TRAFALGAR PROPERTY GROUP PLC
ANNUAL REPORT AND CONSOLIDATED FINANCIAL STATEMENTS
31 MARCH 2021
Company Registration No. 04340125
TABLE OF CONTENTS
Officers and Professional Advisers 3
Chairman's Statement 4
Strategic Report 5 – 7
Directors' Report 8 – 1 1
Independent Auditor's Report 12 – 17
Consolidated Statement of Comprehensive Income 18
Consolidated Statement of Financial Position 19
Consolidated Statement of Changes in Equity 20
Consolidated Statement of Cash Flows 21
Accounting Policies 22– 30
Notes to the Consolidated Financial Statements 31– 41
Company Balance Sheet 42
Company Statement of Changes in Equity 43
Notes to the Company Financial Statements 44– 50
Explanation of Resolutions at the Annual General Meeting 51
Notice of Annual General Meeting 52– 53
OFFICERS AND PROFESSIONAL ADVISERS
DIRECTORS J Dubois
N A C Lott
P A Treadaway
G Thorneycroft
SECRETARY N W Narraway
REGISTERED OFFICE Chequers Barn
Chequers Hill
Bough Beech
Edenbridge
Kent TN8 7PD
REGISTERED NUMBER: 04340125
AUDITOR
NOMINATED ADVISER
REGISTRARS
MHA MacIntyre Hudson
2 London Wall Place
Barbican
London EC2Y 5AU
Spark Advisory Partners Ltd
5 St John’s Lane
London EC1M 4BH
Neville Registrars Ltd
Neville House
Steelpark Road
Halesowen
West Midlands B62 8HD
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Trafalgar Property Group Plc
CHAIRMAN’S STATEMENT
for the year ended 31 March 2021
On behalf of the Board, I present Trafalgar Property Group Plc (the Group), results for the year ended 31 March
2021 which includes six property sales and two site options completed in the year. The overall result was
disappointing, as can be seen in the attached Accounts and Strategic Report, although an improvement on the
previous year’s loss. We are continuing to progress two existing land options that we still hold but Covid-
19 related issues are causing delays in the planning process.
Financials
The year under review saw the Group turnover at £2,285,800 (2020: £1,970,106), with a loss after tax of
£329,194 (2020: Loss £1,022,898), after taking into account exceptional items as detailed in note 19 to the
accounts.
Management have performed a review of the assets and liabilities of the underlying subsidiaries which form the
value of the anticipated profits on ongoing developments.
Due to the uncertainties and timing these planning appeals, it has been agreed by management not to include
any future anticipated profits of developments in their assessment.
The cash on the balance sheet at the end of the year was £246,193 (2020: £27,969) and the Group continues to
have sufficient bank facilities for all planned activities.
In July 2020 we completed a share issue raising £750,000 of cash, before expenses, which provided additional
cash reserves for our planned activities.
Business Environment and Outlook
On 24th November, 2020 Gary Thorneycroft was appointed as a Director of the Group which strengthens the
Board with his particular expertise within the accountancy profession. This retains a good balance of
complementary skills on the Board. We are currently progressing offers of finance alongside our planning
applications so that we should be well placed to commence our developments as soon as planning permits.
The effects of the Covid-19 pandemic have affected our business since March 2020 as sales of completed units
have been delayed by some months with the planning process being negatively impacted by the effects of the
pandemic. Fortunately we had completed the construction phase of these units although there have also been
delays to the obtaining of planning permission for other potential new sites. Like most businesses, we are aware
of our need to conduct ourselves carefully to preserve the health of our staff and customers.
I would refer you to the Strategic Report that covers our activities in more detail.
James Dubois
Chairman
6 September 2021
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Trafalgar Property Group Plc
STRATEGIC REPORT
for the year ended 31 March 2021
titp
Business review, results and dividends
All trading and property assets of Trafalgar Property Group Plc (Group) are held in the name of the Group or its
subsidiaries as follows:
Trafalgar New Homes Limited (TNH)
Trafalgar Retirement+ Limited (TR+)
Selmat Limited (Selmat)
Combe Bank Homes (Oakhurst) Limited (Oakhurst)
Combe Homes (Borough Green) Limited (Borough Green)
All bank borrowings were the liability of TNH, the wholly owned subsidiary of the Group, however during the
year the bank borrowings were cleared. Mortgages of £924,373 exist on the four properties held by Selmat. The
shares of the Group are quoted on the London Stock Exchange AIM market.
The principal activity of the Group continues to be that of home building and property development and the
consolidated results of the year’s trading, are shown below. The consolidated loss for the year was £329,194
(2020: Loss £ 1,022,898) after taking into account exceptional items as mentioned in note 19 to the accounts.
Principal risks & uncertainties
Set out below are certain risk factors which could have an impact on the Group's long-term performance. The
factors discussed below should not be regarded as a complete and comprehensive statement of all potential
risks and uncertainties facing the Group.
The principal risks and uncertainties facing the Group are:
1. Direct costs may escalate and eat into gross profit margins.
2. Heavy overheads may be incurred especially when projects have been completed and before others
have been commenced.
3. The Group could commit too much to future capital projects.
4. The Group’s reliance on key members of staff.
5. The market may deteriorate, damaging liquidity of the Group and future revenues.
The Group considers that it mitigates these risks with the following policies and actions:
1. The Group affords its bankers and other lenders a strong level of asset and income cover and maintains
good relationships with a range of funding sources from which it is able to secure finance on favourable
terms.
2. Direct costs are outsourced on a fixed price contract basis, thereby passing on to the contractor all risk
of cost overspend, including from increased material, labour or other costs.
3. Most other professional services are also outsourced, thus providing a known fixed cost before any
project is taken forward and avoiding the risk that can arise in employing in-house professionals at a
high unproductive overhead at times when activity is slack.
4. Buying decisions for capital projects are taken at Board level, after careful research by the Directors …
personally, who have substantial experience in various business sectors and markets.
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Trafalgar Property Group Plc
STRATEGIC REPORT
for the year ended 31 March 2021
titp
The Group has focused on a niche market sector of new home developments in the range of four to
twenty units. Within this unit size, competition to purchase development sites from land buyers is
relatively weak, as this size is unattractive to major national and regional house builders who
require a larger scale to justify their administration and overheads, whilst being too many units
for the smaller independent builder to finance or undertake as a project. Many competitors who also
focus on this niche have yet to recapitalise and are unable to raise finance.
5. Many of the activities are outsourced and each of the Directors is fully aware of the activities of all
members.
6. The Group has a corporate governance policy appropriate for a small publicly listed company with
ambitions substantially to raise its profile within the wider investor community.
Operations review
A summary of the results for the year is as follows:-
Revenue for the year
Gross profit
Loss after taxation
2021
£
2020
£
2,285,800
322,006
(329,194)
1,970,106
111,970,0
154,068
68
(1,022,898)
Group turnover for the year amounted to £2,285,800 (2019: £1,970,106), representing the sale of six units at
Sheerness plus two land options purchased and sold (2020: two residential properties plus car park space).
After taking into account the overheads of the Group, there was a loss recorded for the year of (£329,194) after
exceptional items as detailed in note 19.
There will be no tax charge and the Company now has tax losses being carried forward of £ 4,645,489 (2020:
losses £4,381,991).
The loss per share during the year was (0.34p), (2020: loss per share 0.21p).
As can be seen from the above , the Group failed to achieve a profit for the year under review and during the year
all remaining residential units have been sold being the remaining six units at the Sheerness Site. There are
currently two site options in Send & Leatherhead upon which planning was not granted and for which now
appeals have been lodged with further option opportunities being explored.
Directors’ duties under S172
The Directors believe that, individually and together, they have acted in the way they consider, in good faith,
would be most likely to promote the success of the Group for the benefit of its members as a whole, having
regard to the stakeholders and matters set out in s172(1)(a-f) of the Companies Act 2006 in the decisions taken
during the year ended 31 March 2021.
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Trafalgar Property Group Plc
STRATEGIC REPORT
for the year ended 31 March 2021
titp
Our Board of Directors remain aware of their responsibilities both within and outside of the Group. Within the
limitations of a Group with so few employees we endeavour to follow these principles:
Purpose, vision and strategy: this is set out on pages 5-7 on this Strategic Report and we recognise our
role in identifying opportunities to develop homes and apartments to the best quality standards.
Group policies: these are reviewed annually and staff and Directors are encouraged to improve their
skillset as appropriate.
Culture and people: we fully support a culture where all customers, staff and suppliers are treated in
an open and honest fashion, irrespective of race, gender, ethnic, disabilities or other scenarios.
Board structure: the role of the Board is reviewed annually with a clear focus on the specific roles
assigned to each individual to enable the Board to properly support each member of staff.
Freedom within a framework: we are developing a new framework for communicating this freedom
in a straight-forward methodology.
Risk and internal control framework: risks and controls are subject to discussion at quarterly Board
meetings. Every project undertaken by the Group is analysed with a view to limiting the risks to the
Group and its Stakeholders before proceeding with implementation.
Key performance indicators (KPIs)
Management are closely involved in the day to day operations of the Group and constantly monitor cashflows
and expenditure. However, Management believe the key indicators of performance for the Group are the
revenue and profitability achieved during the period. These measures are disclosed above in the operations
review.
Development Pipeline & outlook
The year under review was not without its difficulties. In the residential division delays occurred on the building
programme for the various properties that were still in the course of construction, or being finished off, with
contractors appointed to complete the works but unable to follow the timetable laid down for completion of
those works. The delays lead to escalating interest costs on borrowing and therefore affected the profitability of
the completed units that were for sale, on the disposal of the same. During the year all remaining 6 units at the
Sheerness site sold.
Currently the Group holds four rented properties within its subsidiary. These properties valued at £1,975,000 as
investment properties have generated rental income and are let on Assured Shorthold Tenancy Agreements,
generating rental income substantially in excess of the borrowing cost of each property.
Whilst TR+ continue to identify and secure new land opportunities for extra/care and assisted living, they are
equally focused on obtaining a successful outcome on sites currently under option and/or in for planning. Once
planning has been achieved the sites can be built out and placed for sale on the open market, or in the case of the
smaller residential schemes, sold on with planning, both options being profitable to the business. Options have
been secured for residential development in Ashtead, & Epsom and subsequently sold for profit during the year.
Going forward options still remain on Leatherhead and Send but planning has not been forthcoming and this is
now lodged for appeal. It is our intention to develop the Leatherhead and Send sites once the favourable outcome
of the appeal is known.
Financial Instruments
Information relating to the financial instruments is now included in the Directors’ Report on pages 8-11.
Paul Treadaway
Director
6 September 2021
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Trafalgar Property Group Plc
DIRECTORS’ REPORT
for the year ended 31 March 2021
DIRECTORS’ REPORT
The Directors present their Report and Audited Financial Statements for the year ended 31 March 2021.
Results and dividends
The results for the year are set out on page 19.
The Directors do not recommend the payment of a final dividend for the year (2020: nil).
Directors
The following Directors have held office since 1 April 2020 and have all served for the entire accounting year:-
N A C Lott
J Dubois
P A Treadaway
Appointed in year:
G Thorneycroft- 24 November 2020
The Company has in place an insurance policy in relation to Directors indemnity during both years.
Conflicts of interest
Under the articles of association of the company and in accordance with the provisions of the Companies Act
2006, a Director must avoid a situation where he has, or can have, a direct or indirect interest that conflicts, or
possibly may conflict with the company's interests. However, the Directors may authorise conflicts and
potential conflicts, as they deem appropriate. As a safeguard, only Directors who have no interest in the
matter being considered will be able to take the relevant decision, and the Directors will be able to impose
limits or conditions when giving authorisation if they think this is appropriate. During the financial year ended
31 March 2021, the Directors have authorised no such conflicts or potential conflicts.
Directors’ interests in the shares of the Company, including family interests, at 31March 2021 were as follows: -
Directors’ interests in shares
J Dubois
N Lott
D C Stocks
P Treadaway
G Thorneycroft
31.03.2021
31.03.2020
Ordinary shares - 0.1p each Ordinary shares - 0.01p each
400,000
4,000,000
50,000
-
19,733,466
600,000
500,000
80,330,532
106,484,658
-
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Trafalgar Property Group Plc
DIRECTORS’ REPORT
for the year ended 31 March 2021
31.03.2021
Deferred shares – 0.9p each
No. held
31.03.2020
Deferred shares – 0.9p each
No. held
J Dubois
N Lott
D C Stocks
P Treadaway
G Thorneycroft
1,900,000
550,000
-
1,500,000
500,000
-
10,648,466 -
-
-
Shares shown for the year to 31 March 2021 are stated following consolidation of ordinary shares from 0.01p to
0.1p and deferred shares from 0.09p to 0.9p.
On 13 July 2020 each ordinary share of 0.1p was sub-divided into one ordinary share of 0.01p each and one
deferred share of 0.09p each,
On 14 July 2020 937,500,000 ordinary shares of 0.01p were issued at 0.08p per share (including a share premium
of 0.07p per share) under a placing to raise £ 750,000 before costs of £ 66,863. A loan note instrument
was entered into with Mr C C Johnson on 13 July 2020 as part of an arrangement to reorganize loans between
himself and the Group. Warrants to subscribe for up to 937,500,000 ordinary shares of 0.01p were granted to
placees on a one for one basis exercisable for a period of two year from 14 July 2020, and were also granted to
Peterhouse Capital Limited to subscribe for shares equivalent up to 3% of the issued ordinary share capital from
time to time, for a period of two years from 14 July 2020. Finally on 29 December 2020 the ordinary shares of
0.01p each were consolidated into ordinary shares of 0.1p each. Further details on all these items are given in
Note 15 to the accounts.
