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VARIOUS EATERIES IS A HOSPITALIT Y
GROUP PASSIONATE ABOUT CREATING
UNIQUE AND IMMERSIVE
EXPERIENCES FOR MODERN
CONSUMERS .
WITH BOTH COPPA CLUB AND TAVOLINO,
WE ARE FOCUSED ON CREATING
DESTINATIONS THAT REFLEC T THE WAY PEOPLE
WANT TO SOCIALISE , WORK AND REL A X .
HIGHLIGHTS
• Raised £25m in successful aiM listing
• Development and launch of new italian
• Significant reshaping of the Group in
brand concept tavolino
preparation for admission
• acquired two hotels at coppa club sites
• Strengthened management team with
with associated event operations
senior appointments
• Group now ideally positioned for post-
covid-19 expansion
STRATEGIC REPORT
04 at a Glance
05 our Brands
06 chairman’s & chief
Executive’s Statement
10 Market overview
& the opportunity
12 Business Model
14 Financial Review
16 principal Risks &
uncertainties
17 Directors’ Duties
– S.172 Statement
GOVERNANCE
20 Board of Directors
22 Executive chairman’s
FINANCIAL STATEMENTS
36 consolidated Statement
of comprehensive income
Statement on corporate
Governance
37 consolidated Statement
of Financial position
25 Directors’ Report
28
independent auditor’s
Report to the Members
of Various Eateries pLc
38 parent company
Balance Sheet
39 consolidated Statement
of changes in Equity
40 company Statement of
changes in Equity
41 consolidated Statement
of cash Flows
42 notes to the Financial
Statements
For the latest investor information see our website at:
https://www.variouseateries.co.uk
StR atEGic
REpoRt
StR atEGic
REpoRt
04 At a Glance
05 Our Brands
06 Chairman’s & Chief Executive’s Statement
10 Market Overview & the Opportunity
12 Business Model
14 Financial Review
16 Principal Risks & Uncertainties
17 Directors’ Duties – S.172 Statement
AT A GLANCE
tHE VaRiouS EatERiES GRoup coMpRiSES
tHE coppa cLuB anD taVoLino BRanDS,
WHicH cuRREntLY opERatE acRoSS
11 uK LocationS.
our Directors are responsible for developing some of the uK’s
most successful hospitality groups, and we believe that the
current market conditions present the perfect opportunity
to expand both coppa club and tavolino across the uK.
OUR PURPOSE
Great people delivering unique experiences through
continuous innovation.
OUR CULTURE
the success of our business is dependent on the culture we
foster and the way we think, behave and act towards our key
stakeholders. We want to work with people who share the same
passion that we have for our customers and our brands, and with
people looking to work hard, develop with us and become part
of the Various Eateries team.
OUR VALUES AND BEHAVIOURS
We are welcoming – inclusive and positive; open minded;
nothing is too much trouble
We take pride – Don’t compromise; challenge yourself
We are a community – Be part of something; We look out for
each other; We care about our community
OUR HISTORY
Various Eateries was founded by Hugh osmond – owner of the
Strada business – in 2014. the first coppa club opened in
Sonning-on-thames in 2015, and five more coppa clubs had
been launched by 2019. andy Bassadone invested in the Group
in 2019 with a vision to redefine the italian dining sector with our
second key brand tavolino, which opened its first location in
tower Bridge in 2020.
COPPA
TAVOLINO
STRADA
31 BELOW
4STRATEGIC REPORT VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 OUR BRANDS
COPPA CLUB
coppa club is a multi-use, all-day concept that combines
restaurant, terrace, café, lounge, bar and work spaces.
coppa club seeks to provide a clubhouse that consumers
can identify as their own, providing all the associated facilities
with no annual membership fees.
coppa club’s all-day menu is designed to address consumers’
needs at any time of the day or week, encouraging them to
return regularly.
the Group currently has seven coppa club locations, the majority
of which are located outside of London. However, its three
flexible format options allow it to be applied to central London,
town-centre locations and existing hotel sites with ease.
the three formats are as follows:
• Full-Service Clubhouse
(the Great House at Sonning and the Swan at Streatley)
• Club & Brasserie
(tower Bridge coppa club and coppa club cobham)
• High Street Hubs
(coppa club Henley, Maidenhead and Brighton)
TAVOLINO
tavolino (meaning “small table” in italian) is a neighbourhood
italian bar and restaurant offering simple, high-quality italian
food. it differentiates itself by using premium ingredients, with
dishes accessibly priced but not in a way that compromises
the quality.
our chefs are focused on creating and cooking authentic italian
dishes, made in traditional ways. they have developed bespoke,
quality products that are scalable and can be efficiently,
consistently and profitably rolled out.
the Group currently has one tavolino location, in London.
tavolino is designed to operate in two formats. its primary
format will be restaurant sites that provide an extensive italian
brasserie menu, however, there is also an intention to create
smaller pasta-only sites.
THE SUCCESS OF OUR BUSINESS
IS DEPENDENT ON THE CULTURE
WE FOSTER AND THE WAY WE THINK,
BEHAVE AND ACT.
OUR OTHER ASSETS
STRADA
Strada is an established business and remains a well-known
brand. the Group owns and controls the last two remaining sites,
which are located in central London. We intend to convert both
sites to the tavolino concept in the future.
31 BELOW
31 Below is a neighbourhood café/bar with an all-day menu, full
service bar, lounge area and workspace. the Group currently
has one 31 Below location, located on Marylebone High Street.
5STRATEGIC REPORT VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 CHAIRMAN’S &
CHIEF EXECUTIVE'S STATEMENT
VaRiouS EatERiES iS a WELL-FunDED opERatoR,
WitH StRonG anD FRESH BRanDS anD an
EXpERiEncED ManaGEMEnt tEaM. BotH
coppa cLuB anD taVoLino aRE iMMEDiatELY REaDY
to ScaLE up GiVEn tHE EconoMic cHaLLEnGES
FacinG tHE SEctoR.
in the run up to our initial public offering (‘ipo’) on the aiM Market
of the London Stock Exchange, which took place on 25 September
2020, we spoke to investors of the far-reaching consequences we
expected covid-19 to have on the hospitality sector, and the vast
opportunities it would create for a well-funded group with the right
management team, modern formats built for the post-covid-19
environment, and a growth strategy fit for purpose.
While the exact timing and extent of restrictions has been difficult
to predict, overall the pandemic and its effects on the hospitality
industry continue to pan out much as we expected. Just 70% of
Britain’s licensed premises were trading by the end of october
20201. over 650,000 hospitality jobs were lost in 20202, and
with more than a million people in the food services and
accommodation industry furloughed as of 31 December 20203, this
figure is likely to grow dramatically in 2021. uK Hospitality has
highlighted that four in ten businesses in the sector have stated
that they would fail by mid-2021, with only one in five having
adequate capital to survive beyond February 2021 under present
levels of support4.
as long-standing members of this industry, these statistics make
difficult reading, however they do validate our approach and only
make us more committed to our plans to rebuild; to acquire new
sites, create jobs for as many people as possible, and to establish
a new breed of venue that customers can enjoy in comfort and
in safety.
in the period to 27 September 2020 (‘FY20’), we went through a
comprehensive process of overhauling the business in preparation
for this moment. We built an incredible team – one of the most
experienced in our industry – rationalised and improved our estate
leaving us with only high-quality sites ready for growth, and
developed new brands appropriate for the evolving needs of
modern consumers.
With all of the transformative work undertaken in the year,
together with our new listed status and the associated raise of
£25m completed in September, we are confident we have the
experience and resources to achieve our ambitions.
Andy Bassadone
Executive chairman
Yishay Malkov
chief Executive
officer
6STRATEGIC REPORT VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 IN PERIODS OUTSIDE OF LOCKDOWN,
TRADING WAS STRONG, ESPECIALLY OUTSIDE
OF LONDON WHERE THREE SITES ACHIEVED
RECORD WEEKS IN THE PERIOD.
OUR STRATEGY
our strategy is based on the Board’s belief that the current
environment presents an unprecedented opportunity for us,
as a well-funded operator with strong and fresh brands and an
experienced management team, to create a major leisure group
post the covid-19 lockdown. initially this will be based on our
two core brands of coppa club and tavolino.
coppa club is a multi-use, all-day concept that combines
restaurant, terrace, café, lounge, bar and remote working spaces
under one roof. tavolino aims to address a gap in the market for
high-quality italian food at mid-market prices.
Both coppa club and tavolino are immediately ready to scale up
given the economic challenges facing the sector. this is
particularly as a consequence of covid-19, which has led to a
significant reduction in competition, premium site availability
the likes of which the industry has never seen, and an increased
availability of great, hard-working people.
the impact of covid-19, combined with the experience of our
management team, represents an unprecedented opportunity to
build a major hospitality group, post covid-19. accordingly, using
the funds raised in the recent placing, we intend to invest in the
expansion of the coppa club and tavolino brands by targeting
distressed sites in prime locations, and we also intend to identify
potential, complementary, bolt-on acquisitions of other restaurant
brands to accelerate growth across the Group.
TRADING & COVID-19 IMPACT
While the two new coppa club sites which were opened in the
52 weeks to 29 September 2019 (‘FY19’) delivered additional
revenues in FY20, due to the reshaping of the business (including
the planned closure and disposal of six sites in FY19), the severe
restrictions placed on trading in response to covid-19, and a
period where our restaurant in tower Bridge was closed for
refurbishment to become the first tavolino, overall revenue for
FY20 was down 36% to £16.4m from £25.6m.
However, in periods outside of lockdown, trading was strong,
especially in our new openings. the summer trade in particular,
post July reopening from lockdown, saw some encouraging
results for the future whilst the overall liquidity of the business
remains strong.
a timeline of the various restrictions and the associated impact
on trading is set out in the Financial Review.
1 november edition of cGa and alixpartners’ Market Recovery Monitor.
2 according to analysis by software provider Fourth.
3 according to HMRc coronavirus statistics.
4 Stated as part of its evidence to the treasury Select committee inquiry
into the Economic impact of coronavirus.
7STRATEGIC REPORT VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 CHAIRMAN’S &
CHIEF EXECUTIVE'S STATEMENT
continuED
DuRinG tHE pERioD, WE FocuSED on MaKinG aLL
ouR REStauRantS tHE VERY BESt tHEY can BE,
EnHancinG ouR MaRKEt-LEaDinG pRoDuct,
SERVicE anD EnViRonMEnt WHEREVER poSSiBLE.
DEVELOPING OUR ESTATE
During the reporting period we completed the reshaping of our
estate with the disposal of the remaining four discontinued sites
following the 11 made in FY19, as well as the acquisition of the next
coppa club in cobham. prior to ipo, we also acquired the Rare
Bird hotel and events businesses at coppa club Sonning and
Streatley. We brought these two sister operations into the Group in
order to enhance the clubhouse element of the coppa club brand
and improve profitability through sales and cost synergies.
FY20 saw the launch of the new tavolino brand, with the first
site opening in central London in July. Despite the significant
reduction in footfall caused by covid-19, the launch was a success
and customer feedback was strong, boding well for the future.
MicHELin recently said of the site: “pasta handmade on the
premises daily and classic italian dishes crafted using produce
imported from small italian suppliers are the draw here. these
are matched by stunning views over the thames towards
tower Bridge and the tower of London – making a table on
the terrace a must in summer”.
post period end, we opened our seventh coppa club site in
cobham, Surrey. the new site spans two floors and adopts
the larger club & Brasserie format. it includes a restaurant,
bar, lounge and rooftop terrace complete with the brand’s
signature igloos. in line with the existing estate, it provides a
“clubhouse” that consumers can identify as their own, without
annual membership fees but providing all the associated
facilities. the flexible format means consumers can use sites
for a range of activities from eating and drinking to socialising,
working or relaxing, making it fit for changing consumer tastes
in the 21st century.
as at 27 September 2020, the Group had 11 sites, all in prime
locations and without restrictive lease agreements. the sites
themselves are spacious and most have significant outdoor spaces.
coppa’s “igloo” concept has proven exceptionally popular, with all
igloos booked out solidly throughout the July to September 2020
reopening period.
IMPROVING OUR OFFERING
During the period, we focused on making all our restaurants the
very best they can be, enhancing our market-leading product,
service and environment wherever possible. the philosophy of the
Group is built around an obsession over quality, consistency and
high standards. to that end, we continue to review our own
8STRATEGIC REPORT VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 performance in a systematic and disciplined way using tools such
as the newly introduced customer feedback platform and will
continue to do so.
one product of this ongoing process was the introduction of a
revised and refined menu across the coppa club estate on
reopening in July, which had been trialled briefly in March. the
new menu brought a further improvement in quality, expanded
the price range and focused on the all-day club offer. not only was
this well received, it drove an improvement to margin.
in line with what modern consumers expect and demand, Various
Eateries is focused on building strong, authentic menus using
premium ingredients. one of our core differentiators is that the
chef Director and his team have a senior role within the Group.
they have developed bespoke, quality products that are scalable
and can be efficiently, consistently and profitably rolled out across
all new sites.
OUR PEOPLE
During the period industry veteran, andy Bassadone joined the
Board as Executive chairman and invested in the Group. the
management team was then further strengthened with senior
appointments including cEo Yishay Malkov and, post-period end,
property Director Raj Manek (a non-Board position).
Supporting our people throughout the impacts of covid-19 has
been incredibly important. Regular communication with our
furloughed staff through our intranet has been a key priority, as
has the introduction of several initiatives aimed at encouraging
engagement and protecting mental wellbeing such as fitness
clubs and interactive tutorials where team members volunteered
to host video calls to teach colleagues a new skill. our people are
the lifeblood of the businesses and on behalf of the Board we
would like to thank them for their efforts and patience through
what has been a very difficult time for them and their families.
MARKET DEVELOPMENTS
covid-19 has had a devastating impact on our industry and will
leave scars for many years to come. However, it is clear that the
demand for enjoyable leisure and hospitality experiences has not
waned. We believe there will be a strong bounce back once
restrictions are lifted and have already seen signs of it ourselves
when we were able to trade in the summer of 2020. Similarly, with
pent-up demand for holidaying likely to lead to an increase in
“staycations”, and a lengthy backlog of weddings and other
events, we expect to see trade in our hotel businesses accelerate
post covid-19.
it has been estimated that 50% of the uK workforce favours
working remotely for one to two days per week post lockdown,
and consumers now attach much greater importance to safety
when making choices. coppa club in particular is well placed to
take advantage of these and other changes in consumer
behaviour which have been accelerated by covid-19. the sites
are typically spacious, with large outdoor areas, and can be
used throughout the day for everything from working to social
gatherings and of course meals from breakfast through to
dinner. this is a key reason why we believe we will be successful
in the long term.
CURRENT TRADING AND OUTLOOK
the trading patterns we saw between July and September
continued through the weeks we were open in october, with
positive like-for-like performance at our sites outside of London
particularly encouraging. in the period since, we have been
focused on continuing to support our people while working hard
behind the scenes to prepare the Group to capitalise on the
wealth of opportunities that will be available once restrictions
are eased.
as recently communicated, while the business has been closed,
management has been exploring a number of desirable sites for
expansion across the uK. Given the lack of concrete guidance as to
when lockdown and other restrictions will be lifted, the Group had
so far chosen to hold off signing up to any new leases, but, with the
roadmap now laid out, expects to be able to do so in the near
future on terms that reflect the considerable and continuing fall in
retail property values.
the operating environment is likely to remain volatile for some
time, but with a diverse mix of restaurants and hotels designed
specifically to cater to the changes in the consumer landscape, a
clear strategy and a proven management team, we are excited by
what the future holds.
Andy Bassadone
Executive chairman
Yishay Malkov
chief Executive officer
SUPPORTING OUR PEOPLE THROUGHOUT
THE IMPACTS OF COVID-19 HAS BEEN
INCREDIBLY IMPORTANT.
9STRATEGIC REPORT VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 MARKET OVERVIEW
& THE OPPORTUNITY
VaRiouS EatERiES GRoup’S BuSinESS MoDEL anD
GRoWtH StRatEGY HaVE BEEn DEVELopED in
RESponSE to a cLEaR MaRKEt oppoRtunitY.
MARKET OVERVIEW
the uK restaurant sector has faced structural difficulties for a
significant period of time due to narrowing margins, increasing
fixed costs and an oversupply of restaurants offering similar, and
often outdated, experiences.
the negative economic impact following the uK’s 2016 Eu
membership referendum resulted in a further downturn of
consumer confidence and led to reduced footfall across the
country’s high streets. these conditions caused falling revenues
across the sector, which coincided with increasing levels of debt for
a number of restaurant brands, particularly those that had been
acquired by private equity groups. this put several high-profile
groups under substantial financial pressure, and these conditions
resulted in a significant number of closures throughout 2018
and 2019.
these challenging conditions were compounded by the covid-19
pandemic. a considerable number of restaurant groups have
closed sites and reduced their footprint throughout the uK this
year, and at least 16 high-profile restaurant groups also
commenced insolvency processes.
Many restaurant groups are struggling with weakened balance
sheets and outdated or underinvested brands. We expect that
there will be significant further closures in the near future, with
early estimates suggesting that as many as 4,000 restaurant sites
could close as a consequence of the pandemic.
COPPA CLUB WAS DESIGNED
SPECIFICALLY TO TAKE
ADVANTAGE OF CHANGES
IN CONSUMER BEHAVIOUR.
10STRATEGIC REPORT VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 THE OPPORTUNITY FOR VARIOUS EATERIES
though the market conditions within the uK restaurant sector
are undoubtedly challenging, we believe they provide an
unprecedented opportunity for a well-funded operator, with
strong and fresh brands and an experienced management
team, to create a major leisure group in the wake of the
pandemic. in particular:
• Site availability
With so many restaurants closing, leases in attractive
locations are becoming available on attractive terms.
• Acquisition opportunities
Strong liquidity and a wealth of experience mean we are
well placed to make selective and targeted acquisitions
of either high-quality individual sites or, if appropriate,
restaurant brands.
• Reduced competition
a significant number of branded chains have entered into an
administration process and/or are significantly reducing their
estate. Reduced competition, especially of italian mid-market
chains for example, provides a major opportunity for our new
and fresh concepts to grow market share rapidly.
• Availability of talent
Following the increased number of closures across the sector,
a much higher number of well-qualified people are available
for positions. the increased availability of talented General
Managers and Head chefs in particular will assist the
expansion of both of our brands.
