The Future
of Service
Ten Lifestyle Group Plc
ANNUAL REPORT AND ACCOUNTS
FOR THE YEAR ENDED 31 AUGUST 2023
Ten’s Growth Engine
Our Mission
Contents
1
Proposition,
profitability
and scale
To become the
world’s most trusted
service platform
Ten partners with global financial institutions and other
premium brands to attract, engage, and retain wealthy and
mass affluent customers.
Millions of members have access to Ten’s services across
lifestyle, travel, dining, entertainment, and retail, underpinned
by an increasingly sophisticated personalisation platform
comprising industry-first, proprietary technology, thousands
of supplier partners, and 25 years of proprietary expertise
delivered from over 20 global service centres.
Overview
IFC Ten’s Growth Engine
01 Our Mission
02 Highlights
Strategic Report
Investment Case
04 Chairman’s Statement
07 Chief Executive’s Statement
11
12 Business Model
14 Strategy in Action
22 Key Performance Indicators
24 Responsible Business
38
Stakeholder Engagement
(S. 172)
40 Risk Management
44 Financial Review
Corporate Governance
50 Governance at a Glance
51
Chairman’s Introduction to
Governance
52 Board of Directors
54
How We Comply with the
QCA Code
Audit and Risk Committee
Report
Remuneration Committee
Report
Nomination Committee
Report
58
60
66
→ Scan to watch video
→ To read more on our business model and
strategy, see pages 12 to 23.
tenlifestylegroup.com/investors
→ Stay up to date on our website,
www.tenlifestylegroup.com
110 Company Statement
of Changes in Equity
111 Company Statement
of Cash Flows
112 Notes to the Company
Financial Statements
114 Corporate Information
TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023
68 Directors’ Report
Financial Statements
70
78
79
77
Independent
Auditor’s Report
Consolidated Statement
of Comprehensive Income
Consolidated Statement
of Financial Position
Consolidated Statement
of Changes in Equity
Consolidated Statement
of Cash Flows
Notes to the
Financial Statements
109 Company Statement
of Financial Position
80
81
Overview 2
Highlights
3
Financial
Operational
▪ Record Net Revenue1 up £16.2m (35%) to £63.0m
▪ Step-change in Adjusted EBITDA5 up £7.1m to £12.0m
(2022: £46.8m)
▶ corporate revenue2 up £14.5m (35%) to £55.6m
(2022: £4.9m), a 145% improvement
▶ Adjusted EBITDA margin7 increased by 8.7% to 19.1%
(2022: £41.1m)
(2022: 10.4%)
▶ supplier revenue3 up £1.7m (30%) to £7.4m
(2022: £5.7m)
▶ increased Net Corporate Revenue Retention Rate4
of 131% (2022: 120%)
▪ Inflection point with profit before tax up £4.7m
to £0.9m (2022: loss £3.8m)
▪ Cash and cash equivalents of £8.2m (2022: £6.6m) and
net cash of £3.7m (H1 2023: £0.5m; FY 2022: £3.2m)
▪ Active Members8 up 28% to 353k (2022: 275k) driven
by strong growth within our existing corporate clients
▪ Year-on-year improved levels of member
satisfaction9 which drives repeat use and value to
our corporate clients
▪ Retained all Material Contracts10 for fourth
▪ £13.9m (2022: £13.6m) planned investment in
proprietary digital platforms, communications and
technologies to enhance member experience and
create competitive advantage
▶ 80% of Material Contracts have now launched with
the Ten Digital Platform (2022: 80%)
consecutive year
Net Revenue
(£m)
Adjusted EBITDA6
(£m)
Adjusted EBITDA
Margin (%)
Profit/(Loss)
before tax (£m)
£63.0m
£12.0m
19.1%
£0.9m
Active Members
(’000)
353k
Material Contracts
28
Investment in technology,
content and communications
(£m pa)
£13.9m
Corporate revenue
Supplier revenue
45.8
5.5
40.3
44.2
3.3
40.9
46.8
5.7
41.1
34.7
2.8
31.9
63.0
7.4
55.6
12.0
19.1
0.9
(7.3)
(5.9)
(5.5)
(3.8)
353
275
28
28
13.6
13.9
24
23
25
12.2
12.2
11.5
12.8
10.8
10.4
4.8
4.4
4.9
226
203
192
2019
2020
2021 2022 2023
2020
2021
2022
2023
2020
2021
2022
2023
2019
2020
2021 2022 2023
2019
2020
2021 2022 2023
2019
2020
2021 2022 2023
2019
2020
2021 2022 2023
1 Net Revenue includes the direct cost of sales relating to certain member transactions managed by the Group.
2
Corporate revenue is Net Revenue from Ten’s corporate clients, including service fees, implementation fees, and fees for the customisation of the
Ten Digital Platform.
3 Supplier revenue is Net Revenue from Ten’s supplier base, such as hotels, airlines and event promoters which sometimes pay commission to Ten.
4
5
Net Corporate Revenue Retention Rate is the annual percentage change in corporate revenue, less non-recurring revenue (i.e. non-recurring service fees,
implementation fees, and fees for the customisation of the Ten Digital Platform), from corporate client programmes operating in the previous year.
Adjusted EBITDA is operating profit/(loss) before interest, taxation, amortisation, depreciation, share-based payment expense, and exceptional items.
The Group’s definition of Adjusted EBITDA has been updated in the current period to include National Insurance on share options.
6 2019 was pre-IFRS 16 and so no comparison to report.
7 Adjusted EBITDA margin is Adjusted EBITDA as a percentage of Net Revenue.
8
Individuals holding an eligible product, employment, account or card with one of Ten’s corporate clients are “Eligible Members”, with access to Ten’s
platform, configured under the relevant corporate client’s programme, with Eligible Members who have used the platform in the past twelve months
becoming “Active Members”.
9
Ten measures member satisfaction using the Net Promoter Score management tool, which gauges the loyalty of a firm’s member relationships
(https://en.wikipedia.org/wiki/Net_Promoter).
10 Ten categorises its corporate client contracts based on the annualised value paid, or expected to be paid, by the corporate client for the provision of
concierge and related services by Ten as: Small contracts (below £0.25m); Medium contracts (between £0.25m and £2m); Large contracts (between £2m
and £5m); and Extra Large contracts (over £5m). This does not include the revenue generated from suppliers through the provision of concierge services.
Medium, Large and Extra Large contracts are collectively Ten’s “Material Contracts”.
OverviewOverviewTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023 Strategic Report
4
Chairman’s Statement
5
I intend to further enhance our
focus on product-market fit and
ensure we are relentlessly focusing
on becoming the most valued
service in the world.”
Jules Pancholi
Independent Non-Executive Chairman
Record levels of Net Revenue
and profitability, Retaining all
our Material Contracts for
the fourth consecutive year
Introduction from Ten’s incoming Chairman
As Ten’s incoming Chairman, I start by
expressing my deep thanks on behalf of the
Group to Bruce Weatherill, who stepped
down as Chairman due to ill health on
8 November 2023.
Bruce’s stewardship and leadership played a pivotal role in
Ten’s transition to a listed company in 2017, setting the
stage for Ten’s future growth. Personally, I am grateful for
his mentorship and support, facilitating a seamless
transition to my Chairmanship. On behalf of the Board, I
also extend my thanks to Gillian Davies, Non-Executive
Director, who has indicated her intention to step down
from the Board at the conclusion of the AGM in February
2024, for her invaluable contributions to the Board and
outstanding Chairing of the Audit and Risk Committee.
As part of the Board’s orderly succession planning, we
welcome Edward Knapp and Carolyn Jameson as
Non-Executive Directors, following a robust recruitment
process. I am confident that the Board’s composition is
well equipped to meet the evolving needs of our business
as we move into the next stage of development.
I assure shareholders that they should continue to
expect the same high levels of corporate governance,
strategy, and operational accountability established by
Bruce. Under my Chairmanship, I intend to focus on
product-market fit to ensure we are relentlessly pursuing
our mission to become the most valued service in the
world. We will leverage Ten’s Growth Engine, detailed on
pages 12 and 13, to build business momentum, and adeptly
navigate the opportunities in the rapidly evolving
technology and customer landscapes.
Successfully securing B Corp certification in the year
underscores our strategy to create a unique value
proposition aligned to the goals of both corporate clients
and members.
I will measure the success of my Chairmanship not only
by the performance of the business, but through the
improvement of the share price to a level that reflects the
true value for our Shareholders that the Board believes
Ten delivers. We have a high degree of
conviction that we are operating in a
large and growing market, and in our
strategy to address it. Our focus for
the future will be on exceptional
operational accountability and
execution, demonstrating our value to
all stakeholders and thereby enhancing
shareholder value and liquidity.
Overview
Once again, Ten has achieved record levels of Net Revenue,
accompanied by a step-change in Adjusted EBITDA profitability
and margin. This success was a result of the ‘growth engine’ at
the heart of Ten’s business model. Our proposition has
improved, leading to increased activation and engagement of
more members, supported by our corporate clients. Our
investments in technology have also made us more efficient
and profitable. Our improved proposition also helped justify
improved commercial terms with our corporate clients.
Our overall Net Revenue increased 35% when compared to
the prior year to £63.0m (2022: £46.8m), with Adjusted
EBITDA increased by £7.1m to £12.0m, a 145% improvement on
the prior year (2022: £4.9m) and Adjusted EBITDA margin up
8.7% to 19.1% (2022: 10.4%).
We continued to deliver on our mission to become the
world’s most trusted service. We strengthened our ability to
attract and retain wealthy and mass affluent customers as
members on behalf of global financial institutions and other
premium brands. Continued investment in our industry-first,
proprietary technology, communications and content
amounted to £13.9m (2022: £13.6m). This drives growth and
sets us apart in the market. Most importantly, it strengthened
our proposition to global financial institutions, and other
premium brands, by improving their ability to attract and
retain wealthy and mass affluent customers as members.
Having achieved scale in many of the world’s major
economies, through expanding with existing customers and
partnering with new ones, we proudly deliver our increasingly
sophisticated and personalised platform with thousands of
integrated supplier partners from over 20 global service
centres. The market potential remains large and addressable.
Our Active Member base has grown to over 353k (2022: 275k),
with millions more members eligible to access Ten’s lifestyle,
travel, dining, entertainment, and retail benefits on behalf of
over 50 corporate clients.
Retaining all Material Contracts for the fourth consecutive
year, an improved Net Corporate Revenue Retention Rate and
expanding corporate revenue from existing clients
demonstrates the depth and strength of our partnerships
with our corporate clients. We believe that our established
corporate clients now view Ten as an integral partner for
premium product marketing, customer engagement, and
insight initiatives. Many are now entrusting us with technology
integration, personalisation, and unique content projects that
elevate member experiences, drive operational efficiencies,
and solidify Ten’s position as their trusted concierge
technology partner.
Throughout the year, we have expanded existing and forged new
strategic corporate client partnerships, with the vast majority of
Material Contracts incorporating the Ten Digital Platform into
their customer loyalty proposition. Our technology underpins
Ten’s competitive strategy as the partner of choice to a number
of global financial institutions and premium brands seeking to
attract and retain affluent customers.
Continued investment in technology, strategic partnerships,
and our people has not only fortified our resilience but has
also laid the groundwork for sustained growth through
improved member and corporate client proposition whilst
also achieving further efficiencies.
Strategy
Our strategy is to provide preferred access to a range of
premium services for the customers of our corporate clients,
facilitating seamless organisation of their travel, dining,
entertainment and other lifestyle needs.
Central to our strategy is the creation of tailored customer
loyalty propositions, driving both new and existing corporate
clients to invest in Ten’s increasingly sophisticated
personalisation platform. This investment not only enhances
the profitability and loyalty of their most valuable customers
but also fuels our continuous advancements in technology,
content, and service quality. This, in turn, fortifies our unique
member proposition and propels the Growth Engine at the
heart of Ten’s business model.
The Group thrives on established and new corporate client
partnerships, primarily in the financial services sector, with a
strong track-record of growing the value of these
partnerships over time. We are also working with other
premium brands seeking to enhance engagement, retention
and acquisition of their high-value customers.
Ten’s unique member proposition ensures members access
attractive and often premium benefits and experiences not
available to the public. Membership leverages combined
buying power and operational scale, enabling members to
achieve better and more cost-effective outcomes, more
conveniently than they could on their own. The member
proposition is accessible for online search and booking through
Ten’s market-leading proprietary lifestyle and travel technology
platform – the “Ten Digital Platform” – or via our expert Lifestyle
Managers, available by phone, email, live chat and WhatsApp.
Our continued investments in technology comprise our Ten
Digital Platform – and in the supportive infrastructure for our
team. Backed by 25 years of expertise, our Lifestyle Managers
provide members with 24/7 services in over 18 languages,
reflecting in our Net Promoter Score (NPS) that indicates
positive member impact to us and our corporate clients.
Artificial Intelligence (AI) and Environmental, Social and
Governance (ESG) considerations have been pivotal in shaping our
decision-making and strategy and will remain so in the future.
AI presents significant opportunities for operational efficiency
and customer experience, and we have adopted a strategy of
rapid experimentation across all areas of the business.
Beyond supporting good governance and global climate
change management, ESG offers a substantial opportunity to
enhance our differentiation and value proposition to both our
members and our corporate clients.
The ESG Working Group, established in 2021, will remain
under my Chairmanship, focusing on assessing material ESG
risks and opportunities stemming from our business. Its
ongoing efforts aim to deliver on our strategy by developing
internal reporting and transparency, instigating behavioural
change within the business, and ensuring that we offer our
members ESG-friendly choices in their interactions with us.
The Board’s commitment to ESG is exemplified by our
successful B Corp certification this year, following strong
shareholder support for the amendment to our Articles of
Association in July 2022. We are dedicated to maintaining our
B Corp certification, ensuring it continues to deliver
significant positive effects for the Group and all stakeholders.
Strategic reportStrategic reportTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023 6
Chairman’s Statement continued
Chief Executive’s Statement
7
Our market-leading digital
capabilities differentiate us from
our competition, paving the way
for record Net Revenue and
Adjusted EBITDA profitability.”
Alex Cheatle
Chief Executive Officer
Successful business model with
record revenue and profitability
→ The Growth Engine is at the heart of Ten’s business model
Ten is the partner of choice to a number of global
financial institutions and premium brands”
Results
Net Revenue grew by 35% to £63.0m (2022: £46.8m),
surpassing pre-COVID-19 levels (2019: £45.8m). This growth
was fuelled, in part, by the increased budgets of our
corporate clients leveraging Ten’s platform to enhance their
own customer metrics, a clear demonstration of
client-product-market fit and shared goal alignment.
Additionally, there was heightened demand for technical
platform integration services and member marketing
services. Successful contract repricing, both in the year and
in previous years, also contributed to performance.
Delivering Adjusted EBITDA profitability and maintaining a net
cash position, whilst maintaining investments in technology,
are key performance indicators of the Group’s strategic Growth
Engine. Notably, the Group secured contract developments
during the year, including launching a new programme in the
Americas that has grown to the equivalent of a Medium
contract, expanding a programme in Latin America to the
equivalent of a Large contract and winning a new contract in
Europe expected to grow to a Medium contract.
The Group retained all of its Material Contracts and entered
new agreements with existing corporate clients for multi-year
contract extensions, significant expansions, and paid-for
projects to customise the Ten Digital Platform. To support our
substantial growth and the launch of new programmes, we
raised a moderate level of debt, demonstrating a strategic
approach to working capital requirements.
Board composition and our People
The Group continues to benefit from a stable and impactful
founder-led executive management team, showcasing
strength in leadership, innovation and resilience to grow the
business over the long term in all regions.
In addition to the Non-Executive changes to the Board
detailed in my introduction, I was pleased to welcome
Victoria Carvalho, Chief Proposition Officer, as an Executive
Director of the Board on 22 February 2023. Victoria brings
extensive experience, spanning over 20 years in strategic
roles focused on operational growth, including notable
positions at Nasdaq and Thomas Reuters in New York and
London. Since joining Ten in 2018 as a member of the Senior
Leadership Team, she has played a pivotal role in developing
Ten’s unique proposition, providing access to a diverse range
of benefits and experiences across major consumer markets.
At the same time, we bid farewell to Sarah Hornbuckle as an
Executive Director, who continues to contribute as the Client
Services Director. We extend our sincere thanks to Sarah for
her dedicated service since joining in 2001 and to the Board,
playing an instrumental role in the success of Ten.
Our commitment to developing our people is evident, in part,
through the Ten Academy and Ten’s Global Leadership
Programme – a twelve-month internal development initiative
shaping the Group’s future leaders on a global scale.
Nurturing an employee culture rooted in Ten’s principles of
transparency, education, promotion, engagement, and
Diversity, Equity, and Inclusion (DEI) Programme, underpinned
by our recent B Corp certification, continues to support our
diverse, global workforce and helps us attract, retain and
develop the best talent.
In strategic alignment with our commitment to sustained
growth, the Group adjusted headcount this year, emphasising
operational efficiency, regional variations in demand, and a
reorganisation of the business, preparing the business for the
next phase of growth.
On behalf of the Board, I express gratitude to the entire Ten
team for their adaptability, professionalism, and steadfast
commitment throughout the year. Their contributions are
invaluable, and we take great pride in their dedication to our
collective success.
Summary
Amidst a challenging macro environment, Ten has not only
weathered the storm but excelled with record Net Revenue
and Adjusted EBITDA profit and margin, showcasing the
resilience of our business model and the inherent value we
bring to corporate clients as integral components of their
customer engagement strategies. Our ability to retain and
grow corporate clients speaks to the strength of our
partnerships, serving as the chosen loyalty platform for many
of the world’s leading brands.
We believe changes in technology, consumer’s evolving
lifestyle demands and the fact that corporate clients need to
create deeper connections with their customers means there
is considerable room for growth in the market. Actions taken
this year, and those planned for 2024, underscore our
commitment to seizing these global opportunities.
I express sincere gratitude to our Shareholders for their
support throughout the year.
Jules Pancholi
Non-Executive Chairman
21 November 2023
Strategic reportStrategic reportTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023 8
Chief Executive’s Statement continued
9
Overview
In the year, we achieved remarkable milestones, including a
35% growth in Net Revenue for the second consecutive year.
The Group also more than doubled Adjusted EBITDA to
£12.0m (2022: £4.9m), increased its Adjusted EBITDA margin
and achieved its first positive profit before tax (PBT) since
IPO. This marks a step-change in Ten’s profitability, whilst
continuing to invest into our proprietary technology, including
AI, that will drive our future success.
The “Growth Engine” at the heart of our business continues
to demonstrate its effectiveness.
By delivering high service levels across our high-touch and
digital platforms, which improve customer profitability
metrics for our corporate clients, we have retained all of our
Material Contracts for the fourth consecutive year, increased
Net Corporate Revenue Retention Rate to 131% (2022: 120%)
as well as securing new contracts.
We closed the period with a record Net Revenue run rate,
improved Adjusted EBITDA, an enhanced digitally enabled
service platform, and a healthy sales pipeline of new business,
positioning the Group well for the next phase of growth.
Record Net Revenue and profitability
Our market-leading digital capabilities differentiate us from
our competition, paving the way for record Net Revenue and
Adjusted EBITDA profitability. Notably, Net Revenue increased
by 35% to £63.0m (2022: £46.8m), Adjusted EBITDA was up
£7.1m to £12.0m (2022: £4.9m), a 145% improvement on the
prior year and Adjusted EBITDA margin increased by 8.7% to
19.1% (2022:10.4%).
The substantial growth in Net Revenue from our corporate
clients, which increased 35% to £55.6m (2022: £41.1m) can be
attributed, in part, to increased member activity (paid for by our
corporate clients) and revenue from contract developments.
Additionally, Net Revenue from our supplier partners,
predominantly commission related to our members’ travel,
rose by 30% to £7.4m (2022: £5.7m). Operating expenses and
other income increased by £9.1m to £51.0m (2022: £41.9m),
principally driven by increased headcount required to service
the heightened activity across the business.
A step-change in Adjusted EBITDA profit and margin (and
PBT) was fuelled by enhanced efficiencies, driven by the
growing professionalism of our operational staff and
advancements in our technology.
Cash generated from operations in the year increased by £6.7m
to £11.5m (2022: £4.8m). The Group concluded the year with
cash and cash equivalents totalling £8.2m (2022: £6.6m) and
improved net cash of £3.7m (H1 2023: £0.5m; FY 2022: £3.2m).
Regional analysis
Europe
In Europe, our commitment to enhancing services for
members and corporate clients in our most mature markets,
alongside our expansion into maturing markets in Continental
Europe, has proven successful.
Regional Net Revenue achieved robust growth of 26% to
£25.9m (2022: £20.6m). This was fuelled by increased
member activity, contract expansions, and heightened
member engagement rates, paid for by supportive corporate
clients. Notably, several flagship corporate clients with
Material Contracts increased their budgets during the period.
We retained all Material Contracts and we won new
mandates from corporate clients in the region.
Developments in the region also resulted in strong Adjusted
EBITDA growth of £4.3m to £9.2m (2022: £4.9m), a 88%
increase. This represents a 36% Adjusted EBITDA margin for
our most mature region.
Americas
We celebrate another year of substantial growth and
enhanced Adjusted EBITDA profitability in the Americas.
Developing this region, home to almost 50% of the world’s
High Net Worth Individuals, is a key objective for Ten.
Net Revenue in the region was up 56% to £25.8m (2022: £16.5m),
driven by the healthy growth of existing contracts and new
client mandates. The region also achieved an Adjusted
EBITDA profit of £1.9m (2022: £(0.7)m) due to the success of
contracts launched in the prior year, after a period of
investment in growth.
We believe that key developments in the US market, the
largest market in the region, such as JPM Chase’s proactive
efforts in developing travel and lifestyle offerings and Capital
One’s acquisition of Velocity Black, a smaller competitor of
Ten, for a reported US$296m11, have had a positive ripple
effect, sparking interest from other banks and wealth
managers in Ten’s proposition, paving the way for Ten to
engage with potential new corporate clients.
AMEA
The AMEA region demonstrated solid growth, with Net
Revenue increasing by 16% to £11.3m (2022: £9.7m) and
achieving a £0.2m increase in Adjusted EBITDA to £0.9m
(2022: £0.7m), an 29% increase.
11
Hurley, J. (2023, June 2). Founders of Velocity Black bank US $80m from Capital One. The Times. Retrieved from
https://www.thetimes.co.uk/article/founders-of-velocity-black-bank-80m-from-capital-one-z6gtj9qx0.
Net Revenue
£63.0m +35%
(2022: £46.8m)
Adjusted EBITDA
£12.0m +145%
(2022: £4.9m)
Profit/(Loss) before tax
£0.9m
(2022: £(3.8m))
Active Members
353k +28%
(2022: 275k)
Investment in technology, content,
and communications
£13.9m +2%
(2022: £13.6m)
Our early adoption of AI
reflects our commitment
to harnessing its potential
in 2024 and beyond.”
Our investments in technology, AI and
content continues to drive our market-
leading digital capability
We continued to benefit from the quality, operational, and
competitive advantages of our digital capability. We invested
£13.9m in technology, communications, and content in the
year (2022: £13.6m). We believe that our strategic focus on
market-leading digital capability clearly differentiates us from
our competitors and underpins our long-term “Growth
Engine” strategy to become the world’s most trusted service.
Throughout the year, these investments led to significant
advancements in our digital roadmap, detailed on pages 20
and 21. Notable improvements include enhanced
personalisation, user experience, and the introduction of new
“self-serve” digital capability, ultimately reducing the cost to
serve and delivering a stronger Return on Investment for our
client’s customer loyalty budgets, unlocking additional budget
to spend on Ten’s full suite of services.
Our early adoption of AI reflects our commitment to
harnessing its potential in 2024 and beyond to turbo-charge
our Growth Engine by improving efficiency and also service
quality. We are already seeing material results in multiple
areas and are completely committed to leveraging AI in 2024
and beyond.
In the short-term, AI is already driving efficiency and output
across the business from translations to coding and quality
assurance for high touch requests. We have also launched an
AI “co-pilot” for Lifestyle Managers, who comprise the largest
group of employees, to support more efficient and high
quality service. Further details on our AI initiatives can be
found on page 21.
Our unique “not available on the internet” assets, such as
exclusive tables at top restaurants, tickets for sold-out
shows, exclusive events and value-add benefits at hotels,
empowers our AI to deliver value for our members via our
digital self-serve and high-touch channels. This advantage,
coupled with our digital self-serve and high-touch channels,
sets us apart from mass-market AI interfaces reliant on
publicly available assets.
Strategic reportStrategic reportTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023 10
Chief Executive’s Statement continued
Investment Case
11
Enhanced member proposition, satisfaction,
and engagement
Throughout the year, we have strengthened our core
propositions, as set out on pages 14 to 17, to deliver a more
compelling and accessible offering to serve existing members
and attract new members.
Current trading and outlook
We continue to drive revenue through increased activity from
existing Active Members and “first time users” from our
existing Eligible Member base. In addition, we have a healthy
pipeline of new partnership opportunities that will further
increase our Eligible Member base.
The attractiveness and accessibility of our proposition directly
correlates with heightened engagement, usage, and advocacy
among our members. Member engagement and satisfaction
are key to building value for corporate clients, who want to
improve the engagement, retention, and acquisition of their
most valued customers. This, in turn, justifies increased
corporate spending with us and attracts new corporate
clients and new supplier partners to work with us.
Our corporate clients pay us to improve the engagement and
retention of their wealthiest customers that then drives their
commercial metrics. Many of our banking clients, partly due
to higher interest rates, are reporting higher levels of
profitability from this customer demographic when
compared with the low interest rate environment from 2008
to 2021. This improves the return on their investments with
Ten and helps underpin our revenue expectations.
A digitally enabled platform
driving customer loyalty for
global financial institutions
and other premium brands
→ Watch our investor presentation at www.tenlifestylegroup.com/investors
We expect to continue to convert our strong pipeline of
contract opportunities with global financial institutions and
premium brands, with multiple new contract developments
since the start of the financial year due to deliver revenues
from H2 2024.
We remain focused on increasing both Net Revenue and
Adjusted EBITDA profitability. We plan to maintain investment
in our proprietary technology, communications, and content,
which provides competitive advantage, with investment into
AI. Loans raised to date will continue to support the Group’s
working capital requirements and we expect cash generation
across the full year, with H2 being stronger than H1.
Trading to date, our high corporate client retention rates,
strong service levels, improving profitability, healthy sales
pipeline, and continued investment to improve our
technology and proposition mean that, although early in the
year, we are optimistic about another year of growth for both
Net Revenue and profitability.
Alex Cheatle
Chief Executive Officer
21 November 2023
We are delighted to have achieved another strong year of
member satisfaction, as measured by Net Promoter Score
(NPS), showing a marginal increase from the previous year.
We believe that our member satisfaction levels and strengthened
member proposition have resulted in an increase in repeat usage
of our service and growing numbers of Active Members using the
service. These metrics not only underscore the success of
our member-focused initiatives but also serve as compelling
evidence of the return on corporate client investment in our
service, contributing significantly to our high levels of corporate
client retention.
Summary
We have retained all our Material Contracts for the fourth
consecutive year, with an increased Net Corporate Revenue
Retention Rate of 131% (2022: 120%), and have launched new
contracts in the year. We have continued our record of
retaining all Material Contracts where we have launched our
Ten Digital Platform.
We believe our competitive position is stronger than ever,
backed by global reach and a market-leading member
proposition, which delivers a strong return on investment for
our corporate clients. This has been achieved by continuing to
invest in our technology, content, and market expertise and
better pricing, access, benefits, and integration with our
supplier partners.
By developing the platform, and in turn our corporate clients,
we have grown Net Revenue by 35% during the year. Our
commitment to innovation is underscored by our continued
investments in technology, including AI, content, and supplier
partnerships, which has enhanced the service to members
and corporate clients. This strategy recognises the
importance of innovation in building our market position and
improving service levels, whilst delivering a step-change in
Adjusted EBITDA profitability of £7.1m to £12.0m (2022: £4.9m)
and Adjusted EBITDA margin up to 19.1% (2022: 10.4%).
I am proud of how our people across our offices globally
continue to professionally deliver and innovate high-quality
service to our members, paid for by our corporate clients. I
would like to express my thanks also to our outstanding
management team, which continues to drive the business
successfully towards our mission of becoming the world’s
most trusted service.
A significant, immediate market opportunity
with huge potential
▪ Proven to increase Active Member numbers and revenue per member, that
develops revenues, largely paid to us by premium brands, often in financial
services, to drive loyalty of their most profitable customer segments
▪ Ten’s service becomes the best way for mass affluent and high-net-worth
individuals (HNWI) to access and organise dining, travel, entertainment, and
premium shopping
← Roka, Dubai, one of Ten’s restaurant partners
The established market leader for
technology enabled concierge services
▪ The leading global, lifestyle and travel platform, in 18 languages and 100+
countries
▪ Loyal, long-term corporate contracts
▪ A growing, engaged HNWI member base
← The Travel Search function on Ten’s Digital Platform
A proven Growth Engine at the heart of our
business model
▪ Drives increasing profit and service levels with scale improving
technology/proposition
▪ Drives return on investment for our corporate clients
▪ Revenue grows as existing corporate clients invest more, and we win new clients
▪ Robust revenue model with contractual minimums, backed by multi-year terms
← Coldplay performs at Etihad Stadium, where Ten secure hospitality packages for our
members.
Credit: Shirlaine Forrest/WireImage, Getty Images
Strategic reportStrategic reportTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023 12
Business Model
13
Ten’s Growth Engine – proposition,
profitability and scale
Three strategies fuelling
Ten’s Growth Engine
The Growth Engine is at the heart of Ten’s business model. It grows service quality
and generates cash over time and as Ten scales, creating value for shareholders
and a competitive position.
1.
2.
3.
Building a strong
member-led
proposition
Growing the
investment from
corporate clients
Investing in Ten’s
service platform
Achieving this strategy
To become the most trusted service
in the world, our focus remains on
delivering a “member-first” service
and proposition that is reliable,
relevant, and valued, with people and
technology that act in the members’
best interests.
Members engage with a valued,
trusted, and convenient lifestyle
platform spanning travel, dining,
premium shopping, live entertainment,
and events. The platform provides
exceptional access, benefits, and
value across multiple consumer
markets, adapting to individuals’
evolving needs. This, in turn,
strengthens and deepens
the loyalty of our members to
our corporate clients’ brands.
Achieving this strategy
Corporate clients engage Ten’s
services to improve engagement,
retention, and acquisition of their
premium customers, and Ten is often
chosen over other retention and
acquisition tools. Collaborating with
Ten enables corporate clients to
achieve their objectives in digital
transformation, customer advocacy,
assets under management (AuM),
and spend on related payment
card product.
By demonstrating quantifiable
returns on investment (ROI) for our
corporate clients, this encourages
clients to further develop and invest
into their travel and lifestyle
proposition for their customers.
Achieving this strategy
Profits generated from increased
revenue by the Group facilitate
additional investment to further
enhance and deepen our proposition.
Strategic investment areas are
technology including AI, content, and
supplier partnerships. The collective
purchasing power of our members
allows us to negotiate better access,
value, and benefits.
Additional enhancements to the
Ten Digital Platform, a growing
content library, supplier partnerships,
and automation improve service
speed and efficiency. This, in turn,
generates profit and cash, and
continued investment ensures that
the member proposition is more
compelling over time.
↘ Beyonce’s 2023 Renaissance World
↘ Salon Prive, one of Ten’s member
↘ The “Follow Interests” function on
Tour, an event for which Ten
sourced tickets for members
Credit: Kevin Mazur/WireImage for
Parkwood, Getty Images
events
the Ten Digital Platform
Strategic reportStrategic reportTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023 14
Strategy in Action
15
1. Building a strong
member-led proposition
Throughout the year, we have
pursued our vision of being
the premier choice for
affluent and high-net-worth
consumers to manage their
diverse lifestyle and travel
requirements by enhancing
our member offerings. A
robust member proposition
fuels member engagement
and delivers results for our
corporate clients.
Travel and tourism
Strategy
Comprehensive, personalised travel guidance
and bookings, including online flight, hotel, car
rental bookings and attractions accessible via
the Ten Digital Platform, with better value
than the internet, as well as bespoke
vacations and unique travel experiences
serviced by experts in luxury travel.
▪ Leverage the collective buying power of
our members to extend the range, value
and access of the core travel propositions,
including Ten’s Global Hotel Collection,
Essential Hotel Collection, Direct
Connections programme, and travel
activities or attractions
▪ Produce engaging travel articles, a digital
travel magazine, and destination guides,
highlighting the extensive range of our
global travel offerings, benefits,
experiences, and expert knowledge
▪ Utilise the travel module of the Ten Digital
Platform, allowing members to find travel
inspiration and conveniently search for
and book flights, hotels, car rentals, and
activities or attractions
▪ Provide impartial recommendations and
superior value for money compared to
other travel providers, as we are not
primarily dependent on commission fees
for revenue generation
▪ Offer travel experts to plan tailor-made,
once-in-a-lifetime holidays for our HNWI
members and their families
Progress
▪ Expanded Ten’s Global Hotel Collection,
increasing the portfolio to over 4,320
luxury hotels (2022: 4,204) that offer
additional benefits to our members
▪ Relaunched our Essential Hotel Collection
of 650,000 3* to 5* hotels globally with on
average 15% cheaper pricing than online
travel agents
▪ Implemented enhancements to our online
hotel proposition UX/UI to enable greater
differentiation across client sites and
improve booking conversions
▪ Successfully launched Viator, one of the
largest activities service providers, on the
Ten Digital Platform. This integration
provides access to over 250,000 activities,
tours, and day trips in more than 3,000
locations worldwide
▪ Continued to develop our suite of travel
guides and itineraries, which now stand
at 355 in total, 305 of which are in
non-English languages
▪ Published a total of 21 issues of “Explore”
covering inspirational content of
destinations, features of new hotel
partnerships, and benefits to promote
member use of the service
↑ A Ten member exclusive event with Dior in London
Dining
Entertainment
Premium retail
Strategy
Dining recommendations from expert
Lifestyle Managers and premium access
to the best restaurants with online
reservations, not available to the public,
through the Ten Digital Platform.
Strategy
Member-only access to and recommendations
for expert sports, theatre, music and at-home
entertainment, along with face-value (or
better) tickets with seamless online bookings
through the Ten Digital Platform.
Strategy
Member-only benefits, exclusive access, and
tailor-made events in collaboration with
top-tier, luxury renowned or up-and-coming
brands, retailers, and products, all redeemable
online through the Ten Digital Platform.
