecedented events of the last two years.
Property
Our three main sites at Enfield, Bradford and Coventry are all
freehold. At year end, we instructed surveyors to value all three
properties in order to have a consistent value base. This resulted
in a significant revaluation gain in respect of our head office
site in Enfield of GBP2.5m compared to the previous revaluation in
2019.
We also rented a 27,000 sq ft warehouse to in Enfield to support
our business expansion.
Taxation
The effective rate of taxation was 18.4% (FY21: 18.0%).
This is in line with relief obtained via the super deduction
claim, which is a temporary increase by HMRC to capital allowances
for capital expenditure of 130% compared to the normal rate of
100%, as well as other corporation tax timing differences on
capital assets
Earnings per share (EPS)
Un-adjusted earnings per share were 15.8p (FY21: 8.4p). An
increase of 88.1% reflecting the increase in profitability of the
Group. The number of shares in issue was 40,000,000 and is
unchanged since the Company's IPO in June 2018.
Dividend
Having delivered a year of strong growth, the Board is pleased
to recommend a final dividend of 5.1 pence per share (FY21: 3.7p),
bringing the total dividend for the year to 7.6 pence per share
(FY21: 5.55p).
If approved by the shareholders at the Company's AGM on 20th
September 2022, the final dividend of 5.1 pence per share will be
paid on 27(th) September 2022 to shareholders on the register on
26(th) August 2022.
As previously stated, the Company intends that the total
dividend for each year will split into one third for the first six
months of the year to two thirds for the year end.
Cash position
The Group had GBP6.6m of cash at year end, an increase of
GBP1.5m. At the year end, the Group had a net cash position of
GBP5.2m which was up GBP1.6m from the previous year.
Trade and other receivables
The Group had GBP2.6m of trade and other receivables at the end
of FY22, equal to the prior year. The majority of this balance
relates to trade receivables which have remained at GBP2.0m,
showing good credit control given the increase in revenue. Trading
debts relating to purchases of products by franchisees have a
defined seven-day payment term.
Trade and other payables
The Group had GBP2.7m of trade and other payables at the year
end, a reduction of GBP0.7m on the prior year. The Group actively
sources cost effective suppliers without compromising on the
quality of the products. Other payables are paid according to terms
specified.
We have been working with BDO as internal auditors to improve
the control environment across the company to ensure that it
remains appropriate to needs of a growing business.
David Forth
Interim Chief Financial Officer
Cake Box Holdings Plc
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
AS AT 31 MARCH 2022
Company Registration No. 08777765
As restated
2022 2021
Note GBP GBP
Revenue 3 32,964,846 21,910,862
Cost of sales (17,133,685) (10,978,993)
------------- -------------
Gross profit 15,831,161 10,931,869
Administrative expenses before
exceptional items (8,794,413) (6,198,981)
Exceptional items 10 781,965 (486,319)
----------------------------------- ----- ------------- -------------
Administrative expenses 4 (8,012,448) (6,685,300)
Operating profit 5 7,818,713 4,246,569
Finance income 6 1,802 4,087
Finance expense 6 (83,190) (41,386)
------------- -------------
Profit before income tax 7,737,325 4,209,270
Income tax expense 11 (1,425,709) (842,362)
Profit after income tax 6,311,616 3,366,908
Other comprehensive income for
the year
Revaluation of freehold property 13 1,250,175 1,274,901
Deferred tax on revaluation of
freehold property 12 (237,533) (242,231)
------------- -------------
Total other comprehensive income
for the year 1,012,642 1,032,670
Total comprehensive income for
the year 7,324,258 4,399,578
============= =============
Attributable to:
Equity holders of the parent 7,324,258 4,399,587
Earnings per share
Basic 32 15.78p 8.42p
Diluted 32 15.78p 8.42p
============= =============
The notes form part of these financial statements.
Cake Box Holdings Plc
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 MARCH 2022
Company Registration No. 08777765
As restated
2022 2021
Note GBP GBP
Assets
Non-current assets
Property, plant and equipment 13 10,029,209 8,501,602
Right-of-use assets 14 2,874,430 -
Other financial assets 17 710,059 656,004
Deferred tax asset 12 - 95,447
------------- ------------
13,613,698 9,253,053
------------- ------------
Current assets
Inventories 15 2,468,921 1,902,171
Trade and other receivables 16 2,553,209 2,490,217
Other financial assets 17 357,548 382,808
Cash and cash equivalents 31 6,571,558 5,125,864
11,951,236 9,901,060
------------- ------------
Total Assets 25,564,934 19,154,113
============= ============
Equity and liabilities
Equity
Issued share capital 18 400,000 400,000
Capital redemption reserve 19 40 40
Revaluation reserve 19 3,634,734 2,622,092
Share option reserve 21 - 488,596
Retained earnings 19 12,475,031 8,643,415
------------- ------------
Equity attributable to the owners
of the Parent company 16,509,805 12,154,143
------------- ------------
Current liabilities
Trade and other payables 23 2,661,372 3,353,749
Lease liabilities 14 260,191 -
Short-term borrowings 22 167,754 167,754
Current tax payable 837,946 903,469
Provisions 24 243,100 486,319
------------- ------------
4,170,363 4,911,291
------------- ------------
Non-current liabilities
Lease liabilities 14 2,699,958 -
Borrowings 22 1,185,978 1,318,005
Deferred tax liabilities 12 998,830 770,674
4,884,766 2,088,679
------------- ------------
Total Equity and Liabilities 25,564,934 19,154,113
============= ============
The financial statements were approved and authorised for issue
by the Board on _26 June 2022__ and signed on its behalf by:
S R Chamdal
Director
The notes form part of these financial statements.
Cake Box Holdings Plc
CONSOLIDATED CASH FLOW STATEMENT
FOR THE YEARED 31 MARCH 2022
As restated
Note 2022 2021
GBP GBP
Cash flows from operating activities
Profit before income tax 7,737,325 4,209,270
Adjusted for:
4 &
Depreciation 13 853,633 670,333
4 &
Amortisation of right-of-use assets 14 124,975 -
Exceptional items - 486,319
Profit on disposal of tangible fixed
assets (13,154) (18,972)
Increase in inventories (566,749) (505,936)
Increase in trade and other receivables (82,993) (1,172,048)
Increase in other financial assets (28,794) (893,749)
(Decrease)/increase in trade and
other payables (915,596) 1,860,596
Share based payment (credit)/charge (486,368) 288,000
Finance income (1,802) (4,087)
------------ ------------
Cash generated from operations 6,620,477 4,919,726
Finance costs 83,190 41,386
Taxation paid (1,407,391) (646,995)
Net cash inflow from operating
activities 5,296,276 4,314,117
------------ ------------
Cash flows from investing activities
Purchases of property, plant and
equipment (1,133,926) (704,959)
Proceeds from sale of property,
plant and equipment 16,014 26,446
Interest received 1,802 4,087
Net cash outflow from in investing
activities (1,116,110) (674,426)
------------ ------------
Cash flows from financing activities
Repayment of finance leases (39,255) -
Repayment of borrowings (132,027) (128,283)
Dividends paid 8 (2,480,000) (2,020,000)
Interest paid (83,190) (41,586)
------------ ------------
Net cash outflow from financing
activities (2,734,472) (2,189,869)
Net increase in cash and cash equivalents 1,445,694 1,449,822
Cash and cash equivalents brought
forward 5,125,864 3,676,042
Cash and cash equivalents carried
forward 31 6,571,558 5,125,864
------------ ------------
Prior year comparatives have been restated due to a change in
presentation for the other financial assets only.
The notes form part of these financial statements.