• Changes in consumer behaviour
coppa club was designed specifically to take advantage of
changes in consumer behaviour, many of which have been
accelerated by covid-19. in response to short-term safety
concerns, our portfolio is well placed to provide guests with
social distancing, outdoor areas and sanitation. in the long
term, it has been estimated that 50% of the uK workforce
favours working remotely for one to two days per week after
the pandemic, which will benefit our local sites.
11STRATEGIC REPORT VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 BUSINESS MODEL
WE LEVERaGE ouR KEY StREnGtHS anD SouRcES
oF coMpEtitiVE aDVantaGE to DELiVER ouR
DiStinct cuStoMER pRopoSition.
THE LEADERSHIP TEAM HAVE
OPENED MORE THAN 400 NEW
SITES BETWEEN THEM.
WHAT WE DO
Various Eateries specialises in operating modern hospitality venues
for customers looking for high quality at reasonable prices. the core
restaurant proposition that sits at the heart of coppa club and
tavolino is supplemented by activity in providing café, lounge, bar
and work spaces under one roof (as well as bedrooms, event
spaces, gym and spa facilities in certain flagship locations) for
coppa club customers specifically.
the distinct features of the customer proposition of each
brand include:
• Coppa Club
– unique multi-use, all-day concept
– Flexible format options can be applied to a range
of convenient locations
– Menu designed to suit all occasions
– pricing strategy focused on providing high quality
at reasonable prices
– private dining, rooms and events available
at certain locations
• Tavolino
– High-quality italian food at mid-market prices
– Wide-ranging menu focused on authentic italian products,
made in traditional ways – providing a fresh alternative to
struggling mid-market italian chains
– Suitable for all major towns and cities including central
London and London suburbs
– Simple and smaller format option appropriate
for younger demographic
ACQUISITIONS
Roll-out of key brands
We have a site acquisition programme for scaling up our brands
and expanding our footprint across new locations. our extensive
experience in identifying these opportunities is supported by
our proven ability to successfully execute site acquisitions and
refurbishments on time and to budget. our brand roll-out activity
has been further enhanced with the appointment of our new
property Director.
Acquiring new brands
We carefully consider opportunities to acquire other brands and
businesses, focusing on the potential for selective and targeted
acquisitions to increase overall shareholder value.
12STRATEGIC REPORT VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 OUR KEY STRENGTHS
Entrepreneurial leadership with expert experience
We are led by entrepreneurs andy Bassadone and
Hugh osmond who bring extensive experience in
creating and growing some of the uK’s most successful
hospitality groups.
the leadership team have opened more than 400 new sites
between them and made significant returns for investors since
the mid-1990s.
An exceptional executive team
Led by cEo Yishay Malkov, the team has considerable sector
expertise and a proven track record of delivering growth
strategies for hospitality groups over many years. their
understanding of the market and strategic guidance will
ensure the successful roll-out of our key brands.
Established platform businesses
the Group has two established brands across 11 locations. these
sites, popular with local communities and with some strong
historical sales, are well suited to take advantage of the changes in
consumer behaviour post covid. the success of our existing sites
demonstrate that both brands are immediately ready to scale up.
Financial strength
the successful raise of £25m on the aiM Market of the London
Stock Exchange provides a strong financial base to fund growth
organically, and the potential for further investment.
Well-invested central infrastructure to support growth
Head office structure capable of supporting our growth plans as
well as established in-house support functions such as finance,
HR, marketing and procurement. as well as the ability to operate
the current business, we also have vast experience of executing
builds, new openings and acquisitions.
£25m
Successfully raised
on the AiM Market
13STRATEGIC REPORT VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 FINANCIAL REVIEW
FINANCIAL PERFORMANCE
the financial results for FY20 have been materially impacted by the following unusual factors:
• the comprehensive restructuring and refinancing of the Group ahead of the initial public offering (‘ipo’) in September 2020
• the costs of the ipo
•
• the impact of covid-19 resulting in zero revenue in lockdown periods and disruptions at other times
impairment charges driven by market conditions
the Group’s hotel and event operations at Sonning and Streatley were acquired during the final weeks of the financial period and had no
impact on the FY20 results.
overall Group Revenue was down by 36% (FY20: £16.5m, FY19: £25.6m), resulting in a trading EBitDa loss of £0.8m (FY19: £2.3m profit)
and a Loss before tax of £14.4m (FY19: £12.0m loss). the principles of merger accounting have been followed and so the results and
comparatives are those of the underlying group. the summarised results are:
Summary of financial performance for the 52 weeks ended 27 September 2020
Revenue
Loss before tax
net financing costs
Depreciation and impairment
Loss / (profit) on disposal of assets and leases
authorised Guarantee agreements provision
initial public offering costs
Restructuring costs
EBITDA before exceptional costs
pre-opening costs*
non-trading site costs*
Trading EBITDA
52 weeks
ended
27 September
2020
£ 000
52 weeks
ended
29 September
2019
£ 000
16,469
25,605
(14,442)
(11,975)
2,002
8,225
1,632
461
285
167
(1,670)
564
302
(804)
6,914
5,673
(117)
–
–
322
817
752
702
2,271
Pre-Covid
Despite the existing industry-wide challenges, trade was relatively strong up to the beginning of February 2020, with the coppa club
estate trading at positive LFLs. However, with the arrival of covid-19 in the uK, sales began to decline and on 20 March, the country went
into a full lockdown and all sites were forced to close.
During the first national lockdown
From the end of May (until the site fully reopened in July), coppa club Streatley was reopened to run a takeaway service. this proved a
popular initiative, generating significant sales and having a positive impact on the community, with the grounds of the adjacent hotel
providing local people with an expansive, safe and picturesque environment in which to enjoy the good weather.
Post-lockdown performance
the trade of the estate post lockdown, whilst varying from site to site, was far stronger than we had anticipated and ahead of the market.
From 4 July, when lockdown was officially lifted, the Group began a phased reopening of the estate, with 80% of its sites open and
trading by the end of July.
all the Group’s London sites were negatively impacted by the significantly reduced footfall as most of the uK transitioned to home
working and staying local. our sites outside London, however, were major beneficiaries of this trend.
* not audited
14STRATEGIC REPORT VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 IMPAIRMENTS
a detailed review of each individual site has resulted in an
impairment charge of £5.4m, split £3.6m against goodwill,
£0.1m against leasehold improvements and ppE and £1.6m against
right-of-use assets. Detail of the methodology is included in notes
14 and 15 on pages 51 to 54.
LOSS ON DISPOSAL OF ASSETS & LEASES
in FY20, the Group disposed of the remaining non-trading Strada
leases and associated assets.
IPO & RESTRUCTURING COSTS
these costs were incurred in the prior restructuring and execution
of the Group’s ipo. Further costs of £1.9m have been charged
directly to reserves as they relate to the raising of equity.
DIVIDEND
the Directors do not recommend the payment of a dividend
believing it more beneficial to use cash resources to invest in the
Group in line with our strategy.
CASHFLOW & BALANCE SHEET
as communicated above, the Group undertook significant actions
to mitigate the impact of the pandemic on its financial position.
During the period, the Group invested £5.1m in capital expenditure
in support of future growth.
in September, the Group undertook a financial restructuring and
following a successful ipo on the aiM market, raised net proceeds
of £23.2m. With an interim insurance payment of £2.5m also
received post period end, the liquidity of the Group remains strong
to continue to follow the expansion strategy.
KEY PERFORMANCE INDICATORS ('KPIs')
the Board reviews numerous indicators of performance on a
monthly basis. the two historically used are Revenue £16.5m
(FY19: £25.6m) and trading EBitDa (£0.8m) (FY19: £2.3m) with
both severely impacted by the conditions faced by the Group in
the period. With the debt restructure and successful flotation on
the aiM Market during the period, the net asset position of the
Group at the period end was £27.2m (FY19: net liabilities
(£6.4m)). Going forward, as the Group’s strategy evolves, further
Kpis will be used to measure the progress including new site
openings and Like-for-like sales growth.
Like-for-like sales growth
Coppa Club –
London (1 site)
Coppa Club –
Regional (5 sites)
Jul ‘20
aug ‘20
Sep ‘20 Jul-Sep ‘20
-35%
-27%
-26%
-28%
+6%
+32%
+22%
+24%
Whilst these results include Vat benefit, there were also limits on
social distancing and mixing households, the introduction of the
10pm curfew, the “Rule of 6” in September and reduced opening
hours in the mornings. Like-for-like sales generated from the
coppa club estate were up 0.8% despite all the restrictions that
were in place.
Encouragingly, three coppa clubs achieved record sales weeks
over the course of the summer, whilst the change in menu,
as well as increasing the product quality, lead to an improvement
to margin.
Late July also saw the launch of our new tavolino brand at
tower Bridge. Early indications were positive despite the lack
of tourism and local office traffic, giving encouragement
for future trading.
COVID-19 MITIGATING ACTIONS AND FINANCIAL POSITION
During the pandemic, the Group has undertaken significant
actions to mitigate the impact to its financial position, which
were continued post period-end into the current lockdown.
actions included:
•
• transferring all site employees and a majority of head office
employees on to the coronavirus Job Retention Schemes
immediately ceasing all non-essential spend
• all those not furloughed including at management and
executive team level agreed to temporary salary reductions
• ongoing discussions with all suppliers and partners to extend
credit terms, amend contracts and arrange payment plans
initiated discussions with all landlords to agree a combination of
rent waivers, deferrals and future variations/covid cesser clauses
to amended leases
•
FINANCING COSTS
the preference share dividend was £nil in FY20 (FY19: £3.9m) as a
result of the debt for equity financial reorganisation during FY19.
the FY20 reorganisation resulted in a reduction in the period-end
debt position (from £21.1m in FY19 to £12.4m in FY20) resulting in a
reduction in interest payable of 40% to £1.3m.
Dividends on preference shares
interest on bank overdrafts,
borrowings and foreign
exchange loss
Lease liability interest
Financing costs
FY20
£ 000
–
1,349
654
2,003
FY19
£ 000
3,941
2,241
741
6,923
15STRATEGIC REPORT VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020
PRINCIPAL RISKS & UNCERTAINTIES
the Directors formally assess the risks of the Group and look to take appropriate action to ensure these are mitigated wherever possible
where they could impact its objectives. the Directors consider the following to be the principal risks faced by the Group:
DESCRIPTION
MITIGATIONS
KEY RISKS
coViD-19
BREXit
the macroeconomic impact of covid-19 remains
uncertain, particularly on hospitality. the pandemic has
led to the complete closure of all the Group sites at
various stages over the last 12 months, having a
significant impact on the profitability of the Group. all
sites are currently closed, and whilst there is now a
proposed roadmap to reopening, it remains uncertain
whether further lockdowns will be required in the
future.
there continues to be uncertainty on the wider
economic impact of Brexit, particularly in areas such as
cost inflation from the depreciation of sterling, supply
issues and tariffs and disposable income and tourism.
coSt inFLation
REDuction in QuaLitY
the Group is subject to impacts from annual increases
across its main expenditures. Recent increases in
national Living Wage, utilities (especially through tariffs),
F&B supplies, as well as various other smaller costs, put
pressure on margins.
With an accelerated expansion plan across various
brands, there is a risk of lack of focus on food and service
standards, whilst ensuring continuous innovation to
ensure our product remains ahead of the competition.
LacK oF EXpanSion
oppoRtunitiES
as outlined elsewhere in the Strategic Report, the
growth of the business relies on identifying and securing
suitable sites on suitable financial terms. the Board has
payback criteria it utilises to approve all new sites so
availability of these sites is crucial to the success of the
business.
cHanGES in conSuMER
BEHaViouR & conFiDEncE
the Group operates in a competitive industry in the uK,
and is therefore subject to impacts from the wider
health of the uK economy. Levels of disposable income
and employment rates can have an impact on revenue,
as can changes in consumer behaviour.
REcRuitMEnt & REtEntion the Group’s performance is largely dependent
on the management team and employees across its
sites. it is therefore important that the Group can
continue to employ the right people, with the right
skills and experience.
as detailed in the Financial Review, the Group has taken
significant steps to combat the impact of the
pandemic, particularly on the liquidity of the business.
there has been regular dialogue between the Board of
Directors, and the Executive team.
the Group continually monitors its supply chain,
maintaining constant dialogue with suppliers,
including ensuring we have suitable alternatives.
the HR department works with an external
ER company to ensure the Group is up to date with
any changes to uK law due to the separation from
Eu employment law.
as the Group grows, there will be the ability to mitigate
some F&B costs through the economies of scale, whilst
the Group continually evaluates its labour model to
ensure it is efficient.
the Group understands that quality of product and
service is at the heart of the business and continues to
invest in numerous systems to constantly monitor
these in detail. these include the consolidating of all
social feedback, an extensive Mystery Diner
programme, continuous staff training and regular
in-house auditing of recipes and presentation standards.
the Group has hired a new property Director, with
extensive experience of finding, acquiring and opening
new sites in our sector. the Board is also confident that,
with the impact of covid-19 and the closures already
seen in the sector, as well as the changing of planning
with regards a3 units, there will be sufficient availability
in the short to medium term.
the Group maintains focus on both quality and value, to
ensure they are ahead of competitors. the estate also
benefits from being a diversified portfolio, both in terms
of geography and offer.
Whilst the leaving of the Eu has had a negative impact
on availability, the closure of a huge number of
hospitality and retail sites across the uK, combined with
a surge in unemployment in the lower age brackets,
means there is currently no shortage of supply.
our non-uK workforce population is being regularly
communicated to and supported in applying for the
Settlement Scheme. the Group has also invested in its
Human Resources department to ensure training, as
well as rewards and incentives, are continually improved
to aid staff turnover.
HEaLtH & SaFEtY
the Health & Safety of our staff, guests and suppliers
is of paramount importance to the Group.
Equally important is the need to ensure compliance
with numerous regulations for the sector including food
hygiene, allergens and fire safety.
the Group has a third-party specialist to ensure that it
adheres to the most up-to-date legislation. the Group
also undertakes extensive training with its staff, which is
then also monitored by various site visits and audits,
both from internal and external parties, to ensure
documented procedures and policies are being met.
cYBER SEcuRitY
as the Group grows, and its reliance on it increases,
there is a greater risk of impact on trading, reputational
damage or GDpR errors.
the Group employs a Head of it to ensure all upgrades /
changes to any systems are completed accurately and
that data protection measures are followed and
recorded. We are also continually monitoring and
investing in appropriate firewalls and security, utilising a
third-party provider.
16STRATEGIC REPORT VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 DIRECTORS’ DUTIES – S.172 STATEMENT
it is the Board’s responsibility to ensure that Various Eateries is
managed in the long-term interests of all shareholders and
stakeholders in the business.
the Board considers the needs and concerns of all stakeholders in
its running of the company. By seeking to understand the
differing stakeholder interests and impacts through a proactive
programme of engagement, the Directors ensure its decision-
making is informed and that the development and delivery of our
strategy leads to long-term sustainable success for Various
Eateries.
as required by section 172 of the uK companies act 2006, the
Directors have acted to promote the success of the company for
the benefit of its stakeholders. in meeting this responsibility during
the period, the Directors have had regard, amongst other
matters, to:
a. the likely consequences of any decisions in the long term;
b. the interests of the company’s employees;
c. the need to foster the company’s business relationships with
suppliers, customers and others;
d. the impact of the company’s operations on the community
and environment;
e. the company’s reputation for high standards of business
conduct; and
f. the need to act fairly as between members of the company.
STAKEHOLDER ENGAGEMENT
Further to the section 172 statement, the table below describes how the Group engages with its key stakeholders.
WHY WE ENGAGE
HOW WE ENGAGE
STAKEHOLDER INTERESTS
SHaREHoLDERS
the Board regards effective
communication with
shareholders as crucial to
understanding and meeting their
needs and expectations.
investor meetings and roadshows
•
• one-to-one meetings
•
• annual report and aGM
• corporate website
interim and annual announcements
coMMunitY anD EnViRonMEnt
We care about the communities
we operate in. We engage with
local people and groups in order
to learn how best we can support
the local economy, support local
charities and provide a distinct
and differentiated experience.
• creating all-day multi-use venues, designed
to meet the needs of local communities in a
post-covid-19 world
• Refurbishing and restoring historic buildings
• Hosting wellness and lifestyle events allowing
local communities to engage with each other
• providing support to local charities
• carbon and Emissions reporting
• Financial and operational performance
• Business model and strategy
• Governance
• trust in leadership team
•
investment and reinvigoration of local economies
including jobs for local people
• Locations for hosting community events
• charity
cuStoMERS
our success is dependent on
maintaining a distinct proposition
and relationship with our guests.
We must understand evolving
consumer requirements in order
to best meet their needs and
ensure continued loyalty.
EMpLoYEES
We are a people business. the
skills, experience and passion of
our employees enables us to
deliver the highest levels of
quality, standards and service. in
order to attract and retain the
best people, we offer competitive
pay rates and believe in fostering
a culture of collaboration, support,
two-way listening and inclusivity.
SuppLiERS/paRtnERS
our proposition is dependent on
access to the best ingredients
from italian and uK suppliers.
• providing a comfortable and relaxed home-from-
home experience and great hospitality
• a distinct and unique proposition
• an all-day offering allowing guests to eat, meet,
• Formal feedback and guest surveys
• Digital marketing and social media
• publicity activity through key lifestyle publications
• pop-up activity
• town hall meetings
• central and brand-specific intranets, providing
learning resources, community hubs and
a communication channel
• annual appraisals
• Staff newsletters
• targeted electronic campaign “check ins”
• annual engagement surveys
work or relax
• a broad, high-quality menu that incorporates
vegetarian, vegan and gluten-free options
• Exciting and convenient locations
• accessible pricing
• consistency in service
• Responsiveness to feedback
• training and development opportunities
• career progression and recognition
• compensation and incentives
• company culture and reputation
• Health, safety and wellbeing
• Honest and open dialogue and negotiation
• clear lines of communication/decision-making
• annual/six-monthly pricing review
• ongoing product/service review
• Direct feedback from operational level
• Disciplined ordering/approval process
• Menu development involvement
• Long-term and trusted partnerships
• Fair pricing with mutually beneficial growth
• Ethical and sustainable trading and procurement
• clear communication and processes
• aligned company culture and values
approved by the Board on 24 February 2021 and signed on its behalf by:
Oli Williams
Director
17STRATEGIC REPORT VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 18GOVERNANCEVARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 GoVERnancE
20 Board of Directors
22 Executive Chairman’s Statement
on Corporate Governance
25 Directors’ Report
28
Independent Auditor’s Report to
the Members of Various Eateries PLC
19GOVERNANCEVARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 BOARD OF DIRECTORS
ANDY BASSADONE
YISHAY MALKOV
OLIVER WILLIAMS
HUGH OSMOND
TIFFANY SWORD
GLYN BARKER
GARETH EDWARDS
Executive chairman
chief Executive officer
chief Financial officer
non-Executive Director
non-Executive Director
non-Executive Director
non-Executive Director
appointed
28 august 2020
28 august 2020
26 June 2020
28 august 2020
28 august 2020
28 august 2020
28 august 2020
oli, who is an ex-professional
cricketer, qualified as a
chartered accountant in
2011. He worked as an auditor
across various hospitality
and retail businesses and
was appointed Senior
Franchise accountant with
McDonald’s Restaurants
Limited in 2015. in 2016, oli
was appointed Head of
commercial Finance at itsu,
ultimately becoming Group
Financial controller in 2017.
