TIDM85QW
RNS Number : 2744T
Broadgate Financing PLC
13 November 2023
Broadgate Financing PLC
Interim Report and Financial Statements for the period ended 30
September 2023
The Interim Report and Financial Statements for the six months
ended 30 September 2023, attached below in accordance with DTR
6.3.5, have been submitted to the Financial Conduct Authority
through the National Storage Mechanism and will shortly be
available for inspection at
https://www.fca.org.uk/markets/primary-markets/regulatory-disclosures/national-storage-mechanism
The Annual Report and Financial Statements are also available at
https://www.britishland.com/investors/debt/strategic-partnerships/broadgate-financing-plc
Directors' Report
for the six months ended 30 September 2023
The Directors present their report and unaudited interim
financial statements for the six months ended 30 September
2023.
Directors of the Company
The Directors, who held office during the period, and up to the
date of signing the interim financial statements, were as
follows:
D Lockyer
H Shah
D Richards
Principal activity
The Company's principal activity is to provide funding to fellow
subsidiaries of Broadgate Property Holdings Limited in the United
Kingdom (UK).
Results for the six months
As shown in the Company's Profit and Loss Account on page 5, the
Company's profit before taxation has remained stable compared with
the prior period. Consistent with the prior period, the Company has
continued to amortise bonds as well as incur interest on those
bonds outstanding, and charge these costs to fellow
subsidiaries.
At 30 September 2023, interest payable on external bonds remains
100% fixed.
The Balance Sheet on page 7 shows the Company has net assets of
GBP443,994 at 30 September 2023. Net assets have stayed consistent
during the period.
Principal risks and uncertainties
This Company is part of a large property investment group,
headed by Broadgate REIT Limited (the "Group"). As such, the
fundamental underlying risks for this Company are those of the
property Group. The key risks of this Group are the performance of
the properties and tenant default and credit risk of counterparties
for holding cash deposits. These risks are mitigated by preference
for tenants with strong covenants on long leases and by using
highly rated Financial Institutions for placing cash deposits.
These risks have high visibility to senior executives and are
considered and managed on a continuous basis. Executives use their
knowledge and experience to knowingly accept a measured degree of
market risk.
The Group's preference for prime assets and their secure long
term contracted rental income, primarily with upward only rent
review clauses, presents lower risks than many other property
portfolios.
Credit risk is the risk that one party to a financial instrument
will fail to discharge an obligation and cause the other party to
incur a financial loss. In order to manage this risk, management
regularly monitors the credit rating of credit counterparties and
monitors all amounts that are owed to the Company.
Liquidity risk is the risk that the entity will encounter
difficulty in raising funds to meet commitments associated with
financial liabilities. This risk is managed through day to day
monitoring of future cash flow requirements to ensure that the
Company has enough resources to repay all future liabilities as
they fall due.
The general risk environment in which the Company operates has
been volatile in terms of the economic and political landscape,
with future sentiment remaining fragile.
Going Concern
The Directors have reviewed the Company's forecast working
capital and cash flow requirements in addition to making enquiries
and examining areas which could give risk to financial exposure.
The Directors have an expectation that the forecast cash flows on
the secured properties will be sufficient to cover debt service on
the bonds. The Company has access to the drawn down term loan of
GBP52,080,000 (2022: GBP52,080,000) to meet certain shortfalls on
bond service, if there was a shortfall from the rent received.
Therefore, the Directors have a reasonable expectation that the
Company has adequate resources to continue its operations for at
least twelve months after the signing of the these financial
statements and as a result they continue to adopt the going concern
basis in preparing the accounts.
Responsibility Statement of the Directors in respect of the
Interim Financial Statements
Each of the Directors confirms that to the best of their
knowledge:
The condensed set of interim financial statements has been
prepared in accordance with Financial Reporting Standard 104:
Interim Financial Reporting issued by the Financial Reporting
Council.
The Directors' Report above includes a fair review of the
information required by DTR 4.2.7R of the Disclosure and
Transparency Rules (DTR), being an indication of important events
that have occurred during the first six months of the financial
year and their impact on the condensed set of interim financial
statements; and a description of the principal risks and
uncertainties for the remaining six months of the year.