C C Johnson, A D Johnson were shareholders (but not directors) as at 31 March, 2020 & 31 March, 2021.
Other substantial shareholdings
As at 2 September 2021, being the latest practicable date before the issue of these financial statements, the
company had been notified of the following shareholdings which constitute 3% or more of the total issued shares of
the company at that date.
C.C. Johnson
P Treadaway
R & C Edwards
Statement of directors’ responsibilities
Ordinary
shares
No 0.1p
18,681,580
19,773,466
12,955,720
Shareholding
%
13.11
13.87
9.09
Company law requires the Directors to prepare financial statements for each financial year. Under that law the
Directors have elected to prepare the consolidated financial statements in accordance with International Financial
Reporting Standards (IFRS) and IFRS in conformity with the requirements of Companies Act 2006 and the
Company financial statements in accordance with FRS 102 and applicable law. 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 of the profit or loss of the Group for that year. In preparing these financial
statements, the Directors are required to:
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Trafalgar Property Group Plc
DIRECTORS’ REPORT
for the year ended 31 March 2021
select suitable accounting policies and then apply them consistently;
make judgements and estimates that are reasonable and prudent;
state whether applicable Accounting Standards have been followed, subject to any material departures
disclosed and explained in the financial statements;
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the
Group will continue in business.
The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the
Group’s transactions and disclose with reasonable accuracy at any time the financial position of the Group and
enable them to ensure that the financial statements comply with the Companies Act 2006. They are also
responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention
and detection of fraud and other irregularities.
They are further responsible for ensuring that the Strategic Report and the Report of the Directors and other
information included in the Annual Report and Financial Statements is prepared in accordance with applicable
law in the United Kingdom.
The maintenance and integrity of the Group website is the responsibility of the Directors; the work carried out by
the auditors does not involve the consideration of these matters and, accordingly, the auditors accept no
responsibility or any changes that may have occurred in the accounts since they were initially presented on the
website.
Legislation in the United Kingdom governing the preparation and dissemination of the accounts and the other
information included in annual reports may differ from legislation in other jurisdictions.
Corporate Governance Statement
The Board of the Group recognise the value of good corporate governance and implemented corporate
governance procedures during the previous year and continued to use these during the financial year to 31 March
2021. These procedures are appropriate for the present size of the entity having given due regard to the
Corporate Governance Code for Small and Mid-Size Quoted Companies issued by the Quoted Companies
Alliance (“QCA”). The Company has decided to apply the QCA Corporate Governance Code (“QCA
Code”) issued by the QCA in May 2018 and has published on its website details of the QCA Code, how the
Company has complied with the QCA Code and, where it departs from the QCA Code, an explanation of the
reasons for doing so. The Board has considered the Streamlined Energy and Carbon Reporting requirements and
conclude that the Group has not consumed more than 40,000 kWh of energy and therefore qualifies as a low
energy user and is exempt from reporting under these regulations.
Board Structure
The Board consists of four Directors (2020: three) of which three are executive and one non-executive, all of
whom hold shares in the Group.
The Board meets as and when required and is satisfied that it is provided with information in an appropriate
form and quality to enable it to discharge its duties. All Directors are required to retire by rotation with one
quarter of the Board seeking re-election each year.
Due to the current size of the Group, the duties that would normally be attributed to The Nomination Committee,
have been undertaken by the Board as a whole.
The Board has undertaken a formal assessment of the auditor's independence and will continue to do so at least
annually. This assessment includes:
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Trafalgar Property Group Plc
DIRECTORS’ REPORT
for the year ended 31 March 2021
a review of non-audit services provided to the company and the related fees;
a review of the auditor's own procedures for ensuring the independence of the audit firm and parties
and staff involved in the audit, including regular rotation of the audit partner; and
obtaining confirmation from the auditor that, in their professional judgement, they are independent.
Internal Controls
The Board is responsible for the Group's system of internal controls and for reviewing their effectiveness. The
internal controls are designed to ensure the reliability of financial information for both internal and external
purposes. The Directors are satisfied that the current controls are effective with regard to the size of the Group.
Any internal control system can only provide reasonable, but not absolute assurance against material mis-
statement or loss. Given the size of the Group, the Board has assessed that there is currently no need for an
internal audit function.
Financial Instruments
The Group’s principal financial instruments comprise cash at bank, bank loans, other loans and various items
within current assets and current liabilities that arise directly from its operations. The Directors consider that the
key financial risk is liquidity. This risk is explained in the section headed ‘Principal risks and uncertainties’ in
the Annual Report and Accounts on page 5.
Information relating to the financial instruments is now included in the Strategic Report on pages 5-7.
Future Developments
Information relating to future developments is included in the Strategic Report on pages 5-7.
Provision of information to auditor
Each of the persons who are Directors at the time when this Directors’ Report is approved has confirmed that:
so far as that Director is aware, there is no relevant audit information of which the Group’s auditor is
unaware; and
that Director has taken all the steps that ought to have been taken as a Director in order to be aware of
any information needed by the Group’s auditor in connection with preparing their report and to
establish that the Group’s auditor is aware of the information.
Auditor
The auditor, MHA MacIntyre Hudson, will be proposed for re-appointment in accordance with Section 489 of
the Companies Act 2006.
This report was approved by the Board and signed on its behalf.
Paul Treadaway Director
6 September 2021
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Trafalgar Property Group Plc
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF TRAFALGAR
PROPERTY GROUP PLC
for the year ended 31 March 2021
For the purpose of this report, the terms “we” and “our” denote MHA MacIntyre Hudson in relation to UK
legal, professional and regulatory responsibilities and reporting obligations to the members of Trafalgar
Property Group plc. For the purposes of the table on pages 14 to 15 that sets out the key audit matters and
how our audit addressed the key audit matters, the terms “we” and “our” refer to MHA MacIntyre Hudson.
The Group financial statements, as defined below, consolidate the accounts of Trafalgar Property Group plc
and its subsidiaries (the “Group”). The “Parent Company” is defined as Trafalgar Property Group plc. The
relevant legislation governing the Parent Company is the United Kingdom Companies Act 2006
(“Companies Act 2006”).
Our opinion
We have audited the financial statements of Trafalgar Property Group plc for the year ended 31 March 2021.
The financial statements that we have audited comprise:
• Group Income Statement and Statement of Comprehensive Income.
• Group and Company Statements of Financial Position
• Group and Company Statements of Changes In Equity
• Group Statements of Cash Flows
• Notes 1 to 21 of the consolidated financial statements, including the accounting policies & notes 1 to
14 of the parent company financial statements, including the accounting policies.
The financial reporting framework that has been applied in their preparation is applicable law and
international accounting standards in conformity with the requirements of the Companies Act 2006.
In our opinion, the financial statements:
•
•
•
give a true and fair view of the state of the Group’s and of the parent Company’s affairs as at 31
March 2021 and the Group’s loss for the year then ended.
have been properly prepared in accordance with UK adopted international accounting standards and
international accounting standards in conformity with the requirements of the Companies Act 2006
and
have been prepared in accordance with the requirements of the Companies Act 2006.
Our opinion is consistent with our reporting to the Directors.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and
applicable law. Our responsibilities under those standards are further described in the Auditor’s
Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the
Group in accordance with the ethical requirements that are relevant to our audit of the financial statements
in the UK, including the FRC’s Ethical Standard as applied to listed entities, and we have fulfilled our
ethical responsibilities in accordance with those requirements. We believe that the audit evidence we have
obtained is sufficient and appropriate to provide a basis for our opinion.
Material uncertainty related to going concern
We draw your attention to the going concern section of the accounting policies in the financial statements
which states that the Group incurred substantial losses during the year and the continued requirements for
successful future equity or debt fund raising. The impact of this together with other matters set out in the
note, indicate a material uncertainty exists that may cast significant doubt on the group’s ability to
continue as a going concern. Our opinion is not modified in respect of this matter.
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Trafalgar Property Group Plc
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF TRAFALGAR
PROPERTY GROUP PLC
for the year ended 31 March 2021
Our evaluation of the Directors’ assessment of the Group and Parent Company’s ability to continue to adopt the
going concern basis of accounting included:
• The consideration of inherent risks to the Company’s operations and specifically its business model.
• The evaluation of how those risks might impact on the Company’s available financial resources.
• Where additional resources may be required the reasonableness and practicality of the assumptions
made by the Directors when assessing the probability and likelihood of those resources becoming
available.
• Liquidity considerations including examination of cash flow projections.
• Solvency considerations including examination of budgets and forecasts and their basis of
preparation, including review and assessment of the model’s mechanical accuracy and the
reasonableness of assumptions included within.
• Consideration of availability of funds required to settle funding facilities due for repayment during
the going concern review period. Assessing the reasonableness and practicality of the mitigation
measures identified by management in their conservative case scenario and considered by them in
arriving at their conclusions about the existence of any uncertainties in respect of going concern.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the
relevant sections of this report.
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Trafalgar Property Group Plc
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF TRAFALGAR
PROPERTY GROUP PLC
for the year ended 31 March 2021
Overview of our audit approach
Materiality
2021
2020
Group
Parent
£58,500
£68,000
2% of Gross Assets
£22,000
£7,000
2% of Gross Assets
Key Audit Matters
Group
• Undisclosed Related Party Transactions
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. These matters included those matters
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 and, as required for public interest entities, our results from
those procedures. 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.
Undisclosed Related Party Transactions
Key audit
matter description
The Group enters into a significant number of transactions with related parties, both
intra-group transactions and with individuals related to the Group. There is a risk that
transactions (particularly any transactions which are not at arm’s length) and balances
with related parties are undisclosed.
How the scope of our
audit responded to the
key audit matter
Our procedures included an assessment of the presentation of related party transactions in
the financial statements, this focused primarily on the Directors loan accounts.
We reviewed movements on these balances in the year and vouched items to
supporting evidence.
We discussed with management the nature and purpose of these items and considered
whether disclosure sufficiently addressed these matters.
In addition, we obtained written confirmations of the balances from all disclosed
parties and confirmed key terms to agreements.
Key observations
We concluded that the classification and disclosure of related party transactions is
complete and appropriate.
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Trafalgar Property Group Plc
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF TRAFALGAR
PROPERTY GROUP PLC
for the year ended 31 March 2021
Our application of materiality
Our definition of materiality considers the value of error or omission on the financial statements that,
individually or in aggregate, would change or influence the economic decision of a reasonably knowledgeable
user of those financial statements. 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. Materiality is used in
planning the scope of our work, executing that work and evaluating the results.
Materiality in respect of the Group was set at £58,500 (2020: £68,000) which was determined based on 2% of
gross assets in both years. Gross assets were deemed to be the most appropriate metric for materiality as this is
primarily what the users of the financial statements are concerned with.
Performance materiality is the application of materiality at the individual account or balance level, set at an
amount to reduce to an appropriately low level the probability that the aggregate of uncorrected and undetected
misstatements exceeds materiality for the financial statements as a whole.
Performance materiality for the Group was set at £35,100 (2019: £40,800) which represents 60% (2020: 60%)
of the above materiality levels.
The determination of performance materiality reflects our assessment of the risk of undetected errors existing,
the nature of the systems and controls and the level of misstatements arising in previous audits.
Materiality in respect of the parent was set at £22,000 (2020: £7,000) which was determined based on 2% of
gross assets. Performance materiality for the parent company was set at £13,200 (2020: £4,200) which
represents 60% (2020: 60%) of the above materiality levels.
We agreed to report any corrected or uncorrected adjustments exceeding £2,925 to the directors as well as
differences below this threshold that in our view warranted reporting on qualitative grounds.
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 6 reporting components all of which were considered to be significant components of the
Group, Trafalgar Property Group Plc, Trafalgar New Homes Limited, Trafalgar Retirement + Limited, Combe
Bank Hones (Oakhurst) Limited, Combe Homes (Borough Green) Ltd and Selmat Limited. The significant
components were subjected to full scope audits for the purposes of our audit report on the Group financial
statements.
Reporting on other information
The other information comprises the information included in the annual report other than the financial
statements and our auditor’s report thereon. The directors are responsible for the other information contained
within the annual report. 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.
P a g e | 15
Trafalgar Property Group Plc
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF TRAFALGAR
PROPERTY GROUP PLC
for the year ended 31 March 2021
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
•
•
the information given in the strategic report and the directors’ report for the financial year for which the
financial statements are prepared is consistent with the financial statements; and
the strategic report and the directors’ report have been prepared in accordance with applicable legal
requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the Group and the Parent Company and its environment
obtained in the course of the audit, we have not identified material misstatements in the strategic report or the
directors’ report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006
requires us to report to you if, in our opinion:
•
•
adequate accounting records have not been kept by the Parent Company, or returns adequate for our
audit have not been received by branches not visited by us; or
the financial statements of the Parent Company 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 aggregate, they
could reasonably be expected to influence the economic decisions of users taken on the basis of these financial
statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures
in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities,
including fraud.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including
those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk
increases the more that compliance with a law or regulation is removed from the events and transactions
reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance.
The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves
intentional concealment, forgery, collusion, omission or misrepresentation.
P a g e | 16
Trafalgar Property Group Plc
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF TRAFALGAR
PROPERTY GROUP PLC
for the year ended 31 March 2021
The specific procedures for this engagement and the extent to which these are capable of detecting irregularities,
including fraud is detailed below:
• Obtaining an understanding of the legal and regulatory frameworks that the Group operates in,
focusing on those laws and regulations that had a direct effect on the financial statements. The key laws
and regulations we considered in this context included the UK Companies Act 2006, AIM regulations
and applicable tax legislation. In addition, we considered compliance with the UK Bribery Act and
employee legislation, as fundamental to the Group’s operations.