▪ Expand Held Tables programme, offering
preferential access to the world’s most
popular restaurants
▪ Produce high-quality, editorial reviews and
restaurant recommendations, shared with
members via the dining module of the Ten
Digital Platform, personalised emails or
direct from Lifestyle Managers
▪ Organise exclusive restaurant take-overs
for members to create unique and
memorable dining experiences
▪ Strengthen buying power, long-term
relationships, in-house expertise, and
reputation to secure access to the best
restaurants, with even more premium
experiences and offers at peak times
▪ Expand partnerships with ticketing
platforms, venues, providers, and
promoters to secure access, pre-sale
tickets, offers, and face-value tickets for
the most soughtafter events
▪ Develop entertainment newsletters for
members discovering entertainment,
experiences, and events with advance,
exclusive or discounted access
▪ Expand our portfolio by adding hundreds of
premium and emerging retail brands,
making them easily accessible for
searching, redeeming, and purchasing
through the Ten Digital Platform’s offer and
experience modules.
▪ Leverage our members’ buying power to
secure exclusive benefits, discounts, and
access to high-end brands.
▪ Develop a personalised approach, tailoring
▪ Use personalised email marketing
entertainment recommendations to
individual member preferences and
interests
campaigns to highlight relevant offers for
our members, including editorial guides, gift
ideas, experiences, and events.
▪ Leverage the power of our membership
base to negotiate special allocations,
priority access, and VIP experiences for
our members
▪ Host exclusive member-only in-person and
virtual gatherings in collaboration with
premium retailers, complimentary to our
members.
Progress
▪ Maintained the Held Tables programme
with over 2,000 restaurants across 160
cities (2022: 102 cities)
▪ Maintained the portfolio curated and
searchable reviews to just under 11k of
the world’s top restaurants (2022: c.10k)
▪ Published a total of 25 issues of “Dine”,
“Wine” and “Cook” which include a
collection of articles and recipes
contributed to by world-class chef partners
Progress
▪ Engaged more than ten new
entertainment partners, expanding Ten’s
access to the most sought after shows
and events
▪ Booked special events tickets across
various events including Taylor Swift’s
concert, UK and European football league
matches, O2 Arena VIP suites, and
Wimbledon hospitality packages
▪ Launched Ten Box Office technology ,
allowing more efficient handling of ticket
sale, allocations, and guest list
management
▪ Source rare and desirable luxury products
for our members
Progress
▪ Expanded the offers available to buy or
redeem on the Ten Digital Platform to over
1,700 (2022: >760)
▪ Over 190 events held globally, including Ten’s
Book Club arranged for members featuring
award-winning authors (2022: >235 events)
▪ Launched exclusive client commissioned
events sourced and hosted – ranging from
wine tasting to private viewings at galleries
and museums
Strategic reportStrategic reportTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023 16
Strategy in Action continued
17
1. Building a strong member-led
proposition continued
Growing member engagement
Ten’s Eligible Member base primarily comes from its partnerships with corporate clients.
The affluent and high-net-worth member base enhances Ten’s ability to secure top-tier
access, offers, and benefits from supplier partners, further enriching Ten’s member
proposition. This is reinforced by our expert Lifestyle Managers, the Ten Digital Platform,
captivating editorial content, and targeted email marketing, which together drive member
engagement, expand our Active Member base, and boost usage frequency.
Active Members up 28%
Individuals who possess an eligible product, employment,
account, or card with one of Ten’s corporate clients become
“Eligible Members”, with access to Ten’s platform and service,
registered to the relevant corporate client’s programme.
Those who have utilised the platform or service within the
past twelve months are considered “Active Members”.
Ten’s acquisition of Eligible Members is underpinned by the
existing corporate clients and launch of new corporate
programmes, as further described on pages 18 and 19.
A record number of Active Members used Ten’s platform this
year, a 28% increase on prior year. The scale of the Active
Membership represents member engagement, which fuels
Net Revenue growth and is used by senior management to
track performance. Accordingly, it is one of the Group’s KPIs
and is regularly reviewed by the Board alongside the key
financial performance indicators set out on pages 22 and 23.
Record levels of member engagement has resulted in a 30%
increase in the revenue Ten earns from some of its supplier
partnerships, such as hotels, airlines, and event promoters,
which sometimes pay commission to Ten (2023: £7.4m; 2022:
£5.7m). Rather than negotiating higher levels of supplier
commissions, Ten prioritises securing the best member
benefits to drive member satisfaction.
Total Active Members (’000)
353k
353
275
226
203
192
2019
2020
2021
2022
2023
↑ Norma restaurant in London, part of Ten’s Global Dining Collection
Member engagement strategies
Continued improvements in member engagement
strategies have also driven the record levels of
member engagement.
Corporate client platform integration
Ten’s platform is increasingly being integrated with
corporate client technology, delivering seamless access,
including via self-registration and single sign-on, as well
as Ten’s Open Application programming interfaces (APIs)
which interface modules of the Ten Digital Platform
with the corporate client’s branded digital applications.
On-boarding journey
We welcome members who are new to the service
through a series of eCRM communications to help them
understand the service and how to get the most out of
it. A bullseye routing feature on our telephony systems
helps us to identify inbound calls from “first time”
users and route those calls to Lifestyle Managers best
skilled at welcoming new members.
Targeted member communications
Ten’s editorial-led content and eCRM team tailors
member communications, ensuring members have
access to benefits relevant to their lifestyle and
activities, with a 59% average email open rate of general
emails (2022: 48%).
Automated communications
Out of the 14.4m member communication emails sent
(2022: 11.5m), 39% (2022: 43%) were automated, riggered
by member behaviours and sent without any manual
intervention, offering useful, inspiring information about
their upcoming bookings.
Net Promoter Score (NPS)
As a consequence of enhancements made to our member
proposition, we have once more attained a higher Net
Promoter Score (NPS), our principal gauge of service quality
and member satisfaction. This metric serves as a KPI
employed by senior management and is frequently observed
by the Board in tandem with the key financial performance
indicators detailed on page 48. High satisfaction levels
contribute to the growth of Active Members, as contented
users are more inclined to continue utilising the service.
In addition, we assess service quality against our
in-house quality assurance benchmarks to ensure
optimal performance.
NPS (Net Promoter Score)
2017
2018
2019
2020
2021
2022
2023
Strategic reportStrategic reportTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023 18
Strategy in Action continued
19
2. Growing the investment
from corporate clients
Global financial institutions and premium brands choose Ten’s service
platform to attract, engage and retain their valued customers. Ten
continues to grow through existing and new contracts as corporates
see measurable impact on their commercial and customer metrics.
Corporate client contract wins, renewals,
and expansions
The Group has secured significant contract developments,
notably securing the expansion of a digitally enabled
concierge programme in the Americas for premium
customers. Initially anticipated as a Medium-sized contract,
its success led to an expansion, transforming it into a
Large-sized contract. Exceptional member engagement levels
during the programme launch exceeded expectations,
resulting in additional commitment from the client. It has
now agreed to expand the programme, including client-
funded customised content and assets.
We have not lost a corporate client with a Material Contract
in the last four years. This is testament to the commercial
results that drive our corporate clients’ bottom line and their
continued investment in Ten’s customer loyalty proposition.
The Group secured contract extensions and expansion of
contracts with some of our existing corporate clients
including a banking product on sale, which includes Ten’s
digitally enabled concierge and lifestyle service, which has
proven popular with its customers. Notably, some of our
corporate clients continued to invest in their digital
proposition and differentiate their member experience by
commissioning custom technology development projects
with Ten.
The Group maintains a strong sales pipeline of prospective
corporate clients in the financial services sector as well as
other premium brands.
↑ Burnt Ends in Singapore, part of Ten’s Global Dining collection
Growing existing programmes
The Group reports a segmented analysis of our members to
better reflect the growth potential of existing programmes. It
categorises members by their perceived value to the corporate
client programme to which they are attached. We then analyse
the Active Member penetration rate12.
The Very High Value segment includes members attached
to programmes with private banking corporate clients,
which typically have a high level of investable assets under
management and hold premium, high-fee products. The
potential (and actual) customer loyalty budgets of private
banking corporate clients for such individuals are typically
higher due to the profitable nature of their accounts, especially
in the current climate of high interest rates. Typically, the
Active Member penetration rate in this segment is higher, as is
the average corporate revenue per Active Member.
The High Value segment includes members attached to
programmes with mass affluent retail banking corporate
clients or credit card holders of an issuing bank programme.
The Medium Value segment includes members attached to
programmes where the corporate client may hold or manage
a relatively lower per capita value per annum. The majority of
these members have access to a programme via a specific
type of card product and we acquire Eligible Members via
contracts with the payment network provider. As such, the
number of Eligible Members in this segment is very large and
typically reports a lower Active Member penetration rate.
Eligible Members
Eligible Members in High and Very High
value segments (’000)
2,104
1,520
1,942
1,403
1,594
1,062
1,366
923
1,156
669
443
487
532
539
584
2019
2020
2021
2022
2023
Very High Value
High Value
In the year, the Eligible Member base within the High Value
and Very High Value segments grew by 8%. This was driven
mostly by the acquisition of new customers through
sponsoring corporate client sales and marketing activity or
increases in eligibility, for example through increased assets
under management within the existing portfolios as well as
new programme launches.
The world’s population of High Value and Very High Value
customers of corporate clients is substantially larger than our
current Eligible Member base, representing significant
opportunities for growth. The global HNWI13 population was
estimated to be at 21.7m in 202214, which is used by the Board
as an approximation of the total addressable population of
Very High Value Eligible Members.
Active Members
Total Active Members, all segments (’000)
192
112
53
27
2019
226
143
55
28
2020
203
132
49
22
2021
353
217
70
66
275
172
59
44
2022
2023
Very High Value
High Value
Medium Value
Active Members are members who have used the service at
least once in the past twelve months. We saw a healthy
growth in the number of Active Members driven by increased
demand from members as our proposition and activation
methods improve, and some corporate clients supported
increased marketing activities, subject to client budgets.
The Active Member base of the Very High Value segment
increased to 66k (2022: 59k). The overall average Active
Member penetration rate of the Very High Value segment
is 11%. Developed programmes with strong engagement
strategies have stronger Active Member penetration rates of
over 60%, and developing programmes have a typical Active
Member penetration rate of 25–30%. This indicates that we
can influence the average Active Member penetration, and
the resulting revenues, across our combined portfolio of
Eligible Members.
The Active Member base of the High Value segment was 70k
(2022: 44k), with an average Active Member penetration rate of
5% (2022: 3%). Growth in the segment was attributable to the:
▪ growth of Eligible Members from continued acquisition of
customers by corporate clients;
▪ increase in the number of Active Members as sponsoring
brands, driving marketing, member engagement, and
demand for our core services; and
▪ growing repeat use by Active Members as the proposition
and service continue to strengthen, ensuring engaged
members continue to stay active
12 Individuals holding an eligible product, employment, account or card
with one of Ten’s corporate clients are “Eligible Members”, with access to
Ten’s platform, configured under the relevant corporate client’s programme,
with Eligible Members who have used the platform in the past twelve months
becoming “Active Members”. The Active Member penetration rate is the
number of Eligible Members that become Active Members in the period.
13 CapGemini Research Institute’s World Wealth Report (2023) defines a
high-net-worth individual (HNWI) as someone with investable assets
over US$1m excluding primary residence, collectibles, consumables
and consumer durables.
14 CapGemini Research Institute’s World Wealth Report (2023).
Strategic reportStrategic reportTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023
20
Strategy in Action continued
21
3. Investing in Ten’s service platform
We aim to use technology and content
to improve our members’ experience
and service efficiency and deliver
differentiation and commercial impact
for our corporate clients.
£13.9m
(2022: £13.6M) INVESTED IN PROPRIETARY
DIGITAL PLATFORMS, COMMUNICATIONS,
AND TECHNOLOGY
Our investment in technology is focused on the areas of the
Ten Digital Platform, TenMAID, AI, content, communications,
and other technologies.
Ten Digital Platform
Ten’s proprietary digital platform (the “Ten Digital Platform”)
is established in all three global regions and is now available
to members in over 100 countries, supporting 18 (2022: 18)
languages and over 39 currencies. We believe it is the only
global, multi-category transactional lifestyle and travel
platform, backed by expert Lifestyle Managers.
The Ten Digital Platform is live with our corporate client brands
globally, including 80% (2022: 80%) of our Material Contracts.
We believe corporate clients are increasingly paying us to
customise the Ten Digital Platform to suit their specific
needs and the preferences of their most valued customers
and integrate it with their own technology, supporting their
brand and customer engagement strategy. Customisation
options include:
▪ modules and sub-modules turned on/off
▪ full white labelling/branding capabilities
▪ languages, currencies, and home markets
▪ customised content and assets
▪ payment controls to drive spend on cards
▪ design customisations and integrations, including SSO
▪ easy-to-integrate suite of Ten Open APIs
In addition to new platform launches for new and existing
corporate clients, the team has also ensured that the
Ten Digital Platform is well maintained for resilience and
security. As part of our product roadmap, we have designed
and developed key features to add functionality to the Ten
Digital Platform to meet members’ needs, as well as improve
the overall user experience and accessibility of the platform.
Key improvements to the Ten Digital Platform include:
▪ launch of the new Travel Activities feature on the
travel proposition
▪ expanded member “follow” feature to include a broad
range of interests (e.g. wine tasting or cricket) in addition
to artists/bands
▪ introduction of waitlist capability especially for
“fully-subscribed” complimentary events and
upcoming events
▪ enhanced member browsing experience across inspiration,
dining, and travel categories
▪ introduction of ESG category filters
We retained our PCI DSS Level 1 accreditation and SOC Type 2
certification during the year. These require regular, in-depth
audits of our payment and data procedures as well as our
underlying technology, providing comfort to our corporate
clients around our security measures and compliance.
Content
Ten’s content team combines creativity and data to reach,
influence, and resonate with our affluent and high-net-worth
members. Staffed by award-winning journalists and creatives,
the rich library of custom content is proving invaluable in
driving engagement and is valued by members and our
corporate clients.
Member engagement continues to improve through better
personalised and targeted proactive email marketing, meaning
members have better access to the services, offers, and
benefits that they are most interested in. In the year, selected
corporate clients have also commissioned custom travel and
lifestyle content briefs from Ten’s content proposition.
In 2023 we:
▪ published 45 (2022: 45) lifestyle magazine editions across
the globe covering dining, travel, days, wellness, days out,
home and interiors, wine, and fashion
▪ sent 14.4m member communications emails (2022: 11.5m)
▪ increased the average open rate to 59% (2022: 48%)
▪ used videos promoting events and supplier partners to
increase engagement and expanded the use of social media
channels, including Instagram and YouTube, to drive the
visibility and attractiveness of our key member propositions.
Artificial intelligence (AI) and TenMAID
Ten’s proprietary customer relationship management platform
(“TenMAID”) supports our expert Lifestyle Managers to deliver
personalised, high-quality lifestyle and concierge services to
our members 24/7/365, wherever they are in the world. It
enables Lifestyle Managers to securely access the member’s
profile and search Ten’s entire inventory to fulfil the member’s
request efficiently, the success of which we believe is reflected
in our year-on-year improved Net Promoter Score (NPS).
TenMAID and the Ten Digital Platform are integrated with a
communications platform to enable members to access our
expert Lifestyle Managers by phone, email, webchat, and
WhatsApp. In the year, we’ve continued to make improvements
in TenMAID including faster member search, more robust and
efficient Identification & Verification process, further
automation of operational tasks, and usability. These
developments contribute to operational efficiencies and
ultimately member satisfaction.
In the year, we have built a Ten-specific enterprise variant
of Microsoft Azure OpenAI for our workforce. With it, our
teams can securely tap into generative AI technology,
whilst safeguarding data and compliance considerations.
Some key use cases range from researching responses to
requests, generating pro-activity ideas, and searching our
knowledge bases to identifying key trends from member
feedback – ultimately helping Lifestyle Managers to work more
efficiently and identify service improvement opportunities
faster. These learnings are informing further developments
and enabling member-facing chat experience powered by
generative AI technology – fine-tuned with Ten’s proprietary
knowledge bases and unique proposition assets sourced
from our suppliers.
Our product and technology teams have weaved AI into their
daily routines and, with the use of GitHub Co-pilot, are seeing
increased efficiencies in their workflows. Our content team
has re-designed its workflows around content creation and
speed of translations.
(2022: 80%)
80%of Material Contracts with the Ten Digital Platform
59%average open rate of general emails
14.4mmember communications emails sent
(2022: 48%)
(2022: 11.5m)
↑ Ten’s Digital Platform
Strategic reportStrategic reportTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023 22
Key Performance Indicators
23
Key Performance Indicators
Each month, the Board assesses the performance of the Group based on the following financial and operational
key performance indicators (KPIs):
Net Revenue (£m)
£63.0m
Corporate revenue
Supplier revenue
45.8
5.5
40.3
44.2
3.3
40.9
46.8
5.7
41.1
34.7
2.8
31.9
63.0
7.4
55.6
Adjusted EBITDA
(£m)
Adjusted EBITDA
Margin (%)
Profit/(Loss)
before tax (£m)
£12.0m
19.1%
£0.9m
12.0
19.1
(7.3)
(5.9)
(5.5)
(3.8)
0.9
12.8
10.8
10.4
4.8
4.4
4.9
Active Members (’000)
Material Contracts
Net cash (£m)
353k
28
£3.7m
353
275
24
23
25
28
28
12.3
226
203
192
10.0
6.7
3.7
3.2
2019
2020
2021
2022 2023
2020
2021
2022
2023
2020
2021
2022
2023
2019
2020
2021
2022 2023
2019
2020
2021
2022
2023
2019
2020
2021
2022
2023
2019
2020
2021
2022
2023
Description
Net Revenue from our
corporate clients was up 35%
to £55.6m due to the
increase in member activity
(paid for by our corporate
clients) and revenue from
new contracts. Net Revenue
from our suppliers, mainly
commission related to our
members’ travel, was up 30%
to £7.4m
Definition
Net Revenue includes the
direct cost of sales relating to
certain member transactions
managed by the Group
Link to the Growth
Engine:
Description
A step-change in Adjusted
EBITDA to £12.0m, a 145%
improvement
Definition
Adjusted EBITDA is operating
profit/ (loss) before interest,
taxation, amortisation,
depreciation,
share-based payment
expense, and exceptional
items. It also excludes
National Insurance on share
options.
Link to the Growth
Engine:
Description
A step-change in Adjusted
EBITDA Margin to 19.1%
Description
Inflection point with PBT up
£4.7m to £0.9m.
Description
Active Members up 28% to 353k.
Description
Retained all Material Contracts for
fourth year running.
Description
Cash and cash equivalents of £8.2m
and net cash of £3.7m
Definition
Adjusted EBITDA margin is
Adjusted EBITDA as a
percentage of Net Revenue.
Link to the Growth
Engine:
Definition
Profit/(loss) before tax is
revenue less all operational
and non-operational costs,
excluding income tax
expenses.
Link to the Growth
Engine:
Definition
Cash and cash equivalents, reduced by
the aggregate of both current and
non-current borrowings.
Link to the Growth Engine:
Definition
Individuals who possess an eligible
product, employment, account, or card
with one of Ten’s corporate clients
become “Eligible Members”, with
access to Ten’s platform and service,
registered to the relevant corporate
client’s programme. Those who have
utilised the platform or service within
the past twelve months are considered
“Active Members”.
Link to the Growth Engine:
Definition
Ten categorises its corporate client
contracts based on the annualised
value paid, or expected to be paid, by
the corporate client for the provision of
concierge and related services by Ten
as: Small contracts (below £0.25m);
Medium contracts (between £0.25m
and £2m); Large contracts (between
£2m and £5m); and Extra Large
contracts (over £5m). This does not
include the revenue generated from
suppliers through the provision of
concierge services.
Medium, Large and Extra Large
contracts are collectively Ten’s
“Material Contracts”.
Link to the Growth Engine:
Link to the Growth Engine:
More investment from corporate
clients
Reinvestment in technology,
content, and supplier partnerships
Increased cash generation
and margins
Improvement in speed and
efficiency
Building a strong
member-led proposition
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24
Responsible Business
25
Jules Pancholi
Independent Non-Executive Chairman
Our steadfast commitment to prioritising ESG initiatives
as outlined in our Sustainable Business Strategy persisted
throughout the year, and I thank all our colleagues who
contribute to positive impacts daily. In this report, we’ve
further refined our reporting on the Group’s diversity,
inclusion, and carbon footprint. Notably, our successful
attainment of B Corp certification marks a milestone,
promising widespread positive impacts across our
entire business.
The ongoing success of Ten’s Global Leadership
Programme, in conjunction with our DEI Programme,
ensures the development of future leaders. We remain
dedicated to optimising the practices of our content,
lifestyle, and supplier management teams to empower
our supplier partners, providing our members with more
sustainable choices that positively influence all our lives.”
Jules Pancholi
Chair of the ESG Working Group
→ Belmond Le Manoir, a member favourite
destination for Ten hosted events
Dedicated to growing
a sustainable business
Our Sustainable Business
Strategy has three priorities:
1.
Greater transparency that informs
better, data-driven decision making
2.
Change internal operations and
behaviours to make a positive impact
3.
Actively encourage our supplier
partners and members to make
more sustainable choices
Ten is actively striving to become the
world’s most trusted service by growing a
responsible business through the cultivation
of a conscientious, member-centric, and
innovative business model. Recognising the
significance of Environmental, Social, and
Governance (ESG) dynamics across our
three sustainability pillars is pivotal to
achieving this overarching goal.
1.
Governance for sustainable
growth
2.
Caring for our people and
communities
3.
Reducing our impact on the
environment
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Responsible Business continued
27
1. Governance for
sustainable growth
Sustainable Business Strategy
Developed by the Group’s ESG Working
Group, our Sustainable Business Strategy
systematically evaluates the most impactful
ESG issues, drawing insights from
consultations with various functions and
regions across the Group. Ongoing dialogues
with investors and other stakeholders play a
crucial role in refining our priorities, and
additional details about the Board’s
interactions with stakeholders can be found
on pages 38 and 39.
The ESG Working Group periodically updates
the Audit and Risk Committee and the Board on
its work, maintaining a transparent line of
communication. The Board, in turn, retains
oversight of the Sustainable Business Strategy,
conducting assessments of relevant ESG risks
and opportunities. This oversight ensures that
the principles of governance are seamlessly
integrated into the core fabric of our
business operations.
→ andBeyond Vira Vira, Chile’s Lake District
B Corp certification
This year, we achieved a significant milestone by
obtaining B Corp certification in May 2023 following a
rigorous assessment process. Ten earned an overall
score of 82.2. The median score for businesses which
complete the assessment is 50.9.
B Corp certification underlines Ten’s commitment to
responsible business practices, aligning it with a global
community of over 60,000 organisations dedicated to
making a positive societal and environmental impact,
including Patagonia, Abel & Cole, Aesop, Hawksmoor,
Berghaus, Learn Amp, and Coutts Bank. B Corp
certification recognises companies that maintain
the highest standards in social and environmental
performance, transparency, and legal accountability,
emphasising a balance between profitability and purpose.
The award of B Corp certification is expected to yield
significant advantages for Ten and its stakeholders,
including the validation of its ESG credentials to
shareholders, members, suppliers, and other
stakeholders. It will also help attract and retain mission-
driven individuals, reinforcing Ten’s position as a leader
in responsible business practices and aligning with the
evolving focus on ESG priorities among corporate clients
and individual members.
As a B Corp, Ten will continue to complete
comprehensive annual B Impact Assessments, evaluating
its social and environmental impact across various facets
of its operations. The commitment is not a one-time
event but an ongoing one, requiring recertification every
three years.
Certification followed a shareholder resolution that was
passed in July 2022 with 95% of votes cast in favour of
amending the Group’s Articles of Association. This
adoption of B Corp’s legal requirement commits
Directors to a “triple bottom line” approach in building
a sustainable business.
82.2
B Corp Score
Board role, independence, and diversity
The Board assumes ultimate responsibility for defining
the Group’s strategy for long-term success and bears
ultimate responsibility for overseeing management,
governance, controls, risk management, direction, and
performance, as detailed on pages 40 to 43.
Since the end of the period, on 8 November 2023, Jules
Pancholi, Non-Executive Chairman was appointed
Chairman of the Board following Bruce Weatherill
stepping down from the Board due to ill health. At the
same time, Edward Knapp and Carolyn Jameson were
appointed as Non-Executive Directors. The Board has a
collective wealth of industry, financial, and public market
experience, reflecting a diverse array of skillsets and
capabilities. The Audit & Risk as well as Remuneration
Committees are exclusively composed of Non-Executive
Directors, as detailed on pages 60 and 62.
Business ethics and compliance
Building a culture based on responsibility, sustainability
and integrity is essential to long-term success as
a Group. The Group’s relevant policies are reviewed
annually and are incorporated into periodic training
and evaluation.
Whistleblowing Policy
The Group’s Whistleblowing Policy sets out the process
by which any employee of the Group may, in confidence,
report concerns about possible wrongdoings in financial
reporting or other matters to the Whistleblowing Officer.
Anti-bribery and Corruption Policy
The Group’s Anti-bribery and Corruption Policy applies
to all employees of the Group and sets out the Group’s
zero-tolerance position on bribery and corruption as
well as providing guidance on how to recognise and
deal with bribery and corruption issues and the
potential consequences.
Modern Slavery Policy
The Group has a zero-tolerance approach to modern
slavery anywhere in its supply chain and a full copy of
its policy is available on its website.
Diversity as of the date of this report:
50%Independence
38%Female representation
13%Ethnic diversity
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Responsible Business continued
29
2. Caring for our people
and communities
data produced presents statistical challenges. Given the
voluntary nature of the survey and the anonymous nature of
respondents’ feedback, it’s important to note that changes in
individual respondents between years can introduce
variations in the sample set when comparing results from
one year to another. We are looking at opportunities to better
facilitate these surveys as well as managing demographic
data through our HR function.
In the survey, we saw a slight reduction in the racial and
ethnic diversity of our senior management in 2023 compared
to 2022. We are dedicated to enhancing the diversity of our
leadership team in the future and are bolstering our internal
DEI efforts, specifically allocating more dedicated resource to
our DEI work. The cross-functional collaboration implemented
ensures that our hiring, onboarding, and ongoing development
processes actively contribute to a more diverse leadership
cadre. Key programmes including our Mentor Network and
Coaching Accelerator aim to provide under-represented
groups within our organisation with valuable support and
opportunities for growth and development, giving them
clear, compelling career paths within the business.
We have also identified an opportunity to enhance
the internal communication of our educational
programmes and support for employees,
enabling us to more effectively engage
with them and better understand their
evolving perspectives.
Our ambition is to be a market-leading place to
work, underpinned by a culture where our
people feel valued and able to positively impact
our members’ lives and creating value for our
corporate clients as well as enriching the lives
of our colleagues and their communities. We
remain focused on becoming an employer of
choice and are proud of our diverse culture and
inclusive workplaces, which are both critical in
achieving this goal.
Diversity, equity, and Inclusion (DEI) strategy
For the last five years we have made diversity, equity, and
inclusion (DEI) a cornerstone of our strategy and see it as
fundamental to the Group’s success over the long term. Our
diverse and talented team is based in over 20 countries, and
this brings a wealth of perspectives and experiences that
adds value to our service.
Our Global Council for DEI operates as a task force inside the
business and works through four clear strategic pillars.
Our DEI Programme agenda has four clear strategic focus areas:
Transparency
Increase the visibility of Ten’s commitment to and work on DEI.
Education
Increase training and support on DEI issues.
Promotion
Attract and retain a workforce that reflects local
demographics, and increase the diversity in management roles.
Engagement
Improve engagement with DEI issues through events
and content.
These drive a focus and commitment to make the Group’s
overall work one that is built on inclusivity and empowers our
employees to have a true, authentic voice in the decisions
within the business. Work continues as well to ensure we
oppose discrimination of all types and create equality
of opportunity across the business.
Racial and ethnic diversity
Ten has made significant efforts through its DEI programming
in 2023 to celebrate and strengthen gender diversity, religious
inclusion, and ethnic representation across our business. We
value feedback and see it as one of the most effective ways
to involve our people and engage with them. In 2022, we
launched our annual DEI survey programme, a voluntary
opportunity for employees to feedback on our DEI work and
provide answers to demographic questions. Whilst the
feedback is highly valued and is used to inform the
development of the overall DEI strategy, the demographic
Racial and Ethnic Diversity
Asian
Black or African
Hispanic/Latino
White
Mixed/other
2023
2022
2023
2022
2023
2022
2023
2022
2023
2022
Senior management
16%
21%
4%
6%
Total workforce
20%
20%
14%
10%
6%
8%
3%
6%
66%
58%
7%
12%
46%
44%
12%
20%
Gender Diversity
Our survey results also show that women are well
represented within the workforce across all regions and at
senior management level. We remain committed to ensuring
that women are supported to attain senior positions
throughout the business and in all regions, despite the
slight reduction in representation since last year.
Representation of women
Target
2023
Senior management
50%
44%
2022
47%
Total workforce
60%
65%
60%
Developing leaders
The Group is proud of its track record of developing
talent. This is enabled by programmes such as the Global
Leadership Programme, a twelve-month internal
development programme aimed at developing the
Group’s future leaders and personal development skills,
graduates from which have secured promotions within
the Group and now mentor staff and interns. Ten’s global
mentor network is another programme that focuses on
developing high potential leaders through mentorship,
and our coaching accelerator offers coaching to all staff,
be it in a virtual or face to face format. This programme
also equips managers with foundational coaching skills
which can be applied in their everyday work and team
management. In all cases, the specific needs of our
people, including any disabilities, are carefully considered
during the hiring processes, in role and throughout
training and development.
We are also pleased that our internship programme in
South Africa and Switzerland continued this year with
eleven interns joining the business. This programme to offer
opportunities to emerging talent has been very successful,
and ten of the twelve interns from 2022 have been retained
in the business and are in full-time positions.
Investing in the working environment
Policies and procedures comply with relevant local safety,
health, and welfare at work legislation, as appropriate.
The Group continues to invest in quality, well-situated
office spaces fitted to high standards, globally, in order
to provide the best working environment.
Flexible working and working from home measures have
continued where appropriate, and we have relocated or
reconfigured office spaces to best suit local needs. When
our people are working from home, we conduct
workstation assessments to ensure that health
standards are met.
Ethical supply chains
Maintaining trusted, sustainable partnerships with robust
supplier partners is integral to the Group’s operations
and member proposition. We are therefore expanding our
supplier partner due diligence and audit programmes to
ensure they understand our needs and the needs of our
corporate clients as well as our members. We will also
remain committed to fair payment terms, practices,
policies, and performance.
This year, the Group has published its Supplier Code of
Conduct, which outlines the minimum standards and
transparency expected from all supplier partners and
requires supplier partners to have processes in place to
maintain these standards and be able to provide evidence
if required. A collaborative approach is being taken to
implement and test against the Code, with contractual
requirements being incorporated as standard.
Treating data with respect
Data is at the heart of our business and our members
and corporate clients trust us to treat their data with
care and respect. We therefore take data privacy rights
and data protection seriously and have in place robust
data protection procedures to ensure it is compliant with
relevant regulations such as the General Data Protection
Regulation (GDPR) in the UK and European Union, the
California Consumer Privacy Act (CCPA) in the US, and
the Brazil General Data Protection Law (LGPD).
The information security and compliance teams
undertake regular audits and receive regular training, and
the Group maintains robust processes to ensure the
proper processing of personal data and mitigate the risk
of cybercrime.
Supporting our communities
Following the first-year success of Ten’s volunteering
programme, granting employees paid leave to volunteer
for a charity they have chosen, we have seen increased
take up in its second year and a higher number of full
teams participating. The range of community causes is
extensive, and acts of service have included the
collection and distribution of clothing and essentials for a
refuge in Mumbai, stewarding at the Berlin Special
Olympics, environmental conservation in the UK,
compering an auction for LGBTQ charities in New York,
and offering hands-on support at animal rescue centres
in Hong Kong.
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Responsible Business continued
31
3. Reducing our impact
on the environment
Ten’s operations are low
impact and low carbon
intensive, but we continue
to look for ways
to minimise the
environmental impact of
the Group on the
environment, as well as
actively encouraging
supplier partners and
members to make more
sustainable choices, as part
of the Group’s Sustainable
Business Strategy.
Carbon emissions
We remain committed to reducing the emissions from
Ten’s own business operations. As a digitally enabled
service business, our main environmental impact is the
carbon footprint generated from our own business
operations, with 88% (2022: 82%) of our footprint made
up of Scope 3 greenhouse gas emissions, particularly
from our staff’s air travel and working from home, with
Scope 2 emissions from our direct operations making up
the remaining 12% (2022: 18%).
We use intensity ratios based on the tonnes of CO2e
and the megawatt hours per total £m of Net Revenue
to monitor our global energy efficiency performance
and carbon footprint over time. Based on like-for-like
data available, the ratio of energy usage and carbon
emissions per total £m of Net Revenue continues to fall
year on year.
We have adopted operational practices to conserve
energy, water, and other resources, reducing waste
including through the use of specialist recyclers and
refurbishing IT equipment. We have also opted for cloud
service providers that use renewable energy to power the
service. Energy and green building rating scores are
considered when selecting office locations, and we work
with landlords to assess energy providers, energy
efficiency, and air quality as well as identifying ways of
reducing energy usage (e.g. installing light sensors and
water reduction faucets). The Group also makes use of
online collaboration tools to reduce the need for regional
meetings and operates flexible working practices where
possible, reducing the environmental impact of business
travel and commuting. Where possible, we have increased
the number of bicycle parking spaces available to staff.
We continue to expand the reporting of Ten’s energy
consumption and greenhouse gas (GHG) emissions under
the Streamlined Energy and Carbon Reporting (SECR)
framework to better identify opportunities to reduce our
Scope 1, 2, and 3 carbon emissions, as set out on pages
36 and 37. This year, we have included all offices,
whether leased or serviced, in Scope 2 analysis and, for
the first time, we have included energy consumption
from major data centres and cloud providers within
Scope 3. We also recognise that emissions are generated
by employees whilst working from home, so we have
included an estimate of those emissions within Scope 3.
Member activities
Ten has the ability to positively shape the behaviour of
its members by offering sustainable lifestyle choices
and aiding them in understanding how to achieve their
personal carbon footprint goals. This becomes
particularly crucial among wealthier groups, as individual
shifts away from carbon-intensive travel and dietary
habits are essential to averting dangerous levels of
global heating.
The ESG Working Committee collaborates closely with
Ten’s proposition, digital, and content teams to pinpoint
three strategic areas aimed at promoting sustainable
choices within our membership.
Strengthen Ten’s sustainable proposition
to deliver member choice
Enhance offerings to provide members with a broader
array of sustainable choices.
Enhance visibility of choice across
all channels
Increase awareness and visibility of sustainable choices
through all communication channels.
Facilitate member philanthropic activities
in partnership with our corporate clients
Collaborate with corporate clients, working towards
enabling and promoting philanthropic initiatives among
our members.
This collaborative effort has led to partnerships with more
sustainable retail brands, resorts, and events, fostering
diversity and fundraising initiatives. These collaborations
are extensively highlighted across our editorial content and
tailored member communications, including the publication
of over 56 articles focused on sustainability topics.