He was appointed Finance
Director in 2018 and is now
chief Financial officer of
Various Eateries.
Yishay was an officer in the
israeli navy until 1999 when
he progressed to work as a
chef in a significant number
of restaurants within
new York, tel aviv and the
uK. Between 2003 and 2010
Yishay worked as Restaurant
Director at Gordon Ramsay
Holdings, uK, running the
claridge’s site. He went on to
found and operate the
award-winning Bertie
restaurant in israel, before
returning to the uK to take a
position as General Manager
at Roka restaurant followed
by Executive operations
Director at the ivy collection
overseeing the roll-out of the
group to 30 sites in four
years. Between 2019 and
2020, Yishay was Managing
Director of the international,
high-end, restaurant group,
park chinois, leading a
successful turnaround
programme and opening a
new London site. He was
appointed cEo of Various
Eateries in 2020.
andrew Bassadone has
significant experience in the
restaurant and hospitality
sector. He was Managing
Director (Europe) of My
Kinda town, which floated
on the London Stock
Exchange in 1994 and which
was ultimately sold to capital
Radio in 1996. He worked as
Senior Vice president for
Europe for planet Hollywood
before moving to a role as
chief Executive at Signature
Restaurants. Between 1998
and 2005, andy led the
acquisitions of restaurants
including Belgo, the ivy, J.
Sheekey, Le caprice and
Daphnes and co-founded a
new restaurant business –
Strada. Signature
Restaurants was sold in 2005
but andy continued as chief
Executive in the new
acquisition entity, ultimately
leading to the sale of Strada
in 2007 for £140m and
co-founding côté at the
same time. côte was sold in
2013 for £100m, whilst andy
focused on developing Bill’s
restaurant and the initial
expansion of the ivy café
brand. He joined and
invested in Various Eateries
in 2019.
Hugh founded Sun capital
partners Limited in 2001 and
osmond capital Ltd in 2017.
He continues to operate both
companies. in 1993, Hugh
co-led the £18m acquisition
and market listing of
pizzaExpress. During the
eight years he remained on
the board, pizzaExpress
became one of the uK’s
largest sit down casual dining
groups and the value of the
company increased more
than 20-fold. over this period,
annual losses were turned
into profits of £38m. in 1997,
Hugh co-founded punch
Group and, as Executive
chairman, he orchestrated
the acquisition and
integration of the allied
Domecq Retail estate, the
Bass leased estate and inn
Business, to create the uK’s
largest pub group. punch
Group reached an enterprise
value of £3.5bn in 2005.
Hugh co-founded pearl
Group in 2005. pearl was
acquired for £1.1bn from
Henderson plc and
embedded value was
subsequently grown to
£2.3bn. pearl Group acquired
Resolution plc in 2008 and
the enlarged group (renamed
phoenix Group) floated in
2009. phoenix is now the
largest uK insurance
consolidator and is listed in
the FtSE 100 index. Most
recently, Hugh led the
investment into capital
physio in 2019. He founded
Various Eateries in 2014.
tiffany studied architecture
Glyn is a chartered
Gareth is a qualified solicitor
at the university of
accountant and worked at
and was previously a partner
cambridge and, after time at
pwc until he stepped down
at pinsent Masons LLp,
DE & J Levy and L’oreal uK
in 2011. During his time at
where he held both the
she moved to work
pwc Glyn held positions
positions of Global Head of
alongside Hugh osmond at
Sun capital partners
including uK Head of
assurance, Managing
corporate and international
Development partner. He is
Limited. tiffany worked with
partner (uK), Vice chairman
currently a strategic
Hugh on the creation of
(uK) and chief Executive,
consultant and an executive
coppa club from its
Markets (Europe). Glyn is the
director of London Bridge
inception in 2015, and led the
chairman of irwin Mitchell.
capital Limited, an Fca
launch of the first site in
Sonning-on-thames as
He has significant public
authorised corporate finance
markets experience and is
boutique. He is also a
Managing Director. More
currently the chairman of
director of FXpress payment
recently tiffany led the
investment into capital
physio Limited and the
the Berkeley Group
Services Limited. an Fca
Holdings plc, a director of
transocean Limited and a
and HMRc authorised
international payment
development of its high
senior advisory partner of
services company. He has
street physiotherapy brand,
novalpina capital. He
significant public markets
Bodyset, which is currently
previously acted as senior
experience and is chairman
being rolled out. tiffany is
independent director of
of Honye Financial Services
also a director of
osmond capital.
aviva plc until 2019.
Limited and Senior
independent Director of
Local Shopping REit plc
which are all quoted on the
London Stock Exchange; and
he also brings significant aiM
experience to the Board,
having acted on the aiM
Disciplinary and appeals
committee until 2017.
committees
A Re
A N Re
A N Re
A N Re
20GOVERNANCEVARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020
Committee
membership
A audit and aiM compliance
N nomination
Re Remuneration
committee chair
ANDY BASSADONE
YISHAY MALKOV
OLIVER WILLIAMS
HUGH OSMOND
TIFFANY SWORD
GLYN BARKER
GARETH EDWARDS
Executive chairman
chief Executive officer
chief Financial officer
non-Executive Director
non-Executive Director
non-Executive Director
non-Executive Director
appointed
28 august 2020
28 august 2020
26 June 2020
28 august 2020
28 august 2020
28 august 2020
28 august 2020
andrew Bassadone has
Yishay was an officer in the
oli, who is an ex-professional
Hugh founded Sun capital
significant experience in the
israeli navy until 1999 when
cricketer, qualified as a
partners Limited in 2001 and
restaurant and hospitality
he progressed to work as a
chartered accountant in
osmond capital Ltd in 2017.
sector. He was Managing
chef in a significant number
2011. He worked as an auditor
He continues to operate both
Director (Europe) of My
of restaurants within
across various hospitality
companies. in 1993, Hugh
Kinda town, which floated
new York, tel aviv and the
and retail businesses and
co-led the £18m acquisition
on the London Stock
uK. Between 2003 and 2010
was appointed Senior
and market listing of
Exchange in 1994 and which
Yishay worked as Restaurant
Franchise accountant with
pizzaExpress. During the
was ultimately sold to capital
Director at Gordon Ramsay
McDonald’s Restaurants
eight years he remained on
Radio in 1996. He worked as
Holdings, uK, running the
Limited in 2015. in 2016, oli
Senior Vice president for
claridge’s site. He went on to
was appointed Head of
the board, pizzaExpress
became one of the uK’s
Europe for planet Hollywood
found and operate the
commercial Finance at itsu,
largest sit down casual dining
before moving to a role as
award-winning Bertie
ultimately becoming Group
groups and the value of the
chief Executive at Signature
restaurant in israel, before
Financial controller in 2017.
company increased more
Restaurants. Between 1998
returning to the uK to take a
He was appointed Finance
than 20-fold. over this period,
and 2005, andy led the
position as General Manager
Director in 2018 and is now
annual losses were turned
acquisitions of restaurants
at Roka restaurant followed
chief Financial officer of
into profits of £38m. in 1997,
including Belgo, the ivy, J.
by Executive operations
Various Eateries.
Sheekey, Le caprice and
Director at the ivy collection
Daphnes and co-founded a
overseeing the roll-out of the
new restaurant business –
group to 30 sites in four
Strada. Signature
years. Between 2019 and
Restaurants was sold in 2005
2020, Yishay was Managing
but andy continued as chief
Director of the international,
Executive in the new
high-end, restaurant group,
acquisition entity, ultimately
leading to the sale of Strada
park chinois, leading a
successful turnaround
in 2007 for £140m and
programme and opening a
co-founding côté at the
new London site. He was
same time. côte was sold in
appointed cEo of Various
Eateries in 2020.
2013 for £100m, whilst andy
focused on developing Bill’s
restaurant and the initial
expansion of the ivy café
brand. He joined and
invested in Various Eateries
in 2019.
Hugh co-founded punch
Group and, as Executive
chairman, he orchestrated
the acquisition and
integration of the allied
Domecq Retail estate, the
Bass leased estate and inn
Business, to create the uK’s
largest pub group. punch
Group reached an enterprise
value of £3.5bn in 2005.
Hugh co-founded pearl
Group in 2005. pearl was
acquired for £1.1bn from
Henderson plc and
embedded value was
subsequently grown to
£2.3bn. pearl Group acquired
Resolution plc in 2008 and
the enlarged group (renamed
phoenix Group) floated in
2009. phoenix is now the
largest uK insurance
consolidator and is listed in
the FtSE 100 index. Most
recently, Hugh led the
investment into capital
physio in 2019. He founded
Various Eateries in 2014.
tiffany studied architecture
at the university of
cambridge and, after time at
DE & J Levy and L’oreal uK
she moved to work
alongside Hugh osmond at
Sun capital partners
Limited. tiffany worked with
Hugh on the creation of
coppa club from its
inception in 2015, and led the
launch of the first site in
Sonning-on-thames as
Managing Director. More
recently tiffany led the
investment into capital
physio Limited and the
development of its high
street physiotherapy brand,
Bodyset, which is currently
being rolled out. tiffany is
also a director of
osmond capital.
Glyn is a chartered
accountant and worked at
pwc until he stepped down
in 2011. During his time at
pwc Glyn held positions
including uK Head of
assurance, Managing
partner (uK), Vice chairman
(uK) and chief Executive,
Markets (Europe). Glyn is the
chairman of irwin Mitchell.
He has significant public
markets experience and is
currently the chairman of
the Berkeley Group
Holdings plc, a director of
transocean Limited and a
senior advisory partner of
novalpina capital. He
previously acted as senior
independent director of
aviva plc until 2019.
Gareth is a qualified solicitor
and was previously a partner
at pinsent Masons LLp,
where he held both the
positions of Global Head of
corporate and international
Development partner. He is
currently a strategic
consultant and an executive
director of London Bridge
capital Limited, an Fca
authorised corporate finance
boutique. He is also a
director of FXpress payment
Services Limited. an Fca
and HMRc authorised
international payment
services company. He has
significant public markets
experience and is chairman
of Honye Financial Services
Limited and Senior
independent Director of
Local Shopping REit plc
which are all quoted on the
London Stock Exchange; and
he also brings significant aiM
experience to the Board,
having acted on the aiM
Disciplinary and appeals
committee until 2017.
committees
A Re
A N Re
A N Re
A N Re
21GOVERNANCEVARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020
EXECUTIVE CHAIRMAN’S STATEMENT
ON CORPORATE GOVERNANCE
as chairman of the Board of Directors of Various Eateries,
my responsibilities include leading the Board effectively,
overseeing the company’s corporate governance model,
communicating with shareholders, and ensuring that good
information flows freely between the Executive Directors and
the non-Executive Directors in a timely and efficient manner.
it is the Board’s responsibility to ensure that Various Eateries pLc
is managed in the long-term interests of all shareholders and
stakeholders in the business. the Board believes a strong and
effective corporate governance culture is critical in this respect as
we endeavour to grow a resilient and sustainable business for the
benefit of our shareholders, customers, people and suppliers. the
building blocks are firmly in place, through the recruitment of
strong executives and nEDs, as well as the creation of committees
and structures as detailed.
THE QCA CORPORATE GOVERNANCE CODE
Various Eateries has adopted the 2018 Qca corporate Governance
code (the ‘code’) on a comply or explain basis. the code is
constructed around ten broad principles and the report below sets
out how we comply with the code at this time. compliance with
the code will be reviewed and updated annually, and further
information can be found within the compliance statement
published on our website.
1) Establish a strategy and business model which promotes
long-term value for shareholders
the Group’s strategy is to drive the long-term growth of the
business. the Group’s business model and strategy are described
on pages 12 to 13 of the Strategic Report.
2) Seek to understand and meet shareholder needs
and expectations
Various Eateries has a policy of maintaining open two-way lines of
communication with all investors to ensure a clear understanding
of the strategy, business plan and current trading. this is achieved
through a combination of regular investor meetings (both formal
and informal) and quick replies to all queries received.
the Directors see the annual General Meeting (‘aGM’) as an
important opportunity to meet its shareholders either in person
or online, and encourages all investors to participate and discuss
their views. Where feedback is provided, including voting
decisions against company expectations, the Board will engage
with those shareholders to hear and address any issues.
4) Embed effective risk management, considering both
opportunities and threats, throughout the organisation
the company operates a robust risk assessment process, which is
embedded in the normal management and governance of the
business. as part of the annual planning and budgeting process,
management document the significant risks identified, the
probability of those risks occurring, their potential impact, and the
plans for managing and mitigating each of those risks.
the Board discusses potential risks at each Board meeting.
it will also undertake a formal annual effectiveness review of the
company’s internal control system, comprising financial,
operational and compliance controls, to ensure that the company’s
risk management framework identifies and addresses all relevant
risks in order that the company’s strategy can be successfully
executed and delivered. this review considers any significant issues
included in reports received during the year and how the risks may
have changed during the year and reviews any reports on internal
controls prepared by management as well as any issues identified
by external auditors.
the company operates a series of controls to ensure the Executive
team implements the policies for risk management and control.
these include: the annual strategic planning and budgeting
process; a clearly defined organisational structure; authorisation
limits; monthly reviews by the Executive team of financial and
other operational Kpis.
the audit and aiM compliance committee (‘ac’) meets
periodically to review the effectiveness of internal controls.
the ac receives reports from management and observations
from the external auditors concerning internal control systems
and any material control weaknesses. any significant issues
flagged would be included in the risk section of the next
Board meeting.
principal risks faced by the Group are included on page 16 in the
Strategic Report.
Both the Board and the Executive team are responsible for
reviewing and evaluating risk. the Executive team meets at least
monthly to review ongoing trading performance, discuss budgets
and forecasts and new risks associated with ongoing trading, whilst
these figures are also made available to the wider Board and
discussed in Board meetings.
all corporate information (including any company
announcements) is available to shareholders, investors and the
public at any time on the corporate website. the key point of
contact for all shareholders is Group cFo, oli Williams. See more in
our section 172 statement on page 17 of the Strategic Report.
5) Maintain the board as a well-functioning, balanced team
led by the chair
the company is controlled by the Board of Directors, the
responsibility of running which falls to andy Bassadone as the
chairman. Yishay Malkov, the cEo, has executive responsibility for
running the business and implementing Group strategy.
3) Take into account wider stakeholder and social
responsibilities and their implications for long-term success
the Board recognises that strong, trusted relationships with all
stakeholders (both internal and external) is vital for the long-term
success of the Group. See more in our section 172 statement on
page 17.
the Board comprises three Executive Directors and four
non-Executive Directors. two of these Directors, whilst holding
a small immaterial shareholding, are considered as independent
by the Board.
the Board meets at least every month and all Directors receive all
trading and operational results every month (as per the agreed
timetable and in advance of any meetings). there is a
documented schedule of matters reserved for the Board.
22GOVERNANCEVARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 8) Promote a corporate culture that is based on ethical values
and behaviours
the Board aims to lead by example, and to do what is in the best
interests of the company.
the company takes a serious approach towards corporate social
responsibility, its values relating to company culture and its people;
the decisions of the management team and the company
strategy are also guided by the values wherever appropriate.
With a growing business that encompasses numerous levels of
team diversity and multi-site operations, the company recognises
the vital importance of maintaining a strong company culture
and clear values to its success. the management team also
understands the extent to which the skills, experience and passion
of our employees enables us to deliver the highest levels of quality,
standards and service – so that ultimately, our guests enjoy the
best experience possible with us.
our teams are chosen carefully; we want people who share the
same passion that we have for our guests, and we want people
looking to work hard, stay with us and become part of the Various
Eateries family. We have clear purpose statements for each brand,
underpinned by the same three consistent values and supporting
behaviours across the Group.
the Board continuously seeks to ensure that all of its employees
are aware of the company’s core ethical values, and the
management structure at restaurant and regional level ensures
that the ethical values are recognised and respected throughout
the Group.
the values are covered repeatedly throughout the employee
journey through the business: from job descriptions through
interview, the mandatory induction process for new employees,
regular Group-wide “town hall” meetings and training sessions and
staff newsletters. they are used as points of assessment in annual
appraisals which influence promotion and reward, ensuring that all
team members are working to the highest operational and ethical
standards.
Board members undertake regular informal enquiries of
employees to ensure these values are being upheld and promoted
to ensure a healthy corporate culture. Feedback from all
stakeholders allows the Board to maintain an awareness of the
state of its corporate culture, as well as performance against
internal targets.
the Board is supported by the audit and aiM compliance
committee, the nomination committee and the Remuneration
committee as detailed below against principle 9.
other than in respect of the ipo, no formal Board or committee
meetings took place between incorporation and year end.
the company maintains liability insurance for its Directors and
officers. the company has also entered into indemnity
agreements with the Directors, in terms of which the company has
indemnified its Directors, subject to the companies act 2006
limitations, against any liability arising out of the exercise
of the Directors’ powers, duties and responsibilities as a Director
or officer.
6) Ensure that between them the directors have the necessary
up-to-date experience, skills and capabilities
the company has seven Directors being Hugh osmond,
andy Bassadone, Gareth Edwards, Glyn Barker, Yishay Malkov,
oli Williams and tiffany Sword.
Details of the Board’s extensive industry experience, skills and
personal qualities are highlighted in the biographies on pages 20
and 21.
the Board keeps a close eye on all industry changes and receives
regulatory and corporate updates from a number of external
advisors who advise where necessary on the legal aspects of any
ongoing regulatory enquiries. this ensures that the necessary mix
of experience, skills, personal qualities and capabilities delivers the
strategy of the company for the benefit of the shareholders over
the medium to long term.