• Enquiry of management to identify any instances of non-compliance with laws and regulations.
• Enquiry of management around actual and potential litigation and claims.
• Enquiry of management concerning actual and potential litigation and claims.
• Enquiry of management to identify any instances of known or suspected instances of fraud.
• Discussing among the engagement team regarding how and where fraud might occur in the financial
statements and any potential indicators of fraud.
• Reading key correspondence with regulatory authorities such as the Financial Reporting Council.
• Performing audit work over the risk of management override of controls, including testing of journal
entries and other adjustments for appropriateness, evaluating the business rationale of significant
transactions outside the normal course of business, and reviewing accounting estimates for bias; and
• Challenging assumptions and judgements made by management in their significant accounting
estimates, in particular with respect to the valuations of investments and bonds.
A further description of our responsibilities for the financial statements is located on the FRC’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 Company’s members, as a body, in accordance with Chapter 3 of Part 16 of the
Companies Act 2006. Our audit work has been undertaken so that we might state to the Company’s members
those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest
extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the
Company’s members as a body, for our audit work, for this report, or for the opinions we have formed.
Andrew Moyser FCA FCCA
(Senior Statutory Auditor)
for and on behalf of MHA MacIntyre Hudson , London
Statutory Auditor
6 September 2021
P a g e | 17
Trafalgar Property Group Plc
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
for the year ended 31 March 2021
Revenue
Cost of sales
Gross profit
Administrative expenses
Year
ended
Year
ended
31 March
2021
31 March
2020
£
£
Note
1
2,285,800
1,970,106
(1,963,794)
(1,816,038)
322,006
154,068
(463,963)
(541,397)
Operating (loss)
3
(141,957)
(387,329)
(Loss) before interest and exceptional items
Other income
Exceptional items
Interest payable and similar charges
(Loss) before taxation
Tax payable on (loss) on ordinary activities
(Loss) after taxation for the year attributable to equity
holders of the parent
Other comprehensive income attributable to equity
holders of the parent
Total comprehensive (loss) for the year
(Loss) attributable to:
Equity holders of the Parent
Total comprehensive (loss) for the year attributable to:
Equity holders of the Parent
(LOSS) PER ORDINARY SHARE:
Basic/diluted
2
19
5
6
(141,957)
(387,329)
27,023
-
-
(595,452)
(214,260)
(40,117)
(329,194)
(1,022,898)
-
-
(329,194)
(1,022,898)
-
-
(329,194)
(1,022,898)
(329,194)
(1,022,898)
(329,194)
(1,022,898)
7
(0.34)p
(0.21)p
All results in the current and preceding financial year derive from continuing operations.
The notes on pages 22 to 41 are an integral part of these consolidated financial statements
P a g e | 18
Trafalgar Property Group Plc
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
For the year ended 31 March 2021
TOTAL ASSETS
Non-current assets
Plant and equipment
Investment property
Current assets
Inventory
Trade and other receivables
Cash and cash equivalents
Total assets
EQUITIES & LIABILITIES
Current liabilities
Trade and other payables
Borrowings
Non-current liabilities
Deferred tax
Borrowings
Total liabilities
Net (liabilities)/assets
31 March
31 March
Note
2021
£
2020
£
8
9
12
10
11
1,516
1,423
1,975,000 1,975,000
1,976,516 1,976,423
1,212,692
78,608
33,455
42,299
246,193 27,969
1,282,960
358,256
2,334,772
3,259,383
13
14
478,514
-
548,804
555,000
478,514
1,103,804
6
14
-
4,818,488
-
5,575,884
5,297,002
6,679,688
(2,962,230) (3,420,305)
(176,644) (624,592)
2,726,817
3,250,249
(2,817,633)
104,132
(6,225,795)
(2,962,230)
2,633,067
2,660,862
(2,817,633)
-
(5,896,601)
(3,420,305)
2,334,772 3,259,383
Called up share capital
Equity attributable to equity holders of the Company
Share premium account
Reverse acquisition reserve
Loan note equity reserve
Profit & loss account
Total Equity
Total Equity & Liabilities
15
15 & 17
These financial statements were approved by the Board of Directors and authorised for issue on 6 September,
2021 and are signed on its behalf by:
P Treadaway: ………………………………………. G Thorneycroft: …………………………………………
The notes on pages 22 to 41 are an integral part of these consolidated financial statements.
P a g e | 19
Trafalgar Property Group Plc
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
As at 31 March 2021
Share
Share
Loan Note
Reverse
Retained
Total Equity
Capital
Premium
£
£
Equity
Reserve
£
acquisition
profits/
reserve
£
(losses)
£
£
At 1 April 2019
2,570,567
2,510,462
-
(2,817,633)
(4,873,703)
(2,610,307)
Loss for the year
Total comprehensive
Income for the year
Issue of shares
62,500
187,500
Share issue costs
(37,100)
(1,022,898)
(1,022,898)
(1,022,898)
(1,022,898)
,,,,,,,,250,000
(37,100)
At 31 March 2020
2,633,067
2,660,862
-
(2,817,633)
(5,896,601)
(3,420,305)
At 1 April 2020
2,633,067
2,660,862
-
(2,817,633)
(5,896,601)
(3,420,305)
Loss for the year
Total comprehensive
Income for the year
Loan note equity
reserve
Issue of shares
93,750
656,250
Share issue costs
(66,863)
104,132
(329,194)
(329,194)
(329,194)
(329,194)
104,132
750,000
(66,863)
At 31 March 2021
2,726,817
3,250,249
104,132
(2,817,633)
(6,225,795)
(2,962,230)
The reverse acquisition reserve was created in accordance with IFRS3 ‘Business Combinations’. The reserve arises due
to the elimination of the Company’s investment in TNH (formerly Combe Bank Homes Limited). Since the
shareholders of TNH became the majority shareholders of the enlarged group, the acquisition is accounted for as
though there is a continuation of the legal subsidiary’s financial statements. In reverse acquisition accounting,
the business combination’s costs are deemed to have been incurred by the legal subsidiary. Retained
profit/(losses) relate to the profits/losses earned by the business that have not been distributed and have built up over the
years of trading.
Further details of share issues in the year are shown in note 15 to the accounts.
The notes on pages 22 to 41 are an integral part of these consolidated financial statements.
P a g e | 20
Trafalgar Property Group Plc
CONSOLIDATED STATEMENT OF CASH FLOWS
For the year ended 31 March 2021
Cash flow from operating activities
(Loss) after taxation
Depreciation
Decrease in inventory
(Increase)/decrease in receivables
(Decrease)/increase in payables
Taxation
Interest payable and similar charges
Net cash inflow from operating activities
Investing activities
Purchase of tangible fixed assets
Financing activities
Issue of shares
New loan borrowings
Repaid loan borrowings
Related party new loan borrowing
Related party loan repayment
Repayment of other borrowings
Interest paid
Net cash/(outflow) from financing
2021
£
2020
£
(329,194)
506
(1,022,898)
902
1,134,084 1,303,640
(8,844) 49,783
(70,290) 106,601
-
-
214,260 118,177
940,522 556,205
(986)
(599)
(599) (986)
683,137
51,250
(555,000)
430,338
(771,431)
212,900
1,479,373
(2,502,462)
778,418
-
(490,000) (400,000)
(69,993) (128,279)
(721,699)
(560,050)
Increase/(decrease) in cash and cash equivalents in the year
218,224 (4,831)
Cash and cash equivalents at the beginning of the year
27,969
32,800
Cash and cash equivalents at the end of the year
246,193 27,969
The notes on pages 22 to 41 are an integral part of these consolidated financial statements.
P a g e | 21
Trafalgar Property Group Plc
GROUP ACCOUNTING POLICIES
For the year ended 31 March 2021
-----
--------------------------------------------
-----------------------------
BASIS OF ACCOUNTING
These financial statements are for Trafalgar Property Group Plc (“the Company”) and its subsidiary undertakings
(‘the Group’). The Company is a public company, limited by shares and incorporated in England and Wales.
(company number is 04340125). The Company’s registered office is Chequers Barn, Bough Beech, Edenbridge,
Kent, TN8 7PD.
The nature of the Group’s operations and its principal activities are set out in the Strategic Report on page 5.
BASIS OF PREPARATION
The Group financial statements have been prepared in accordance with International Financial Reporting
Standards (IFRS) and IFRS in conformity with the requirements of Companies Act 2006. These financial
statements are for the year ended 31 March 2021 and are presented in pounds sterling (“GBP”). The
comparative year is for the year to 31 March 2020.
The financial statements have been prepared under the historical cost convention in accordance with applicable
United Kingdom law. The principal accounting policies adopted are set out below.
GOING CONCERN
The Directors have reviewed forecasts and budgets for the coming year, which have been drawn up with
appropriate regard for the current economic environment and the particular circumstances in which the Group
operates. These were prepared with reference to historical and current industry knowledge, taking into account
future strategy of the Group.
The Group continues to utilise banking sources for the financing of its developments, together with loans from
third party investors, to ensure that there is sufficient money available for the Group to undertake and complete its
various developments.
The Group does not operate an overdraft facility but borrow on a site specific basis from various bankers, with
a mix of loans from outside investors geared to some of the development properties and otherwise loaned on a
general basis to the Group.
The Board is comfortable with the structure of its bank finance, which usually involves the bank lending a modest
sum towards the land purchase for the modest sized residential development schemes, with the Group putting up
the rest of the funds required to acquire the site and the costs associated with the acquisition and then for the bank
to provide 100% of the build finance.
Investor loans that are not related to specific sites are long term loans with repayment dates extending beyond the
year end and have, in the past, been renewed when they come up for repayment.
The existing operations have been generating funds to meet short-term operating cash requirements and
management are confident that the expected sales will allow the Group to meet loan repayments due within the
next twelve months or that the loans will be refinanced.
As a result of these considerations, at the time of approving the financial statements, the Directors consider that
the Company and the Group have sufficient resources to continue in operational existence for the foreseeable
future.
However given that a degree of uncertainty exists in the timing of future sales, and management’s ability to
refinance all loans due in the next twelve months, there exists a material uncertainty in relation to the going
concern basis adopted in the preparation of the financial statements.
P a g e | 22
Trafalgar Property Group Plc
GROUP ACCOUNTING POLICIES
For the year ended 31 March 2021
-----
--------------------------------------------
-----------------------------
REVENUE RECOGNITION
Revenue represents the amounts receivable from the sale of properties during the year and other income directly
associated with property development. Revenue from the sale of properties is recognised when the amounts of
revenue and cost can be measured reliably, the significant risks and rewards of ownership have been transferred
to the buyer, neither continuing managerial involvement nor effective control of the property is retained and it is
probable that the economic benefits associated with the sale will flow to the Group/Company. In the majority of
cases properties are treated as sold and profits are recognised at the point of legal completion.
The Directors are of the opinion that this accounting policy accurately reflects commercial reality and the
recording of revenue for the Group.
STANDARDS ISSUED BUT NOT YET EFFECTIVE
Amendments to IAS 1 Presentation of Financial Statements: Classification of Liabilities as Current or
Non-current (issued January 2020)
The amendments clarify that the classification of a liability as current or non-current is based only on rights
existing at the end of the reporting period and the classification is not affected by expectations about whether
rights to settle or defer a liability will be exercised. Further, the amendments clarify that the settlement of a
liability refers to the transfer of cash, equity instruments, other assets, or services to the counterparty. This
amendment only affects presentation.
The amendment is effective for financial years beginning on or after 1 January 2023 and is not yet endorsed for
use under the Companies Act 2006.
The Group does not expect a material impact on its consolidated financial statements from these amendments.
Amendments to IAS 16 Property, Plant and Equipment (issued in May 2020)
The amendments require any proceeds from selling items produced (and related production costs) in the course of
bringing an item property, plant and equipment into operation to be recognised in profit or loss clarifying that
such items are not reflected in the cost of the asset.
The amendment is effective for financial years beginning on or after 1 January 2022 and is not yet endorsed for
use under the Companies Act 2006.
The Group does not expect a material impact on its consolidated financial statements from these amendments.
Amendments to IAS 37 Provisions, Contingent Liabilities and Contingent Assets (issued in May 2020)
The amendments clarify that the cost of fulfilling a contract are costs that relate directly to that contract. Such
costs can be the incremental costs of fulfilling that contract or an allocation of other costs directly related to
fulfilling that contract.
The amendment is effective for financial years beginning on or after 1 January 2022 and is not yet endorsed for
use under the Companies Act 2006.
The Group does not expect a material impact on its consolidated financial statements from these amendments.
Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16 Interest Rate Benchmark Reform – Phase 2
(issued in August 2020)
The amendments are aimed at helping companies to provide investors with useful information about the effects of
the reform of interest rate benchmarks on those companies’ financial statements.
P a g e | 23
Trafalgar Property Group Plc
GROUP ACCOUNTING POLICIES
For the year ended 31 March 2021
-----
--------------------------------------------
-----------------------------
The amendments complement those issued in 2019 and focus on the effects on financial statements when a
company replaces the old interest rate benchmark with an alternative benchmark rate as a result of the reform.