Cake Box Holdings Plc
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEARED 31 MARCH 2022
Attributable to the owners of the Parent Company
As restated As restated
Share Capital Share Revaluation Retained
capital redemption option reserve earnings Total
GBP reserve reserve GBP GBP GBP
GBP GBP
At 31 March
2020 400,000 40 198,368 1,589,422 7,296,507 9,484,337
Profit for the
year - - - - 3,366,908 3,366,908
Revaluation of
freehold
property - - - 1,274,901 - 1,274,901
Deferred tax
on
revaluation
of
freehold
property - - - (242,231) - (242,231)
-------------- -------------- -------------- -------------- ------------------------ ------------------------
Total
comprehensive
income for
the
year - - - 1,032,670 3,366,908 4,399,578
Transactions
with
owners in
their
capacity as
owners
Share-based
payments - - 288,000 - - 288,000
Deferred tax
on
share-based
payments 2,228 2,228
Dividends paid - - - - (2,020,000) (2,020,000)
--------------
At 31 March
2021 400,000 40 488,596 2,622,092 8,643,415 12,154,143
============== ============== ============== ============== ======================== ========================
Profit for the
year - - - - 6,311,616 6,311,616
Revaluation of
freehold
property - - - 1,250,175 - 1,250,175
Deferred tax
on
revaluation
of
freehold
property - - - (237,533) - (237,533)
Total
comprehensive
income for
the
year - - - 1,012,642 6,311,616 7,324,258
Transactions
with
owners in
their
capacity as
owners
Share-based
payments - - (486,368) - - (486,368)
Deferred tax
on
share-based
payments - - (2,228) - - (2,228)
Dividends paid - - - - (2,480,000) (2,480,000)
-------------- -------------- -------------- -------------- ------------------------ ------------------------
At 31 March
2022 400,000 40 - 3,634,734 12,475,031 16,509,805
============== ============== ============== ============== ======================== ========================
The notes form part of these financial statements.
Cake Box Holdings Plc
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARED 31 MARCH 2022
1. General information
Cake Box Holdings Plc is a listed company limited by shares,
incorporated and domiciled in England and Wales. Its registered
office is 20 - 22 Jute Lane, Enfield, Middlesex, EN3 7PJ.
The financial statements cover Cake Box Holdings Plc ('Company')
and the entities it controlled at the end of, or during, the
financial year (referred to as the 'Group').
The principal activity of the Group continues to be the
specialist retailer of fresh cream cakes and franchise
operator.
2. Accounting policies
2.1 Basis of preparation of financial statements
The financial information set out in this statement does not
constitute statutory accounts as defined in section 435 of the
Companies Act 2006. This set of financial results was approved by
the Board on 26 June 2022. The financial information for the years
ended 31 March 2022 and 31 March 2021 has been extracted from the
statutory accounts for each year. The auditors' report on the 2022
statutory accounts was (i) unqualified, (ii) did not include
references to any matters to which the auditor drew attention by
way emphasis without qualifying its reports and (iii) did not
contain statements under section S498(2) or S498(3) of the
Companies Act 2006. The audited statutory accounts for the year
ended 31 March 2021 have been delivered to the Registrar of
Companies.
The consolidated financial statements for the year ended 31
March 2022 have been prepared in accordance with United Kingdom
adopted International Financial Reporting Standards (UK Adopted
IFRS) and those parts of the Companies Act 2006 that are applicable
to companies which apply UK adopted IFRS.
The consolidated financial statements have been prepared under
the historical cost convention, other than certain classes of
property, plant and equipment.
The numbers presented in the financial statements have been
rounded to the nearest pound (GBP) unless otherwise stated.
Sources of estimation uncertainty
The preparation of financial statements under IFRS requires
management to make judgements, estimates and assumptions that
affect the application of accounting policies and reported amounts
of assets, liabilities, income and expenses. The estimates and
associated assumptions are based on historical experience and
factors that are believed to be reasonable under the circumstances,
the results of which form the basis of making judgements about
carrying values of assets and liabilities that are not readily
apparent from other sources. Actual results may differ from these
estimates. Estimates and assumptions are reviewed on an ongoing
basis and any revision to estimates or assumptions are recognised
in the period in which they are revised and in future periods
affected.
Significant judgements and estimates
The material areas in which estimates, and judgements are
applied are as follows:
Provisions - Judgement and Estimate
The Group had previously recognised provisions following a data
breach which impacted the Group's website payment system. The
provision relates to the fine received by the merchant service
provider, and estimated costs associated including potential fines
from the ICO in respect to GDPR breaches and associated legal and
professional fees. Management use judgement in respect of potential
fees and fines and estimates to calculate the quantum of costs.
Freehold property - Judgement
Freehold properties are held at valuation.
2.2 Functional and presentation currency
The currency of the primary economic environment in which the
Parent and its subsidiaries operate (the functional currency) is
Pound Sterling ("GBP or GBP") which is also the presentation
currency.
2.3 Basis of consolidation
Subsidiaries
Subsidiaries are entities controlled by the Group. The Group
'controls' an entity when it is exposed to, or has rights to,
variable returns from its involvement with the entity and has the
ability to affect those returns through its power over the entity.
The financial statements of subsidiaries are included in the
consolidated financial statements from the date on which control
commences until the date on which control ceases.
Changes in the Group's interest in a subsidiary that do not
result in a loss of control are accounted for as equity
transactions.
Transactions eliminated on consolidation
Intra-group balances and transactions, and any unrealised income
and expenses arising from intra-group transactions, are
eliminated.
A list of the significant investments in subsidiaries, including
the name, country of incorporation and proportion of ownership
interest is given in note 29 to the Company's separate financial
statements.
2.4 Application of New and Revised IFRS's
In the current year, the Group has applied a number of other
amendments to Standards and Interpretations issued by the IASB that
are effective for an annual period that begins on or after 1
January 2021. This has not had any material impact on the amounts
reported for the current and prior years. These include:
Effective
Date
IFRS 9, IBOR (Inter-Bank Offered Rates) Reforms Phase 1 January
IAS 39 2 2021
& IFRS
7
At the date of authorisation of these financial statements the
following Standards and Interpretations which have not been applied
in these financial statements were in issue but not yet effective
and are not expected to have a material impact on the Group:
Effective
Date
IFRS 3 Amendments References to the Conceptual Framework 1 January
in IFRS standards. 2022
IAS 16 Amendments prohibiting a company from deducting 1 January
from the cost of property, plant and equipment 2022
amounts received from selling items produced
while the company is preparing the asset for
its intended use.
IAS 37 Amendments regarding the costs to include 1 January
when assessing whether a contract is onerous. 2022
IFRS 1, Annual Improvements to IFRS Standards 2018-2020 1 January
IFRS 9, (Amendments). 2022
IFRS 16
and IAS
41
Effective
Date
IAS 1 Amendments regarding the disclosure of accounting 1 January
& IAS policies and amendments regarding the definition 2023
8 of accounting estimates.
IAS 12 Amendments to deferred Tax Related to Assets 1 January
and Liabilities arising from a Single Transaction. 2023
2.5 Segment reporting
Operating segments are reported in a manner consistent with the
internal reporting provided to the chief operating decision-maker.
The chief operating decision-maker, who is responsible for
allocating resources and assessing performance of the operating
segments, has been identified as the executive directors that make
strategic decisions. Whilst the Group trading has numerous
components, the chief operating decision maker (CODM) is of the
opinion that there is only one operating segment. This is in line
with internal reporting provided to the executive directors.
2.6 Going concern
The directors pay careful attention to the cost base of the
Group ensuring not only that it is kept at a level to satisfy the
commercial requirements but also that it remains appropriate to the
level of activity of the Group and the financial resources
available to it.
The COVID-19 pandemic has been unprecedented in scale and impact
and the directors have taken swift and decisive action to protect
customers, colleagues, franchisees, and the communities in which
the Group operates, by implementing the necessary steps to
safeguard business through the crisis, in line with UK Government
guidelines.