7) Evaluate board performance based on clear and relevant
objectives, seeking continuous improvement
no evaluation of the Board has been required to date.
Executive Directors will be assessed annually on performance by
the chairman before re-election, based on:
•
•
• continued commitment to the role.
their performance (measured against Kpis);
their independence (where applicable);
in addition, the overall effectiveness of the Board is measured
on the achievements of the company’s annual budget and
strategic plan.
Whilst the company has no formal succession plan, the Board
continues to think long-term and will appoint senior roles
where required.
the Board is confident that the company’s middle management
have the strength to ensure the company’s business is not
adversely impacted in the period between an Executive Director
leaving and a replacement being recruited.
the nomination committee is required to recommend and
review nominees as new directors to the Board where there are
vacancies or where it is felt that additional directors should be
appointed. For new appointments, the search for candidates is
conducted and appointments made on merit against objective
criteria and with due regard for the benefits of diversity on the
Board. any senior management appointments are also required
to be approved by the nomination committee.
23GOVERNANCEVARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 EXECUTIVE CHAIRMAN’S STATEMENT
ON CORPORATE GOVERNANCE
continuED
10) Communicate how the company is governed and is
performing by maintaining a dialogue with shareholders
and other relevant stakeholders
the company communicates with shareholders through the
annual Report, interim and annual announcements, the aGM,
investor roadshows and meetings with individual existing or
potential new investors. See more in our section 172 statement
on page 17.
9) Maintain governance structures and processes that are fit for
purpose and support good decision-making by the board
the Board has established audit and aiM compliance,
nomination and Remuneration committees, which meet
regularly with formally delegated duties and responsibilities.
Audit and AiM Compliance Committee
the ac comprises the four non-Executive Directors, with
Glyn Barker as chair. the ac meets at least twice a year and
at such other times as the chair of the ac shall deem necessary.
the ac reviews the scope and results of the external audit, its cost
effectiveness and the objectivity of the auditors. it also reviews,
prior to publication, the interim financial statements, preliminary
results announcement, the annual financial statements and the
other information included in the annual Report. in addition,
the ac considers the regulatory, technical and operational risks of
the company and ensures these risks are properly assessed,
monitored and reported on and the appropriate policies and
procedures are in place.
Remuneration Committee
the Remuneration committee comprises the four
non-Executive Directors, with Gareth Edwards as chair of
the committee. as chair, Gareth Edwards has the casting vote.
the Remuneration committee meets at least twice per financial
year. the Remuneration committee reviews and recommends
nominees as new directors to the Board, reviews the performance
of the Executive Directors and sets the remuneration of the
Executive Directors. in addition, the committee determines the
payment of bonuses to Executive Directors and approves the
company’s bonus and incentive arrangements for employees.
the remuneration of the non-Executive Directors is decided upon
by the Board of Directors. the committee is also responsible for
ensuring the company’s share option schemes are operated
properly and approves the share option grants to Executive
Directors and employees.
Nomination Committee
the nomination committee comprises tiffany Sword, Glyn Barker
and Gareth Edwards, with tiffany Sword as chair of the committee.
it meets at least twice a year. the committee is appointed by the
Board to assist the company and the Board in fulfilling their
respective corporate governance responsibilities under applicable
laws, to promote a culture of integrity throughout the company
and to assist the company in identifying and recommending new
nominees for election to the Board.
the company has a schedule of matters reserved for the Board.
the Board is responsible for formulating, reviewing and approving
the Group’s strategy, budgets and corporate actions.
the Board also ensures that the principal goal of the company is
to create shareholder value, while having regard to other
stakeholder interests, and takes responsibility for setting the
company’s values and standards.
at this stage the Board believes that the governance framework is
appropriate for a company of its size, but it continues to keep this
under review.
24GOVERNANCEVARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 DIRECTORS’ REPORT
the Directors present the Directors’ Report on the affairs of
Various Eateries pLc (‘the company’) and its subsidiaries
(‘the Group’), together with their audited consolidated financial
statements for the 52-week period ended 27 September 2020
(prior period comparatives are for the 52-week period ended
29 September 2019).
the corporate Governance Statement on pages 22 to 24 also
forms part of the Directors’ Report.
Principal activity
the principal activity of the Group is the operation and
management of restaurants, bars and hotels.
Review of the business and future developments
information about the progress of the business and the Group’s
corporate activities is given in the chairman’s & chief Executive’s
Statement on pages 6 to 9 and the Financial Review on pages 14
and 15 of the Strategic Report.
Charitable and political donations
the Group makes occasional contributions to community-related
initiatives. the Group made no political donations in the period.
Statement as to disclosure of information to auditors
the Directors who were in office on the date of approval of these
financial statements have confirmed that as far as they are aware,
there is no relevant audit information of which the auditors are
unaware. the Directors have confirmed that they have taken all
the steps that they ought to have taken as Directors in order to
make themselves aware of any relevant audit information and to
establish that it has been communicated to the auditor.
Streamlined Energy and Carbon Reporting (SECR) /
Energy Consumption
the Group presents its greenhouse gas (‘GHG’) emissions and
energy use data for the first time under Streamlined Energy and
carbon Reporting (‘SEcR’) for the period ended 27 September
2020:
Matters of strategic importance
the business review and future outlook, key performance
indicators, and the principal risks and uncertainties and
engagement with suppliers, customers and others, required by
Schedule 7 of the Large and Medium-sized companies and
Groups (accounts and Reports) Regulations 2008 have been
included in the Strategic Report in accordance with section 414c
(11) of the companies act 2006.
natural Gas
Direct transport
Electricity
Total
Energy
Consumption
(kWh)
1,992,895
78,187
2,236,293
4,307,375
GHG
Emissions
(tCO²e)
386
521
637
907
Scope 1 – natural Gas and Direct transport
Scope 2 – Electricity (Location Based)
Scope 2 – Electricity (Market Based)
Total Scope 1 and 2 Emissions (Location Based)
Total Scope 1 and 2 Emissions (Market Based)
1,023
Intensity Ratio
Revenue (£ 000)
Total tCO²e per £m revenue
16,469
55.08
Results and dividends
the consolidated statement of comprehensive income is set
out on page 36 of the financial statements and shows the
comprehensive loss for the period.
Dividends on preference shares payable by the company for the
period are £nil (2019: payable by the Group, £3,941,000). the
Directors do not recommend the payment of any other dividend.
Capital structure
Details of the issued share capital, together with details of the
movements in the company’s issued share capital during the
year are shown in note 24 on page 58 of the financial statements.
Each ordinary share carries the right to one vote at general
meetings of the company.
Directors of the Company
the Directors who served throughout the period and up until
the date of signing, except as noted, were as follows:
Ga Barker (appointed 27 august 2020)
aK Bassadone (appointed 27 august 2020)
GM Edwards (appointed 27 august 2020)
Y Malkov (appointed 27 august 2020)
HEM osmond (appointed 27 august 2020)
tc Sword (appointed 27 august 2020)
o Williams (appointed 26 June 2020)
Biographical details of each of the Directors in office at the year
end are included in the Board of Directors section (pages 20
and 21).
25GOVERNANCEVARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 DIRECTORS’ REPORT
continuED
Directors’ remuneration
the remuneration of the Directors of the parent company who
held office during the period was:
Salary and
fees
£ 000
Employer
pension
contribution
£ 000
30
2
2
17
55
–
55
161
–
–
–
1
–
–
–
1
Total
£ 000
30
2
2
18
55
–
55
162
o Williams
tc Sword
HEM osmond
Y Malkov
GM Edwards
aK Bassadone
Ga Barker
Total
Directors’ interests in shares
Directors’ interests in the shares of the company, including family
interests, were as follows:
HEM osmond
aK Bassadone
tc Sword
o Williams
Y Malkov
GM Edwards
Ga Barker
At 27 September 2020
Shares
owned
No.
Outstanding
Directors’
share awards
No.
42,781,240
–
3,473,817
1,428,571
4,187
–
1,095,238
1,095,238
2,190,476
2,190,476
119,047
158,730
–
–
Further detail on the outstanding Directors’ share awards can be
found in note 27 to the financial statements.
Directors’ liability insurance and indemnity
the Group has arranged insurance cover in respect of legal action
against its Directors. to the extent permitted by uK law, the Group
also indemnifies the Directors. these provisions were in force
throughout the year and in force at the date of this report.
Substantial shareholdings
the company is aware that the following had an interest of 3% or
more of the issued ordinary share capital of the company at
24 February 2021.
HEM osmond
canaccord Genuity
Wealth Management
aK Bassadone*
octopus capital
Number of
shares
% Holding
42,781,240
48.06%
21,319,948
23.95%
3,473,817
3,000,000
3.90%
3.37%
3.08%
Lombard odier asset Management
2,739,726
* 1,428,571 of these shares are held jointly with compound Management (uK)
Limited.
Employment policy
our people truly are our greatest asset and we believe in treating
them as such: with respect, looking after their welfare and
allowing them the opportunity to develop their job and life skills
and progress through the organisation. We encourage a work
environment that is fair, open and communicative. our employees
have a performance review at least once a year, which includes
consideration of skills development and career prospects. We aim
to retain, develop and promote our best staff, offering a variety of
training courses and development opportunities. informal, frank
and open dialogue is encouraged at all levels of the Group.
We aim to keep our employees informed of any changes and
progress with the business on a regular basis in an engaging way.
communication flows both ways, as we take the views of our
employees seriously. our aim has been to make it as easy as
possible for our employees to air their opinions, express their
ideas and voice any problems they may have. Examples include
a cascade process of meetings to communicate key messages
throughout the organisation, a weekly feedback process
for operational issues and daily meetings of restaurant
team members.
We have a diverse workforce and an equal opportunities policy in
place. We aim to employ people who reflect the diverse nature of
society and value people and their contribution irrespective of age,
sex, disability, sexual orientation, race, colour, religion, marital status
or ethnic origin. We do not tolerate harassment or bullying in any
shape or form. procedures are in place to respond to accusations
of workplace discrimination, harassment and victimisation.
an effective employee grievance procedure is in operation, and
the policy is properly communicated to our people. applications
from disabled persons are given full consideration providing the
disability does not seriously affect the performance of their duties.
Such persons, once employed, are given appropriate training and
equal opportunities. in the event of members of staff becoming
disabled every effort is made to ensure that their employment
within the Group continues and that the appropriate training is
arranged. it is the policy of the Group that the training, career
development and promotion of disabled employees should,
as far as possible, be identical to that of other employees.
26GOVERNANCEVARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 S.172 Statement
the Directors behave and carry out their activities to promote the
long-term success of the Group. More detail is shown in the
Strategic Report on page 17 as the Directors believe it to be of
strategic importance to the Group.
Directors’ Responsibilities Statement
the Directors are responsible for preparing the Strategic Report,
the Directors’ Report and the financial statements in accordance
with applicable law and regulations.
company law requires the Directors to prepare Group and
company financial statements for each financial year. the Directors
have elected under company law and the aiM Rules of the London
Stock Exchange to prepare the Group financial statements in
accordance with international accounting Standards in conformity
with the requirements of the companies act 2006 and have
elected under company law to prepare the company financial
statements in accordance with united Kingdom Generally
accepted accounting practice (united Kingdom accounting
Standards and applicable law) in conformity with the requirements
of the companies act 2006 and applicable law.
the Group and company financial statements are required by law
and international accounting Standards in conformity with the
requirements of the companies act 2006 to present fairly the
financial position of the Group and the company and the financial
performance of the Group. the companies act 2006 provides in
relation to such financial statements that references in the relevant
part of that act to financial statements giving a true and fair view
are references to their achieving a fair presentation.
Legislation in the united Kingdom governing the preparation and
dissemination of financial statements may differ from legislation
in other jurisdictions.
Post balance sheet events
included in note 30 to the Financial Statements on page 63.
Going concern
in adopting the going concern basis for preparing the financial
statements for the period ended 27 September 2020, the Directors
have considered the business model and strategies, as set out on
pages 12 to 13, the Group’s principal risks and uncertainties as set
out on page 16 as well as taking into account the current cash
position and potential facilities.
Based on the Group’s cash flow forecasts and projections, the
Board is satisfied that the Group will be able to operate within the
level of its facilities for the foreseeable future. in making this
assessment, the Directors have made a specific analysis of the
impact of both covid-19 and Brexit. For this reason, the Board
considers it appropriate for the Group to adopt the going concern
basis in preparing its financial statements.
Auditor
RSM uK audit LLp has indicated its willingness to continue
in office.
approved by the Board on 24 February 2021 and signed on its
behalf by:
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 the company and of
the profit or loss of the Group for that period.
Oli Williams
Director
20 St thomas Street
London
SE1 9RS
in preparing each of the Group and company financial statements,
the Directors are required to:
a. select suitable accounting policies and then apply them
consistently;
b. make judgements and accounting estimates that are
reasonable and prudent;
c. state whether they have been prepared in accordance with
international accounting standards in conformity with the
requirements of the companies act 2006;
d. prepare the financial statements on the going concern basis
unless it is inappropriate to presume that the Group and the
company will continue in business.
the Directors are responsible for keeping adequate accounting
records that are sufficient to show and explain the Group’s and the
company’s transactions and disclose with reasonable accuracy at
any time the financial position of the Group and the company and
enable them to ensure that the financial statements comply with
the requirements of the companies act 2006. they are also
responsible for safeguarding the assets of the Group and the
company and hence for taking reasonable steps for the prevention
and detection of fraud and other irregularities.
the Directors are responsible for the maintenance and integrity of
the corporate and financial information included on the Various
Eateries pLc website.
27GOVERNANCEVARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 INDEPENDENT AUDITOR’S REPORT TO
THE MEMBERS OF VARIOUS EATERIES PLC
Based on the work we have performed, we have not identified
any material uncertainties relating to events or conditions that,
individually or collectively, may cast significant doubt on the
Group’s or the parent company’s ability to continue as a going
concern for a period of at least 12 months from when the financial
statements are authorised for issue.
our responsibilities and the responsibilities of the Directors with
respect to going concern are described in the relevant sections of
this report.
Summary of our audit approach
Key audit matters
Materiality
Scope
Group
•
impairment of goodwill and property,
plant and equipment
• adoption of iFRS 16 Leases in respect
of new sites
Group
• overall materiality: £354,000
(2019: £1,110,000)
• performance materiality: £265,000
(2019: £836,000)
Parent Company
• overall materiality: £176,500 (2019: n/a)
• performance materiality: £132,000
(2019: n/a)
our audit procedures (on a sample basis)
covered 100% of revenue, 100% of total
assets and 100% of loss before tax.
Key audit matters
Key audit matters are those matters that, in our professional
judgement, were of most significance in our audit of the Group and
parent company financial statements and include the most
significant assessed risks of material misstatement (whether or
not due to fraud) we identified, including those which had the
greatest effect on the overall audit strategy, the allocation of
resources in the audit and directing the efforts of the engagement
team. these matters were addressed in the context of our audit of
the Group and parent company financial statements as a whole,
and in forming our opinion thereon, and we do not provide a
separate opinion on these matters.
Opinion
We have audited the financial statements of Various Eateries pLc
(the ‘parent company’) and its subsidiaries (the ‘Group’) for the
period ended 27 September 2020 which comprise the
consolidated statement of comprehensive income, consolidated
statement of financial position, parent company balance sheet,
consolidated statement of changes in equity, company statement
of changes in equity, consolidated statement of cash flows and
notes to the financial statements, including accounting policies.
the financial reporting framework that has been applied in the
preparation of the Group financial statements is applicable law and
international accounting Standards in conformity with the
requirements of the companies act 2006. the financial reporting
framework that has been applied in the preparation of the parent
company financial statements is applicable law and united
Kingdom accounting Standards, including Financial Reporting
Standard 101 Reduced disclosure framework (united Kingdom
Generally accepted accounting practice).
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
27 September 2020 and of the Group’s loss for the 52-week
period then ended;
the Group financial statements have been properly prepared in
accordance with international accounting Standards in
conformity with the requirements of the companies act 2006;
the parent company financial statements have been properly
prepared in accordance with united Kingdom Generally
accepted accounting practice; and
the financial statements have been prepared in accordance
with the requirements of the companies act 2006.
•
•
•
Basis for opinion
We conducted our audit in accordance with international
Standards on auditing (uK) (‘iSas (uK)’) and applicable law. our
responsibilities under those standards are further described in the
“auditor’s responsibilities for the audit of the financial statements”
section of our report. We are independent of the Group and parent
company in accordance with the ethical requirements that are
relevant to our audit of the financial statements in the uK,
including the FRc’s Ethical Standard as applied to listed entities
and we have fulfilled our other ethical responsibilities in
accordance with these requirements. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide
a basis for our opinion.
Conclusions relating to going concern
in auditing the financial statements, we have concluded
that the Directors’ use of the going concern basis of accounting
in the preparation of the financial statements is appropriate.
our evaluation of the Directors’ assessment of the Group’s and
parent company’s ability to continue to adopt the going concern
basis of accounting included consideration of the Group’s and
parent company’s current cash resources and consideration of
management’s going concern accounting policy. our key
observation arising from that evaluation is that, notwithstanding
current difficulties in the economy at large, taking into account
in particular the funds raised at the initial public offering in
September 2020, the preparation of the financial statements
on the going concern basis is appropriate.
28GOVERNANCEVARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 Impairment of goodwill and property, plant and equipment
Key audit matter
description
the total net carrying value at 27 September 2020 of goodwill was £12.6m and that of property, plant and
equipment (‘ppE’) £33.4m. Economic and trading conditions (including as a result of covid-19) faced by the
restaurant and hospitality sector in the uK have been severe during a proportion of the period ended
27 September 2020 and since that date. as required by iaS 36 Impairment of assets, management undertook
detailed impairment testing to determine whether such assets were impaired and recognised a total
impairment charge of £5.4m in respect of sites which were forecast to underperform in the short to medium
term either partly or wholly as a result of the covid-19 pandemic.
Because of the significant management judgement involved in forecasting cash flows, in considering the
timing and quantum of generation of cash flows, a change in assumptions used could have a material impact
on the financial statements and this was therefore determined to be a key audit matter.
Refer to note 3 – Critical accounting judgements and key sources of estimation uncertainty, note 14 –
Intangible assets and note 15 – Property, plant and equipment.