To ensure environmental and sustainability standards,
Ten’s Supplier Code of Conduct outlines the minimum
expectations from all supplier partners. The approach is
collaborative, aiming to implement and assess the
adoption of these standards across our supply chain.
→ Le Pavillion, New York, part
of Ten’s dining collection
TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023
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Responsible Business continued
33
Climate-related Financial Disclosures
Regulations 2022 Statement
We recognise the climate change risks
impacting the global environment and Ten
actively supports the worldwide transition
towards a sustainable, low-carbon economy,
with a clear commitment to progressing
towards net zero.
For the third year, we present climate-related disclosures
in accordance with the Companies (Strategic Report)
(Climate-related Financial Disclosure) Regulations 2022,
aligning with the requirements of the Task Force on
Climate-related Financial Disclosures (TCFD).
Ten fully endorses the TCFD recommendations and is
dedicated to their implementation, ensuring comprehensive
information is available to all stakeholders regarding our
exposure to climate-related risks and opportunities in order
to make well-informed decisions.
Throughout this year, we have built on the foundations laid in
prior years to further enhance our understanding of climate-
related impacts and necessary disclosures relevant to the
Group. We’ve diligently worked on establishing ambitious yet
achievable targets for the Group and formalised our internal
reporting structure for climate-related issues.
Category
Governance
Description
The Group’s governance around climate-related risks and opportunities.
a. Describe the Board’s oversight of
climate-related risks and opportunities
b. Describe management’s role in
assessing and managing climate-related
risks and opportunities
The Board maintains oversight of the Group’s Sustainable Business Strategy,
which identifies climate-related risks and opportunities identified by the ESG
Working Group, chaired by Jules Pancholi, Non-Executive Chairman. The ESG
Working Group periodically updates the Audit and Risk Committee to consider
ESG risks, including climate-related risks, and its mitigation plans. Material risks
specific to climate change are monitored on the Group’s risk register, subject to
regular scrutiny by both the Audit and Risk Committee and Board.
The ESG Working Group is made up of senior representatives from the operations,
proposition, people, legal, and project management teams and plays a dynamic
role in scrutinising potential risks and opportunities across all relevant geographic
and functional areas of the business. Emerging risks or opportunities are
deliberated during regular management meetings where suitable action or
mitigation plans are agreed. These are periodically presented to the Audit and Risk
Committee and the Board. Climate considerations are embedded in relevant
strategic and operational risk management processes.
Strategy
The actual and potential impacts of climate-related risks and opportunities on the Group’s businesses, strategy, and
financial planning.
a. Describe the climate-related risks and
opportunities the Group has identified
over the short, medium, and long term
The tables below summarise the Group’s analysis of the key climate-related risks
and opportunities over the short (pre-2030), medium (2030–40) and long (post-
2040) time periods. These opportunities and risks will continue to be reviewed
and updated in response to the evolving landscape and as our climate-related
strategy develops further.
b. Describe the impact of climate-related
risks and opportunities on the
Group’s businesses, strategy, and
financial planning
The tables below summarise the impact of climate-related risks and
opportunities on the Group. As a low-impact digitally enabled service business
committed to reducing carbon generated from our own business operations,
climate-related considerations are embedded in relevant strategic and operational
risk management processes.
c. Describe the resilience of the Group’s
strategy, taking into consideration
different climate-related scenarios,
including a 2°C or lower scenario
As identified in the tables below, the Group is resilient to most climate-related
scenarios, including a 2°C or lower scenario. Climate-related factors introduce
certain risks and uncertainties to the business; the Group has proved to be highly
adaptable to operational and market challenges so the Board is confident that it
will be able to adapt the business model and activities, if necessary, to mitigate
any potential risks.
↑ Ten opens the London Stock Exchange as the first AIM-listed business to achieve B Corp certification
Category
Description
Risk management
How the Group identifies, assesses, and manages climate-related risks.
a. Describe the Group’s processes for
identifying, assessing and managing
climate-related risks
The Board, and the Audit and Risk Committee oversee the Group’s risk
management and internal control framework. The ESG Working Group identifies
emerging climate-related risks and formulates mitigation plans. Material risks are
included on the Group’s risk register, ensuring centralised documentation, review,
and management of business risks. This process aims to establish appropriate
mitigating measures and management plans for all identified risks.
b. Describe how processes for
identifying, assessing, and managing
climate-related risks are integrated into
the Group’s overall risk management
Climate-related risks are considered in all relevant business decisions. To foster a
culture of ongoing consideration for climate and environmental issues throughout
our business, members of the ESG Committee are tasked with embedding the
Group’s Sustainable Business Strategy within the business, through engaging the
Senior Leadership Team.
Metrics and targets
The metrics and targets used to assess and manage relevant climate-related risks and opportunities.
a. Describe the metrics used by the Group
to assess climate-related risks and
opportunities in line with its strategy
and risk management process
As a low-impact digitally enabled service business committed to reducing carbon
generated from our own business operations, the Group measures the energy and
greenhouse gas (GHG) emissions from global business activities involving the
purchase of electricity for all offices, business mileage and air travel, from data
centres and key cloud service providers, and related to our employees working
remotely from home.
The Group’s Scope 1, Scope 2 and Scope 3 GHG emissions are disclosed on
pages 36 and 37.
b. Describe the targets used by the Group
to manage climate-related risks and
opportunities and performance
against targets
As a growth business, the Group used intensity ratios based on the tonnes of CO2e
and the megawatt hours per total £m of Net Revenue to monitor our global
energy efficiency performance and carbon footprint over time. The Group is
committed to reducing the ratio of energy usage and carbon emissions per total
£m of Net Revenue based on like-for-like data available.
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Responsible Business continued
35
Climate scenario analysis
We recognise the importance of identifying and assessing the potential implications of a range of plausible future climate
scenarios in order for the Group to effectively plan for and manage any risks that climate change poses to our business, as well
as the opportunities that climate change mitigation and adaptation may create.
The scenario analysis below outlines risks and opportunities related to climate change over the short (pre-2030), medium
(2030–40) and long (post-2040) time periods and across the following two climate scenarios:
▪ Scenario 1: “High Carbon” scenario (>3°C) - “the bad scenario” in which greenhouse gas emissions reach increasingly
destructive levels, leading to significant physical impacts from climate change.
▪ Scenario 2: “Low-Carbon” scenario (<2°C) – “the better scenario”, in which global temperature rise and greenhouse gas
emissions are vigorously mitigated. However, in this scenario transitional risks persist.
Table one: Climate change-related risks and opportunities
The tables below summarise the risks and opportunities identified as a result of the impacts of climate change on the business,
as well as the maturity of our assessment (on a scale of 1 to 3):
Risk/opportunity
Maturity of
assessment
Climate change
regulations
2
Product and service
adaptation
2
Investor and
corporate client
sentiment
2
Carbon taxation
2
Overview of risk/opportunity
Business response
Risk: Changes in laws or regulatory
interpretations may impact our operations,
leading to potential penalties for
non-compliance and increased operating
costs to meet regulatory obligations.
Stringent climate reporting requirements
could also elevate expenses related
to emissions tracking, reporting,
and verification.
Risk: Revenue loss if the Group fails to
adapt in the face of increasing awareness
for climate-friendly services and products.
Opportunity: If the Group adapts to meet
potential increase in climate-related
demand, it could present an opportunity
for revenue growth.
Risk: Investment loss if the Group fails
to meet increasing stakeholder and
investor expectations on climate action
and disclosures.
Opportunity: Greater investment from
stakeholders and investors as a result of
a robust response to the climate agenda.
Actively track regulatory and industry
changes, seeking legal and industry expertise
when necessary. ESG Working Group
addresses new climate compliance
obligations. Our governance processes are
designed to prevent any misstatements in
external reporting.
Actively developing a climate conscious
product proposition within the Group’s
adaptable business model to support
members through the low-carbon transition.
Innovating to capitalise on opportunities and
aiding members and corporate clients in
adapting to and mitigating climate change
effects. Increased corporate client enquiries,
particularly from financial institutions,
indicate a demand for product alignment
with climate strategies. Further details on
page 31.
Actively minimising our climate impact and
transparently disclosing our climate and
broader ESG performance through the
Annual Report, B Corp assessments, CDP,
and Integrum. This commitment is aimed at
sustaining our strong reputation with both
current and future investors.
Risk: Although our operations are not
emissions intensive, the implementation
of external carbon pricing could increase
operational expenses directly or indirectly
through higher supplier costs, mainly
related to energy.
The Group’s Sustainable Business Strategy
mitigates the risk of carbon pricing in our
operations and supply chain. Our supplier
engagement programme lessens exposure
to carbon taxation on purchased goods
and services.
Risk: Reduction in member activity as
a result of increased targeted carbon
taxation, especially in the travel industry.
The memberbase is less sensitive to price
increases than the wider population and
our member engagement strategy seeks to
provide low-carbon alternative.
Risk/opportunity
Maturity of
assessment
Rising temperatures
and energy demand
1
Extreme weather
conditions
Climate migration
1
1
Overview of risk/opportunity
Business response
Risk: Increased operational expenses, due
to heightened energy demand for running
our operations. This includes cooling for
data centres, particularly with the
potential rise in external temperatures.
Actively implementing energy efficiency
measures and transitioning to cloud-based
service providers to diminish our
cooling demands.
Risk: Disruption to product and service
offerings and demand for services as a
result of extreme weather events and
expense from property damage.
Robust business continuity plans in place to
maintain operations across 20 locations
globally and well-rehearsed
remote operations.
Risk: Volatile market environment due to
rapidly changing and unpredictable
weather and climate conditions.
Global service offering and operations will
enable adaptation to change as a result of
climate migration.
All assessments are still in progress. In the coming year we will continue to monitor and assess each risk as we are able to
better observe them.
Table two: Risks by climate scenario and time frame
The table below summarises the areas considered as part of our assessment of the potential risks of climate change on the
business and the expected financial impact each may have, using the following definitions:
Low Financial Impact: Minor fluctuations in revenue or expenses that have a limited effect on the company’s overall financial
stability and are easily manageable with existing resources.
Medium Financial Impact: Noticeable changes in revenue or expenses with a moderate impact on profit margins, requiring some
adjustments and strategic management.
High Financial Impact: Substantial fluctuations in revenue or expenses leading to a significant impact on profit margins,
demanding urgent and comprehensive financial strategies for recovery and sustainability.
Transition risks by climate scenario and time frame
Financial impact over time frame
Risk
Financial impact
Scenario
Pre-2030
2030–40
Post-2040
Climate change
regulations
Potential penalties for non-compliance
and increased operating costs to meet
regulatory obligations.
Low carbon
High
High carbon
High
Product and
service adaptation
Revenue loss if the Group fails to adapt
in the face of increasing awareness for
climate-friendly services and products.
Low carbon
Medium
High carbon
High
High
High
High
High
Investor and
corporate client
sentiment
Investment loss if the Group fails to meet
increasing stakeholder and investor
expectations on climate action and disclosures.
Low carbon
Medium
Medium
High carbon
Medium
High
High
High
High
High
High
High
Carbon taxation
Increased cost of products, services,
and partnerships.
Rising
temperatures and
energy demand
Increased cost of resources to fulfil
service demands.
Extreme weather
events
Decrease in demand for services as a result of
weather conditions.
Low carbon
Medium
Medium
Medium
High carbon
High
High
High
Low carbon
Low
Medium
Medium
High carbon
High
High
High
Low carbon
Low
Medium
Medium
High carbon
Low
Climate migration Societal-level change in consumer and market
Low carbon
Medium
behaviour as a result of climate change.
High carbon
High
High
High
High
High
High
High
Transition risks pose a substantial financial challenge if they are not adequately addressed in a timely manner. It will be critical
for Ten to meet the climate action expectations of members, corporate clients, investors, and consumers with deft execution of
its climate strategy.
Strategic reportStrategic reportTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023 36
Responsible Business continued
37
Climate scenario analysis continued
Table three: Opportunities by climate scenario and time frame
The table below summarises the potential climate-related opportunities identified as part of our assessment of the potential
impacts of climate change on the business.
Opportunities by climate scenario and time frame
Financial impact over time frame
Opportunity
Financial impact
Scenario
Pre-2030
2030–40
Post-2040
Product and
service adaptation
If the Group adapts to meet potential increase
in climate-related demand, it could presents
an opportunity for revenue growth.
Low carbon
Medium
High
High
High carbon
Medium
Medium
Medium
Investor and
corporate client
sentiment
Greater investment from stakeholders and
investors as a result of a robust response to
the climate agenda.
Low carbon
Medium
High
High
High carbon
Medium
Medium
Medium
Table 2: Annual changes in greenhouse gas (GHG) emissions and energy use (kWh) by Scope
Scope 1
Scope 2
Annual percentage change
in kilowatt hours of energy (%)
Annual percentage change in tonnes
of carbon dioxide equivalent (%)
2023
2022
2021
2020
2023
2022
2021
2020
—
—
—
—
—
—
—
—
a) UK electricity
(8%)
11%
(39%)
—
(11%)
20%
(44%)
—
b) Rest of world electricity
(excluding serviced offices)
(3%)
31%
c) Serviced offices electricity
(8%)
—
—
—
Carbon taxation
The memberbase are less sensitive to price
increases than the wider population and our
member engagement strategy seeks to provide
low-carbon alternative.
Low carbon
Medium
Medium
Medium
Scope 3
High carbon
Medium
Medium
Medium
a) UK refunded mileage
326%
216%
(98%)
Carbon emissions
The Group reports its Scope 1, 2, and 3 carbon emissions under the Streamlined Energy and Carbon Reporting (SECR)
framework for the fourth year running. These include energy and GHG emissions from global business activities involving the
purchase of electricity for all offices, business mileage and air travel, from data centres and key cloud service providers, and
related to our employees working remotely from home.
Tables 1 and 2 below show the energy and GHG emissions from these business activities in kWh and tCO2e and the percentage
change when compared to the prior year(s).
Table 3 below shows the Group’s selected intensity ratios by year, based on the tonnes of CO2e and the megawatt hours per
total £m of Net Revenue. These ratios are used to monitor our global energy efficiency performance and carbon footprint over
time. The analysis indicates that the Group’s intensity ratios have reduced year on year since 2020.
Table 1: Greenhouse gas (GHG) emissions and energy use (kWh) by Scope
Scope 1
Scope 2
Kilowatt hours of energy (kWh)
Tonnes of carbon dioxide
equivalent (tCO2e)
2023
2022
2021
2020
2023
2022
2021
2020
—
—
—
—
—
—
—
—
a) UK electricity
230,525
251,766
227,424
372,294
51.87
58.19
48.29
86.80
b) Rest of world electricity
(excluding serviced offices)
242,302
248,589
189,609
c) Serviced offices electricity
189,477
205,689
—
—
—
49.67
56.66
88.55
47.95
49.23
—
—
—
Scope 3
a) UK refunded mileage
14,509
3,408
1,077*
45,403*
2.81
0.66
0.20
8.78
b) Rest of world refunded mileage
37,017
26,915
9,929*
—
7.16
5.20
1.92
c) Global air travel
1,043,520
542,744
d) Data centres and key cloud providers
12,829
12,145
e) Remote working
4,223,387 3,303,066
—
—
—
—
201.80
104.96
—
—
2.48
2.35
816.72
638.75
—
—
—
—
—
—
—
Total emissions (Scope 1, 2 and 3)
5,993,566 4,594,322
428,039
417,697
1,180.46
916.00
138.96
95.58
* Scope 3 energy usage for prior years recalculated using UK government’s GHG Conversion Factors for Company Reporting (2021) for increased accuracy.
—
—
—
—
—
—
—
(12%)
(36%)
(3%)
—
—
—
326%
230%
(98%)
38%
171%
92%
6%
28%
—
—
—
—
—
—
—
—
—
—
—
—
—
—
b) Rest of world refunded mileage
38%
171%
c) Global air travel
d) Data centres and key cloud providers
e) Remote working
92%
6%
28%
—
—
—
—
—
—
—
Table 3: Intensity ratio per £m of Net Revenue (tCO2e/£m / MWh/£m)
Megawatt hours of energy per £m
of Net Revenue (MWh/£m)
Tonnes of carbon dioxide equivalent per £m
of Net Revenue (tCO2e/£m)
2023
2022
2021
2020
2023
2022
2021
2020
Scope 2 a) and Scope 3 a)
3.89
5.45
6.59
9.43
0.87
1.26
1.40
2.16
Scope 2 a) and b) and Scope 3 a) and b)
8.32
11.34
12.34
Scope 2 a) to e) and Scope 3 a) to c)
95.14
98.17
—
—
—
1.77
2.58
4.00
18.74
19.57
—
—
—
SECR methodology
The figures quoted in Scope 2 a) UK electricity include data from meter readings from the UK office only whereas Scope 2
b) Rest of world electricity (excluding serviced offices) includes data from meter readings or estimates from the Group’s
non-serviced offices and Scope 2 c) Serviced offices electricity is an estimate of electricity usage at the Group’s serviced offices.
The figures quoted in Scope 3 a) UK refunded mileage include refunded business mileage from the UK only whereas Scope 3
b) Rest of world includes refunded mileage from the rest of the world. Refunded business mileage has been classed as Scope 3
as Ten does not own the assets. We have restated prior year emissions from refunded mileage using up to date conversion
factors. Scope 3 c) Global air travel includes global air travel by employees during the period.
The figures quoted in Scope 3 d) Data centres and key cloud providers include data from three of the Group’s global data
centres and the use of Amazon Web Services.
The figure quoted in Scope 3 e) Remote working is an estimate of energy consumption by our staff when working from home
using EcoAct’s Homeworking and Commuting Tool.
Conversion factors used to calculate 2023 emissions and recalculate 2021 and 2022 emissions were taken from the UK
government’s GHG Conversion Factors for Company Reporting (2021) to calculate emissions for Scope 2 and 3. An average CO2e
factor has been applied to the refunded business mileage as individual private vehicle details have not been provided.
Strategic reportStrategic reportTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023 38
Stakeholder Engagement (S. 172)
39
How the Board
engages stakeholders
The Group has a number of stakeholders in
the business with sometimes differing needs,
all of which need to be understood by the
Board and fairly considered when making
decisions about the business that may have
an impact on them.
c)
the need to foster the Group’s business partnerships with
suppliers, customers and others;
d) the impact of the Group’s operations on the community
and the environment;
e) the desirability of the Group maintaining a reputation for
high standards of business conduct; and
f) the need to act fairly between members of the Group.
Under Section 172(1) of the Companies Act 2006, the directors
of a company have a duty to promote the success of the
company for the benefit of its shareholders and wider
stakeholders when making decisions. In doing so, the Board
has regard (amongst other matters) to:
a) the likely consequences of any decision in the long term;
b) the interests of the Group’s employees;
This year, Ten has become a certified B Corp, further
formalising the Board’s commitment to growing a sustainable
business and will have significant positive effects on the Group
and stakeholders, as further detailed on pages 38 and 39.
Here is a summary of how the Board engages with some of
the Group’s main stakeholder groups:
Shareholders
▪ The Board ensures open and meaningful dialogue with all shareholders,
▪ In-person, virtual, and hybrid shareholder meetings and investor
treating them fairly and equally.
events with good attendance and positive feedback.
▪ Regular engagement by the CEO and CFO with market analysts and
▪ Ongoing commitment to a range of attendance options and
institutional shareholders through individual meetings.
informative online content.
▪ Updates on shareholder engagement and analyst commentary received,
along with feedback from corporate brokers on investor perception.
Members
▪ Member engagement is a top priority, influencing every decision
▪ Continuous assessment of member satisfaction and feedback,
within the business.
including through NPS.
▪ Various channels, including content, eCRM, Ten Digital Platform, and
▪ Emphasis on anticipating and influencing members’ current and
Lifestyle Managers, are used to engage with members.
future lifestyle needs.
For more information about our member proposition see pages 14 to 17.
Corporate clients
▪ Proactive engagement with corporate clients is crucial for business
▪ Detailed updates on client engagement provided to the Board by
growth and revenue.
the Client Services Director.
▪ Senior management and the corporate client services team
maintain regular communication with clients.
▪ CEO and selected Board members regularly meet with existing
and potential corporate clients to strengthen relationships.
For more information about our corporate clients, see pages 18 and 19.
Employees
▪ Employees, spread globally, are integral to providing high-quality
▪ Annual employee satisfaction monitoring with actionable steps
and innovative services.
reported to the Board.
▪ Various methods, including the OKR goal-setting framework,
ensure employee feedback informs the business direction.
For more information about our commitment to responsible business,
see pages 24 to 29.
Strategic supplier partners
▪ Strong relationships with strategic supplier partners contribute
to delivering value to members.
▪ Engagement with IT, technology, payment services, and telephony
providers for operational efficiencies.
▪ Proposition specialists leverage combined buying power to
enhance service proposition.
▪ Updates on key strategic partners provided to the Board, along
with approval of capital expenditure through a sustainable
procurement process.
▪ Commitment to high standards and prompt invoice payment.
For more information about our supplier partnerships, see pages 14 to 17.
The disclosures set out in the table below are some examples of how the Board has had regard to the matters set out in
Section 172(1)(a) to (f) when discharging its Section 172 duties and the effect of that on certain decisions taken by it and how the
Board seeks to ensure effective and continuous engagement with its stakeholders.
Board decision
Stakeholders affected
Strategic, operational, financial, and Section 172 considerations
Approval of the Group’s budget,
including the adjustments to
headcount and continued
investment in the Group’s
proprietary technology,
communications, and content
Members
Shareholders
Corporate clients
Employees
Strategic supplier partners
▪ Maintain the Group’s competitive advantage
▪ Improve the member proposition and increase efficiencies through
advancements in digitalisation, which drives profitability
▪ Group cash and working capital requirements
Continuous collaboration with corporate clients and member feedback guides
investment decisions, while employee input is considered in establishing
operational budgets.
Appointment of a new
Executive Director
Members
Shareholders
Corporate clients
Employees
▪ Ensure alignment with the Company’s strategic goals
▪ Assessed industry expertise and leadership qualities
▪ Assess past roles for operational expertise
▪ Consider collaboration and execution skills
▪ Consider history of contributing to revenue growth
Application for
B Corp certification
Members
Shareholders
Corporate clients
Employees
Strategic supplier partners
The ESG Working Group’s
recommendations, including
the expansion of the Group’s
TCFD and SECR monitoring
and climate transition planning
Members
Shareholders
Corporate clients
Employees
Strategic supplier partners
Environment
▪ Evaluate alignment with succession planning and legal compliance
As part of the succession planning process, the Nomination Committee engages
with shareholders and stakeholders to understand the Board’s demands and
determine the optimal skill mix needed.
▪ Align with the rising ESG priorities of Ten’s existing and prospective
corporate clients
▪ Demonstrate Ten’s ESG credentials to existing and prospective shareholders,
members, supplier partners and other stakeholders
▪ A competitive advantage as a leader in responsible business practices
▪ Help attract and retain people who share Ten’s values and want to further
the Group’s mission
The Board engaged institutional shareholders, corporate clients, employees,
and supplier partners throughout the B Corp application process, receiving
overwhelming support. Shareholders voted in favour of amending Ten’s Articles
to prepare for certification.
▪ Drive the Group towards its ambition to reduce its direct and indirect
impacts on the environment
▪ Communicate to investors how we manage the challenges and opportunities
of climate change
▪ Identify risks and opportunities likely to arise as a result of global warming
▪ Regulatory and environmental compliance
The ESG Working Group engages institutional shareholders when assessing
resources to monitor and plan for climate changes, considering potential
effects on employees and other stakeholders.
Invoice financing facility and
other debt
Shareholders
▪ Group cash and working capital requirements
Corporate clients
▪ Operational requirements of expanding existing and launching new corporate
client programmes
▪ Legal and compliance requirements for related party transactions
▪ Whether the terms of the related party loan were fair and reasonable as
far as the shareholders were concerned
The Audit and Risk Committee, along with the Board, closely oversees the
Group’s financial performance against forecasts and prudently manages working
capital to ensure robust financial management for stakeholders’ benefit.
Strategic reportStrategic reportTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023 40
Risk Management
41
Managing our risk
The Board considers the risks set out below to be the principal risks to the Group’s business.
The risks facing the Group are monitored and mitigated using a risk management and internal
control framework, as further described on page 59 of the Corporate Governance Statement
and page 61 of the Audit and Risk Committee Report.
The Board recognises that the nature and scope of risks can change and there may be other risks to which the Group is
exposed so the list is not intended to be exhaustive.
Description
Mitigation strategies
Change in 2023
Finance/macroeconomic
Financial resources
Financial Management: Risk
of hindering future growth due to
inadequate financial management.
Cost Escalation or Revenue Reduction:
Threat of reduced profitability and
insufficient cash reserves.
Working Capital Shortfall: Potential
cash inadequacy to meet crucial
working capital requirements.
Incorrect Tax Payments: Risk of
penalties due to inaccuracies in tax
payments.
Foreign Exchange Exposure:
Vulnerability to losses from currency
fluctuations.
Control Failure or Fraud: Risks
associated with potential financial
losses due to control failures or
fraudulent activities.
Robust Financial Planning: The Group’s adept
finance team oversees a responsive financial
planning process, facilitating accurate
forecasts of ongoing liquidity requirements.
Debt Increased to Support Working
Capital: The Group raised additional
debt to fund working capital cash flow
requirements.
Prudent Cash Management: Implementation
of prudent cash management, including
securing debt, to sustain working capital
requirements.
Invoice Financing Facility Initiated:
An invoice financing facility was
established with the Group’s bank
during the period.
External Professional Expertise: Utilisation of
external professional expertise for tax and
other specialised areas to ensure accuracy
and compliance.
Robust Financial Systems: Deployment of
robust financial systems to strengthen
controls and reporting, allowing for continual
review and oversight.
Foreign Currency Monitoring: Active
monitoring of foreign currency sensitivities
and leveraging natural hedging strategies
to mitigate risks associated with
currency fluctuations.
Enhancement of Back-Office
Functions: Financial and other
back-office functions were developed,
coupled with the implementation of
advanced financial systems to
augment capacity.
Control Framework Strengthened:
Ongoing efforts to review and
enhance the control framework
included the establishment of
standard operating procedures.
Global events, and global economic and political factors
External Event Risks: The re-emergence
of travel restrictions, the ongoing war
in Ukraine, the Israel-Hamas war, and
other geopolitical events pose potential
threats to member activity and
revenue. Vigilance and adaptive
strategies are crucial to navigate
uncertainties arising from
these external factors.
Economic Downturn and Inflation:
A general economic downturn and
the cost-of-living crisis, marked by
inflation, introduce challenges.
Proactive measures, such as robust
financial planning and cost
management, are essential to mitigate
the impact of economic uncertainties
on the organisation’s financial health.
Flexibility and Tailoring: Ten adapts working
practices and member propositions to
lifestyle needs and corporate client
demands, effectively managing demand and
revenue in challenging scenarios.
Business Resilience and Adaptability:
Despite minimal impact from
COVID-19 this year, the business
maintains preparedness to adapt to
potential effects of geopolitical events.
Leadership Oversight and Responsive Pricing:
The Senior Leadership Team and the Board
vigilantly monitor regional macroeconomic
changes, adjusting pricing structures to
navigate the evolving economic environment
and external cost pressures.
Inflation and Cost Challenges: Rising
regional inflation and cost of living
pressures have escalated operational
costs, prompting necessary price
adjustments with corporate clients
throughout the year. The business
demonstrates adaptability in response
to economic challenges to maintain
operational stability.
Description
Mitigation strategies
Change in 2023
Finance/macroeconomic continued
Regulatory and compliance
Compliance With Diverse regulations:
The business faces potential risks
related to non-compliance with a range
of regulatory standards, encompassing
travel, data protection, privacy,
employment law, tax, financial
regulations, and consumer law.
Consequences of Non-Compliance:
Non-compliance may result in potential
fines, penalties, or legal proceedings,
posing financial and operational risks.
Comprehensive Oversight: Legal, compliance,
finance, and HR teams closely monitor
industry-specific and local regulations,
seeking external advice as needed.
Data Protection Priority: The Group maintains
robust GDPR compliance procedures,
ensuring the protection of sensitive data.
Policy Adherence and Training: Group policies
are consistently upheld, with ongoing training
to foster a culture of compliance.
Proactive Client Audits: Regular client, PCI
DSS and SOC Type 2 audits ensure business
practices align with regulatory and
contractual obligations.
Internal Policy Adherence: Failure to
comply with internal policies and
procedures poses a risk of financial
losses and operational disruptions.
Reputational Impact: Regulatory
breaches carry the risk of adverse
publicity, potentially impacting revenue
growth and profitability as customers
and stakeholders may react negatively
to perceived non-compliance.
Environment, Social and Governance (ESG)
ESG Ambitions: Failure to meet ESG
ambitions may impact the Group’s
growth and reputation.
Climatic Risks: Climatic risks, such as
natural disasters and changes in legal
frameworks, pose challenges to supply
chains and member behaviours.
ESG Working Group Leadership: The ESG
Working Group, reporting to the Board, and
the Audit and Risk Committee, formulates
and implements the Group’s Sustainable
Business Strategy, emphasising transparency
and positive operational changes.
B Corp Certification: The Group applied
for B Corp certification to formalise its
commitment to sustainable business
practices and align with rising ESG priorities.
Stable Global Footprint: The Group’s
global footprint remained largely
unchanged throughout the period.
Compliance: No compliance breaches
were identified in 2023, indicating a
commitment to maintaining regulatory
standards.
Enhanced Data Privacy Measures: Data
privacy arrangements were updated,
with revisions to the Group’s Data
Processing Agreements and
International Data Transfer
Agreements, showcasing a proactive
approach to safeguarding data.
B Corp Certification: The Group
successfully secured B Corp
certification, affirming its commitment
to sustainable business practices.
Global DEI Programme Expansion:
The Global Diversity, Equity, and
Inclusion Council expanded its
DEI Programme, reflecting a
commitment to fostering diversity,
equity, and inclusion.
Enhanced Monitoring and Disclosure:
The Group enhanced monitoring and
disclosure of DEI and carbon
emissions, showcasing a dedication to
transparency and accountability.
Reduced Energy Usage and Carbon
Emissions: The Group achieved a
reduction in the ratio of energy usage
and carbon emissions per total £m
of Net Revenue, demonstrating
progress towards environmental
sustainability goals.
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Risk Management continued
43
Description
TECHNOLOGY
Mitigation strategies
Change in 2023
Digital strategy management and changes
Digital Imperative: The Group’s market
share and competitive advantage
heavily depend on its digital strategy,
particularly the performance of the
proprietary Ten Digital Platform,
TenMAID, and other digital elements.
Failure or underperformance could
lead to operational disruption,
regulatory fines, and contractual risks.
Continuous Digital Strategy Investment:
Sustained investment in the Group’s
digital strategy to ensure future
business performance.
Board Commitment to IT Investment: The
Board exhibits ongoing commitment to IT
investment, reinforcing operational efficiency
and data management while enhancing
cybersecurity defences.
Robust Back-Up and Recovery Protocols:
Implementation of robust back-up and
recovery processes and procedures to
minimise service disruption risks.
Data security and cybersecurity management
Data Security and Resilience: Failure to
provide a resilient platform or prevent
data loss due to security threats poses
significant operational and contractual
risks. The digitalisation of services
requires robust safeguards to protect
member data and comply with privacy
regulations, including GDPR.
New Technologies: Utilising new
technologies, including AI, may
introduce new risks, as the increased
complexity and interconnectedness of
AI systems may expose vulnerabilities,
leading to potential data breaches,
unauthorised access, and compromise
of sensitive information.
Investment In Security Software and
Processes: Continuous investment in
“best-in-class” security software and
processes, including external penetration
testing, endorsed by the Board.
Employee Security Training: Regular security
training for employees to enhance awareness
and response capabilities.
PCI DSS and SOC Type 2 Compliance: The
Group maintains Payment Card Industry Data
Security Standard Level 1 (PCI DSS)
certification and SOC Type 2 compliance.
Audits and Penetration Testing: Annual PCI
DSS and SOC Type 2 audits, along with
penetration tests by independent external
auditors, supplement internal checks and
those conducted by corporate clients.
Substantial Digital Investment: £13.9m
(2022: £13.6m) was invested in
proprietary digital platforms,
communications, and technologies,
emphasising the Group’s commitment
to digital advancement.
Ten Digital Platform Expansion: The
Ten Digital Platform is now live with
over 50 corporate client brands
globally, showcasing a significant
expansion from the previous year.
Continuous Platform Improvements:
Key improvements were developed for
the Ten Digital Platform, enhancing its
capabilities and ensuring continued
relevance in the market.
Evolving Cybersecurity Landscape:
Despite ongoing mitigation efforts, the
general risk of cybersecurity attacks
across companies has increased.
No Major Cyber Incidents: No major
cyber incidents were reported during
the year, indicating the effectiveness
of cybersecurity measures.
Retention of Accreditation and
certification: The Group retained its
PCI DSS Level 1 accreditation and SOC
Type 2 certification, reinforcing its
commitment to data security and
compliance.
Description
OPERATIONAL
Recruitment and retention of talent
People-Related Risks: Failure to
manage people-related risks,
potentially leading to a loss of
organisational culture and causing
operational or strategic disruptions.
The Group’s success hinges on
retaining talent, requiring ongoing
efforts to attract, motivate, develop,
and retain skilled employees.
Corporate clients and competition
Corporate Contracts: Most of the
Group’s Net Revenue is derived from
contracts with corporate clients.
Failure to secure, renew, or comply
with contract terms could impact
revenue and profitability.
Optimising Operational Efficiency and
Price Alignment: Operational
inefficiencies or price misalignment
may affect contract profitability and
lead to client loss.
Supplier partners
Supplier Partnerships: The Group relies
on supplier partners for critical
business services and goods. Risks
include challenges in managing cost
pressures in the supply chain and
potential service disruptions due to
underperforming suppliers.
Mitigation strategies
Change in 2023
Competitive Compensation: Regular reviews
of salaries, bonuses, and share options to
ensure fair compensation for staff.
Flexible Working: Continued provision of
flexible working arrangements where
appropriate.
Employee Satisfaction Focus: Ongoing
monitoring of annual employee satisfaction
with proactive measures to address concerns
and dissatisfaction.
Staff Development Emphasis: Sustained
focus on staff development, exemplified by
the Group’s Global Leadership Programme.
Strong Sales Pipeline: The Group maintains a
robust sales pipeline to ensure a steady
influx of new contracts.
Client Engagement and Data-Driven
Monitoring: The corporate client services
team engages with key contacts daily,
delivering data-driven reporting to monitor
compliance with service levels and
demonstrate the return on investment.
Regular Pricing and Commercial Term
Reviews: Ongoing reviews of pricing and other
commercial terms to maintain competitiveness.
