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0
ONE HERITAGE GROUP PLC
Annual report for
the year ended
30 June 2023
31 OCTOBER 2023
1
Who We Are
One Heritage Group PLC is a property development and management company. We focus on the residential
sector primarily in the North of England, seeking out value and maximising opportunities for our investors.
We are a team of dedicated and experienced professionals with a proven track record in property
development and investment. In December 2020, One Heritage Group PLC became one of the first publicly
listed residential developers with a focus on Co-living.
Our Mission
To develop high-quality residential properties and Co-living housing in urban communities in the UK with
high demand from professional tenants and to provide a first class letting and management service to
create a socially sustainable living environment.
Our Vision
To become an acknowledged market leader in the provision and management of high-quality residential
properties in our chosen geographies.
Our Values
We follow best practice, so that our developments provide a safe and environmentally friendly living
experience. We treat all stakeholders with respect, and we ensure that our leadership and governance are
effective and transparent and adhere to the highest standards of ethical practice.
ONE HERITAGE GROUP PLC
2
CONTENTS
Strategic report
3 Chairman’s statement
4 Chief Executive’s statement
14 Group financial review
Directors’ report
19 Board of Directors
21 QCA Corporate Governance Code
26 Board Leadership and Company Purpose
31 Nomination committee report
32 Audit and Risk committee report
34 Remuneration committee report
39 Statement of Directors’ Responsibilities
Financial statements
41 Independent Auditor’s report to the Members of One Heritage Group plc
51 Consolidated statement of comprehensive income
52 Consolidated statement of financial position
53 Consolidated statement of cash flows
54 Consolidated statement of changes in equity
55 Notes to the consolidated financial statements
83 Company balance sheet
84 Company statement of changes in equity
85 Notes to the Company financial statements
Shareholder information
91 Notice of Annual General Meeting
93 Notes to the Notice of the Annual General Meeting
ONE HERITAGE GROUP PLC
3
STRATEGIC REPORT
Chairman’s statement
An inflationary environment and supply chain difficulties, caused by number of macro-economic and
geopolitical factors, have had a significant and adverse bearing on the property development industry
and we have not proved immune to this. Equally, however, as became evident as time passed,
our acquisition and delivery strategies, with notable exceptions, have not served us well, in mitigating the
inherent risks associated with property development. And so, while the Board was pleased to see the
completion during the year of three direct development projects at Lincoln House, Bolton, Bank Street,
Sheffield and Oscar House, Manchester and one development management project at Oldham, it is
clearly disappointing to all concerned that two of the development projects (Bank Street and Oscar
House) have been further impaired, as has St Petersgate, Stockport which awaits completion this quarter.
Having said this, I am pleased to see the energy and clarity of purpose with which the Executive Team has
responded to the challenges we faced. New senior appointments both on the acquisition and delivery
sides of the business are very welcome and significant initiatives have been introduced to good effect
- namely a widening of our net in terms of target acquisitions to include housing as well as apartments
and local authority and social housing partnering; and, in terms of delivery, third party outsourcing on
fixed priced construction contracts in lieu of an in-house model.
The sales side of the development process has gone well and is testament to the quality of our product,
its desirability to the rental market and the exceptional sales network that our parent company has built
up in Asia. There remains strong appetite from the overseas investor for the right product, accompanied
by good professional management services, particularly in our chosen geographies.
It’s important to note that of the original batch of properties purchased pre-January 2022, only St
Petersgate, Stockport awaits completion and that Churchgate, Leicester and Seaton House, Stockport,
both consented sites, are to be sold and not developed out by the Group following a reassessment of
profitability. Construction is going well at the most recent purchase i.e. the site for housing at Victoria
Road, Eccleshill and there are a number of encouraging discussions ongoing on other potential projects.
Our other principal source of revenue comes from our development management activities and I
am pleased with the way that One Victoria, Manchester is shaping up and we are putting every effort in to
are making sure that this business line grows in significance going forward.
Despite setbacks, I am confident that our revised strategies are fit for purpose, that we have the
leadership and technical expertise to deliver them and that with the continued support of our
major shareholder, our bottom line performance will greatly improve.
David Izett
Chairman
31 October 2023
David Izett (Oct 31, 2023 13:23 GMT)
ONE HERITAGE GROUP PLC
4
STRATEGIC REPORT
Chief Executive’s statement
Reflecting on the past financial year, I wish to acknowledge the hard work and commitment of our team
particularly in respect of the four development projects – three direct developments and one development
management project - completed during the period. Overall, after adapting our strategies in response to
market conditions, strengthening our team, and refining our internal processes and delivery, I believe that
we are in a much stronger position to deliver value for our shareholders in the future.
In 2021, in difficult market conditions leading to a reduction in the number of appropriate 3
rd
party contractor
options and much higher pricing from those willing to quote, and following a contractor insolvency at Bank
Street Sheffield and North Church House, Sheffield, we took the decision, essentially out of necessity, to
take construction in house. We recognise that the performance of self-delivery projects has not gone to
plan as costs have continued to increase to our detriment. It is important to note that the outstanding
projects of North Church House, Sheffield and St Petersgate, Stockport where we are providing in house
construction are due to complete this quarter and our delivery strategy will be focused on obtaining a fixed
price contract for future projects.
While there is no doubt that external factors such as cost increases and delays have impacted us severely
across a number of our projects, we also recognised that changes were required to our acquisition and
delivery strategies to mitigate attendant risks to the development process leading to strong future
performance.
Our acquisitions strategy has become more cautious over the past year to avoid some of the particular
problems encountered on more challenging projects such as Bank Street and St Petersgate. A highly
experienced Investment Director was appointed earlier in the year to head the acquisition team in order to
build a more risk averse pipeline. Similarly, as mentioned above, our delivery strategy has evolved to an
outsourced model to mitigate the risk of unforeseen cost increases. To lead this team, we have hired a Head
of Projects to provide us with greater oversight and control of how projects are delivered. These two senior
appointments add to the Interim Development Director appointed earlier in the year and have enabled us
to create three specialist teams i.e., Acquisition, Technical and Delivery for future projects. We are delighted
to have recruited great people for these roles and to have restructured our development team during the
period, acknowledging where we went wrong and what we can do better.
Now that we have settled on a revised project delivery strategy, and we believe that the picture on costs is
clearer, we are focusing our efforts on finding and securing new opportunities for direct development. We
have also increased our efforts to source profitable deals as development manager or in Joint Ventures,
along with establishing what we hope will be long term partnerships with local authorities and registered
housing providers.
In order to measure our success as a business, in last year’s statement I highlighted four strategic objectives
for the Group to perform against:
1. Successfully delivering our existing development projects
As mentioned above, this year has been marked by four project completions – three direct developments
and one development management project.
The first completion in FY 2023 was our direct development of Lincoln House, Nelson Street, Bolton,
previously a part-built office building, which we repurposed for residential use to provide 88 apartments.
The gross floor area of the building is c., 60,500 square feet.
ONE HERITAGE GROUP PLC
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In March 2023, we completed our first development management project, a conversion of Oldham County
Court, New Radcliffe Street, Oldham, into 42 residential apartments comprising a gross floor area of c.,
33,400 square feet. This also marked the completion of the Group’s first partnership with a housing
association, and all 42 apartments were let at affordable rents, boosting the availability of affordable
housing in Oldham Town Centre.
In May 2023, we delivered our second direct development of 2023 calendar year at Liberty House, Bank
Street, Sheffield. This was the conversion of a former Grade II Listed office building into an apartment block
of 23 units, with a gross floor area of c., 21,000 square feet.
In quick succession to Liberty House, in June 2023, we announced the practical completion of our third
direct development at Oscar House, Chester Road, Manchester. This is a six-storey apartment block of c.,
19,700 square feet and comprises 27 units on a formerly unoccupied brownfield site.
Post-period end, we updated the market that the completion of 57 St Petersgate, Stockport, a conversion of
a former office building, comprising 18 apartments, 1 commercial unit and c., 12,000 square feet, was
delayed until later this calendar year, due to further challenges in respect of sub-contractor labour
shortages.
As mentioned above and as announced in our interim results, after careful internal evaluation, we took the
decision to cease providing in-house construction services to both our direct development and
development management projects in favour of the appointment of a fixed-price principal contractor. This
will take effect later this year, tying in with the completion of our direct development of 57 St Petersgate,
Stockport and our development management project at North Church House, Queen Street, Sheffield which
comprises 58 apartments in a former office building totalling c., 41,400 square feet.
As previously announced, principally as a result of an increase in costs due to rising material prices, sub-
contractor prices and cost of debt, the Group impaired the value of its developments at Bank Street, St
Petersgate, and Oscar House.
The Group has previously confirmed its decision to sell the consented development at Churchgate,
Leicester, following a viability review based around its design and costs and has accepted an offer that is
progressing through the due diligence and legal processes. We have also recently decided to sell the
consented project at Seaton House, Stockport following a viability review.
In April 2023, we were pleased to commence the construction, as developer, of 24 houses at Victoria Road,
Eccleshill, West Yorkshire, our first new build housing project. A principal contractor has been appointed
with a fixed price build contract and completion is expected in H2 2024.
Direct
Development
Projects
Residential
Units
Commercial
Units
Reservations
*
Exchanged
*
Completed
Sales *
Expected
Completion
Lincoln
House,
Bolton
88
0
£10.1m
2
0
76
Completed
Bank Street,
Sheffield
23
0
£3.9m
1
0
19
Completed
Oscar House,
Manchester
27
0
£6.8m
1
1
7
Completed
ONE HERITAGE GROUP PLC
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St
Petersgate,
Stockport
18
1
£2.9m
0
18
0
H2 2023
Victoria
Road,
Eccleshill
24
0
£6.5m
Not released
H2 2024
Seaton
House,
Stockport
35
0
£5.6m
Not released
To be sold
Churchgate,
Leicester
15
1
£3.1m
Not released
To be sold
230
2
4
19
102
*As at 23 October 2023
2. Secure sales for our properties under construction
We have continued to see strong demand for well-designed and well-located homes with 71 units (out of
125 available for sale) sold and legally completed during the period which increased to 102 at 23 October
2023.
Post period, the Group has exchanged contracts for the bulk sale of twenty apartments at Lincoln House,
Bolton. The sales were contracted to complete in August 2023, but following buyer delays, the remaining
units completed in October 2023. This, along with two further sales increases the number of completions
at Lincoln House to 76 out of 88. Bank Street reported two further sales completions post year end.
In June 2023, the Group announced that the buyer underwriting the purchase of 27 apartments at Oscar
House had failed to perform on 22 apartments. The Group has since remarketed the units and following a
revaluation, it is anticipated that the GDV will increase from £6.1m to £6.8m. Oscar House recorded its first
sale completions, seven in total, post year end.
The marketing of the 24 houses at Victoria Road, Eccleshill will commence in Q1 2024 when construction
has progressed further and we enter the final six months of the project.
3. Growing the pipeline of new development opportunities
We are investing considerable time and effort into seeking out new opportunities both for our direct
development business and for larger development partners for whom we undertake the development
management role. But we do so with caution. Since 2020 BCIS (Building Cost Information Service
Construction Data) cite a 24% increase in build costs with an 8.7% increase in 2022. Similarly, interest rates
have risen from 1% in May 2022 to 5.25% in August 2023. Markets and supply chains continue to recalibrate
post the pandemic and the disruptions caused by the ongoing war in Ukraine and the unfolding events in
Israel.
At the time of writing, we have several potential sites under review and have a number of encouraging
conversations underway with possible joint venture partners such as local authorities and housing
associations. We will be updating the market on this in due course.
ONE HERITAGE GROUP PLC
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4. Create diverse sources of revenue generated through the Group’s service provisions
Development management
The second of our two core business lines is development management and as mentioned above,
in March 2023 we completed our first such project, a conversion of Oldham County Court, New Radcliffe
Street, Oldham, into 42 residential apartments. We are also managing the development of North Church
House, Queen Street, Sheffield which comprises 58 apartments. More recently, we announced our
appointment as development manager to deliver One Victoria, Manchester. We have entered into a
construction agreement with Torsion Construction Limited, who will construct the new-build development
comprising c.,113,000 square feet across two buildings containing a total of 129 units and two ground-floor
commercial units. One Victoria is a significant regeneration project in Manchester City Centre, and we are
looking forward to managing its successful delivery.
Our other development management project of scale is One Heritage Tower which is still yet to commence
construction. The project has been significantly impacted by increased construction costs resulting in the
need for design changes to improve efficiency and reduce costs. Interest rate increases have also impacted
the cost of debt. Despite these viability challenges, progress is being made on a fixed price construction
contract, and options are being progressed which include both a sale of the project and a revised delivery
strategy with funding partners.
Property services
Our property services team has worked hard this year to establish the infrastructure needed to
accommodate the increase in properties under management. We have invested in a new Customer
Relationship Management (CRM) system and have gained accreditations in industry-recognised Money
Shield and Property Ombudsman schemes. The property management function of One Heritage is now
well established as we continue to grow our properties under management to generate increased revenue
for our stakeholders.
The Group continues to provide its tailored property sourcing service, which finds, analyses, and negotiates
property deals for overseas investors. This area has seen steady growth over recent months, and its
services are being marketed in Hong Kong under the brand ‘Red Brick’. Sixteen properties were secured for
investors during the period under review which generated over £30,000 in revenue for the Group.
Services such as sourcing, property transactions and project management to investors in Co-living
properties (typically single-dwelling suburban houses which are repurposed as shared accommodation for
young professionals) continue to be provided. While we remain committed to advancing Co-living projects,
rising house prices and construction costs have seen a reduction in activity levels since the beginning of
the calendar year.
We have examined various ways to adapt our strategy to these more challenging market conditions
including a recent trial providing Serviced Accommodation services. We will be providing a further update
on this business segment in due course.
Our people
There has been a number of personnel changes at a senior level during the year. At the beginning of the
period under review, Anthony Unsworth joined the Company as CFO and an Executive Director. Anthony
has brought financial and listed company expertise to the Company and paired with his track record in
property development, he has proved to be invaluable to us all here at One Heritage. In September 2023,
Anthony informed the Board of his decision to resign, but will continue in these roles during his notice
period ending in March 2024. The Board has commenced a search for a replacement.
ONE HERITAGE GROUP PLC
8
With his wealth of experience and in-depth understanding of the property and regeneration marketplace,
we were delighted to announce the arrival of Paul Westhead on an initial interim basis to oversee the
delivery of our development projects, Paul has provided invaluable support to the Group in the
restructuring of the development team and the project delivery element of our development process. It is
intended that his role will be carried out on a permanent basis and we will provide an update on this in due
course.
Post period end in July, we welcomed Geoff Willis into a new role of Investment Director, strengthening
the senior team. With his experience and expertise complementing our existing team, Geoff will help us to
source and deliver new development opportunities.
2024 FINANCIAL YEAR STRATEGIC OBJECTIVES
The Group continues to evolve and navigate through a very challenging market. We will continue to focus
on the delivery of our development projects and growing our development pipeline, both as developer and
as Development Manager, will be one of our primary objectives.
The following four objectives will remain in place for the forthcoming financial year.
1. Successfully deliver our development projects
2. Secure sales of our properties
3. Grow the pipeline of new development opportunities
4. Increase revenue generated through the Group’s service provisions
INDUSTRY OVERVIEW
Over the 12 months leading up to June 2023, the UK economy experienced a 1% increase in economic
output, 0.8% higher than it was in February 2020 before the pandemic struck. The economic outlook for the
remainder of 2023 and into 2024 is uncertain with persistent inflationary pressures leading to increased
prices. The decisions made by the government and the Bank of England regarding economic policies and
interest rates will be crucial in curbing inflation, with a particular focus on the Autumn Statement. HM
Treasury's August consensus economic forecasts indicated limited GDP growth of just 0.3% in 2023 and
0.6% in 2024.
The shortage of housing in the UK remains a significant issue, evident from the long-term trend of rising
house prices relative to incomes and the considerable inflationary pressures in the rental market. The last
reported figures for the year to March 2022 (reported by the HBF and Gov.uk annually in November) show
c.,210,100 new housing additions in England, 9.5% higher than the previous year of c.,191,800, but 4% lower
than the c.,219,100 homes from the pre pandemic data to March 2020 with supply chain limitations related
to labour and building materials limiting growth. The building of new housing remains low in the current
year due to the end of the Help to Buy programme, higher mortgage interest rates and subsequent
affordability challenges.
Although house prices reached their peak in August 2022, affordability constraints have caused them to
decline over the ten-month period ending in June 2023. According to the Nationwide Building Society, the
average UK house price decreased by 3.5% during the 12 months up to June 2023.