The current cash balance has increased by GBP0.2m to GBP6.8m,
the Group continues to be cash generative.
Based on the current working capital forecast, there is no need
to raise additional funds as the Group considers that they are in a
position where the scenario of not meeting liabilities is remote.
After making enquiries and considering the assumptions upon which
the forecasts have been based, the directors have a reasonable
expectation that the Group has adequate resources to continue in
operational existence for the period of at least twelve months from
the date of approval of these financial statements. For these
reasons, they continue to adopt the going concern basis of
accounting in preparing the annual financial statements.
2.7 Revenue recognition
The Group recognises revenue from the following major
sources:
-- Sale of sponges, fresh cream and other goods to franchisees
-- Online sales of cakes and related products to customers;
-- Franchise package
Sale of sponges and related ingredients to franchisees
For sales of goods to franchisees, revenue is recognised when
control of the goods has transferred, being at the point at which
the goods are dispatched. Payment of the transaction price is due
within 14 days after delivery. The Group actively works with its
franchisees to ensure credit terms are met and if terms are
required to be extended a suitable debt recovery plan is agreed. It
is considered highly unlikely that an impairment would ever be
required.
Online sales of cakes and related products to customers
Online sales which include click and collect sales where the
franchisee has the primary responsibility for the fulfillment of
the order and the Group is collecting consideration on behalf of
the franchisee as agent are not recognised as revenue of the Group.
Only the net commission amount is recognised. Revenue is recognised
at the date of order and payment is taken at this point.
Franchise package
The franchise package consists of up-front revenues which relate
to pre and post-opening costs mainly for store fit-out; and initial
set up costs to cover site selection,pre opening support, and
franchisee and staff training Each part is considered distinct.
The pre and post-opening costs are required to get the new
franchisee trading and are therefore recognised at a point in time
which is at the end of the month in which trading commenced. Each
package is tailored to a specific franchisee's needs and elements
can be added or removed as appropriate which will affect the price.
Each element carries its own price.
2.8 Current and deferred taxation
Current tax liabilities
Current tax for the current and prior periods is, to the extent
unpaid, recognised as a liability. If the amount already paid in
respect of the current and prior periods exceeds the amount due for
those periods, the excess is recognised as an asset, limited to the
extent that it is probable that taxable profits will be available
against which those deductible temporary differences can be
utilised.
A provision is recognised for those matters for which the tax
determination is uncertain, but it is considered probable that
there will be a future outflow of funds to a tax authority. The
provisions are measured at the best estimate of the amount expected
to become payable.
No material uncertain tax positions exist as at 31 March 2022.
This assessment relies on estimates and assumptions and may involve
a series of complex judgments about future events. To the extent
that the final tax outcome of these matters is different than the
amounts recorded, such differences will impact income tax expense
in the period in which such determination is made.
Current taxes are calculated using tax rates and laws that are
enacted or substantively enacted at the reporting date.
Deferred Tax
Deferred tax is recognised on differences between the carrying
amounts of assets and liabilities in the financial statements and
their corresponding tax bases (known as temporary differences).
Deferred tax liabilities are recognised for all temporary
differences that are expected to increase taxable profit in the
future. Deferred tax assets are recognised for all temporary
differences that are expected to reduce taxable profit in the
future, and any unused tax losses or unused tax credits, limited to
the extent that it is probable that taxable profits will be
available against which those deductible temporary differences can
be utilised.
The net carrying amount of deferred tax assets is reviewed at
each reporting date and is adjusted to reflect the current
assessment of future taxable profits. Deferred tax is calculated at
the tax rates that are expected to apply to the taxable profit (tax
loss) of the periods in which it expects the deferred tax asset to
be realised or the deferred tax liability to be settled.
Deferred taxes are calculated using tax rates and laws that are
enacted or substantively enacted at the reporting date that are
expected to apply as or when the temporary differences
reverses.
Tax Expense
Income tax expense represents the sum of the tax currently
payable and deferred tax movement for the current period. The tax
currently payable is based on taxable profit for the year.
Income taxes are recognised in profit or loss unless they relate
to items recognised in other comprehensive income or equity, in
which case the income tax is recognised in other comprehensive
income or equity respectively.
2.9 Tangible fixed assets - held at cost
Property, plant and equipment, other than investment and
freehold properties, are stated at historical cost less accumulated
depreciation and any accumulated impairment losses. Historical cost
includes expenditure that is directly attributable to bringing the
asset to the location and condition necessary for it to be capable
of operating in the manner intended by management.
Land is not depreciated. Depreciation on other assets is charged
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 annual basis:
Freehold property & improvements - Over 4 to 50 years
Plant & machinery - 25% Straight-line
method
Motor vehicles - 25% Straight-line
method
Fixtures & fittings - 25% Straight-line
method
Assets under construction - Not depreciated
Assets under the course of construction are carried at cost less
any recognised impairment loss. Depreciation of these assets
commences when the assets are ready for their intended use.
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 the profit
or loss.
2.10 Tangible fixed assets - held at valuation
Individual freehold properties are carried at fair value at the
date of the revaluation less any subsequent accumulated impairment
losses. Revaluations are undertaken with sufficient regularity to
ensure the carrying amount does not differ materially from that
which would be determined using fair value at each Consolidated
Statement of Financial Position date.
Fair values are determined by an independent valuer and updated
by the directors from market-based evidence.
Revaluation gains and losses are recognised in Other
Comprehensive Income unless losses exceed the previously recognised
gains or reflect a clear consumption of economic benefits, in which
case the excess losses are recognised in the profit or loss.
2.11 Inventories
Inventories are stated at the lower of cost and net realisable
value, being the estimated selling price less costs to complete and
sell. Cost is based on the cost of purchase on a first in, first
out basis.
2.12 Financial instruments
Recognition of Financial Instruments
Financial assets and financial liabilities are recognised when
the Group becomes party to the contractual provisions of the
instrument.
Trade and other receivables
Trade and other receivables without a significant financing
component are initially measured at transaction price. All sales
are made on the basis of normal credit terms, and the receivables
do not bear interest. Where credit is extended beyond normal credit
terms, receivables are measured at amortised cost using the
effective interest method. At the end of each reporting period, the
carrying amounts of trade and other receivables are reviewed.
Impairment provisions for current and non-current 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 within cost of sales in the Consolidated
Statement of Comprehensive Income. On confirmation that the trade
receivable will not be collectable, the gross carrying value of the
asset is written off against the associated provision.
Other financial assets - Loans to franchisees
Other financial assets are initially measured at fair value and
subsequently at amortised cost. At the end of each reporting
period, the carrying amounts of other financial assets are reviewed
on an individual balance basis and appropriate impairments is made
if required.
Trade and other payables
Trade and other payables are initially measured at fair value
and subsequently at amortised cost. Trade payables are obligations
on the basis of normal credit terms and do not bear interest. Trade
payables denominated in a foreign currency are translated into
Sterling using the exchange rate at the reporting date. Foreign
exchange gains or losses are included in other income or other
expenses.
Bank loans and overdrafts
All borrowings are initially recorded at fair value, net of
transaction costs. Borrowings are subsequently carried at amortised
cost under the effective interest method.
Borrowings are classified as current liabilities unless the
Group has an unconditional right to defer settlement of the
liability for at least 12 months after the reporting date.
2.14 Finance costs
Finance costs are charged to the Consolidated Statement of
Comprehensive Income over the term of the debt using the effective
interest method so that the amount charged is at a constant rate on
the carrying amount. Issue costs are initially recognised as a
reduction in the proceeds of the associated capital instrument.
2.15 Cash and cash equivalents
Cash and cash equivalents comprise cash on hand and deposits
with maturities of three months or less from inception, and other
short-term highly liquid investments that are readily convertible
to a known amount of cash and are subject to an insignificant risk
of changes in value.