How the matter
was addressed
in the audit
Our audit approach included:
• obtaining management’s site-by-site impairment review;
• challenging the reasonableness of inputs including considering the accuracy of calculations in the
impairment review;
• challenging management’s assumptions in respect of recoverable amounts including value-in-use
Key observations
and fair value;
• considering the impact of covid-19 on forecast periods used in management’s cash flow analyses;
•
reviewing the disclosures in the financial statements for adequacy in the light in particular of uncertainties
resulting from the pandemic.
as a result in particular of covid-19 and combined multiple uncertain future scenarios including, but not
limited to, government policy and lockdowns, the timing and availability of effective vaccines and treatments,
the impact of covid-19 on general consumer sentiment and the timing and extent of recovery of the restaurant
and hospitality sector, management have included disclosures in note 14 to explain the sensitivity inherent in
determining appropriate carrying values of goodwill and property, plant and equipment at 27 September 2020.
Adoption of IFRS 16 Leases in respect of new sites
Key audit matter
description
During the period ended 27 September 2020 the Group acquired sites in respect of which leases were required
under iFRS 16 Leases to be recognised on the balance sheet to a value of £11.5m (right-of-use assets) and £5.3m
(lease liabilities). the application of iFRS 16 involves a significant degree of judgement in respect of key
assumptions involving, amongst other matters, lease terms and incremental borrowing rates.
How the matter
was addressed
in the audit
Because of the materiality of the amounts and the degree of management estimation and judgement
required we have determined the application of iFRS 16 to be a key audit matter.
Refer to note 6 – Business combinations and note 15 – Property, plant and equipment.
Our audit approach included:
• obtaining management’s calculations of lease value-in-use and liability at 27 September 2020 in relation to
the new sites included in the Group financial statements at that date;
• confirming inputs to lease agreements and challenging any key assumptions made by management;
• challenging the incremental borrowing rate used, and comparing to third-party data, where available;
• checking the calculations of the lease liabilities and right-of-use assets;
•
reviewing disclosures in respect of iFRS 16 and comparing with the requirements of the standard.
Key observations
We have no key observations to report in respect of this key audit matter.
29GOVERNANCEVARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 INDEPENDENT AUDITOR’S REPORT TO
THE MEMBERS OF VARIOUS EATERIES PLC
continuED
Our application of materiality
When establishing our overall audit strategy, we set certain thresholds which help us to determine the nature, timing and extent of our
audit procedures. When evaluating whether the effects of misstatements, both individually and on the financial statements as a whole,
could reasonably influence the economic decisions of the users we take into account the qualitative nature and the size of the
misstatements. Based on our professional judgement, we determined materiality as follows:
Overall materiality
£354,000 (2019: £1,110,000)
Group
Parent Company
£176,000 (2019: £n/a)
Basis for determining
overall materiality
Rationale for benchmark
applied
2% of revenue (2019: 9% of loss before tax)
at its current stage of development,
revenue growth is a major driver of business
performance for the Group and a key
benchmark for stakeholders
Performance materiality
£265,000 (2019: £836,000)
75% of overall materiality
4% of net assets, reduced in order to not exceed
maximum aggregated component materiality
as this is a non-trading holding company,
net assets was selected as the most appropriate
benchmark to shareholders
£132,000 (2019: £n/a)
75% of overall materiality
Basis for determining
performance materiality
Reporting of misstatements
to the Audit Committee
Misstatements in excess of £17,700 and
misstatements below that threshold that, in our
view, warranted reporting on qualitative grounds.
Misstatements in excess of £8,800 and
misstatements below that threshold that, in our
view, warranted reporting on qualitative grounds.
An overview of the scope of our audit
the Group consists of seven non-dormant components, all of which are based in the uK.
Number of components Revenue
Total assets
Profit before tax
Full scope audit
Specific audit procedures
Total
5
2
7
100%
–%
100%
80.2%
19.8%
100%
100%
–%
100%
all audit work was undertaken by the Group audit engagement team.
30GOVERNANCEVARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 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.
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 their 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 from branches not visited by us; or
the parent company financial statements are not in agreement
with the accounting records and returns; or
•
• certain disclosures of Directors’ remuneration specified by law
are not made; or
• we have not received all the information and explanations we
require for our audit.
We have nothing to report in this regard.
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 period 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.
•
31GOVERNANCEVARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 INDEPENDENT AUDITOR’S REPORT TO
THE MEMBERS OF VARIOUS EATERIES PLC
continuED
Responsibilities of Directors
as explained more fully in the Directors’ Responsibilities Statement,
the Directors are responsible for the preparation of the financial
statements and for being satisfied that they give a true and fair
view, and for such internal control as the Directors determine
is necessary to enable the preparation of financial statements
that are free from material misstatement, whether due to fraud
or error.
in preparing the financial statements, the Directors are responsible
for assessing the Group’s and the parent company’s ability to
continue as a going concern, disclosing, as applicable, matters
related to going concern and using the going concern basis of
accounting unless the Directors either intend to liquidate the
Group or the parent company or to cease operations, or have
no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the
financial statements
our objectives are to obtain reasonable assurance about whether
the financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an
auditor’s report that includes our opinion. Reasonable assurance
is a high level of assurance, but is not a guarantee that an audit
conducted in accordance with iSas (uK) will always detect a
material misstatement when it exists. Misstatements can arise
from fraud or error and are considered material if, individually or in
the aggregate, they could reasonably be expected to influence
the economic decisions of users taken on the basis of these
financial statements.
irregularities, including fraud, are instances of non-compliance
with laws and regulations. We design procedures in line with our
responsibilities, outlined above, to detect material misstatements
in respect of irregularities, including fraud. the extent to which our
procedures are capable of detecting irregularities, including fraud,
is detailed below.
in identifying and assessing risks of material misstatement the
Group audit engagement team:
• obtained an understanding of the nature of the industry and
sector, including the legal and regulatory framework that the
Group and parent company operate in;
inquired of management, and those charged with governance,
about their own identification and assessment of the risks
of irregularities;
•
• obtained an understanding of how the Group and parent
company is complying with the legal and regulatory framework
by making inquiries of management;
• assessed the susceptibility of the Group and parent company’s
financial statements to material misstatement, including:
– obtaining an understanding of the control environment and
business performance;
– evaluating the design of the internal controls established to
mitigate risks of fraud and determining whether they have
been implemented;
– inquiring of management and those charged with
governance about any known actual, suspected or
alleged fraud;
– inspecting minutes of meetings of those charged
with governance;
– discussing matters among the audit engagement team
regarding how and where the financial statements may be
susceptible to material misstatement due to fraud, including
how fraud might occur.
32GOVERNANCEVARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 the most significant laws and regulations were determined as follows:
Legislation / Regulation
Additional audit procedures performed by the Group audit engagement team included:
UK-adopted IAS and
Companies Act 2006
Review of the financial statement disclosures and testing to supporting documentation;
completion of disclosure checklists to identify areas of non-compliance.
Tax compliance regulations
input from employment tax specialists was obtained regarding the impact of the Group’s utilisation of
the coronavirus Job Retention Scheme during the period;
Food safety and licensing
consideration of whether any matter identified during the audit required reporting to an appropriate
authority outside the entity.
iSas limit the required audit procedures to identify non-compliance with these laws and regulations
to inquiry of management and where appropriate, those charged with governance (as noted above)
and inspection of legal and regulatory correspondence, if any.
the areas that we identified as being susceptible to material misstatement due to fraud were:
Risk
Audit procedures performed by the audit engagement team:
Impairment of goodwill and
property, plant and equipment
Management override of
controls
as set out in key audit matters above.
testing the appropriateness of journal entries and other adjustments;
assessing whether the judgements made in making accounting estimates are indicative of a potential
bias; and evaluating the business rationale of any significant transactions that are unusual or outside
the normal course of business.
a further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting council’s
website at: http://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.
William Farren FCA (Senior Statutory Auditor)
For and on behalf of RSM uK audit LLp, Statutory auditor
chartered accountants
25 Farringdon Street
London
Ec4a 4aB
24 February 2021
33GOVERNANCEVARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 FinanciaL
StatEMEntS
36 Consolidated Statement of
Comprehensive Income
37 Consolidated Statement
of Financial Position
38 Parent Company Balance Sheet
39 Consolidated Statement
of Changes in Equity
40 Company Statement
of Changes in Equity
41 Consolidated Statement
of Cash Flows
42 Notes to the
Financial Statements
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FoR tHE 52 WEEKS EnDED 27 SEptEMBER 2020
Revenue
cost of sales
Gross (loss) / profit
central staff costs
impairment of intangible fixed assets
impairment of property, plant and equipment
(Loss) / profit on disposal of assets and leases
other expenses
Operating loss
Finance income
Financing costs
Loss before tax
tax
Loss for the period
Earnings per share
Basic loss per share (pence)
Diluted loss per share (pence)
52 weeks
ended
27 September
2020
£ 000
52 weeks
ended
29 September
2019
£ 000
16,469
(17,516)
(1,047)
(1,901)
(3,640)
(1,751)
(1,632)
(2,469)
(12,440)
1
(2,003)
(14,442)
–
(14,442)
25,605
(24,418)
1,187
(1,898)
(1,236)
(1,004)
117
(2,225)
(5,059)
7
(6,923)
(11,975)
–
(11,975)
(116.4)
(116.4)
(145.1)
(145.1)
note
4
14
15
12
7
7
11
13
13
the above results were derived from continuing operations.
there are no items of comprehensive income other than the loss for the period and therefore, no separate statement of comprehensive
income is presented.
36FINANCIAL STATEMENTS VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 CONSOLIDATED STATEMENT OF FINANCIAL POSITION
aS at 27 SEptEMBER 2020
Non-current assets
intangible assets
Right-of-use assets
other property, plant and equipment
Current assets
inventories
trade receivables
other receivables
cash and bank balances
Total assets
Current liabilities
trade and other payables
Borrowings
Net current assets / (liabilities)
Total assets less current liabilities
Non-current liabilities
Borrowings
provisions
Total non-current liabilities
Total liabilities
Net assets / (liabilities)
Equity
Share capital
Share premium
Merger reserve
Employee benefit trust shares reserve
Retained earnings
Total funds / (deficit) attributable to the equity shareholders of the Company
27 September
2020
£ 000
29 September
2019
£ 000
note
14
15
15
17
18
18
19
20
21
22
23
24
24
12,903
21,049
12,390
46,342
401
248
24,682
893
26,224
72,566
(10,992)
(2,402)
12,830
59,172
(31,482)
(461)
(31,943)
(45,337)
27,229
890
52,284
64,736
(5,012)
(85,669)
27,229
7,264
14,206
10,124
31,594
551
209
2,022
1,834
4,616
36,210
(8,221)
–
(3,605)
27,989
(34,369)
–
(34,369)
(42,590)
(6,380)
111
64,736
–
–
(71,227)
(6,380)
the financial statements of Various Eateries pLc (registration number: 12698869) were approved by the Board and authorised for issue on
24 February 2021. they were signed on its behalf by:
Oli Williams
Director
37FINANCIAL STATEMENTS VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020
PARENT COMPANY BALANCE SHEET
aS at 27 SEptEMBER 2020
Fixed assets
investments
Current assets
trade and other receivables
Total assets
Current liabilities
trade and other payables
Net current assets
Net assets
Capital and reserves
Share capital
Share premium
Employee benefit trust shares reserve
Retained earnings
Total funds attributable to the equity shareholders of the Company
27 September
2020
£ 000
note
16
18
9,325
39,213
39,213
48,538
20
(478)
24
24
38,735
48,060
890
52,284
(5,012)
(102)
48,060
as permitted by section 408 of the companies act 2006, the holding company’s statement of comprehensive income has not been
included in these financial statements. the loss for the period was £nil.
the financial statements of Various Eateries pLc (registration number: 12698869) were approved by the Board and authorised for issue on
24 February 2021. they were signed on its behalf by:
Oli Williams
Director
38FINANCIAL STATEMENTS VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FoR tHE 52 WEEKS EnDED 27 SEptEMBER 2020
Attributable to equity shareholders
of the Company
at 30 September 2018
capital restructure
Total transactions with owners
Loss for the period
Total comprehensive loss
At 29 September 2019
at 29 September 2019
Share-for-share exchange
Debt for equity swap
Shares issued on ipo
other shares issued
Share issue costs
Total transactions with owners
Loss for the period
Total comprehensive loss
At 27 September 2020
called-up
share
capital
£ 000
78
33
33
–
–
111
111
–
238
342
199
–
779
–
–
Share
premium
£ 000
–
64,736
64,736
–
–
64,736
64,736
(64,736)
15,250
24,658
14,285
(1,909)
(12,452)
–
–
Merger
reserve
£ 000
Employee
benefit trust
shares reserve
£ 000
–
–
–
–
–
–
–
64,736
–
–
–
–
64,736
–
–
–
–
–
–
–
–
–
–
–
–
(5,012)
–
(5,012)
–
–
Retained
earnings
£ 000
(59,252)
–
–
(11,975)
(11,975)
(71,227)
(71,227)
–
–
–
–
–
–
(14,442)
(14,442)
total
£ 000
(59,174)
64,769
64,769
(11,975)
(11,975)
(6,380)
(6,380)
–
15,488
25,000
9,472
(1,909)
48,051
(14,442)
(14,442)
890
52,284
64,736
(5,012)
(85,669)
27,229
39FINANCIAL STATEMENTS VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 COMPANY STATEMENT OF CHANGES IN EQUITY
FoR tHE 52 WEEKS EnDED 27 SEptEMBER 2020
Attributable to equity shareholders of the Company
at 26 June 2020
Share-for-share exchange
Debt for equity swap
Shares issued on ipo
other shares issued
Share issue costs
adjustment upon share-for-share exchange
Total transactions with owners
Loss for the period
Total comprehensive loss
At 27 September 2020
called-up
share
capital
£ 000
Share
premium
£ 000
Employee
benefit trust
shares reserve
£ 000
Retained
earnings
£ 000
–
111
238
342
199
–
–
890
–
–
890
–
–
15,250
24,658
14,285
(1,909)
–
52,284
–
–
–
–
–
–
(5,012)
–
–
(5,012)
–
–
–
–
–
–
–
–
(102)
(102)
–
–
total
£ 000
–
111
15,488
25,000
9,472
(1,909)
(102)
48,060
–
–
52,284
(5,012)
(102)
48,060
40FINANCIAL STATEMENTS VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 CONSOLIDATED STATEMENT OF CASH FLOWS
FoR tHE 52 WEEKS EnDED 27 SEptEMBER 2020
Cash flows from operating activities
Loss for the year
adjustments to cash flows from non-cash items:
Depreciation
impairment
Loss / (profit) on disposal and surrender of leases
Finance income
Financing costs
preference share dividends
Working capital adjustments:
Decrease / (increase) in inventories
Decrease in trade and other receivables
increase in accruals, trade and other payables
increase in provisions
Net cash flow from operating activities
Cash flows from investing activities
interest received
purchases of property, plant and equipment
purchase of intangible assets
(costs) / proceeds of disposal of property, plant and equipment
costs on issue of shares
Net cash flows from investing activities
Cash flows from financing activities
interest paid
proceeds on issue of shares
proceeds from borrowings
principal elements of lease payments
Net cash flows from financing activities
(Decrease) / increase in cash
opening cash at bank and in hand
Closing cash at bank and in hand
52 weeks
ended
27 September
2020
£ 000
52 weeks
ended
29 September
2019
£ 000
note
(14,442)
(11,975)
15
14, 15
24
21, 22
2,832
5,391
1,632
(1)
2,003
–
(2,585)
149
958
1,656
461
639
1
(5,086)
(2)
(109)
(432)
(5,628)
(841)
79
5,700
(890)
4,048
(941)
1,834
893
3,433
2,240
(117)
(7)
2,980
3,941
495
(3)
1,384
1,449
–
3,325
7
(4,363)
(10)
434
–
(3,931)
(988)
33
4,000
(2,206)
839
233
1,601
1,834
41FINANCIAL STATEMENTS VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020
NOTES TO THE FINANCIAL STATEMENTS
FoR tHE 52 WEEKS EnDED 27 SEptEMBER 2020
1 GENERAL INFORMATION
Various Eateries pLc, ‘the company’, and its subsidiaries (together ‘the Group’) are private companies limited by shares incorporated in the
united Kingdom under the companies act 2006 and are registered in England and Wales. the address of the registered office is
20 St thomas Street, London, SE1 9RS.
the Group is engaged in the operation of non-members’ clubs, restaurants, bars and lounge areas in London and the South East
of England. the parent company does not trade.
2 ACCOUNTING POLICIES
Basis of preparation
the principal accounting policies adopted in the preparation of the financial statements of the Group which have been applied
consistently to all periods presented, are set out below.
the directors (the ‘Directors’) of Various Eateries pLc are responsible for the financial statements. Judgements made by the Directors,
in the application of those accounting policies that have a significant effect on the financial statements and estimates with a significant
risk of material adjustments in the next period, are disclosed in note 3 on page 48.
the financial statements have been prepared in accordance with international accounting Standards in conformity with the
requirements of the companies act 2006.
the financial statements have been prepared on an historical cost basis. Monetary amounts in these financial statements are rounded
to the nearest whole £1,000, except where otherwise indicated.
as permitted by FRS 101, the company has taken advantage of the disclosure exemptions available under that standard in relation to
presentation of a company statement of profit or loss and cash flow statement, standards not yet effective, impairment of assets, related
party transactions and remuneration of key management personnel.
Basis of consolidation
the consolidated financial statements incorporate those of Various Eateries pLc and all of its subsidiaries (i.e. entities that the Group
controls through its power to govern the financial and operating policies so as to obtain economic benefits). all financial statements are
made up to 27 September 2020.
all of the consolidated comparative figures relate to Various Eateries Holdings Limited and its subsidiaries only, because Various Eateries
pLc was not incorporated until 26 June 2020. this is because the financial statements have been prepared under the principles of
merger accounting. the share capital shown in the comparative consolidated statement of financial position represents the share capital
of the company, even though the company was not yet formed at 29 September 2019, because merger accounting assumes that the
Group entities have been combined throughout the current and comparative periods.
all intra-Group transactions, balances and unrealised gains on transactions between Group companies are eliminated on consolidation.
unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.
Going concern
in adopting the going concern basis for preparing the financial statements for the year ended 27 September 2020, the Directors have
considered the business model and strategies, as set out on pages 12 to 13, the Group’s principal risks and uncertainties as set out on
page 16 as well as taking into account the current cash position and potential facilities.