The shortage of new homes available for sale has generated increased demand in the rental sector,
resulting in a 10.4% average household rent increase over the year leading up to June 2023. This rent surge
ONE HERITAGE GROUP PLC
9
has affected every region of the UK, as reported by the HomeLet Rental Index, and a 22.0% increase over
the past two years leading up to June 2023. Unless there is a significant reduction in mortgage interest
rates, rental demand is expected to continue growing as potential homebuyers remain unable to purchase
homes.
A consistent and reliable land supply within a predictable planning system plays a crucial role in the
housebuilding industry. After the pandemic, planning consents reached their peak at c.,339,500 in the 12
months ending June 2021, aligning with the government's target of delivering 300,000 homes annually by
the mid-2020s. However, this level has decreased by 20% to c.,270,600 in the year ending March 2023. A
significant shift occurred following the December 2022 announcement that local housing targets were no
longer mandatory and that local authorities were no longer obligated to maintain a rolling five-year land
supply if they had a local plan in place.
There has been a significant change in mortgage interest rates, posing challenges for homebuyers seeking
mortgage financing. Bank of England data reveals that mortgage borrowing costs for new mortgages
steadily declined for over 12 years, reaching a low of 1.51% in November 2021. However, this trend reversed
sharply in less than 18 months, with the average cost of new mortgages rising to 4.64% in June 2023,
bringing mortgage interest rates to levels last observed in 2009. According to the Halifax Mortgage
Affordability Index, purchasing a new home now consumes 40.8% of after-tax income. In the upcoming
months, nominal wage growth may have a positive impact on this affordability measure, but it will
ultimately depend on the future movements of both mortgage rates and house prices.
Throughout the year to June 2023, we encountered a notable surge in build cost inflation, impacted by
supply limitations, inflationary pressures affecting labour costs and the delayed impact of a significant rise
in energy costs, which began in the autumn of 2021 and was further compounded by the conflict in Ukraine.
However, with headline inflation showing reductions we expect the rate of increase to continue to slow
over the coming year.
The construction industry is poised to confront forthcoming regulatory changes over the next three years,
notably related to biodiversity net gain and the Future Homes Standard. Starting in November 2023, new
legislation will mandate that all our developments achieve a minimum biodiversity net gain of 10%. This
requirement necessitates the development of plans to achieve a measurable improvement of at least 10%
in the site's biodiversity relative to its state before development commenced. Commencing in 2025, the
Future Homes Standard will necessitate that new homes produce between 75% and 80% fewer carbon
emissions than the standards applicable up to June 2022. Detailed requirements and performance
measurement criteria for this new standard are yet to be finalised. The timing, transition arrangements, and
industry consultation processes for this standard are pending initiation.
ESG
In November 2021, we announced our ESG policy which outlined our commitments to conducting our
business activities ethically and responsibly, and our commitment to embedding ESG initiatives both in our
day-to-day operations and across our developments. An update on each commitment is outlined below.
1. Supporting local communities and charitable organisations, particularly in regions where our
developments are located.
We continue to have a long-term relationship with Mustard Tree in Manchester which is a homelessness
charity. Our employees raised over £2,000 from initiatives including Tough Mudder, Hike for the Turkey and
Syria Appeal and various collections.
ONE HERITAGE GROUP PLC
10
2. Investing in the training and education of our workforce, as well as engaging with local schools
and colleges to support students with their career pathways.
Post year end, a new training provider and system has been implemented for regular e-learning across the
Company. We continue to support our employees with funding for their professional development which
includes AAT and ACCA qualifications.
The Group has subscribed to Stribe, an employee engagement tool which allows employees to provide
confidential feedback and gives all a fair voice. A decisive factor in choosing Stribe was their community
engagement. Each new Stribe membership provides a school with a pupil safeguarding app for free which
gives hundreds of children a voice and a safe confidential way for them to speak up within their schools.
3. Being an inclusive employer, committed to encouraging equality, diversity, and inclusion.
We were pleased to again support International Women’s Day earlier in the year with women making up
63% of our workforce. Furthermore, we are progressing our application to become a full member of the
Greater Manchester Good Employment Charter (“GMGEC”). We are undergoing an assessment by GMGEC
and expect to update on our application in due course. GMGEC are aligned with our values which include
providing opportunities for our people to grow, develop and thrive.
4. Tackling the UK’s shortage of quality residential accommodation.
We were delighted to work with Bolton NHS foundation in the period under review to provide 62 of our 88
apartments to house key workers at our Lincoln House, Bolton development.
Our Co-living offering, which has fixed weekly rents and includes all bills. continues to be an important
accommodation class for us. This has protected our tenants from rising utility costs and cost of living.
5. Considering its environmental impact, seeking ways to improve the environmental performance
of our developments and reduce our carbon footprint.
Increases in material costs cause additional pressure which is affecting the whole industry so initiatives to
improve the environmental performance of our developments are cost sensitive. Despite this we are looking
at cost effective measures and have recently implemented initiatives working with contractors to track and
monitor waste on our development projects. There have been various design changes across our
developments, and we have reviewed our specification to include energy efficient lighting and energy
efficient heating options where we can. Further assessments of specification are under review.
6. Raising the awareness of our tenants and occupiers in respect of how they can reduce their
environmental impact.
We continue to work with building managers on the strategy to engage with our tenants and occupiers
relating to their environmental impact. This includes recycling measures and awareness in home user
guides in our properties.
7. Engaging with our tenants, investors, and principal advisors to ensure awareness of their
expectations and responding accordingly.
We believe in building a culture which has ESG at its core, and this has resulted in changes across all areas
of the business and how decisions are made. Processes incorporate ESG which include budget allowances
ONE HERITAGE GROUP PLC
11
where appropriate, lessons learnt exercises, and regular audits of the advisors and consultants the Group
uses to ensure they are aligned with our values and expectations.
8. Upholding the Quoted Companies Alliance Corporate Governance Code (QCA). Further details can
be found on our company website.
9. Reviewing One Heritage’s ESG strategy and initiatives against the United Nation’s Sustainable
Development Goals, and monitoring and reporting on this.
The Group is reviewing ways to monitor and report effectively against the United Nation’s Sustainable
Development Goals. A further update will be provided next year in relation to how the Group intends to
do this.
Outlook
In our last Annual Report, I said that we continued to face the same challenges as before which showed
little sign of immediate improvement. These have continued over the last twelve months. Rising costs of
materials, interest rates and labour have all affected the industry. There are however signs of improvement
with build cost inflation expected to ease which should support viability and reduce pressure on margins.
This will help us to build our pipeline more effectively and profitably.
The diversity of our revenue sources has offered us a degree of insulation against the current market
challenges with our development management revenue performing strongly. With some viability concerns
surrounding Co-living, it is imperative the Group adapts and we have already taken steps to do so by
identifying new opportunities such as Serviced Accommodation. We are giving due focus and attention on
working with local authorities and registered housing providers to allow us to both deliver returns for our
shareholders and tackle the lack of affordable housing.
We continue to be positive about the outlook for the sector of the UK housing market in which we operate.
House prices have remained resilient for several years and with a lack of supply, especially in the North of
England, in city centres that are seeing population growth, rental values continue to be strong due to the
lack of supply. This supply shortage should support pricing and sustain strong returns for property
investors which will benefit our sales.
We will proceed with cautious optimism and as a maturing business, we are now much better placed. Market
dynamics in our view have started to stabilise which offer greater certainty around costs and values. We
have demonstrated our agility, and we will continue to adapt strategies when necessary to safeguard our
projects and stakeholders against similar disruptions in the future.
Task Force on Climate-Related Financial Disclosures (TCFD)
In light of the growing global concern over climate change and the increasing need for transparency and
disclosure regarding climate-related financial risks and opportunities, our company has made the
strategic decision to adopt the Task Force on Climate-related Financial Disclosures (TCFD) initiative. The
following outlines our comprehensive plan for implementing the TCFD framework and enhancing our
climate-related financial reporting.
The TCFD initiative was established to help organisations assess and disclose their climate-related
financial risks and opportunities, enabling investors, stakeholders, and the public to make informed
decisions. Adopting this framework demonstrates our commitment to addressing climate change and
aligning our business strategies with a sustainable and resilient future.
The Group will allocate necessary resources, including personnel, technology, and financial resources, to
support the successful implementation of the TCFD framework.
ONE HERITAGE GROUP PLC
12
The implementation steps are planned on a phased approach over the year to June 2024:
• Awareness and Training: To ensure a smooth transition, we will begin by conducting awareness
and training sessions for key personnel across various departments. These sessions will cover
the TCFD framework, its objectives, and the role of each department in the implementation
process.
• Governance and Accountability: Establish a dedicated TCFD working group or committee
responsible for overseeing the implementation and reporting process. Assign clear roles and
responsibilities within the organisation for TCFD compliance. The Board will oversee climate risks
through an agreed matrix of climate issues being deployed by management and through
quarterly measurement against the relevant KPI’s. There will be a comprehensive review and
analysis of the scheme delivery at practical completion. In terms of management oversight, a
clear Climate strategy is being finalised, and is already being used informally, that sets core KPI’s
in terms of efficiency standards, fabric first process / renewables / embodied carbon impact /
operational carbon outputs / core material choices / main contractor stats / staff travel/carbon
footprint. A separate emergency strategy is to be put in place to consider impacts & requirements
following acts of God. We already embrace methods of modern construction (MMC), along with
construction opportunities where climate and financial gain is achieved. We review suppliers
embracing new technology – such as flood resilience – as well as using improved performance
materials that improves overall operational carbon outputs. Opportunities will be reviewed where
a new project offers the chance to retain the embodied carbon.
• Risk identification will be delivered by conducting a comprehensive assessment of climate-
related risks and opportunities within our organisation. This will involve identifying potential
impacts on our operations, supply chain, and financial performance. The identification of a risk
follows other business processes to manage risk. We will work with our main contractor and
supply chain partners to understand the collective impacts on the climate. There will be clear
guidance on specifications and materials, along with controls that ensure any material
substituted into the process is reviewed and approved as appropriate.
• Risk management: No material risks have been identified at present, however all material climate
risks would be managed in line with other risk management processes proportionate to the risk
identified, with strong controls from management processes and a formal charge to the
Employers Agent (EA) to monitor KPIs.
• Climate risk assessments fit within a wider risk assessment framework, following the same
business process as other key risk areas. Through the review and analysis of all climate risks
conducted by the management team with Board oversight, all existing and potential risks will be
documented, and KPIs put in place to measure the risk. All mitigations will be reviewed and
appropriate actions agreed, where appropriate.
• Scenario Analysis: Develop climate scenario analysis models to assess the potential financial
implications of different climate scenarios on our business. This will help us identify resilience
measures and strategic adjustments.
• Data Collection and Disclosure: Enhance our data collection and management systems to ensure
the availability of accurate and reliable climate-related data. Prepare and publish TCFD-aligned
disclosures, including information on governance, strategy, risk management, and metrics and
targets.
• Integration with Strategy: Integrate climate-related considerations into our strategic planning
processes, ensuring that climate risks and opportunities are factored into business decisions and
investment strategies. Risks and opportunities identified over the short, medium & long term:
There are none identified at present, but identification processes are being enhanced as the level
of data, both internal and external, develops over time. Development KPIs are to be integrated
through future schemes. Rationale will continue to be monitored for trips and travel where
appropriate. There will be a periodic review of employee travel to work and the standard of office
space will be reviewed. The impact of climate related risks & opportunities on the business is
currently assessed to be limited.
ONE HERITAGE GROUP PLC
13
• Engagement with Stakeholders: Actively engage with our stakeholders, including investors,
customers, suppliers, and employees, to communicate our TCFD-aligned reporting and gather
feedback.
• Continuous Improvement: Establish a process for regular review and improvement of our TCFD
disclosures and strategies, ensuring they remain aligned with evolving climate risks and best
practices.
• We intend to communicate our commitment to adopting the TCFD initiative through internal and
external channels. Publish our TCFD-aligned disclosures in accordance with recommended
reporting timelines.
By adopting the TCFD initiative, our company is taking proactive steps to address climate-related financial
risks and opportunities. This comprehensive plan outlines our commitment to transparency, resilience,
and sustainability, ensuring that we are well-prepared for the challenges and opportunities that a
changing climate presents.
Jason Upton
Chief Executive
31 October 2023
Jason upton (Oct 31, 2023 21:04 GMT+8)
ONE HERITAGE GROUP PLC
14
STRATEGIC REPORT
Group’s Financial Review
Trading
For the twelve months ended 30 June 2023, revenue increased by £13.84m (+792%) to £15.59m (FY 2022:
£1.75m). This primarily reflects significant growth in development sales along with construction services.
Revenue
FY 2023
£m
FY 2022
£m
Change
£m
Change
%
Development management fee
0.70
0.23
0.47
207%
Development sales
9.99
-
9.99
-
Co-living property management
fee
1.28
0.53
0.75
-
Trading property
-
0.65
(0.65)
(100)%
Construction *
3.17
0.13
3.04
2,326%
Property services
0.33
0.16
0.17
110%
Corporate
0.12
0.05
0.07
160%
TOTAL
15.59
1.75
13.84
+792%
* Construction services revenue in in-house residential development projects to be discontinued
from H2 calendar year 2023.
Developments sales revenue remained the largest contributor to Group revenue, accounting for 64% of
total revenue. This significant growth was driven from Lincoln House, Bolton delivering £6.72m from 54
legal completions and Bank Street, Sheffield legally completing 17 sales equating to £3.27m.
Co-living property management relates to the works undertaken on Co-living properties where the Group
receives a 5.0% cost plus margin on all works undertaken and generated revenue of £1.28m (FY 2022:
£0.53m).
Further to the co-living property management fee, construction services delivered revenue of £3.17m in the
period (FY 2022: £0.13m), reflecting building activity supplied to related party Queen Street, Sheffield, a
refurbishment project where the Group is development manager.
There was an increase in development management fee income of £0.47m to £0.70m (FY 2022: £0.23m),
due to the recognition of a full year of income from an agreement made in the period to develop manage
One Victoria, Manchester. The other projects contributing to the period are North Church House, Sheffield,
and the One Heritage Tower, Salford.
Property services delivered revenue of £0.33m in FY 2023. This was driven by management fees and
transaction fees.
Statement of Comprehensive
Income
FY23
£m
FY22
£m
Change
£m
Change
%
Revenue
15.59
1.75
13.84
792%
Cost of sales
(13.91)
(1.16)
(12.75)
Cost of sales - Impairment
(1.09)
(1.30)
0.20
Gross Profit/(Loss)
0.59
(0.71)
1.30
184%
Gross margin
3.79%
(40.4)%
44.19%
Investment in associate and other
income
0.00
0.08
(0.08)
Administration costs
(2.21)
(1.48)
(0.73)
(49)%
Operating Loss
(1.62)
(2.11)
0.49
23%
ONE HERITAGE GROUP PLC
15
(Loss) before taxation
(2.14)
(2.13)
-
-
(Loss) per share (pence)
(6.2)
(6.6)
0.4
6%
The gross profit improved by £1.30m to £0.59m (FY 2022: loss £0.71m) due mainly to the completions from
Lincoln House. The impairment in the period was £1.09m (FY 2022: £1.30m) and this was broadly in line
with impairment reported in the interim results of December 2022 across the three impaired developments:
St Petersgate, Bank Street and Oscar House. The impairment was principally as a result of previously
mentioned factors of increased costs due to rising material prices, sub-contractor prices, delays
experienced and the cost of debt.
There has been a number of changes implemented in the year to reporting, risk management and
operational delivery, to better protect the Group from similar challenges in the future, most notably the
cessation of in-house construction services to both our direct development and development management
projects in favour of the appointment of a fixed-price principal contractor on all new projects. The
development at Victoria Road, Eccleshill which commenced in the period is with a fixed price principal
contractor.
The gross margin was 3.79% (FY 2022: (40.4%)), which is predominantly due to the completions on Lincoln
House offset by further impairment in the period.
Administrative expenses were £2.21m in the period (FY 2022: £1.48m). This represents an overall £0.73m
increase in overheads arising from a number of factors: a higher salary cost of £0.40m driven by an increase
in average headcount to 28 employees (FY 2022: 23) with more experienced individuals along with an £80k
increase in recruitment costs; an increase of £22k in audit fees; and an increase of £176k in professional
fees mainly due to higher consultants and software costs. The Group remains focused on a tight control of
overheads, whilst introducing some planned investment in costs to drive the revenue streams.