Competitive Advantage Through Ten Digital
Platform: The Group sustains a competitive
edge through its market-leading Ten Digital
Platform.
Salary Pressures From Regional
Inflation: Increased salary pressures
due to regional wage inflation and
competitive recruitment markets.
Management Succession and
Development: Augmented emphasis
on management succession planning
and development initiatives.
Global Leadership Programme: Graduates
from the Group’s Global Leadership
Programme achieving promotions and
taking on mentorship roles.
Expansion of DEI Programme:
Expansion of the Group’s Diversity,
Equity, and Inclusion (DEI) Programme
to foster inclusion and ensure equality
of opportunity.
Contract Retention and Acquisition:
The Group successfully retained all
Material Contracts up for renewal and
secured four new Material Contracts.
Client Confidence: Confidence of both
existing and new corporate clients has
returned, signalling continued recovery
from the effects of COVID-19.
Strategic Price Adjustments: Some
agreed-upon price increases with
corporate clients, driven by the
perceived value of services and a
robust competitive position.
Robust Commercial Relations: The Group
maintains strong commercial and contractual
relations with critical supplier partners.
Alternative Supplier Planning: The business
has a clear understanding of alternative
supplier options in the market, and a
tested recovery protocol is in place
for potential disruptions.
Due Diligence Checks: Initial and regular
due diligence checks are conducted on key
supplier partners, assessing creditworthiness
and ensuring compliance with contracts
and regulations.
Supplier Code of Conduct: Expansion of
the Supplier Code of Conduct establishes
minimum standards and transparency
expectations from key supplier partners.
Strategic Partnerships: New strategic
partnerships were formed with hotel,
ticketing, restaurant, and travel
suppliers to enhance Ten’s member
proposition.
Technology Provider Reviews: Reviews
were conducted on key technology, IT,
and cloud providers to ensure their
continued reliability and performance.
Expansion of the Supplier Code of
Conduct: The expansion of the
Supplier Code of Conduct was
initiated, outlining updated standards
and transparency expectations
from key supplier partners.
Strategic reportStrategic reportTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023 44
Financial Review
45
Alan Donald
Chief Financial Officer
Net Revenue increased by 35% to £63.0m. The growth in Net
Revenue has been driven by strong growth in both corporate
revenue and supplier revenue.
Record Adjusted EBITDA profitability at £12.0m, delivering an
inflexion point for the business as we made our maiden profit
before tax of £0.9m since IPO in November 2017.
As a result, the Adjusted EBITDA margin increased to 19.1% and
the operating cashflow of the Group increased to £11.5m.”
Strong growth during the year has
delivered record Net Revenues,
Profits and Operating Cashflow
Net Revenue
£63.0m
+35%
(2022: £46.8m)
Adjusted EBITDA
£12.0m
+145%
(2022: £4.9m)
Revenue
Corporate revenue
Supplier revenue
Net Revenue
Operating expenses and other income
Adjusted EBITDA
Adjusted EBITDA %
Depreciation
Amortisation
Share-based payments
Exceptional items charge
Operating profit/(loss) before interest
and tax
Net finance expense and
foreign exchange
Profit/(loss) before taxation
Taxation credit/(expense)
Profit/(loss) for the period
Profit/(loss) after tax %
Net cash
2023
£m
66.7
55.6
7.4
2022
£m
48.7
41.1
5.7
63.0
(51.0)
46.8
(41.9)
12.0
4.9
19.1%
10.4%
(2.9)
(5.3)
(0.9)
(1.1)
(2.7)
(4.6)
(0.5)
(0.8)
Adjusted EBITDA
Adjusted EBITDA is not a statutory measure; however,
the Board believes it is appropriate to include this as an
additional metric as it is one of the main measures of
performance used by the Board. It reflects the underlying
profitability of our business operations, excluding amortisation
of investment in platform infrastructures, exceptional charges,
and share-based payment expenses and related taxes.
Revenue and Net Revenue
Revenue for the twelve months to 31 August 2023 was £66.7m,
up 37% on the twelve months to 31 August 2022 (2022: £48.7m).
Net Revenue13 for the twelve months to 31 August 2023 was
£63.0m, up 35% compared to the prior year (2022: £46.8m),
29% at constant currency. Net Revenue, which includes the
direct cost of sales relating to member transactions managed
by the Group, is Ten’s preferred measure of revenue as it
includes the cost of member transactions where Ten is the
principal service provider (i.e., cost of airline tickets packaged
with hotels under the Group’s ATOL licences).
1.8
(3.7)
(0.9)
(0.1)
The uplift in Net Revenue of 35% was principally driven by
record active member numbers and requests which have
helped to grow both corporate revenue and supplier revenue
to its highest levels.
(3.8)
(0.5)
The graph below provides a five-year history of Net Revenue.
This highlights the strong growth over the past two years
post the impact of the pandemic in 2020 and 2021.
0.9
3.6
4.5
(4.3)
Net Revenue (£m)
6.7%
(8.8%)
3.7
3.2
45.8
5.5
40.3
44.2
3.3
40.9
46.8
5.7
41.1
34.7
2.8
31.9
63.0
7.4
55.6
2019
2020
2021
2022
2023
Corporate revenue
Supplier revenue
Strategic reportStrategic reportTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023 46
Financial Review continued
47
Contract analysis
The following tables set out an analysis of our contracts by
size and by region. We have analysed only our Material
Contracts. Note, the contract size is based on the annualised
value paid or expected to be paid by the corporate client for
the provision of concierge and related services by Ten. This
does not include the revenue generated from supplier
partners through the provision of these concierge services.
Contract by size
2023
2022
Change
Extra Large
Large
Medium
3
6
19
28
3
6
19
28
—
—
—
—
Contract by region
2023
2022
Change
Europe
Americas
AMEA
Global
10
11
6
1
28
10
11
6
1
28
—
—
—
—
—
The Group has retained all material contracts in the year
which has helped to generate record revenues in the year.
Although the number of Material Contracts have not
increased during the period, a number of new mandates won
have augmented existing Material Contracts, including the
expansion of a digitally enabled concierge programme in the
Americas for premium customers.
Regional analysis
While there is a clear overlap between the geographic
location of our corporate clients and their members’
requests, members use our concierge services across all the
regions. Net Revenue by region reflects our servicing location
rather than the location of our corporate clients. This allows
us to track the efficiency and profitability of our operations
around the world and is therefore presented on this basis.
In the year, we have changed the regional structure to align to
the operational management of the Group with Middle East
and Africa moving from EMEA to Asia. This has created two
new regions: Europe, and Asia Middle East and Africa (AMEA).
Prior year figures have been restated to reflect this change.
Net Revenue
Europe
Americas
AMEA
2023
£m
25.9
25.8
11.3
2022
£m
%
change
20.6
16.5
9.7
26%
56%
16%
63.0
46.8
35%
In Europe, Net Revenue increased by 26%. The Group has
continued to drive growth in existing corporate contracts
through strong member proposition and offers. This has led to
record levels of revenue being generated from these
relationships. Member activity has also reached record levels
which has driven growth in supplier revenue in the region.
Americas Net Revenue grew significantly in the year, an
increase of 56%. The growth in this region was driven by
increased member activity across the region as the Group
benefited from the full year trading of contracts launched
just prior to the impact of the pandemic and expansions
secured during the period.
In AMEA, Net Revenue grew by 16%, lower than other regions
as pandemic restrictions took longer to be lifted at the start
of the financial year.
Operating expenses and other income
Operating expenses and other income increased by £9.1m to
£51.0m, an increase of 22% (2022: £41.9m). The increase in
cost was principally driven by additional headcount required
to service the uplift in activity across the business. Average
number of employees in the year has grown by 13% to 1,244
(2022: 1,101). The lower increase in Operating expenses and
headcount versus Net Revenue growth is driven by improved
operational efficiencies across the Group.
Regional Adjusted EBITDA
As a result of our Net Revenue growth and delivering on
operational efficiencies, Adjusted EBITDA has increased by
£7.1m to £12.0m (2022: £4.9m), £11.1m at constant currency.
Adjusted EBITDA is after expenses, other than depreciation of
£2.9m (2022: £2.7m), amortisation of £5.3m (2022: £4.6m),
exceptional items expenses of £1.1m (2022: £0.8m) and share-
based payments of £0.9m (2022: £0.5m).
After allocating the costs of central IT infrastructure,
software development, property, senior management, and
other central costs, the Adjusted EBITDA for each region is
set out below:
Adjusted EBITDA
Europe
Americas
AMEA
2023
£m
9.2
1.9
0.9
12.0
2022
£m
Change
£m
4.9
(0.7)
0.7
4.9
4.3
2.6
0.2
7.1
The above regional split has taken account of the new
regional structure introduced this year to align to our
operational management structure as previously explained.
Europe
Adjusted EBITDA of £9.2m (2022: £4.9m) is an increase year
on year of £4.3m. The increase in profitability was driven by
the strong growth in both corporate revenue and supplier
revenue, whilst supported by efficiencies gained in the
operating costs of the segment. The segment benefited from
hiring which had taken place in the previous year allowing the
headcount to grow by only 8% whilst driving Adjusted EBITDA
growth by 88%.
Americas
The Americas region achieved an Adjusted EBITDA profit of
£1.9m (2022: loss £0.7m). The growth in Adjusted EBITDA was
the result of the success of the investments made to grow the
business across the region. The region has now benefited from
a full year of trading on contracts launched in the prior year,
whilst continuing to invest in the operations to support future
potential contract wins.
AMEA
The AMEA region Adjusted EBITDA grew to £0.9m (2022:
£0.7m). The region has benefited from the ending of travel
restrictions during the year, which has driven the majority
of the EBITDA growth.
Amortisation
Amortisation costs, relating to the internal platform
(TenMAID) and the member-facing platforms, were £5.3m
in 2023 (2022: £4.6m), reflecting continued investment in
technology to drive improvements in service levels, efficiency,
and competitive advantage.
Net finance expense
Net finance expense in the year was £0.9m (2022: £0.1m); the
expense included loan interest of £0.4m (2022: £0.1m), IFRS 16
lease interest expense of £0.2m (2022: £0.2m) as well as
foreign exchange losses on the translation of inter-company
balances in the year of £0.2m (2022: gain of £0.2m).
Share-based payments
The share-based payments expense in the year was £0.9m
(2022: £0.5m). These related to share-based payments
expense reflecting share grants made under management
incentive plans as well as the associated national
insurance expenses.
Exceptional items expense
The exceptional items expense was £1.1m (2022: £0.8m). The
expenses incurred principally related to a one-off
restructuring program during the year to drive further
operational efficiencies including rationalisation of roles in
our senior leadership team and regional management teams.
In addition, further costs were incurred relating to the closure
of our Russian operation last year plus an historic overseas
tax charge relating to 2019.
Profit before tax (PBT)
The Group has made its first annual PBT since listing,
achieving a PBT of £0.9m compared to a loss before tax
of £3.8m in 2022.
Deferred Tax and Taxation
The Group has previously not recognised any deferred tax
asset associated to historical losses within the Group due to
the loss-making position of the Group. In the current period,
the Group’s PBT is £0.9m. The generation of profits indicates
that the Group can generate future taxable profits allowing it
to utilise historical tax losses. Based on current forecasts,
there are sufficient probable future profits to recognise a
deferred tax asset relating to historical losses of £5.3m,
primarily driven by the UK entity (£4.2m).
The taxation expense for the year was a tax credit of £3.6m
(2022: tax expense of £0.5m). The tax credit for the year was
the result of the recognition of deferred tax assets related to
historical losses of £5.3m (2022: £nil), offset by timing
differences on deferred tax of £1.0m (2022: £nil) and current
year foreign taxes net of prior year adjustments of £0.7m
(2022: £0.5m).
Earnings per share (basic, diluted,
and underlying)
The profit after tax for the year was £4.5m (2022: loss £4.3 m),
resulting in a basic profit per share (excluding treasury shares)
of 5.4p (2022: loss per share of 5.2p) and diluted profit per
share of 5.2p (2022: loss per share of 5.2p). Diluted earnings
per share is calculated as per IAS 33 by adjusting the
weighted average number of ordinary shares outstanding for
the dilutive effect of “in the money” share options.
Basic underlying earnings per share of 0.4p (2022 (4.2p)) and
diluted underlying earnings per share of 0.4p (2022 (4.2p)).
Underlying earnings per share is calculated by adjusting the
profit / (loss) attributable to equity shareholders for
exceptional items of £1.1m (2022: £0.8m) along with deferred
tax arising from the recognition of historical losses of £5.3m
(2022: £nil). No changes are made to the weighted average
number of ordinary shares. The Board does not recommend
the payment of a dividend.
Group cash flow
Profit/(loss) before tax
Net finance expense
Working capital changes
Non-cash items (share-based
payments, depreciation and
amortisation charges,
exceptional items)
Operating cash flow
Capital expenditure
Investment in intangibles
Taxation paid
Cash inflow/(outflow)
Cash flows from financing activities
Sale of treasury shares
Issue of shares
Loan receipts >1 year
Invoice financing facility
2023
£m
0.9
0.9
0.4
9.3
11.5
(0.5)
(7.3)
(0.8)
2.9
0.1
0.6
1.2
0.1
2022
£m
(3.8)
0.1
(0.1)
8.6
4.8
(0.9)
(6.4)
(0.6)
(3.1)
0.5
1.4
3.4
—
Repayment of leases and net interest
(3.2)
(2.7)
Net cash (used by)/generated from
financing activities
Foreign currency movements
Net increase/(decrease) in cash and
cash equivalents
Cash and cash equivalents
Net cash
(1.2)
(0.1)
1.6
8.2
3.7
2.6
0.4
(0.1)
6.6
3.2
Strategic reportStrategic reportTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023
48
Financial Review continued
49
Going concern
The impact of plausible adverse macroeconomic scenarios on
Ten’s business still warrants focus and real-time management.
The Group is particularly exposed to the adverse impacts to
variable revenues from these scenarios as well as the risk of
corporate revenue contracts not being renewed.
The Group has set its budget for 2024 and forecast for the
following year but we recognise that there are scenarios
under which the Group could be impacted by reductions in
the number of member engagements and by prospective
corporate clients failing to renew contracts. From our budget
base case, a stress scenario of 20% reduction in variable
revenues was performed as well as a severe downside
scenario of 90% reduction in variable revenues. In each of
these scenarios, if revenue is not in line with cash flow
forecasts, the Directors have identified cost savings
associated with the reduction in revenue and can identify
further cost savings if necessary.
The Directors have no reason to believe that corporate
revenue and receipts will decline to the point that the Group
no longer has sufficient resources to fund its operations.
However, in the unlikely event this should occur, the Group
will continue to manage its working capital position, as well
as making significant reductions in its fixed costs.
Post-year-end events
Since the end of the year, the Group has:
▪ Announced the further expansion of an existing contract
with a financial services client in the Americas, which will
now increase from a Medium to a Large contract and
announced a new contract win with a global Private Bank
client, anticipated to equate to a Medium contract.
▪ Raised a further £950k of three-year loans notes, including
£250k of loan notes subscribed for by Nitro Ventures
Limited on 21 November 2023, which constitutes a related
party transaction under the AIM Rules for Companies as
Jules Pancholi, Non-Executive Chairman, is a shareholder
and director of Nitro Ventures Limited. The loan notes are
repayable on 25 November 2026 and are guaranteed by Ten
Lifestyle Group Plc. Interest is payable quarterly in arrears
in cash at 12% per annum during the term of the loan and a
1% administration fee is payable in cash at drawdown. An
early repayment premium will be payable by the Company
of 5% should it repay the loan notes on or before 24
November 2024 or of 3% should it repay the loan notes on
or before 24 November 2025.
▪ The independent directors of the Company (with the
exception of Jules Pancholi who is involved in the related
party transaction) consider, having consulted with Singer
Capital Markets Advisory LLP, the Company’s nominated
adviser, that the terms of Nitro Ventures Limited’s
subscription for loan notes is fair and reasonable insofar as
shareholders are concerned.
▪ Extended the £1.5m loan, originally entered into in March
2022, with Mrs S Weatherill, wife of the previous Chairman
Mr B Weatherill until December 2024.
Alan Donald
Chief Financial Officer
21 November 2023
Group cash flow continued
Cash generated from operations increased by £6.7m (140%) to £11.5m (2022: £4.8m). Non-cash items in the year of £9.3m (2022:
£8.6m) were substantially made up of depreciation of £2.9m and amortisation charges of £5.3m for the year.
The expenditure that was capitalised on IT equipment and infrastructure, the Ten Digital Platform and TenMAID totalled £7.8m
(2022: £7.3m) as we continued to invest in our technology.
Net cash from financing activities was primarily due to loan receipts of £1.2m (2022: £3.4m), receipts from the issue of equity of
£0.6m (2022: £1.4m), offset by IFRS 16 lease payments and interest of £3.2m (2022: £2.7m). This has led to an overall increase in
cash and cash equivalents of £1.6m during the year with Net cash at £3.7m (2022: £3.2m), an increase of £0.5m.
The additional loan receipts of £1.2m are repayable in August 2025. The loans are guaranteed by Ten Lifestyle Group Plc.
Interest is payable quarterly in arrears in cash at 8% per annum during the term of the loan, a 1% administration fee payable
in cash at drawdown.
Group balance sheet
Intangible assets
Property, plant and equipment
Right-of-use assets
Deferred tax asset
Cash
Other current assets
Current lease liabilities
Current liabilities
Short-term borrowings
Non-current lease liabilities
Long-term borrowings
Net assets
Share capital/share premium
Reserves
Total equity
2023
£m
15.4
0.9
1.9
4.3
8.2
12.1
(1.7)
(20.9)
(1.6)
(0.4)
(3.0)
15.4
31.4
2022
£m
13.4
0.9
2.2
—
6.6
10.1
(1.8)
(17.3)
(1.5)
(0.9)
(1.9)
9.8
30.7
(16.2)
(20.9)
15.2
9.8
Net assets were £15.2m (2022: £9.8m). The increase in the year was driven by increased profitability in addition to the recognition
of a deferred tax asset of £4.3m. This is made up of the £5.3m recognition of historical losses offset by utilisation of deferred tax
of £0.3m in the year, and recognition of in other temporary differences of £0.7m. The Group has also continued to invest in its
digital platforms, driving the increase in intangible assets. This was offset by the increase in long-term borrowing arrangements.
Key financial performance indicators (KFPIs)
Management accounts are prepared on a monthly basis and include KPIs covering revenue, Adjusted EBITDA, cash balances, and
Material Contracts, and are measured against both the Group’s budget and the previous years’ actual results. The KFPIs for the year are:
Net Revenue (£m)
Corporate (£m)
Supplier (£m)
Net Revenue growth %
Adjusted EBITDA
Adjusted EBITDA Margin %
Net cash (£m)
Material Contracts
2023
63.0
55.6
7.4
35%
12.0
2022
46.8
41.1
5.7
35%
4.9
19.1%
10.4%
3.7
28
3.2
28
2021
34.7
31.9
2.8
-21.6%
4.4
12.8%
6.7
24
2020
44.2
40.9
3.3
-3.5%
4.8
10.8%
10.0
23
Each month the Board assesses the performance of the Group based on these KFPIs, operational performance indicators,
including the number of Active Members, as described on pages 22 and 23, sales performance, corporate client development,
technology updates. The Group’s performance has strengthened since being previously impacted by COVID-19, achieving
records across several its KFPIs.
Strategic reportStrategic reportTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023
Corporate Governance
50
Governance at a Glance
Chairman’s Introduction to Governance
51
G overnance is essential to building a
successful business that is sustainable
for the longer term. Ten is committed
to ensuring and maintaining high standards of
corporate governance to enhance performance
and strengthen stakeholder confidence.
Board changes
22 February 2023
Victoria Carvalho, Chief Proposition Officer, assumed the role
of Executive Director. Simultaneously, Sarah Hornbuckle
stepped down as Executive Director, continuing in the role of
Client Services Director.
Budget Approval and Strategic
Investments
Approval of the Group’s budget, including the adjustments to
headcount and continued investment in the Group’s
proprietary technology, communications, and content
Board Changes
Appointment of a new Non-Executive Chairman, Non-
Executive Directors and an Executive Director
29 July 2023
Bruce Weatherill, Non-Executive Chairman announced his
intention to step down in the Autumn, due to ill health,
naming Jules Pancholi as the next Chairman. Jules was
appointed to the Audit and Risk Committee and Gillian
Davies, Non-Executive Director was appointed to the
Nomination Committee.
8 November 2023
Bruce stepped down from the Board and Jules was appointed
Chairman and Chair of the Nomination Committee. Gillian
indicated her intention to step down from the Board at the
conclusion of the AGM in February 2024. Edward Knapp and
Carolyn Jameson were appointed as Non-Executive Directors.
Edward was appointed to the Audit and Risk Committee and
Carolyn was appointed to the Remuneration Committee.
B Corp Application
Application for B Corp certification to underscore the Group’s
commitment to social and environmental responsibility.
Board structure
ESG Strategy
The ESG Working Group’s recommendations, including the
expansion of the Group’s TCFD and SECR monitoring and
climate transition planning
Working Capital Requirements
Invoice financing facility and other debt
Gender
3
5
Composition
1
3
4
Male
Female
Non-Executive Chairman
Executive Directors
Non-Executive Directors
Jules Pancholi
Non-Executive Chairman
Incoming Chairman renews
commitment to corporate
governance and mission
Dear Shareholders
In my new capacity as Chairman, I am honoured
to lead the Board in renewing our steadfast
commitment to a robust corporate governance
model. This commitment is not only an obligation
to our valued shareholders but extends to
delivering tangible benefits to all stakeholders
associated with our dynamic business.
As Chairman, my primary responsibility is to guide the Board
in adopting and implementing a governance model tailored to
the size and complexity of our business. Effectiveness in
governance is paramount, ensuring transparent
communication of the business’s performance to
shareholders and other stakeholders. We have chosen to
align with the Quoted Companies Alliance’s (QCA’s) Corporate
Governance Code for Small and Mid-Size Quoted Companies
(the “QCA Code”), and our adherence to this framework is
detailed on pages 56 and 57.
Ten’s overarching mission to become the world’s most
trusted service platform is a collective pursuit fuelled by the
shared purpose of the Board. We aspire to build a
sustainable, member-focused, and pioneering business that
stands out in the global landscape.
I’m delighted to announce that Ten achieved B Corp
certification in May 2023, reflecting our strong commitment
to social and environmental responsibility, transparency, and
accountability. This achievement, a testament to our
dedicated team, is set to benefit all stakeholders. As
Chairman, I express gratitude to all contributors and reaffirm
our unwavering dedication to our mission, strong governance,
and the transformative power of this certification in driving
positive change. Our journey continues with the vision to
create lasting value as a B Corp.
Since the end of the period, I am thrilled to welcome Edward
Knapp and Carolyn Jameson as Non-Executive Directors.
Edward will also be appointed to the Audit and Risk
Committee and Carolyn will be appointed to the
Remuneration Committee. Their extensive expertise in
technology, finance, and capital markets will undoubtedly
enhance the governance of our Board, reinforcing our
commitment to sound leadership and effective oversight.
Jules Pancholi
Non-Executive Chairman
21 November 2023
Corporate governanceCorporate governanceTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023 52
Board of Directors
53
Jules Pancholi
Non-Executive
Chairman
Alex Cheatle
CEO and
Co-Founder
Andrew Long
COO and
Co-Founder
Alan Donald
CFO
Victoria Carvalho
Chief Proposition Officer
Gillian Davies
Non-Executive Director
Edward Knapp
Non-Executive Director
Carolyn Jameson
Non-Executive Director
Alex co-founded Ten in 1998 and
currently serves as the Chief
Executive Officer (CEO) of the
Group. Prior to founding Ten,
Alex was a marketing manager
at Procter & Gamble and holds a
degree in Philosophy, Politics,
and Economics from Oxford
University. He guides the Group’s
strategy, emphasising a
continual focus on service
improvement. Based in London,
Alex oversees the Group’s global
operations and is dedicated to
implementing and executing its
overarching strategy.
This includes day-to-day
operations and the strategic
vision that drives Ten’s
commitment to being the
world’s most trusted service
platform. His leadership sets
the tone for the Group’s mission
and global impact.
N
Andrew co-founded Ten in 1998
and currently serves as the
Chief Operating Officer (COO) of
the Group, overseeing key facets
of the company’s operations.
His responsibilities span
corporate client and account
strategy, legal and compliance,
programme management, as
well as the management of
global real estate and capital
projects, including the
development of operational and
technological infrastructure. He
is also a member of Ten’s ESG
Working Group.
With a background in leading
a UK market-leading event
production business, Andrew
has been based in Singapore
since 2012, where he has
assumed leadership
responsibilities for the AMEA
region, contributing significantly
to Ten’s global presence and
strategic growth.
Alan brought his 30+ years of
experience working in the
insurance, healthcare, aviation,
business travel and leisure
sectors to Ten in June 2019.
Prior to joining Ten, Alan was UK
Finance Director at Thomas
Cook Group plc for nine months.
Previous to this, Alan was
Finance Director of the Travel
division of Saga Group plc,
EMEA CFO at Carlson Wagonlit
Travel and CFO at Menzies
Aviation, part of the John
Menzies Group plc. Alan also
held senior finance positions at
Willis Corroon plc, BUPA and
Cigna Healthcare. Alan qualified
as a Chartered Accountant with
Deloitte Haskins & Sells.
Julian (“Jules”) Pancholi joined
Ten in October 2017. Jules is an
experienced technology and
marketing services
entrepreneur, which includes
serving as a Non-Executive
Director of Skyscanner Limited,
the travel fare comparison
website, until its sale to C TRIP
for over £1.4bn in 2016. Jules
holds or has retired in the year
from Non-Executive and
Chairman positions with a
number of innovative growth
companies including Oritain
(forensic supply chain
traceability and ESG), Simple
Online Healthcare (e-commerce
automation), Nitro Digital (Life
Sciences marketing), Easy
Storage (storage innovation),
Borrow My Doggy (two-sided
marketplace) and Lumity Life
(wellness e-commerce). His
other ventures include Nixxie
Ltd (a US-focused advertising
tech business), Socius
Technologies Group Limited (a
B2B Fintech workflow solution)
and Nitro Property Ltd (a
syndicate-based property
portfolio business). He serves
on the Investment Committee
of Love Ventures. Jules was
appointed as Non-Executive
Director in October 2017 and
serves as Chair of the
Remuneration and Nomination
Committees as well as a
member of the Audit and Risk
Committee. On 8 November
2023 Jules was appointed as
Non-Executive Chairman and
Chair of the Nomination
Committee.
A
R
N
Edward is a seasoned global
business leader with extensive
experience in technology,
growth strategy, risk
management, and
transformation. He has held
executive roles in consultancy,
high-growth technology
companies and major financial
institutions, including McKinsey
& Company, Barclays, HSBC and
Revolut. Edward’s expertise
spans various sectors, including
financial services, consumer,
telecom, public sector, and
not-for-profit organisations.
Edward was appointed as
Non-Executive Director and
member of the Audit and Risk
Committee on 8 November 2023.
A
Carolyn has executive and
non-executive international
experience in technology, travel
and customer experience
environments. She has a
proven track record as a strong
business leader, adept at
simplifying complexity and
maintaining clarity in fast-growth
and dynamic settings, including
executive roles at Skyscanner
and a current executive role
at Trustpilot Group Plc. Her
expertise extends to building
trusted relationships across
cultures at stakeholder, board,
and investor levels and
possesses skills in simplifying
complexity, strategic thinking and
change management in emerging
and evolving areas. Carolyn was
appointed as Non-Executive
Director and member of the
Remuneration Committee on
8 November 2023.
R
Gillian is a Chartered
Accountant, qualified with
KPMG, and has held a number of
senior financial positions in both
listed and private equity backed
international companies,
including Zeneca plc, Avecia
Limited and Georgia Pacific.
Gillian then spent eleven years
as Group Finance Director of
FTSE listed 4imprint Group plc,
and in 2018 became CFO of AIM
listed Harwood Wealth
Management Group until its sale
to private equity. Gillian is
Senior Non-Executive Director
and Chair of the Audit
Committee at Knights Group
Holdings plc. She brings
financial expertise as a
Chartered Accountant and has
substantial experience as an
Executive and Non-Executive in
the listed environment. Gillian
was appointed as Non-
Executive Director in October
2017 and serves as Chair of the
Audit and Risk Committee as
well as a member of the
Remuneration and Nomination
Committees.
A
R
N
Victoria joined Ten’s Senior
Leadership Team in April 2018 as
Managing Director and was
appointed Chief Proposition
Officer in November 2022. She
is responsible for Ten’s Strategic
Partnerships across Travel,
Entertainment, Dining, Retail &
Events, Ten’s Content &
Communications agency as well
as Design, UX/UI.
Victoria is a results-orientated
C-suite leader with 20+ years’
experience in global, & growing
dual-listed businesses including
Dow Jones, Thomson Reuters
and latterly Nasdaq where she
was also Company Director of
their International Corporate
Solutions business. She has
extensive experience servicing
the world’s leading companies in
multi-sectors including Financial
Services, Technology, Legal,
Consumer Services, and
Healthcare. Victoria has lived
and worked in the financial
centres of London and New York.
Victoria’s expertise is in
leading high-performing
teams, complex global
Transformational Programmes,
M&A/Joint Ventures, Business
Development, Product and
Commercial Management, and
Business Process Reengineering.
Victoria was appointed as
Executive Director of the
Board on 22 February 2023.
She is also a member of
Ten’s ESG Working Group.
A
N
Audit and Risk Committee
R
Remuneration Committee
Nomination Committee
Chairperson
Corporate governanceCorporate governanceTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023
54
How We Comply with the QCA Code
55
Principle
Compliant
Explanation
Principle
Compliant
Explanation
DELIVER GROWTH
1
2
3
4
Establish a strategy
and business model
which promote
long-term value
for shareholders
Seek to understand
and meet
shareholder needs
and expectations
Take into account
wider stakeholder
and social
responsibilities and
their implications for
long-term success
Embed effective risk
management,
considering both
opportunities and
threats, throughout
the organisation
The Group’s strategy and business model are centred on delivering long-term
shareholder value through a growth engine that emphasises efficiency, service
quality, and value for members and corporate clients. This commitment
ensures seamless operations even in challenging circumstances. The strategy
consistently enhances service quality and efficiency, reinforcing the business’
long-term resilience.
For more information see pages 12 and 13.
The Board actively seeks to understand and meet shareholder needs and
expectations. Regular meetings with investors, analysts, and potential investors
allow for an ongoing dialogue to comprehend how the Group’s strategy and the
Board’s decisions impact and are perceived by the investor community.
Additionally, the AGM serves as a platform where all shareholders can meet
Directors and pose questions, fostering transparency and engagement.
For more information see pages 38 and 39.
The Board fulfils the requirement to consider wider stakeholder and social
responsibilities for long-term success. Regular discussions are held to analyse
the potential impacts of decisions and developments on Ten’s main
stakeholders, including members, shareholders, corporate clients, employees,
strategic partners, and the environment. To ensure a strategic and
comprehensive approach, Non-Executive Chairman, Jules Pancholi chairs the
ESG Working Group, which actively oversees the implementation of a
Sustainable Business Strategy.
For more information see pages 24 to 29.
The Group meets the requirement to embed effective risk management,
considering both opportunities and threats throughout the organisation. This
involves regular reviews of existing and new risks by the Board and the Audit
and Risk Committee. The communication of these risks is facilitated through
reporting lines from the Senior Leadership Team. Moreover, the Group ensures
that processes and control systems, managed by the Senior Leadership Team,
are integrated into relevant business functions.
For more information see pages 40 to 43.
MAINTAIN A DYNAMIC MANAGEMENT FRAMEWORK
5
6
Maintain the Board
as a well-
functioning,
balanced team led
by the Chairman
Ensure that between
them the Directors
have the necessary
up-to-date
experience, skills
and capabilities
The Group fulfils the requirement to maintain the Board as a well-functioning,
balanced team led by the Chairman. The Board, consisting of three
Non-Executive and four Executive Directors, is under the leadership of the
Chairman. It continually evolves its operational approach to optimise the
utilisation of Directors with extensive experience in business, travel, finance,
and technology. The Board’s meetings are marked by lively debate and active
idea exchange, reflecting a dynamic environment where management is
rigorously challenged and held accountable.
For more information see pages 53 to 59.
The adequacy of the Board’s collective skills and experience is systematically
evaluated through the annual Board effectiveness review. The Nomination
Committee actively participates in assessing and recommending
re-appointments and succession plans, ensuring that the Directors collectively
possess the essential and up-to-date expertise required for effective
governance. Additionally, individual development needs of Directors are
addressed through annual discussions with the Chairman, fostering continuous
improvement and skill enhancement.
For more information see page 59 and pages 68 and 69.
7
8
9
Evaluate Board
performance based
on clear and
relevant objectives,
seeking continuous
improvement
Promote a corporate
culture that is based
on ethical values
and behaviours
Maintain governance
structures and
processes that are
fit for purpose and
support good
decision making by
the Board
BUILD TRUST
10
Communicate
how the Group
is governed and
is performing by
maintaining a
dialogue with
shareholders and
other relevant
stakeholders
The Chairman leads an annual evaluation of the Board’s effectiveness,
employing clear and pertinent objectives to assess performance
comprehensively. This evaluation process identifies areas for improvement and
subsequently initiates a strategic plan of actions to address these areas,
fostering continuous enhancement. The Board diligently monitors year-on-year
improvements, ensuring a commitment to evolving and refining its performance.
For more information see page 59 and pages 68 and 69.
The Group’s cultural foundation is rooted in values of being member focused,
pioneering, and trustworthy, aligning seamlessly with the Group’s overarching
objectives and strategy. Ethical values and behaviours are actively promoted by
the Board through decision-making processes, and there is a dedicated
commitment to enhancing the Group’s environmental performance. To reinforce
these values, the Senior Leadership Team convenes biannually for a refocusing
on the Group’s core values, holding itself accountable for ensuring that ethical
values and behaviours are deeply ingrained throughout the organisation.
For more information see pages 28 and 29.
The Board employs a strategic governance structure where specific matters are
retained for direct consideration, while specialised tasks are delegated to
Committees and/or members of the Senior Leadership Team. This approach ensures
that the Board is furnished with pertinent and current information, facilitating
well-informed decision making on behalf of the business. The governance structure
is meticulously designed to be congruent with the size and intricacy of the
Group, taking into account its capacity, appetite, and tolerance for risk.
For more information see pages 26 and 27.
The Group prioritises transparent communication with shareholders, conducting
regular virtual meetings with investors, analysts, and potential investors.
Investor-centric information, including videos presented by the CEO, is
consistently published on the Group’s website. Executive Directors actively
engage with the Group’s employees, providing regular updates on the Group’s
strategy. The Senior Leadership Team, dispersed globally, plays a pivotal role in
reinforcing the Group’s values through continual communication.
For more information see pages 38 and 39.