2.16 Dividends
Equity dividends are recognised when they become legally
payable. Interim equity dividends are recognised when paid. Final
equity dividends are recognised when approved by the shareholders
at an Annual General Meeting.
2.17 Leases
The Group assesses whether a contract is, or contains, a lease,
at inception of the contract. The Group recognises a right-of-use
asset and a corresponding lease liability with respect to all lease
arrangements in which it is the lessee, except for short-term
leases (defined as leases with a lease term of 12 months or less)
and leases of low value assets (such as tablets and personal
computers, small items of office furniture and telephones). For
these leases, the Group recognises the lease payments as an
operating expense on a straight-line basis over the term of the
lease unless another systematic basis is more representative of the
time pattern in which economic benefits from the leased assets are
consumed.
The lease liability is initially measured at the present value
of the lease payments that are not paid at the commencement date,
discounted by using the rate implicit in the lease.
Lease payments included in the measurement of the lease
liability comprise:
-- Fixed lease payments (including in-substance fixed payments),
less any lease incentives receivable;
-- Variable lease payments that depend on an index or rate,
initially measured using the index or rate at the commencement
date;
-- The amount expected to be payable by the lessee under residual value guarantees;
-- The exercise price of purchase options if the lessee is
reasonably certain to exercise the options;
-- Payments of penalties for terminating the lease, if the lease
term reflects the exercise of an option to terminate the lease
The lease liability is presented as a separate line in the
Consolidated Statement of Financial Position.
The lease liability is subsequently measured by increasing the
carrying amount to reflect interest on the lease
liability (at a constant rate) and by reducing the carrying
amount to reflect the lease payments made.
The Group remeasures the lease liability (and makes a
corresponding adjustment to the related right-of-use asset)
whenever:
-- The lease term has changed or there is a significant event or
change in circumstances resulting in a change in the assessment of
exercise of a purchase option, in which case the lease liability is
remeasured by discounting the revised lease payments using a
revised discount rate;
-- The lease payments change due to changes in an index or rate
or a change in expected payment under a guaranteed residual value,
in which cases the lease liability is remeasured by discounting the
revised lease payments using a revised discount rate (unless the
lease payments change is due to a change in a floating interest
rate, in which case a revised discount rate is used);
-- A lease contract is modified, and the lease modification is
not accounted for as a separate lease, in which case the lease
liability is remeasured based on the lease term of the modified
lease by discounting the revised lease payments using a revised
discount rate at the effective date of the modification.
The Group did not make any such adjustments during the periods
presented.
The right-of-use assets comprise the initial measurement of the
corresponding lease liability, lease payments
made at or before the commencement day, less any lease
incentives received and any initial direct costs. They are
subsequently measured at cost less accumulated depreciation and
impairment losses.
Whenever the Group incurs an obligation for costs to dismantle
and remove a leased asset, restore the site on which it is located
or restore the underlying asset to the condition required by the
terms and conditions of the lease, a provision is recognised and
measured under IAS 37. To the extent that the costs relate to a
right-of-use asset, the costs are included in the related
right-of-use asset, unless those costs are incurred to produce
inventories.
Right-of-use assets are depreciated over the shorter period of
lease term and useful life of the right-of-use asset. If a lease
transfers ownership of the underlying asset or the cost of the
right-of-use asset reflects that the Group expects to exercise a
purchase option, the related right-of-use asset is depreciated over
the useful life of the underlying asset. The depreciation starts at
the commencement date of the lease.
The right-of-use assets are presented as a separate line in the
consolidated statement of financial position. The Group applies IAS
36 to determine whether a right-of-use asset is impaired and
accounts for any identified impairment loss as described in the
'Property, Plant and Equipment' policy.
2.18 Employee benefits
Short Term Employee Benefits
The cost of short-term employee benefits, (those payable within
12 months after the service is rendered, such as leave pay and sick
leave, bonuses, and non-monetary benefits such as medical care),
are recognised in the period in which the service is rendered and
are not discounted.
Defined contribution pension plan
The Group operates a defined contribution plan for its
employees. A defined contribution plan is a pension plan under
which the Group pays fixed contributions into a separate entity.
Once the contributions have been paid the Group has no further
payment obligations.
The contributions are recognised as an expense in the profit or
loss when they fall due. Amounts not paid are shown in accruals as
a liability in the Consolidated Statement of Financial Position.
The assets of the plan are held separately from the Group in
independently administered funds.
Termination benefits
The entity recognises the expense and corresponding liability
for termination benefits when it is demonstrably committed to
either of the following scenarios:
a. The termination of the employment of an employee or group of
employees before the normal retirement age, or
b. The provision of termination benefits in relation to an offer
made to encourage voluntary redundancy.
The value of such benefit is measured at the best estimate of
the expenditure required to settle the obligation at the reporting
date.
2.19 Provisions and contingencies
Provisions are recognised when the Group has an obligation at
the reporting date as a result of a past event; it is probable that
the Group will be required to transfer economic benefits in
settlement; and the amount of the obligation can be estimated
reliably.
Provisions are measured at the present value of the amount
expected to be required to settle the obligation using a pre-tax
rate that reflects current market assessments of the time value of
money and the risks to a specific obligation. The increase in the
provision due to the passage of time is recognised as interest
expense.
Provisions are not recognised for future operating losses.
Contingent assets and contingent liabilities are not
recognised.
2.20 Share capital
Ordinary shares are classified as equity. Equity instruments are
measured at the fair value of the cash or other resources received
or receivable, net of the direct costs of issuing the equity
instruments. If payment is deferred and the time value of money is
material, the initial measurement is on a present value basis.
2.21 Research and development
Research and development expenditure is charged to the
Consolidated Statement of Comprehensive Income in the year in which
it is incurred. The expenditure does not meet the definition of
'Development' under IAS 38.
2.22 Fair value measurement
When an asset or liability, financial or non-financial, is
measured at fair value for recognition or disclosure purposes, the
fair value is based on the price that would be received to sell an
asset or paid to transfer a liability in an orderly transaction
between market participants at the measurement date; and assumes
that the transaction will take place either: in the principal
market; or in the absence of a principal market, in the most
advantageous market.
Fair value is measured using the assumptions that market
participants would use when pricing the asset or liability,
assuming they act in their economic best interests. For
non-financial assets, the fair value measurement is based on its
highest and best use. Valuation techniques that are appropriate in
the circumstances and for which sufficient data are available to
measure fair value, are used, maximising the use of relevant
observable inputs and minimising the use of unobservable
inputs.
Assets and liabilities measured at fair value are classified
into three levels, using a fair value hierarchy that reflects the
significance of the inputs used in making the measurements.
Classifications are reviewed at each reporting date and transfers
between levels are determined based on a reassessment of the lowest
level of input that is significant to the fair value
measurement.
For recurring and non-recurring fair value measurements,
external valuers may be used when internal expertise is either not
available or when the valuation is deemed to be significant.
External valuers are selected based on market knowledge and
reputation. Where there is a significant change in fair value of an
asset or liability from one period to another, an analysis is
undertaken, which includes a verification of the major inputs
applied in the latest valuation and a comparison, where applicable,
with external sources of data.
2.23 Share based payment
Where share options are awarded to employees, the fair value of
the options (measured using the Black-Scholes model) at the date of
grant is charged to the Statement of Comprehensive Income over the
vesting period. Non-market vesting conditions are considered by
adjusting the number of equity instruments expected to vest at each
reporting date so that, ultimately, the cumulative amount
recognised over the vesting period is based on the number of
options that eventually vest. Market vesting conditions are
factored into the fair value of the options granted. The cumulative
expense is not adjusted for failure to achieve a market vesting
condition.