Administrative expenses as a proportion of revenue were 14% in FY 2023 whilst FY 2022 administrative
expenses as a proportion of revenue were 85% of turnover on lower revenues.
The operating loss decreased by £0.49m to a loss of £1.62m (FY 2022: loss of £2.11m). Finance costs were
£0.52m (FY 2022: £29k). The increase in finance cost is attributable to the Lincoln House, Oscar House and
Bank Street developments reaching practical completion in the period, and all finance costs since then are
expensed and not capitalised. The pre taxation loss amounts to £2.14m (FY 2022: £2.13m). The basic loss
per share was 6.2 pence (FY 2022: loss 6.6 pence).
Balance Sheet
The Balance Sheet structure reflects the strategy of funding development projects with a combination of
debt and equity instruments. As the Group continues to progress, and with development projects
reaching completion and realising sales, the Balance Sheet will in due course reflect the positive cash
impact of such transactions allowing funds to be recycled into new projects through targeted acquisitions.
Net assets have decreased by £1.14m from £0.57m to negative equity of £0.57m due to an increase in
borrowings funding future growth, but also recognising the prudent impairment of assets as described
earlier. The completion of properties at Lincoln House, Bank Street and Oscar House, Manchester that
have taken place in the period have commenced a shift in the Balance Sheet which will ultimately allow
for funds to be directed into targeted acquisitions as the Group moves forward. As anticipated, no
dividends have been declared in this year with losses being reported in the first three years of trading.
Development Inventory has increased by £1.40m from £15.13m to £16.57m. The key balances are at Oscar
House £6.32m (FY 2022: £4.22m) and Lincoln House £3.50m (FY 2022: £7.41m) where the projects are
completed and sale completions have taken place. The inventory balances have increased at St
ONE HERITAGE GROUP PLC
16
Petersgate £2.71m (FY 2022: £0.80m) which is a site due to practically complete in the quarter, along with
Victoria Road, Eccleshill £1.80m, which was purchased on 8 July 2022 and where construction has now
commenced.
Reported Net Assets per share decreased by 3.3p in the period to negative 1.5p (FY 2022: 1.8p).
Liquidity
The capital structure of the Group continued to evolve with the issuance of new shares in the period. On 7
July 2022, the Group issued 6.25m new ordinary shares of 1.0 pence each at an issue price of 20.0 pence
per share, raising gross proceeds of £1.25m. This additional source of finance enhanced funding in
addition to the initial placing, a corporate bond, construction finance and shareholder loan support.
The Net Debt has increased by £1.99m from £14.95m to £16.94m. This increase is supporting the planned
growth of the Group and includes:
• Interest payment £2.65m;
• A refinance of Oscar House, Manchester in line with the revised sales strategy on improved terms
to the previous loan £4.12m;
• An increase in the One Heritage Property Development shareholder loan facility of £4.19m to
£11.38m (FY 2022: £7.19m) which allowed the repayment of a higher interest loan with One
Heritage SPC of £1.23m resulting in lower interest costs. The total available facility is £14.30m,
and the drawdown recorded at 30 June 2023 illustrates headroom of £2.92m;
• The repayment of loan facilities at Lincoln House (£2.44m), Bank Street (£1.13m) and Oscar
House (£2.17m);
Net Cash outflow used in operating activities was £0.57m, primarily due to the reported loss of £2.14m.
In summary, we are beginning to realise the benefits from our development sales and development
management agreements. This gives us incremental funding flexibility to pursue our Group strategy with
renewed confidence.
Anthony Unsworth
Chief Financial Officer
31 October 2023
A Unsworth (Oct 31, 2023 12:15 GMT)
A Unsworth
ONE HERITAGE GROUP PLC
17
RISK MANAGEMENT AND PRINCIPAL RISKS
The ability of the Group to operate effectively and achieve its strategic objectives is subject to a range of
potential risks and uncertainties. The Board and the broader management team take a pro-active approach
to identifying and assessing internal and external risks. The potential likelihood and impact of each risk is
assessed and mitigation policies are set against them that are judged to be appropriate to the risk level.
Management constantly updates plans and these are monitored by the Audit and Risk Committee and
reported to the Board.
The principal risks that the Board sees as impacting the Group in the coming period are divided into six
categories, and these are set out below together with how the Group mitigates such risks.
1. Strategy: Government regulation, planning policy and land availability.
2. Delivery: Inadequate controls or failures in compliance will impact the Group’s operational and
financial performance.
3. Operations: Availability and cost of raw materials, sub-contractors, and suppliers.
4. People and culture: Attracting and retaining high-calibre employees.
5. Finance & Liquidity: Availability of finance and working capital.
6. External Factors: Economic environment, including housing demand and mortgage availability.
1. Strategy: Government regulation, planning policy and land availability
A risk exists that changes in the regulatory environment may affect the conditions and time taken to obtain
planning approval and technical requirements including changes to Building Regulations or Environmental
Regulations, increasing the challenge of providing quality homes where they are most needed. Such
changes may also impact our ability to meet our margin or site return on capital employed (ROCE) hurdle
rates (this ratio can help to understand how well a company is generating profits from its capital as it is put
to use). An inability to secure sufficient consented land and strategic land options at appropriate cost and
quality in the right locations to enhance communities, could affect our ability to grow sales volumes and/or
meet our margin and site ROCE hurdle rates. The Group mitigates against these risks by liaising regularly
with experts and officials to understand where and when changes may occur. In addition, the Group
monitors proposals by Government to ensure the achievement of implementable planning consents that
meet local requirements and that exceed current and expected statutory requirements. The Group regularly
reviews land currently owned, committed and pipeline prospects, underpinned with robust key business
control where all land acquisitions are subject to formal appraisal and approved by the senior executive
team.
2. Delivery: Inadequate controls or failures in compliance will impact the Group’s operational and
financial performance
A risk exists of failure to achieve excellence in construction, such as design and construction defects,
deviation from environmental standards, or through an inability to develop and implement new and
innovative construction methods. This could increase costs, expose the Group to future remediation
liabilities, and result in poor product quality, reduced selling prices and sales volumes.
To mitigate this, the Group liaises with technical experts to ensure compliance with all regulations around
design and materials, along with external engineers through approved panels. It also has detailed build
programmes supported by a robust quality assurance.
3. Operations: Availability and cost of raw materials, sub-contractors, and suppliers
A risk exists that not adequately responding to shortages or increased costs of materials and skilled labour
or the failure of a key supplier, may lead to increased costs and delays in construction. It may also impact
our ability to achieve disciplined growth in the provision of high-quality homes.
ONE HERITAGE GROUP PLC
18
Following a strategic review, the Group has taken the opportunity to cease our participation in in-house
construction of residential development projects, and this will take effect upon the completion of our
current projects under construction. We will continue to provide the development of Co-living projects but
have chosen a new approach to the delivery of our development projects by appointing a principal
contractor after a period of due diligence, which we believe will deliver the best shareholder value.
4. People and culture: Attracting and retaining high-calibre employees
A risk exists that increasing competition for skills may mean we are unable to recruit and/or retain the best
people. Having sufficient skilled employees is critical to delivery of the Group’s strategy, whilst maintaining
excellence in all of our other strategic priorities.
To mitigate this the Group has a number of People Strategy programmes which include development,
training and succession planning, remuneration benchmarking against competitors, and monitoring of
employee turnover, absence statistics and feedback from exit interviews.
5. Finance & Liquidity: Availability of finance and working capital
A risk exists that lack of sufficient borrowing and surety facilities to settle liabilities and/or an ability to
manage working capital, may mean that we are unable to respond to changes in the economic environment,
and take advantage of appropriate land buying and operational opportunities to deliver strategic priorities.
To minimise this risk, the Group has a disciplined operating framework with an appropriate capital
structure, and management have stress tested the Group’s resilience to ensure the funding available is
sufficient. This process has regular management and Board attention to review the most appropriate
funding strategy to drive the Group’s growth ambitions. We have regular monthly Treasury updates, and
we gain market intelligence and availability of finance from experienced sector Treasury advisers.
6. External Factors: Economic environment, including housing demand and mortgage availability
A risk exists that changes in the UK macroeconomic environment may lead to falling demand or tightened
mortgage availability, upon which most of our customers are reliant, thus potentially reducing the
affordability of our homes. This could result in reduced sales volumes and affect our ability to deliver
profitable growth.
To mitigate this risk, the wider Group has a significant presence in Hong Kong, China and Singapore and
the majority of overseas purchasers are cash buyers. The Group continually monitors the market at Board,
Executive Committee, and team levels, leading to amendments in the Group’s forecasts and planning, as
necessary. In addition, there are comprehensive sales policies, regular reviews of pricing in local markets
and development of good relationships with mortgage lenders. This is underpinned by a disciplined
operating framework with an appropriate capital structure and strong Balance Sheet.
Anthony Unsworth
Chief Financial Officer
31 October 2023
A Unsworth (Oct 31, 2023 12:15 GMT)
A Unsworth
ONE HERITAGE GROUP PLC
19
DIRECTORS’ REPORT
Board of Directors
EXECUTIVE DIRECTORS
JASON UPTON
Chief Executive
Appointed: 21 July 2020
Jason has extensive management experience, specialising in Operations Management and Business
Development with experience in Debt Management, Financial Services, Banking and Property Development
Industries.
From 2009 to 2016, he was Operations Manager for Totemic Financial Services Limited in the UK.
Subsequent to that role, from 2016 to 2019, he was CEO of J Upton Limited, working as a management
consultant in the Financial Services and Banking Industry, notably within Nationwide Building Society. In
June 2019, Jason became the CEO of One Heritage Property Development (UK) Limited.
Jason graduated from the University of Lincoln in the United Kingdom with an Honours Bachelor’s Degree
in Business and Marketing.
YIU TAK CHEUNG
Chief Investment Officer
Appointed: 21 July 2020
Peter is based in the UK and Hong Kong. He has extensive experience in Business Development, budget
planning and Operations Management in the Wealth Management industry. From 2009 to 2014, he was an
Associate Director of Convoy Financial Services Limited, a listed financial services company on the Hong
Kong Stock Exchange. Following that he was a Senior Vice President of Hong Kong based Get Mdream
Wealth Management Limited which is a diversified Wealth Management business focusing on the Asian
market. In 2016, Peter became CEO of One Heritage Property Development Limited.
Peter graduated from the University of Lincoln in the UK with an Honours Bachelor’s Degree in Business
and Marketing.
ANTHONY UNSWORTH
Chief Financial Officer
Appointed: 1 August 2022
Anthony is an Associate of the Chartered Institute of Management Accountants and has over 14 years’
experience with FTSE 100 and 250 listed House Builders. His most recent role was at Countryside
Partnerships PLC where he was the Divisional Finance Director, Partnerships North and oversaw significant
change through organic and acquisitive growth. Prior to joining Countryside, Anthony held the role of
Finance Director North West from 2007 until 2018 at Barratt Developments PLC and was responsible for
financial leadership through this period of considerable growth.
Anthony also has a further twenty years of financial and commercial experience across multiple sectors
including retail, banking and manufacturing with senior finance roles held at Asda Stores Ltd, Iceland Foods
Ltd and The Very Group Ltd. He is highly experienced in financial matters and his core disciplines include
ONE HERITAGE GROUP PLC
20
strategic planning and forecasting, treasury, working capital control, governance, and risk management. In
September 2023, Anthony informed the Board of his decision to resign from his role as CFO and Executive
Director but will continue in these roles during his notice period ending in March 2024. The Board has
commenced a search for a replacement.
NON-EXECUTIVE DIRECTORS
DAVID IZETT
Independent non-executive Chairman
Appointed: 17 December 2020
Committees: Audit and Risk Committee, Remuneration Committee, Nomination Committee
David is a fellow of The Royal Institution of Chartered Surveyors, with more than forty years’ experience of
the real estate industry, both in the UK and internationally, including Russia and Central Asia. He was Chief
Executive Officer of Colliers International UK plc from 2001 to 2010, including being EMEA Chairman of
Colliers International UK plc from 2005 to 2010.
David subsequently became a Business Development Partner for Cushman & Wakefield plc London in 2011
prior to becoming Chief Operating Officer of Cushman & Wakefield Moscow in 2012. He was Chair of the
Cushman & Wakefield affiliate in Georgia and Kazakhstan before returning to the UK in 2016 where he now
holds a number of Board and consultancy roles with businesses in the real estate industry.
JEREMY EARNSHAW
Independent non-executive Director FCA, B. Eng (Hons)
Appointed: 1 April 2022
Committees: Audit and Risk Committee, Remuneration Committee, Nomination Committee
Jeremy is a Fellow of The Institute of Chartered Accountants in England & Wales and has over thirty
years’ senior treasury, finance, and governance expertise, in both public and private sector
organisations. He has worked across multiple sectors including Housing, Healthcare, Pharmaceuticals,
Printing, Retail Marketing and Online E-Commerce. Jeremy is highly experienced in all Main Board and
CFO matters, with specialisms in funding, M&A, stakeholder communication and value creation. With
international experience in Europe, North America and Asia, Jeremy’s roles have always encompassed a
wide range of responsibilities, including legal, governance, risk, financial PR, and procurement.
Additionally, Jeremy is a Non-Executive Director at Optoma, and a Non-Executive Director at 54 North
Homes, a Regulated Housing Association in the North of England.
ONE HERITAGE GROUP PLC
21
DIRECTORS’ REPORT
QCA Corporate Governance Code
The Board recognises the value of good corporate governance and adopted the QCA Corporate Governance
Code on listing. The Code sets out ten principles that are designed to help deliver long term growth in
shareholder value. Below we set out each of the principles and how the Group sets out to achieve them.
Principle
Application
DELIVER GROWTH
1
Establish a strategy and
business model which
promote long-term value for
shareholders
The Group’s strategy is focused on developing high quality
apartments and Co-living housing in urban areas in the UK with
high demand from professional tenants. We provide first class
letting and full management services to create a socially
sustainable living environment.
The Group aims to deliver shareholder value by investing in
developments in areas of high demand and growth. The Group
also believes that it can create value in the residential market and
are excited to be part of the solution to tackling the UK’s shortage
of quality accommodation.
2
Seek to understand and meet
shareholder needs and
expectations
The Group provides its shareholders with contact information
such as a dedicated email address (investors@one-heritage.com),
Group phone number and address which is available on the
Group’s website. The Group holds an Annual General Meeting
which all investors can attend, and time will be set aside for
questions.
Due to the size of the Group, there is no dedicated investor
relations department. The CEO is responsible for reviewing all
communications received from investors and will determine the
most appropriate response.
Individual contact details of the CEO, CFO and Hybridan, the
Group’s financial adviser are published on all RNS releases which
are also uploaded to the Company website.
3
Take into account wider
stakeholder and social
responsibilities and their
implications for long-term
success
The Group believes its main stakeholders in addition to its
investors are its employees, suppliers, consultants, purchasers of
the Group’s properties, members of local communities where the
Group undertakes development activities, and their tenants. The
Group is committed to understand the requirements and needs of
its stakeholders, monthly meetings are held by management to
discuss engagement and feedback and the Group takes time to
review these requirements.
It is important for the Group to be making a positive contribution
to local economies, communities, and
Principle
Application
DELIVER GROWTH
the housing shortage. The Group recognises its social
responsibility and the impact it has on providing sustainable
housing, follow best practice so that developments provide a safe
and environmentally friendly living experience. Development
ONE HERITAGE GROUP PLC
22
proposals are in line with planning regulations and
recommendations where future regulations may change, and
where advisable, the Group will hold public consultation events
as part of any planning applications.
4
Embed effective risk
management, considering
both opportunities and
threats, throughout the
organisation
The Group maintains a risk register and monitors risks associated
with the business including finance, legal, personnel, and macro
and micro environmental factors. Risks are assessed and
discussed at management and Board level on a regular basis,
assessing the impact, likelihood and the mitigation strategies are
carefully considered. The risk register is tabled at the Group’s
audit committee for further assurance as to the strength and
sustainability of its management strategy to risk. The audit
committee is expected to meet at least three times a year at
appropriate intervals in the financial reporting and audit cycle and
otherwise as required.
MAINTAIN A DYNAMIC MANAGEMENT FRAMEWORK
5
Maintain the Board as a well-
functioning, balanced team
led by the chair
One Heritage Group PLC has a Board of Directors that comprises
three executive Directors and two Independent non-executive
Directors which includes an Independent non-executive
chairman. The Board is committed to meeting at least monthly
formally or informally. Under Article 78.1 of the Company’s
Articles of Association each director shall retire from office at the
third annual general meeting after the annual general meeting or
general meeting (as the case may be) at which he was previously
appointed. Any new Directors appointed during the year must
stand for re-appointment at the annual general meeting following
their appointment. The Company intends to comply with its
Articles of Association and guidance set by the QCA code.