Board composition and independence
The Board, accountable to shareholders, shapes the long-
term success strategy and oversees the Group’s
management, governance, controls, risk management,
direction, and performance. Monitored by the Nomination
Committee, the Board ensures a dynamic blend of financial
acumen, public market experience, diversity, and varied
skillsets. The Board asserts its satisfaction with the
composition of the Board and is confident in its ability to lead
the Group. The independent Non-Executive Chairman and
Non-Executive Directors maintain their independence from
management, adhering to QCA Code provisions, which
mandate at least two independent Non-Executive Directors
on the Board.
During the period, the Board comprised of four Executive
Directors, including two founders, and three Non-Executive
Directors, maintaining a 43% independence ratio.
Since the end of the period, Bruce Weatherill, independent
Non-Executive Chairman stepped down from the Board due
to ill health. Jules Pancholi, serving Non-Executive Director
succeeded Bruce as Chairman on 8 November 2023. Jules
brings extensive experience in driving value creation through
growth, technology and product-market fit as well as experience
as a non-executive director of Skyscanner and Chair of Oritain,
along with other executive and non-executive positions.
At the same time, Edward Knapp and Carolyn Jameson were
appointed as independent Non-Executive Directors. Edward
is a highly experienced global business leader with a
background in technology, growth strategy, risk management,
and transformation, having held executive roles at McKinsey &
Company, Barclays, HSBC, and Revolut, and currently serving
as a non-executive director of FTSE 100 F&C Investment Trust
Plc. Carolyn offers substantial international executive and
non-executive expertise in technology, travel, and customer
experience sectors, with a strong track record as a business
leader capable of simplifying complexity and maintaining
clarity in fast-growing environments, including executive roles
at Skyscanner and Trustpilot Group Plc.
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56
How We Comply with the QCA Code continued
57
Board composition and independence continued
On 22 February 2023, Victoria Carvalho, Chief Proposition
Officer, assumed the role of Executive Director. Joining Ten’s
Senior Leadership Team in April 2018 as Managing Director and
progressing to Chief Proposition Officer in November 2022,
Victoria brings over 20 years of strategic experience, including
significant roles at Nasdaq and Thomson Reuters.
Simultaneously, Sarah Hornbuckle stepped down as Executive
Director, continuing in the role of Client Services Director.
Board operation
The Board assumes responsibility for shaping, reviewing, and
endorsing the Group’s strategy, budgets, and corporate
initiatives, as detailed in the Strategic Report on pages 4 to
23. A formal schedule, outlining matters reserved for the
Board’s approval, guides its operations. Board meetings
convened at least eight times annually, with additional
sessions as needed, ensure diligent oversight. An annual
agenda, coupled with reports from the Senior Leadership
Team, keeps the Board well-informed.
The Board has established three Committees: The Audit and
Risk Committee, the Remuneration Committee, and the
Nomination Committee, each having written terms of
reference, which are available on the Group’s website
(www.tenlifestylegroup.com/investors). Separate reports by
Committee Chairpersons are presented on pages 60 and 61
(Audit and Risk Committee), pages 62 to 67 (Remuneration
Committee), and pages 68 and 69 (Nomination Committee).
Jules Pancholi was appointed to the Audit and Risk
Committee, and Gillian Davies joined the Nomination
Committee on 29 June 2023.
The ESG Working Group, chaired by Jules Pancholi and
members include Andrew Long and senior staff, reports to
both the Audit and Risk Committee and the Board.
Executive Directors are full-time employees. External
commitments of the Non-Executive Chairman and Directors,
outlined in Board biographies on pages 54 and 55, are
effectively managed within a time commitment of two to three
days monthly. All members, including Non-Executive Directors,
dedicate ample time to fulfilling their Group responsibilities.
Board meetings
The Board held five scheduled Board meetings during the
year, together with an additional six meetings held to discuss
specific issues or matters. In addition to formal Board
meetings, the Directors, including the Non-Executive
Directors, are in regular, informal communication to ensure
all members of the Board are fully informed.
Directors are expected to attend all meetings of the Board,
and of the Committees on which they sit, and to devote
sufficient time to the Group’s affairs to enable them to fulfil
their duties as Directors. In the event that Directors are
unable to attend a meeting, their comments on papers to be
considered at the meeting will be discussed in advance with
the Chairman so that their contribution can be included in
the wider Board discussion.
The following table shows Directors’ attendance at scheduled
Board and Committee meetings during the period:
Scheduled meetings
Bruce Weatherill
Gillian Davies
Jules Pancholi
Alex Cheatle
Andrew Long
Alan Donald
Sarah Hornbuckle
Victoria Carvalho
* Joined Committees on 29 June 2023.
** Retired from Board on 22 February 2023.
*** Joined Board on 22 February 2023.
Board
5
5/5
5/5
5/5
4/5
4/5
5/5
1/1 **
4/4 ***
Audit and Risk
Committee
Remuneration
Committee
Nomination
Committee
4
3/4
4/4
0/0 *
—
—
—
—
—
2
—
2/2
2/2
—
—
—
—
—
2
2/2
1/1 *
2/2
2/2
—
—
—
—
In addition to the Board meetings, the Board attended two strategic away days during the year to focus on strategic planning to
achieve the Group’s medium- and long-term objectives.
Board effectiveness
In the role of Chairman, Bruce Weatherill conducted a
comprehensive evaluation of the Board’s effectiveness,
employing key indicators throughout the year. The evaluation
covered aspects such as clear purpose and strong leadership,
a balanced blend of skills, experience, and independence
among Directors, collaborative teamwork, an understanding
of the business and its strategy, and effective information
and engagement with stakeholders.
The Chairman concluded that the Board operated effectively,
noting that the diverse skills of each Director complemented
one another, contributing to the overall efficacy of the Board.
As a result of the evaluation, specific actions were outlined,
including an increased frequency of presentations from the
Senior Leadership Team, providing in-depth insights into
specific business areas.
The Chairman deemed external advice or a third-party
facilitator unnecessary for refreshing the performance
evaluation process in the current year. However, he expressed
a willingness to reconsider this approach in the following year
if deemed necessary.
Board development
Directors remain informed and up to date on legal, regulatory,
and governance aspects through regular updates provided by
the Group’s Nomad, Company Secretary, independent
external auditor, and external advisers. This ensures the
Directors’ awareness and maintains the Board’s adherence to
current governance processes. The Company Secretary, an
integral part of the Board, attends all meetings, offering
advice on corporate governance matters and facilitating the
smooth flow of information to and from the Board.
To keep their skills and knowledge relevant, each Director
actively engages in both formal and informal methods, which
may include qualified continuing professional development
where applicable, memberships in leadership communities,
and participation in knowledge-based networking activities.
This commitment to ongoing development ensures that
Directors remain well equipped to address the evolving
challenges and opportunities within the business landscape.
Engagement with stakeholders
The Board remains steadfast in its commitment to fulfilling
responsibilities to diverse stakeholders, encompassing
shareholders, employees, corporate clients, members, supplier
partners, local communities, and the environment. Actively
striving for effective engagement and fostering participation
from each group, this commitment is further underscored by
the achievement of B Corp certification this year. The
certification enhances the formalisation of the Board’s
dedication to cultivating a sustainable business, with detailed
positive effects elaborated on pages 24 and 37. Directors
consistently exhibit mindfulness towards stakeholder needs,
incorporating them into the decision-making process. A
comprehensive account of the Board’s engagement with
different stakeholder groups is outlined in the Companies Act
2006 Section 172 Statement on pages 38 and 39.
Risk management and internal controls
The Board holds ultimate responsibility for the Group’s risk
management and internal controls, entrusting the monitoring
of the Group’s risk and control management system
framework to the Audit and Risk Committee. The
appropriateness of internal controls is determined by the
Board based on the Committee’s recommendations. The risk
and control management system framework encompasses
close management of day-to-day activities, regular reviews of
the risk register, an annual budgeting process, detailed
monthly performance reporting, and central control over
critical areas such as capital expenditure and banking facilities.
The Executives and Senior Leadership Team are accountable
for the effective implementation of the risk and control
management system framework within their respective
business areas, fostering an embedded risk culture.
Delegating responsibility for identifying, assessing, and
managing climate-related risks to the Audit and Risk
Committee, informed by the ESG Working Group, ensures
the Group’s awareness and mitigation of ESG-related risks.
Periodic reviews of the internal control system align with
best practices, considering the Group’s size and available
resources. The Board, presently, deems the introduction
of an internal audit function as inappropriate but commits
to periodic reviews of this decision.
Annual General Meeting (AGM)
The Annual General Meeting of the Group will take place on
6 February 2024. Full details will be included in the Notice of
Meeting which will be published on our website in due course
(www.tenlifestylegroup.com/investors).
Corporate governanceCorporate governanceTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023 58
Audit and Risk Committee Report
59
The Audit and Risk Committee is responsible for
reviewing Ten’s internal financial controls and the
audit process, maintaining an appropriate
relationship with Ten’s auditor and ensuring that
the financial performance of the business is
properly reported and reviewed.
I am pleased to present the
report on behalf of the Audit
and Risk Committee for the
period ended 31 August 2023.”
Gillian Davies
Chairperson of the Audit and Risk Committee
The Committee reviews reports on the interim and annual
accounts, financial announcements, Ten’s accounting and
financial control systems, changes to accounting policies, the
extent of the non-audit services undertaken by the external
auditor and the appointment of the external auditor.
The Committee is also responsible for monitoring the
adequacy and effectiveness of Ten’s risk management
system, including ESG-related risks and opportunities.
Members of the Committee
The Committee comprised myself, Gillian Davies, who served
as the Chairperson; Bruce Weatherill, Non-Executive
Chairman; and Jules Pancholi, incoming Non-Executive
Chairman, joined the Committee on 29 July 2023. As a
Chartered Accountant, I bring extensive relevant financial
experience from executive and non-executive roles within
main list and AIM companies. Bruce Weatherill, formerly a
partner at PwC, held a leadership position in its banking and
wealth management practice globally and has wide non-
executive and relevant financial experience. Jules Pancholi
contributes experience from an extensive background of non-
executive and executive roles.
Since the end of the period, Bruce Weatherill stepped down
from the Board and the Audit and Risk Committee on 8
November 2023 and Edward Knapp, was appointed as a
Non-Executive Director and member of the Audit and Risk
Committee on 8 November 2023. I extend my sincere thanks
to Bruce for his significant contribution to the Committee
during his tenure and welcome Edward to the Committee.
Additionally, Alex Cheatle, Group CEO, Alan Donald, CFO, and
other members of the finance team attend the Committee by
invitation.
Throughout the year, the Committee conducted four
scheduled meetings. The Chair of the Committee engages
with the CFO outside of meetings and invites members of the
Finance Team to present relevant information to the
Committee.
Business of the Committee
The main duties of the Committee are set out in its
terms of reference, which are available on Ten’s website
(www.tenlifestylegroup.com/investors). The main items
of business considered by the Committee during the
period included:
▪ consideration and approval of the half year
results announcement
▪ consideration and approval of the full year results
announcement and the Annual Report and Accounts
▪ consideration of the principal judgemental
accounting matters for Ten based on reports from
executive management
▪ consideration of ESG risks, strategies, and reporting
▪ consideration of going concern, business model
and strategy
▪ consideration of debt, including the invoice financing
facility, and cash flow forecasting
▪ consideration of the impact of exchange rates
▪ consideration of the risks and response to the conflict
in Ukraine
▪ the review of the structure of the Finance Team
▪ the review of financial improvements
Going concern
In preparation for the publication of the Group’s Financial
statements, the Audit Committee conducted a
comprehensive review of the going concern position.
Management prepared a paper setting out the methodology
and assumptions used for the assessment of going concern,
based upon the Group’s approved budget and forecast for the
following year together with sensitivity analysis. The
Committee discussed the assumptions and results, including:
▪ the review of whistleblowing, modern slavery and
▪ base case
anti-bribery arrangements
▪ results of severe, but plausible downside scenarios
▪ the review and approval of the 2023 audit plan and audit
engagement letter
▪ stress tests undertaken
▪ mitigating actions including reducing elements of the cost
base
▪ financing facilities available
Following this review the Committee confirmed to the Board
that they were satisfied that the Group should adopt the
going concern basis for of accounting in preparing the
financial information for the year ended 31 August 2023 and
that there is a reasonable expectation that the Group had
adequate resources to continue in operational existence for
the foreseeable future.
External auditor
The Committee is responsible for reviewing the suitability of
the external auditor, BDO, to ensure that auditor
independence and objectivity are maintained. The external
auditor prepares a plan for its audit of the full year financial
statements which is presented to the Committee before
commencement of the audit. The Committee also met with
the external auditor without management present during the
period. BDO was appointed as auditor of Ten in 2017 and the
Committee continues to be satisfied with its effectiveness.
The Committee is responsible for ensuring there is a suitable
policy for ensuring that non-audit work undertaken by the
auditor is reviewed to ensure it will not impact its
independence and objectivity. The breakdown of fees
between audit and non-audit services is provided in note 7 to
Ten’s financial statements.
Taking into account the auditor’s knowledge of the business
and its experience, the Committee has recommended to the
Board that the auditor is re-appointed for the period ending
31 August 2024.
Gillian Davies
Chairperson of the Audit and Risk Committee
21 November 2023
▪ the review of suitability of the external auditor
▪ meeting with the external auditor without
management present
▪ consideration of the external audit report and management
representation letter
▪ the review of the risk management and internal
control framework
Results and financial reporting
During the year the Committee reviewed draft half and full year
results announcements and the Annual Report and Accounts.
The Committee reviewed whether suitable accounting policies
had been adopted and whether management had made
appropriate judgements and estimates. The Committee
reviewed accounting papers prepared by management
providing details on the main financial reporting judgements.
The Committee also reviewed reports provided by the
external auditor on the annual results which highlighted any
observations from the work it has undertaken.
Changes in accounting policies/application
of IFRSs
The Committee is satisfied that there are no changes in
accounting policies which impact the current year.
There are no significant IFRSs yet to be adopted that the
Committee expects to have a significant impact on the
financial statements.
Risk management, internal controls and
internal audit
As detailed on page 59 of the Corporate Governance
Statement, Ten’s risk management and internal control
framework is monitored by the Committee. The framework is
designed to manage the Board’s risk appetite rather than
eliminate the risk of failure to meet Ten’s strategic objectives.
During the period, the Committee has reviewed the
framework reports from management on internal controls
and comments made by the external auditor in its
management letters. The Committee is satisfied that the
internal control systems in place are sufficient and currently
operating effectively for a business of this size. The principal
risks facing the business are set out in the section of this
report on risk management on pages 40 to 43.
Ten does not have an internal audit function and this is not
currently considered to be necessary due to the size of the
business and the adequacy of internal controls. This will be
kept under review as the business evolves.
Corporate governanceCorporate governanceTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023 60
Remuneration Committee Report
61
Our people play a pivotal role in realising Ten’s
mission to become the most trusted service
globally, and our remuneration strategy is
crafted to inspire, retain, and recognise the
contributions of our global workforce that drive
the Group’s success.
I am pleased to present
this Remuneration
Committee Report for
the period ended
31 August 2023.”
Jules Pancholi
Chairman of the Remuneration Committee
This report comprehensively outlines the Committee’s
responsibilities, the adopted policies, their application
throughout the year, and specifics regarding Directors’
remuneration arrangements.
Members of the Committee
The Committee is composed of two Non-Executives: me,
Jules Pancholi (as Chairman), and Gillian Davies. Alex Cheatle,
Group CEO, together with other Directors and advisers, may
attend Committee meetings by invitation. The Committee
held two scheduled meetings during the period outside of
meetings I engage with the CEO and CFO on matters relevant
to the Committee. The Committee operates under the
Group’s agreed terms of reference which are available on the
Group’s website (www.tenlifestylegroup.com/investors).
Since the end of the period, Carolyn Jameson, newly
appointed Non-Executive Director, was appointed as a
member of the Committee on 8 November 2023.
Duties
The Committee formulates the Group’s remuneration policy
and applies it to make recommendations to the Board on
Group-wide incentive plans, individual senior and executive
remuneration packages and new appointments to the Board
or Senior Leadership Team.
The Committee’s main duties and responsibilities are to:
▪ have responsibility for setting the remuneration policy for
all Executives and such other members of the executive
management as it is designated to consider
▪ recommend and monitor the level and structure of
remuneration for senior management
▪ obtain reliable, up-to-date information about remuneration
in other companies of comparable scale and complexity in
light of reviewing the ongoing appropriateness and
relevance of the remuneration policy
▪ review the design of all share incentive plans for approval
by the Board
▪ approve the design of, and determine targets for, any
performance-related pay schemes operated by the Group
and approve the total annual payments made under such
schemes
▪ ensure that contractual terms on termination, and any
payments made, are fair to the individual, and the Group,
that failure is not rewarded and that the duty to mitigate
loss is fully recognised
Remuneration policy
The Group’s remuneration policy is crafted with the objective
of attracting, motivating, retaining, and rewarding high-calibre
individuals whose expertise contributes to the Group’s success.
To achieve this goal, we have devised a remuneration strategy
that emphasises the allocation of share options under Long
Term Incentive Plans, complemented by competitive salaries
and pension-related benefits.
The majority of our Long-Term Incentive Plans are intricately
tied to share price performance or vest upon meeting
specific performance conditions, including total shareholder
return (refer to page 64 for detailed information). We firmly
believe that by offering Executives and key employees
long-term share options, as opposed to performance-related
bonuses, we synchronise remuneration with the enduring
interests of our shareholders.
Salaries and pension-related benefits constitute a fitting
component of fixed remuneration, providing the necessary
stability to attract and retain individuals possessing the qualities,
skills, and experience essential for achieving the Group’s
strategic objectives and generating value for our shareholders.
Executive Directors’ service contracts
and Non-Executive Directors’ letters
of appointment
Alex Cheatle and Andrew Long signed new service contracts
with the Group on admission to AIM in November 2017. Alan
Donald signed a service contract on his appointment in June
2019 and Victoria Carvalho signed a service contract on her
appointment in February 2023. The service contracts are not
of fixed duration. All of the Executives’ contracts are
terminable by either party giving six months’ written notice.
The Non-Executive Directors have annual letters of appointment
with the Group for the provision of the Non-Executives’
services, which may be terminated by either party giving
three months’ written notice.
Directors’ remuneration
The following table summarises the total gross remuneration
for the qualifying services of the Directors who served during
the year to 31 August 2023:
Basic
salary/fee
£
Pension
£
Options
exercised
£
2023
Total
£
Basic
salary/fee
£
Pension
£
Options
exercised
£
2022
Total
£
Executive
Alex Cheatle
Andrew Long*
Alan Donald
Sarah Hornbuckle**
Victoria Carvalho***
Non-Executive
Bruce Weatherill
Julian Pancholi
Gillian Davies
307,000
298,000
213,000
44,000
98,000
56,000
42,000
42,000
9,000
—
—
2,000
3,000
—
—
—
—
—
—
—
—
—
—
—
316,000
298,000
213,000
46,000
101,000
299,000
282,000
194,000
95,000
9,000
—
—
3,000
84,000
82,000
25,000
17,000
392,000
364,000
219,000
115,000
56,000
42,000
42,000
55,000
41,000
41,000
—
—
—
—
—
—
55,000
41,000
41,000
*
Andrew Long’s gross basic salary is paid in Singapore dollars at an agreed foreign exchange rate.
** Sarah Hornbuckle ceased being a director on 22 February 2023 and this reflects her salary to this date.
*** Victoria Carvalho was appointed on 22 February 2023 and this reflects her salary from this date.
The Group has not awarded remuneration to the Directors based on share price appreciation or depreciation. The Executive
Directors’ remuneration for 2024 is set out in the table below although this may be reviewed in the course of the year on the basis
of Group performance and market comparisons.
Alex Cheatle
Andrew Long*
Alan Donald
Victoria Louise Carvalho
311,000
302,000
222,000
166,000
* Andrew Long’s gross basic salary is paid in Singapore dollars at an agreed foreign exchange rate.
Basic
salary/fee
£
Pension
£
9,000
—
—
5,000
Total
£
320,000
302,000
222,000
171,000
Corporate governanceCorporate governanceTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023 62
Remuneration Committee Report continued
63
Management Incentive Plan
Shortly prior to listing, the Group adopted a Management Incentive Plan (MIP) on 9 November 2017. The MIP is designed to award
senior management nil-cost share options on an annual basis following the announcement of the Group’s annual results.
The options vest three years after the date on which the Company’s annual results are announced, subject to the performance
conditions. This vesting period was selected in line with guidance from the QCA (the Group’s adopted corporate governance code
is the QCA Corporate Governance Code). Appropriate claw-back provisions are available at the discretion of the Committee.
All MIP options awarded to Executives are subject to performance conditions based on the following ratcheted scale of growth
of total shareholder return (TSR):
Total shareholder return CAGR
% of award vesting
Less than 10%
10%
20% or more
Zero
25%
100%
Between 10% and 20%
Between 25% and 100% on a straight-line basis
The growth in TSR is calculated by using the compound annual growth rate (CAGR) of the share performance from the closing
share price on the date on which the Group’s financial results for the relevant year were announced to the London Stock
Exchange (the “Baseline TSR”) until the date of the announcement of the Group’s results three years later. There is no additional
return on a share price increase over 20% CAGR. Once vested, the holder may exercise the options up until the tenth
anniversary of the date of award.
Six MIP awards have been made since IPO:
Annual MIP award
2023
2022
2021
2020
2019
2018
Date of award
8 Sept 2023
10 Aug 2022*
21 Dec 2020
7 Jan 2020
24 June 2019**
07 Dec 2017
Vesting period
8 Sept 2023 –
7 Dec 2025
10 Aug 2022 –
7 Dec 2024
21 Dec 2020 –
7 Dec 2023
7 Jan 2020 –
7 Dec 2022
24 June 2019 –
7 Dec 2021
07 Dec 2017 –
7 Dec 2020
Performance period
Baseline TSR (£)
% of award vesting
3 years from
23 Nov 2022
3 years from
24 Nov 2021
3 years from
24 Nov 2020
3 years from
26 Nov 2019
3 years from
28 Nov 2018
3 years from
27 Nov 2017
0.47
—
1.08
—
0.91
—
1.27
60%
0.69***
100%
1.34
0%
*The award was delayed due to closed periods
** The award was delayed due to financial targets not being met.
*** Calculated based on the average closing share price for the dealing days from 28 November 2018 until 28 February 2019, due to a low share price (£0.34) on
28 November 2018.
The Committee believes the MIP and aforementioned performance metrics appropriately incentivise and are aligned with the
Group’s strategic goals and the long-term interests of our shareholders. The Committee continues to review the MIP and the
limits of the Company’s share plans in consultation with institutional shareholders on any proposal.
During the 2020 Performance period from 26 November 2019 to 7 December 2022, the Group’s share price was significantly
influenced by the macro-economic effects of Covid-19, resulting in a negative TSR for the period, which would have led to a
vesting of MIP options at 0%. However, the Committee took into account the Group’s performance over this period, which included
retaining all Material Contracts, improving EBITDA profitability, and increasing Net Revenue, and considered the potential adverse
impact of a 0% vesting on the motivation and retention of senior option holders. As a result, the Committee concluded that a 60%
vesting would be appropriate, aligning with the Group’s strategic objectives and the long-term interests of our shareholders.
Company Share Option Plan
Shortly prior to listing, the Group also adopted a Company Share Option Plan (CSOP), on 24 August 2017. CSOP options are
generally granted to senior management and employees key to the future success of the Group up to a maximum grant of
£60,000 of shares at an exercise price no lower than the mid-market share price the day before the date of grant.
CSOP options become exercisable after three years, subject to certain conditions, including appropriate bad leaver conditions.
Any gain from the exercise of CSOP options is subject to the relative increase in the share price over the three-year period,
incentivising and rewarding employees engaged in achieving the Group’s long-term strategic goals.
Salary Sacrifice Scheme
As part of the Group’s cost saving initiatives in response to COVID-19, the Group established a four-round, twelve-month
voluntary Salary Sacrifice Scheme (SSS), whereby employees and contractors can opt to forgo a percentage of their salary in
return for options over ordinary shares. The scheme generated a total cost saving of £2.2m and the exercise of these options to
date has generated cash receipts of £1.4m.
The exercise price and number of options granted for each round were determined using the Black Scholes model for option
pricing to ensure that the total economic value of these options is equal to the value of the total salary forgone. Participating
employees waived entitlement to salary in lieu of payment of the share options, with expected net dilution only above the
sacrifice breakeven share price listed. In light of this, the Committee considered it appropriate to exclude these options from
general headroom limits pursuant to the Company’s share plans.
The options were originally exercisable for or up to two or three years from the date of grant. Due to the prolonged impact of
COVID-19 on business trading and the effects of macroeconomic factors on global markets, the exercise period of remaining
options was extended in October 2023 to four years from the respective date of grant. The Committee believed this will
enhance employee engagement and alignment with our shareholders’ interests. All other terms of the options remain the same.
Total Director share options
The following table summarises the total share options held by the Executive Directors who served during the year to
31 August 2023:
Alex Cheatle
Andrew Long
Share option
scheme
MIP
MIP
MIP
CSOP
SSS
SSS
SSS
MIP
CSOP
MIP
MIP
MIP
MIP
CSOP
SSS
SSS
SSS
MIP
CSOP
MIP
Date of grant
24/06/2019
07/01/2020
21/12/2020
24/06/2019
09/07/2020
24/11/2020
24/03/2021
10/08/2022
13/10/2022
08/09/2023*
24/06/2019
07/01/2020
21/12/2020
24/06/2019
09/07/2020
24/11/2020
24/03/2021
10/08/2022
13/10/2022
08/09/2023*
Number of ordinary
shares under option
Exercise price
Vesting period
200,000
200,000
200,000
33,708
149,500
199,333
199,333
200,000
62,500
200,000
100,000
100,000
100,000
33,708
135,787
178,660
173,380
100,000
62,500
100,000
£0.001
£0.001
£0.001
24/06/2019 – 07/12/2021
07/01/2020 – 07/12/2022
21/12/2020 – 07/12/2023
£0.89
24/06/2019 – 24/06/2022
£1.20
£1.00
£1.10
£0.001
£0.001
09/07/2020 – 09/07/2024
01/04/2020 – 02/12/2024
01/07/2021 – 24/03/2025
10/08/2022 – 07/12/2024
13/10/2022 – 03/10/2025
£0.001
08/09/2023 – 07/12/2025
£0.001
£0.001
£0.001
24/06/2019 – 07/12/2021
07/01/2020 – 07/12/2022
21/12/2020 – 07/12/2023
£0.89
24/06/2019 – 24/06/2022
£1.20
£1.00
£1.10
£0.001
£0.001
09/07/2020 – 09/07/2024
01/04/2020 – 02/12/2024
01/07/2021 – 24/03/2025
10/08/2022 – 07/12/2024
13/10/2022 – 13/10/2025
£0.001
08/09/2023 – 07/12/2025
Corporate governanceCorporate governanceTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023 64
Remuneration Committee Report continued
65
Total Director share options continued
Alan Donald
Victoria Carvalho
Share option
scheme
MIP
MIP
CSOP
SSS
SSS
SSS
MIP
CSOP
MIP
MIP
MIP
CSOP
SSS
SSS
SSS
MIP
CSOP
MIP
Date of grant
07/01/2020
21/12/2020
24/06/2019
09/07/2020
24/11/2020
24/03/2021
10/08/2022
13/10/2022
08/09/2023*
07/01/2020
21/12/2020
23/08/2019
09/07/2020
24/11/2020
24/03/2021
10/08/2022
13/10/2022
08/09/2023*
Number of ordinary
shares under option
Exercise price
Vesting period
Directors’ interests
Directors who served on 31 August 2023 had interests in the shares of the Company as shown below:
Ordinary shares of 0.01p
31 August 2023
% shareholding
31 August 2022
% shareholding
150,000
75,000
33,708
58,200
77,600
77,600
80,000
62,500
80,000
16,000
16,000
25,210
32,000
42,667
42,667
16,000
62,500
16,000
£0.001
£0.001
07/01/2020 – 07/12/2022
21/12/2020 – 07/12/2023
£0.89
24/06/2019 – 24/06/2022
£1.20
£1.00
£1.10
£0.001
£0.001
09/07/2020 – 09/07/2024
01/04/2020 – 02/12/2024
01/07/2021 – 24/03/2025
10/08/2022 – 07/12/2024
13/10/2022 – 13/10/2025
£0.001
08/09/2023 – 07/12/2025
£0.001
£0.001
07/01/2020 – 07/12/2022
21/12/2020 – 07/12/2023
£0.89
23/08/2019 – 23/08/2022
£1.20
£1.00
£1.10
£0.001
£0.001
09/07/2020 – 09/07/2024
01/04/2020 – 02/12/2024
01/07/2021 – 24/03/2025
10/08/2022 – 07/12/2024
13/10/2022 – 13/10/2025
£0.001
08/09/2023 – 07/12/2025
Executive
Alex Cheatle
Andrew Long
Alan Donald
Victoria Carvalho
Non-Executive
Bruce Weatherill
Jules Pancholi
Gillian Davies
11,185,808
3,100,000
125,009
88,493
1,000,000
428,664
50,000
13.18
3.67
0.15
0.11
1.18
0.51
0.06
11,185,808
4,000,000
125,009
—
1,000,000
428,664
40,000
13.36
4.78
0.15
—
1.19
0.51
0.05
If you have any comments or questions on anything contained within this Remuneration Report, I will be available at the AGM.
Jules Pancholi
Chairman of the Remuneration Committee
21 November 2023
* Granted post end of year.
Non-Executive Directors are not awarded share options.
Fees paid for remuneration-related services
The Group paid £nil in fees for remuneration-related services during the period.
Corporate governanceCorporate governanceTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023 66
Nomination Committee Report
67
Appointment of new Executive Director
In its ongoing commitment to optimise the Board’s
composition, ensuring a diverse and skilled leadership team,
the Committee recommended the appointment of Victoria
Carvalho as Executive Director.
As the Chief Proposition Officer since November 2022 and a
vital member of the Senior Leadership Team since April 2018,
Victoria’s strategic expertise in operational growth has
significantly contributed to shaping Ten’s unique proposition.
With over 20 years of experience, including key roles at
Nasdaq and Thomson Reuters, she brings valuable insights to
the Board.
The Board accepted the Committee’s recommendation,
appointing Victoria as Executive Director on 22 February 2023.
At the same time, Sarah Hornbuckle stepped down as Executive
Director, continuing in the role of Client Services Director.
Jules Pancholi
Chairman of the Nomination Committee
21 November 2023
As the newly appointed Chairman of the
Nomination Committee, succeeding Bruce
Weatherill who stepped down due to ill health
on 8 November 2023, I express my sincere
gratitude to Bruce for his dedicated service.
Bruce, serving as Chairman of the Nomination Committee
since IPO, established and maintained robust procedures to
ensure an optimal balance of skills, experience, and
independence on the Board and its Committees, aligning with
the Group’s evolving needs. Before stepping down, he
oversaw orderly succession planning for the Board
Chairmanship and the appointment of two new Non-
Executive Directors, preparing the Board for the opportunities
and challenges ahead.
In this new role, I am committed to maintaining the Committee’s
primary function of establishing and sustaining strong procedures
for Board appointments, ensuring the optimal balance of skills,
experience, and diversity. The Committee actively contributes
recommendations to the Board concerning new appointments,
the re-election of Directors, succession planning, and the overall
composition of the Board, with a specific focus on the advantages
of fostering diversity within the Board.
Members of the Committee
During the year, Bruce Weatherill (Non-Executive Director),
served as Chairman of the Committee, alongside me, Jules
Pancholi (Non-Executive Chairman) and Alex Cheatle (Group
CEO). Additionally, Gillian Davies, a Non-Executive Director,
was appointed to the Committee on 29 July 2023.
Since the end of the period, I succeeded Bruce as Chairman
of the Committee on 8 November 2023. The composition of
the Committee ensures a comprehensive and balanced
perspective in the Committee’s discussions.
The Committee held two scheduled meetings during the
period. The main duties of the Committee are set out in its
terms of reference, which are available on the Group’s
website (www.tenlifestylegroup.com/investors).
Business of the Committee
The Nomination Committee convened twice during the period
to deliberate on succession planning for the Executive and
Non-Executive Board, its Committees, and other senior
managers. The discussions considered the challenges and
opportunities facing the Group, evaluating the requisite skills
and expertise needed for future Board dynamics. Additionally,
the Committee engaged in a reflective assessment of Board
and senior management diversity. Recognising the Group’s
strides in gender diversity, the Committee explored avenues to
further enhance diversity and inclusion within the organisation.
Appointment of new Non-Executive Directors
Upon learning of Bruce’s intention to step down, the
Nomination Committee initiated a comprehensive search
for Non-Executive Directors to complement the Board’s
skills and meet the evolving needs of the business.
Engaging a search agency, we received over 300 applications
and conducted multiple interview stages. Two candidates,
Edward Knapp and Carolyn Jameson, were identified as
suitable and recommended to the Board.
Edward, a seasoned global business leader, brings extensive
experience in technology, growth strategy, risk management,
and transformation, having held executive roles in prominent
organizations such as McKinsey & Company, Barclays, HSBC,
and Revolut.
Carolyn, with vast executive and non-executive international
experience, excels in technology, travel, and customer
experience environments, demonstrating strong leadership
skills in fast-growth settings.
The Board accepted the Committee’s recommendations,
appointing Edward to the Audit and Risk Committee and
Carolyn to the Remuneration Committee on 8 November 2023.
At the same time, Gillian Davies, Non-executive Director and
Chair of the Audit Committee, expressed her intention to step
down after more than a six-year tenure, effective at the
conclusion of the AGM in February 2024.
Appointment of new Chairman
Upon learning of Bruce’s intention to step down, the
Nomination Committee initiated a comprehensive process
to select the most suitable candidate for the role of
Chairman. This process involved consultations with
search agencies and stakeholders.
After careful consideration of the merits of searching for
external candidates, the Nomination Committee, excluding
Jules, recommended to the Board the appointment of Jules
Pancholi, serving as a Non-Executive Director, as the
incoming Chairman.
Jules brings a wealth of experience in driving value creation
through growth, technology, and product-market fit, having
served in various executive and non-executive positions,
including as a non-executive director of Skyscanner and
Chair of Oritain. His expertise and track record made him
the best choice for the position.
The Board (excluding Jules) accepted the Committee’s
recommendation, appointing Jules as Chairman of the
Board and Nomination Committee on 8 November 2023.