Approved by the Board on 10 November 2023 and signed on its
behalf by:
Hursh Shah
Director
Independent review report to Broadgate Financing PLC
Report on the condensed interim financial statements
Our conclusion
We have reviewed Broadgate Financing PLC's condensed interim
financial statements (the "interim financial statements") in the
Interim Report and Financial Statements of Broadgate Financing PLC
for the 6 month period ended 30 September 2023 (the "period").
Based on our review, nothing has come to our attention that
causes us to believe that the interim financial statements are not
prepared, in all material respects, in accordance with FRS 104
"Interim Financial Reporting" issued by the Financial Reporting
Council and the Disclosure Guidance and Transparency Rules
sourcebook of the United Kingdom's Financial Conduct Authority.
The interim financial statements comprise:
-- the Balance Sheet as at 30 September 2023;
-- the Profit and Loss Account and Statement of Comprehensive
Income for the period then ended;
-- the Statement of Changes in Equity for the period then ended;
and
-- the explanatory notes to the interim financial statements.
The interim financial statements included in the Interim Report
and Financial Statements of Broadgate Financing PLC have been
prepared in accordance with FRS 104 "Interim Financial Reporting"
issued by the Financial Reporting Council and the Disclosure
Guidance and Transparency Rules sourcebook of the United Kingdom's
Financial Conduct Authority.
Basis for conclusion
We conducted our review in accordance with International
Standard on Review Engagements (UK) 2410, 'Review of Interim
Financial Information Performed by the Independent Auditor of the
Entity' issued by the Financial Reporting Council for use in the
United Kingdom ("ISRE (UK) 2410"). A review of interim financial
information consists of making enquiries, primarily of persons
responsible for financial and accounting matters, and applying
analytical and other review procedures.
A review is substantially less in scope than an audit conducted
in accordance with International Standards on Auditing (UK) and,
consequently, does not enable us to obtain assurance that we would
become aware of all significant matters that might be identified in
an audit. Accordingly, we do not express an audit opinion.
We have read the other information contained in the Interim
Report and Financial Statements and considered whether it contains
any apparent misstatements or material inconsistencies with the
information in the interim financial statements.
Responsibilities for the interim financial statements and the
review
Our responsibilities and those of the directors
The Interim Report and Financial Statements, including the
interim financial statements, is the responsibility of, and has
been approved by the directors. The directors are responsible for
preparing the Interim Report and Financial Statements in accordance
with the Disclosure Guidance and Transparency Rules sourcebook of
the United Kingdom's Financial Conduct Authority. In preparing the
Interim Report and Financial Statements, including the interim
financial statements, the directors are responsible for assessing
the 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 company or to cease operations, or have no realistic
alternative but to do so.
Our responsibility is to express a conclusion on the interim
financial statements in the Interim Report and Financial Statements
based on our review. Our conclusion, including our Conclusions
relating to going concern, is based on procedures that are less
extensive than audit procedures, as described in the Basis for
conclusion paragraph of this report. This report, including the
conclusion, has been prepared for and only for the company for the
purpose of complying with the Disclosure Guidance and Transparency
Rules sourcebook of the United Kingdom's Financial Conduct
Authority and for no other purpose. We do not, in giving this
conclusion, accept or assume responsibility for any other purpose
or to any other person to whom this report is shown or into whose
hands it may come save where expressly agreed by our prior consent
in writing.
PricewaterhouseCoopers LLP
Chartered Accountants
London
10 November 2023
Profit and Loss Account
for the six months ended 30 September 2023
Six months Six months
ended ended
30 September 30 September
2023 2022
Unaudited Unaudited
Note GBP GBP
Turnover - -
Administrative expenses (500) (501)
------------- -------------
Loss before interest and taxation (500) (501)
Interest receivable and similar income 3 28,745,033 27,501,498
Interest payable and similar expenses 4 (28,743,319) (27,499,835)
------------- -------------
Profit before tax 1,214 1,162
Tax on profit (304) (221)
------------- -------------
Profit for the period 910 941
============= =============
Turnover and results were derived from continuing operations
within the United Kingdom. The Company has only one significant
class of business: to provide funding to fellow subsidiaries of
Broadgate Property Holdings Limited in the United Kingdom (UK).