Based on the Group’s cash flow forecasts and projections, the Board is satisfied that the Group will be able to operate within the level of
its facilities for the foreseeable future. in making this assessment, the Directors have made a specific analysis of the impact of both
covid-19 and Brexit. For this reason, the Board considers it appropriate for the Group to adopt the going concern basis
in preparing its financial statements.
Revenue
Revenue represents net invoiced sales of food and beverages excluding value added tax. Revenue is recognised when the goods have
been provided.
Rental income
Rental income from subletting right-of-use assets is recognised on a straight-line basis over the term of the relevant lease. it is netted off
against rental costs and is recognised within cost of sales.
42FINANCIAL STATEMENTS VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020
Goodwill
Goodwill is initially measured at cost (being the excess of the aggregate of the consideration transferred and the amount recognised for
non-controlling interests and any previous interest held over the net identifiable assets acquired and liabilities assumed). the company
is taking the option to not restate any balances prior to the opening balance sheet for the purpose of the financial statements. if the fair
value of the net assets acquired is in excess of the aggregate consideration transferred, the Group reassesses whether it has correctly
identified all of the assets acquired and all of the liabilities assumed and reviews the procedures used to measure the amounts to be
recognised at the acquisition date. if the reassessment still results in an excess of the fair value of net assets acquired over the aggregate
consideration transferred, then the gain is recognised in the income statement.
after initial recognition, goodwill is measured at cost less any accumulated impairment losses. the goodwill is tested annually for
impairment irrespective of whether there is an indication of impairment.
Intangible fixed assets (other than goodwill)
intangible assets acquired separately from a business combination are recognised at cost and are subsequently measured at cost less
accumulated amortisation and accumulated impairment losses. intangible assets acquired on business combinations are recognised
separately from goodwill at the acquisition date if the fair value can be measured reliably.
amortisation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives of four years on
a straight-line basis.
Property, plant and equipment
property, plant and equipment are stated at cost net of accumulated depreciation and accumulated impairment losses. cost comprises
purchase cost together with any incidental costs of acquisition.
Depreciation is provided to write down the cost less the estimated residual value of all tangible fixed assets by equal instalments over
their estimated useful economic lives on a straight-line basis. the following rates are applied:
Asset class
Right-of-use assets
Freehold property
Leasehold improvements
Furniture, fittings and equipment
Work in progress
it equipment
Depreciation method and rate
Life of lease
not depreciated
Life of lease
14.29% – 33.33% per annum
not depreciated
20% – 33.33% per annum
the estimated useful lives, residual values and depreciation method are reviewed at the end of each reporting period, with the effect of
any changes in estimate accounted for on a prospective basis. property, plant and equipment are tested for impairment if indications of
impairment are present.
Work in progress relates to capital expenditure on sites that have not started trading.
Inventories
Raw materials and consumables are valued at the lower of cost and net realisable value. cost is based on latest contracted purchase cost.
Financial instruments
the Group classifies financial instruments, or their component parts, on initial recognition as a financial asset, a financial liability or an
equity instrument in accordance with the substance of the contractual arrangement. Financial instruments are recognised on trade date
when the Group becomes a party to the contractual provisions of the instrument. Financial instruments are recognised initially at fair
value plus, in the case of a financial instrument not at fair value through profit and loss, transaction costs that are directly attributable to
the acquisition or issue of the financial instrument. Financial instruments are derecognised on the trade date when the Group is no
longer a party to the contractual provisions of the instrument.
Non-derivative financial instruments
non-derivative financial instruments comprise trade and other receivables, cash and cash equivalents, loans and borrowings and trade
and other payables. all financial instruments held are classified at amortised cost.
43FINANCIAL STATEMENTS VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 NOTES TO THE FINANCIAL STATEMENTS
FoR tHE 52 WEEKS EnDED 27 SEptEMBER 2020
continuED
2 ACCOUNTING POLICIES continuED
Non-derivative financial instruments continued
Trade and other receivables and trade and other payables
trade and other receivables are recognised initially at transaction price less attributable transaction costs. trade and other payables are
recognised initially at transaction price plus attributable transaction costs. Subsequent to initial recognition they are measured at
amortised cost using the effective interest method, less any expected credit losses in the case of trade receivables. if the arrangement
constitutes a financing transaction, for example if payment is deferred beyond normal business terms, then it is measured at the present
value of future payments discounted at a market rate of interest for a similar debt instrument.
Interest-bearing borrowings
interest-bearing borrowings are recognised initially at the present value of future payments discounted at a market rate of interest.
Subsequent to initial recognition, interest-bearing borrowings are stated at amortised cost using the effective interest method.
Cash and cash equivalents
cash and cash equivalents comprise cash balances held at bank, call deposits, cash on hand and cash in transit.
Impairments of tangible and intangible fixed assets
at each reporting end date, the Group reviews the carrying amounts of its tangible and intangible assets to determine whether there is
any 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). Where it is not possible to estimate the recoverable amount of
an individual asset, the Group estimates the recoverable amount of the cash-generating unit to which the asset belongs.
Recoverable amount is the higher of fair value less costs to sell and value in use. in assessing value in use, the estimated future cash flows
are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money
and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
if the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of
the asset (or cash-generating unit) is reduced to its recoverable amount. an impairment loss is recognised immediately in profit or loss.
Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) 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 (or cash-generating unit) in prior years. a reversal of an
impairment loss is recognised immediately in profit or loss.
Taxation
the tax expense represents the sum of the tax currently payable and deferred tax.
tax payable is based on taxable profit. taxable profit differs from net profit as reported in the consolidated statement of comprehensive
income 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. any liability for current tax is calculated using tax rates that have been enacted at the balance sheet
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, and is accounted for using the balance
sheet liability method. Deferred tax liabilities are generally recognised for all taxable temporary differences and deferred tax assets are
recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be
utilised. Such assets and liabilities are not recognised if the temporary difference arises from the initial recognition of goodwill or from the
initial recognition (other than in a business combination) of other assets and liabilities in a transaction that affects neither the taxable
profit nor the accounting profit. the carrying amount of deferred tax assets is reviewed at each balance sheet 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 period when the liability is settled or the asset is realised based
on tax laws and rates that have been enacted or substantively enacted at the balance sheet date. Deferred tax is charged or credited in
the consolidated profit and loss account, except when it relates to items charged or credited in other comprehensive income, in which
case the deferred tax is also dealt with in other comprehensive income.
the measurement of deferred tax liabilities and assets reflects the tax consequences that would follow from the manner in which the
company expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities.
44FINANCIAL STATEMENTS VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax
liabilities and when they relate to income taxes levied by the same taxation authority and the company intends to settle its current tax
assets and liabilities on a net basis.
current and deferred tax are recognised in the consolidated profit or loss, except when they relate to items that are recognised in other
comprehensive income or directly in equity, in which case, the current and deferred tax are also recognised in other comprehensive
income or directly in equity respectively.
Employee benefits
Post-retirement benefits
the Group operates defined contribution plans for its employees. a defined contribution plan is a post-employment benefit plan under
which the Group pays fixed contributions into a separate entity and will have no legal or constructive obligation to pay further amounts.
obligations for contributions to defined contribution pension plans are recognised as an expense in the periods during which services are
rendered by employees.
Termination benefits
termination benefits are recognised immediately as an expense when the Group is demonstrably committed to terminate the
employment of an employee or to provide termination benefits.
Leases
the Group leases a number of properties in various locations around the uK from which it operates.
all leases are accounted for by recognising a right-of-use asset and a lease liability except for:
• Leases of low-value assets; and
• Leases with a duration of 12 months or less.
Lease liabilities are measured at the present value of the contractual payments due to the lessor over the lease term, with the discount
rate determined by reference to the rate inherent in the lease unless (as is typically the case) this is not readily determinable, in which
case the Group’s incremental borrowing rate on commencement of the lease is used. this is 4.5% (2019: 4.5%). Variable lease payments
are only included in the measurement of the lease liability if they depend on an index or rate. in such cases, the initial measurement of
the lease liability assumes the variable element will remain unchanged throughout the lease term. other variable lease payments, such
as those linked to turnover, are expensed in the period to which they relate.
on initial recognition, the carrying value of the lease liability also includes:
• amounts expected to be payable under any residual value guarantee;
• the exercise price of any purchase option granted in favour of the Group if it is reasonably certain to exercise that option;
• any penalties payable for terminating the lease, if the term of the lease has been estimated on the basis of a termination option
being exercised.
Right-of-use assets are initially measured at the amount of the lease liability, reduced for any lease incentives received, and increased for:
• Lease payments made at or before commencement of the lease;
•
• the amount of any provision recognised where the Group is contractually required to dismantle, remove or restore the leased asset
initial direct costs incurred; and
(typically leasehold dilapidations).
Subsequent to initial measurement lease liabilities increase as a result of interest charged at a constant rate on the balance outstanding
and are reduced for lease payments made. Right-of-use assets are depreciated on a straight-line basis over the remaining term of the
lease or over the remaining economic life of the asset if, rarely, this is judged to be shorter than the lease term. Right-of-use assets are
tested for impairment if indications of impairment are present.
When the Group revises its estimate of the term of any lease (because, for example, it reassesses the probability of a lessee extension or
termination option being exercised), it adjusts the carrying amount of the lease liability to reflect the payments to be made over the
revised term, which are discounted at the same discount rate that applied on lease commencement. the carrying value of lease liabilities
is similarly revised when the variable element of future lease payments dependent on a rate or index is revised. in both cases an
equivalent adjustment is made to the carrying value of the right-of-use asset, with the revised carrying amount being depreciated over
the remaining (revised) lease term.
45FINANCIAL STATEMENTS VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 NOTES TO THE FINANCIAL STATEMENTS
FoR tHE 52 WEEKS EnDED 27 SEptEMBER 2020
continuED
2 ACCOUNTING POLICIES continuED
Leases continued
Lease modifications change the scope of the lease or change the consideration for the lease by comparison with that detailed in the
original terms and conditions of the contract. if the modifications, in substance, mean that the original lease has been terminated and a
new lease created, then the revised terms are accounted for as a new lease. Where modifications do not need to be accounted for as a
separate lease, the amount recognised for the lease liability and the right-of-use asset is revisited to reflect the updated terms and
conditions of the contract.
the transition model applied in the 2019 financial statements was the full retrospective approach, recalculated as at the opening position
of the 2017 financial period as opposed to the inception dates of the individual leases.
Financing income and expenses
Financing expenses comprise interest payable, finance charges on shares classified as liabilities and finance leases recognised
in profit or loss using the effective interest method, and net foreign exchange losses that are recognised in the statement of
comprehensive income.
Financing income includes interest receivable on funds invested.
interest income and interest payable are recognised in the statement of comprehensive income as they accrue, using the effective
interest method.
Investments
in the separate accounts of the company, interests in subsidiaries are initially measured at cost and subsequently measured at cost less
any accumulated impairment losses. interests in subsidiaries are assessed for impairment at each reporting date. any impairments losses
or reversals of impairment losses are recognised immediately in profit or loss.
Employment benefit trust shares
under the terms of the Joint Share ownership plan (‘JSop’), the company issued certain shares to an employee benefit trust, paid for
through the issuance of a loan to the trust from the Group. the award of shares under the JSop is conditional upon certain vesting
criteria, as outlined in note 27. the Group presents the conditional shares as an adjustment to its own equity at the reporting date
through the employee benefit trust shares reserve, until the point that the shares are awarded, and cease to be conditional awards of
shares.
Government grants
During the period ended 27 September 2020, the Group has received grants from the uK Government in relation to the coronavirus Job
Retention Scheme and business rates relief. the income from these grants has been offset against the expense to which they relate.
Standards issued but not yet effective:
the following standards and interpretations relevant to the Group are in issue but are not yet effective and have not been applied in the
financial statements. in some cases these standards and guidance have not been endorsed for use in the united Kingdom.
Standard
Effective date, annual period beginning on or after
conceptual Framework and amendments to References to the
conceptual Framework in iFRS Standards
amendments to iFRS 3 Business combinations
amendments to iaS 1 and iaS 8: Definition of Material
interest Rate Benchmark Reform: amendments to iFRS 9, iaS 39 and iFRS 7
1 January 2020
1 January 2020
1 January 2020
1 January 2020
the Group has not yet assessed the impact of these new or amended accounting standards and interpretations.
46FINANCIAL STATEMENTS VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 3 CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY
the preparation of the financial statements requires the Directors to make estimates and judgements that affect the reported amounts
of assets, liabilities, costs and revenue. actual results could differ from these estimates. information about such judgements and estimates
is contained in individual accounting policies. the judgements, estimates and associated assumptions are based on historical experience
and other factors that are considered to be relevant.
the resulting accounting estimates will, by definition, seldom equal the related actual results. the estimates and assumptions that have a
significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are
addressed below:
Key judgement – fair value of separable intangible assets in business combinations
the Group’s policies require that a fair value be attributed to the assets and liabilities of an acquired business, including internally
developed assets that may not be recognised by the acquired business at the date of acquisition. the Directors use their judgement to
identify the separate intangible assets and then determine a fair value for each based upon the nature of the asset, future potential and
other relevant factors.
Key judgement – determining the rate used to discount lease payments
at the commencement date of property leases the lease liability is calculated by discounting the lease payments. the discount rate used
should be the interest rate implicit in the lease. However, if that rate cannot be readily determined, which is generally the case for
property leases, the lessee’s incremental borrowing rate is used, being the rate that the individual lessee would have to pay to borrow the
funds necessary to obtain an asset of similar value to the right-of-use asset in a similar economic environment with similar terms, security
and conditions. the discount rate applied to the Group’s leases under the portfolio approach is 4.5%. a 0.5% increase in the discount rate
to 5% results in a decrease in net present value of the total lease liability of £731,000 at 27 September 2020 (2019: £500,000). a 0.5%
decrease in discount rate to 4% results in an increase in the net present value of the total lease liability of £771,000 at 27 September 2020
(2019: £530,000, see notes 20 and 22).
Key estimate – impairment of goodwill, other intangibles and property, plant and equipment
Determining whether goodwill, other intangibles and tangible fixed assets are impaired requires an estimation of the recoverable
amount of the cash-generating units (‘cGus’) to which goodwill, other intangibles and tangible fixed assets have been allocated. the
value-in-use calculation requires estimation of future cash flows expected to arise from the cash-generating unit and a suitable
discount rate in order to calculate present value. Details of cash-generating units as well as further information about the assumptions
made are disclosed in notes 14 and 15.
4 REVENUE
an analysis of the Group’s total revenue (including sublease rental income shown within cost of sales) which all originates in the uK
is as follows:
Sale of goods and services
Sub-let rental income
52 weeks
ended
27 September
2020
£ 000
52 weeks
ended
29 September
2019
£ 000
16,469
55
25,605
81
16,524
25,686
5 SEGMENTAL REPORTING
iFRS 8 ‘operating Segments’ requires operating segments to be based on the Group’s internal reporting to its chief operating Decision
Maker (‘coDM’). the coDM is regarded as the chief Executive officer together with other Board Members who receive financial
information at a site-by-site level. During the period ended 27 September 2020, the Group traded in one operating segment (operating
non-members’ clubs and restaurants, ’Restaurant Segment’). Economic indicators assessed in determining that all sites in the
operating segment share similar economic characteristics include expected future financial performance, operating and competitive
risks and return on investment.
two hotel operating companies were acquired on 15 September 2020 (see note 6) and, although the results for the acquired businesses
have not been consolidated into the Group results for the period ended 27 September 2020, the acquired businesses do represent a
separate operating segment (‘Hotel Segment’) for asset and liability disclosure purposes as at the reporting date (see note 6).
47FINANCIAL STATEMENTS VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 NOTES TO THE FINANCIAL STATEMENTS
FoR tHE 52 WEEKS EnDED 27 SEptEMBER 2020
continuED
6 BUSINESS COMBINATIONS
on 15 September 2020, the Group acquired 100% of the equity instruments of Rare Bird Hotels at Sonning Limited (‘RBH Sonning’) and
Rare Bird Hotels at Streatley Limited (‘RBH Streatley’), thereby obtaining control of both companies. the companies were incorporated in
2020 for the purpose of acquiring the trade and certain assets of the Great House at Sonning Limited and Rare Bird Hotels Limited
respectively, which are related parties of the Group (see note 28). the acquisitions were made to bring the full operations of each of the
hotel locations, where coppa club sites are based, into the Group prior to ipo.
Fair value of consideration transferred
amount settled via equity issue from the company
Recognised amounts of identifiable net assets
Right-of-use assets (note 15)
other property, plant and equipment (note 15)
intangible assets (note 14)
total non-current assets
inventories
trade and other receivables
cash and bank balances
trade and other payables
Lease liabilities
Identifiable net (liabilities) / assets
Goodwill on acquisition
RBH
Sonning
£ 000
RBH
Streatley
£ 000
2,329
6,987
5,285
169
125
5,579
1
212
110
(626)
(5,309)
6,246
325
125
6,696
16
420
79
(615)
(6,274)
(33)
322
2,362
6,665
the acquisitions were settled via issue of equity from the company, 3,174,603 and 9,523,809 ordinary shares for RBH Sonning and RBH
Streatley respectively (see also note 24).
the Group assessed the fair value of identifiable intangible assets as £250,000 relating to the Rare Bird Hotels brand name, split evenly
between the acquired businesses. the goodwill of £9,027,000 arising from the acquisitions consists primarily of growth expectations,
expected future profitability, and expected cost synergies. Goodwill has been allocated to the hotel segment.
Results for the acquired businesses have not been consolidated into the Group results for the period ended 27 September 2020 as the
results are not material to the Group’s results for the period due to the proximity of acquisition date to the reporting date. assets and
liabilities have been consolidated into the consolidated statement of financial position as at 27 September 2020.
48FINANCIAL STATEMENTS VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 7 FINANCE INCOME / FINANCING COSTS
interest income on bank deposits
Total finance income
Dividends on preference shares
interest on bank overdrafts and borrowings
Lease liability interest
Foreign exchange loss
Total financing costs
8 AUDITOR’S REMUNERATION
audit of the financial statements
Other fees payable to auditor
taxation compliance services
Services in relation to initial public offering
audit fees for the 52 weeks ended 27 September 2020 includes £23,000 in respect of the 2019 audit.