I am pleased to present
the report on behalf of
the Nomination Committee
for the period ended
31 August 2023.”
Jules Pancholi
Chairman of the Nomination Committee
Corporate governanceCorporate governanceTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023 68
Directors’ Report
69
The Directors present their annual
report and financial statements
for the year ended 31 August 2023
Directors
The Directors who held office during the year and up to the
date of signature of the financial statements were as follows:
Alex Cheatle
Andrew Long
Alan Donald
Bruce Weatherill (resigned 8 November 2023)
Jules Pancholi
Gillian Davies
Sarah Hornbuckle (resigned 22 February 2023)
Victoria Carvalho (appointed 22 February 2023)
Edward Knapp (appointed 8 November 2023)
Carolyn Jameson (appointed 8 November 2023)
Financial risk management objectives and
policies
Further detailed commentary on financial risk management
is included in note 31.
Liquidity risk
The Group seeks to manage financial risk by ensuring
sufficient liquidity is available to meet foreseeable needs and
to invest cash assets safely and profitably. Short-term
flexibility is achieved by holding significant cash balances in
major currencies, notably UK Sterling and the US Dollar as
well as through short-term lending through the invoice
financing facility.
Credit risk
The principal credit risk for the Group arises from its trade
receivables. In order to manage credit risk corporate clients
can be required to pay in advance of services being provided
and credit controllers regularly review credit limits in
conjunction with debt ageing and collection history.
As at 31 August 2023, a provision of £0.4m (2022: £0.3m) was
recognised against balances with reasonable credit risk.
Foreign exchange risk
The Group has significant operations in both the UK and
overseas. Profits are exposed to variations in exchange rates
and therefore reported profits. There is some natural hedging
of transactional foreign exchange risk; however, the Group
remains subject to translation exchange risk.
Overseas branches
The Group has three branches outside the United Kingdom
located in Dubai, Colombia and Argentina.
Research and development
The Group continues to dedicate resources to further develop
the bespoke TenMAID platform and the member-facing Ten
Digital Platform offering to its partners. Expenses incurred
are capitalised when it is probable that future economic
benefits will be attributable to the asset and that these costs
can be measured reliably (see note 17).
Trading review and future developments
The review of trading, future developments and key
performance indicators can be found in the Strategic report.
Substantial shareholders
As of 31 August 2023, the shareholders listed below had
notified the Company of a disclosable interest of 3% or more
in the nominal value of the ordinary share capital of the Group.
Number of
ordinary
shares
Percentage
of ordinary
shares %
Alex Cheatle
11,185,808
13.33
Canaccord Genuity Wealth
Management
Credit Saison Co. Ltd.
Lombard Odier Investment
Managers
Soros Fund Management
Andrew Long
11,099,831
6,470,000
6,337,384
4,792,785
3,100,000
Herald Investment Management
2,680,000
13.23
7.71
7.55
5.71
3.67
3.19
Purchase of own shares
During the period, the Company made purchase of own
shares of £280k (2022: £nil). The Employee Benefit Trust
made distributions of £379k (2022: £508k). On 4 July 2023,
400,000 options held by the Ten Employee Benefit Trust with
an exercise price of £0.7 were exercised, with the resulting
shares sold on the same day at a price of £0.95 per share.
Corporate governance
The Company has adopted and complies with the QCA
Corporate Governance Code for Small and Mid-Size Quoted
Companies (“QCA Code”) as set out on pages 56 and 57.
Dividends
No ordinary dividends were paid (2022: £nil). The Directors do
not recommend payment of a final dividend.
Share option schemes
Details of employee share schemes are set out in note 29 to
the financial statements.
Directors’ responsibilities
The Directors are responsible for preparing the annual report
and the financial statements in accordance with applicable
law and regulations.
Company law requires the Directors to prepare financial
statements for each financial year. Under that law the
Directors have elected to prepare the Group and Company
financial statements in accordance with UK adopted
international accounting standards. Under company law the
Directors must not approve the financial statements unless
they are satisfied that they give a true and fair view of the
state of affairs of the Group and Company and of the profit
or loss of the Group for that period. The Directors are also
required to prepare financial statements in accordance with
the rules of the London Stock Exchange for companies
trading securities on AIM. In preparing these financial
statements, the Directors are required to:
▪ select suitable accounting policies and then apply them
consistently
▪ make judgements and accounting estimates that are
reasonable and prudent
▪ state whether they have been prepared in accordance with
adopted international accounting standards., subject to any
material departures disclosed and explained in the
financial statements
In addition, the Group has:
▪ Raised a further £950k of three-year loans notes, including
£250k of loan notes subscribed for by Nitro Ventures
Limited on 21 November 2023, which constitutes a related
party transaction under the AIM Rules for Companies as
Jules Pancholi, Non-Executive Chairman, is a shareholder
and director of Nitro Ventures Limited. The loan notes are
repayable on 25 November 2026 and are guaranteed by Ten
Lifestyle Group Plc. Interest is payable quarterly in arrears
in cash at 12% per annum during the term of the loan and
a 1% administration fee is payable in cash at drawdown.
An early repayment premium will be payable by the
Company of 5% should it repay the loan notes on or before
24 November 2024 or of 3% should it repay the loan notes
on or before 24 November 2025.
▪ Extended the £1.5m loan, originally entered into in March
2022, with Mrs S Weatherill, wife of the previous Chairman
Mr B Weatherill until December 2024.
Website publication
The Directors are responsible for ensuring the annual report
and the financial statements are made available on a website.
Financial statements are published on the Group’s website in
accordance with legislation in the United Kingdom governing
the preparation and dissemination of financial statements,
which may vary from legislation in other jurisdictions. The
maintenance and integrity of the Group’s website are the
responsibility of the Directors. The Directors’ responsibility
also extends to the ongoing integrity of the financial
statements contained therein.
▪ prepare the financial statements on the going concern
basis unless it is inappropriate to presume that the
Company will continue in business
Disclosure of information to the auditor
Each of the Directors of the Company at the time when this
report was approved confirms that:
The Directors are responsible for keeping adequate
accounting records that are sufficient to show and explain
the Company’s transactions, disclose with reasonable
accuracy at any time the financial position of the Company
and enable them to ensure that the financial statements
comply with the requirements of the Companies Act 2006.
They are also responsible for safeguarding the assets of the
Company and hence for taking reasonable steps for the
prevention and detection of fraud and other irregularities.
Post-year-end events
Since the end of the year, the Group has announced the
following material contract expansions and new business wins:
▪ An existing financial services client in the Americas has
upscaled their contract with Ten following high member
engagement rates and utilization. This expansion, which will
now increase from a Medium to a Large contract, is
expected to begin generating additional revenue from
March 2024.
▪ Ten has entered into a contract with a new global Private
Bank client with customers across AMEA for our digitally
enabled travel and lifestyle service. This service is
expected to be launched across multiple markets in the
region during the first half of the calendar year 2024. Once
fully launched, this client is anticipated to equate to a
Medium contract.
▪ so far as the Director is aware, there is no relevant audit
information of which the Company’s auditor is unaware; and
▪ he or she has taken all the steps that he or she ought to
have taken as a Director in order to make himself or herself
aware of any relevant audit information and to establish
that the Company’s auditor is aware of that information.
This confirmation is given in accordance with Section 418(2)
of the Act.
Auditor
BDO LLP was appointed as auditor to the Company and, in
accordance with Section 485 of the Companies Act 2006, a
resolution proposing that it be re-appointed will be tabled at
a general meeting.
Approval
This Directors’ Report was approved on behalf of the Board
on 21 November 2023.
Alan Donald
Chief Financial Officer
21 November 2023
Corporate governanceCorporate governanceTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023 Financial Statements
70
Independent Auditor’s Report
to the members of Ten Lifestyle Group Plc
71
Opinion on the financial statements
In our opinion:
▪ the financial statements give a true and fair view of the
the Group and the Parent Company’s ability to continue as a
going concern for a period of at least twelve months from
when the financial statements are authorised for issue.
state of the Group’s and of the Parent Company’s affairs as
at 31 August 2023 and of the Group’s profit for the year
then ended;
Our responsibilities and the responsibilities of the Directors
with respect to going concern are described in the relevant
sections of this report.
▪ the Group financial statements have been properly
prepared in accordance with UK adopted international
accounting standards;
▪ the Parent Company financial statements have been properly
prepared in accordance with UK adopted international
accounting standards and as applied in accordance with the
provisions of the Companies Act 2006; and
▪ the financial statements have been prepared in accordance
with the requirements of the Companies Act 2006.
We have audited the financial statements of Ten Lifestyle
Group Plc (the ‘Parent Company’) and its subsidiaries (the
‘Group’) for the year ended 31 August 2023 which comprise
the consolidated statement of comprehensive income, the
consolidated statement of financial position, the company
statement of financial position, the consolidated statement
of changes in equity, the company statement of changes in
equity, the consolidated statement of cash flows, the
company statement of cash flows and notes to the financial
statements, including a summary of significant accounting
policies. The financial reporting framework that has been
applied in their preparation is applicable law and UK adopted
international accounting standards and, as regards the Parent
Company financial statements, as applied in accordance with
the provisions of the Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with International
Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our
responsibilities under those standards are further described
in the Auditor’s responsibilities for the audit of the financial
statements section of our report. We believe that the audit
evidence we have obtained is sufficient and appropriate to
provide a basis for our opinion.
Independence
We remain independent of the Group and the Parent
Company in accordance with the ethical requirements that
are relevant to our audit of the financial statements in the
UK, including the FRC’s Ethical Standard as applied to listed
entities, and we have fulfilled our other ethical
responsibilities in accordance with these requirements.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that
the Directors’ use of the going concern basis of accounting in
the preparation of the financial statements is appropriate.
Given our assessment of risk and the significance of this area,
we have determined going concern to be a key area of focus
for the audit. Our evaluation of the Directors’ assessment of
the Group’s and the Parent Company’s ability to continue to
adopt the going concern basis of accounting and response to
the key audit matter is included in the “Key Audit Matters”
section below.
Based on the work we have performed, we have not identified
any material uncertainties relating to events or conditions
that, individually or collectively, may cast significant doubt on
Overview
Coverage16
Key audit
matters
88% (2022: 86%) of Group Net revenue
86% (2022: 85%) of Group total assets
2022
2021
Intangible Assets:
Development costs and
amortisation
Going Concern
Recognition of deferred tax
asset
Revenue Recognition
Revenue recognition has been removed as
a Key Audit Matter in the current year
based on the specific revenue streams
reducing in magnitude this year.
Materiality Group financial statements
as a whole
£941k (2022: £460k) based on 1.5%
(2022: 1%) of Group Net revenue
16 These are areas which have been subject to a full scope audit by the
group engagement team and specified audit procedures performed by the
group engagement team.
An overview of the scope of our audit
Our Group audit was scoped by obtaining an understanding of
the Group and its environment, including the Group’s system
of internal control, and assessing the risks of material
misstatement in the financial statements. We also addressed
the risk of management override of internal controls, including
assessing whether there was evidence of bias by the Directors
that may have represented a risk of material misstatement.
The group consists of eighteen trading entities and three
branches based around the world.
Based on our assessment of the group, we focused our group
audit scope primarily over the significant components, being
Ten Lifestyle Management Limited and Ten Lifestyle
Management Switzerland GmbH. The significant components
were subject to full scope audits.
To gain sufficient coverage over the cost base we further
scoped in five non-significant entities over which limited and
specific audit procedures were performed. The entities
subject to these procedures were, Ten Lifestyle Management
USA Inc., Ten Group Japan K.K., Ten Lifestyle Management
Africa (Pty) Ltd, Ten Servicos de Concierge do Brasil Ltd and
Ten Lifestyle Management Limited S DE RL DE CV.
Desktop reviews were performed on the remaining non-
significant group entities.
All work has been performed by the Group engagement team.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial
statements of the current period and include the most significant assessed risks of material misstatement (whether or not due
to fraud) that we identified, including those which had the greatest effect on: the overall audit strategy, the allocation of
resources in the audit, and directing the efforts of the engagement team. These matters were addressed in the context of our
audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on
these matters.
Key audit matter
How the scope of our audit addressed
the key audit matter
Intangible Assets: Development costs and amortisation
Details of the Group’s
accounting policies
applied and related
disclosures are given
in notes 1.6 and 17 to
the financial
statements.
The Group capitalises costs in relation to
the development of the software used in
the delivery of services to its clients.
We determined this to be a key audit
matter as there is significant judgement
and assumptions required in the
determination of the costs to be
capitalised, and their amortisation period.
We performed the following procedures:
▪ We held discussions with the Group’s technology team
to understand the Group’s processes, procedures, and
projects in relation to development costs.
▪ We considered whether the development costs
capitalised met the criteria for capitalisation under the
applicable accounting standards.
▪ We checked the accuracy of the contractor and payroll
data, on a sample basis, included in the calculations
for capitalised costs to supporting documentation
including employment contracts and agreements with
contractors.
▪ We considered the proportion of time allocations for
employees and contractor roles and made enquiries of
management in relation to any changes to the
percentage of time capitalisation, which were outside
of expectations (based on knowledge of the business),
corroborating management’s explanations to
supporting evidence.
▪ We reviewed the reasonableness of the estimated
proportion of time allocations for a sample of
employees and contractors by making enquiries of
individual employees and reviewing written responses
to the audit team’s questionnaires, which they
completed in relation to their roles, duties and tasks
performed in relation to developing the platform asset.
▪ We assessed management’s estimate of amortisation
period applied to the asset by considering relevant
industry benchmarks.
Key observations:
Based on the procedures performed, we consider the
assumptions and judgements made in the capitalisation
of development costs and the determination of
amortisation period to be appropriate.
Financial statementsFinancial statementsTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023 72
Independent Auditor’s Report continued
to the members of Ten Lifestyle Group Plc
Key audit matters continued
Key audit matter
Going concern
Refer to note 1.4 to the
financial statement.
How the scope of our audit addressed
the key audit matter
Key audit matter
Deferred tax recognition
See accounting policy
in Note 1.13 and related
disclosures in Note 16.
The group has recognised a deferred tax
asset in respect of historic losses for the
first time in the current year. Deferred tax
assets are recognised to the extent that it
is probable that future taxable profits will
be available against which to offset the
deductible temporary differences.
We determined this to be a key audit
matter as there is significant estimation
required in the determination of the future
taxable profits that result in a deferred tax
asset recognition.
The financial statements explain how the
Board has formed a judgement that it is
appropriate to adopt the going concern
basis of preparation for the financial
statements of the Group and Parent
Company.
That judgement is based on an evaluation
of the inherent risks to the Group’s and
Company’s business model and how those
risk might affect the Group’s and
Company’s financial resources or ability to
continue operations over a period of at
least twelve months from the date of
approval of the accounts.
The risks most likely to adversely affect
the Group’s and Company’s available
financial resources and have an impact
over its ability to meet its obligations over
this period were:
Impact of the current economy reality of
uncertainty and high inflation resulting in
failure of existing customers to
successfully renew contract in the forecast
period together with high operational
costs.
Because of the significance of the
judgements in this area we considered
going concern to be a key audit matter.
We performed the following procedures:
▪ We reviewed management’s assessment of going
concern through analysis of the group’s cash flow
forecast for at least 12 months from the date of signing
the annual report and accounts
▪ We assessed the monthly cash flow forecast, with
consideration of cash inflows, based on agreed
customer contracts, and outflows based on
contractual commitments for areas such as loan
balances and payroll costs.
▪ We assessed the cash flows sensitisation analysis for
(1) Reduction in sales versus budget and (2) Cost
containment positions that can be diminished versus
budget (e.g. reduce costs or removal of any
discretionary items like bonuses) in line with the
current uncertain market conditions.
▪ We assessed and challenged the reasonableness of
the key assumptions, such as margins used and cost
inflation by management in preparing the forecasts
and the mathematical accuracy of the forecasts
looking at historical rates and detailed costs
breakdowns.
▪ We reviewed post-balance sheet events, specifically
the cash flow position against budgeted performance
to identify any unusual cash movements or indicator of
forecasts not being realistic.
▪ We reviewed the going concern disclosure in the basis
of preparation of the accounts to check it gives a full
and accurate description of the Directors assessment
of going concern including the identified risks and
corresponding assumptions
Key observations:
Based on the procedures performed we consider the
assessment made by management to be appropriate.
73
How the scope of our audit addressed
the key audit matter
We performed the following procedures:
▪ We confirmed the groups initial forecasted revenue
and related costs were in line with their going concern
assessment.
▪ We assessed the judgements and assumptions made
by management in deciding what determines taxable
profits were in the future against current year tax
adjustments and future planned changes to confirm
the reasonableness of the assumptions.
▪ We considered whether the period over which the
deferred tax asset will be recovered was reasonable
based on the forecast prepared by management and
the potential expiration dates of the losses
▪ We engaged our specialists experienced in the audit of
tax to assist with the logic in the assessment,
recalculation of the balance and the practical
application of the forward looking tax assumptions.
Key observations:
Based on the procedures performed, we consider the
estimates made in the recognition of the deferred tax
asset to be appropriate.
Financial statementsFinancial statementsTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023 74
Independent Auditor’s Report continued
to the members of Ten Lifestyle Group Plc
75
Our application of materiality
We apply the concept of materiality both in planning and performing our audit, and in evaluating the effect of misstatements.
We consider materiality to be the magnitude by which misstatements, including omissions, could influence the economic
decisions of reasonable users that are taken on the basis of the financial statements.
In order to reduce to an appropriately low level the probability that any misstatements exceed materiality, we use a lower
materiality level, performance materiality, to determine the extent of testing needed. Importantly, misstatements below these
levels will not necessarily be evaluated as immaterial as we also take account of the nature of identified misstatements, and
the particular circumstances of their occurrence, when evaluating their effect on the financial statements as a whole.
Based on our professional judgement, we determined materiality for the financial statements as a whole and performance
materiality as follows:
Group financial statements
Parent Company standalone financial statements
Materiality
Basis for determining
materiality
Rationale for the
benchmark applied
2023
£
941,000
2022
£
460,000
1.5% of
Net Revenue
1% of
Net Revenue
2023
£
906,000
1.75% of
Net asset
2022
£
874,000
1.75% of
net assets
We considered revenue to be the most
appropriate benchmark as this is the primary
key performance indicator, which is used to
address the performance of the Group by the
board and an important performance based
metric to the users of the financial statements.
The threshold change was due to improved
trading conditions and knowledge of the group
which led towards a higher materiality threshold.
As a holding company which principally holds the
investments in the group a net asset benchmark
was considered appropriate.
Performance materiality
658,000
322,000
634,000
611,800
Basis for determining
performance materiality
Rationale for the
percentage applied for
performance materiality
Performance materiality was set at 70% (2022: 70%) of overall materiality.
In reaching our conclusion on the level of performance materiality to be applied for 2023 we
considered a number of factors including the expected total value of known and likely
misstatements (based on past experience), our knowledge of the group’s internal controls and
management’s attitude towards proposed adjustments.
Component materiality
For Group reporting purposes, we set materiality for each component of the Group, including the Parent Company, based on a
percentage of between 23% and 80% (2022: 4% and 75%) of Group materiality dependent on the size and our assessment of the
risk of material misstatement of that component. Component materiality ranged from £216,000 to £752,000 (2022: £84,000 to
£345,000). In the audit of each component, we further applied performance materiality levels of 70% (2022: 70%) of the
component materiality to our testing to ensure that the risk of errors exceeding component materiality was appropriately
mitigated. Where balances were noted within the Parent Company relevant to the Group consolidated results our work was
performed based on materiality capped at 75% of the Group materiality.
Reporting threshold
We agreed with the Audit Committee that we would report to them all individual audit differences in excess of £47,000 (2022:
£23,000). We also agreed to report differences below this threshold that, in our view, warranted reporting on qualitative grounds.
Other information
The directors are responsible for the other information. The other information comprises the information included in the Annual
Report and Accounts other than the financial statements and our auditor’s report thereon. Our opinion on the financial
statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not
express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider
whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course
of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material
misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements
themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other
information, we are required to report that fact.
We have nothing to report in this regard.
Other Companies Act 2006 reporting
Based on the responsibilities described below and our work
performed during the course of the audit, we are required by
the Companies Act 2006 and ISAs (UK) to report on certain
opinions and matters as described below.
Strategic report and Directors’ report
In our opinion, based on the work undertaken in the course of
the audit:
▪ the information given in the Strategic report and the
Directors’ report for the financial year for which the
financial statements are prepared is consistent with the
financial statements; and
▪ the Strategic report and the Directors’ report have been
prepared in accordance with applicable legal requirements.
In the light of the knowledge and understanding of the Group
and Parent Company and its environment obtained in the
course of the audit, we have not identified material
misstatements in the strategic report or the Directors’ report.
Matters on which we are required to report
by exception
We have nothing to report in respect of the following matters
in relation to which the Companies Act 2006 requires us to
report to you if, in our opinion:
▪ adequate accounting records have not been kept by the
Parent Company, or returns adequate for our audit have not
been received from branches not visited by us; or
▪ the Parent Company financial statements are not in
agreement with the accounting records and returns; or
▪ certain disclosures of Directors’ remuneration specified by
law are not made; or
▪ we have not received all the information and explanations
we require for our audit.
Responsibilities of Directors
As explained more fully in the Directors’ responsibilities
statement, the Directors are responsible for the preparation
of the financial statements and for being satisfied that they
give a true and fair view, and for such internal control as the
Directors determine is necessary to enable the preparation of
financial statements that are free from material
misstatement, whether due to fraud or error.
In preparing the financial statements, the Directors are
responsible for assessing the Group’s and the Parent
Company’s ability to continue as a going concern, disclosing,
as applicable, matters related to going concern and using the
going concern basis of accounting unless the Directors either
intend to liquidate the Group or the Parent Company or to
cease operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of
the financial statements
Our objectives are to obtain reasonable assurance about
whether the financial statements as a whole are free from
material misstatement, whether due to fraud or error, and to
issue an auditor’s report that includes our opinion. Reasonable
assurance is a high level of assurance, but is not a guarantee
that an audit conducted in accordance with ISAs (UK) will
always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered
material if, individually or in the aggregate, they could
reasonably be expected to influence the economic decisions
of users taken on the basis of these financial statements.
Extent to which the audit was capable of
detecting irregularities, including fraud
Irregularities, including fraud, are instances of non-compliance
with laws and regulations. We design procedures in line with
our responsibilities, outlined above, to detect material
misstatements in respect of irregularities, including fraud.
The extent to which our procedures are capable of detecting
irregularities, including fraud is detailed below:
Non-compliance with laws and regulations
Based on:
▪ Our understanding of the Group and the industry in which
it operates;
▪ Discussion with management and those charged with
governance and the Audit and Risk Committee, and
inspection of written information from external legal
counsel; and
▪ Obtaining an understanding of the Group’s policies and
procedures regarding compliance with laws and
regulations;
We considered the significant laws and regulations to be
UK-adopted international accounting standards, UK and
international direct, indirect and employment tax legislation,
AIM Listing Rules, the Companies Act 2006, and the QCA code.
The Group is also subject to laws and regulations where the
consequence of non-compliance could have a material effect
on the amount or disclosures in the financial statements, for
example through the imposition of fines or litigations. We
identified such laws and regulations to be Health and Safety
and the Bribery Act 2010 and equivalent legislation and
regulation where the Group has overseas operations. In
addition, changes to legislation affecting all UK companies
such as tax legislation and developments can give rise to
contingent or actual liabilities in the event of non-compliance.
Our procedures in respect of the above included:
Financial statementsFinancial statementsTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023 76
Independent Auditor’s Report continued
to the members of Ten Lifestyle Group Plc
Consolidated Statement of Comprehensive Income
for the year ended 31 August 2023
77
We also communicated relevant identified laws and
regulations and potential fraud risks to all engagement team
members who were all deemed to have appropriate
competence and capabilities and remained alert to any
indications of fraud or non-compliance with laws and
regulations throughout the audit.
Our audit procedures were designed to respond to risks of
material misstatement in the financial statements,
recognising that the risk of not detecting a material
misstatement due to fraud is higher than the risk of not
detecting one resulting from error, as fraud may involve
deliberate concealment by, for example, forgery,
misrepresentations or through collusion. There are inherent
limitations in the audit procedures performed and the further
removed non-compliance with laws and regulations is from
the events and transactions reflected in the financial
statements, the less likely we are to become aware of it.
A further description of our responsibilities is available
on the Financial Reporting Council’s website at:
www.frc.org.uk/auditorsresponsibilities. This description
forms part of our auditor’s report.
Use of our report
This report is made solely to the Parent Company’s members,
as a body, in accordance with Chapter 3 of Part 16 of the
Companies Act 2006. Our audit work has been undertaken
so that we might state to the Parent Company’s members
those matters we are required to state to them in an
auditor’s report and for no other purpose. To the fullest
extent permitted by law, we do not accept or assume
responsibility to anyone other than the Parent Company and
the Parent Company’s members as a body, for our audit work,
for this report, or for the opinions we have formed.
Matthew Haverson (Senior Statutory Auditor)
For and on behalf of BDO LLP, Statutory Auditor
London, United Kingdom
BDO LLP is a limited liability partnership registered in England
and Wales (with registered number OC305127).
Revenue
Cost of sales on principal member transactions
Net Revenue
Other cost of sales
Gross profit
Administrative expenses
Other income
Operating profit before amortisation, depreciation, interest, share-based
payments, exceptional items and taxation ("Adjusted EBITDA")
Depreciation
Amortisation
Share-based payment expense
Exceptional items
Operating profit/(loss)
Net finance expense
Profit/(loss) before taxation
Taxation credit/(expense)
Profit/(loss) for the year
Other comprehensive (expense):
Foreign currency translation differences
Total comprehensive profit/(loss) for the year
Basic profit/(loss) per ordinary share
Diluted profit/(loss) per ordinary share
Basic underlying profit/(loss) per ordinary share
Diluted underlying profit/(loss) per ordinary share
Note
4
4
18 & 19
17
29
5
6
13
14
15
15
15
15
2023
£’000
66,656
(3,653)
63,003
(2,032)
60,971
(60,012)
836
12,004
(2,916)
(5,287)
(908)
(1,098)
1,795
(871)
924
3,623
2022
£’000
48,651
(1,839)
46,812
(1,428)
45,384
(49,519)
386
4,878
(2,713)
(4,608)
(537)
(769)
(3,749)
(101)
(3,850)
(466)
4,547
(4,316)
(564)
(137)
3,983
(4,453)
5.4p
5.2p
0.4p
0.4p
(5.2)p
(5.2)p
(4.2)p
(4.2)p
The consolidated statement of comprehensive income has been prepared on the basis that all operations are continuing operations.
Auditor’s responsibilities for the audit of
the financial statements continued
▪ Review of minutes of meeting of those charged with
governance for any instances of non-compliance with laws
and regulations;
▪ Review of correspondence with regulatory and tax
authorities for any instances of non-compliance with laws
and regulations;
▪ Review of financial statement disclosures and agreeing to
supporting documentation;
▪ Involvement of tax specialists in the audit;
▪ Review of legal expenditure accounts to understand the
nature of expenditure incurred; and
▪ Evaluating recent developments in regulation for
applicability to the Group’s operations and determining
whether any impact on the financial statements has been
properly addressed by the Directors.
Fraud
We assessed the susceptibility of the financial statements to
material misstatement, including fraud. Our risk assessment
procedures included:
▪ Enquiry with management and those charged with governance
regarding any known or suspected instances of fraud;
▪ Obtaining an understanding of the Group’s policies and
procedures relating to:
▪ Detecting and responding to the risks of fraud; and
▪ Internal controls established to mitigate risks related
to fraud.
▪ Review of minutes of meeting of those charged with
governance for any known or suspected instances of fraud;
▪ Discussion amongst the engagement team as to how and
where fraud might occur in the financial statements;
▪ Performing analytical procedures to identify any unusual
or unexpected relationships that may indicate risks of
material misstatement due to fraud;
▪ Considering remuneration incentive schemes and
performance targets and the related financial statement
areas impacted by these; and
Based on our risk assessment, we considered the areas most
susceptible to fraud to be inappropriate journal entries
relating to revenue recognition and the exertion of bias in
accounting estimates.
Our procedures in respect of the above included:
▪ Challenging the assumptions and judgements made by
management in their significant accounting estimates and
judgements which are disclosed on pages 80 and 81,
through examination and assessment of contradictory as
well as corroborative evidence that we researched
independently as well as received from the Group;
▪ Identifying and testing a sample of journal entries, in
particular journal entries posted with unusual account
combinations primarily in revenue, to supporting
documentation.
▪ Performing the procedures as set out in the Key Audit
Matters section of our report.
Financial statementsFinancial statementsTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023
78
Consolidated Statement of Financial Position
as at 31 August 2023
Consolidated Statement of Changes in Equity
for the year ended 31 August 2023
79
Company No: 08259177
Non-current assets
Intangible assets
Property, plant and equipment
Right of use assets
Deferred tax asset
Total non-current assets
Current assets
Inventories
Trade and other receivables
Cash and cash equivalents
Total current assets
Total assets
Current liabilities
Trade and other payables
Provisions
Lease liabilities
Borrowings
Total current liabilities
Net current liabilities
Non-current liabilities
Borrowings
Lease liabilities
Total non-current liabilities
Total liabilities
Net assets
Equity
Called up share capital
Share premium account
Merger relief reserve
Treasury reserve
Foreign exchange reserve
Retained deficit
Total equity
Note
2023
£’000
2022
£’000
Called up
share
capital
£’000
Share
premium
account
£’000
Merger
relief
reserve
£’000
Foreign
exchange
reserve
£’000
Note
Treasury
reserve
£’000
Retained
deficit
£’000
Total
£’000
Balance at 31 August 2021
Loss for the year
Foreign exchange
Total comprehensive loss for the year
Issue of new share capital
Shares purchased by Employee Benefit
Trust (EBT)
Equity-settled share-based payments charge
29
Balance at 31 August 2022
Profit for the year
Foreign exchange
Total comprehensive income for the year
Employee Benefit Trust (EBT) costs
Equity-settled share-based payments charge
29
Issue of new share capital
82
—
—
—
2
—
—
84
—
—
—
—
—
1
29,356
1,993
—
—
—
1,302
—
—
—
—
—
—
—
—
30,658
1,993
—
—
—
—
—
614
—
—
—
—
—
—
(410)
—
(137)
(137)
—
—
—
(547)
—
(564)
(564)
—
—
—
5
(19,079)
11,947
—
—
—
—
(4,316)
(4,316)
—
(137)
(4,316)
(4,453)
—
1,304
508
—
—
537
513
(22,858)
4,547
508
537
9,843
4,547
—
—
—
93
—
—
—
(564)
4,547
3,983
—
629
—
93
629
615
Balance at 31 August 2023
85
31,272
1,993
(1,111)
606
(17,682)
15,163
17
18
19
16
21
23
24
25
27
26
26
27
28
15,394
912
1,911
4,297
13,397
939
2,274
—
22,514
16,610
511
11,608
8,229
118
9,930
6,584
20,348
16,632
42,862
33,242
(20,059)
(16,459)
(931)
(1,738)
(1,622)
(846)
(1,834)
(1,500)
(24,350)
(20,639)
(4,002)
(4,007)
(2,950)
(399)
(1,940)
(820)
(3,349)
(2,760)
(27,699)
(23,399)
15,163
9,843
85
31,272
1,993
606
(1,111)
84
30,658
1,993
513
(547)
(17,682)
(22,858)
15,163
9,843
The financial statements were approved by the Board of Directors and authorised for issue on 21 November 2023 and are signed
on its behalf by:
Alex Cheatle
Director
Alan Donald
Director
Financial statementsFinancial statementsTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023
80
Consolidated Statement of Cash Flows
for the year ended 31 August 2023
Notes to the Financial Statements
81
Cash flows from operating activities
Profit/(loss) for the year, after tax
Adjustments for:
Taxation (credit)/expense
Net finance expense
Amortisation of intangible assets
Depreciation of property, plant and equipment
Depreciation of right of use asset
Equity-settled share-based payment expense
Exceptional items
Movement in working capital:
Increase in inventories
Increase in trade and other receivables
Increase in trade and other payables
Cash generated from operations
Tax paid
Net cash generated from operating activities
Cash flows from investing activities
Purchase of intangible assets
Purchase of property, plant and equipment
Finance income
Net cash used by investing activities
Cash flows from financing activities
Lease liability repayments
Sale of treasury shares
Net receipts from invoice financing
Interest paid
Interest paid on IFRS 16 lease liabilities
Cash receipts from issue of share capital
Loan receipts – loan notes
Net cash (used by)/generated from by financing activities
Foreign currency cash and cash equivalents movements
Net increase/(decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of the period
Cash and cash equivalents at end of the period
Cash at bank and in hand
Cash and cash equivalents
Note
2023
£’000
2022
£’000
4,547
(4,316)
14
13
17
18
19
29
5
17
18
13
27
26
27
(3,623)
871
5,287
511
2,405
629
427
(393)
(1,222)
2,106
11,545
(826)
10,719
(7,284)
(531)
7
466
101
4,608
483
2,230
537
769
(18)
(2,012)
2,020
4,868
(623)
4,245
(6,452)
(866)
1
(7,808)
(7,317)
(2,538)
(2,427)
102
122
(442)
(216)
615
1,185
(1,172)
(94)
1,645
6,584
8,229
8,229
508
—
(73)
(185)
1,302
3,440
2,565
429
(78)
6,662
6,584
6,584
1. Accounting policies
Company information
Ten Lifestyle Group Plc (registered company 08259177) is a public company, limited by shares and listed on the Alternative
Investment Market (AIM) in November 2017. The Company is incorporated and domiciled in the UK. The registered office is
2nd Floor, 355 Euston Road, London NW1 3AL. The Company previously traded under the name Ten Lifestyle Holdings Limited
until 2 November 2017.
1.1 Basis of preparation
The financial statements have been prepared in accordance with International Accounting Standards in conformity with the
requirements of the Companies Act 2006 (‘IFRS’) and with those parts of the Companies Act 2006 applicable to companies
reporting under IFRS (except as otherwise stated).
The financial information has been prepared on the historical cost basis.
The financial statements are prepared in Sterling, which is the functional currency of the Company. Monetary amounts in these
financial statements are rounded to the nearest £’000.
The accounting policies set out below have, unless otherwise stated, been applied consistently to all years presented in this
financial information.
The preparation of financial statements in conformity with IFRS requires the use of certain critical accounting estimates. It also
requires management to exercise its judgement in the process of applying the Group’s accounting policies. The areas involving a
higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the consolidated
financial statements, are disclosed in note 3.
There are no new standards that are not yet effective and that would be expected to have a material impact on the entity in the
current or future reporting periods.
1.2 Consolidation
The financial information represents the consolidated financial information of the Company and its subsidiaries (the “Group”) as
if they formed a single entity. Intercompany transactions and balances between Group companies are therefore eliminated in
full. The results of subsidiary undertakings are included in the consolidated statement of comprehensive income from the date
that control commences until the date that control ceases. The Company controls a subsidiary/investee if all three of the
following elements are present: power over the investee, exposure to variable returns from the investee, and the ability of the
investor to use its power to affect those variable returns. Control is reassessed whenever facts and circumstances indicate that
there may be a change in any of these elements of control. In assessing control, the Group takes into consideration potential
voting rights that are currently exercisable.