Statement of Comprehensive Income
for the Period from 1 April 2023 to 30 September 2023
Six months Six months
ended 30 September ended 30 September
2023 2022
Unaudited Unaudited
GBP GBP
Profit for the period 910 941
------------------- -------------------
Total comprehensive income for the period 910 941
=================== ===================
(Registration number: 05316365)
Balance Sheet
as at 30 September 2023
30 September 31 March
2023 2023
Unaudited Audited
Note GBP GBP
Current assets
Debtors due within one year 5 171,757,163 160,311,809
Cash at bank and in hand 6 56,037,889 56,037,436
Intercompany non-current debtors 5 1,083,526,752 1,095,810,106
--------------- ---------------
1,311,321,804 1,312,159,351
--------------- ---------------
Current liabilities
Creditors due within one year 7 (175,271,008) (163,826,111)
=============== ===============
Net current assets 1,136,050,796 1,148,333,240
Non-current liabilities
Loans and borrowings 8 (1,135,606,802) (1,147,890,156)
--------------- ---------------
Net assets 443,994 443,084
=============== ===============
Capital and reserves
Share capital 9 12,500 12,500
Profit and loss account 431,494 430,584
--------------- ---------------
Total shareholders' funds 443,994 443,084
=============== ===============
Approved by the Board on 10 November 2023 and signed on its
behalf by:
Hursh Shah
Director
Statement of Changes in Equity
for the six months ended 30 September 2023
Profit and
Share capital loss account Total
GBP GBP GBP
Balance at 1 April 2022 (audited) 12,500 426,123 438,623
Profit for the period (unaudited) - 941 941
------------- ------------- -------
Total comprehensive income
for the period (unaudited) - 941 941
------------- ------------- -------
Balance at 30 September 2022
(unaudited) 12,500 427,064 439,564
============= ============= =======
Balance at 1 April 2023 (audited) 12,500 430,584 443,084
Profit for the period (unaudited) - 910 910
------ ------- -------
Total comprehensive income
for the period (unaudited) - 910 910
------ ------- -------
Balance at 30 September 2023
(unaudited) 12,500 431,494 443,994
====== ======= =======
Notes to the Interim Financial Statements
for the six months ended 30 September 2023
1 General information
The Company is a public company limited by share capital,
incorporated and domiciled in England, United Kingdom.
The address of its registered office is:
York House
45 Seymour Street
London
W1H 7LX
2 Accounting policies
Summary of significant accounting policies and key accounting
estimates
The principal accounting policies applied in the preparation of
these interim financial statements are set out below. These
policies have been consistently applied to all the periods
presented, unless otherwise stated.
The directors do not consider there to be any significant
accounting judgements or key sources of estimation uncertainty in
the preparation of these financial statements.
Accounting basis
The information for the period ended 30 September 2023 does not
constitute statutory financial statements as defined in section 434
of the Companies Act 2006.
A copy of the statutory financial statements for the year ended
31 March 2023 has been delivered to the Registrar of companies. The
auditors reported on those financial statements: their report was
unqualified, did not draw attention to any matters by way of
emphasis and did not contain a statement under section 498 (2) or
(3) of the Companies Act 2006. The current period financial
information presented in this document has been reviewed, not
audited.
Adoption status of new financial reporting standards and
interpretations
A number of new standards and amendments to standards and
interpretations have been issued for the current accounting period.
The IASB issued narrow-scope amendments to IAS 12 that are yet to
be adopted by the UK endorsement board, as part of the Pillar Two
model implementation. The Company is currently assessing the impact
of Pillar Two and the associated IAS 12 amendments. The following
standards and interpretations which have been issued but are not
yet effective include IAS 1 'Presentation of Financial Statements'
on the classification of liabilities and non-current liabilities
with covenants, IFRS 16 'Leases' on sale and leaseback
arrangements, and limited scope amendments to both IFRS 10
'Consolidated Financial Statements' and IAS 28 'Investments in
Associates and Joint Ventures' in respect of sale or contribution
of assets between an investor and its associates or joint ventures.
These amendments to standards that are not yet effective are not
expected to have a material impact on the Company's results.
Basis of preparation
These interim financial statements were prepared in accordance
with Financial Reporting Standard 104 Interim Financial Reporting
("FRS 104") and the Disclosure Guidance and Transparency Rules
sourcebook of the United Kingdom's Financial Conduct Authority.
The interim financial statements does not include all of the
notes of the type normally included in an annual report and
accounts. Accordingly, this report is to be read in conjunction
with the annual report and accounts for the year ended 31 March
2023, which has been prepared in accordance with the Financial
Reporting Standard 101 Reduced Disclosure Framework ("FRS
101").