The fair value of the award also considers non-vesting
conditions. These are either factors beyond the control of either
party or factors which are within the control of one or another of
the parties. Where the terms and conditions of options are modified
before they vest, the increase in the fair value of the options,
measured immediately before and after the modification, is also
charged to profit or loss over the remaining vesting period.
Lapsed share options are derecognised as soon as it known that
vesting conditions will not be met. Previous charges to the
Statement of Comprehensive Income are credited back to this
statement.
2.24 Exceptional items
Exceptional items are transactions that fall within the ordinary
activities of the Group but are presented separately due to their
size or incidence.
3. Segment reporting
Components reported to the chief operating decision maker (CODM)
are not separately identifiable and as such consider there to be
one reporting segment. The Group makes varied sales to its
customers but none are a separately identifiable component. The
following information is disclosed:
2022 2021
GBP GBP
Sales of sponge 12,301,051 8,199,509
Sales of food 5,479,076 3,542,798
Sales of fresh cream 3,442,619 2,419,431
Sales of other goods 7,023,665 4,581,678
Online sales commission 937,640 470,499
Franchise packages 3,780,795 2,696,947
32,964,846 21,910,862
========== ==========
All revenue occurred in the United Kingdom for both financial
years.
The operating segment information is the same information as
provided throughout the consolidated financial statements and is
therefore not duplicated.
The Group was not reliant upon any major customer during 2022 or
2021.
4. Expenses by nature
The Administrative expenses have been arrived at after
charging/(crediting):
2022 2021
GBP GBP
Wages and salaries 5,302,849 3,702,499
Travel and entertaining costs 372,303 210,587
Supplies costs 293,620 233,258
Professional costs 839,897 538,533
Depreciation 853,633 670,333
Amortisation of right-of-use assets 124,975 -
Rates and utilities costs 307,200 294,292
Property maintenance costs 338,817 193,607
Advertising costs 312,907 317,154
Other costs 48,212 38,718
Exceptional items (see note 10) (781,965) 486,319
8,012,448 6,685,300
========= =========
5. Operating profit
The operating profit is stated after charging/(crediting):
As restated
2022 2021
GBP GBP
Depreciation of tangible fixed assets 853,633 670,333
Amortisation of right-of-use asset 124,975 -
Stock recognised as an expense 17,133,685 10,978,933
Profit on disposal of property, plant & equipment (13,154) (18,972)
Research and development charged as an expense - 215,555
Fees payable to the Group's auditor and its
associates for the audit of the Group's annual
financial statements 75,000 87,000
Fees payable to the Group's auditor and its
associates for the audit of the Group's interim
financial statements - 7,500
Share based payment (credit)/expense (486,368) 288,000
The comparative figure for 'Stock recognised as an expense' has
been corrected to represent the true value.
6. Net finance costs
2022 2021
Finance expenses GBP GBP
Bank loan interest 33,971 35,771
Finance lease interest 46,228 -
Interest on overdue tax 2,991 5,615
Finance income
Bank interest receivable (1,802) (4,087)
81,388 37,299
======= =======
7. Staff costs
Staff costs, including directors' remuneration, were as
follows:
2022 2021
GBP GBP
Wages and salaries 4,737,683 3,055,008
Social security costs 456,259 287,875
Pension costs 56,798 42,080
Private health 52,109 29,536
Share-based payment expense - 288,000
--------- ---------
5,302,849 3,702,499
Reversal of share-based payment expense (note
10) (486,368) -
4,816,481 3,702,499
========= =========
The average monthly number of employees, including directors,
for the year was 155 (FY21 - 107). The breakdown by department is
as follows;
2022 2021
GBP GBP
Directors 7 7
Admin 31 24
Maintenance 17 11
Production & Logistics 100 65
155 107
=================== ===================
8. Dividends
2022 2021
GBP GBP
Interim dividend of 1.85 per ordinary share - 740,000
Final dividend of 3.2p per ordinary share proposed
and paid during the year relating to the previous
year's results - 1,280,000
Interim dividend of 2.5 per ordinary share 1,000,000 -
Final dividend of 3.7p per ordinary share proposed
and paid during the year relating to the previous
year's results 1,480,000 -
2,480,000 2,020,000
=================== ===================
Since the year end the Directors recommend payment of a dividend
of 5.1 pence (FY21 - 3.7 pence) per share totalling GBP2,040,000
(2021 - GBP1,480,000) for the year ended 31 March 2022.
During the end-of-year audit process, the Board became aware of
an issue concerning technical compliance with the Companies Act
2006 in relation to past dividend payments. Although there were
sufficient distributable reserves and cash held in the Group which
could have been distributed, dividends were declared at a time when
the Group's holding company itself, Cake Box Holdings plc, did not
hold adequate distributable reserves by reference to its last set
of annual accounts. The Group's historic reported trading results
and financial condition are entirely unaffected.
The Board proposes to put resolutions to Shareholders at the
time of the 2022 Annual General Meeting to address this past
issue.
9. Directors' remuneration and key management personnel
The Directors' remuneration is disclosed within the Directors'
Remuneration Report in the Group's Annual Report & Accounts.
The Executive Directors are considered key management personnel.
Employers NIC paid on Directors' remuneration in the year was
GBP114,388 (FY21 - GBP62,287).
10. Exceptional items
2022 2021
GBP GBP
Website data breach (note 23) - 486,319
Lapse of share options (note 20) (486,368) -
Reversal of accrued rates (295,597) -
(781,965) 486,319
========= =======
Rates and utilities costs includes a credit of GBP295,597
related to an accrual raised in a previous year, which has been
released on the basis the directors have received confirmation it
is no longer required. Please see relevant notes for further
information on the website data breach and lapse of share
options.
11. Taxation
2022 2021
GBP GBP
Corporation tax
Current tax on profits for the year 1,340,469 900,406
Adjustments in respect of previous periods (838) 1,536
Deferred tax
Arising from origination and reversal of
temporary differences 86,078 (59,580)
Taxation on profit on ordinary activities 1,425,709 842,362
========== ==========
Factors affecting tax charge for the year
The tax assessed for the year is lower than (FY21 - higher than)
the standard rate of corporation tax in the UK of 19% (FY21 -
19%). The differences are explained below:
2022 2021
GBP GBP
Profit on ordinary activities before tax 7,737,325 4,209,270
Profit on ordinary activities multiplied
by standard rate of corporation tax in
the UK of 19% (FY21 - 19%) 1,470,092 799,761
Effects of:
Expenses not deductible for tax purposes,
other than goodwill amortisation and impairment 11,700 95,115
Income not taxable (22,267) -
Deferred tax not provided 22 -
Use of super deduction allowance (33,808) -
Adjustment in research and development
tax credit leading to a decrease in the
tax charge - (53,242)
Difference in tax rates used within share-based
payments 808 (808)
Adjustments to tax charge in respect of
prior periods (838) 1,536
Total tax charge for the year 1,425,709 842,362
========== ==========
Factors that may affect future tax charge
At the Budget 2021 on 3 March 2021, the Government announced
that the Corporation Tax rate will increase to 25% for companies
with profits above GBP250,000 with effect from 1 April 2023, as
well as announcing a number of other changes to allowances and
treatment of losses.
12. Deferred taxation
As restated
2022 2021
GBP GBP
Balance brought forward 675,227 494,805
Charged to other comprehensive income:
Deferred tax on revalued freehold property 237,533 242,231
Charged directly to reserves:
Employee benefits (including share-based payments) 2,228 (2,228)
Charged to profit and loss:
Accelerated capital allowances (7,557) (3,715)
Share -based payments 93,219 (55,529)
Other short-term timing differences (1,820) (337)
Balance carried forward 998,830 675,227
======= ===========
2022 2021
GBP GBP
Deferred tax liabilities
Accelerated capital allowances 189,704 197,261
Other short-term timing differences (3,571) (1,751)
Property revaluations (including indexation) 812,697 575,164
------- --------
998,830 770,674
Deferred tax assets
Employee benefits (including share-based payments) - (95,447)
998,830 675,227
======= ========
Movements in deferred tax in direct relation to freehold
property revaluation are recognised immediately against the
revaluation reserve.