The Phase 2 amendments relate to:
•
changes to contractual cash flows—a company will not have to derecognise or adjust the carrying amount
of financial instruments for changes required by the reform, but will instead update the effective interest rate
to reflect the change to the alternative benchmark rate;
• hedge accounting—a company will not have to discontinue its hedge accounting solely because it makes
changes required by the reform, if the hedge meets other hedge accounting criteria; and
• disclosures—a company is required to disclose information about new risks arising from the reform and how
it manages the transition to alternative benchmark rates.
The amendment is effective for financial years beginning on or after 1 January 2022 and is not yet endorsed for use
under the Companies Act 2006.
The Group does not expect a material impact on its consolidated financial statements from these amendments.
Amendments to IAS 1 and IFRS Practice Statement 2 Disclosure of Accounting Policies (issued in February
2021)
The amendments enhance the disclosure requirements relating to an entity’s accounting policies and clarify that the
notes to a complete set of financial statements are required to include material accounting policy information.
Material accounting policy information, when considered with other information included in the financial
statements, can reasonably be expected to influence decisions that the primary users of financial statements make
on the basis of the financial statements
The amendments help preparers determine what constitutes material accounting policy information and notes that
accounting policy information which focuses on how IFRS has been applied to its own circumstances is more
useful for users of financial statements than standardised information or information duplicating the requirements
of IFRS.
The amendment also states that immaterial accounting policy information need not be disclosed but when it is
disclosed it shall not obscure material accounting policy information. Further, if accounting policy information is
not deemed material this does not affect the materiality of related disclosure requirements of IFRS.
The disclosure of judgements made in applying accounting policies should reflect those that have had the most
significant effect on items recognised in the financial statements.
The amendment is effective for financial years beginning on or after 1 January 2022 and is not yet endorsed for use
under the Companies Act 2006.
Amendments to IAS 8 Definition of Accounting Estimates (issued in February 2021)
The amendments define accounting estimates as monetary amounts in financial statements that are subject to
measurement uncertainty. An accounting policy may require an item in financial statements to be measured at a
monetary amount that cannot be observed directly so that in order to achieve the objective of an accounting policy,
an estimation is required.
The amendments state that the development of an accounting estimate requires the use of judgement or
assumptions based on the latest available reliable information and involve the use of measurement techniques and
inputs. Accounting estimates might then need to change as a result of new information, new developments or more
experience.
A change in input or measurement technique is a change in accounting estimate which is applied prospectively
unless the change results from the correction of prior period errors.
The amendment is effective for financial years beginning on or after 1 January 2023 and is not yet endorsed for use
under.the.Companies.Act.2006.
4
P a g e | 24
Trafalgar Property Group Plc
GROUP ACCOUNTING POLICIES
For the year ended 31 March 2021
-----
--------------------------------------------
-----------------------------
Amendments to IAS 12 Deferred Tax related to Assets and Liabilities arising from a Single Transaction
(issued 7 May 2021)
The amendments specify how companies should account for deferred tax on transactions such as leases and
decommissioning obligations.
In specified circumstances, companies are exempt from recognising deferred tax when they recognise assets or
liabilities for the first time. Previously, there had been some uncertainty about whether the exemption applied to
transactions such as leases and decommissioning obligations—transactions for which companies recognise both an
asset and a liability.
The amendments clarify that the exemption does not apply and that companies are required to recognise deferred
tax on such transactions. The aim of the amendments is to reduce diversity in the reporting of deferred tax on leases
and decommissioning obligations.
The amendments are effective for annual reporting periods beginning on or after 1 January 2023, with early
application permitted and is not yet endorsed for use under the Companies Act 2006.
4
P a g e | 25
Trafalgar Property Group Plc
GROUP ACCOUNTING POLICIES
For the year ended 31 March 2021
-----
--------------------------------------------
-----------------------------
BASIS OF CONSOLIDATION
The consolidated financial statements incorporate the financial statements of the Group and its subsidiaries.
The results of subsidiaries acquired during the year are included from the date of acquisition, being the date on
which the Group obtains control. They are deconsolidated on the date that control ceases.
The consideration transferred for the acquisition of a subsidiary is the fair value of the assets transferred, the
liabilities incurred and the equity interests issued by the Group. This fair value includes any contingent
consideration. Acquisition-related costs are expensed as incurred.
When the Group ceases to have control or significant influence, any retained interest in the entity is re measured
to its fair value, with the change in carrying amount recognised in profit or loss. The fair value is the initial
carrying amount for the purposes of subsequently accounting for the retained interest as an associate, joint
venture or financial asset. In addition, any amounts previously recognised in other comprehensive income in
respect of that entity are accounted for as if the Group had directly disposed of the related assets or liabilities.
This may mean the amounts previously recognised in other comprehensive income are reclassified to profit or
loss.
Control is achieved when the Group:
- has the power over the investee;
- is exposed or his rights, to variable returns from its involvement with the investee; and
- has the ability to use its power to affect its returns.
FUNCTIONAL CURRENCY
Items included in the financial statements of each of the Group’s entities are measured using the currency of the
primary economic environment in which the entity operates (‘the functional currency’). The consolidated
financial statements are presented in Pounds Sterling (£), which is the Company’s functional and the Group’s
presentation currency.
DEFINED CONTRIBUTION PENSION PLAN
The Group operates a defined contribution plan for its employees. A defined contribution plan is a pension plan
under which the Group pays fixed contributions into a separate entity. Once the contributions have been paid the
Group has no further payments obligations.
The contributions are recognised as an expense in the profit or loss when they fall due. Amounts not paid are
shown in accruals as a liability in the Statement of Financial Position. The assets of the plan are held separately
from the Group in independently administered funds
FINANCIAL INSTRUMENTS
The Company recognises financial instruments when it becomes a party to the contractual arrangements of the
instrument. Financial instruments are de-recognised when they are discharged or when the contractual term
expire. The Company’s accounting policies in respect of financial instruments transactions are explained below:
Financial assets and financial liabilities are initially measured at fair value.
Financial assets:
All recognised financial assets are subsequently measured in their entirety at either fair value or amortised cost,
depending on the classification of the financial assets.
Fair value through profit or loss
All of the Company’s financial assets other than those which meet the criteria to be measured at amortised cost
are subsequently measured at fair value at the end of each reporting period, with any fair value gains or losses
P a g e | 26
Trafalgar Property Group Plc
GROUP ACCOUNTING POLICIES
For the year ended 31 March 2021
-----
--------------------------------------------
-----------------------------
being recognised in profit or loss to the extent they are not part of a designated hedging relationship. The net
gain or loss recognised in profit or loss includes any dividend or interest earned on the financial asset.
Debt instruments at amortised cost
Debt instruments are subsequently measured at amortised cost where they are financial assets held within a
business model whose objective is to hold financial assets in order to collect contractual cash flows and selling
the financial assets, and the contractual terms of the financial asset give rise on specified dates to cash flows that
are solely payments of principal and interest on the principal amount outstanding. Amortised cost is calculated
using the effective interest method and represents the amount measured at initial recognition less repayments of
principal plus the cumulative amortisation using the effective interest method of any difference between the
initial amount and the maturity amount, adjusted for any loss allowance.
Trade payables
Trade payables are initially measured at fair value and are subsequently measured at amortised cost, using the
effective interest rate method.
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of direct issue costs. Shares
issued are held at their fair value.
Share capital
Ordinary share capital is classified as equity. Interim ordinary dividends are recognised when paid and final
ordinary dividends are recognised as a liability in the year in which they are approved.
Impairment of financial assets
The Company recognises a loss allowance for expected credit losses (ECL) on investments in debt instruments
that are measured at amortised cost or FVTOCI, lease receivables, amounts due from customers under
construction contracts, as well as on loan commitments and financial guarantee contracts. No impairment loss is
recognised for investments in equity instruments. The amount of expected credit losses is updated at each
reporting date to reflect changes in credit risk since initial recognition of the respective financial instrument.
The Company recognises lifetime ECL on all financial instruments where there has been a significant increase in
credit risk since initial recognition. The assessment of whether lifetime ECL should be recognised is based on
significant increase in the likelihood or risk of a default occurring since initial recognition instead of on evidence
of a financial asset being credit-impaired at the reporting date or an actual default occurring.
Lifetime ECL represents the expected credit losses that will result from all possible default events over the
expected life of a financial instrument. In contract, 12 month ECL represents the portion of lifetime ECL that is
expected to result from default events on a financial instrument that are possible within 12 months after the
reporting date.
In assessing whether the credit risk on a financial instrument has increased, the following shall be taken into
account:
- Actual or expected significant deterioration in the financial instrument’s external or internal credit rating; or
- Significant deterioration in external market conditions; or
- Existing or forecast adverse changes in business, financial or economic conditions that will impact the debtor’s
ability to meet debt obligations; or
- Actual or expected deterioration in the operating results of the debtor; or
- Actual or expected significant adverse changes in the regulatory or technological environment of the debtor
that will impact the debtor’s ability to meet debt obligations.
For certain categories of financial asset, such as trade receivables, assets that are assessed not to be impaired
individually are subsequently assessed for impairment on a collective basis. Objective evidence of impairment
for a portfolio of receivables could include the Company's past experience of collecting payments, an increase in
the number of delayed payments in the portfolio past the average credit period of 30 days, as well as observable
that correlate with default on receivables.
changes
local economic conditions
the national or
in
P a g e | 27
Trafalgar Property Group Plc
GROUP ACCOUNTING POLICIES
For the year ended 31 March 2021
-----
--------------------------------------------
Financial liabilities:
-----------------------------
Fair value through profit or loss
Financial liabilities are classified as at fair value through profit or loss, when the financial liability is held for
trading, or is designated as at fair value through profit or loss. This designation may be made if such designation
estimates or significantly reduces a measurement or recognition inconsistency that would otherwise arise, or the
financial liability forms part of a group of financial instruments which is managed and its performance is
evaluated on a fair value basis, or the financial liability forms part of a contract containing one or more
embedded derivatives, and IFRS 9 permits the entire combined contract to be designated as at fair value through
profit or loss. Any gains or losses arising on changes in fair value are recognised in profit or loss to the extent
that they are not part of a designated hedging relationship.
At amortised cost
Financial liabilities which are neither contingent consideration of an acquirer in a business combination, held for
trading, nor designated as at fair value through profit or loss are subsequently measured at amortised cost using
the effective interest method. This is a method of calculating the amortised cost of a financial liability and of
allocating interest expense over the relevant period. The effective interest rate is the rate that exactly discounts
estimated future cash payments through the expected life of the financial liability, or where appropriate a shorter
period, to the amortised cost of a financial liability.
Derecognition of financial liabilities
The company derecognises financial liabilities when, and only when, the company's obligations are discharged,
cancelled or they expire.
CASH AND CASH EQUIVALENTS
Cash and cash equivalents comprise cash balances and deposits held at call with banks with maturities of three
months or less from inception.
INVENTORIES
Inventories consist of properties under construction and are stated at the lower of cost and net realisable value.
Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been
incurred in bringing the inventories to their present location and condition. Interest on sums borrowed that
finance specific projects is added to cost. Net realisable value represents the estimated selling price less all
estimated costs of completion and costs to be incurred in marketing, selling and distribution.
PROPERTY PLANT AND EQUIPMENT
Property, plant and equipment are stated at cost, net of depreciation and any provision for impairment.
Depreciation is calculated to write down the cost less estimated residual value of all tangible fixed assets using
the reducing balance method over their expected useful economic lives. The rates generally applicable are:
Fixtures, fittings and equipment - 25% on reducing balance
INVESTMENT PROPERTY
Investment property, which is property held to earn rentals and/or for capital appreciation (including property
under construction for such purposes), is measured initially at cost, including transaction costs. Subsequent to
initial recognition, investment property is measured at fair value. Gains or losses arising from changes in the fair
value of investment property are included in profit or loss in the period in which they arise.”
FINANCIAL LIABILITIES AND EQUITY
Financial liabilities and equity instruments issued by the Group are classified according to the substance of the
contractual arrangements entered into and the definitions of a financial liability and an equity instrument. An
P a g e | 28
Trafalgar Property Group Plc
GROUP ACCOUNTING POLICIES
For the year ended 31 March 2021
-----
--------------------------------------------
-----------------------------
equity instrument is any contract that evidences a residual interest in the assets of the Group after deducting all of its
liabilities. The accounting policies adopted for specific financial liabilities and equity instruments are set out below.
BORROWING COSTS
Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets
that take a substantial period of time to be completed for sale, are added to the cost of property held as stock at the year end.
All other borrowing costs are recognised in the profit or loss in the year in which they relate.
CURRENT AND DEFERRED TAXATION
Current tax assets and liabilities for the current and prior years are measured at the amount expected to be recovered from or
paid to the tax authorities. The tax rates and the tax laws used to compute the amount are those that are enacted or
substantively enacted, by the reporting date.
The tax expense represents the sum of the tax currently payable and deferred tax.
The 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 Group's liability for current tax is calculated using tax
rates that have been enacted or substantively enacted by the reporting date.
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. 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 goodwill or from the initial recognition
(other than in a business combination) of other assets and liabilities in a transaction that affects neither the tax profit nor the
accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting 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 charged or credited in profit or loss, except when it relates to items charged or credited
directly to other comprehensive income, in which case the deferred tax is also dealt with in other comprehensive income.
PROVISIONS
Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event
and it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and
a reliable estimate can be made of the amount of the obligation. Where the Group expects some or all of a provision to
be reimbursed, the reimbursement is recognised as a separate asset but only when the reimbursement is virtually certain.
The expense relating to any provision is presented in the income statement net of any reimbursement. If the effect of the
time value of money is material, provisions are discounted using a current pre-tax rate that reflects, where appropriate,
the risks specific to the liability. Where discounting is used, the increase in the provision due to the passage of time is
recognised as a borrowing cost.