The Executive Directors consist of a full-time CEO and CFO along
with a part time CIO. The Independent Non-executive Directors
consist of an Independent Non-Executive Chairman and an
Independent Non-Executive Director with service contracts that
require a minimum of two days a month dedicated towards their
duties as Directors of the Group.
Each Director of the Group has particular regard to the QCA
Corporate Governance Code in respect of the role of the Board
and the role of its Independent non-executive Directors. As the
Company continues to grow, Board membership will be
continually assessed to reflect the skills and attributes required.
Audit and Risk Committee
The Company has established an audit and risk committee, which
comprises all of the Directors and Jeremy Earnshaw as the
Chairman. The audit committee will meet at least three times a
year and will assist the Board in observing its responsibility for
ensuring that the Company’s financial systems
Principle
Application
MAINTAIN A DYNAMIC MANAGEMENT FRAMEWORK
provide accurate and up-to-date information on its financial
position and that the published financial statements represent a
true and fair reflection of this position. It will also assist the Board
in ensuring that appropriate accounting policies, internal financial
controls and compliance procedures are in place. The audit
committee will receive information from the external auditors and
ONE HERITAGE GROUP PLC
23
will seek to challenge the management where necessary. The
Committee will also consider any new or potential risks posed to
the Company and will identify the mitigants and controls
necessary to ensure that such risks are managed in a manner
appropriate to the size and complexity of the Company’s
operations at that time.
Remuneration Committee
The Company has established a Remuneration Committee, which
will comprise the two independent non-executive Directors, those
being Jeremy Earnshaw and David Izett (Chair). The
Remuneration Committee will meet at least twice a year and
otherwise as required.
The Remuneration Committee has responsibility for making
recommendations to the Board on the Group’s policy on the
remuneration of the executive Directors. The Remuneration
Committee is responsible for reviewing the scale and structure of
the executive Directors’ remuneration and the terms of their
service or employment contracts, including share option schemes
and other bonus arrangements. The entire Board sets the terms
and conditions of the remuneration of the Directors.
Nominations Committee
The Nominations Committee will meet at least once a year and
otherwise as required. The committee consists of two members.
The chairman of the Nominations Committee must either be an
independent Director or the Chairman of the Board (save when
discussing his succession). Accordingly, David Izett has been
appointed as Chairman of the Nominations Committee, the other
member being Jeremy Earnshaw. The Nominations Committee
considers the composition of the Board, retirements and
appointments of additional and replacement Directors and makes
appropriate recommendations to the Board. In addition, the
Nominations Committee will recommend changes to the Board
where specific skills and experiences are required to achieve the
Company’s future development plans.
Principle
Application
MAINTAIN A DYNAMIC MANAGEMENT FRAMEWORK
6
Ensure that between them the
Directors have the necessary
up-to-date experience, skills,
and capabilities
The Board bring relevant experience in the property sector,
finance sector, business operations and the public markets. The
Directors of the Group comprise a mixture of young,
entrepreneurial, and dynamic executive Directors who founded
the Group which is balanced by the experience of two
Independent non-executive Directors with significant public
markets experience. The Group believes that this cognitive
diverse experience of the Board provides a sufficient balance to
promote the success of the business.
Each Director is identified on the Company’s website along with a
clear description of their role and experience.
The Group has access to a financial advisor to update the Board
on key business, legal and regulatory issues facing the Group. The
ONE HERITAGE GROUP PLC
24
Board also has access to the Company Secretary, who advises
them on Board and governance matters. The Group also consults
its legal advisers that it retains on all matters legal, regulatory and
governance.
The Group has not to date sought external advice on keeping
Directors’ skills up to date, but believes that the mix of experience
provides them with the relevant up to date skills needed to act as
Board members for a small Group.
7
Evaluate Board performance
based on clear and relevant
objectives, seeking continuous
improvement
The Group’s Directors are evaluated against the Group strategy
as outlined in the prospectus dated 23 December 2020. The Board
intends to consider how formal assessments of Board
performance will be conducted in the future and will also consider
succession planning as and when necessary. The Board has
started to think how to best evaluate its Board Members Exec and
Non exec and part of that has been some housekeeping with
respect to Directors standing for re election at annual GMs in line
with Articles etc, but that along with wider options for exec
directors, performance criteria and performance of non-exec
directors and how to measure this is a live and ongoing Board
topic and will hopefully lead to formal appraisal processes being
in place by the end of 2024.
8
Promote a corporate culture
that is based on ethical values
and behaviours
The Board believes that the promotion of a corporate culture
based on sound ethical values and behaviours is critical to gain a
competitive advantage and maximise shareholder value. The
Group maintains a handbook which is available to all employees
which sets out standards expected which are a benchmark for the
evaluation of performance during periodic employee reviews
which are undertaken at least annually. Senior management hold
an Employee Engagement meeting monthly with staff matters,
employee feedback, employee engagement and professional
training/development all standing agenda items. The CEO also
reports on any notable examples of actions within the Group that
are misaligned with the Group’s stated values at every Board
meeting.
Principle
Application
MAINTAIN A DYNAMIC MANAGEMENT FRAMEWORK
The Directors believe its corporate culture encourages ethical
behaviours that benefit its stakeholders and promote the success
of the business.
9
Maintain governance
structures and processes that
are fit for purpose and support
good decision-making by the
Board
The Chairman is responsible for leadership of the Board, ensuring
its effectiveness and setting the agenda for Board meetings. Once
strategic objectives have been agreed by the Board, it is the Chief
Executive Officer’s responsibility to ensure they are delivered
upon consistently to be accountable to the Board. The day-to-day
operations of the Group are managed by the Chief Executive
Officer and the wider management team comprising the Chief
Investment Officer, Chief Financial Officer, and Development
Director.
There is a clear division of responsibilities between the Chairman,
Chief Executive Officer, and Non-Executive Directors. The roles of
the Chairman and the Chief Executive Officer are separate with a
ONE HERITAGE GROUP PLC
25
distinct division of responsibilities. The separation of authority
enhances independent oversight of the executive management by
the Board and helps to ensure that no one individual on the Board
has unfettered authority.
The Board’s primary role is the protection and enhancement of
long-term shareholder value. To fulfil this role, the Board is
responsible for the overall management and corporate
governance of the Group including its strategic direction,
establishing goals for management, and monitoring the
achievement of these goals. In addition to overall Group strategy,
the Board approves the annual budget and retains control over
corporate activity, material contracts and financing decisions.
Management’s role is to implement the strategic plan established
by the Board and to work within the corporate governance and
internal control parameters established by the Board.
The role of each of the Group’s committees have been explained
in Principle 5 above.
BUILD TRUST
10
Communicate how the
company is governed and is
performing by maintaining a
dialogue with shareholders
and other relevant
stakeholders
The Group publishes all RNS announcements, prospectuses, and
investor presentations on the Group’s website. The Group
releases Annual Reports holds Annual General Meetings, and all
circulars, dates and content will be posted directly to all
shareholders and nominees and published on the Group’s
website.
The Group website allows investors, stakeholders, and other
interested parties to contact the Group. The Group is in the
process of creating a mailing list to contact stakeholders directly,
which is expected to be in place by June 2024.
ONE HERITAGE GROUP PLC
26
DIRECTORS’ REPORT
Board Leadership and Company Purpose
ROLE OF THE BOARD
The responsibility of the Board is to promote the success of the Company for the long-term benefit of its
shareholders and other stakeholders, including employees, suppliers, and the wider community. The Board
see its role as reviewing and approving key policies, setting the strategy and operating plans, ensuring
governance and compliance with laws and regulations, and through its committees the financial reporting
and risk management, and, importantly, the culture of the Company.
The Board has regular scheduled and ad hoc meeting as well as committee meetings to ensure that
Director’s allocate sufficient time to discharge their duties effectively. The agenda of these meetings is
managed to ensure that shareholder value, the considerations of stakeholders, and governance play a key
part in the decision making of the Company.
Meetings are scheduled to coincide with key events in the Company’s financial calendar, including interim
and final results and the AGM. The Board also schedule other meetings during the year that review budgets,
financial and operating performance, strategy as well as major transactions.
PURPOSE
The Company’s purpose is to expand and enhance residential property, primarily in the North. This is
through investing in the refurbishment or construction of accommodation that matches the needs of the
local area. The Board receives regular updates on the performance and given the limited trading history of
the Group, using a range of different KPI’s to build a picture of performance and ensure that shareholder
and stakeholder value is maximised. The Board reviews all proposed developments and all Board members
are encouraged to visit sites to gain a better understanding of the environment and local area.
SECTION 172(1) STATEMENT
In accordance with section 172 of the Companies Act 2006, the Board regularly considers the likely
consequences of our strategy and long-term decisions, taking into account the interests of employee
colleagues, suppliers, customers, communities, and the environment.
The table below considers key stakeholder groups, methods of engagement and the impact of feedback
on Board discussions and decisions.
Matters considered by the Board
Where to read more in
the Annual report
The interests of the Group’s employees
CEO and Remuneration
Committee Reports
The impact of the Group’s operations on the community and the
environment
CEO Report
Maintaining high levels of Corporate Governance
QCA Corporate
Governance Code
The long-term strategy of the Group
CEO Report
DISCLOSURE OF INFORMATION TO AUDITOR
The Directors who held office at the date of approval of this Directors’ report confirm that, so far as they
are each aware, there is no relevant audit information of which the Company’s auditor is unaware; and
each Director has taken all the steps that he ought to have taken as a Director to make himself aware of
any relevant audit information and to establish that the Company’s auditor is aware of that information.
ONE HERITAGE GROUP PLC
27
CULTURE
The Board believe that building the right culture in the Company that is aligned with the strategy and
purpose of the Company is pivotal to creating value. It aims to foster an open environment, where all staff
understand the strategic direction of the business and contribute towards reaching its goals. This is through
regular communication by the Board and Senior Leadership to all staff to encourage strategic engagement
across the Company. The Board receives regular updates and has input on how the Company’s culture and
its values create an environment for collaborative engagement, creative thinking, and integrity. The Board
is of the view that the culture is open, supportive, and transparent, is led from the top, and works across
the business.
SHAREHOLDER RELATIONS
The Company listed on the London Stock Exchange in December 2020 and has ongoing dialogue with its
investors, which became part of the story of a rapidly growing business. The Board uses Investor Meet
Company, which allows shareholders to watch and ask questions. The Company is yet to hold its first in
person AGM. Meeting shareholders in person is a key priority in the new financial year.
WORKFORCE ENGAGEMENT
The Board believe passionately that engagement with the whole workforce is pivotal to the future success
of the Company. It promotes improved decision making at all levels and ultimately is key to attracting and
retaining the best staff. The pandemic has demonstrated how important engagement is when employees
are expected to be more flexible and adaptive than they ever have.
CONFLICTS OF INTEREST
Directors are required to report actual or potential conflicts of interests to the Board for consideration and
the Company maintains a register of authorised conflicts of interest. The Chairman notes the Register and
reminds Directors of their duties under the Companies Act 2006 relating to the disclosure of any conflicts
of interest at the beginning of each Board meeting.
INDEPENDENT ADVICE
Directors can raise concerns at Board meetings and have access to the advice of the Company Secretary.
There is an established procedure for Directors, in relevant circumstances, to obtain independent
professional advice at the Company’s expense. No such requests were made in financial period to 30 June
2022.
Directors’ and Officers’ Liability Insurance is maintained for all Directors.
BOARD BALANCE AND INDEPENDENCE
Details of the Directors, including their qualifications and experience, are set out in the Board of Directors
section of this report. The Board currently comprises the Chairman, three Executive Directors and a Non-
Executive Director.
The Board reviews the independence of its Non-Executive Directors on an annual basis and has concluded
that all Non-Executive Directors continue to demonstrate their independence.
In the Company’s view, the breadth of experience and knowledge of the Chairman and the Non-Executive
Director and their detachment from the day-to-day issues within the Company provide a sufficiently strong
and experienced balance with the executive members of the Board.
CHAIRMAN
▪ Provide effective leadership and maintain a culture of openness, debate and constructive challenge
▪ Set the agenda, style and tone of Board meetings and ensure Directors receive timely, accurate
and clear information to assist decision-making
▪ Monitor the Board’s effectiveness
ONE HERITAGE GROUP PLC
28
CHIEF EXECUTIVE OFFICER
▪ Day-to-day responsibility for managing the business of the Group
▪ Recommend the Group’s strategy to the Board and implement the agreed strategy across the
Group
▪ Provide regular updates to the Board on all operational matters of significance
▪ Deliver the Group’s ESG strategy
▪ Ensure effective communication with the Group’s shareholders and stakeholder
CHIEF FINANCIAL OFFICER
▪ Day-to-day responsibility for managing the financial actions of the Group
▪ Track and manage cash flows
▪ Deliver short-, medium- and long-term financial plans aligned to the strategy
▪ Analyse the Group’s financial strengths and weaknesses and propose corrective actions
▪ Ensure the Group’s financial reports are accurate and compiled in a timely manner
NON-EXECUTIVE DIRECTOR
▪ Act as a sounding board to the Chairman
▪ Evaluate the Chairman’s performance as part of the annual Board evaluation process
▪ Provide independent judgement, knowledge and commercial experience to discussions and
decision-making
▪ Provide constructive challenge to Executive Directors and scrutinise the performance of
management against key objectives
▪ Provide oversight of the Group’s strategy
BOARD AND COMMITTEE STRUCTURE
Audit and Risk Committee
Meets at least three times a year
Chairman – Jeremy Earnshaw
Members – David Izett
Nomination Committee
Meets at least once a year
Chairman – David Izett
Members – Jeremy Earnshaw
Remuneration Committee
Meets at least once a year
Chairman – David Izett
Members – Jeremy Earnshaw
Terms of reference for all committees are available on the Company’s website.
BOARD AND COMMITTEE MEETINGS
The number of scheduled meetings of the Board in the year to 30 June 2023
Board
Audit and Risk
Nomination
Remuneration
Number of meetings
5
4
1
1
David Izett
5
4
1
1
Jason Upton
5
1/1
-
-
Yiu Tak Cheung
5
1/1
-
-
BOARD
AUDIT AND RISK
COMMITTEE
NOMINATION
COMMITTEE
REMUNERATION
COMMITTEE
SENIOR LEADERSHIP TEAM
ONE HERITAGE GROUP PLC
29
Jeremy Earnshaw
Anthony Unsworth (1)
5
4/4
4
-
1
-
1
-
Notes:
1. (1) Appointed 1
st
August 2023, not eligible to attend the July 2022 meeting
2. In October 2022 the Audit and Risk Committee decided that only NEDs would be members of the
ARC therefore Jason Upton and You Tak Cheung were only able to attend one meeting as a
participant
In advance of Board meetings, an agenda is sent out to each member along with up-to-date financial and
commercial information, management accounts, budgets and forecasts, details of potential or proposed
acquisitions and disposals, cash flow forecasts and details of funding availability.
Each Board meeting includes the Executive Directors and Senior Leadership providing key updates on their
areas of responsibility.
The Committee Chairs highlight any matters that require consideration of the Board, which are added to
the agenda of the next scheduled Board meeting, or if required an ad hoc meeting called.
DIRECTORS’ INSURANCE AND INDEMNITY
The Group maintains Directors’ and Officers’ liability insurance which gives appropriate cover for any legal
action brought against its Directors. In accordance with Section 234 of the Companies Act 2006, qualifying
third party indemnity provisions are in place for the Directors in respect of liabilities incurred as a result of
their office to the extent permitted by law.
POLITICAL DONATIONS
No political donations have been made during this financial year.
AUDITOR
Our External Auditor is KPMG Audit LLC, and they were appointed in financial year 2021. The Committee
considers the external Auditor to be independent. In the current financial year, the External Auditor did not
provide any non-audit services to the Group.
In accordance with Section 489 of the Companies Act 2006, a resolution for the re-appointment of KPMG
Audit LLC as auditor of the Company is to be proposed at the forthcoming Annual General Meeting.
GOING CONCERN
Notwithstanding net current liabilities of £5.8 million (excluding inventory balances totalling £16.0 million)
as at 30 June 2023, a loss for the year then ended of £2.7 million and operating cash outflows for the year
of £2.0million, the financial statements have been prepared on a going concern basis which the Directors
consider to be appropriate for the following reasons.