See note 20 for more information for restated comparatives.
13. Property, plant and equipment
As restated
Assets Freehold
under construction property Plant & Motor Fixtures
& Improvements machinery vehicles & fittings Total
GBP GBP GBP GBP GBP GBP
Cost or valuation
At 1 April
2020 1,038,177 4,786,703 985,449 601,030 1,657,638 9,068,997
Additions 82,396 115,206 88,295 146,005 273,057 704,959
Disposals - - - (44,165) - (44,165)
Revaluations - 1,274,901* - - - 1,274,901
At 31 March
2021 1,120,573 6,176,810 1,073,744 702,870 1,930,695 11,004,692
-------------------- ---------------- ----------- ---------- ------------ -----------
Depreciation
At 1 April
2020 - 70,539 648,033 303,263 847,613 1,869,448
Charge for
the year - 116,704 138,766 132,471 282,392 670,333
Disposals - - - (36,691) - (36,691)
At 31 March
2021 - 187,243 786,799 399,043 1,130,005 2,503,090
-------------------- ---------------- ----------- ---------- ------------ -----------
Net book value
-------------------- ---------------- ----------- ---------- ------------ -----------
At 31 March
2021 1,120,573 5,989,567 286,945 303,827 800,690 8,501,602
==================== ================ =========== ========== ============ ===========
Assets Freehold
under construction property Plant & Motor Fixtures
& Improvements machinery vehicles & fittings Total
GBP GBP GBP GBP GBP GBP
Cost or valuation
At 1 April
2021 1,120,573 6,176,810 1,073,744 702,870 1,930,695 11,004,692
Additions - 555,446 107,697 373,516 97,267 1,133,926
Disposals - - - (43,910) - (43,910)
Transfers between
classes (1,120,573) 1,120,573 - - - -
Revaluations - 1,250,175 - - - 1,250,175
At 31 March
2022 - 9,103,004 1,181,441 1,032,476 2,027,962 13,344,883
-------------------- ---------------- ----------- ---------- ------------ -----------
Depreciation
At 1 April
2021 - 187,243 786,799 399,043 1,130,005 2,503,090
Charge for
the year - 236,353 84,866 180,840 351,574 853,633
Disposals - - - (41,049) - (41,049)
At 31 March
2022 - 423,596 871,665 538,834 1,481,579 3,315,674
-------------------- ---------------- ----------- ---------- ------------ -----------
Net book value
-------------------- ---------------- ----------- ---------- ------------ -----------
At 31 March
2022 - 8,679,408 309,776 493,642 546,383 10,029,209
==================== ================ =========== ========== ============ ===========
Assets under construction became operational during the
year.
* During the year the Directors expanded the freehold property
column in the fixed assets note to include property improvement
costs which were previously included in fixtures and fittings in
order to provide more clarity. This included a revaluation of
freehold properties as detailed in note 20. Prior year comparatives
have been restated.
As at 31 March 2022, all freehold property was valued by
independent 3rd party qualified valuers, in accordance with the
RICS Valuation - Global Standards 2017 (the Red Book). The
directors believe these valuations to be representative of the fair
value as at the balance sheet date.
The fair value of freehold property is categorised as a level 3
recurring fair value measurement.
The following table summarises the quantitative information
about the significant unobservable inputs used in recurring level 3
fair value measurements:
Fair value
at 31 March Valuation
Property 2022 GBP technique Sq ft Rate per sq ft
Min Max Average
Enfield 7,000,000 Vacant possession 39,121 125 250 179
Coventry 1,080,000 Vacant possession 13,000 83
Bradford 525,000 Vacant possession 9,358 56
Improvements
at Mollison 74,408 Net book value n/a n/a n/a n/a
Total 8,679,408
-------------- ------------------------- ------------------ ------- ---- ---- --------
If the Freehold properties had been accounted for under the historic
cost accounting rules, the properties would have been measured
as follows:
2022 2021
GBP GBP
Historic cost 3,433,746 2,442,744
==================== ===================
14. Leases
The Consolidated Statement of Financial Position shows the
following amounts in relation to leases:
Properties
GBP
Cost
At 1 April -
2021
Additions 2,999,405
At 31 March
2022 2,999,405
-----------
Depreciation
At 1 April -
2021
Charge for
the year 124,975
At 31 March
2022 124,975
-----------
Net book value
-----------
At 31 March
2022 2,874,430
===========
Additions relate to the lease of a new property undertaken in
the year.
The group leases one property and the term is ten years. There
are no variable lease payments or commitment to short term
leases.
Lease liabilities 2022 2021
GBP GBP
Current 260,191 -
Non-current 2,699,958 -
2,960,149 -
========================= =================
The Group's obligations are secured by the lessor's title to the
leased assets for such leases.
Amounts recognised in the Consolidated Statement of
Comprehensive Income are as follows:
2022 2021
GBP GBP
Depreciation expense of right-of-use assets 124,975 -
Interest expense on lease liabilities 46,228 -
================ =================
The total cash outflow for leases amount to GBP85,483 (FY21 -
GBPNil).
15. Inventories
2022 2021
GBP GBP
Finished goods and goods
for resale 2,468,921 1,902,171
========== ==========
Inventories are charged to cost of sales in the Consolidated
Statement of Comprehensive Income.
16. Trade and other receivables
2022 2021
GBP GBP
Trade receivables 2002,807 2,041,673
Other receivables 280,613 17,147
Prepayments 269,789 431,397
2,553,209 2,490,217
========== =========================
Current 2,553,209 2,490,217
2,553,209 2,490,217
========== =========================
The fair value of those trade and other receivables classified
as financial assets at amortised cost are disclosed in the
financial instruments (note 26).
The Group's exposure to credit and market risks, including
impairments and allowances for credit losses, relating to trade and
other receivables is disclosed in the financial risk management and
impairment of financial assets note(note 27).
17. Other financial assets
2022 2021
GBP GBP
Loans to franchisees 1,067,607 1,038,812
1,067,607 1,038,812
==========
Non-current 710,059 656,004
Current 357,548 382,808
1,067,607 1,038,812
==========
Loans are interest free and payable in equal monthly
instalments. All non-current assets are due within five years of
the statement of financial position date. The carrying amount of
the loans is considered to be equal to their fair value.
18. Share capital
2022 2021
GBP GBP
40,000,000 Ordinary shares of GBP0.01
each 400,000 400,000
======== ========
All of the ordinary shares of GBP0.01 each carry voting rights,
the right to participate in dividends, and entitle the shareholders
to a pro-rata share of assets on a winding up.
19. Reserves
The following describes the nature and purpose of each reserve
within equity:
Capital redemption reserve
Amounts transferred from share capital on redemption of issued
shares.
Revaluation reserve
Gain/(losses) arising on the revaluation of the Group's property
(other than investment property).
Retained earnings
All other net gains and losses and transactions with owners
(e.g., dividends, fair value movements of investment property) not
recognised elsewhere.
Share option reserve
Gains/losses arising on amounts in respect of equity-settled
share options outstanding. See note 21 for more information.
20. Prior Period Adjustment
During the year it was discovered that an uplift in fair value
of freehold properties was not properly reflected in the financial
statements in the prior year. This has been corrected in the
financial statements.