COMMITMENTS AND CONTINGENCIES
Commitments and contingent liabilities are disclosed in the financial statements. They are disclosed unless the
possibility of an outflow of resources embodying economic benefits is remote. A contingent asset is not recognised in
the financial statements but disclosed when an inflow of economic benefits is virtually certain.
P a g e | 29
Trafalgar Property Group Plc
GROUP ACCOUNTING POLICIES
For the year ended 31 March 2021
-----
--------------------------------------------
-----------------------------
CRITICAL ACCOUNTING JUDGMENTS AND KEY SOURCES OF ESTIMATION AND
UNCERTAINTY
The preparation of financial statements in conformity with International Financial Reporting Standards (IFRS) and
IFRS in conformity with the requirements of the Companies Act 2006 requires the use of certain critical
accounting estimates. It also requires management to exercise its judgment in the process of applying the
Group’s accounting policies. The areas involving a higher degree of judgment or complexity, or areas where
assumptions and estimates are significant to the Group financial statements are disclosed below.
Estimates and judgments are continually evaluated and are based on historical experience and other factors,
including expectations of future events that are believed to be reasonable under the present circumstances.
Valuation of Inventory
The Group assesses the net realisable value of inventories under development and completed properties held for
sale according to their recoverable amounts based on the realisability of these properties, taking into account
estimated costs to completion based on past experience and committed contracts and estimated net sales based
on prevailing market conditions. Provision is made when events or changes in circumstances indicate that the
carrying amounts may not be realised. The carrying value is reduced by its selling price less costs to complete
and sell. This impairment loss is recognised immediately in profit or loss. The assessment requires the use of
judgment and estimates. The carrying amount of inventory is disclosed in note 12 to the financial statements.
Recognition of deferred tax assets
The recognition of deferred tax assets is based upon whether it is more likely than not that sufficient and suitable
taxable profits will be available in the future against which the reversal of temporary differences can be
deducted. To determine the future taxable profits, reference is made to the latest available profit forecasts.
Where the temporary differences are related to losses, relevant tax law is considered to determine the availability
of the losses to offset against the future taxable profits.
Impairment of non financial assets
At each statement of financial position date the company reviews the carrying amounts of its tangible and
intangible assets with finite lives to determine whether there is an indication that those assets have suffered an
impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to
determine the extent of the impairment loss (if any).
If the recoverable amount of an asset is estimated to be less than its carrying amount, the carrying amount of the
asset is reduced to its recoverable amount. Impairment losses are recognised as an expense immediately, unless
the relevant asset is land or buildings at a revalued amount, in which case the impairment loss is treated as a
revaluation decrease.
Where an impairment loss subsequently reverses, the carrying amount of the asset is increased to the revised
estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying
amount that would have been determined had no impairment loss been recognised for the asset in prior years. A
reversal of an impairment loss is recognised as income immediately, unless the relevant asset is carried at a
revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
P a g e | 30
Trafalgar Property Group Plc
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 March 2021
1 SEGMENTAL REPORTING
For the purpose of IFRS 8, the chief operating decision maker (“CODM”) takes the form of the Board of
Directors. The Directors’ opinion of the business of the Group is as follows.
The principal activity of the Group was property development. All the Group’s non-current assets are located in
the UK.
Based on the above considerations, there is considered to be one reportable segment. The internal and external
reporting is on a consolidated basis with transactions between Group companies eliminated on consolidation.
Therefore the financial information of the single segment is the same as that set out in the consolidated statement
of comprehensive income, the consolidated statement of changes in equity, the consolidated statement of
financial position and cashflows.
Revenue
An analysis of revenue is as follows:
The Group’s revenue, which is all attributable to their principal activity, can be split as follows:
2021 2020
£
Development sales 2,212,500 1,891,000
Rental income 73,300 79,106
2,285,800 1,970,106
£
Timing of revenues are as follows:
2021 2020
£ £
Goods transferred at a point in time 2,212,500 1,891,000
Rental income transferred over time . 73,300 79,106
2,285,800 1,970,106
Revenues analysed by geographic location are as follows:
2021 2020
£ £
United Kingdom 2,285,800 1,970,106
2 OTHER INCOME
Other income consists of sums received by way of furlough sums claimed for one employee as a result of
Covid-19 during the first lockdown.
P a g e | 31
Trafalgar Property Group Plc
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 March 2021
3 LOSS FOR THE YEAR
Operating loss is stated after charging / (crediting) the following:
Subcontractor costs and cost of inventories recognised as an expense
Interest charges
2021
£
1,945,107
18,687
1,963,794
2020
£
1,687,759
128,279
1,816,038
Depreciation of property, plant and equipment
506
902
Auditor’s remuneration – audit services – Group
Auditor’s remuneration – audit services – Group entities
Auditor’s remuneration – other assurance services – Group
Operating expenses by nature:
Subcontractors costs, interest and consumables
Employee expenses
Depreciation
Other expenses
Consultancy Services – P Treadaway
Debt forgiveness
4 EMPLOYEES AND DIRECTORS’ REMUNERATION
Staff costs during the year were as follows:
Wages and salaries
Social security costs
Other pension costs
The average number of employees of the Group during the year was:
Directors
Management
10,000
15,650
5,000
30,650
1,963,794
,38
199,219
506
264,238
-
-
2,427,757
10,000
7,000
-
17,000
1,816,038
141,552
902
994,395
70,108
(70,108)
2,952,887
2021
£
165,000
14,179
20,040
199,219
2020
£
113,000
8,512
20,040
141,552
2021
Number
4
2020
Number
3
1 2
Key management are the Group’s Directors. Remuneration in respect of key management was as follows:
Short-term employee benefits:
- Emoluments for qualifying services J Dubois
- Emoluments for qualifying services A Johnson
- Emoluments for qualifying services P Treadaway
- Emoluments for qualifying services G Thorneycroft
2021
£
30,000
45,000
60,000
7,000
2020
£
15,879
48,550
-
-
142,000
64,429
There are retirement benefits accruing to Mr C C Johnson for whom a company contribution was paid during the
...year of £18,000 (2020: £18,000) and Mr A Johnson £ 1,350 (2020: £1,350).
Consultancy fees of £ 9,998 (2020: £4,994) were paid to Mr N Lott during the year.
P a g e | 32
Trafalgar Property Group Plc
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 March 2021
5 INTEREST PAYABLE AND SIMILAR CHARGES
During the year the mortgage interest paid on borrowings relating to ongoing developments was capitalised as
part of inventory £ nil (2020: £ 10,102) with the interest on properties sold in the year forming part of cost of
sales and transferred to profit & loss accordingly. For sites where the construction had been completed, the bank
loan interest paid during the year on these sites of £ 18,687 (2020: £118,177) has been accounted for in the
profit & loss within cost of sales.
In addition, interest of £214,260 (2020: £40,117) has been paid on general funding loans, rental property
mortgage loan and provisions for interest on loan notes, further details are provided in notes 15 and 17.
6 TAXATION
Current tax
Tax charge
2021
£
2020
£
-
-
-
-
2021
£
2020
£
(Loss)/profit on ordinary activities before tax
(329,194)
(1,022,898)
Based on (loss) for the year:
Tax at 19% (2020: 19%)
Unrelieved tax losses
Impairment
Tax losses carried forward
Tax charge for the year
Deferred tax
(62,546)
(194,350)
76,411
(4,206)
- 116,968
971
66,752
-
-
No deferred tax asset has been recognised in respect of historical losses due to the uncertainty in future profits
against which to offset these losses. As at the 31 March 2021, the Group had cumulative tax losses of
£ 4,645,489 (2020: £4,381,991) that are available to offset against future taxable profits of the same trade.
7 (LOSS) PER ORDINARY SHARE
The calculation of (loss)/profit per ordinary share is based on the following profits/(losses) and the number
of shares used should be that retrospectively adjusted for the effect of consolidation:
(Loss) for the year
2021
2020
£
£
(329,194)
(1,022,898)
Weighted average number of shares for basic (loss) per share
Weighted average number of shares for diluted (loss) per share
95,644,038 487,690,380
95,644,038 487,690,380
(LOSS) PER ORDINARY SHARE:
Basic
Diluted
(0.21)p
(0.34)p
(0.34)p (0.21)p
P a g e | 33
Trafalgar Property Group Plc
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 March 2021
8 PROPERTY, PLANT AND EQUIPMENT
Plant and equipment
Cost
At 1 April
Additions
At 31 March
Depreciation
At 1 April
Charge for the year
At 31 March
2021
£
7,191
599
7,790
2020
£
6,205
986
7,191
5,768
4,866
506 902
5,768
6,274
Net book value at 31 March 1,516 1,423
9 INVESTMENT PROPERTY
FAIR VALUE
1 April 2020
Additions
31 March 2021
NET BOOK VALUE
At 31 March 2021
At 31 March 2020
Fair Value at 31 March 2021 is represented by:
Valuation in 2019
2021
£
1,975,000
-
1,975,000
2020
£
-
1,975,000
1,975,000
1,975,000
1,975,000
1,975,000
1,975,000
1,975,000
1,975,000
The Directors consider there has been no change in the valuation since purchase of the properties in August
2019 and therefore the property remains in the accounts as at 31 March 2021 at £1,975,000.
10 TRADE AND OTHER RECEIVABLES
Other receivables
Other taxes
Prepayments
2021
£
2020
£
24,000
700
11,071 16,480
21,684 1,819
33,455 42,299
There are no receivables that are past due but not impaired at the year-end. There are no provisions for
irrecoverable debt included in the balances above.
P a g e | 34
Trafalgar Property Group Plc
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 March 2021
11 CASH AND CASH EQUIVALENTS
All of the Group's cash and cash equivalents at 31 March 2021 are in sterling and held at floating interest
rates.
Cash and cash equivalents
2021
£
2020
£
246,193
27,969
The Directors consider that the carrying amount of cash and cash equivalents approximates to their fair value.
12 INVENTORY
2021 2020
£ £
Work in progress 78,608 1,212,692
See note 5 for details of interest capitalised as part of the value of inventory.
13 TRADE AND OTHER PAYABLES
Trade payables
Other payables
Taxation & social security
Accruals
14 BORROWINGS
Directors’ loans
Other loans
Bank loans - see under
2021
£
2020
£
23,438
85,950
- 28,130
3,422
22,575
431,302
432,501
478,514
548,804
2021
£
2020
£
3,152,865
741,250
924,373
4,818,488
3,471,511
1,180,000
1,479,373
6,130,884
Included in Directors’ loans is the sum of £ 150,000 (2020: £300,000) advanced by the DFM Pension Scheme of
which Mr J Dubois is the principal beneficiary. This loan bears interest at 12% per annum (2020: 12% per
annum).
Within Directors’ loans is the sum of £ 240,000 (2020: £ 240,000) provided by Mr C C Johnson for a deposit
on an option which was not taken up, together with the sum of £ 528,925 in relation to convertible loan notes
issued to Mr C C Johnson on 14 July 2020. These have a nominal value of £ 600,000 and are repayable on 31
July 2022. As a financial instrument with both debt and equity components, an amount was recognised directly
into a Loan Note Equity Reserve on issue, as explained further in Note 15, with the debt element being unwound
at an implied interest rate of 10% and the interest recognized through profit and loss.
The remaining balance is disclosed in note 16.
P a g e | 35
Trafalgar Property Group Plc
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 March 2021
Included in other loans is £ 600,000 (2020: £ 650,000) advanced by Mr G Howard (son-in-law to Mr C C
Johnson to the company at rates of 10% & 5% per annum (2020: 10% pa). £ 90,000 (2020: £530,000) has
been advanced by C Rowe, a former employee of the Group, at a rate of 10% per annum.
During the year the loan with Lloyds Bank who held a legal charge over land at Wellesley Road, Sheerness,
Kent, was cleared following the successful sale of all units.
Mrs S Johnson, wife of Mr C C Johnson has a legal charge on flats 3 & 5 Burnside Court Sandhurst Road,
Tunbridge Wells Kent of £ 380,000 (2020: £380,000) in connection with her loan to Selmat.
Selmat has also granted to Paragon Mortgages, legal charges over the freehold property at Hildenborough and
leasehold properties of one of the three flats at Burnside. These mortgages are interest only, for a term of 7 years
with a fixed interest rate for the first 5 years. These properties are rented out.
The bank borrowings are repayable as follows:
On demand or within one year
In the second year
In the third to fifth years inclusive
After five years
Less amount due for settlement within 12 months
(included in current liabilities)
Amount due for settlement after 12 months
2021
£
_
2020
£
-
-
555,000
-
-
924,373 924,373
1,479,373
924,373
-
924,373
555,000
924,373
The weighted average interest rates paid on the bank loans were as follows:
Bank loans: 3.4 % (2020: 2.03%)
All of the Directors’ loans are repayable after more than 1 year. All loans are interest bearing and charged
accordingly. However Mr C C Johnson has waived his right to interest in the year with the exception of the first £
500,000. Interest of £ 25,000 (2020: nil) was paid to him during the year. Interest of £32,761 (2020:
£36,000) was paid to Mr J Dubois at the rate of 12% pa (2020: 12% pa).