The Directors have prepared a cash flow forecast for the period to 31 December 2024 which indicates that,
taking account of reasonably possible downsides, the Group will have sufficient funds, through the
proceeds from sale of four developments (net of repayment of related construction finance loans (note 19)),
supplemented by continued financial support from its parent company, One Heritage Property
Development Limited (“OHPD”), to meet its liabilities as they fall due for that period. OHPD have confirmed
that their loans due to mature in December 2024 will not be demanded for repayment until such a time that
the Group can afford to repay them without impacting on its going concern.
As with any company placing reliance on other Group/related entities for financial support or third-party
loan counterparties extending the maturity dates in line with their indications, the Directors acknowledge
that there can be no certainty that this support will continue although, at the date of approval of these
financial statements, they have no reason to believe that it will not do so.
ONE HERITAGE GROUP PLC
30
Consequently, the Directors are confident that the Group will have sufficient funds to continue to meet its
liabilities as they fall due for at least 12 months from the date of approval of the financial statements and
therefore have prepared the financial statements on a going concern basis.
SHARE CAPITAL AND PRINCIPAL SHAREHOLDER
The number of shares in issue as at the date of publication of this report was 38,678,333 ordinary shares of
1 pence, each with one vote.
One Heritage Property Development Limited is the Company’s principal shareholder, holding a total of
25,200,000 ordinary shares, representing 65.3% of the voting rights attached to the current issued share
capital of the Company.
ONE HERITAGE GROUP PLC
31
DIRECTORS’ REPORT
Nomination committee report
The Nomination Committee supports the composition, succession and competences of the Board and
Senior Leadership. This committee has two members; the chair, David Izett, and Jeremy Earnshaw.
PURPOSE AND KEY RESPONSIBILITIES
• Regularly review the structure, size, and composition (including the skills, knowledge, experience,
and diversity) of the Board;
• Consider and recommend succession planning for Directors and other senior executives in the
course of its work, taking into account the challenges and opportunities facing the Company, and
the skills and expertise needed on the Board in the future;
• Keep under review the leadership needs of the organisation, both executive and non-executive,
with a view to ensuring the continued ability of the organisation to compete effectively in the
marketplace; and
• Responsible for identifying and nominating for the approval of the Board, candidates to fill Board
vacancies as and when they arise.
ACTIVITIES DURING THE YEAR
The Nomination Committee held one meeting in this financial year. The Nomination Committee met on the
27 July 2022 to appoint Anthony Unsworth as Executive Director and Chief Financial Officer of the
Company. He was provided with reading material as part of his induction and met the other Directors, the
executive leadership team, and other senior members of the Company. Succession planning was reviewed
and discussed however given the size, stage of development and age of the Company no actions were
recommended. While no formal structured continuing professional development programme has been
established for the non-executive Directors, every effort is made to ensure that they are fully briefed before
meetings on the Group’s business. In addition, they receive updates from time to time from the executive
Directors on specific topics affecting the Group and from the Company Secretary on recent developments
in corporate governance and compliance.
The Company’s Articles of Association provide for each Director to retire from office at the third annual
general meeting (“AGM”) after the AGM at which he or she was previously appointed or reappointed. The
Nomination Committee has recommended that in line with best Corporate Governance practice, all
Directors will offer themselves for re-election by the shareholders at the third annual general meeting after
the AGM at which he or she was previously appointed or reappointed. Given the recent changes to Board
composition during the year, it was felt that a Board evaluation would not provide added value, but this
will be kept under review for the year ahead.
ONE HERITAGE GROUP PLC
32
DIRECTORS’ REPORT
Audit and risk committee report
The Audit and Risk Committee role is to assist the Board in discharging its duties and responsibilities for
financial reporting, internal control and the appointment and remuneration of an independent external
Auditor. This committee has two members; the chair, David Izett and Jeremy Earnshaw. In October 2022,
the Audit and Risk Committee decided that only NEDs would be members of the ARC therefore the
Executive Directors were only able to attend by invitation.
PURPOSE AND KEY RESPONSIBILITIES
▪ Monitor the integrity of the financial statements of the Company, including its annual and half-
yearly reports, interim management statements, preliminary announcements and any other formal
statements relating to its financial performance;
▪ Review the effectiveness of the Group’s system of internal financial controls that identify, assess,
manage, and monitor financial risks, and other internal control and risk management systems;
▪ Consider and make recommendations to the Board, for it to put to shareholders for their approval
at the AGM, in relation to the appointment, re-appointment and removal of the Company’s external
auditor; and
▪ Review the adequacy and security of the Company’s arrangements for its employees to raise
concerns, in confidence, about possible wrongdoing in financial reporting or other matters.
ACTIVITIES DURING THE YEAR
The Audit and Risk Committee held four meetings during the financial period to 30 June 2023. The
highlights included:
- Reviewing and recommending approval of the Annual and Interim Report to the Board for release
to the market;
- Approving a detailed timetable for the annual audit and setting regular milestones to be met by
the Executive Directors, Senior Leadership and Auditors; and,
- Reviewing the Company’s Risk Register and ensuring that the Executive Director’s and Senior
Leadership are effectively managing risks in the Company.
SIGNIFICANT ISSUES CONSIDERED IN RELATION TO THE FINANCIAL STATEMENTS
-
Impairment of inventory - developments
: The Audit and Risk Committee highlighted that there is
a significant risk around the carrying value of the inventory balances. The analysis required
references to information that is inherently using varying levels of estimation and therefore may
be subject to management bias. During the period, the Audit and Risk Committee reviewed all
assumptions used and sought independent advice where required to ensure that the values used
were in line with market expectations.
-
Going concern
: The Committee reviewed, challenged and concluded on the Group’s going concern
review. This process included giving due consideration to the appropriateness of key judgements,
assumptions and estimates underlying the budgets and projections that underpin the Group’s
going concern assessment.
-
Recoverability of Parent Company’s loan to and investment in subsidiaries
: The Committee noted
the materiality of the balances. It was judged, after reviewing the financial information of the
subsidiaries, that the risk was low.
ONE HERITAGE GROUP PLC
33
RISK MANAGEMENT
The Board is responsible for maintaining a sound system of internal control and risk management. Such a
system is designed to manage, but not eliminate, the risk of failure to achieve business objectives. There
are inherent limitations in any control system and, accordingly, even the most effective system can provide
only reasonable, and not absolute, assurance.
An ongoing process is in place for identifying, evaluating and managing risk and the Board is satisfied that
this accords with relevant corporate governance guidance. Key features of the Group’s system of internal
control are as follows:
▪ Defined organisational responsibilities and authority limits. The day-to-day involvement of the
Executive Directors in the running of the business ensures that these responsibilities and limits are
adhered to;
▪ Financial and operating reporting to the Board, including the preparation of budgets and forecasts,
cash management, variance analysis, property, taxation, and reports on financing. Year-end and
interim financial statements are reviewed by the Audit Committee and discussed with the Group’s
Auditor, KPMG Audit LLC, before being submitted to the Board for approval;
▪ Review and approval of the Group’s risk register by the Group’s Management Team, the Audit and
Risk Committee and the Board;
▪ Anti-Bribery and Corruption policies which are communicated to all staff and for which compliance
reviews are conducted on an annual basis; and
▪ The Group’s whistleblowing policy.
ONE HERITAGE GROUP PLC
34
DIRECTORS’ REPORT
Remuneration committee report
The Remuneration Committee agrees the framework for the remuneration of the Chairman, Non-Executive
Directors and the Executive Directors. The Committee approves salaries and sets the levels, conditions and
performance objectives for the annual bonus and share awards for Executive Directors. The Committee
also reviews the remuneration of the senior leadership below Board level. It also makes recommendations
to the Board on matters that require shareholder approval. This committee has two members; the chair,
David Izett and Jeremy Earnshaw.
PURPOSE AND KEY RESPONSIBILITIES
▪ Responsibility for setting the remuneration policy for all Executive Directors and recommend and
monitor the level and structure of remuneration for the Senior Leadership; and
▪ Review and monitor any significant changes to the benefit structure of the Company and review
its appropriateness to a Company of this size and scope.
ACTIVITIES DURING THE YEAR
The Remuneration Committee met once in the financial period to 30 June 2023. It reviewed the overall
Company’s remuneration that was proposed by the Executive Directors.
REMUNERATION FOR THE YEAR (AUDITED)
During the financial year the Directors of the Company were paid short-term benefit payments in the form
of cash and two Directors were paid a pension as described below. There was no other form of
remuneration. A summary of the audited remuneration is below:
£ unless stated
12 months to
30 June 2023
12 months to
30 June 2022
Jason Upton*
97,154
76,321
Yiu Tak Cheung
15,000
15,000
Anthony Unsworth
115,794
19,172
Jeffrey Pym
-
19,172
David Izett
29,167
25,000
Jeremy Earnshaw
25,000
6,181
282,115
141,674
These payments are in line with the disclosures in the Financial Statements.
*During the year Jason Upton and Anthony Unsworth received remuneration in the form of a pension for
the amount of £1,321 and £1,211 respectively included in the total remuneration.
DIRECTORS’ INTERESTS IN SHARES
The beneficial interests of the Directors in the ordinary shares of the Company are set out below:
£ unless stated
12 months to
30 June 2022
Jason Upton
1,100,000
Yiu Tak Cheung*
25,200,000
David Izett
-
Jeremy Earnshaw
-
Anthony Unsworth
-
26,300,000
ONE HERITAGE GROUP PLC
35
*Yiu Tak (Peter) Cheung has an indirect interest in the Company through his 38.33 per cent. shareholding
in One Heritage Holding Group Limited, which owns 100 per cent of the Company’s parent company, One
Heritage Property Development Limited.
NON-EXECUTIVE DIRECTORS’ LETTERS OF APPOINTMENT
The following table provides details of the Non-Executive Directors’ letters of appointment:
£ unless stated
Date of appointment letter
David Izett
23 December 2020
Jeremy Earnshaw
18 March 2022
Each Non-Executive Director is appointed for an initial term of three years, subject to agreement,
satisfactory performance, and re-election by shareholders. The Non-executive Directors’ letters of
appointment provide for termination by either party by giving the other not less than three months’ notice
in writing.
POLICY REPORT
This section of the Directors’ remuneration report sets out the Group’s remuneration policy for Directors,
in line with industry best practice and the three-year Policy cycle the Company agreed at the AGM. The
AGM held on 19 November 2021 and will apply for three years from this date. The roll-out of the following
benefits is a priority and critical to retain and hire talent, and the process has begun with external
consultants to put an option scheme in place and performance criteria and the Rem Com hopes that this
will be concluded at the end of Q1 24.
The remuneration policy is designed to meet the following objectives:
- Promote the long-term success of the Company;
- Attract, motivate, and retain high-performing employees;
- Strike an appropriate balance between risk-taking and reward;
- Reward the achievement of the overall business objectives of the Group;
- Align employees’ interests with those of shareholders and other stakeholders; and,
- Be consistent with the Group’s risk policies and systems to guard against inappropriate risk-taking.
Element
Purpose and strategy
Operation
Maximum
Performance metrics
Base Salary
Sufficient to attract,
retain and motivate
high calibre
individuals.
Reviewed
annually with
any increases
taking effect
from 1
st
July.
Increases will
normally be the
equivalent to the
average salary
increase for
employees, other
than in
exceptional
circumstances.
Not applicable
Benefits
A package of benefits
that reflects the
businesses stage of
development
Car allowance
(1)
No other
benefits are
currently
advanced to
Management
that are not
Cost of each
benefit will be
reviewed to
ensure
maximum value.
It will depend on
the individual in
question and
Not applicable
ONE HERITAGE GROUP PLC
36
available to
other members
of staff
New benefits
may be
considered if the
Board believe it
is a cost-
effective way to
attract, retain
and motivate.
vary according to
the market.
Pension
To provide a pension
provision.
Individuals may
either participate
in a pension
plan into which
the Group
contributes or
receive a salary
supplement in
lieu of pension.
A Group
contribution to a
pension scheme
in line with that
which is
available to other
employees
Not applicable
Annual bonus
Incentivises high
levels of personal and
team performance,
focused on the key
business strategies
and
financial/operational
measures which will
promote the long-
term success of the
business.
Payment in
shares. Deferral
of one third of
any bonus
earned, which
must be held for
two years.
Dividends or
dividend
equivalent
payments
accrue on
deferred shares,
payable
normally in
shares.
Bonus may be
subject to
clawback or
malus being
applied, if
appropriate, in
the event of
financial
misstatement,
error,
misconduct,
reputational
damage or
corporate
failure, which
has led to an
over-payment.
Maximum bonus
is set depending
on the roles:
CEO – 100%
Development
Director – 100%
CFO – 50%
Achievement of
agreed strategic and
financial/operational
annual
business targets,
weighted in line with
business priorities. A
majority of the
performance
conditions will be
based on financial
metrics. Sliding
scales
are used for each
metric wherever
practicable with 20%
payable for achieving
threshold
performance.
Normally 50% of the
maximum bonus is
payable for target
performance for any
financial metric
Within the maximum
limit, the Committee
may adjust bonus
outcomes, based on
the application of the
bonus formula set at
the start of the
relevant year, if for
instance it considers
the quantum to be
inconsistent with the
Group’s overall
ONE HERITAGE GROUP PLC
37
performance during
the year.
Long term
incentive
plan “LTIP”
Incentivises and
rewards Executives
for the delivery of
longer-term strategic
objectives and to
reward substantial
relative and absolute
increases in
shareholder value.
LTIP awards
may be granted
each year in the
form of a
conditional
award of shares,
a nil
cost option. LTIP
awards normally
vest after three
years.
Dividend
equivalent
payments
accrue on vested
LTIP awards,
payable
normally in
shares. Vested
LTIP awards
must be held for
a further two
years before the
shares may be
sold
(other than to
pay tax).
LTIP awards
may be subject
to clawback or
malus being
applied, if
appropriate, in
the event of
financial
misstatement,
error,
misconduct,
reputational
damage, or
corporate
failure, which
has led to an
over-payment.
The maximum
award is 150% of
salary p.a. in
normal
circumstances
but may be 175%
of salary in
exceptional
circumstances.
Targets are reviewed
annually ahead of
each grant to ensure
they are aligned to
the business strategy
and performance
outlook.
A majority of the
performance
conditions are based
on Group financial
performance and
shareholder value-
based outcomes.
No more than 25% of
an award may vest
for the threshold level
of performance.
Within the maximum
limit, the Committee
may adjust vesting
outcomes, if it
considers the
quantum to be
inconsistent with the
Group’s overall
performance during
the performance
period or for other
factors, at its
discretion.
All-employee
share plans
Support and
encourage share
ownership by
employees
at all levels.
HMRC approved
SAYE and SIP
participation is
to be made
available to all
UK employees,
including
Executive
Directors, on
similar terms.
In line with
HMRC limits or
lower limits
specified by the
Group from time
to time.
Not applicable
ONE HERITAGE GROUP PLC
38
Share
ownership
requirements
Alignment of
Executives interests
with those of
shareholders.
Executive
Directors are
expected to
build and
maintain a
shareholding
equivalent in
value to no less
than 200% of
base
salary.
After ceasing
employment
Management
must normally
retain a level of
shareholding for
two years
equivalent to the
lower of 200% of
salary, and the
level of
shareholding on
ceasing
employment
with the Group.
Self-purchased
shares are
excluded from
this
requirement.
Not applicable
Not applicable
ONE HERITAGE GROUP PLC
39
DIRECTORS’ REPORT
Statement of Directors’ Responsibilities
DIRECTORS’ RESPONSIBILITIES
The Directors are responsible for preparing the Annual Report and the Group and parent Company financial
statements in accordance with applicable law and regulations.
Company law requires the Directors to prepare Group and parent Company financial statements for each
financial year. Under that law they are required to prepare the Group financial statements in accordance
with international accounting standards in conformity with the requirements of the Companies Act 2006
and applicable law and have elected to prepare the parent Company financial statements in accordance
with UK accounting standards and applicable law (UK Generally Accepted Accounting Practice), including
FRS 101 Reduced Disclosure Framework. In addition, the Group financial statements are required under
the UK Disclosure Guidance and Transparency Rules to be prepared in accordance with International
Financial Reporting Standards adopted pursuant to Regulation (EC) No 1606/2002 as it applies in the
European Union.