The following financial statements were affected as a
result:
Extract of Consolidated Statement of Comprehensive Income
Adjustment
As previously to fair value
reported of properties Restated
Profit after income tax 3,366,908 - 3,366,908
Other comprehensive income
for the year
Revaluation of freehold property 24,901 1,250,000 1,274,901
Deferred tax on revaluation
of freehold property (4,731) (237,500) (242,231)
-------------- --------------- ----------
Total other comprehensive income
for the year 20,170 1,012,500 1,032,670
Total comprehensive income
for the year 3,387,078 1,012,500 4,399,578
============== =============== ==========
Extract of Consolidated Statement of Financial Position
Adjustment
As previously to fair value
reported of properties Restated
Property, plant and equipment 7,251,602 1,250,000 8,501,602
-------------- --------------- -----------
Total Assets 8,003,053 1,250,000 9,253,053
============== =============== ===========
Revaluation reserve 1,609,592 1,012,500 2,622,092
-------------- --------------- -----------
Equity Attributable to the
owners of the Parent Company 1,609,592 1,012,500 2,622,092
============== =============== ===========
Deferred tax liabilities 533,174 237,500 770,674
-------------- --------------- -----------
Total Equity and Liabilities 17,904,113 237,500 19,154,113
============== =============== ===========
There is no impact on the Group's basic or diluted earnings per
share and no impact on the total operating, investing or financing
cash flows for the years ended 31 March 2021 or 2022.
21. Share-Based Payments
The Group operates two equity-settled share-based remuneration
schemes for certain employees at management and executive director
level: A United Kingdom tax authority approved scheme for senior
managers and an executive director and an unapproved scheme for
executive directors. The main vesting condition for senior managers
is aggregated EBITDA reaching GBP19 million by the third
anniversary of the date of the grant. The main vesting condition
for the executive director is aggregated Earnings Per Share
reaching a minimum of 36.41p by the third anniversary of the date
of the grant on which 30% will be exercisable. This increases by
0.0963% for every penny over the minimum level. The individuals
must remain employees of the Group over the 3 or 4 year period.
Under the unapproved scheme, options vest on the same basis as the
approved scheme for the executive director. In addition, the
options will lapse 10 years after the grant date.
2022 2022 2021 2021
Weighted
average Weighted
exercise average
price exercise
(pence) Number price (pence) Number
Outstanding as at 1 April 64 688,400 64 688,400
Lapsed during the year (64) (688,400) - -
Outstanding as at 31 March - - 64 688,400
========== =======================
No share options were granted, forfeited, or exercised during
current or prior year. The share options lapsed during the year as
the vesting conditions were not met.
22. Borrowings
2022 2021
GBP GBP
Non-current borrowings
Bank loans 1,185,978 1,318,005
1,185,978 1,318,005
========== =========================
Current borrowings
Bank loans 167,754 167,754
167,754 167,754
========== =========================
Bank loans have fixed charges over the properties to which they
relate and interest of 2.15% - 2.23% above Bank of England base
rate are charged on the loans. The loans are repayable in monthly
instalments with final payments due between March 2024 and November
2025.
23. Trade and other payables
2022 2021
GBP GBP
Trade payables 1,994,411 2,495,741
Other taxation and social
security 340,035 242,473
Other payables 36,497 21,099
Accruals 290,429 594,436
2,661,372 3,353,749
========== =========================
The fair value of the trade and other payables classified as
financial instruments are disclosed in the financial instruments
(note 27).
The Group's exposure to market and liquidity risks related to
trade and other payables is disclosed in the financial risk
management and impairment of financial assets note. The Group pays
its trade payables on terms and as such trade payables are not yet
due at the statement of financial position dates.
24. Provisions
2022 2021
GBP GBP
Website data breach 243,100 486,319
======== ========
The provision represents a website data breach in 2020. The
amount remaining represents potential fines in respect of the
website data breach and is based upon independent legal advice.
Website data
breach
GBP
Carrying amount at the start
of the year 486,319
Reversed during the year (243,219)
Carrying amounts at the end
of the year 243,100
=============
25. Pension commitments
The Group operates a defined contributions pension scheme. The
assets of the scheme are held separately from those of the Group in
an independently administered fund. The pension cost charge
represents contributions payable by the Group to the fund and
amounted to GBP56,798 (FY21 - GBP42,080). Contributions totalling
GBP19,890 (FY21 - GBP10,089) were payable to the fund at the
statement of financial position date and are included in other
payables (see note 23).
26. Related party transactions
Transactions between the Company and its subsidiaries, which are
related parties, have been eliminated on consolidation. Related
party transactions are considered to be at arms-length.
Details of amounts paid to key management personnel which
includes executive and non-executive directors are included within
note 9 and the Directors Remuneration Report in the Group's Annual
Report & Accounts.
Key management personnel had an interest in dividends as
follows:
2022 2021
GBP GBP
Sukh Chamdal 792,851 645,790
Pardip Dass 133,995 196,719
Jaswir Singh 34,473 28,079
Neil Sachdev 1,148 935
Alison Green 222 -
----------------------- -----------------------
962,689 871,523
======================= =======================
During the year the Group made sales to companies under the
control of the directors. All sales were made on an arms-length
basis. These are detailed as follows with director shareholding %
shown in brackets:
Mr. Sukh Chamdal 2022 2021
GBP GBP GBP GBP
Sales Balance Sales Balance
Cake Box (Crawley) Limited (0%) 168,684 11,095 111,825 2,639
Cake Box CT Limited (0%) 280,706 19,326 222,752 20,157
Cake Box (Strood) Limited (0%) 157,247 2,241 147,985 3,361
Cake Box (Gravesend) Limited (0%)** - - 123,162 (1,021)
606,637 32,662 605,724 25,136
======== ======== ======== ========
* 100% Owned by Mr. Chamdal's daughter
** This store no longer considered a related party
Mr. Pardip Dass 2022 2021
GBP GBP GBP GBP
Sales Balance Sales Balance
Eggfree Cake Box Barking Limited (30%) 250,382 6,803 242,150 2,840
250,382 6,803 242,150 2,840
======== ======== ======== ========
Dr Jaswir Singh 2022 2021
GBP GBP GBP GBP
Sales Balance Sales Balance
Luton Cake Box Limited
(10%) 419,676 15,544 361,150 7,563
Peterborough Cake Box Limited
(30%) 258,807 5,983 219,363 10,227
Cream Cake Limited (30%) 230,591 12,971 171,051 6,107
MK Cakes Limited (0%)*** 292,202 10,532 218,676 (3,578)
Bedford Cake Box Limited
(0%)*** 199,553 5,436 145,883 1,432
Chaz Cakes Limited (50%) 266,563 6,446 161,371 1,231
Eggless Cake Company (50%) 194,201 9,366 165,623 2,698
1,861,593 66,278 1,443,117 25,680
---------- -------- ---------- --------
*** 100% owned by Dr Singh's son or daughter
27. Financial instruments
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.
The significant accounting policies regarding financial
instruments are disclosed in note 2.
There have been no substantive changes in the Group's exposure
to financial instrument risks, its objectives, policies and
processes for managing those risks or the methods used to measure
them from previous years unless otherwise stated in this (See note
87).
The principal financial instruments used by the Group, from
which financial instrument risk arises, are as follows:
Financial Assets
Held at amortised cost
2022 2021
GBP GBP
Cash and cash equivalents 6,571,558 5,125,864
Trade and other receivables 2,116,254 2,058,820
Other financial assets 1,067,607 1,038,812
9,755,419 8,223,496
---------- -------------------------
Financial Liabilities
Held at amortised cost
2022 2021
GBP GBP
Trade and other payables 2,584,437 3,111,275
Secured Borrowings 1,353,732 1,485,759
3,938,169 4,597,034
---------- -------------------------
28. Financial risk management
The Board has overall responsibility for the determination of
the Group's risk management objectives and policies and, while
retaining ultimate responsibility for them, it has delegated the
authority for designing and operating processes that ensure the
effective implementation of the objectives and policies to the
Group's finance function. The board receives regular reports from
the Chief Financial Officer through which it reviews the
effectiveness of processes put in place and the appropriateness of
the objectives and policies it sets.