15 SHARE CAPITAL
Issued allotted & paid share capital
Ordinary shares
Ordinary shares of 0.01p (2020: 0.1p) in
issue
Ordinary shares of 0.01p (2020: 0.1p) issued in year
Total ordinary shares of 0.01p (2020: 0.1p) in issue
,,,,,…2021
….Number
2020
Number
487,690,380
937,500,000
1,425,190,380
425,190,380
62,500,000
487,690,380
Total ordinary shares of 0.1p in issue following consolidation
142,519,038
-
Deferred shares
Deferred shares of 0.9p in issue
Deferred shares of 0.9p arising in year from re-organisation
Total Deferred shares of 0.9p in issue
238,375,190
48,769,038
287,144,228
238,375,190
-
238,375,190
P a g e | 36
Trafalgar Property Group Plc
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 March 2021
On 13 July, 2020 the Company undertook a sub-division of its ordinary shares, which sub divided the
487,690,380 ordinary shares of 0.1p each into 487,690,380 ordinary shares of 0.01p each and 487,690,380
deferred shares of 0.09p each. The deferred shares of 0.09p each were consolidated into deferred shares of 0.9p
each ranking pari passu as one class with the existing deferred shares of 0.9p each.
On 14 July 2020, 937,500,000 ordinary shares of 0.01p each were issued under a placing at 0.08p each (at a
premium of 0.07p per share) to raise £750,000 before costs of £ 66,863.
In addition, on 14 July 2020, warrants to subscribe for ordinary shares of 0.01p were granted as follows:
(a) Subscribers to the placing were granted warrants to subscribe for up to 937,500,000 shares for a period of
two years, exercisable at 0.2p per share;
(b) Peterhouse Capital Limited was granted warrants to subscribe for shares equivalent up to 3% of the issued
ordinary share capital for time to time, exercisable for a period of two years, at 0.08p per share.
Following the consolidation of ordinary shares in December 2020, the warrants have been adjusted and comprise
placee warrants to subscribe for up to 93,750,000 ordinary shares of 0.1p at 2p per share, and the warrants held
by Peterhouse Capital Limited are exercisable at 0.8p per share.
In relation to the granting of these warrants to Peterhouse Capital Limited, these fall under the requirements of
IFRS 9 Financial Instruments and as such are accounted for at fair value through profit or loss. At the grant date
of these warrants these are valued using a Black Scholes model to determine the intrinsic value of the warrant
and a liability is recognized for this amount with a corresponding expense through the income statement. The
Directors’ have concluded that the intrinsic value of the warrant as at 31 March 2021 is not material to the results
and subsequent movements in the share price have decreased this value further. As such no accounting entries
have been made to these results.
Further on 14 July 2020, £ 600,000 of convertible loan notes were issued to Mr C C Johnson as part of
arrangements to reorganize loans between him and the Group. The notes are repayable on 31 July 2022 and are
convertible at any time into 300,000,000 ordinary shares of 0.01p at 0.2p per share. On conversion, warrants to
subscribe for up to 300,000,000 ordinary shares will be granted to Mr C C Johnson exercisable for a period of
two years from the date of grant at 0.2p per share. Following the consolidation of ordinary shares in December
2020, the loan notes have been adjusted and are convertible into 30,000,000 ordinary shares of 0.1p at 2p per
share, with warrants to be granted to subscribe for up to 30,000,000 ordinary shares of 0.1p each at 2p per share.
The convertible loan notes have been accounted for as having both a debt and an equity element. This results in
the creation of a loan note equity reserve at the point of issue. This loan note equity reserve is the difference
between the loan note value received by the company of £ 600,000 and the fair value of a debt only instrument
with a 10% imputed interest rate and a final settlement figure of £ 600,000 in July 2022. This 10% imputed
interest rate of £ 33,058 (2020: nil), is managements’ best estimate as to the interest rate that would be expected
from the market for an unsecured loan of £ 600,000 without a conversion element.
Ordinary shares entitle the holder to receive notice of and to attend or vote at any general meeting of the
Company or to receive dividends or other distributions.
Deferred shares do not entitle the holder to receive notice of and to attend or vote at any general meeting of the
Company or to receive dividends or other distributions. Upon winding up or dissolution of the Company the
holders of deferred shares shall be entitled to receive an amount equal to the nominal amount paid up thereon, but
only after holders of ordinary shares have received £ 100,000 per ordinary share. Holders of deferred shares are
not entitled to any further rights of participation in the assets of the Company. The Company has the right to
purchase the deferred shares in issue at any time for no consideration.
On 29 December 2020, for every ten of the 1,425,190,380 ordinary shares of 0.01p then in issue, were
consolidated into one ordinary share of 0.1p resulting in there being 142,519,038 ordinary shares of 0.1p in issue.
P a g e | 37
Trafalgar Property Group Plc
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 March 2021
Issued, allotted and fully paid
Ordinary shares
Deferred shares
Issued in year - ordinary shares
Issued in year – deferred shares
2021
£
2020
£
48,769
2,145,377
93,750
438,921
2,726,817
425,190
2,145,377
62,500
-
2,633,067
For the purpose of preparing the consolidated financial statement of the Group, share capital represents the
nominal value of the issued share capital of 0.1p per share (2020: 0.1p per share). Share premium represents the
excess over nominal value of the fair value consideration received for equity shares net of expenses plus
deferred shares of 0.9p after issued share capital of 1p.
16 RELATED PARTY TRANSACTIONS
Mr C C Johnson held 18,681,580 ordinary 0.1p shares in the Group as at 31 March 2021 (2020: 186,815,803
ordinary 0.01p).
Mr J Dubois held 400,000 ordinary 0.1p shares in the Group as at 31 March 2021 (2020: 4,000,000 ordinary
…0.01p.
Mr D C Stocks held no ordinary 0.1p shares in the Group as at 31 March 2021 (2020: 80,330,532 ordinary
0.01p). He sold his entire shareholding during the year.
Mr N Lott held 50,000 ordinary 0.1p shares in the Group as at 31 March 2021 (2020: 500,000 ordinary 0.01p).
Mr P Treadaway held 19,733,466 ordinary 0.1p shares in the Group as at 31 March 2021 (2020: 106,484,658
ordinary 0.01p).
Mr G Thorneycroft held 600,000 ordinary 0.1p shares in the Group as at 31 March 2021 (2020: nil).
Further details relating to share option and warrants can be found under note 17.
The following working capital loans have been provided by the Directors:
2021
£
2020
£
C C Johnson
Opening balances
Loan repayments
Personal drawings
Capital injected
Interest payable
Balance carried forward
3,171,511
(526,000)
(95,431)
427,785
25,000
3,002,865
2,417,146
-
(141,910)
896,275
-
3,171,511
J Dubois
Opening balances
Loan repayments
Balance carried forward
300,000
300,000
(150,000)
… 150,000
-
300,000
Directors balances carried forward 3,152,865 3,471,511
3,152
Directors balances carried forward
Mr Johnson’s Loan bore interest during the year at 5% (2020: 5% pa), but he has chosen to forego the interest in
both years with the exception of the first £ 500,000 in this year only, (2020: exception £ nil). Mr Johnson received
£ 25,000 interest (2020: nil). Mr Johnson is no longer a Director , but he served as a Director for part of the
previous year and remains a shareholder. Mr Dubois’s Loan, which is from his Pension Fund of which he is the
sole beneficiary, was at 12% pa interest (2020: 12% pa).
P a g e | 38
Trafalgar Property Group Plc
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 March 2021
Mrs S Johnson, wife of Mr C C Johnson provided a Loan of £380,000 (2020: £ 380,000) which bore interest of
5% pa, (2020: 5% pa), to Selmat, a subsidiary of the Group. This has been included within Mr C C Johnson’s
loan balance above.
During the year rents were paid of £7,692 (2020: £10,000) to the Combe Bank Homes Pension Scheme which
owns the freehold offices at Chequers Barn. Mr C C Johnson is a Trustee and Beneficiary of that Pension
Scheme.
Prior to Mr P Treadaway’s appointment as a Director, charges of n i l ( 2 0 2 0 : £70,108) were paid to
him in relation to consultancy services. Mr P Treadaway now takes remuneration as shown in note 4.
During the year payments were made to Mr D Stocks of nil (2020: £68,936) and to Mr N Lott of £9,998 (2020:
£ 4,994) for consultancy services.
17 SHARE OPTIONS AND WARRANTS
Share options or warrants as at the year end are as follows (2020:nil)
On 14 July 2020 warrants to subscribe for ordinary shares of 0.01p were granted as follows:
(a) Subscribers to the placing effected in July 2020 were granted warrants to subscribe for up to 937,500,000
shares for a period of two years, exercisable at 0.2p per share;
(b) Peterhouse Capital Limited was granted warrants to subscribe for shares equivalent up to 3% of the issued
ordinary share capital from time to time, exercisable for a period of two years, at 0.08p per share.
Following the consolidation of ordinary shares in December 2020, the warrants have been adjusted and comprise
placee warrants to subscribe for up to 93,750,000 ordinary shares of 0.1p at 2p per share, and the warrants held
by Peterhouse Capital Limited are exercisable at 0.8p per share.
Further on 14 July 2020 £ 600,000 of convertible loan notes were issued to Mr C C Johnson as part of
arrangements to reorganize loans between him and the Group. The notes are repayable on 31 July 2022 and are
convertible at any time into 300,000,000 ordinary shares of 0.01p at 0.2p per share. On conversion warrants to
subscribe for up to 300,000,000 ordinary shares will be granted to Mr C C Johnson exercisable for a period of
two years from the date of grant at 0.2p per share. Following the consolidation of ordinary shares in December
2020, the loan notes have been adjusted and are convertible into 30,000,000 ordinary shares of 0.1p at 2p per
share, with warrants to be granted to subscribe for up to 30,000,000 ordinary shares of 0.1p each at 2p per share.
18 CATEGORIES OF FINANCIAL INSTRUMENTS
All financial instruments are measured under IFRS 9 at amortised cost.
Capital risk management
The Group considers its capital to comprise its share capital and share premium. The Group’s capital
management objectives are to safeguard the entity’s ability to continue as a going concern, so that it can
continue to provide returns for shareholders and benefits for other stakeholders and to provide an adequate
return to shareholders by pricing products and services commensurately with the level of risk.
P a g e | 39
Trafalgar Property Group Plc
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 March 2021
Significant Accounting Policies
Details of the significant accounting policies and methods adopted, including the criteria for recognition,
the basis of measurement and the basis on which income and expenses are recognised, in respect of each class of
financial asset, financial liability and equity instrument are disclosed on pages 22 to 30 to these financial
statements.
Foreign currency risk
The Group has minimal exposure to the differing types of foreign currency risk. It has no foreign currency
denominated monetary assets or liabilities and does not make sales or purchases from overseas countries.
Interest rate risk
The Group is sensitive to changes in interest rates where interest is charged on a variable rate basis. This risk
has been minimized by:
- the bank loan being repaid in full during the year, which was on a variable rate basis,
- renegotiation of interest rates on some of the other loans from 10% to 5% (all fixed rates),
- partial repayments made in the year on other loans and,
- the Paragon mortgages which are on a fixed rate for the first five years of the seven year term.
The impact of a 100 basis point increase in interest rates on these loans would result in additional interest cost
for the year of £ Nil (2020: £14,794).
Credit risk management
Credit risk refers to the risk that a counter-party will default on its contractual obligations resulting in financial
loss to the Group.
Liquidity risk management
This is the risk of the Group not being able to continue to operate as a going concern.
The Directors have, after careful consideration of the factors set out above, concluded that it is appropriate to
adopt the going concern basis for the preparation of the financial statements and the financial statements do not
include any adjustments that would result if the going concern basis was not appropriate.
Derivative financial instruments
The Group does not currently use derivative financial instruments as hedging is not considered necessary.
Should the Group identify a requirement for the future use of such financial instruments, a comprehensive set of
policies and systems as approved by the Directors will be implemented.
Financial liabilities
Total
Due within
1 year
£
Due within
1-5 years
£
Due over
5 Years
£
Trade payables
Borrowings – Directors’ loan
Borrowings – Bank loan
Borrowings – Other loans
Total 5,274,427 455,939 3,894,115 924,373
455,939
3,152,865
924,373
741,250
3,152,865
-
741,250
455,939
-
924,373
P a g e |40
44039
Trafalgar Property Group Plc
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 March 2021
19 EXCEPTIONAL ITEM
Management have performed a review of the assets of its trading subsidiaries. Consequently, inventory valued
at £ nil (2020: £432,268) less potential deferred tax of nil (2020: £ nil) has been written off in the financial
statements. Within TNH the sum of nil (2020:£ 163,184) has been written off which related to costs incurred to
date on a site where planning permission has not been achieved despite several submission attempts and finally
this was taken to appeal where this was also turned down.
20 NET DEBT RECONCILIATION
Cash at bank
Cash and cash equivalents
2021
£
2020
£
246,193
246,193
27,969
27,969
Borrowing repayable within one year (including overdrafts)
(4,818,488)
(6,130,884)
Net Debt
(4,572,295)
(6,102,915)
Cash and
liquid
investments
£
Gross
borrowings
with a fixed
interest rate
£
Total cash
and liquid
investments
£
Net debt as at 1 April 2019 32,800
Cash flows (4,831)
(6,775,565)
644,681
(6,742,765)
639.850
Net debt as at 31 March 2020 27,969
Cash flows 218,224
(6,130,884)
(6,102,915)
1,312,396 1,530,620
Net debt as at 31 March 2021 246,193
(4,818,488)
(4,572,295)
21 SUBSEQUENT EVENTS
Events following the year-end that provide additional information about the Group’s position at the reporting
date and are adjusting events are reflected in the financial statements. Events subsequent to the year-end
that are not adjusting events are disclosed in the notes when material.