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 parent Company and of the Group’s
profit or loss for that period. In preparing each of the Group and parent Company financial statements, the
Directors are required to:
▪ select suitable accounting policies and then apply them consistently;
▪ make judgements and estimates that are reasonable, relevant, and reliable;
▪ for the Group financial statements, state whether they have been prepared in accordance with
international accounting standards in conformity with the requirements of the Companies Act 2006
and, as regards the Group financial statements, International Financial Reporting Standards
adopted pursuant to Regulation (EC) No 1606/2002 as it applies in the European Union;
▪ for the parent Company financial statements, state whether applicable UK accounting standards
have been followed, subject to any material departures disclosed and explained in the financial
statements;
▪ assess the Group and parent Company’s ability to continue as a going concern, disclosing, as
applicable, matters related to going concern; and
▪ use the going concern basis of accounting unless they either intend to liquidate the Group or the
parent Company or to cease operations, or have no realistic alternative but to do so.
The Directors are responsible for keeping adequate accounting records that are sufficient to show and
explain the parent Company’s transactions and disclose with reasonable accuracy at any time the financial
position of the parent Company and enable them to ensure that its financial statements comply with the
Companies Act 2006. They are responsible for such internal control as they determine is necessary to
enable the preparation of financial statements that are free from material misstatement, whether due to
fraud or error, and have general responsibility for taking such steps as are reasonably open to them to
safeguard the assets of the Group and to prevent and detect fraud and other irregularities.
Under applicable law and regulations, the Directors are also responsible for preparing a Strategic Report,
Directors’ Report, Directors’ Remuneration Report and Corporate Governance Statement that complies with
that law and those regulations.
The Directors are responsible for the maintenance and integrity of the corporate and financial information
included on the Company’s website. Legislation in the UK governing the preparation and dissemination of
financial statements may differ from legislation in other jurisdictions.
ONE HERITAGE GROUP PLC
40
WEBSITE PUBLICATION
The Directors are responsible for the maintenance and integrity of the corporate and financial information
included on the Company’s website. Legislation in the UK governing the preparation and dissemination of
financial statements may differ from legislation in other jurisdictions.
DIRECTORS’ RESPONSIBILITIES PURSUANT TO DTR4
The Directors confirm to the best of their knowledge:
▪ The financial statements have been prepared in accordance with the applicable set of accounting
standards and Article 4 of the IAS Regulation and give a true and fair view of the assets, liabilities,
financial position, and loss of the Company.
▪ The Annual Report includes a fair review of the development and performance of the business and the
financial position of the Company, together with a description of the principle risks and uncertainties
that it faces.
By order of the Board
Jason Upton
Chief Executive Officer
31 October 2023
Jason upton (Oct 31, 2023 21:04 GMT+8)
ONE HERITAGE GROUP PLC
41
FINANCIAL STATEMENTS
Independent Auditor’s Report to the Members of One Heritage
Group PLC
Our opinion
We have audited the consolidated financial statements and Company financial statements of One Heritage Group
Plc (the “Company”) and its subsidiaries (together, the “Group”), which comprise the consolidated statement of
financial position and the Company’s balance sheet as at 30 June 2023, the consolidated statements of
comprehensive income, the consolidated and Company’s changes in equity and consolidated cash flows for the
year then ended, and notes, comprising significant accounting policies and other explanatory information.
In our opinion:
1. the financial statements give a true and fair view of the state of the Group's and of the Company's affairs as at
30 June 2023 and of the Group's loss for the year then ended;
• the Group financial statements are properly prepared in accordance with UK-adopted international accounting
standards;
• the parent Company financial statements have been properly prepared in accordance with UK accounting
standards, including FRS 101 Reduced Disclosure Framework; and
• 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 are described below. We have fulfilled our ethical responsibilities under, and are
independent of the Company and Group in accordance with, UK ethical requirements including the FRC Ethical
Standard as applied to public interest entities. We believe that the audit evidence we have obtained is a sufficient
and appropriate basis for our opinion.
Key audit matters: our assessment of the risks of material
misstatement
Key audit matters are those matters that, in our professional judgment, were of most significance in the audit of
the consolidated financial statements and company financial statements and include the most significant assessed
risks of material misstatement (whether or not due to fraud) identified by us, 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 consolidated financial
statements and company financial statements as a whole, and in forming our opinion thereon, and we do not
provide a separate opinion on these matters. In arriving at our audit opinion above, the key audit matters were as
follows (unchanged from 2022):
The risk
Our response
Impairment of inventory –
developments
2023: £16,566,922 (2022
£15,127,758)
Refer to the Audit Committee
Report on page 32
, note 5
Estimation uncertainty:
The carrying value of inventory is
determined by reference to a number
of assumptions such as sales
values, costs to complete that are
inherent in site forecasts and the
level of provisioning, if any, required
Our audit procedures included:
Internal Controls:
Documenting and assessing the
design and implementation of the
ONE HERITAGE GROUP PLC
42
The risk
Our response
accounting policy and note 13
disclosures.
for impairment. These assumptions
are inherently subjective and
therefore may be open to
management bias.
The effect of these matters is that, as
part of our risk assessment, we
determined that the assumptions
used in the impairment assessment
have a high degree o
f estimation
uncertainty, with a potential range of
reasonable outcomes greater than
our materiality for the financial
statements as a whole, and possibly
many times that amount.
Risk:
There is a risk that the carrying value
of inventory is overstated. The
carrying value of inventory is
assessed by management for
impairment by reference to current
market information and
assumptions. In performing the
assessment, management
undertake quarterly valuations to
determine the expected outcome of
each developmen
t and hence
identify if any impairment is required.
processes and controls regarding
impairment of inventory;
Challenging managements’
assumptions and inputs:
We critically assessed the
appropriateness of key assumptions
and the commercial viability of sites as
determined by management through
comparison against historic data and
consideration of current market
conditions;
Assessing impairment model:
For incomplete development sites we
compared the actual costs incurred to
date to the budgeted costs to
complete where relevant and agreed
the budgeted costs to construction
contracts where they had been signed
or completion of works statements
from developers;
Forecast sales for each development
site were vouched to pre-sales and
bookings where available and, where
not available, to budgeted sales
listings (and assessed for
reasonableness based on market
prices for similar developments);
For each incomplete development we
recalculated the impairment charge
by deducting the estimated costs to
complete from the estimated selling
price and where complete we
compared actual costs incurred to
estimated selling prices;
Assessing disclosures:
Weconsidered the adequacy of the
group’s disclosures about the
economic and operational
ONE HERITAGE GROUP PLC
43
The risk
Our response
circumstances impacting the carrying
value of inventory property.
Our results
We found the results of our testing
and related disclosures in respect of
the impairment to be satisfactory and
the carrying value of inventory
recognised to be acceptable.
The risk
Our response
Going concern
Refer to the Audit Committee
Report on page 32 and notes 3 and
1 disclosures in the Group and
Company financial statements
respectively.
Disclosure quality:
The financial statements explain
how the Board has formed a
judgement that it is appropriate to
adopt the going concern basis of
preparation fo
r the Group and
parent Company.
That judgement is based on an
evaluation of the inherent risks to
the Group’s and Company’s
business model and how those risks
might affect the Group’s and
Company’s financial resources or
ability to continue operations over a
period of at least a year from the
date of approval of the financial
statements.
Risk:
The risks most likely to adversely
affect the Group’s and Company’s
available financial resources over
this period were:
• Continued support from the parent
compa
ny (in the nature of a
confirmation from the parent
company that their loan, due to
mature in December 2024, will not
be demanded for repayment until
Our audit procedures included:
Consideration of whether these
risks could plausibly affect the
liquidity of the Group and Company
in the going concern period by
assessing the directors’
sensitivities over the level of
available financial resources
indicated by the Group’s and
Company’s financial forecasts
taking acco
unt of severe, but
plausible, adverse effects that
could arise from these risks
individually and collectively.
Our procedures also included:
Funding assessment:
• Agreeing the committed level of
funding from the Company’s parent
company (One Heritage Property
Development Limited, Hong Kong)
to the facility agreement and
confirmed the balance drawn and
undrawn as at the year end;
• Inspecting the financial support
provided by the Company’s parent
company (confirming deferral of
repayment of the loan unti
l the
Group can afford to repay them
ONE HERITAGE GROUP PLC
44
The risk
Our response
such a time that the Group can
afford to repay them without
impacting on its going concern);
• The
refinancing of a previous
construction loan on improved terms
to match forecast completion dates
of the related developments; and
• The timely completion and sale of
property developments.
There are also less predictable but
realistic second order impacts, such
as the erosion of customer or
supplier confidence, which could
result in a rapid reduction of
available financial resources.
The risk for our audit was whether or
not those risks were such that they
amounted to a material uncertainty
that may have cast significant doubt
about the ability of the Group and
the Company to continue as a going
concern. Had they been such, then
that fact would have been required
to have been disclosed.
without impacting its going
concern);
• Assessing the ability of the
Company’s parent company to
meet the committed facility by
examining the latest unaudited
management accounts of the
ultimate parent company and a
letter of support which had been
provided by the ultimate parent
company to the Company’s parent
company;
• Assessing the appetite of the
parent company to meet any
further funding requests by
examining the history of requests
made and funding received in the
year and post year end;
• Agreeing post year-end receipts
from sale of units in completed
developments to bank statements
or repayment of the related
construction finance loans;
• Assessing whether the forecast
proceeds from the sale of
developments pro
jected to
complete in the forecast period to
31 December 2024 (net of
repayment of related construction
finance loans), supplemented by
continued financial support from
the Company’s parent company
and related company (as detailed
above) are sufficient to provide the
Group and Company with sufficient
liquidity to meet committed
expenditure in the forecast period
up to 31 December 2024;
Sensitivity analysis:
• Considering sensitivities over the
level of available financial
resources indicated by the Group’s
and Company’s financial forecasts
taking account of plausible (but not
unrealistic) adverse effects that
could arise from these risks
ONE HERITAGE GROUP PLC
45
The risk
Our response
individually and collectively. We did
this by stress testing the identified
critical factors, namely delaying the
timing
of the planned sales of
developments by 3 months;
Evaluating directors’ intent:
• Evaluating the achievability of the
actions the directors consider they
would take to improve the position
should the risks materialise, which
included delaying the planned
development of properties, taking
into account the extent to which the
directors can control the timing and
outcome of these;
Assessing transparency:
• Considering whether the going
concern disclosure in notes 3 and
1 to the group and company
fin
ancial statements respectively
give a full and accurate description
of the Directors’ assessment of
going concern, including the
identified risks and dependencies.
Our results
We found the going concern basis
of preparation without any material
uncertainty to be appropriate and
the related disclosure in notes 3
and 1 of the Group and Company
financial statements respectively
adequately describe the
judgements, assumptions and
dependencies..
The risk
Our response
ONE HERITAGE GROUP PLC
46
The risk
Our response
Recoverability of parent
Company’s loans to and
investment in subsidiaries
Loans to subsidiaries £3,033,711
(2022 £2,183,153) and investment
in subsidiaries £1,007,732 (2022
££2,750,100)
Refer to the Audit Committee
Report on page 32
, note 1
accounting policy and notes 2 and
3 di
sclosures in the Company
financial statements.
Low risk, high value:
The carrying value of the parent
Company’s loans to and
investment in subsidiaries
represents 99% of the parent
Company’s total assets. The
assessment of carrying value is not
at a high
risk of significant
misstatement or subject to
significant judgement as the
carrying value is supported by the
net asset value of the subsidiaries
and the profits forecast to be made
on sale of the development and
trading properties owned by the
subsidiar
ies (which are stated at
cost in the financial statements).
However, due to its materiality in
the context of the parent Company
financial statements, this is
considered to be the area that had
the greatest effect on our overall
parent Company audit.
Our audit procedures included:
Test of details:
Comparing the carrying amount of
100% of the parent Company’s
loans to and investments in
subsidiaries with the relevant
subsidiaries’ balance sheet and
budgets for the underlying
development and trading
properties to identify whether their
financial position supported the
carrying amount of the parent
Company’s loans to and
investments in those subsidiaries
and evaluating budgeted forecasts
in line with our knowledge of the
entity. This procedure was also
relevant for our assessment of
going concern.
Assessing disclosures
We have also considered the
adequacy of the Company’s
disclosure of the circumstances
identified by management in
respect of the carrying value of the
investments and intercompany
loan receivable from the subsidiary.
Our results:
The results of our testing were
satisfactory and we found the
carrying value and associated
disclosure of the investment in
subsidiary, following the provision
recognised by management, and
recoverability of parent Company’s
loans to be acceptable.
ONE HERITAGE GROUP PLC
47
Our application of materiality and an overview of the scope of our audit
Materiality for the consolidated financial statements as a whole was set at £147,000 (2022: £163,000), determined
with reference to a benchmark of group total assets of £19,251,448 (2022: £18,440,109), of which it represents
approximately 0.76% (2022: 0.88%).
Materiality for the Company financial statements was set at £40,000 (2022: £42,000), determined with reference
to a benchmark of Company total assets of £4,354,322 (2022: £5,067,679), of which it represents approximately
0.92% (2022: 0.83%).
In line with our audit methodology, our procedures on individual account balances and disclosures were performed
to a lower threshold, performance materiality, so as to reduce to an acceptable level the risk that individually
immaterial misstatements in individual account balances add up to a material amount across theconsolidated
financial statements as a whole. Performance materiality for Group was set at 65% (2022: 65%) of materiality for
the consolidated financial statements as a whole, which equates to £95,500 (2022: £106,000), which is lower than
the maximum of 75% per our methodology. This was to take into account the Group nature of the audit and resulting
increased level of aggregation risk from consolidation of the subsidiaries. For the Company, performance
materiality was set at 75% (2022: 75%), which equates to £30,000 (2022: £32,000). We applied this percentage in
our determination of performance materiality because we did not identify any factors indicating an elevated level of
risk.
We reported to the Audit Committee any corrected or uncorrected identified misstatements exceeding £7,350
(2022: £8,000), for the consolidated financial statements and £2,000 (2022: £2,000) for the Company financial
statements, in addition to other identified misstatements that warranted reporting on qualitative grounds.
Our audit of the Group was undertaken to the materiality level specified above, which has informed our identification
of significant risks of material misstatement and the associated audit procedures performed in those areas as
detailed above.
The group team performed the audit of the Group as if it was a single aggregated set of financial information. The
audit was performed using the materiality level set out above and covered 100% of total group revenue, total group
profit before tax, and total group assets and liabilities.
Going concern
The directors have prepared the consolidated financial statements and company financial statements on the going
concern basis as they do not intend to liquidate the Group or the Company or to cease their operations, and as
they have concluded that the Group and the Company's financial position means that this is realistic. They have
also concluded that there are no material uncertainties that could have cast significant doubt over their ability to
continue as a going concern for at least a year from the date of approval of the consolidated financial statements
and the company financial statements (the “going concern period").
An explanation of how we evaluated management’s assessment of going concern is set out in the related key audit
matter in the key audit matters section of this report.
Our conclusions based on this work:
1. we consider that the directors' use of the going concern basis of accounting in the preparation of the
consolidated financial statements and company financial statements is appropriate;
• we have not identified, and concur with the directors' assessment that there is not, a material uncertainty
related to events or conditions that, individually or collectively, may cast significant doubt on the the Group and
the Company's ability to continue as a going concern for the going concern period; and
• we have nothing material to add or draw attention to in relation to the directors' statement
in the notes to the
consolidated financial statements and company financial statements on the use of the going concern basis of
accounting with no material uncertainties that may cast significant doubt over the Group and the Company's
use of that basis for the going concern period, and that statement is materially consistent with the consolidated
financial statements and company financial statements and our audit knowledge. See the Key Audit Matter
with respect to going concern for additional detail.
However, as we cannot predict all future events or conditions and as subsequent events may result in outcomes
that are inconsistent with judgements that were reasonable at the time they were made, the above conclusions are
not a guarantee that the Group and the Company will continue in operation.
ONE HERITAGE GROUP PLC
48
Fraud and breaches of laws and regulations – ability to detect
Identifying and responding to risks of material misstatement due to fraud
To identify risks of material misstatement due to fraud (“fraud risks”) we assessed events or conditions that could
indicate an incentive or pressure to commit fraud or provide an opportunity to commit fraud. Our risk assessment
procedures included:
1. enquiring of management as to the Group’s policies and procedures to prevent and detect fraud as well as
enquiring whether management have knowledge of any actual, suspected or alleged fraud;
• reading minutes of meetings of those charged with governance; and
• using analytical procedures to identify any unusual or unexpected relationships.
As required by auditing standards, we perform procedures to address the risk of management override of controls,
in particular the risk that management may be in a position to make inappropriate accounting entries. On this audit
we do not believe there is a fraud risk related to revenue recognition because the Group’s revenue streams are
simple in nature with respect to accounting policy choice, and are easily verifiable to external data sources or
agreements with little or no requirement for estimation from management. We did not identify any additional fraud
risks.