The same accounting policies, estimates, presentation and
methods of computation are followed in the interim financial
statements as applied in the latest annual audited financial
statements.
Instances in which the advantage of the FRS 101 disclosure
exemptions have been taken are set out below.
Summary of disclosure exemptions
The Company has taken advantage of the following disclosure
exemptions under FRS 101:
(a) The requirements of IAS 1 to provide a Statement of Cash
flows for the period;
(b) The requirements of IAS 1 to provide a statement of
compliance with IFRS;
(c) The requirements of paragraphs 30 and 31 of IAS 8 Accounting
Policies, Changes in Accounting Estimates and Errors to disclose
new IFRS's that have been issued but are not yet effective;
(d) The requirements in IAS 24 Related Party Disclosures to
disclose related party transactions entered into between two or
more members of a group, provided that any subsidiary which is a
party to the transaction is wholly owned by such a member;
(e) The requirements of IFRS 7 to disclose financial
instruments; and
(f) The requirements of paragraphs 91-99 of IFRS 13 Fair Value
Measurement to disclose information of fair value valuation
techniques and inputs.
Disclosure exemptions for subsidiaries are permitted where the
relevant disclosure requirements are met in the consolidated
financial statements. Where required, equivalent disclosures are
given in the Group financial statements of Broadgate REIT Limited.
The Group financial statements of Broadgate REIT Limited are
available to the public and can be obtained as set out in note
12.
Going Concern
The Directors have reviewed the Company's forecast working
capital and cash flow requirements and in addition to making
enquiries and examining areas which could give risk to financial
exposure. The Directors have an expectation that the forecast cash
flows on the secured properties will be sufficient to cover debt
service on the bonds. The Company has access to the drawn down term
loan of GBP52,080,000 (2022: GBP52,080,000) to meet certain
shortfalls on bond service, if there was a shortfall from the rent
received. Therefore, the Directors have a reasonable expectation
that the Company has adequate resources to continue its operations
for at least twelve months after the signing of the these financial
statements and as a result they continue to adopt the going concern
basis in preparing the accounts.
3 Interest receivable and similar income
Six months Six months
ended 30 September ended 30 September
2023 2022
Unaudited Unaudited
GBP GBP
Interest income on bank deposits 1,304,548 352,327
Interest receivable on amounts owed by
related parties 27,440,485 27,149,171
------------------- -------------------
28,745,033 27,501,498
=================== ===================
4 Interest payable and similar expenses
Six months Six months
ended ended
30 September 30 September
2023 2022
Unaudited Unaudited
GBP GBP
Interest payable on bonds and borrowings 28,743,319 27,499,835
------------------- -------------------
28,743,319 27,499,835
=================== ===================
5 Debtors
30 September 31 March
2023 2023
Unaudited Audited
GBP GBP
Debtors due within one year
Amounts due from related parties 158,388,267 147,360,815
Accrued income 13,355,709 12,937,806
Other debtors 11,339 11,340
Corporation tax asset 1,848 1,848
------------------- -------------------
171,757,163 160,311,809
=================== ===================
30 September 31 March
2023 2023
Unaudited Audited
GBP GBP
Debtors due after more than one year
Amounts due from related parties - Long
term loans 1,083,526,752 1,095,810,106
------------- -------------
1,083,526,752 1,095,810,106
============= =============
The intercompany loans to Broadgate (Funding) 2005 Ltd are being
repaid from April 2005 to July 2033, with the average interest rate
of these intercompany loans being 4.93% per annum (31 March 2023:
4.93%). There is no interest charged on the remainder of amounts
owed by related parties and are repayable on demand. Amounts due
from related parties relate to amounts owed from group companies
and are repayable on demand, hence are included in current
assets.
6 Cash and cash equivalents
30 September 31 March
2023 2023
GBP GBP
Cash at bank 131,889 131,436
Short-term deposits 55,906,000 55,906,000
------------ ----------
56,037,889 56,037,436
============ ==========
Short term deposits mature within 3 months and therefore meet
the definition of cash and cash equivalents.