Following the year end, a further loan repayment of £ 50,000 has been made to the DFM Pension Scheme in
which Mr J Dubois is the principal beneficiary.
P a g e | 41
Trafalgar Property Group Plc
COMPANY BALANCE SHEET
For the year ended 31 March 2021
FIXED ASSETS
Investments
Current assets
Stocks
Debtors
Cash at bank and in hand
EQUITIES & LIABILITIES
Current liabilities
Trade & other payables
Non-current liabilities
Borrowings
Total liabilities
Net (liabilities)/assets
Note
2021
£
2020
Restated £
7
8
-
-
-
-
-
22,159
84,219
106,378
-
350,134
3,538
353,672
9
652,662
652,662
873,264
873,264
10
33,926
686,588
105,000
978,264
-
(580,210) (624,592)
Called up share capital
Share premium account
Loan note equity reserve
Profit and loss account
Equity – attributable to the owners of the Parent
12
2,726,817
3,250,249
104,132
(6,661,408)
(580,210)
2,633,067
2,660,862
-
(5,918,521)
(624,592)
Total Equity & Liabilities 106,378 353,672
The loss for the financial year dealt with in the financial statements of the Parent Company was Loss £ 742,887
(2020: Loss £135,165 ).
The financial statements were approved by the Board of Directors on 6 September 2021 and authorised for
issue and are signed on its behalf by:
P Treadaway: ………………………………………. J Dubois: ……………………………………………
Company Registration Number: 04340125
The notes on pages 44 to 50 form an integral part of these financial statements
P a g e | 42
Trafalgar Property Group Plc
COMPANY STATEMENT OF CHANGES IN EQUITY
31 March 2021
Share Capital
Share
Premium
Loan
Note
Equity
Reserve
Retained
Total Equity
profits/
(losses)
£
£
£
£
£
At 1 April 2019
2,570,567
2,510,462
- 5,783,356
702,327
Loss for the year
Total comprehensive
income for the year
Issue of shares
62,500
187,500
Share issue costs
(37,100)
(135,165)
(135,165)
(135,165)
(135,165)
250,000
(37,100)
At 31 March 2020
2,633,067
2,660,862
-
(5,918,521)
(624,592)
At 1 April 2020
2,633,067
2,660,862
-
(5,918,521)
(624,592)
Loss for the year
Total comprehensive
income for the year
Loan note equity
reserve
Issue of shares
93,750
656,250
Share issue costs
(66,863)
(742,887)
(742,887)
(742,887)
(742,887)
104,132
104,132
750,000
(66,863)
At 31 March 2021
2,726,817
3,250,249
104,132
(6,661,408)
(580,210)
Further details of share issues in the year are shown in note 12 to the company accounts.
The notes on pages 44 to 50 form an integral part of these financial statements.
P a g e | 43
Trafalgar Property Group Plc
NOTES TO THE COMPANY FINANCIAL STATEMENTS
for the year ended 31 March 2021
1 GENERAL INFORMATION
Nature of operations
Trafalgar Property Group Plc (“the Company”) is the UK holding company of a group of companies which are
engaged in property development. The Company is registered in England and Wales. Its registered office and
principal place of business is Chequers Barn, Bough Beech, Edenbridge, Kent TN8 7PD.
2 BASIS OF PREPARATION
The financial statements have been prepared under the historical cost convention and in accordance with
applicable United Kingdom law, FRS 102 and accounting standards. The principal accounting policies are
described below. They have all been applied consistently throughout the year and preceding year.
The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and
has not presented its own Statement of Comprehensive Income to these financial statements.
The Company has taken advantage of the disclosure exemption from the requirements of section 7 Statement of
Cashflow, as permitted by the FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of
Ireland”.
3 SIGNIFICANT ACCOUNTING POLICIES
(a) GOING CONCERN
The Directors have reviewed forecasts and budgets for the coming year, which have been drawn up with
appropriate regard for the current economic environment and the particular circumstances in which the Company
operates. These were prepared with reference to historical and current industry knowledge, taking into account
future strategy of the Company and wider Group.
The existing operations have been generating funds to meet short-term operating cash requirements. As a result
of these considerations, at the time of approving the financial statements, the Directors consider that the
Company and the Group have sufficient resources to continue in operational existence for the foreseeable future.
It is appropriate to adopt the going concern basis in the preparation of the financial statements.
As with all business forecasts, the Directors’ statement cannot guarantee that the going concern basis will remain
appropriate given the inherent uncertainty about the future events.
(b) INVESTMENTS
Investments held as fixed assets are stated at cost less provision for impairment.
(c) TAXATION
Current tax, including UK corporation tax and foreign tax, is provided at amounts expected to be paid (or
recovered) using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date.
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the
balance sheet date where transactions or events that result in an obligation to pay more tax in the future or a
right to pay less tax in the future have occurred at the balance sheet date. Timing differences are differences
between the company's taxable profits and its results as stated in the financial statements that arise from the
inclusion of gains and losses in tax assessments in years different from those in which they are recognised in
the financial statements.
A deferred tax asset is regarded as recoverable and therefore recognised only when, on the basis of all available
evidence, it can be regarded as more likely than not that there will be suitable taxable profits from which the
future reversal of the underlying timing differences can be deducted.
(d) FINANCIAL INSTRUMENTS
Financial assets and liabilities are recognised in the statements of financial position when the Company has
become a party to the contractual provisions of the instruments.
P a g e | 44
Trafalgar Property Group Plc
NOTES TO THE COMPANY FINANCIAL STATEMENTS
for the year ended 31 March 2021
The Company’s financial assets and liabilities are initially measured at fair value plus any directly attributable
transaction costs. The carrying value of the Company’s financial assets, primarily cash and bank balances, and
liabilities, primarily the Company’s payables and other accrued expenses, approximate to their fair values.
(i) Financial assets
On initial recognition, financial assets are classified as either financial assets at fair value through profit or loss,
held-to-maturity investments, loans and receivables financial assets, or available-for-sale financial assets, as
appropriate.
Trade and other receivables
Trade and other receivables (including deposits and prepayments) that have fixed or determinable payments that
are not quoted in an active market are classified as other receivables, deposits, and prepayments. Other
receivables, deposits, and prepayments are measured at amortised cost using the effective interest method, less
any impairment loss. Interest income is recognised by applying the effective interest rate, except for short-term
receivables when the recognition of interest would be immaterial.
(ii) Financial liabilities and equity instruments
Financial liabilities are classified as liabilities or equity in accordance with the substance of the contractual
arrangement.
Financial liabilities
Financial liabilities comprise long-term borrowings, short-term borrowings, trade and other payables and
accruals, measured at amortised cost using the effective interest method.
The effective interest method is a method of calculating the amortised cost of a financial liability and of
allocating interest income over the relevant period. The effective interest rate is the rate that exactly discounts
estimated future cash payments (including all fees on points paid or received that form an integral part of the
effective interest rate, transaction costs and other premiums or discounts) through the expected life of the
financial liability, or, where appropriate, a shorter period to the net carrying amount on initial recognition.
Equity instruments
An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all
its liabilities. Equity instruments issued by the Company are recognised at the proceeds received, net of direct
issue costs.
4
CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION
UNCERTAINTY
In the application of the Company’s accounting policies, which are described in note 3, the Directors are
required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that
are not apparent from other sources. The estimates and assumptions are based on historical experience and other
factors, including expectations of future events that are believed to be reasonable under the circumstances.
Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an on-going basis. Revisions to accounting estimates
are recognised in the period in which the estimate is revised if the revision affects only that period or in the
period of the revision and future periods if the revision affects both current and future periods.
The following are the key assumptions concerning the future and other key sources of estimation uncertainty at
the statement of financial position date that have a significant risk of causing a significant adjustment to the
carrying amounts of assets and liabilities in the financial statements:
P a g e | 45
Trafalgar Property Group Plc
NOTES TO THE COMPANY FINANCIAL STATEMENTS
for the year ended 31 March 2021
Carrying value of investments in subsidiaries and intercompany
Management’s assessment for impairment of investment in subsidiaries is based on the estimation of value in use
of the subsidiary by forecasting the expected future cash flows expected on each development project. The value
of the investment in subsidiaries is based on the subsidiaries being able to realise their cash flow projections.
Recognition of deferred tax assets
The recognition of deferred tax assets is based upon whether it is more likely than not that sufficient and suitable
taxable profits will be available in the future against which the reversal of temporary differences can be
deducted. To determine the future taxable profits, reference is made to the latest available profit forecasts.
Where the temporary differences are related to losses, relevant tax law is considered to determine the availability
of the losses to offset against the future taxable profits.
5 LOSS FOR FINANCIAL PERIOD
The Company has taken advantage of section 408 of the Companies Act 2006 and, consequently, a profit and
loss account for the Company alone has not been presented. The Company’s loss for the financial period was
£742,887 (2020: Loss £135,165). The Company’s loss for the financial year has been arrived at after charging
auditor’s remuneration payable to MHA MacIntyre Hudson for audit services to the Company of £10,000 (2020:
£10,000).
6 EMPLOYEES AND DIRECTORS' REMUNERATION
Directors’ fees
Social security costs
Management fees
The average number of employees of the Company during the year was:
Directors and management
2021
£
97,000
10,938
9,998
117,936
2020
£
15,000
879
4,994
20,873
2021
Number
2020
Number
3
3
There are no retirement benefits accruing to any of the Directors.
£ 9,998 (2020: £4,994) was paid to Mr Norman Lott for his professional services.
Additional directors remuneration of £ 45,000 (2020: £45,000) was paid to a director through subsidiary entities.
P a g e | 46
Trafalgar Property Group Plc
NOTES TO THE COMPANY FINANCIAL STATEMENTS
for the year ended 31 March 2021
7 INVESTMENTS
The Company owns the following undertakings, all of which are incorporated in the United Kingdom and have
their registered offices at Chequers Barn, Chequers Hill, Bough Beech, Edenbridge, Kent, TN8 7PD.
Held directly
held
Class of shares
% Shareholding
Principal Activity
Trafalgar New Homes
Limited
Trafalgar Retirement +
Limited
Ordinary shares
100%
Residential property developers
Ordinary shares
100%
Residential property & assisted
living scheme
Selmat Limited
Ordinary shares
100%
Residential property renting
Held indirectly through Trafalgar New Homes Limited
Combe Bank Homes
(Oakhurst) Limited
Ordinary shares 100% Residential property developers
Held indirectly through Trafalgar Retirement + Limited
Randell House Limited Ordinary shares 100% Assisted living developers
(dissolved 22 September
2020)
Controlled via Deed of Trust
Combe House (Borough
Green) Limited
Ordinary shares 100% Residential property developers
P a g e | 47
Trafalgar Property Group Plc
NOTES TO THE COMPANY FINANCIAL STATEMENTS
for the year ended 31 March 2021
8 DEBTORS
Amounts owed by group undertakings
Other debtors
Other taxes and social security
9 CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
Trade creditors
Taxation and social security
Other creditors
Amounts owed to group undertakings
10 BORROWINGS
2021
£
-
16,637
5,522
22,159
2020
£
343,068
1,822
5,244
350,134
2021
£
2020
Restated £
21,713
5,313
25,636
600,000
36,860
1,323
30,300
804,781
652,662 873,264
The Borrowings balance in both 2021 and 2020 relates to Director’s loans. These balances in both 2021 and
2020 are due in more than one year. The balance for 2020 has been restated as it was incorrectly shown as due
within one year. This restatement has no impact on the financial performance of the Company and is purely a
reclassification between being due in less than one year to more than one year.
11 FINANCIAL INSTRUMENTS
Financial assets
Financial assets measured at amortised cost:
11 FINANCIAL INSTRUMENTS
Amounts owed by group undertakings and other debtors
2021
£
£
16,637
2020
£
344,890
Financial liabilities
Financial liabilities measured at amortised cost
681,275
976,941
2021
Financial liabilities include, trade creditors, other creditors and amounts due to group undertakings.
12 SHARE CAPITAL
Issued, allotted and paid share capital
2020
Ordinary shares
Ordinary shares of 0.01p (2020: 0.1p) in issue
Ordinary shares of 0.01p (2020: 0.1p) issued in year
Total ordinary shares of 0.01p (2020: 0.1p) in issue
Total ordinary shares of 0.1p in issue following
consolidation
Deferred shares
Deferred shares of 0.9p in issue
Deferred shares of 0.9p arising in year from
reorganisation
Total Deferred shares of 0.9p in issue
2021
2020
Number
Number
487,690,380 425,190,380
937,500,000
62,500,000
1,425,190,380 487,690,380
142,519,038 -
238,375,190 238,375,190
-
48,769,038
287,144,228
238,375,190
P a g e | 48
Trafalgar Property Group Plc
NOTES TO THE COMPANY FINANCIAL STATEMENTS
for the year ended 31 March 2021
Issued allotted and paid
Ordinary shares of 0.01p (2020: 0.1p) in issue
Ordinary shares of 0.01p (2020: 0.1p) issued in year
Total Ordinary shares of 0.1p in issue following
Re-organisation
Deferred shares of 0.9p in issue
Deferred shares of 0.9p arising in year from
Re-organisation
reorganization
2021
£
48,769
93,750
142,519
2020
£
425,190
62,500
487,690
2,145,377
438,921
2,584,298
2,145,377
-
2,145,377
2,726,817
2,633,067
On 13 July 2020 the Company undertook a sub-division of its ordinary shares, which sub divided the 487,690,380 0.1p
ordinary shares of 0.1p each into 487,690,380 ordinary shares of 0.01p each and 487,690,380 0.09p deferred shares of
0.09p each. The 0.09p deferred shares of 0.09p each were consolidated into deferred shares of 0.9p each ranking pari
passu as one class with the existing deferred shares of 0.9p each.