In the year ended 31 August 2013, Ten Lifestyle Group Plc, formerly Ten Lifestyle Holdings Limited, a company under common
control of the Ten Lifestyle Management Limited shareholders, acquired Ten Lifestyle Management Limited from its
shareholders in return for an issue of shares. As a combination of entities under common control, the transaction falls outside
the scope of the standard IFRS 3 “Business Combinations”.
Paragraph 10 of IAS 8 “Accounting Policies, Changes in Accounting Estimates and Errors” requires management to use its
judgement in developing and applying a policy that is relevant and reliable, represents faithfully the transaction, reflects the
economic substance of the transaction, is neutral, is prudent, and is complete in all material respects when selecting the
appropriate methodology for consolidation accounting.
In accordance with merger accounting, consolidated accounts have been prepared for the reconstructed Group as if it had
always been in existence. The carrying value of assets and liabilities has not been adjusted to fair value. The difference between
the nominal value of the shares issued and the nominal value of the shares received has been recorded in the merger reserve.
The cost of the Company’s shares held by the Employee Benefit Trust (EBT) is deducted from equity in the consolidated
statement of financial position. Any cash received by the EBT on disposal of the shares it holds is also recognised directly in
equity. Other assets and liabilities of the EBT are recognised as assets and liabilities of the Group other than when they relate
to other Group companies and are therefore eliminated.
1.3 Segment reporting
The Group’s operating segments are based on the management reporting used by the CEO (who is considered to be the chief
operating decision maker) and reviewed by the Board of Directors to make strategic decisions and allocate resources.
1.4 Going concern
The consolidated financial statements have been prepared on a going concern basis. The ability of the Company to continue as
a going concern is contingent on the ongoing viability of the Group. The Group meets its day-to-day working capital
requirements through its cash balances and wider working capital management. The current political and economic conditions
continue to create some uncertainty, particularly over (a) corporate members’ engagement; and (b) supplier revenue volumes.
The Group’s forecasts and projections, taking account of reasonably possible changes in trading performance, show that the
Group expects to be able to operate within the level of its current cash resources. Having assessed the principal risks and the
other matters discussed in connection with the going concern statement, the Directors considered it appropriate to adopt the
going concern basis of accounting in preparing the consolidated financial statements.
Financial statementsFinancial statementsTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023 82
83
1. Accounting policies continued
1.4 Going concern continued
Whilst the Company has grown significantly post the COVID-19 pandemic, continued management of costs is in place to ensure
operating performances align to the Board’s expectations. The Board believes that the business is able to navigate through any
macroeconomic conditions that may impact performance due to the strength of its member proposition, its balance sheet, and
the net cash position of the Group.
The Group has set its budget for 2024 and forecast for the following year but we recognise that there are scenarios under which
the Group could be impacted by reductions in the number of member engagements and by prospective corporate clients failing
to renew contracts. From our budget base case, a stress scenario of 20% reduction in variable revenues was performed as well
as a severe downside scenario of 90% reduction in variable revenues. In each of these scenarios, if revenue is not in line with
cash flow forecasts, the Directors have identified cost savings associated with the reduction in revenue and can identify further
cost savings if necessary to ensure there is adequate cash and day-to-day working capital going forward.
Having assessed the principal risks and other matters discussed in connection with the going concern statement, the Directors
have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable
future. For these reasons, they continue to adopt the going concern basis of accounting in preparing the financial statements.
1.5 Revenue
Revenue comprises concierge revenue (from corporate clients and the private membership base), supplier revenue, and other
revenue generated from member transactions. An entity is a principal if it controls the specified good or service before that
good or service is transferred to a customer. The Group is principal in all services provided, other than in those transactions
with members detailed below in the indirect concierge service revenue section. A typical concierge contract duration is 36
months. Revenue is stated exclusive of VAT, sales tax, and trade discounts.
Revenue is recognised when the Group has fulfilled its performance obligations under the relevant customer contract. To the
extent that invoices are raised to a different pattern than the revenue recognition described below, appropriate adjustments are
made through deferred and accrued income to account for revenue when the performance obligations have been met.
Furthermore, the Group receives payments from members for the concierge service which are invoiced on 30-day payment
terms and commissions earned on agent transactions are generally received on booking dates or when deposits are due.
The Group primarily provides a concierge service (both online and/or offline). Where goods and/or services are sold in one
bundled transaction, the Group allocates the total arrangement’s consideration to the different individual elements based on
their relative fair values. Management determines the fair values of individual components based on actual amounts charged by
the Group on a standalone basis given the lack of comparable pricing arrangements observable in the market.
The nature, timing of satisfaction of performance obligations, and significant payment terms of revenue obtained by the Group
are considered below:
Direct concierge service revenue
The Group provides concierge services to its members (online and/or offline) and recognises concierge consideration at the
point in time the performance obligation of managing a request is fulfilled. The Group uses the residual approach to determine
the transaction price given the lack of observable market prices available as well as the niche nature of the services provided.
Where the Group’s performance of its obligations exceeds amounts received, accrued income or a trade receivable is
recognised depending on the Group’s billing rights. Where the Group’s performance of its obligations under a contract is less
than amounts received, a contract liability in deferred income is recognised. The amount of revenue recognised can be subject
to contract structures including variable consideration and cap and collar thresholds. Where variable pricing structures are in
place with predetermined service thresholds, price per service unit is therefore based on the expected entitlement (most likely
method) earned up to the statement of financial position date under each customer agreement.
On implementing a customer contract, it is typical for the Group to charge concierge enabling fees. Where concierge enabling
fees are capable of being separated out from an ongoing service contract, revenue will be recognised in full at the point in time
of the launch of the service (high touch or online). When the service is not distinct, this cannot be separated from the contract
and is recognised over the contract term. Where the service is invoiced in advance and is yet to be launched (i.e. the
performance obligation is not fulfilled), a contract liability will be held on the statement of financial position in deferred income.
1. Accounting policies continued
1.5 Revenue continued
Indirect concierge service revenue
Acting as agent (supplier revenue)
The Group acts as an agent when it is not the primary party responsible for providing the components that make up the
members’ booking and does not control the components before they are transferred to members. Revenue comprises the
fair value of the consideration received or receivable in the form of commission. Commissions are earned from the member
through purchases of travel products such as hotel accommodation or flight tickets from third party suppliers. Commission
is recognised when the performance obligation of arranging and facilitating the member to enter into individual contracts with
suppliers is satisfied, usually on delivery of the booking confirmation.
Cancellations are estimated at the reporting date based on the historical profile of cancellations. Revenue is stated net of
cancellations and expected cancellations.
Acting as principal (supplier revenue)
The Group acts as a principal when it is the primary party responsible for providing the components that make up the members’
booking and it controls the components before transferring to the member. Revenue represents amounts received or receivable
for the sale of package holidays and other services supplied to members. Revenue is recognised when the performance
obligation on delivering an integrated package holiday or service is satisfied, usually over the duration of the holiday.
Service fees and offer income
These are related to corporate clients (corporate revenue) and recognised over the year to which the fees or offer relate. Where
invoiced in advance, the fees and offer income are deferred and released over the year of the service with the balance recorded
within deferred income in the statement of financial position.
Digital platform revenue
The Group provides an optional digital platform (the “Ten Digital Platform”) offering to its customers under corporate contracts
(corporate revenue). Revenue generated from licensing digital products and software maintenance is recognised on a straight
line basis over time attributed to the licence.
The nature of the Group’s promise in granting a licence is a promise to provide a right to access the Group’s intellectual
property as the customer benefits from periodic upgrades to the platform.
Where such revenue is invoiced in advance, the revenue is deferred and released over the period of the licence with the
contract liability recorded within deferred income in the statement of financial position.
Revenue generated from developing digital products is recognised at the point in time of the delivery of the service. Where
revenue is based on time spent, rate cards are recognised at the contracted rates as labour hours are incurred. Where
development income is invoiced in advance, the revenue is deferred as a contract liability with the balance recorded within
deferred income in the statement of financial position and released on service delivery.
1.6 Intangible assets
Research expenditure is expensed to the income statement in the year in which it is incurred; expenditure on internal projects is
capitalised if it can be demonstrated that:
▪ it is technically and commercially feasible to develop the asset for future economic benefit;
▪ adequate resources are available to maintain and complete the development;
▪ there is the intention to complete and develop the asset for future economic benefit;
▪ the Group is able to use the asset;
▪ use of the asset will generate future economic benefit; and
▪ expenditure on the development of the asset can be measured reliably.
Other development expenditure is recognised in the income statement as an expense as incurred.
Capitalised development expenditure is stated at cost less accumulated amortisation and less accumulated impairment losses.
Amortisation is charged to the income statement on a straight line basis over the estimated useful lives of intangible assets.
Intangible assets are amortised from the date they are available for use. The estimated useful lives are as follows:
Trademarks
10 years straight line
Capitalised development costs
5 years straight line
Website
3 years straight line
The basis for choosing these useful lives is with reference to the years over which they can continue to generate value for the Group.
The amortisation charges are included within administrative expenses is in the consolidated statement of comprehensive
income. The Group reviews the amortisation year and methodology when events and circumstances indicate that the useful
lives may have changed since the last reporting date.
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85
1. Accounting policies continued
1.7 Property, plant and equipment
Property, plant and equipment are measured at historical cost, less accumulated depreciation, and accumulated impairment losses.
1. Accounting policies continued
1.13 Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Depreciation is charged to the income statement on a straight line basis over the estimated useful lives of property, plant and
equipment. Property, plant and equipment are depreciated from the date they are available for use. The estimated useful lives
are as follows:
Leasehold improvements
Over the term of the lease
Fixtures and fittings
5 years straight line
Office equipment
3 to 5 years straight line
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying
value of the asset and is recognised in the income statement.
1.8 Non-current investments
The Company’s interests in subsidiaries are initially measured at cost, and subsequently measured at cost less any
accumulated impairment losses.
1.9 Impairment of tangible and intangible assets
All tangible and intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the
carrying amount might not be recoverable. An impairment loss is recognised for the amount by which the asset’s carrying
amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs of disposal
and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are largely
independent cash inflows (CGUs).
1.10 Financial assets
The Group reviews the amount of credit loss associated with its trade receivables based on a provision matrix and forward-
looking estimates that consider current and forecast credit conditions as opposed to relying solely on past historical default rates.
The Group has applied the simplified approach by applying a provision matrix based on number of days past due to measure
lifetime expected credit losses. This takes into account the applicable customer credit risk profile and current and forecast
trading conditions.
All financial assets are held under the business model of holding the assets to collect the contractual cash flows arising from
them, which are made up solely of payments of the principal and interest. Therefore, all financial assets are classified at
amortised cost.
Except for trade receivables, financial assets are initially recognised at fair value plus transaction costs that are directly
attributable to their acquisition or issue and are subsequently carried at amortised cost using the effective interest rate
method, less provision for impairment.
Trade receivables do not contain significant financing components and therefore are initially recognised at their transaction price,
and subsequently treated in line with other financial assets. Except for trade receivables, impairment provisions are recognised
as an expected credit loss provision under the general approach, being the expected credit loss over the next twelve months.
Where there is a credit risk on a financial asset that has increased significantly, the impairment provision is measured at the
lifetime expected credit loss. Impairment for trade receivables will be measured under the simplified approach with an
expected credit loss percentage applied to each ageing category. All financial assets will be reported net of impairment; when
the Group has no reasonable expectation of recovering a financial asset, the portion that is not recoverable is derecognised.
These financial assets comprise trade and other receivables, accrued income, and cash and cash equivalents in the
consolidated statement of financial position. Cash and cash equivalents include cash in hand, deposits held with banks and
other short-term highly liquid investments with original maturities of three months or less.
1.11 Financial liabilities
Financial liabilities include trade payables and other short-term monetary liabilities, which are initially recognised at fair value
and subsequently carried at amortised cost using the effective interest method.
1.12 Equity instruments
Equity instruments issued by the Company are recorded at the proceeds received, net of direct issue costs. Dividends payable
on equity instruments are recognised as liabilities once they are no longer at the discretion of the Company.
Current tax
Any tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the income
statement because it excludes items of income or expense that are taxable or deductible in other years and it further excludes
items that are never taxable or deductible. The Company’s liability for current tax is calculated using tax rates that have been
enacted or substantively enacted by the reporting end date.
Research and development tax credit
Companies within the Group may be entitled to claim special tax allowances in relation to qualifying research and development
(R&D) expenditure (e.g. R&D tax credits). The Group accounts for such allowances as tax credits, which means that they are
recognised when it is probable that the benefit will flow to the Group and that benefit can be reliably measured. They are claimed
through the research and development expenditure credit (RDEC) tax credit scheme and recognised in the financial statements
through other income on the income statement and other receivables on the balance sheet, until the cash is received.
Deferred tax
Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and
liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit, and is
accounted for using the balance sheet liability method. Deferred tax liabilities are generally recognised for all taxable temporary
differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against
which deductible temporary differences can be utilised. Such assets and liabilities are not recognised if the temporary
difference arises from the initial recognition of other assets and liabilities in a transaction that affects neither the taxable profit
nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer
probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is
calculated at the tax rates that are expected to apply in the year when the liability is settled, or the asset is realised. Deferred
tax is recorded in the income statement unless it relates to items in “other comprehensive income”, in which case the deferred
tax is recorded in “other comprehensive income”. Deferred tax assets and liabilities are offset when the Company has a legally
enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by
the same tax authority.
1.14 Provisions
Provisions are recognised when the Group has a legal or constructive present obligation as a result of a past event, it is probable
that the Group will be required to settle that obligation, and a reliable estimate can be made of the amount of the Group
obligation.
The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the
reporting end date, taking into account the risks and uncertainties surrounding the obligation. Where a provision is measured
using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows.
When some or all of the economic benefits required to settle a provision are expected to be recovered from a third party, a
receivable is recognised as an asset. This is only the case if it is virtually certain that reimbursement will be received, and the
amount of the receivable can be measured reliably.
1.15 Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be
recognised as part of the cost of inventories or non-current assets. The cost of any unused holiday entitlement is recognised in
the year in which the employee’s services are received.
1.16 Retirement benefits
The Group operates a defined contribution pension plan, under which the Group pays contributions to privately administered
pension plans on a mandatory, contractual or voluntary basis. The Group has no further payment obligations once the
contributions have been paid. The contributions are recognised as employee benefit expense when they are due. Prepaid
contributions are recognised as an asset to the extent that a cash refund or a reduction in the future payments is available.
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87
1. Accounting policies continued
1.17 Share-based payments
Equity-settled share-based payments are measured at fair value at the date of grant by reference to the fair value of the equity
instruments granted using appropriate pricing models. The fair value determined at the grant date is expensed on a straight line
basis over the vesting year, based on the estimate of shares that will eventually vest. A corresponding adjustment is made to equity.
The Group’s schemes award shares in the parent entity and include recipients who are employees in certain subsidiaries. In the
consolidated financial statements, the transaction is treated as an equity-settled share-based payment, as the Group has
received services in consideration for the Group’s equity instruments. An expense is recognised in the Group income statement
for the grant date fair value of the share-based payment over the vesting year, with a credit recognised in equity.
In the subsidiaries’ financial statements, the awards, in proportion to the recipients who are employees in said subsidiary, are
treated as an equity-settled share-based payment, as the subsidiaries do not have an obligation to settle the award. An
expense for the grant date fair value of the award is recognised over the vesting year, with a credit recognised in equity. The
credit to equity is treated as a capital contribution, as the parent company is compensating the subsidiaries’ employees with no
cost to the subsidiaries as there is no expectation to recharge this cost. In the parent company’s financial statements, there is
no share-based payment charge where the recipients are employed by a subsidiary, with the parent company recognising an
increase in the investment in the subsidiaries as a capital contribution from the parent and a credit to equity.
1.18 Foreign currency
Transactions in foreign currencies are translated at the exchange rate at the date of transaction. Monetary assets and liabilities
in foreign currencies are translated at exchange rates at the statement of financial position date. Any gain or loss arising from a
change in the exchange rates after the date of the transaction is included as a gain or loss in other comprehensive income.
Exchange differences arising on a monetary item that forms part of a Group entity’s net investment in a foreign operation are
recognised in profit or loss, of the Group entity carrying the foreign exchange risk. In the financial statements that include the
foreign operation and the reporting entity (e.g., the Group’s consolidated financial statements) and where the monetary item is
deemed as permanent as equity, such exchange differences shall be recognised in other comprehensive income and
reclassified from equity to profit or loss on disposal of the net investment.
The statements of financial position of the foreign subsidiaries are translated into Sterling at the rate at the year-end rate. The
results of the foreign subsidiaries are translated into Sterling at the average rate of exchange during the financial year. Exchange
differences which arise from the translation of opening net assets of the foreign subsidiary undertakings are included in the
consolidated statement of comprehensive income.
1.19 Descriptions of nature of each component of equity
The components of the Group’s equity can be described as follows:
▪ Share capital – the amount for the nominal value of shares issued.
▪ Share premium – the amount subscribed for share capital in excess of nominal value, after deducting costs of issue.
▪ Foreign exchange reserve – this reserve relates to exchange differences arising on the translation of the balance sheet of
the Group’s foreign operations at the closing rate and the translation of the income statement of those operations at the
average rate.
▪ Merger reserve – under the provisions of Section 612 of the Companies Act 2006, the merger reserve represents the difference
between the consideration paid and the book value of the net assets acquired, as part of a legacy Group reconstruction.
▪ Treasury reserve – the reserve relates to shares held in the Group’s Employee Benefit Trust.
▪ Retained deficit – the retained deficit reserve contains the net gains and losses recognised in the consolidated statement of
comprehensive income.
1.20 Inventories
Inventories, which comprise tickets held for resale, are stated at the lower of cost or net realisable value. Consignment tickets
are not included within stocks held by the Group. Inventories are valued using a first-in first-out (FIFO) method.
1.21 Government grants and assistance
Government grants and assistance are recognised in the related expense line in the profit and loss on a systematic basis over
the period in which the entity recognises the expenses, for which the grant is intended to compensate.
Therefore, the grants in recognition of specific expenses are recognised in the related expense line within the profit or loss in
the same period.
1. Accounting policies continued
1.22 IFRS 16 “Leases”
The Group leases various properties for office space. Rental contracts are typically made for rolling periods of one month to
five years but might have extension options. Lease terms are negotiated on an individual basis and contain a wide range of
different terms and conditions. Leases are recognised as a right-of-use asset and a corresponding liability at the date at which
the leased asset is available for use by the Group. Each lease payment is allocated between the liability and finance cost. The
finance cost is charged to the income statement over the lease period so as to produce a constant periodic rate of interest on
the remaining balance of the liability for each period. The right-of-use asset is depreciated over the shorter of the asset’s useful
life and the lease term on a straight line basis.
The Group has not applied the expedient to not recognise all classes of operating leases with a remaining lease term of less
than twelve months as short-term leases. The policy has been consistently applied to leases of underlying assets in the same
class, whereas the transitional expedient can be applied on a lease-by-lease basis.
Assets and liabilities arising from a lease are initially measured on a present value basis. Lease liabilities include the net present
value of the following lease payments:
▪ fixed payments (including in-substance fixed payments), less any lease incentives receivable;
▪ amounts expected to be payable by the lessee under residual value guarantees; and
▪ payments of penalties for terminating the lease, if the lease term reflects the lessee exercising that option.
The lease payments are discounted using the interest rate implicit in the lease, if that rate can be determined, or the Group’s
incremental borrowing rate. Right-of-use assets are measured at cost comprising the following:
▪ the amount of the initial measurement of lease liability;
▪ any lease payments made at or before the commencement date less any lease incentives received;
▪ any initial direct costs; and
▪ restoration costs.
Payments associated with leases of low-value assets are recognised on a straight line basis as an expense in the income
statement. Low-value assets comprise IT equipment.
1.23 Invoice Financing Facility
The Group recognises an invoice financing facility as a financial liability on the balance sheet. It is initially measured at fair
value, considering the expected future cash flows and transaction costs. Subsequently, it is measured at amortised cost using
the effective interest method. The facility is presented as part of current borrowings in the balance sheet, and interest expense
is recognised in the statement of comprehensive income.
2. Adoption of new and revised standards
There are no new standards that are yet effective and that would be expected to have a material impact on the entity in the
current or future reporting periods.
3. Critical accounting judgements and key sources of estimation uncertainty
IAS 1 requires disclosure of the judgements, apart from those involving estimations, that management has made in the process of
applying the entity’s accounting policies that have the most significant effect on the amounts recognised in the financial statements.
In addition, IAS 1 requires disclosure of information about the assumptions the entity makes about the future, and other major
sources of estimation uncertainty at the end of the reporting period, that have a significant risk of resulting in a material
adjustment to the carrying amounts of assets and liabilities within the next financial year. In respect of those assets and liabilities,
the notes to the financial statements include details of their nature and carrying amount at the end of the reporting period.
In the application of the Group and Company’s accounting policies, the Directors are required to make judgements, estimates
and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The
estimates and associated assumptions are based on historical experience and other factors considered to be relevant. Actual
results may differ from these estimates. The Directors do believe there are four areas within the financial statements which
constitute critical accounting judgements and estimates as follows:
Critical Judgements
Capitalisation of development costs
Development costs are capitalised based on an assessment of whether they meet the criteria specified in IAS 38 for
capitalisation. During each reporting period, an assessment is performed by management to determine the time spent
developing the intangible assets (note 17) as a proportion of total time spent in the year. This represents an area of judgement
and impacts the value of intangible costs capitalised: £7.3m (2022: £6.4m).
Financial statementsFinancial statementsNotes to the Financial Statements continuedTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023 88
89
3. Critical accounting judgements and key sources of estimation uncertainty continued
Critical Estimates
Estimation of time spent on capitalisable activities
The determination of the value of capitalised development costs associated with employee salaries and related expenses is
based on an estimation of the time allocated by employees to activities that fulfil the criteria specified in IAS 38 for
capitalisation. These estimations are carried out considering the specific roles and departments of our employees and are
considered critically important.
In the event of a 10% variation in the time allocated by employees within departments engaged in capitalisable activities, the
cost attributed to intangible assets may experience corresponding fluctuations. Should there be a 10% increase in the estimated
time spent, this would result in a £0.4m increment in the cost of the intangible asset, prompting an adjustment to be made to
profit before tax. Conversely, a 10% decrease in the estimated time would lead to a £0.4m reduction in the cost of the intangible
asset, with a corresponding adjustment reflected in profit before tax.
Estimation of deferred tax assets
The assessment of the probability of future taxable income in which deferred tax assets can be utilised is based on the Group’s
latest budget approved by the Board, adjusted for any non-taxable income or expenses. The asset recognised has also been
adjusted to incorporate limitations imposed by the tax rules in the jurisdictions of the Group’s subsidiaries on the utilisation of
tax losses to offset future taxable income. A reasonable change in business profit before tax of an increase of 10% would result
in a £479k increase in the deferred tax asset recognised. A corresponding decrease in the profit before tax would result in a
£979k decrease in the deferred tax asset recognised.
The Group uses a five-year planning horizon to derive the recoverability of tax losses carried forward. If the forecast horizon were
to increase or decrease by one year this would result in a corresponding increase or decrease in the deferred tax asset of £975k.
Useful economic lives
Capitalised development costs in respect of TenMAID, the Ten Digital Platform, and servicing infrastructure are amortised over
their useful life of five years. The useful life is based on management’s judgement, which reflects the period over which the
asset is expected to generate future economic benefits and is annually reviewed for appropriateness.
Management has performed a sensitivity analysis of the impact of changes in the judgement associated with the useful
economic life of TenMAID, the Ten Digital Platform, and servicing infrastructure. A reduction in the useful economic life of one
year would result in an increase in the amortisation expense for the period of £2.5m (2022: £2.3m), while an increase of the
same amount would reduce the amortisation expense by £2.4m (2022: £2.1m).
Material estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to material accounting estimates are
recognised in the year in which the estimate is revised and future years as appropriate.
4. Segment reporting
The total revenue for the Group has been derived from its principal activity, the provision of concierge services. This has been
disaggregated appropriately into operational segment and geographical location.
The Group has three reportable segments: Europe, Asia-Pacific, the Middle East and Africa (AMEA), and North and South
America (the Americas). During the year, the Group changed the reportable segments to reflect the updated management
structure of each region, and as a result, the comparative period has been re-presented to align to the new reportable
segments. Each segment is a strategic business unit and includes businesses with similar operating characteristics. They are
managed separately in similar time zones to reflect the geographical management structure.
Europe
Americas
AMEA
Net Revenue
Add back: cost of sales on principal transactions
Revenue
Europe
Americas
AMEA
Adjusted EBITDA
Amortisation
Depreciation
Share-based payment expense & national insurance
Exceptional items
Operating profit/(loss)
Foreign exchange (loss)/gain
Other net finance expense
Profit/(loss) before taxation
Taxation credit/(expense)
Profit/(loss) for the year
2023
£’000
25,914
25,834
11,255
63,003
3,653
66,656
9,207
1,943
854
12,004
(5,287)
(2,916)
(908)
(1,098)
1,795
(220)
(651)
924
3,623
4,547
2022
£’000
20,615
16,534
9,663
46,812
1,839
48,651
4,907
(700)
671
4,878
(4,608)
(2,713)
(537)
(769)
(3,749)
157
(258)
(3,850)
(466)
(4,316)
Statutory revenue for the Americas and AMEA segments is the same as the Net Revenue amounts disclosed above. Statutory
revenue for the Europe segment was £29,567k (2022: £22,454k).
The Group’s statutory revenue from external corporate clients is generated from commercial relationships entered into by
various Group companies, which, given the global nature of the Group’s service delivery model, may not reflect the location
where the services are delivered, as reflected in the Net Revenue segmentation noted below.
Financial statementsFinancial statementsNotes to the Financial Statements continuedTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023 90
91
4. Segment reporting continued
The Group’s statutory revenue is disaggregated into the following revenue streams as detailed in the revenue accounting policy
(note 1.5). In addition, the Group disaggregates revenue into services where the Group is considered agent or principal as below:
6. Operating profit/(loss)
Operating profit/(loss) for the year is stated after charging:
Direct concierge service revenue
Offers and benefits revenue
Indirect concierge service revenue
Digital platform fees
Revenue
Corporate revenue
Supplier revenue
Revenue
Supplier revenue (cost of sales on principal member transactions)
Net Revenue
Revenue from services as principal
Revenue from services as agent
2023
£’000
52,257
1,170
11,095
2,134
2022
£’000
38,030
1,129
7,516
1,976
66,656
48,651
2023
£’000
55,561
11,095
2022
£’000
41,116
7,535
66,656
48,651
(3,653)
(1,839)
63,003
46,812
2023
£’000
61,416
5,240
2022
£’000
46,570
2,081
66,656
48,651
Net Revenue is a non-GAAP Company measure that includes the direct cost of sales relating to member transactions managed
by the Group, such as the cost of airline tickets sold under the Group’s ATOL licences. Net Revenue is the measure of the
Group’s income on which segmental performance is measured.
Research and development costs not capitalised
Depreciation of property, plant and equipment
Depreciation of right-of-use asset
Amortisation of intangible assets
Bad debt expense
Government assistance
Exceptional items
7. Auditor’s remuneration
For audit services
Audit of the financial statements of the Company
Audit of the financial statements of the Company's subsidiaries
For other services
Tax services for the Company
Tax services for the Company’s subsidiaries
Other services
8. Employees
The average monthly number of persons (including Directors) employed by the Group during the year was:
Adjusted EBITDA is a non-GAAP Company specific measure excluding interest, taxation, amortisation, depreciation, share-based
payment, and exceptional costs. Adjusted EBITDA is the main measure of performance used by the Board, which is considered
to be the chief operating decision maker. Adjusted EBITDA is the principal operating metric for a segment.
UK
International
The statement of financial position is not analysed between reporting segments. Management and the chief operating decision
maker consider the statement of financial position at Group level.
Three corporate clients (2022: two) generated more than 10% of total revenue each during the year ended 31 August 2023.
The total combined revenue of these corporate clients was £23.9m (2022: £9.5m) and was mainly included in the Europe and
Americas segments.
5. Exceptional items
Restructuring costs
Loss on disposal of subsidiary and restructuring
Provision for overseas tax authority costs
2023
£’000
995
18
85
1,098
2022
£’000
-
519
250
769
The Group recognised an exceptional charge which related to restructuring costs incurred during the year of £995k (2022: £nil).
During the year, the Group recognised a further £18k (2022: £519k) related to the disposal of the Russian subsidiary, Ten Group
(RUS) LLC in 2022. The Group also recognised an additional provision of £85k (2022: £250k) related to overseas taxes and
penalties.
Their aggregate remuneration comprised:
Wages and salaries
Social security costs
Pension costs
Share-based payments (note 29)
2023
£’000
1,114
511
2,405
5,287
103
—
1,098
2022
£’000
542
483
2,230
4,608
336
(210)
769
2023
£’000
2022
£’000
170
36
206
—
20
5
25
141
8
149
—
18
8
26
2023
Number
2022
Number
189
1,055
1,244
2023
£’000
35,499
4,881
1,081
908
196
905
1,101
2022
£’000
29,739
3,281
959
537
42,369
34,516
Financial statementsFinancial statementsNotes to the Financial Statements continuedTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023 92
93
9. Directors’ remuneration
13. Net finance expense
Remuneration for qualifying services
Pension contributions to defined contribution schemes
Share-based payments – gain on the exercise of share options during year
2023
£’000
1,100
14
—
1,114
Full details of Directors’ remuneration are presented in the Remuneration Committee Report on pages 62 to 67.
Remuneration disclosed above includes the following amounts paid to the highest paid Director:
Remuneration for qualifying services
Share-based payments – expense
Share-based payments – gain on the exercise of share options during year
2023
£’000
316
54
—
370
2022
£’000
1,007
12
208
1,227
2022
£’000
308
120
84
512
Losses/(gain) on foreign exchange
Interest on bank overdrafts and loans
IFRS 16 interest charge
Loan interest
Interest income
Total finance expense
14. Income tax expense
Current tax
UK current tax expense
Foreign taxes related to current year
Prior year adjustments in respect of foreign taxes
The number of Directors for whom retirement benefits are accruing under defined contribution schemes amounted to two (2022: two).
Deferred tax
10. Key management personnel
Short-term employee benefits
Termination costs
Post-employment benefits
Share-based payments – gain on the exercise of share options during year
2023
£’000
1,573
142
22
37
1,774
2022
£’000
1,544
—
18
293
1,855
Remuneration of key management personnel
The remuneration of key management personnel, including Directors, is set out above in aggregate for each of the categories
specified in IAS 24 “Related Party Disclosures”. Key management personnel comprise the Directors of the Company, and senior
staff with management responsibilities across the entire Group.
11. Related party transactions
In March 2022 of the prior year, Ten Lifestyle Management Limited borrowed £1.5m from Mrs S Weatherill, wife of the previous
Chairman, Mr B Weatherill. Interest is payable monthly in arrears in cash at 8% per annum until June 2023 and 16% per annum
thereafter during the term of the loan. The loan is repayable in the next twelve months and has been classified as current.
In August 2022 of the prior year, Ten Lifestyle Management Limited raised £1.9m of loan notes, including £275k of loan notes
issued to other members of the previous Chairman’s family, who do not fall under the definition of related parties. Please refer
to note 26 for terms of the loan notes, all of which were issued on the same terms.
Other than the related party transactions described above, there were no further related party transactions in the year to disclose.
12. Controlling party
In the opinion of the Directors, there is no one ultimate controlling party.
Origination and reversal of timing differences
Historical losses recognised
Total tax (credit)/expense
(3,623)
466
The tax expense for the year can be reconciled to the income statement as follows:
Profit/(loss) before taxation
Expected tax charge/(credit) based on a corporation tax rate of 21.5% (2022: 19.0%)*
Effect of expenses not deductible in determining taxable profit
Effect of taxes related to previous years
Origination and reversal of timing differences
Historical losses recognised
Overseas tax rate differences
Taxation (credit)/expense for the year
2023
£’000
924
199
60
(169)
1,009
(5,306)
584
(3,623)
2022
£’000
(3,850)
(732)
3
—
975
—
220
466
* A blended rate of 21.5% has been used in the current period following the change in the corporation tax rate from 19% to 25% on 1 of April 2023.
15. Earnings per share
Basic earnings per share
Profit/(loss) attributable to equity shareholders of the parent
Weighted average number of ordinary shares in issue (net of treasury)
Basic profit/(loss) per share (pence)
2023
£’000
2022
£’000
4,547
(4,316)
83,894,193
83,699,615
5.4p
(5.2)p
2023
£’000
2022
£’000
220
62
216
380
(7)
871
(157)
1
185
73
(1)
101
2023
£’000
2022
£’000
—
843
(169)
1,009
(5,306)
—
466
—
—
—
Financial statementsFinancial statementsNotes to the Financial Statements continuedTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023
94
95
15. Earnings per share continued
Basic profit per ordinary share
Basic profit per ordinary share is calculated by dividing the net result for the year attributable to shareholders by the weighted
number of ordinary shares outstanding during the year (2022: (5.2)p).
16. Deferred tax continued
Diluted earnings per share
Profit/(loss) attributable to equity shareholders of the parent
Weighted average number of ordinary shares in issue (net of treasury)
Diluted profit/loss per share (pence)
2023
£’000
2022
£’000
4,547
(4,316)
86,986,163
83,699,615
5.2p
(5.2)p
Diluted earnings per ordinary share
Diluted earnings per share is calculated as per IAS 33 by adjusting the weighted average number of ordinary shares outstanding
for the dilutive effect of “in the money” share options, which are the only dilutive potential common shares for the Group. The
net profit attributable to ordinary shareholders is divided by the adjusted weighted average number of shares. “Out of the
money” share options are excluded from the calculation as they are non-dilutive. Where the Group has incurred a loss in the
year, the diluted loss per share is the same as the basic loss per share as the loss has an anti-dilutive effect.
Underlying earnings per share
Profit/(loss) attributable to equity shareholders of the parent
Excluding exceptional items & taxes
Exceptional items
Recognition of historical tax losses
2023
£’000
2022
£’000
4,547
(4,316)
1,098
(5,306)
769
—
Intangible
assets
£’000
Capital
allowances
£’000
Opening Balance as at 1 September 2022
—
—
Credited/(charged) to the statement of
comprehensive income
Movement in deferred tax balances
Utilisation of historical losses
Recognition of historical losses
Closing balance as at 31 August 2023
(1,672)
—
—
(1,672)
715
—
—
715
Other
temporary
differences
£’000
—
255
—
—
255
Losses
£’000
—
—
(307)
5,306
4,999
Total
£’000
—
(702)
(307)
5,306
4,297
As at 31 August 2023, the Group has unused tax losses of £61.1m that are available for offset against future taxable profits.