7 Creditors due within one year
30 September 31 March
2023 2023
Unaudited Audited
GBP GBP
Accrued interest 13,578,855 13,083,832
Amounts due to related parties 147,857,422 147,857,118
Secured bonds 13,816,380 2,866,810
Other creditors 18,351 18,351
------------ -----------
175,271,008 163,826,111
============ ===========
Amounts due to related parties relate to amounts owed to group
companies and are repayable on demand. There is no interest charged
on these balances.
8 Loans and borrowings
30 September 31 March
2023 2023
Unaudited Audited
GBP GBP
Borrowings
Borrowings due 1 to 2 years 46,666,810 35,716,810
Borrowings due 2 to 5 years 140,000,000 140,000,000
Borrowings due after 5 years 948,939,992 972,173,346
------------- -------------
1,135,606,802 1,147,890,156
============= =============
Amounts due after five years include the term loan of
GBP52,080,000 (31 March 2023: GBP52,080,000) which represents a
liquidity facility with NatWest Markets PLC. The cash received is
held on deposit.
30 September 31 March
2023 2023
Unaudited Audited
GBP GBP
Borrowings repayment analysis
Borrowings due within one year 13,816,380 2,866,810
Borrowings due between one to two years 46,666,810 35,716,810
Borrowings due between two to five years 140,000,000 140,000,000
------------- -------------
200,483,190 178,583,620
Borrowings due after five years 948,939,992 972,173,346
------------- -------------
Total borrowings 1,149,423,182 1,150,756,966
------------- -------------
Gross debt 1,149,423,182 1,150,756,966
============= =============
Secured bonds on the assets of the Broadgate Property Holdings
Limited Group
30 September 31 March
2023 2023
Unaudited Audited
GBP GBP
Class A3 4.851% Bonds 2033 143,900,050 143,900,050
Class A4 4.821% Bonds 2036 400,000,000 400,000,000
Class B 4.999% Bonds 2033 365,000,000 365,000,000
Class C2 5.098% Bonds 2035 188,483,190 189,916,810
------------- -------------
Total secured bond borrowings 1,097,383,240 1,098,816,860
Term Loan 52,080,000 52,080,000
------------- -------------
Total secured borrowings 1,149,463,240 1,150,896,860
============= =============
At 30 September 2023, 100% (31 March 2023: 100%) of the bonds
were fixed. The bonds amortise from 2005 and are expected to be
repaid by 2033. Legal repayment is required by 2036. The term loan
matures on the date when all the bonds have been redeemed in full.
The bonds are secured on properties of the Group valued at
GBP2,740m (31 March 2023: GBP2,916m). The weighted average interest
rate of the bonds is 4.93% (31 March 2023: 4.93%). The weighted
average maturity of the bonds is 7.4 years (31 March 2023: 7.9
years).
Fair value of bonds
The fair values of the bonds have been established by obtaining
quoted market prices from brokers.
30 September 31 March
2023 2023
Unaudited Audited
GBP GBP
Secured bonds at fair value 1,018,927,303 1,067,805,334
============= =============
9 Share capital
Allotted, called up and fully paid shares
30 September 31 March
2023 2023
Unaudited Audited
No. GBP No. GBP
Ordinary shares of GBP0.25
each 50,000 12,500 50,000 12,500
10 Capital commitments
The Company had capital commitments contracted as at 30
September 2023 of GBPnil (31 March 2023: GBPnil).
11 Related party transactions
The Company has taken advantage of the exemption granted to
wholly owned subsidiaries not to disclose transactions with group
companies under the provisions of FRS 101.
Subsequent events
12
There have been no subsequent events since 30 September
2023.
13 Parent and ultimate parent undertaking
The immediate parent company is Broadgate Property Holdings
Limited.
The ultimate parent company is Broadgate REIT Limited. Broadgate
REIT Limited operates as a joint venture between Euro Bluebell LLP,
an affiliate of GIC, Singapore's sovereign wealth fund, and BL
Bluebutton 2014 Limited, a wholly owned subsidiary of The British
Land Company PLC.
Broadgate REIT Limited is the largest group, and Bluebutton
Properties UK Limited is the smallest group, for which group
accounts are available and which include the Company. The ultimate
holding company and controlling party is Broadgate REIT Limited.
Group accounts for this company are available on request from
British Land, York House, 45 Seymour Street, London, W1H 7LX.
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END
IR XXLFFXFLEFBD
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November 13, 2023 09:01 ET (14:01 GMT)
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