On 14 July 2020, 937,500,000 ordinary shares of 0.01p each were issued under a placing at 0.08p each (at a premium of
0.07p per share) to raise £ 750,000 before costs of £ 66,863.
In addition, on 14 July 2020 warrants to subscribe for ordinary shares of 0.01p were granted as follows:
(a) Subscribers to the placing were granted warrants to subscribe for up to 937,500,000 shares for a period of two years,
exercisable at 0.2p per share;
(b) Peterhouse Capital Limited was granted warrants to subscribe for shares equivalent up to 3% of the issued ordinary
share capital from time to time, exercisable for a period of two years, at 0.08p per share.
Following the consolidation of ordinary shares in December 2020, the warrants have been adjusted and comprise placee
warrants to subscribe for up to 93,750,000 ordinary shares of 0.1p at 2p per share, and the warrants held by Peterhouse
Capital Limited are exercisable at 0.8p per share.
In relation to the granting of these warrants to Peterhouse Capital Limited, these fall under the requirements of IAS 39
Financial Instruments and as such are accounted for at fair value through profit or loss. At the grant date of these
warrants these are valued using a Black Scholes model to determine the intrinsic value of the warrant and a liability is
recognized for this amount with a corresponding expense through the income statement. The Directors’ have concluded
that the intrinsic value of the warrant as at 31 March 2021 is not material to the results and subsequent movements in the
share price have decreased this value further. As such no accounting entries have been made to these results.
Further on 14 July 2020 £ 600,000 of convertible loan notes were issued to Mr C C Johnson as part of arrangements to
reorganise loans between him and the Group. The notes are repayable on 31 July 2022 and are convertible at any time
into 300,000,000 ordinary shares of 0.01p at 0.2p per share. On conversion, warrants to subscribe for up to 300,000,000
ordinary shares will be granted to Mr C C Johnson exercisable for a period of two years from the date of grant at 0.2p
per share. Following the consolidation of ordinary shares in December 2020, the loan notes have been adjusted and are
convertible into 30,000,000 ordinary shares of 0.1p at 2p per share, with warrants to be granted to subscribe for up to
30,000,000 ordinary shares of 0.1p each at 2p per share, with warrants to be granted to subscribe for up to 30,000,000
ordinary shares of 0.1p each at 2p per share.
The convertible loan notes have been accounted for as having both a debt and an equity element. This results in the
creation of a loan note equity reserve at the point of issue. This loan note equity reserve is the difference between the
loan note value received by the company of £ 600,000 and the fair value of a debt only instrument with a 10% imputed
interest rate and a final settlement figure of £ 600,000 in July 2022. This 10% imputed interest rate is managements’
best estimate as to the interest rate that would be expected from the market for an unsecured loan of £ 600,000 without a
conversion element.
P a g e | 49
Trafalgar Property Group Plc
NOTES TO THE COMPANY FINANCIAL STATEMENTS
for the year ended 31 March 2021
Ordinary shares entitle the holder to receive notice of and to attend or vote at any general meeting of the Company or to
receive dividends or other distributions.
Deferred shares do not entitle the holder to receive notice of and to attend or vote at any general meeting of the
Company or to receive dividends or other distributions. Upon winding up or dissolution of the Company the holders of
deferred shares shall be entitled to receive an amount equal to the nominal amount paid up thereon, but only after holders
of ordinary shares have received £ 100,000 per ordinary share. Holders of deferred shares are not entitled to any further
rights of participation in the assets of the Company. The Company has the right to purchase the deferred shares in issue
at any time for no consideration.
On 29 December 2020 for every ten of the 1,425,190,380 ordinary shares of 0.01p then in issue, were consolidated into
one ordinary share of 0.1p resulting in there being 142,519,038 ordinary shares of 0.1p in issue.
13 INTERCOMPANY TRANSACTIONS
The company has taken advantage of the exemption conferred by FRS102 Section 33 “Related Party disclosures” not to
disclose transactions undertaken with other wholly owned members of the Group and transactions with directors.
14 POST BALANCE SHEET EVENTS
There are no events to report.
P a g e |50
TRAFALGAR PROPERTY GROUP PLC
(Registered in England No. 04340125)
NOTICE OF ANNUAL GENERAL MEETING
Explanation of resolutions at the Annual General Meeting
Information relating to resolutions to be proposed at the Annual General Meeting is set out below. The notice of
AGM is set out on page 52
Business at the AGM
The following resolutions will be proposed at the AGM:
(a) Resolution 1: to approve the annual report and accounts. The Directors are required to lay before
the Company at the AGM the accounts of the Company for the financial year ended 31 March 2021 ,
the report of the Directors and the report of the Company's auditors on those accounts.
(b) Resolution 2: to approve the re-appointment of MHA MacIntyre Hudson as auditors of the
Company. The Company is required to appoint auditors at each general meeting at which accounts
are laid, to hold office until the next such meeting.
(c) Resolution 3: to approve the remuneration of the auditors for the next year.
(d) Resolution 4: to re-appoint Gary Thorneycroft as a Director; Gary was appointed during the financial
year, and is required to be re-appointed at the first Annual General Meeting following his
appointment.
(e) Resolution 5 : to re-appoint Paul Treadaway as a Director; Paul is retiring by rotation and
submitting himself for re-election.
(f) Resolutions 6 and 7: to approve the renewal of general authorities to allot shares, which expire at
the AGM, for the purpose of (i) granting the Directors general authority to allot up to a maximum
nominal amount of £140,000, representing approximately 98% of the current issued ordinary share
capital; and (ii) disapplying pre-emption rights in connection with the allotment of up to a maximum
nominal amount of £140,000, representing approximately 98% of the current issued ordinary share
capital.
Attendance at the AGM
There are no longer any Covid-19 related legal prohibitions on attending the meeting in person. However,
in light of the continuing impact of Covid-19, current government guidance, and recognising that some
members and proxies may still be reluctant to attend in person, (i) the vote on each of the resolutions put
to the meeting will be taken on a poll; and (ii) shareholders are strongly advised to appoint the chairman
of the meeting as their proxy.
Any shareholder who wishes to raise a question is asked to contact the Company on 01732 700000.
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TRAFALGAR PROPERTY GROUP PLC
(Registered in England No. 04340125)
NOTICE OF ANNUAL GENERAL MEETING
NOTICE IS HEREBY GIVEN that the 2021 Annual General Meeting of the Company will be held at the
Company’s offices at [Chequers Barn, Bough Beech, Edenbridge, Kent TN8 7PD] at 11.00 a.m. on 30th
September 2021, for the following purposes:
To consider and, if thought fit, to pass resolutions 1 to 5 as ordinary resolutions:
RESOLUTIONS
1 To receive and adopt the directors’ report, the auditor’s report and the Company’s accounts for the
year ended 31 March 2021.
2 To re-appoint MHA MacIntyre Hudson as auditor in accordance with section 489 of the Companies
Act 2006, to hold office until the conclusion of the Annual General Meeting of the Company in
2022.
3 To authorise the Directors to determine the remuneration of the auditor.
4 To re-appoint Gary Thorneycroft as a Director of the Company.
5 To re-appoint Paul Treadaway as a Director of the Company.
Special business
To consider and, if thought fit, to pass resolution 6 as an ordinary resolution, and resolution 7 as a special resolution:
6
7
THAT, in addition to all existing authorities conferred on the directors to allot shares or to grant rights to
subscribe for or to convert any securities into shares, the directors be authorised generally and unconditionally
pursuant to Section 551 of the Companies Act 2006 as amended to exercise all the powers of the Company to
allot shares and/or rights to subscribe for or to convert any security into shares, provided that the authority
conferred by this resolution shall be limited to the allotment of shares and/or rights to subscribe or convert any
security into shares of the Company up to an aggregate nominal amount of £140,000 such authority (unless
previously revoked, varied or renewed) to expire on the conclusion of the Annual General Meeting of the
Company to be held in 2022 or, if earlier, 15 months after the date on which this resolution has been passed,
provided that the Company may, before such expiry, make an offer, agreement or other arrangement which would
or might require shares and/or rights to subscribe for or to convert any security into shares to be allotted after such
expiry and the directors may allot such shares and/or rights to subscribe for or to convert any security into shares
in pursuance of such offer, agreement or other arrangement as if the authority conferred hereby had not expired.
THAT, in addition to all existing authorities conferred on the directors to allot shares or to grant rights to
subscribe for or to convert any securities into shares, the directors be and are hereby generally empowered to allot
equity securities (within the meaning of Section 560 of the Companies Act 2006) pursuant to the general authority
conferred by resolution 6 above for cash or by way of sale of treasury shares as if Section 561 of the Companies
Act 2006 or any pre-emption provisions contained in the Company’s articles of association did not apply to any
such allotment, provided that the power conferred by this resolution shall be limited to
(i)
any allotment of equity securities where such securities have been offered (whether by way of rights
issue, open offer or otherwise) to holders of equity securities in proportion (as nearly as may be
practicable) to their then holdings of such securities, but subject to the directors having the right to make
such exclusions or other arrangements in connection with such offer as they deem necessary or expedient
to deal with fractional entitlements or legal or practical problems arising in, or pursuant to, the laws of
any territory or the requirements of any regulatory body or stock exchange in any territory or otherwise
howsoever;
(ii)
the allotment (otherwise than pursuant to sub-paragraph (i) above) of equity securities up to an aggregate
nominal value of £140,000,
such authority and power (unless previously revoked, varied or renewed) to expire on the earlier to occur of 15 months
after the passing of this resolution or the conclusion of the Annual General Meeting of the Company to be held in 2022,
provided that the Company may prior to such expiry make any offer, agreement or other arrangement which would or
might require equity securities to be allotted after such expiry and the directors may allot equity securities pursuant to any
such offer, agreement or other arrangement as if the power hereby conferred had not expired.
Dated: 6 September 2021
Registered office:
Chequers Barn
Chequers Hill
Bough Beech
Edenbridge
Kent TN8 7PD
By order of the Board
N W Narraway
Secretary
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Notes:
1.
2.
3.
4.
5.
6.
7.
8.
9.
There are no longer any Covid-19 related legal prohibitions on attending the meeting in
person. However, in light of the continuing impact of Covid-19, current government guidance,
and recognising that some members and proxies may still be reluctant to attend in person, (i)
the vote on each of the resolutions put to the meeting will be taken on a poll; and (ii)
shareholders are strongly advised to appoint the chairman of the meeting as their proxy.
As a member of the Company, you are entitled to appoint a proxy to exercise all or any of your
rights to attend, speak and vote at the Meeting and you should have received a proxy form with this
notice of meeting. You can only appoint a proxy using the procedures set out in these notes and the
notes to the proxy form.
A proxy does not need to be a member of the Company but must attend the Meeting to represent
you. Details of how to appoint the Chairman of the Meeting or another person as your proxy using
the proxy form are set out in the notes to the proxy form. As all resolutions will be taken on a
poll, shareholders are strongly advised to appoint the chairman of the meeting as their proxy.
You may appoint more than one proxy provided each proxy is appointed to exercise rights attached
to different shares. You may not appoint more than one proxy to exercise rights attached to any one
share. To appoint more than one proxy, you may photocopy the enclosed proxy form.
If you do not give your proxy an indication of how to vote on any resolution, your proxy will vote or
abstain from voting at his or her discretion. Your proxy will vote (or abstain from voting) as he or
she thinks fit in relation to any other matter which is put before the Meeting.
The notes to the proxy form explain how to direct your proxy how to vote on each resolution or
withhold their vote.
To appoint a proxy using the proxy form, the form must be:
(a) completed and signed;
(b) sent or delivered to the Company’s Registrars, Neville Registrars Limited, Neville
House, Steelpark Road, Halesowen B62 8HD; and
(c) received by no later than 11.00a.m. on 28 September 2021.
Any power of attorney or any other authority under which the proxy form is signed (or a duly
certified copy of such power or authority) must be included with the proxy form.
To change your proxy appointment, simply submit a new proxy appointment using the methods set
out above. Note that the cut-off time for receipt of proxy appointments (see above) also apply in
relation to amended instructions; any amended proxy appointment received after the relevant cut-off
time will be disregarded.
Where you have appointed a proxy using the hard-copy proxy form and would like to change the
instructions using another hard-copy proxy form, you may photocopy the enclosed proxy form.
If you submit more than one valid proxy appointment, the appointment received last before the
latest time for the receipt of proxies will take precedence.
In order to revoke a proxy appointment you will need to inform the Company by sending a signed
hard copy notice clearly stating that you revoke your proxy appointment to Neville Registrars
Limited, Neville House, Steelpark Road, Halesowen, B62 8HD. Any power of attorney or any other
authority under which the revocation notice is signed (or a duly certified copy of such power or
authority) must be included with the revocation notice.
The revocation notice must be received by no later than 11.00 a.m. on 28 September 2021.
If you attempt to revoke your proxy appointment but the revocation is received after the time
specified then, subject to the paragraph directly below, your proxy appointment will remain valid.
Appointment of a proxy does not preclude you from attending the Meeting and voting in person.
10.
Pursuant to Regulation 41 of the Uncertificated Securities Regulations 2001, only those members
registered in the register of members of the Company as at 6.00 p.m. on 28 September 2021 shall
be entitled to attend and vote at this Meeting in respect of the number of shares registered in their
name at that time. Changes to entries on the relevant register of securities after such time shall be
disregarded in determining the rights of any person to attend or vote at this Meeting.
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