We performed procedures including
1. Identifying journal entries and other adjustments to test based on risk criteria and comparing any identified
entries to supporting documentation; and
• incorporating an element of unpredictability in our audit procedures.
Identifying and responding to risks of material misstatement due to non-compliance with laws
and regulations
We identified areas of laws and regulations that could reasonably be expected to have a material effect on the
consolidated and Company financial statements from our sector experience and through discussion with
management (as required by auditing standards), and from inspection of the Group’s regulatory and legal
correspondence, if any, and discussed with management the policies and procedures regarding compliance with
laws and regulations. As the Group is regulated, our assessment of risks involved gaining an understanding of the
control environment including the entity’s procedures for complying with regulatory requirements.
The Group is subject to laws and regulations that directly affect the consolidated and Company financial statements
including financial reporting legislation and taxation legislation and we assessed the extent of compliance with
these laws and regulations as part of our procedures on the related financial statement items.
The Group is subject to other laws and regulations where the consequences of non-compliance could have a
material effect on amounts or disclosures in the consolidated and Company financial statements, for instance
through the imposition of fines or litigation or impacts on the Group and the Company’s ability to operate. We
identified financial services regulation as being the area most likely to have such an effect, recognising the
regulated nature of the Group’s activities and its legal form. Auditing standards limit the required audit procedures
to identify non-compliance with these laws and regulations to enquiry of management and inspection of regulatory
and legal correspondence, if any. Therefore if a breach of operational regulations is not disclosed to us or evident
from relevant correspondence, an audit will not detect that breach.
Context of the ability of the audit to detect fraud or breaches of law or regulation
Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some
material misstatements in the consolidated and company financial statements, even though we have properly
planned and performed our audit in accordance with auditing standards. For example, the further removed non-
compliance with laws and regulations is from the events and transactions reflected in the consolidated and
company financial statements, the less likely the inherently limited procedures required by auditing standards would
identify it.
ONE HERITAGE GROUP PLC
49
In addition, as with any audit, there remains a higher risk of non-detection of fraud, as this may involve collusion,
forgery, intentional omissions, misrepresentations, or the override of internal controls. Our audit procedures are
designed to detect material misstatement. We are not responsible for preventing non-compliance or fraud and
cannot be expected to detect non-compliance with all laws and regulations.
The directors' report and strategic report
The directors are responsible for the strategic report and the directors' report. Our opinion on the consolidated
financial statements and company financial statements do not cover those reports and we do not express an audit
opinion thereon.
Our responsibility is to read the strategic report and the directors' report and, in doing so, consider whether, based
on our consolidated financial statements and company financial statements audit work, the information therein is
materially misstated or inconsistent with the consolidated financial statements and company financial statements
or our audit knowledge. Based solely on that work:
1. we have not identified material misstatements in the strategic report and the directors' report;
• in our opinion the information given in those reports for the financial year is consistent with the consolidated
financial statements and company financial statements; and
• in our opinion those reports have been prepared in accordance with the Companies Act 2006.
Matters on which we are required to report by exception
Under the Companies Act 2006, we are required to report to you if, in our opinion:
1. adequate accounting records have not been kept, 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 these respects.
Respective responsibilities
Directors' responsibilities
As explained more fully in their statement set out on page 39, the directors are responsible for: the preparation of
the consolidated and Company financial statements including being satisfied that they give a true and fair view;
such internal control as they determine is necessary to enable the preparation of consolidated and Company
financial statements that are free from material misstatement, whether due to fraud or error; assessing the Group
and 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 they either intend to liquidate the Group or the Company
or to cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities
Our objectives are to obtain reasonable assurance about whether the consolidated financial statements and
company financial statements as a whole are free from material misstatement, whether due to fraud or error, and
to issue our opinion in an auditor’s report. Reasonable assurance is a high level of assurance, but does not
guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when
it exists. Misstatements can arise from fraud or error and are considered material if, individually or in aggregate,
they could reasonably be expected to influence the economic decisions of users taken on the basis of the
consolidated financial statements and company financial statements.
A fuller description of our responsibilities is provided on the FRC’s website at
www.frc.org.uk/auditorsresponsibilities.
ONE HERITAGE GROUP PLC
50
The purpose of our audit work and to whom we owe our responsibilities
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 its members,
as a body, for our audit work, for this report, or for the opinions we have formed.
Edward Houghton (Senior Statutory Auditor)
For and on behalf of KPMG Audit LLC (Statutory Auditor)
Chartered Accountants
Isle of Man
31 October 2023
ONE HERITAGE GROUP PLC
51
FINANCIAL STATEMENTS
Consolidated statement of comprehensive income
For the year ended 30 June 2023
£ unless stated
Notes
Year to
30 June 2023
Year to
30 June 2022
Revenue
7
15,591,928
1,747,221
Revenue – developments
15,591,928
1,097,221
Revenue – trading property
-
650,000
Cost of sales
(15,000,835)
(2,452,644)
Cost of sales - developments
(13,906,259)
(694,531)
Cost of sales – trading property
-
(460,553)
Cost of sales – write down of inventory
13
(1,094,576)
(1,297,560)
Gross profit/(loss)
591,093
(705,423)
Reversal in investment in associate
15
-
74,368
Other income
-
2,386
Administration expenses
8
(2,210,021)
(1,481,896)
Operating (loss) for the year
(1,618,928)
(2,110,565)
Gain on disposal of fixed asset
-
5,096
Finance expense
10
(520,851)
(29,466)
(Loss) before taxation for the year
(2,139,779)
(2,134,935)
Taxation
11
(250,473)
-
(Loss) after tax and comprehensive income for the
year
(2,390,252)
(2,134,935)
Weighted average shares in issue over the period
38,657,785
32,428,333
(Loss) per share (GBp)
(6.2)
(6.6)
Diluted (loss) per share (GBp)
(6.2)
(6.6)
The accompanying notes on pages 55 to 82 form an integral part of the financial statements.
ONE HERITAGE GROUP PLC
52
FINANCIAL STATEMENTS
Consolidated statement of financial position
As at 30 June 2023
£ unless stated
Notes
30 June 2023
30 June 2022
ASSETS
Non-current assets
Property, plant and equipment
12
278,628
374,475
Intangible assets
1,913
2,324
280,541
376,799
Current assets
Cash and cash equivalents
303,816
974,201
Inventory – developments
13
16,566,922
15,127,758
Investment in associate
15
-
50,000
Trade and other receivables
17
2,100,169
1,911,351
18,970,907
18,063,310
TOTAL ASSETS
19,251,448
18,440,109
LIABILITIES
Non-current liabilities
Borrowings
19
11,572,047
6,679,902
11,572,047
6,679,902
Current liabilities
Trade and other payables
20
2,579,644
1,944,632
Borrowings
19
5,668,473
9,241,139
8,248,117
11,185,771
TOTAL LIABILITIES
19,820,164
17,865,673
EQUITY
Share capital
23
386,783
324,283
Share premium
23
4,753,325
3,568,7 25
Retained earnings
(5,708,824)
(3,318,572)
TOTAL EQUITY
(568,716)
574,436
TOTAL LIABILITIES AND EQUITY
19,251,448
18,440,109
Shares in issue
38,678,333
32,428,333
Net asset value per share (GBp)
(1.5)
1.8
These financial statements were approved by the board of directors on 31 October 2023 and were signed
on its behalf by:
Jason David Upton
Company registration number: 12757649
The accompanying notes on pages 55 to 82 form an integral part of the financial statements.
Jason upton (Oct 31, 2023 21:04 GMT+8)
ONE HERITAGE GROUP PLC
53
FINANCIAL STATEMENTS
Consolidated statement of cash flows
For the year ended 30 June 2023
£ unless stated
Notes
Year to
30 June 2023
Year to
30 June 2022
Cash flows from operating activities
Loss for the year before tax
(2,139,779)
(2,134,935)
Adjustments for:
Reversal in equity accounted investee
15
-
(74,368)
Finance expense
10
520,851
29,466
Profit on disposal of associate
15
50,000
-
Profit on disposal of fixed assets
-
(5,096)
Depreciation of property, plant and equipment
8, 12
103,984
108,983
Amortisation of intangible asset
8
411
-
Movement in working capital:
Increase in trade and other receivables*
(188,818)
(845,796)
Decrease/(increase) in inventories*
700,068
(6,879,205)
Increase in trade and other payables*
384,539
1,319,649
Net cash used in operating activities
(568,744)
(8,481,302)
Cash flows from investing activities
Purchases of property, plant and equipment
12
(8,137)
(56,313)
Disposal of property, plant and equipment
12
-
18,333
Net cash used in investing activities
(8,137)
(37,980)
Financing cash flows
Issue of share capital
19
1,247,100
-
Interest paid
19
(2,647,476)
(1,044,771)
Proceeds from borrowings*
4,169,072
7,131,436
Proceeds of related party borrowing*
2,953,748
4,215,638
Borrowings repaid*
(5,729,326)
(948,743)
Payments made in relation to lease liabilities
12
(86,623)
(64,224)
Net cash (used in)/generated from financing
activities
(93,504)
9,289,336
Net change in cash and cash equivalents
(670,385)
770,054
Opening cash and cash equivalents
974,201
204,147
Closing cash and cash equivalents
303,816
974,201
*restated (note 1)
The accompanying notes on pages 55 to 82 form an integral part of the financial statements
ONE HERITAGE GROUP PLC
54
FINANCIAL STATEMENTS
Consolidated statement of changes in equity
For the year ended 30 June 2023
£ unless stated
Share
capital
Share
premium
Retained
earnings
Total
Equity
Balance at 01 July 2022
324,283
3,568,725
(3,318,572)
574,436
Loss for the period
-
-
(2,390,252)
(2,390,252)
Total comprehensive income for
the year
324,283
3,568,725
(5,708,824)
(1,815,816)
Issue of share capital
62,500
1,187,500
-
1,250,000
Cost of share issue
-
(2,900)
-
(2,900)
Balance at 30 June 2023
386,783
4,753,325
(5,708,824)
(568,716)
For the year ended 30 June 2022
£ unless stated
Share
capital
Share
premium
Retained
earnings
Total
Equity
Balance at 01 July 2021
324,283
3,568,725
(1,183,637)
2,709,371
Loss for the period
-
-
(2,134,935)
(2,134,935)
Total comprehensive income for
the year
324,283
3,568,725
(3,318,572)
574,436
Balance at 30 June 2022
324,283
3,568,725
(3,318,572)
574,436
The accompanying notes on pages 55 to 82 form an integral part of the financial statements.
ONE HERITAGE GROUP PLC
55
FINANCIAL STATEMENTS
Notes to the consolidated financial statements
For the year ended 30 June 2023
1. Reporting entity
One Heritage Group PLC (the “Company”)(Company number: 12757649) is a public limited company,
limited by shares, incorporated in England and Wales under the Companies Act 2006. The address of its
registered office and its principal place of trading is 80 Mosley Street, Manchester, M2 3FX. The principal
activity of the company and subsidiaries is that of property development.
These consolidated financial statements (“Financial Statements”) as at the end of the financial year to 30
June 2023 comprise of the Company and its subsidiaries. A full list of companies consolidated in these
Financial Statements can be found in Note 27.
2. Measuring convention
The financial statements are prepared on the historical cost basis except for financial assets at fair value
through profit or loss.
3. Basis of preparation
The Group’s financial statements have been prepared and approved by the Directors in accordance with
international accounting standards in accordance with UK-adopted international accounting standards
(“UK-adopted IFRS”). The Company has elected to prepare its parent company financial statements in
accordance with FRS 101. These are presented on pages 83 to 90. The significant accounting policies are
set out in note 5. The accounting policies have been applied consistently to all periods presented in these
group Financial Statements.
They were authorised for issue by the Company’s Board of Director on 31 October 2023.
Restatement
The prior year presentation of operating cashflows and financing cashflows have been reclassified in order
to reflect financing and operating cashflows appropriately. The impact of this restatement reduced
financing cash inflows by £546,772 from £9,836,108 to £9,289,336 (comprising an increase of £178,743 in
third party loans repaid and reduction of £368,029 in related party borrowing) and increased operating cash
flows by the same amount from £(9,028,074) to £(8,481,302) (comprising a reduced movement in
receivables and prepayments of £737,676, an increased movement in inventory of £435,768 and an
increased movement in payables of £244,864).
Segment reporting
During the previous financial year the Group has begun operating with distinct Segments, having
previously managed the Group as one distinct entity. This has been driven by the Group incorporating
entities to manage construction and property services, which were previously outsourced.
The Group operates in three operating segments, each managed by a senior manager who sits on the
Group’s management team. In addition to these, there is a corporate segment which covers central
operations. The following is a summary of the operations for each reportable segment.
Reportable segments
Operations
Developments
Internally managed development activities including the sales of completed
developments and Co-living property management fee
Construction
Construction services provided to an internally owned and managed
development
Property Services
Property letting and management services
Corporate
Head office, fees to related parties and other costs
ONE HERITAGE GROUP PLC
56
Management has determined the Group’s operating segments based on the information reviewed by
Senior Management to make strategic decisions. The chief operating decision maker is the Senior
Management Team, comprising the Executive Directors and the Department Directors. The information
presented to Senior Management Team includes reports from all functions of the business as well as
strategy, financial planning, succession planning, organisational development and Group-wide policies.
There are various levels of integration between Development and Construction. This integration involves
the services that Construction undertakes on the developments on behalf of the Development segment.
The Group’s primary measure of financial performance for segments is the operating profit or loss in the
period.
Going concern
Notwithstanding net current liabilities of £5.8 million (excluding inventory balances totalling £16.6 million)
as at 30 June 2023 (2022: £8.3 million (excluding inventory balances totalling £15.1 million), a loss for the
year then ended of £2.4 million (2022: £2.1 million) and operating cash outflows for the year of £0.6 million
(2022: £9 million), the financial statements have been prepared on a going concern basis which the directors
consider to be appropriate for the following reasons.
The directors have prepared a cash flow forecast on a consolidated basis for the period to 31 December
2024 which indicates that, taking account of reasonably possible downsides, the Group will have sufficient
funds to meet its liabilities including the Hampshire Trust Bank loan and Corporate Bond, as they fall due
for that period using the proceeds from:
• existing resources held by the Group (including funds drawn down on the parent company loan
facility post year-end)
• the forecast continued sale of development property inventory (net of repayment of related
construction finance loans (note 19)); and
• in the event of need, the continued financial support from its parent company One Heritage
Property Development Limited (“OHPD”) which includes the remaining facility of £5 million which
can be drawn down as required combined with the confirmation from OHPD that the loans due to
mature in December 2024 will not be demanded for repayment until such a time that the Group
can afford to repay them without impacting on its going concern.
As with any company placing reliance on other group/related entities for financial support, the directors
acknowledge that there can be no certainty that this support will continue although, at the date of approval
of these financial statements, they have no reason to believe that it will not do so.
Consequently, the directors are confident that the Company and its subsidiaries will have sufficient funds
to continue to meet their liabilities as they fall due for at least 12 months from the date of approval of the
financial statements and therefore have prepared the financial statements on a going concern basis.
4. Use of judgements and estimation uncertainty
The board has made judgements, estimates and assumptions that affect the application of the Group’s
accounting policies and the reported amounts in the financial statements. The directors continually evaluate
these judgements and estimates in relation to assets, liabilities, contingent liabilities, revenue and expenses
based upon historical experience and on other factors that they believe to be reasonable under the
circumstances. Actual results may differ from the judgements, estimates and assumptions.
The key areas of judgement and estimation are:
ONE HERITAGE GROUP PLC
57
o
The carrying value of inventory
: Under IAS 2: Inventories the Group must hold developments at the
lower of cost and net realisable value. The Group applies judgement to determine the net realisable
value of developments at a point in time that the property is partly developed and compares that to the
carrying value. The Group has undertaken an impairment review of all of the Inventory and determined
that an impairment is appropriate on three of the developments.
Measurement of fair values
A number of the Group’s accounting policies and disclosures require the measurement of fair values, for
both financial and non-financial assets and liabilities.
The Group has an established control framework with respect to the measurement of fair values. The Chief
Financial Officer has overall responsibilities for overseeing all significant fair value measurements.
The Chief Financial Officer regularly reviews significant unobservable inputs and valuation adjustments. If
third party information, such as broker prices or pricing services, is used to measure fair values, then the
Chief Financial Officer assesses the evidence obtained from the third parties to support the conclusion that
these valuations meet the requirements of the Standards, including the level in the fair value hierarchy in
which the valuations should be classified.