9 STAFF NUMBERS AND COSTS
the average monthly number of employees (including Directors) was:
operational staff
52 weeks
ended
27 September
2020
£ 000
52 weeks
ended
29 September
2019
£ 000
1
1
–
1,348
654
1
2,003
7
7
3,941
2,239
741
2
6,923
52 weeks
ended
27 September
2020
£ 000
52 weeks
ended
29 September
2019
£ 000
100
–
115
45
11
–
52 weeks
ended
27 September
2020
No.
52 weeks
ended
29 September
2019
no.
506
542
the average monthly number of employees (being Directors) of the company since incorporation was three.
their aggregate remuneration comprised:
Wages and salaries
Social security costs
other pension costs (see note 25)
other employee expense
Grant income – coronavirus Job Retention Scheme (‘cJRS’)
52 weeks
ended
27 September
2020
£ 000
52 weeks
ended
29 September
2019
£ 000
10,080
777
178
83
(2,846)
9,543
691
160
61
–
8,272
10,455
49FINANCIAL STATEMENTS VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 NOTES TO THE FINANCIAL STATEMENTS
FoR tHE 52 WEEKS EnDED 27 SEptEMBER 2020
continuED
10 DIRECTORS’ REMUNERATION
the Directors’ remuneration for the period in respect of service to the Group was as follows:
Remuneration
Employer pension contribution
in respect of the highest paid Director:
Remuneration
Employer pension contribution
11 TAX
corporation tax
Total current income tax
tax expense in the statement of comprehensive income
52 weeks
ended
27 September
2020
£ 000
52 weeks
ended
29 September
2019
£ 000
324
7
331
149
6
155
52 weeks
ended
27 September
2020
£ 000
52 weeks
ended
29 September
2019
£ 000
150
4
154
137
6
143
52 weeks
ended
27 September
2020
£ 000
52 weeks
ended
29 September
2019
£ 000
–
–
–
–
–
–
corporation tax is calculated at 19% (2019: 19%) of the estimated taxable loss for the period.
the charge for the period can be reconciled to the loss in the statement of comprehensive income as follows:
Loss before tax
corporation tax at standard rate 19% (2019: 19%)
Difference between depreciation and capital allowances
Expenses not deductible
Remeasurement of deferred tax for changes in tax rate
Deferred tax not recognised
timing differences not recognised
total tax charge
52 weeks
ended
27 September
2020
£ 000
52 weeks
ended
29 September
2019
£ 000
(14,442)
(11,975)
(2,744)
992
405
(676)
2,023
–
–
(2,275)
(222)
1,227
–
1,131
139
–
no account has been taken of the potential deferred tax asset of £9,885,000 (2019: £5,791,000) calculated at 19% (2019: 17%) and
representing losses carried forward and short-term timing differences, owing to the uncertainty over the timing and utilisation
of the losses available.
50FINANCIAL STATEMENTS VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 12 OTHER EXPENSES
other central costs
aGa provision (note 23)
ipo-related costs
Depreciation of property, plant and equipment (note 15)
Restructuring costs
52 weeks
ended
27 September
2020
£ 000
52 weeks
ended
29 September
2019
£ 000
1,321
461
285
235
167
2,469
1,646
–
–
257
322
2,225
13 EARNINGS PER SHARE
Basic loss per share is calculated by dividing the profit attributable to equity shareholders by the weighted average number of shares
outstanding during the year. there were no potentially dilutive ordinary shares outstanding as at the period ended 27 September 2020
and 29 September 2019.
Loss for the year after tax (£000)
Basic and diluted weighted average number of shares
Basic loss per share (pence)
Diluted loss per share (pence)
14 INTANGIBLE ASSETS
Group
Cost or valuation
at 29 September 2019
additions
acquired through business combination
at 27 September 2020
Amortisation
at 29 September 2019
impairment
at 27 September 2020
Carrying amount 27 September 2020
Cost or valuation
at 30 September 2018
additions
at 29 September 2019
Amortisation
at 30 September 2018
impairment
at 29 September 2019
Carrying amount 29 September 2019
27 September
2020
29 September
2019
(14,442)
12,403,859
(116.4)
(116.4)
(11,975)
8,251,030
(145.1)
(145.1)
Brand
£ 000
Goodwill
£ 000
Trademarks,
patents &
licences
£ 000
2,662
–
250
2,912
2,662
–
2,662
250
Brand
£ 000
2,662
–
2,662
2,662
–
2,662
–
16,992
–
9,027
26,019
9,751
3,640
13,391
12,628
Goodwill
£ 000
16,992
–
16,992
8,515
1,236
9,751
7,241
23
2
–
25
–
–
–
25
trademarks,
patents &
licenses
£ 000
13
10
23
–
–
–
23
Total
£ 000
19,677
2
9,277
28,956
12,413
3,640
16,053
12,903
total
£ 000
19,667
10
19,677
11,177
1,236
12,413
7,264
51FINANCIAL STATEMENTS VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 NOTES TO THE FINANCIAL STATEMENTS
FoR tHE 52 WEEKS EnDED 27 SEptEMBER 2020
continuED
14 INTANGIBLE ASSETS continuED
Brand relates to registered brand names and is amortised over an estimated useful economic life of four years. the brand names
acquired through business combination have not been amortised during the period ended 27 September 2020 due to the proximity of
acquisition date to the reporting date as the impact is immaterial.
Goodwill is not amortised, but an impairment test is performed annually by comparing the carrying amount of the goodwill to its
recoverable amount. the recoverable amount is represented by the greater of the individual cGu’s fair value less costs of disposal
and its value-in-use.
the brought-forward goodwill balance relates to tavolino Riverside (£4,032,000), Strada Southbank (£3,147,000), and Strada Dockside
(£62,000). these three cGus are included in the restaurant operating segment.
the goodwill acquired through business combination relates to the acquisition of Rare Bird Hotels at Sonning Limited and Rare Bird
Hotels at Streatley Limited in September 2020. these two cGus make up the hotel operating segment.
Restaurant segment
the key assumptions for the value-in-use calculations are those regarding the discount rate, trading forecasts and growth rates. a pre-tax
discount rate of 12.8% was used (2019: 10%), based on the Group’s Wacc and comparable businesses in the sector. cash flows in line
with five-year forecasts were used, which incorporate a reasonably foreseen, as at 27 September 2020, future impact of the covid-19
pandemic and assumptions concerning the rate at which site-level cash flows will recover. cash flows beyond the forecast period are
extended out to the end of the lease terms at a 2% growth rate. the key assumption for the fair value calculations is the multiple applied
to site EBitDa. a multiple of 5 times site EBitDa was used (2019: 5 times) based on expected market value if the sites were to be sold as
individual trading businesses.
impairment testing resulted in the reduction of goodwill to its recoverable amount, being value-in-use, at 27 September 2020, with the
full charge recognised against the restaurant segment. the split of the charge between the cGus and resulting carrying values,
respectively, are: tavolino Riverside (£1,424,000) and £2,609,000; Strada Southbank (£2,154,000) and £992,000; and Strada Dockside
(£62,000) and £nil.
Given the global pandemic and its impact on the uK hospitality sector there is particular sensitivity to the forecasts prepared in
connection with the impairment review as at 27 September 2020. the estimate of recoverable amount for the restaurant segment is
particularly sensitive to the discount rate and trading forecast assumptions. if the discount rate used is increased by 2%, a further
impairment loss of £654,000 for the period ended 27 September 2020 would have to be recognised against goodwill (2019: £425,000).
if the forecast five-year total EBitDa is reduced by 10%, a further impairment loss of £856,000 for the period ended 27 September 2020
would have to be recognised against goodwill. Management is not currently aware of any other reasonably possible changes to key
assumptions that would cause a unit’s carrying amount to exceed its recoverable amount.
Hotel segment
the key assumptions for the value-in-use calculations are those regarding the discount rate, trading forecasts and growth rates. a pre-tax
discount rate of 12.8% was used (2019: 10%), based on the Group’s Wacc and comparable businesses in the sector. cash flows in line
with five-year forecasts were used, which incorporate a reasonably foreseen, as at 27 September 2020, future impact of the covid-19
pandemic and assumptions concerning the rate at which site-level cash flows will recover. cash flows beyond the forecast period are
extended at a terminal growth rate of 2%. the key assumption for the fair value calculations is the multiple applied to site EBitDa. a
multiple of 9 times site EBitDa was used based on expected market value if the entities were to be sold as individual trading
businesses.
impairment testing resulted in no requirement to reduce the carrying value of goodwill in 2020 as the recoverable amounts of the cGus,
based on value-in-use estimates, were £14,469,000 for Rare Bird Hotels at Sonning Limited and £24,184,000 for Rare Bird Hotels at
Streatley Limited. the headroom of recoverable amount over goodwill is £12,328,000 and £18,345,000 respectively.
Given the global pandemic and its impact on the uK hospitality sector there is particular sensitivity to the forecasts prepared in
connection with the impairment review as at 27 September 2020. the estimate of recoverable amount for the hotel segment is sensitive
to the discount rate, trading forecast assumptions and terminal growth rate. if the discount rate used is increased by 2%, the forecast
five-year total EBitDa is reduced by 10%, and the terminal growth rate reduced by 1%, the headroom reduces to £8,505,000 for Rare
Bird Hotels at Sonning Limited and £11,940,000 for Rare Bird Hotels at Streatley Limited. Management is not currently aware of any
other reasonably possible changes to key assumptions that would cause a unit’s carrying amount to exceed its recoverable amount.
Company
the company has no intangible fixed assets.
52FINANCIAL STATEMENTS VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 15 PROPERTY, PLANT AND EQUIPMENT
Group
Cost or valuation
at 29 September 2019
additions
acquired through business
combination
Disposals
transfers
at 27 September 2020
Depreciation
at 29 September 2019
charge for the period
Eliminated on disposal
impairment loss
at 27 September 2020
Carrying amount
27 September 2020
Right-of-use
assets
£ 000
Freehold
property
£ 000
Leasehold
improvements
£ 000
Furniture,
fittings and
equipment
£ 000
Work in
progress
£ 000
IT
equipment
£ 000
19,038
707
11,532
(4,370)
–
26,907
4,832
1,272
(1,862)
1,616
5,858
–
1,795
–
–
–
1,795
–
–
–
–
–
8,499
72
–
(2,383)
871
7,059
1,609
431
(1,510)
135
665
4,972
548
403
(1,909)
537
4,551
2,550
902
(1,321)
–
2,131
105
2,605
–
(102)
(1,437)
1,171
–
–
–
–
–
1,311
66
90
(138)
29
1,358
604
227
(83)
–
748
Total
£ 000
33,925
5,793
12,025
(8,902)
–
42,841
9,595
2,832
(4,776)
1,751
9,402
21,049
1,795
6,394
2,420
1,171
610
33,439
Cost or valuation
at 30 September 2018
additions
Disposals
transfers
at 29 September 2019
Depreciation
at 30 September 2018
charge for the period
Eliminated on disposal
impairment loss
at 29 September 2019
Carrying amount
29 September 2019
Right-of-use
assets
£ 000
Leasehold
improvements
£ 000
Furniture,
fittings and
equipment
£ 000
Work in
progress
£ 000
it
equipment
£ 000
20,205
1,722
(2,889)
–
19,038
5,882
1,755
(2,889)
84
4,832
7,733
1,178
(2,230)
1,818
8,499
2,340
557
(2,208)
920
1,609
5,022
795
(1,254)
409
4,972
2,666
897
(1,013)
–
2,550
285
2,166
(26)
(2,320)
105
15
–
(15)
–
–
1,115
224
(121)
93
1,311
460
224
(80)
–
604
total
£ 000
34,360
6,085
(6,520)
–
33,925
11,363
3,433
(6,205)
1,004
9,595
14,206
6,890
2,422
105
707
24,330
53FINANCIAL STATEMENTS VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 NOTES TO THE FINANCIAL STATEMENTS
FoR tHE 52 WEEKS EnDED 27 SEptEMBER 2020
continuED
15 PROPERTY, PLANT AND EQUIPMENT continuED
the Group’s leasehold premises and improvements are stated at cost, being the fair value at the date of acquisition, plus any additions at
cost less any subsequent accumulated depreciation. Work in progress relates to capital expenditure on sites that have not started trading.
Depreciation is charged to cost of sales in the statement of comprehensive income for property, plant and equipment in use at the
trading leasehold premises. Depreciation on property, plant and equipment used by central functions is charged to other expenses in
the statement of comprehensive income.
the assets acquired through business combination comprise the fair value of the property, plant and equipment of Rare Bird Hotels at
Sonning Limited and Rare Bird Hotels at Streatley Limited, acquired by the Group in September 2020.
Rental income from subletting right-of-use assets is recognised on a straight-line basis over the term of the relevant lease. it is netted off
against rental costs and is recognised within cost of sales (2019: £81,000, 2020: £55,000).
the Group has determined that each site in the restaurant operating segment, and each of the companies in the hotel operating
segment are separate cGus for impairment testing purposes. Each cGu is tested for impairment at the balance sheet date if there exists
at that date any indicators of impairment. Losses incurred by the Group pre covid-19 as well as the ongoing covid-19 pandemic are
considered indicators of potential impairment; accordingly all cGus have been tested for impairment by comparing the carrying
amount of the assets to the recoverable amount. the recoverable amount is represented by the greater of the individual cGu’s fair value
less costs of disposal and its value-in-use.
Restaurant segment
the key assumptions for the value-in-use calculations are those regarding the discount rate, trading forecasts and growth rates. a pre-tax
discount rate of 12.8% was used (2019: 10%), based on the Group’s Wacc and comparable businesses in the sector. cash flows in line
with five-year forecasts were used, which incorporate an impact of the covid-19 pandemic and assumptions concerning the rate at
which site-level cash flows will recover. cash flows beyond the forecast period are extended out to the end of the lease terms at a 2%
growth rate. the key assumption for the fair value calculations is the multiple applied to site EBitDa. a multiple of 5 times site EBitDa
was used (2019: 5 times) based on expected market value if the sites were to be sold as individual trading businesses.
impairment testing resulted in the reduction of carrying amount to recoverable amount, being value-in-use, for three cGus in 2020,
with the full charge recognised against the restaurant segment. the split of the charge between the cGus and the asset classes are: 31
Below Marylebone £378,000 against right-of-use assets and leasehold improvements; coppa club Brighton £439,000 against right-of-
use assets; and coppa club Maidenhead £935,000 against right-of-use assets.
the estimate of recoverable amount for the restaurant segment is particularly sensitive to the discount rate and trading forecast
assumptions. if the discount rate used is increased by 2%, a further impairment loss of £450,000 for the period ended 27 September
2020 would have to be recognised against right-of-use assets. if the forecast five-year total EBitDa is reduced by 10%, a further
impairment loss of £376,000 for the period ended 27 September 2020 would have to be recognised against right-of-use assets.
Management is not currently aware of any other reasonably possible changes to key assumptions that would cause a unit’s carrying
amount to exceed its recoverable amount.
Hotel segment
as a result of the headroom identified during the goodwill impairment testing of the hotel operating segment (see note 14), no
impairment charge is required in respect of the hotel segment.
Company
the company has no property, plant and equipment.
54FINANCIAL STATEMENTS VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 16 INVESTMENTS
Group subsidiaries
name of subsidiary
Various Eateries
Holdings Limited*
principal activity
Holding company
Rare Bird Hotels at
Sonning Limited*
Hotels and similar
accommodation
Rare Bird Hotels at
Streatley Limited*
Hotels and similar
accommodation
VEL property
Holdings Limited
Buying and selling of
own real estate
Scp Sugar Limited
Holding company
Various Eateries
trading Limited
Licensed restaurants
coppa club Limited
Dormant
coppa Limited
Dormant
country of incorporation
and registered office
united Kingdom
20 St thomas Street,
London, SE1 9RS
united Kingdom
20 St thomas Street,
London, SE1 9RS
united Kingdom
20 St thomas Street,
London, SE1 9RS
united Kingdom
20 St thomas Street,
London, SE1 9RS
united Kingdom
20 St thomas Street,
London, SE1 9RS
united Kingdom
20 St thomas Street,
London, SE1 9RS
united Kingdom
20 St thomas Street,
London, SE1 9RS
united Kingdom
20 St thomas Street,
London, SE1 9RS
* indicates direct investment of the company; other companies are held by direct subsidiaries.
Summary of investments in subsidiaries
at start of financial period
additions
at end of financial period
proportion of ownership interest
and voting rights held
by the Group
2020
100%
100%
100%
100%
2019
100%
–
–
–
100%
100%
100%
100%
100%
100%
100%
–
27 September
2020
£ 000
–
9,325
9,325
the additions in the period reflect the share-for-share exchange by which Various Eateries pLc acquired the entire issued share capital of
Various Eateries Holdings Limited on 27 august 2020 (£9,000), plus the acquisition of Rare Bird Hotels at Sonning Limited and Rare Bird
Hotels at Streatley Limited on 15 September 2020 (£9,316,000, see note 6).
55FINANCIAL STATEMENTS VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 NOTES TO THE FINANCIAL STATEMENTS
FoR tHE 52 WEEKS EnDED 27 SEptEMBER 2020
continuED
17 INVENTORIES
Food and drinks
consumables
inventories recognised as an expense in the period totalled £4,509,000 (2019: £7,099,000).
18 TRADE AND OTHER RECEIVABLES
trade receivables
Receivables from subsidiaries
prepayments
other receivables
Group
company
27 September
2020
£ 000
29 September
2019
£ 000
27 September
2020
£ 000
178
223
401
330
221
551
–
–
–
Group
company
27 September
2020
£ 000
29 September
2019
£ 000
27 September
2020
£ 000
248
–
317
24,365
24,930
209
–
–
15,567
1,065
957
2,231
–
23,646
39,213
all of the trade receivables were non-interest-bearing, receivable under normal commercial terms, and the Directors do not consider
there to be any material expected credit loss. the Directors consider that the carrying value of trade and other receivables approximates
to their fair value.
Receivables from subsidiaries includes a balance created by the upwards novation of £15,488,000 of the related party borrowings
balance as part of the capital restructure in the period (see note 22 and note 24).
other receivables includes £23,523,000 in respect of net ipo share issue proceeds.