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. Further details regarding
these policies are set out below:
Credit risk and impairment
Credit risk arises principally from the Group's trade and other
receivables. It is the risk that the counter party fails to
discharge its obligation in respect of the instrument. The maximum
exposure to credit risk equals the carrying value of these items in
the financial statements as the Group has the power to stop
supplying the customer until payment is received in full.
Definition of default
The loss allowance on all financial assets is measured by
considering the probability of default.
Receivables are considered to be in default when the principal
or any interest is more than 90 days past due, based on an
assessment of past payment practices and the likelihood of such
overdue amounts being recovered.
Determination of credit-impaired financial assets
The Group considers financial assets to be 'credit-impaired'
when the following events, or combinations of several events, have
occurred before the year-end:
-- significant financial difficulty of the counterparty arising
from significant downturns in operating results and/or significant
unavoidable cash requirements when the counterparty has
insufficient finance from internal working capital resources,
external funding and/or group support;
-- a breach of contract, including receipts being more than 240 days past due;
-- it becoming probable that the counterparty will enter bankruptcy or liquidation.
Write-off policy
Receivables are written off by the Company when there is no
reasonable expectation of recovery, such as when the counterparty
is known to be going bankrupt, or into liquidation or
administration. Receivables will also be written off when the
amount is more than 300 days past due and is not covered by
security over the assets of the counterparty or a guarantee.
Impairment of trade receivables and other financial assets
The Group calculates lifetime expected credit losses for trade
receivables and other financial assets using a portfolio approach.
All items are grouped based on the credit terms offered and the
type of product sold. The probability of default is determined at
the year-end based on the aging of the receivables and historical
data about default rates on the same basis. That data is adjusted
if the Group determines that historical data is not reflective of
expected future conditions due changes in the nature of its
customers and how they are affected by external factors such as
economic and market conditions.
In accordance with IFRS 9, the Group performed a year end
impairment exercise to determine whether any write down in amounts
receivable was required, using an expected credit loss model. The
expected loss rate for receivables including other financial assets
is 0% on the basis of the Group's history of bad debt write
offs.
As at 31 March 2022, the total loss allowances against the
Group's financial assets were immaterial and no charge to the
income statement was recognised.
Liquidity risk
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 cash flow projections on a regular basis
which are monitored regularly. The Board will not commit to
material expenditure in respect of its ongoing development
programme prior to being satisfied that sufficient funding is
available to the Group to finance the planned programmes.
The following table sets out the contractual maturities
(representing undiscounted contractual cash-flows) of financial
liabilities:
Borrowings
2022 2021
GBP GBP
Borrowings - Due within one year 167,754 167,754
Borrowings - Due between one to two years 167,754 167,754
Borrowings - Due between two to five years 1,018,224 1,150,251
1,353,732 1,485,759
---------- -------------------------
Right-of-use assets - Due within one year 260,191 -
Right-of-use assets - Due between one to two
years 270,119 -
Right-of-use assets - Due between two to five
years 873,777 -
Right-of-use assets - Due after more than five
years 1,556,062
---------- -------------------------
2,960,149 -
========== =========================
Trade and other payables
2022 2021
GBP GBP
0 to 30 Days 2,049,774 2,364,512
30 to 60 Days 249,613 447,476
60 to 90 Days 17,646 41,348
90 to 120 Days 73,891 40,300
120 Days to 1 year 193,513 217,639
2,584,437 3,111,275
========== =========================
Interest rate risk
The Group is exposed to interest rate risk because entities in
the Group borrow funds at both fixed and floating interest rates.
The risk is managed by the Group by maintaining good relationships
with banks and other lending providers and by ensuring cash
reserves are high enough to cover the debt. Where possible fixed
terms of interest will be sought.
The Group analyses the interest rate exposure on a regular
basis. A sensitivity analysis is performed by applying a simulation
technique to the liabilities that represent major interest-bearing
positions. Various scenarios are run taking into consideration
refinancing, renewal of the existing positions, alternative
financing and hedging. Based on the simulations performed, the
impact on profit or loss and net assets of a 25 basis-point shift
(being the maximum reasonable expectation of changes in interest
rates) would be a change of GBP3,384 (FY21 - GBP3,714).
Capital risk management
The Group considers its capital to comprise its ordinary share
capital and retained profits as its equity capital. In managing its
capital, the Group's primary objective is to provide return for its
equity shareholders through capital growth and future dividend
income. The Group's policy is to seek to maintain a gearing ratio
that balances risks and returns at an acceptable level and also to
maintain a sufficient funding base to enable the Group to meet its
working capital and strategic investment needs. In making decisions
to adjust its capital structure to achieve these aims, either
through new share issues or the issue of debt, the Group considers
not only its short-term position but also its long-term operational
and strategic objectives.
Details of the Group's capital are disclosed in the Consolidated
Statement of Changes in Equity.
There have been no other significant changes to the Group's
management objectives, policies and procedures in the year nor has
there been any change in what the Group considers to be
capital.
Currency risk
The Group is not exposed to any significant currency risk. The
Group manages any currency exposure by retaining a small holding in
US Dollars however all other cash balances are held in
Sterling.
29. Post statement of financial position events
Post year end the directors have recommended dividends of 5.1p
per share (FY21 - 3.7p per share).
30. Subsidiary undertakings
The following were subsidiary undertakings of the Company
included in the Group results:
Country of Class
Name incorporation of shares Holding Principal activity
Eggfree Cake Box Franchisor of specialist
Limited United Kingdom Ordinary 100% cake stores
Chaz Limited United Kingdom Ordinary 100% Property rental company
The above subsidiaries have the same registered office address
as Cake Box Holdings Plc.
31. Notes supporting statement of cashflows
Cash and cash equivalents for the purposes of the statement of
cashflows comprise of:
2022 2021
GBP GBP
Cash at bank available on demand 6,570,739 5,123,796
Cash on hand 819 2,068
6,571,558 5,125,864
========== =========================
There were no significant non-cash transactions from financing
activities (FY21 - none).
Non-cash transactions from financing activities are shown in the
reconciliation of liabilities from financing transactions
below:
Non-current Current Non-current Current Total
lease liabilities lease borrowings borrowings GBP
GBP liabilities GBP GBP
GBP
As at 1 April
2020 - - 1,446,288 167,754 1,614,042
Cash flows
Repayments - - - (167,754) (167,754)
Non-Cash flows:
Interest - - 39,471 - 39,471
Non-current liabilities
becoming current
during the year - - (167,754) 167,754 -
------------------- ------------- ------------ ------------ ----------
As at 31 March
2021 - - 1,318,005 167,754 1,485,759
Cash flows
New leases 2,999,405 - 2,999,405
Repayments (85,484) - - (167,754) (253,238)
Non-Cash flows:
Interest 46,228 - 35,727 - 81,955
Non-current liabilities
becoming current
during the year (260,191) 260,191 (167,754) 167,754 -
As at 31 March
2022 2,699,958 260,191 1,185,978 167,754 4,313,881
=================== ============= ============ ============ ==========
32. Ultimate controlling party
The Group considers there is no ultimate controlling party.
32. Earnings per share
2022 2021
GBP GBP
Profit after tax attributable to the owners
of Cake Box Holdings Plc 6,311,616 3,366,908
========================= =========================
Number Number
Weighted average number of ordinary shares
used in calculating basic earnings per share 40,000,000 40,000,000
========================= =========================
Weighted average number of ordinary shares
used in calculating diluted earnings per
share 40,000,000 40,000,000
========================= =========================
Pence Pence
Basic earnings per share 15.78 8.42
Diluted earnings per share 15.78 8.42
========================= =========================
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END
FR FFFSFRVIRFIF
(END) Dow Jones Newswires
June 27, 2022 02:00 ET (06:00 GMT)
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