During the year ended 31 August 2023, a deferred tax asset has been recognised in respect of £21.0m of such losses (2022: £nil).
Due to uncertainty as to the level and timing of taxable profits in the future, no deferred tax asset has been recognised in
respect of the remaining £40.1m (2022: £31.6m). The losses that remain unrecognised are not expected to expire. Further
information about the recoverability of the recognised deferred tax asset is contained in the “Critical Accounting Estimates and
Judgments” section of these notes.
17. Intangible assets
Website
£’000
Trademarks
£’000
Total
£’000
Underlying profit/(loss) attributable to equity shareholders of the parent
339
(3,547)
Basic weighted average number of ordinary shares in issue (net of treasury)
83,894,193
83,699,615
Basic underlying profit/(loss) per share (pence)
0.4p
(4.2)p
Diluted weighted average number of ordinary shares in issue (net of treasury)
86,986,163
83,699,615
Diluted underlying profit/(loss) per share (pence)
0.4p
(4.2)p
Underlying earnings per ordinary share
Underlying earnings per share is calculated by adjusting the profit/(loss) attributable to equity shareholders for exceptional
items (note 5) and associated taxes along with non-underlying tax items such as deferred tax arising from the recognition of
historical losses. No changes are made to the weighted average number of ordinary shares.
16. Deferred tax
Cost
At 31 August 2021
Additions
Impairment
Disposals
Write-off
At 31 August 2022
Additions
Disposal
At 31 August 2023
2023
£’000
2022
£’000
Accumulated amortisation
Opening balance
Credited/(charged) to the statement of comprehensive income:
Share-based payments
Historical losses
Movement in other temporary differences
Closing balance
—
—
4,999
(702)
4,297
—
—
—
—
At 31 August 2021
Charge for the year
Disposal
At 31 August 2022
Charge for the year
Disposal
At 31 August 2023
Carrying amount
At 31 August 2022
At 31 August 2023
Capitalised
development
costs
£’000
35,036
6,452
—
(4)
—
41,484
7,284
—
1,909
—
—
—
—
1,909
—
—
48,768
1,909
23,481
4,608
(2)
28,087
5,287
—
1,909
—
—
1,909
—
—
33,374
1,909
13,397
15,394
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
36,945
6,452
—
(4)
—
43,393
7,284
—
50,677
25,390
4,608
(2)
29,996
5,287
—
35,283
13,397
15,394
Financial statementsFinancial statementsNotes to the Financial Statements continuedTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023
96
97
17. Intangible assets continued
19. Right-of-use assets
All additions are related to internal expenditure. The useful economic lives of the capitalised development platforms and
website are assessed to be five years and three years respectively.
18. Property, plant and equipment
At 1 September 2021
Additions
Terminations
Lease modifications
Depreciation
Translation differences
At 31 August 2022
Additions
Terminations
Lease modifications
Depreciation
Translation differences
At 31 August 2023
Cost
At 31 August 2021
Additions
Disposals
Reclassification
At 31 August 2022
Additions
Disposals
Reclassification
Exchange movements
At 31 August 2023
Accumulated depreciation
At 31 August 2021
Charge for the year
Disposals
Reclassification
At 31 August 2022
Charge for the year
Disposals
Reclassification
Exchange movements
At 31 August 2023
Carrying amount
At 31 August 2022
At 31 August 2023
Leasehold
improvements
£’000
Fixtures
and fittings
£’000
Office
equipment
£’000
83
—
—
—
83
84
(22)
—
(18)
392
14
(2)
(12)
392
11
—
—
(9)
2,725
852
(24)
12
3,565
436
—
—
(174)
Total
£’000
3,200
866
(26)
—
4,040
531
(22)
—
(201)
127
394
3,827
4,348
43
28
—
—
71
21
(20)
—
(17)
55
12
72
295
49
(1)
(6)
337
45
—
—
(5)
2,301
406
(20)
6
2,693
445
—
—
(134)
2,639
483
(21)
—
3,101
511
(20)
—
(156)
377
3,004
3,436
55
17
872
823
939
912
Land and
buildings
£’000
2,601
1,844
(27)
4
(2,230)
82
2,274
1,573
(88)
605
(2,405)
(48)
1,911
Lease modifications relate to renegotiations on leases, agreed part way through the original lease term. Additions reflect the
renegotiated position and further new office leases.
Financial statementsFinancial statementsNotes to the Financial Statements continuedTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023 98
99
20. Subsidiaries
Details of the Company’s subsidiaries at 31 August 2023 are as follows:
Name of undertaking
Ten Lifestyle Management Limited1
Ten Lifestyle Management (Asia) Limited
Ten Lifestyle Management USA Inc.
Ten Lifestyle Management (Canada) ULC
Ten Group Singapore PTE Limited
Ten Group Japan K.K.
Ten Lifestyle Commercial Consulting (China)
Ten Lifestyle Management Limited S DE RL DE CV
Country of
incorporation
UK
Hong Kong
USA
Canada
Singapore
Japan
China
Mexico
Ten Lifestyle Management Africa (Pty) Limited
South Africa
Ten Lifestyle Management India Private Limited
Ten Servicos de Concierge do Brasil Limited
Ten Group Belgium BVBA
Ten Group Australia Pty Limited
India
Brazil
Belgium
Australia
Ten Lifestyle Management Switzerland GmbH
Switzerland
Ten Group France SAS
Ten Group Norway AS
Ten Latin America Limited
Ten South America Limited
Ten Global Services Limited
Ten Travel Limited
Ten Professional Services Limited
Bailey Medical Support Limited
1 Shares held directly by Ten Lifestyle Group Plc.
France
Norway
UK
UK
UK
UK
UK
UK
Ownership
interest
%
Voting
power held
%
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
Nature of business
Concierge services
Concierge services
Concierge services
Concierge services
Concierge services
Concierge services
Concierge services
Concierge services
Concierge services
Technology and development
Concierge services
Concierge services
Concierge services
Concierge services
Concierge services
Concierge services
Dormant
Dormant
Dormant
Dormant
Dormant
Dormant
20. Subsidiaries continued
The registered offices of the Company’s subsidiaries are as follows:
Name of undertaking
Registered office
Ten Lifestyle Management Limited
2nd floor, Fitzroy House, 355 Euston Road, London, NW1 3AL, United Kingdom
Ten Lifestyle Management (Asia) Limited
Unit 20-125 WeWork, City, Plaza Phase 3, Taikoo, Hong Kong,
Ten Lifestyle Management USA Inc
149 New Montgomery Street, 3rd Floor, San Francisco, CA 94105, USA
Ten Lifestyle Management (Canada) ULC
1200 Bay Street, Suite 202, Toronto, Ontario M5R 2A5, Canada
Ten Group Singapore PTE Limited
36 Robinson Road City House #02-127, Singapore 068877
Ten Group Japan K.K.
Ten Lifestyle Commercial Consulting (China)
Ten Lifestyle Management S DE RL DE CV
7F Sumitomo Sasazuka Taiyo Building, 1-48-3 Sasazuka, Shibuya ku,
Tokyo 151-0073, Japan
Floor 12, Platinum Building, 233 Tai Cang Road, Huangpu District, Shanghai,
200020, China
Torre Concreta Calz. Gral. Mariano Escobedo 526 Piso 8 Oficina 0811
Anzures, Miguel Hidalgo, Ciudad de México 11590
Ten Lifestyle Management Africa (Pty) Limited
7th Floor, 19 Louis Gradner Street, Foreshore, Cape Town 8001, South Africa
Ten Servicos de Concierge do Brasil Limited
Rua Olimpiadas 205 – 4º andar – São Paulo SP 04551-000, Brazil
Ten Group Belgium BVBA
Brussels Airport Corporate Village, Leonardo Da Vin-cilaan, 91935 Zaventem,
Belgium
Ten Group Norway AS
c/o Flattum Accounting, St Olavs Gate, 25 0166, Oslo, Norway
Ten Lifestyle Management Switzerland GmbH
Red Tower, Floor F0 Limmatstrasse 250, 8005, Zurich, Switzerland
Ten Lifestyle Management India Private Limited 9SE, 9th Floor, The Ruby Tower, 29, Senapati Bapat Marg Dadar (West),
Mumbai 400 028, India
Ten Group Australia Pty Limited
Level 11, 80 Mount Street, North Sydney, NSW 2060
Ten Group France SAS
66 avenue des Champs-Élysées, 75008, Paris, France
Ten Lifestyle Argentina (Branch)
Corrientes 222, Piso 10 C1043 AAP, Buenos Aires, Argentina
Ten Lifestyle Management Ltd (DMCC) (Branch) Reef Tower Units 31-07 & 31-08, PO Box 115738, Dubai, UAE
The registered office of the dormant subsidiaries incorporated in the UK is 2nd Floor, Fitzroy House, 355 Euston Road, London
NW1 3AL, United Kingdom.
21. Trade and other receivables
Trade receivables disclosed below are measured at fair value using the expected credit loss model.
Trade receivables
Provision for bad and doubtful debts
Other receivables
Prepayments and accrued income
Movements in Group contract assets and liabilities were as follows:
Accrued income increased
2023
£’000
5,982
(439)
5,543
1,579
4,486
11,608
2023
£’000
264
2022
£’000
4,665
(336)
4,329
1,300
4,301
9,930
2022
£’000
851
All accrued income recognised at 31 August 2022 was released during the year.
The fair value of trade and other receivables shown below, is the same as the carrying value as credit risk has been addressed
as part of impairment provisioning and, due to the short-term nature of the amounts receivable, they are not subject to other
ongoing fluctuations in market rates.
Financial statementsFinancial statementsNotes to the Financial Statements continuedTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023 100
101
22. Trade receivables – credit risk
Ageing of due and past due but not impaired debts
0–30 days
30–60 days
60–90 days
90–120 days
120+ days
Provision for bad and doubtful debts
2023
£’000
4,873
343
111
181
474
5,982
(439)
5,543
2022
£’000
379
34
21
45
275
4,665
(336)
4,329
24. Trade and other payables
Trade payables
Accruals and deferred income
Social security and other taxation
Other payables
Deferred income increase
2023
£’000
1,550
14,845
2,950
714
2022
£’000
1,816
10,801
3,226
616
20,059
16,459
2023
£’000
1,200
2022
£’000
1,137
The Group provides against trade receivables using the expected credit loss model as at the reporting date.
0–30 days
30–60 days
60–90 days
90–120 days
120+ days
Trade
debtors
£’000
Expected credit
loss provision
£’000
Expected credit
loss provision
%
4,873
343
111
181
474
5,982
44
37
23
36
299
439
1%
11%
20%
20%
63%
The provision is based on prior experience using a provision matrix whilst considering an assessment of the current and future
expected economic climate, in addition to taking into account the length of time that the receivable has been overdue.
Movement in the allowances for doubtful debts
Opening balance
Movement in provision
Closing balance
23. Cash and cash equivalents
Cash at banks and on-hand – unrestricted
Cash at banks and on-hand – restricted
Cash in transit
Cash and cash equivalents
2023
£’000
336
103
439
2023
£’000
6,982
1,100
147
8,229
2022
£’000
221
115
336
2022
£’000
5,492
521
571
6,584
Cash at bank earns interest at floating rates based on daily bank deposit rates.
The Group holds cash in a restricted access account in respect of guarantees and reserves. These guarantees arise in the
ordinary course of business and relate to the Group’s travel operations, while the reserves relate to restricted cash related to
the Group’s card intermediary. The guarantees are required under consumer protection schemes in certain markets and are
provided by banks, which hold restricted cash to support the guarantee. As such, this guarantee will be required for the long
term, unless local regulations are amended. In excess of cash held in restricted accounts, the Group has guarantees in place
with local travel authorities of £196k (2022: £193k).
All deferred income recognised at 31 August 2022 was released during the year. The fair values of trade and other payables are
the same as the carrying values.
25. Provision – overseas tax liabilities
Provision for overseas liabilities
Movements on provisions:
At beginning of year
Movement in provision
At end of year
2023
£’000
931
846
85
931
The liabilities relate to overseas tax liabilities. The liabilities will reduce as overseas tax filings are finalised and paid.
26. Borrowings
Current
Non-current
2023
£’000
1,622
2,950
4,572
2022
£’000
846
568
278
846
2022
£’000
1,500
1,940
3,440
Ten Lifestyle Management Limited has entered into additional loan notes of £1.2m (2022: £1.9m) during the year. Interest is
payable quarterly in arrears in cash at 8% per annum during the term of the loan notes, a 1% administration fee payable in cash
at drawdown. The additional loan notes of £1.2m are repayable on the 25 August 2025. The loan notes have been recognised
using the effective interest rate method, for which the average rate is 8.3% (2022: 8.3%).The loans are guaranteed by Ten
Lifestyle Group Plc.
In March 2022 of the prior year, Ten Lifestyle Management Limited borrowed £1.5m from Mrs S Weatherill, wife of the previous
Chairman, as disclosed in note 11.
On 25 January 2023 the Group entered an invoice financing facility available up to a maximum of £2.1m, of which £0.1m was
used at the end of the period. The Group has invoice financing facilities in place relating to trade receivables due from large
corporate clients of Ten Lifestyle Management Limited that are denominated in US Dollars and Sterling. The trade receivables
guaranteed under the arrangement totalled £122k (2022: £nil). The Group retains the credit risk associated to these trade
receivables and therefore presents these trade receivables gross within the reported current assets. The liability arising from
the invoice financing is presented as borrowings within current liabilities. The invoice financing facility is guaranteed to the value
of the debts advanced and accrues interest at a rate of 2% over the base rate.
Financial statementsFinancial statementsNotes to the Financial Statements continuedTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023 102
103
27. Lease liabilities
Lease liabilities
In one year or less
Between one and five years
Total undiscounted lease liabilities
Lease liabilities included in the statement of financial position
Current
Non-current
Lease liability payments allocation
Lease liability repayments
Interest expense on lease liabilities
At 31 August 2022
Additions
Payments
Interest
Terminations
Lease modifications
Translation differences
At 31 August 2023
Carrying amount
At 31 August 2022
At 31 August 2023
2023
£’000
1,967
571
2,538
1,738
399
2,137
2,538
216
2022
£’000
2,118
1,138
3,256
1,834
820
2,654
2,427
185
Land and
buildings
£’000
2,654
1,573
(2,754)
216
(164)
665
(53)
2,137
2,654
2,137
Discount rate
The discount rate used is based on the Group’s estimated cost of debt. The average discount rate applied is 10.41% (2022: 7.7%),
which is the Group’s incremental borrowing rate.
29. Share options
The Company Share Option Plan (CSOP) remains in place and the Management Incentive Plan (MIP) commenced on 9 November
2017. As part of the Group’s COVID-19 cost-saving measures, a Salary Sacrifice Scheme (SSS) was first launched in March 2020,
allowing employees to sacrifice a proportion of their salary over a four-month period in return for share options.
For CSOP and MIP schemes, the holder must be in continued employment of the Company for three years for the option to
vest. All options unexercised after a period of ten years from the date of grant expire.
For the SSS, the holder must sacrifice the pre-agreed amount of salary to vest the options granted. All options unexercised
after a period of three years from the date of grant expire. An extension was granted on certain salary sacrifices noted in the
tables below.
The Group has no legal or constructive obligation to repurchase or settle options in cash.
Options are exercisable at a range of between £0.001 per share and £1.60 per share. The weighted average remaining
contractual life of the share options outstanding at 31 August 2023 is 3.6 years.
The total expense recognised for the year ended 31 August 2023 arising from equity-settled share-based payment transactions
amounted to £0.9m (2022: £0.5m).
Number of options outstanding at 31 August 2021
Granted in the–year - CSOP
Granted in the–year - MIP
Exercised in the–year - SSS
Forfeited in the–year - CSOP
Exercised in the–year - CSOP
Exercised in the–year - MIP
Number of options outstanding at 31 August 2022
Granted in the–year - CSOP
Exercised in the–year - CSOP
Lapsed in the–year - CSOP
Exercised in the–year - MIP
Lapsed in the–year - MIP
Exercised in the–year - SSS
Extensions in the–year - SSS
Lapsed in the–year - SSS
Exercised in the–year - EMI
Lapsed in the–year - EMI
Weighted average
exercise price
£
Number
14,310,323
0.740
678,284
676,000
(1,665,326)
(143,417)
(182,840)
(16,000)
13,657,024
984,362
(105,722)
(262,111)
(80,000)
(609,990)
(319,722)
55,399
(411,261)
(91,528)
(53,336)
0.790
0.001
0.701
0.940
0.740
0.001
0.710
0.489
0.739
0.801
0.001
0.001
0.700
0.690
0.711
0.389
0.224
28. Share capital
Number of options outstanding at 31 August 2023
12,763,115
0.734
84,738,773 (2022: 83,741,801) ordinary shares of £0.001 each
2023
£’000
84,739
84,739
2022
£’000
83,742
83,742
There were 997k shares issued during the financial year ended 31 August 2023. All shares are fully paid.
Own shares held
An Employee Benefit Trust (the “Ten Group Employee Benefit Trust”) was established in February 2012. The Trust holds 42,186
shares (2022: 42,186). These shares held are treated as treasury shares and are included in the treasury reserve in the
consolidated statement of financial position.
Financial statementsFinancial statementsNotes to the Financial Statements continuedTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023
104
105
29. Share options continued
EMI
January 2013 to January 2023
January 2013 to January 2023
January 2013 to January 2023
May 2014 to January 2023
December 2015 to December 2025
MIP
December 2017 to December 2027
April 2018 to April 2028
September 2018 to September 2028
November 2018 to November 2028
June 2019 to June 2029
December 2019 to December 2029
December 2020 to December 2030
August 2022 to August 2032
CSOP
August 2017 to August 2027
March 2018 to March 2028
May 2018 to May 2028
August 2018 to August 2028
September 2018 to September 2028
December 2018 to December 2028
January 2019 to January 2029
April 2019 to April 2029
June 2019 to June 2029
July 2019 to July 2029
August 2019 to August 2029
September 2019 to September 2029
October 2019 to October 2029
August 2020 to August 2030
As at
31 August 2023
As at
31 August 2022
Exercise
price
£
Remaining
contractual
life
AR23
—
—
—
—
34,968
124,000
68,966
112,360
344,828
426,000
96,000
655,000
676,000
81,336
24,672
9,440
29,416
34,968
124,000
68,956
112,360
344,828
490,000
722,000
655,000
676,000
440,000
600,000
9,375
22,222
—
34,483
33,857
67,781
45,802
134,832
25,424
289,915
18,987
12,295
18,987
9,375
22,222
17,241
34,483
42,857
67,781
45,802
134,831
25,424
289,916
18,987
12,295
18,987
0.224
0.536
0.414
0.414
0.563
0.001
0.001
0.001
0.001
0.001
0.001
0.001
0.001
0.750
1.600
1.350
0.870
0.870
0.350
0.440
0.660
0.890
1.180
1.190
0.790
1.220
0.790
0.770
1.070
1.045
1.060
1.000
0.620
0.480
0.700
1.200
1.000
1.100
—
—
—
—
2.29
4.29
4.63
5.05
5.21
5.79
6.30
7.30
8.96
3.96
4.54
4.71
4.96
5.05
5.30
5.38
5.63
5.79
5.88
5.96
6.05
6.13
6.96
7.05
7.54
7.79
7.96
8.30
8.71
9.13
0.46
0.13
0.21
0.54
September 2020 to September 2030
1,168,840
1,305,194
March 2021 to March 2031
June 2021 to June 2031
August 2021 to August 2031
December 2021 to December 2031
May 2022 to May 2032
October 2022 to October 2032
SSS
March 2020 to March 2024
July 2020 to July 2024
November 2020 to November 2024
March 2021 to March 2025
14,018
15,600
14,218
482,403
121,363
968,750
14,018
—
14,218
527,628
121,363
—
1,184,677
1,847,099
1,241,679
1,242,108
2,088,573
2,090,473
1,770,912
1,781,745
12,763,115
13,657,024
29. Share options continued
The periods noted in the table below reflect the month during which the options were awarded to the month of expiration. For
the share options granted during the year, the weighted average fair value of the options is £1.22.
Management Incentive Plan
There were no new options granted under the MIP. All share options granted under the MIP can be exercised at nominal ordinary
share value (£0.001p).
Salary Sacrifice Scheme
Under the SSS, the Group offered its employees the opportunity to sacrifice salary over two four-month periods in exchange for
share options; there were no options granted in this financial year. The sacrifices ranged from 5% to 50% of salary over the grants.
Company Share Option Plan
Under the CSOP, 984,632 (2022: 678,284) options were issued to eligible employees in the 2023 financial year. These shares
were issued under a conditional three years of employment (non-market) from date of grant.
Valuation of share options
The fair value of options subject to non-market-based vesting conditions was measured using a Black Scholes model and those
options with market-based conditions using a Monte Carlo simulation model.
The fair value of the outstanding options without performance conditions was measured using the Black Scholes option
valuation model. The inputs to that model in respect of the share options outstanding under each issue as at 31 August 2023
and 31 August 2022 were as follows:
2022
Grant month
Weighted average share price
Weighted average exercise price
Expected volatility
Weighted average risk free rate
Expected dividend yield
Weighted average option life (years)
Weighted average fair value at date of grant
2023
Grant month
Weighted average share price
Weighted average exercise price
Expected volatility
Weighted average risk-free rate
Expected dividend yield
Weighted average option life (years)
Weighted average fair value at date of grant
CSOP
CSOP
MIP
MIP
Dec 2021
May 2022
Aug 2022
Aug 2022
£0.62
£0.62
52%
1.48%
—
5.0
£0.29
£0.56
£1.10
52%
2.04%
—
2.5
£0.58
£0.58
£0.001
45%
2.04%
—
2.5
£0.08
£0.99
£0.99
48%
0.1%
—
5.0
£0.43
CSOP
Oct 2022
£0.48
£0.48
54%
3.64%
—
5.0
£0.46
The expected share price volatility fluctuated for the different share option schemes due to different years that apply to each
of the schemes in existence. The risk-free rate is based on the average Bank of England base rate in the year.
Expected share price volatility is based on similar listed entities and varies due to the different years that apply to each of the
schemes in existence. For the SSS, expected share price volatility is based on the Group’s share price volatility.
Financial statementsFinancial statementsNotes to the Financial Statements continuedTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023 106
107
30. Capital commitments
At 31 August 2023 the Group had no material capital commitments (2022: £nil).
31. Financial instruments and financial risk management
Financial instruments
The Group’s principal financial liabilities comprise trade and other payables and borrowings. The primary purpose of these financial
liabilities is to finance the operations. The Group has trade and other receivables and cash that derive directly from its operations.
Financial assets
Cash at banks and on–hand - unrestricted
Cash at banks and on–hand - restricted
Trade and other receivables
Financial liabilities
Trade and other payables
Lease liabilities
Borrowings
31. Financial instruments and financial risk management continued
Foreign currency sensitivity analysis
The following table details the Group’s sensitivity to a 5% decrease in £GBP against the relevant foreign currencies which the
Directors believe could have the most significant impact on the performance of the Group. 5% is the sensitivity rate used when
reporting foreign currency risk internally to key management personnel and represents management’s assessment of the
reasonably possible change in foreign exchange rates.
For a 5% strengthening of Great British Pounds against the relevant currency there would be a comparable impact on the profit
and other equity in the opposite direction.
2023
£’000
7,129
1,100
9,253
2023
£’000
2,410
2,137
4,572
2022
£’000
6,063
521
7,949
2022
£’000
2,432
2,654
3,440
Euro
US Dollar
Swiss Franc
Japanese Yen
Brazilian Real
Australian Dollar
Other
Profit or loss
2023
£’000
142
(396)
(119)
(28)
14
(55)
(321)
(763)
2022
£’000
26
(310)
(45)
(46)
-
(52)
(83)
(510)
The Directors consider that the carrying amount for all financial assets and liabilities approximates to their fair value.
Financial risk management
The Company is exposed to market risk, which includes interest rate risk and currency risk, credit risk, and liquidity risk. The
senior management oversees the management of these risks and ensures that the financial risk taken is governed by
appropriate policies and procedures and that financial risks are identified, measured, and managed in accordance with the
Group’s policies and risk appetite.
The Board of Directors reviews and agrees the policies for managing each of these risks, which are summarised below:
Market risk
The Group’s activities expose it primarily to the financial risks of changes in foreign currency exchange rates and interest rates.
Foreign currency risk management
The Group is exposed to transactional and translation exchange risk. Transactional foreign exchange risk arises from sales or
purchases by a Group company in a currency other than that company’s functional currency. Translation foreign exchange risk
arises on the translation of profits earned in Euros, US Dollars, Swiss Francs, Brazilian Real, Australian Dollar, and Japanese Yen
to Sterling and the translation of net assets denominated in Euros, US Dollars, Swiss Francs, Brazilian Real, Australian Dollar,
and Japanese Yen to Sterling, the Group’s functional currency.
Each of the companies in the Group trades almost exclusively in its functional currency, minimising transactional foreign
exchange risk.
GBP:EUR 1
GBP:USD 1
GBP:CHF 1
GBP:JPY 1
GBP:BRL 1
GBP:AUD 1
Year ended 31 August 2022
Average rate
Year-end spot rate
Year ended 31 August 2023
Average rate
Year-end spot rate
1.18
1.16
1.15
1.17
1.30
1.17
1.22
1.27
1.22
1.14
1.12
1.12
158.09
161.82
168.55
185.62
6.82
5.99
6.20
6.22
1.81
1.70
1.82
1.96
Interest rate risk
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in
market interest rates. The Group accepts the risk of losing interest on deposits due to interest rate reductions. Any interest
charged on outstanding loans are at fixed rates.
The Directors do not believe the interest rate risk to be material and therefore no sensitivity analysis has been prepared.
Credit risk
Credit risk is the risk that a counterparty will not meet its obligations under a financial instrument or customer contract, leading
to a financial loss. The Group is exposed to credit risk from its operating activities (primarily for trade receivables) and from its
financing activities, including cash deposits with banks and financial institutions.
Trade receivables
Customer credit risk is managed subject to the Group’s established policy, procedures, and control relating to customer credit
risk management. Outstanding receivables are regularly monitored and discussed at executive management and Board level.
The requirement for impairment is analysed at each reporting date. The calculation is based on actual incurred historical data.
The maximum exposure to credit risk at the reporting date is the carrying value of each class of financial assets disclosed
above. The Company does not hold collateral as security. The Group evaluates the concentration of risk with respect to trade
receivables as low as receivables are principally with large financial institutions.
Financial instruments and cash deposits
Credit risk from cash balances with banks and financial institutions is managed in accordance with the Company’s policy. Credit
risk with respect to cash is managed by carefully selecting the institutions with which cash is deposited.
Liquidity risk
The Group raised funds as part of the IPO in November 2017. In addition, the funds generated by operating activities are
managed to fund short-term working capital requirements. The Board carefully monitors the levels of cash and is comfortable
that it has sufficient cash for normal operating requirements. The Group currently holds no committed lines of credit.
Financial statementsFinancial statementsNotes to the Financial Statements continuedTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023TEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023 108
Company Statement of Financial Position
as at 31 August 2023
109
Company No: 08259177
31. Financial instruments and financial risk management continued
Liquidity risk continued
The following table details the Group’s remaining contractual maturity for its financial liabilities based on undiscounted
contractual payments:
At 31 August 2022
Trade and other payables
Long-term loan
Lease liabilities
At 31 August 2023
Trade and other payables
Long-term loan
Lease liabilities
Within 1 year
£’000
1 to 2 years
£’000
2 to 5 years
£’000
2,432
1,500
1,834
2,410
1,622
1,738
—
—
820
—
2,950
399
—
1,940
—
—
—
—
Total
£’000
2,432
3,440
2,654
2,410
4,572
2,137
Capital risk management
The Group manages its capital to ensure that it will be able to continue as a going concern while also maximising the operating
potential of the business. The capital structure of the Group consists of cash and cash equivalents, long-term loan and equity
attributable to equity holders of the Company, comprising issued capital, reserves, and retained earnings as disclosed in the
consolidated statement of changes in equity. The Group is not subject to externally imposed capital requirements.
Financial instruments carried at fair value
Financial instruments carried at fair value are measured by reference to the following fair value hierarchy prescribed by IFRS 13:
▪ Level 1: quoted prices in active markets for identical assets or liabilities;
▪ Level 2: inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (i.e.
as prices) or indirectly (i.e. derived from prices); and
▪ Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).
Derivative financial instruments are carried at fair value and measured under the level 3 valuation method.
32. Events after the balance sheet date
Since the end of the year, the Group has announced the following material contract expansions and new business wins:
▪ An existing financial services client in the Americas has upscaled their contract with Ten following high member engagement
rates and utilisation. This expansion, which will now increase from a Medium to a Large contract, is expected to begin
generating additional revenue from March 2024.
▪ Ten has entered into a contract with a new global Private Bank client with customers across AMEA for our digitally‐enabled
travel and lifestyle service. This service is expected to be launched across multiple markets in the region during the first half
of the calendar year 2024. Once fully launched, this client is anticipated to equate to a Medium contract.
In addition, the Group has
▪ Raised a further £950k of three-year loan notes, including £250k of loan notes issued to Nitro Ventures Limited on 21
November 2023. Jules Pancholi, Non-Executive Chairman is a shareholder and director of Nitro Ventures Limited. Interest is
payable quarterly in arrears in cash at 12% per annum during the term of the loan, a 1% administration fee payable in cash at
drawdown repayable in November 2026.
▪ Extended the related party loan, originally entered into in March 2022, with Mrs S Weatherill, wife of the previous Chairman
Mr B Weatherill, as disclosed in note 11.
Non-current assets
Investments
Total non-current assets
Current assets
Trade and other receivables
Cash and cash equivalents
Amounts due from Group undertakings
Total current assets
Total assets
Current liabilities
Trade and other payables
Amounts due from Group undertakings
Total current liabilities
Net current assets
Net assets
Equity
Called up share capital
Share premium account
Retained earnings
Total equity
Note
2023
£’000
2022
£’000
33
49,500
48,870
49,500
48,870
34
36
34
35
28
10
6
1,600
1,616
3
6
1,203
1,212
51,116
50,082
(159)
—
(159)
(114)
—
(114)
1,457
1,098
50,957
49,968
85
31,272
19,600
84
30,658
19,226
50,957
49,968
The Company has elected to take the exemption under Section 408 of the Companies Act 2006 from presenting the parent
company profit and loss account and related notes. The Company’s net loss after tax for the year was £255,000 (2022:
£300,000 loss).
The financial statements were approved by the Board of Directors and authorised for issue on 21 November 2023 and are signed
on its behalf by:
Alex Cheatle
Director
Alan Donald
Director
Financial statementsTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023Financial statementsNotes to the Financial Statements continuedTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023
110
Company Statement of Changes in Equity
for the year ended 31 August 2023
Company Statement of Cash Flows
for the year ended 31 August 2023
111
Share
capital
£’000
Share
premium
account
£’000
Note
Retained
earnings
£’000
Total
£’000
Balance at 1 September 2021
Loss for the period
Total comprehensive loss for the year
Equity-settled share-based payments charge
29
Issue of new share capital
Balance at 31 August 2022
Loss for the period
Total comprehensive loss for the year
Equity-settled share-based payments charge
29
Issue of new share capital
Balance at 31 August 2023
82
—
—
—
2
84
—
—
1
85
29,356
18,989
48,427
—
—
—
1,302
(300)
(300)
537
—
(300)
(300)
537
1,304
30,658
19,226
49,968
—
—
—
614
(255)
(255)
629
—
(255)
(255)
629
615
31,272
19,600
50,957
Cash flows from operating activities
Loss for the year after tax
Movement in working capital:
Increase in trade and other receivables
Increase / (decrease) in trade and other payables
Net cash generated used in operating activities
Cash flows from financing activities
Proceeds from issue of shares
Net cash generated by financing activities
Net increase/(decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of the period
Cash and cash equivalents at end of the period
2023
£’000
2022
£’000
(255)
(300)
(405)
45
(615)
615
615
—
6
6
(906)
(163)
(1,369)
1,302
1,302
(67)
73
6
Financial statementsTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023Financial statementsTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023
112
Notes to the Company Financial Statements
113
33. Investments
All investments held by the Company are investments in subsidiaries which are held at cost.
Investments in subsidiaries
Cost
At 31 August 2022
Additions
At 31 August 2023
Carrying amount
At 31 August 2022
At 31 August 2023
2023
£’000
2022
£’000
49,500
48,870
48,870
630
48,333
537
49,500
48,870
48,870
49,500
37. Financial instruments and financial risk management
Financial instruments
The Company has limited financial liabilities as its primary purpose is to hold investments in other Group companies.
The Company’s receivables largely relate to its funding of the operations of the Group.
Financial assets
Cash at bank and in hand – unrestricted
Amounts due from Group undertakings
Trade and other receivables
Financial liabilities
Trade and other payables
2023
£’000
6
1,600
10
2023
£’000
160
2022
£’000
6
1,203
3
2022
£’000
114
The addition in the year represents capital contributions of £0.6m made to the Company’s subsidiaries in respect of the share
option expense recognised on share options issued by the Company to employees of the appropriate subsidiaries, which is a
non-cash transaction.
In the opinion of the Directors the value of the investment in the subsidiary undertakings is not less than the amount shown
above. As a result, no impairment has been recorded in the year (2022: £nil).
34. Trade and other receivables
Trade and other receivables
Amounts due from Group companies
35. Trade and other creditors
Accruals
36. Cash and cash equivalents
Cash at banks and on hand – unrestricted
Cash and cash equivalents
Cash and cash equivalents in the statement of cash flows
2023
£’000
10
1,600
1,610
2023
£’000
159
159
2022
£’000
3
1,203
1,206
2022
£’000
114
114
2023
£’000
2022
£’000
6
6
6
6
6
6
Financial statementsTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023Financial statementsTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023 114
Corporate Information
Registered office
Floor 2
355 Euston Road
London
NW1 3AL
Company website
www.tenlifestylegroup.com
Company secretary
Keziah Watt
Advisers
Nominated Adviser and Broker
Singer Capital Markets Advisory LLP
1 Bartholomew Lane
London
EC2N 2AX
Legal Advisers to the Company
Memery Crystal LLP
165 Fleet Street
London
EC4A 2DY
Auditor
BDO LLP
55 Baker Street
London
W1U 7EU
Ten Lifestyle Group Plc’s commitment to environmental issues
is reflected in this Annual Report, which has been printed on
Symbol Freelife Satin, an FSC® certified material.
This document was printed by L&S using its environmental
print technology, which minimises the impact of printing on
the environment, with 99% of dry waste diverted from landfill.
The printer is a CarbonNeutral® company.
Both the printer and the paper mill are registered to ISO 14001.
Financial statementsTEN LIFESTYLE GROUP PLC Annual Report and Accounts 2023 Ten Lifestyle Group Plc
2nd Floor, Fitzroy House
355 Euston Road
London NW1 3AL
United Kingdom
www.tenlifestylegroup.com