19 CASH AND BANK BALANCES
cash and bank balances
Group
company
27 September
2020
£ 000
29 September
2019
£ 000
27 September
2020
£ 000
893
1,834
–
56FINANCIAL STATEMENTS VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 20 TRADE AND OTHER PAYABLES
trade payables
payables to subsidiaries
accrued expenses
Social security and other taxes
other payables
Lease liabilities due in less than one year
21 LOANS AND BORROWINGS
Borrowings from related parties
Group
company
27 September
2020
£ 000
29 September
2019
£ 000
27 September
2020
£ 000
2,621
1,783
–
3,813
988
1,186
2,384
10,992
–
2,704
1,184
767
1,783
8,221
–
432
46
–
–
–
478
Group
company
27 September
2020
£ 000
29 September
2019
£ 000
27 September
2020
£ 000
2,402
–
–
Borrowings from related parties classed as payable within 12 months represents a deep discounted bond instrument issued by VEL
property Holdings Limited on 15 January 2020. the subscription amount was £2,300,000, the nominal value £2,438,000, and the final
redemption date is 14 January 2021. the discount is recognised on a straight-line basis between subscription and redemption date,
resulting in £102,000 of accrued financing costs as at the reporting date.
22 NON-CURRENT LOANS AND BORROWINGS
Borrowings from related parties
Lease liabilities due after more than one year
Group
company
27 September
2020
£ 000
29 September
2019
£ 000
27 September
2020
£ 000
10,000
21,082
21,482
13,287
31,482
34,369
–
–
–
the borrowings from related parties balance as at 27 September 2020 is made up of a deep discounted bond instrument and the
existing august 2019 loan agreement. the deep discounted bond was issued in September 2020 as part of a capital restructure
(see note 24), with a subscription price of £8,962,000, a nominal value of £9,515,000, and a term of 19 months. the balance of £1,038,000
(2019: £21,082,000) under the august 2019 loan agreement matures in august 2022, bears cash-settled interest at 3.75% above LiBoR
(2019: cash-settled interest at 3.75% above LiBoR on £11,000,000 of the principal and payment-in-kind interest at 6% above LiBoR on
£10,000,000 of the principal), and contains an EBitDa multiple covenant that should have been first tested in September 2020 under
the original agreement and has been waived until april 2022.
the loans and borrowings classified as financial instruments are disclosed in note 26.
the Group’s exposure to market and liquidity risk in respect of loans and borrowings is disclosed in the financial instruments note.
57FINANCIAL STATEMENTS VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 NOTES TO THE FINANCIAL STATEMENTS
FoR tHE 52 WEEKS EnDED 27 SEptEMBER 2020
continuED
23 PROVISIONS FOR LIABILITIES
Group
authorised Guarantee agreements (‘aGas’)
at 30 September 2018 and 29 September 2019
provision
At 27 September 2020
£ 000
–
461
461
the provision relates to the annual rental cost of four previously operated sites that have been disposed of via assignment of lease and
include authorised Guarantee agreements (‘aGas’) as part of the assignment arrangement (see also note 31).
24 SHARE CAPITAL AND SHARE PREMIUM
Authorised, allotted, called-up and fully paid shares
ordinary shares of £0.01 each
Movements in ordinary share capital
at incorporation
Share subdivision
Date
26 June 2020
27 august 2020
Share-for-share exchange
27 august 2020
Share conversion
18 September 2020
issue of shares on ipo
25 September 2020
issue of other shares
18 September 2020
Balance
27 September 2020
27 September 2020
29 September 2019
No. 000
89,008
£ 000
890
no. 000
11,111
£ 000
111
Shares nominal value
£ 000
1
99
11,111,011
23,809,522
34,246,576
19,841,268
89,008,477
£1.00
£0.01
£0.01
£0.01
£0.01
£0.01
–
–
111
238
342
198
890
Ordinary shares
ordinary shares entitle the holder to participate in dividends and the proceeds on the winding up of the company in proportion to the
number of and amounts paid on the shares held. the fully paid ordinary shares have a par value of £0.01 and the company does not have
a limited amount of authorised capital.
Share-for-share exchange
the company was incorporated on 26 June 2020 with one ordinary share of £1.00. on 27 august 2020 the shareholders of
Various Eateries Holdings Limited (‘VEHL’) exchanged their ordinary shares in VEHL for ordinary shares in the company.
Share conversion
on 18 September 2020, the Group carried out a pre-aiM float capital restructure in the form of a debt-for-equity swap whereby deep
discounted bond instruments issued by Various Eateries trading Limited in 2020 and a proportion of the balance under the august 2019
loan agreement were repaid via equity issued by the company. the reduction of debt was achieved by way of issue of a new deep
discounted bond instrument by Various Eateries trading Limited (see note 22) and successive novation of £15,488,000 of the balance
upwards through the Group. the intercompany balance created by this novation makes up a proportion of the receivables from
subsidiaries disclosed in note 18.
Issues of shares
the shares issued on 18 September 2020 includes 12,698,412 shares issued as consideration for the purchase of the entire issued ordinary
share capital of Rare Bird Hotels at Sonning Limited and Rare Bird Hotels at Streatley Limited (see note 6), and 5,809,523 shares issued
under a share-based payment scheme (see note 27).
the shares issued on 25 September 2020 raised gross proceeds of £25,000,000. net proceeds were received post year end and are
included in other receivables as at 27 September 2020 (see note 18).
58FINANCIAL STATEMENTS VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 Employee benefit trust shares reserve
the Group presents these shares as an adjustment to own equity at the period end date through the employee benefit trust shares
reserve, until the point that the shares are awarded, and cease to be conditional awards of shares. the award of shares is conditional
upon certain vesting criteria, as outlined in note 27.
25 RETIREMENT BENEFIT SCHEMES
Group personal pension scheme
the Group operates group personal pension schemes for all qualifying employees. the assets of the schemes are held separately from
those of the Group.
the total cost charged to income of £178,000 (2019: £160,000) represents contributions payable to these schemes by the Group at rates
specified in the rules of the schemes. as at 27 September 2020, contributions of £23,000 (2019: £27,000) due in respect of the current
reporting period had not been paid over to the schemes.
26 FINANCIAL INSTRUMENTS
Group
Financial assets – loans and receivables
cash at bank and in hand
trade and other receivables
27 September
2020
£ 000
29 September
2019
£ 000
893
24,613
25,506
1,834
1,166
3,000
Valuation methods and assumptions
trade receivables are all due for settlement in less than one year. the Directors consider that the carrying amount of trade and other
receivables is approximately equal to their fair value due to their short-term nature.
Financial liabilities at amortised cost
trade and other payables
Borrowings from related parties
27 September
2020
£ 000
29 September
2019
£ 000
31,486
12,402
43,888
20,324
21,082
41,406
Valuation methods and assumptions
the Directors consider that the carrying amount of trade and other payables is approximately equal to their fair value due to their
short-term nature. the fair value of financial liabilities is estimated by discounting the remaining contractual maturities at the current
market interest rate that is available for similar financial liabilities.
Fair value hierarchy
the tables above detail the company’s assets and liabilities disclosed at fair value. using a three-level hierarchy, based on the lowest
level of input that is significant to the entire fair value measurement, all assets and liabilities shown above are considered to be level 3:
‘unobservable inputs for the asset or liability’. there were no transfers between levels during the financial period.
Financial risk management and impairment of financial assets
the Group’s activities expose it to a variety of financial instrument risks. the risk management policies employed by the Group to manage
these risks are discussed below. the primary objectives of the financial instrument risk management function are to establish risk limits,
and then ensure that exposure to risks stay within these limits.
Capital risk management
the company’s objectives when managing capital is to safeguard its ability to continue as a going concern, so that it can provide returns
for shareholders and benefits for other stakeholders and to maintain an optimum capital structure to reduce the cost of capital.
59FINANCIAL STATEMENTS VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 NOTES TO THE FINANCIAL STATEMENTS
FoR tHE 52 WEEKS EnDED 27 SEptEMBER 2020
continuED
26 FINANCIAL INSTRUMENTS continuED
Capital risk management continued
capital is regarded as total equity, as recognised in the statement of financial position, plus net debt. net debt is calculated as total
borrowings less cash and cash equivalents.
in order to maintain or adjust the capital structure, the company may adjust the amount of dividends paid to shareholders, return capital
to shareholders, issue new shares or sell assets to reduce debt.
the company is subject to certain financing arrangements covenants and meeting these is given priority in all capital risk management
decisions. there have been no events of default on the financing arrangements during the financial period.
Credit risk management
the Group’s credit risk is attributable to trade and other receivables and cash with the carrying amount best representing the
maximum exposure to credit risk. the Group places its cash with banks with high-quality credit standings. trade and other receivables
relate to day-to-day activities which are entered into with creditworthy counterparties.
Market risk management
the Group’s activities expose it to economic factors; the Directors closely monitor market conditions and consider any impact on the
Group’s existing strategy.
Interest rate risk management
the Group is exposed to interest rate risk as the Group’s borrowings have an interest rate of 3.75% above LiBoR.
Liquidity risk management
Liquidity risk arises from the Group’s management of working capital and the finance charges and principal repayments on its debt
instruments. it is the risk that the Group will encounter difficulty in meeting its financial obligations as they fall due.
Management review cash flow forecasts on a regular basis to determine whether the Group has sufficient cash reserves to meet future
working capital requirements and to take advantage of business opportunities.
Remaining contractual maturities
the following tables detail the company’s remaining contractual maturities for its financial instrument liabilities. the tables have been
drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the financial liabilities are
required to be paid. the tables include both interest and principal cash flows disclosed as remaining contractual maturities and therefore
these totals may differ from their carrying amount in the statement of financial position.
2019
Non-derivatives
Non-interest-bearing
trade payables
other payables
Interest-bearing
Borrowings
Lease liability
Weighted
average
interest rate
%
1 year or less
£ 000
Between
1 and 2
years
£ 000
Between
2 and 5
years
£ 000
over 5 years
£ 000
Remaining
contractual
maturities
£ 000
–
–
1,783
3,470
1,783
3,470
3.75%/6%
+ LiBoR
4.5%
21,082
21,082
1,885
7,139
1,676
1,676
4,590
12,093
20,244
25,672
12,093
46,579
60FINANCIAL STATEMENTS VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 2020
Non-derivatives
Non-interest-bearing
trade payables
other payables
Borrowings – DDB
Interest-bearing
Borrowings – loan
Weighted
average
interest rate
%
1 year or less
£ 000
Between
1 and 2
years
£ 000
Between
2 and 5
years
£ 000
Over 5 years
£ 000
Remaining
contractual
maturities
£ 000
–
–
–
2,621
4,999
2,438
3.75%
+ LIBOR
9,515
1,038
2,621
4,999
11,953
1,038
Lease liability
4.5%
2,526
2,666
12,584
13,219
8,015
8,015
19,487
19,487
32,694
53,305
the cash flows in the maturity analysis above are not expected to occur significantly earlier than contractually disclosed above.
27 SHARE-BASED PAYMENTS
as at 27 September 2020, the Group and company maintained one share-based payment scheme for employee remuneration, the
Joint Share ownership plan (‘JSop’), which will be equity settled. the grants under the JSop were made on 18 September 2020.
in accordance with iFRS 2 “Share-based payment”, the value of the awards is measured at fair value at the date of the grant. the fair value
is expensed on a straight-line basis over the vesting period, based on management’s estimate of the number of shares that will eventually
vest. no charge has been recognised in profit and loss by the Group in the period ended 27 September 2020 as the proximity of the
grant date to the balance sheet date results in a charge that is not material.
the JSop is part of the remuneration package of the Group’s senior management. participants in this scheme have to be employed until
the end of the agreed vesting period. upon vesting, the holder is entitled to purchase ordinary shares at the market price determined at
grant date.
outstanding at 29 September 2019
Granted
Outstanding at 27 September 2020
Exercisable at 27 September 2020
JSop
number of
shares
Exercise price
per share (£)
–
5,809,523
5,809,523
–
–
0.73
0.73
–
61FINANCIAL STATEMENTS VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 NOTES TO THE FINANCIAL STATEMENTS
FoR tHE 52 WEEKS EnDED 27 SEptEMBER 2020
continuED
27 SHARE-BASED PAYMENTS continuED
the fair values of options granted were determined using a Black-Scholes model. the following principal assumptions were used in the
valuation:
Grant date
Vesting period ends
Share price at date of grant
Volatility
option life
Dividend yield
Risk-free investment rate
Fair value per option at grant date
Exercise price at date of grant
Exercisable from / to
Remaining contractual life
JSop
18 September 2020
31 august 2022
£0.73
66.98%
1.95 years
0.00%
(0.13)%
£0.26
£0.73
31 august 2022 / 31 august 2030
1.92 years
the historical volatility has been calculated based on the share returns of four comparators for a period preceding the valuation date
equal to the expected term of the options, i.e. a period of 1.95 years. the total estimated fair value of the options granted on 18 September
2020 to be recognised as an expense over the vesting period is £1,531,000.
28 RELATED PARTY TRANSACTIONS
transactions with related parties include management charges for services provided by osmond capital Limited, which has common
shareholders with controlling influence with the company, of £390,000 (2019: £236,000). in addition, HEM osmond is the principal
lender of the £10,000,000 borrowings (2019: £21,082,000 via Xercise2 Limited) and a shareholder with controlling influence of Xercise2
Ltd which is a significant shareholder of the company.
the capital restructure that took place in September 2020 (see note 24) involved the exchange of debt held by equity shareholders of
the Group (in the form of a loan facility and a deep discounted bond instrument) for newly issued ordinary share capital in the company.
as at 27 September 2020, there was £397,000 of accrued cash interest payable on borrowings from related parties, of which £341,000
was due to Xercise2 Ltd (2019: £365,000 total, £345,000 due to Xercise2 Ltd).
Remuneration of key management personnel
the remuneration of the Directors of the company and its subsidiaries and other key management, who are the key management
personnel of the Group, is set out below in aggregate for each of the categories specified in iaS 24 “Related party Disclosures”.
Salaries, employment taxes and other short-term employee benefits
post-employment benefits
52 weeks
ended
27 September
2020
£ 000
52 weeks
ended
29 September
2019
£ 000
600
12
612
537
16
553
62FINANCIAL STATEMENTS VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 Trading transactions
During the period, the company entered into the following trading transactions with related parties:
the Great House at Sonning Limited
Rare Bird Hotels Limited
Mudlark Hotels Limited
the following amounts were outstanding at the statement of financial position date:
Mudlark Hotels Limited
Purchase of
goods /
services
£ 000
Sale of
goods /
services
£ 000
364
491
–
855
351
281
29
661
Amounts
owed to
related
parties
£ 000
amounts
owed by
related
parties
£ 000
2
38
the Great House at Sonning Limited, Rare Bird Hotels Limited, and Mudlark Hotels Limited are related parties of the company because
they have common shareholders with controlling influence in the company. the trade and certain assets of the Great House at
Sonning Limited and Rare Bird Hotels Limited were acquired by newly incorporated operating companies in august 2020, Rare Bird
Hotels at Sonning Limited and Rare Bird Hotels at Streatley Limited respectively. the entire issued share capital of these companies was
subsequently acquired by the company in September 2020 (see note 6).
Sales and purchases of goods and services between the related parties were made at market prices discounted to reflect the
relationships between the parties.
the amounts outstanding are unsecured and will be settled in cash. no guarantees have been given or received. no provisions have been
made for doubtful debts in respect of the amounts owed by related parties.
29 CONTROLLING PARTY
the ultimate controlling party of the company is HEM osmond.
30 POST-BALANCE SHEET EVENTS
Coppa Club Cobham
in December 2020, the Group was able to open its newest site at cobham. Both sales and future bookings were exceptional, far above
the business case despite the restrictions in place under the tier system at the time of opening.
Coronavirus
the coronavirus (covid-19) outbreak continued to hamper the trade of the Group post year end as a result of the tier system introduced
that was swiftly followed by a second national month-long lockdown enforced in november 2020. after returning to trade in December
2020, all sites across the estate were forced to close under the tier system by christmas and, as at the date of the financial statements
being approved, have not yet been able to reopen due to a third national lockdown that started in early January 2021.
Insurance claim
post the reporting date, the Group received an interim payment from its insurer of £2,500,000 with regards to its covid-19-related
business interruption claim. the claim is still being finalised with the final quantum not yet known as at the date of signing. in
accordance with iaS 37 provisions, contingent Liabilities and contingent assets, no amount has been recognised as at 27 September
2020.
VEL Property Holdings Limited funding
Within current liabilities at the year end, there was a deep discounted bond instrument with a nominal value of £2,438,000 and a final
redemption date of 14 January 2021. in January 2021, this was replaced by a new deep discounted bond instrument with a nominal value
of £2,584,000 and a final redemption date of 14 January 2022.
63FINANCIAL STATEMENTS VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 NOTES TO THE FINANCIAL STATEMENTS
FoR tHE 52 WEEKS EnDED 27 SEptEMBER 2020
continuED
31 CONTINGENT LIABILITIES
Authorised Guarantee Agreements
there are nine (2019: nine) previously operated sites that have been disposed of via assignment of lease and include authorised
Guarantee agreements (‘aGas’) as part of the assignment arrangement. there is a risk that the sites would be returned if the assigned
leaseholders were to default on their contractual obligations with their respective landlords, the risk of which has been heightened as a
result of the coronavirus (covid-19) outbreak. the total annual rental cost for these sites is £733,000, of which £461,000 has been
provided for (see note 23).
CJRS claim
the Group recognised claims of £2.8m under the cJRS schemes during the period in order to support the business through the
pandemic. Given multiple changes to the rules governing the schemes, as well as the degree of complexity in the various rules, the
Group is undertaking a review of past claims to confirm their validity. the Directors are of the opinion that claims made to date are valid
and materially correct and so do not consider the likelihood of material outflow as a result of this review to be probable. accordingly, the
Directors cannot reliably estimate what the amount of any outflow might be.
64FINANCIAL STATEMENTS VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 ADVISORS
NOMINATED ADVISER AND BROKER
WH ireland Limited
24 Martin Lane
London
Ec4R 0DR
INDEPENDENT AUDITORS
RSM uK audit LLp
25 Farringdon Street
London
Ec4a 4aB
REPORTING ACCOUNTANTS
RSM corporate Finance LLp
25 Farringdon Street
London
Ec4a 4aB
SOLICITORS TO THE COMPANY
irwin Mitchell LLp
40 Holborn Viaduct
London
Ec1n 2pZ
PUBLIC RELATIONS
alma pR
71-73 carter Lane
London
Ec4V 5EQ
FINANCIAL STATEMENTS VARIOUS EATERIES PLCANNUAL REPORT & ACCOUNTS 2020 V
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2
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REGISTERED OFFICE:
20 St. Thomas Street
Runway East
London
SE1 9RS
www.variouseateries.co.uk