Significant valuation issues are reported to the Group’s audit committee.
When measuring the fair value of an asset or a liability, the Group uses observable market data as far as
possible. Fair values are categorised into different levels in fair value hierarchy based on the inputs used in
the valuation techniques as follows:
- Level 1: quotes prices (unadjusted) in active markets for identical assets and liabilities.
- Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability,
either directly (i.e. as prices) or indirectly (i.e. derived from prices).
- Level 3: inputs for the asset or liability that are not based on observable market data (unobservable
inputs)
If the inputs used to measure the fair value of an asset or liability fall into different levels of the fair value
hierarchy, then the fair value measurement is categorised in its entirely in the same level of the fair value
hierarchy as the lowest level input that is significant to the entire measurement.
The Group recognises transfer between levels of the fair value hierarchy at the end of the reporting period
during which the change has occurred.
The significant judgements with regard to going concern are the forecast timing of development property
inventory realisations and in the event it is needed the ability of the Group to be able to drawdown on the
facility by its parent company, One Heritage Property Development Limited (“OHPD”). Management of the
Company and its subsidiaries are not aware of any material uncertainties that may cast significant doubt
on the Company and its subsidiaries ability to continue as going concerns. Therefore, the Group financial
statements continue to be prepared on the going concern basis. For detail refer note 3 going concern.
5. Significant accounting policies
Basis of consolidation
Subsidiaries
Subsidiaries are entities controlled by the Group. The Group ‘controls’ any entity when it is exposed to, or
has rights to, variable returns from its involvement with the entity and has the ability to affect those returns
through its power over the entity. The financial statements of subsidiaries are included in the consolidated
financial statements from the date on which control commences until the date on which control ceases.
Transactions eliminated on consolidation
Intra-group balances and transactions, and any unrealised income and expenses (except for foreign
currency transaction gains or losses) arising from intra-group transactions, are eliminated. Unrealised gains
ONE HERITAGE GROUP PLC
58
arising from transactions with equity-accounted investees are eliminated against the investment to the
extent of the Group’s interest in the investee. Unrealised losses are eliminated in the same way as
unrealised gains, but only to the extent that there is no evidence of impairment.
Interests in equity-accounts investees
The Group’s interests in equity-accounted investees comprise interests in associates.
Associates are those entities in which the Group has significant influence, but not control or joint control,
over the financial and operating policies.
Interests in associates are accounted for using the equity method. They are initially recognised at cost,
which includes transaction costs. Subsequent to initial recognition, the consolidated financial statements
include the Group’s share of the profit or loss and OCI of equity-accounted investees, until the date on
which significant influence or joint control ceases.
Earnings per share and net asset value per share
Basic earnings per share amounts are calculated by dividing net profit or loss for the year attributable to
the owners of the Group by the weighted average number of ordinary shares outstanding during the year.
Diluted earnings per share amounts are calculated by dividing the net profit or loss attributable to the
owners of the Group (after adjusting for interest on the convertible notes) by the weighted average number
of ordinary shares outstanding during the year plus the weighted average number of ordinary shares that
would be issued on conversion of all the dilutive potential ordinary shares into ordinary shares.
Net asset value per share amounts is calculated by dividing net assets of the Group at the reporting date
by the weighted average number of ordinary shares outstanding during the year.
Revenue
Revenue is recognised when the performance obligation associated with the sale is completed or as the
performance obligation is completed over time where appropriate. The transaction price comprises the fair
value of the consideration received or receivable, net of value added tax, rebates and discounts and after
eliminating sales within the Group. Revenue and gross profit are recognised as follows (note 7):
a.
Developments
Revenue from housing sales is recognised in profit or loss when control is transferred to the customer.
This is deemed to be when title of the property passes to the customer on legal completion and the
performance obligation associated with the sale is completed.
b.
Property services and developments
Management fees are recognised as revenue in the period to which they relate when performance
obligations are fulfilled based on agreed transaction prices. Variable performance fees are estimated
based on the expected value and are only recognised over time as performance obligations are fulfilled
when progress can be measured reliably and to the extent that a significant reversal of revenue in a
subsequent period is unlikely.
c.
Construction
services
The Group primarily operates under cost plus margin agreements and therefore revenue is recognised
when the relevant cost has been incurred.
ONE HERITAGE GROUP PLC
59
d.
Corporate income
The Group generates a monthly co-living management fee for services provided relating to day-to-day
administration and office space. These fees are recognised as revenue in the period to which they relate
when performance obligations are fulfilled based on agreed transaction prices.
e.
Other income
The Group generates rental income from Trading Properties. This has been recognised as other
income rather than revenue as it is not expected to be a recurring source of income and is not a main
trading activity of the Group.
Cost of sales
The Group determines the value of inventory charged to cost of sales based on the total budgeted cost of
developing a site. Once the total expected costs of development are established, they are allocated to
individual plots to achieve a standard build cost per plot. Cost of sales represent cost for purchase of land,
construction costs, consultant costs, utilities cost and other related direct costs.
To the extent that additional costs or savings are identified as the site progresses, these are recognised
over the remaining plots unless they are specific to a particular plot, in which case they are recognised in
profit or loss at the point of sale.
Operating profit/(loss)
Operating profit/(loss) is the Group’s total earnings from its core business functions for a given period,
excluding the deduction of interest and taxes, the gain/(loss) on sale of subsidiaries and gain/(loss) on sale
of fixed assets.
Financial guarantees
A financial guarantee contract is initially recognised at fair value. At the end of each subsequent reporting
period, financial guarantees are measured at the higher of:
▪ The amount of the loss allowance, and
▪ The amount initially recognised less cumulative amortisation, where appropriate.
The amount of the loss allowance at each subsequent reporting period equals the 12-month expected credit
losses. However, where there has been a significant increase in the risk that the specified debtor will default
on the contract, the calculation is for lifetime expected credit losses.
Finance income
Interest income on bank deposits is recognised on an accruals basis. Also included in interest receivable
are interest and interest-related payments the Group receives on other receivables and external loans.
Finance costs
Borrowing costs are recognised on an accruals basis and are payable on the Group’s borrowings and lease
liabilities. Also included are the amortisation of fees associated with the arrangement of the financing.
Specific or general borrowing costs are capitalised if they are directly attributable to the acquisition,
construction or production of qualifying assets which are assets that necessarily take a substantial period
to get ready for sale. The group considers that its inventories are qualifying assets.
Foreign currencies
These consolidated financial statements are presented in Pound sterling, which is the Company’s functional
currency.
ONE HERITAGE GROUP PLC
60
The individual financial statements of each Group company are presented in Pound Sterling, the currency
of the primary economic environment in which it operates (its functional currency). Transactions in
currencies other than the functional currency are recorded at the rates of exchange prevailing on the dates
of the transactions. At each reporting date, monetary assets and liabilities that are denominated in foreign
currencies other than the functional currency are retranslated at the rates prevailing at the reporting date.
Leases
The Group as a lessee
The Group assesses at inception whether a contract is, or contains, a lease. A lease exists if the contract
conveys the right to control the use of an identified asset for a period of time in exchange for consideration.
The Group assessment includes whether:
▪ the contract involves the use of an identified asset;
▪ the Group has the right to obtain substantially all of the economic benefits from the use of the asset
throughout the contract period; and
▪ the Group has the right to direct the use of the asset.
At the commencement of a lease, the Group recognises a right-of-use asset along with a corresponding
lease liability.
The lease liability is initially measured at the present value of the remaining lease payments, discounted
using the Group’s incremental borrowing rate. The lease term comprises the non-cancellable period of the
contract, together with periods covered by an option to extend the lease where the Group is reasonably
certain to exercise that option based on operational needs and contractual terms. Subsequently, the lease
liability is measured at amortised cost by increasing the carrying amount to reflect interest on the lease
liability and reducing it by the lease payments made. The lease liability is remeasured when the Group
changes its assessment of whether it will exercise an extension or termination option.
Right-of-use assets are initially measured at cost, comprising the initial measurement of the lease liability
adjusted for any lease payments made at or before the commencement date, estimated asset retirement
obligations, lease incentives received and initial direct costs. Subsequently, right-of-use assets are
measured at cost, less any accumulated depreciation and any accumulated impairment losses, and are
adjusted for certain remeasurements of the lease liability. Depreciation is calculated on a straight-line basis
over the length of the lease.
Right-of-use assets are presented within non-current assets in property, plant and equipment, and lease
liabilities are included in current liabilities (borrowings) and non-current liabilities (borrowings) depending
on the length of the lease term.
Property, plant and equipment
Property, plant and equipment are stated at cost less accumulated depreciation, and accumulated
impairment losses.
Depreciation is recognised to write off the cost or valuation of assets less their residual values over their
useful lives, using the straight-line method. The estimated useful lives, residual values and depreciation
method are reviewed at each year end, with the effect of any changes in estimate accounted for on a
prospective basis.
The gain or loss on the disposal or retirement of an item of property, plant and equipment is determined
as the difference between the sales proceeds and the carrying amount of the asset as is recognised in the
profit or loss.
ONE HERITAGE GROUP PLC
61
Depreciation is provided at the following annual rates to write off each asset over its estimated useful life:
Fixtures and fittings 15% on cost
Office equipment 15% on cost
Motor vehicles 25% on cost
Impairment of tangible and intangible assets
At each reporting 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 to determine the extent of the
impairment loss (if any). Where the asset does not generate cash flows that are independent from other
assets, the Group estimates the recoverable amount of the cash-generating unit to which the asset belongs.
The 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 and the risks specific to the asset.
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 as an expense immediately in the profit or loss.
Where an impairment loss subsequently reverses, due to a change in circumstances or in the estimates
used to determine the asset’s recoverable amount, the carrying amount of the asset or cash-generating unit
is increased to the revised estimate of its recoverable amount, so long as it does not exceed the original
carrying value prior to the impairment being recognised. A reversal of an impairment loss is recognised as
income immediately in the statement of comprehensive income.
Financial instruments
Financial assets
Financial assets are initially recognised at fair value and subsequently classified into one of the following
measurement categories:
- Measured at amortised cost
- Measured subsequently at fair value through profit or loss (“FVTPL”)
- Measured subsequently at fair value through other comprehensive income (“FVOCI”)
The classification of financial assets depends on the Group’s business model for managing the asset and
the contractual terms of the cash flows. Assets that are held for the collection of contractual cash flows that
represent solely payments of principal and interest are measured at amortised cost, with any interest
income recognised in profit or loss using the effective interest method.
Financial assets that do not meet the criteria to be measured at amortised cost are classified by the Group
as measured at FVTPL. Fair value gains and losses on financial assets measured at FVTPL are recognised
in profit or loss and presented within net operating expenses.
The Group currently has no financial assets measured at FVOCI.
Impairment of financial assets
The Group assesses on a forward-looking basis the expected credit loss associated with its financial assets
carried at amortised cost. The impairment methodology applied depends on whether there has been a
significant increase in credit risk. For trade receivables, the Group applies the simplified approach permitted
by IFRS 9, which requires expected lifetime losses to be recognised from initial recognition of the
receivables.
ONE HERITAGE GROUP PLC
62
Trade and other receivables
Trade and other receivables are measured at amortised cost, less any loss allowance.
Cash and cash equivalents
Cash and cash equivalents comprise cash held by the Group and short-term bank deposits with an original
maturity of three months or less from inception and are subject to insignificant risk of changes in value.
Financial liabilities
Financial liabilities are initially recognised at fair value and subsequently classified into one of the following
measurement categories:
- Measured at amortised cost
- Measured subsequently at fair value through profit or loss
Non-derivative financial liabilities are measured at FVTPL when they are considered held for trading or
designated as such on initial recognition.
The Group has no non-derivative financial liabilities measured at FVTPL.
Derecognition
Financial assets
The Group derecognises a financial asset when:
▪ the contractual rights to the cash flows from the financial asset expire; or
▪ it transfers the rights to receive the contractual cash flows in a transaction in which either:
▪ substantially all of the risks and rewards of ownership of the financial asset are transferred; or
▪ the Group neither transfers nor retains substantially all of the risks and rewards of ownership and
it does not retain control of the financial asset.
Financial liabilities
The Group derecognises a financial liability when its contractual obligations are discharged or cancelled,
or expire. The Group also derecognises a financial liability when its terms are modified and the cash flows
of the modified liability are substantially different, in which case a new financial liability based on the
modified terms is recognised at fair value.
On derecognition of a financial liability, the difference between the carrying amount extinguished and the
consideration paid (including any non-cash assets transferred or liabilities assumed) is recognised in profit
or loss.
Borrowings
Borrowings are allocated to either specific or general borrowings and initially recognised at fair value, net
of transaction costs incurred and subsequently measured at amortised cost. Specific or general borrowing
costs are capitalised if they are directly attributable to the acquisition, construction or production of
qualifying assets which are assets that necessarily take a substantial period of time to get ready for sale.
These are added to the cost of those assets, until such time as the assets are substantially ready for their
intended use or sale.
All other borrowing costs are recognised in profit or loss in the period in which they are incurred.
Trade and other payables
Trade and other payables are measured at amortised cost. When the acquisition of land has deferred
payment terms a land creditor is recognised. Payables are discounted to present value when repayment is
due more than one year after initial recognition or the impact is material.
ONE HERITAGE GROUP PLC
63
Customer deposits
Customer deposits are recorded as deferred income on receipt and released to profit or loss when the
related revenue is recognised.
Equity instruments
An equity instrument is any contract that evidences a residual interest in the assets of the Group after
deducting all of its liabilities. Equity instruments issued by the Company are recorded as the proceeds are
received, net of direct issue costs.
Amortisation
Amortisation is charged to the income statement on a straight-line basis over the estimated useful lives of
intangible assets unless such lives are indefinite. Intangible assets with an indefinite useful life and goodwill
are systematically tested for impairment at each balance sheet date.
Inventory - developments
Inventories are initially stated at cost and held at the lower of this initial amount and net realisable value.
Costs comprise direct materials and, where applicable, direct labour and those overheads that have been
incurred in bringing the inventories to their present location and condition.
Net realisable value represents the estimated selling price based on intended use less all estimated costs
of completion and costs to be incurred in marketing, selling and distribution. Land is recognised in
inventory when the significant risks and rewards of ownership have been transferred to the Group.
Non-refundable land option payments are initially recognised in inventory. They are reviewed regularly and
written off to profit or loss when it is probable that the option will not be exercised.
Taxation
The tax charge represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the period. Taxable profit differs from profit before
tax as reported in the profit or loss because it excludes items of income or expense that are taxable or
deductible in other years, and it further excludes items that are never taxable or deductible. The Group’s
liability for current tax is calculated using tax rates that have been enacted or substantively enacted at the
reporting date.
Deferred tax
Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts
of assets and liabilities in the financial statements and the corresponding tax bases used in the computation
of taxable profit. Deferred tax liabilities are generally recognised for all taxable temporary differences and
deferred tax assets are recognised to the extent that it is probable that taxable profits will be available
against which deductible temporary differences can be utilised.
Such assets and liabilities are not recognised if the temporary difference arises from goodwill or from the
initial recognition (other than in a business combination) of other assets and liabilities in a transaction that
affects neither the taxable profit nor the accounting profit.
Deferred tax liabilities are also recognised for taxable temporary differences arising on investments in
subsidiaries and interests in joint ventures, except where the Group is able to control the reversal of the
temporary difference and it is probable that the temporary difference will not reverse in the foreseeable
future.
Deferred tax is measured on a non-discounted basis using the tax rates and laws that have been enacted
or substantively enacted by the reporting date.
ONE HERITAGE GROUP PLC
64
The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent
that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset
to be recovered. Deferred tax is charged or credited to the profit or loss, except when it relates to items
charged or credited directly to other comprehensive income or equity, in which case the deferred tax is also
dealt with in other comprehensive income or equity.
Share capital
Ordinary shares are classified as equity. Any incremental costs directly attributable to the issue of new
shares are shown in equity as a deduction, net of tax, from the proceeds.
6. Operating segments
The Group operates four segments: Developments, Construction, Property Services and Corporate.
The accounting policies of the reportable segments are the same as the Group’s accounting policies
described in Note 5.
All the revenues generated by the group were generated within the United Kingdom.
In the developments segment, £9,766,522 revenue was generated from external parties through the sale of
71 units in completed developments (2022: £nil). In the Lincoln House development, 52 units were sold
during the year generating revenue of £6,496,522. The Bank Street development sold 19 units generating
£3,270,000 in revenue. The remainder of the revenue was earned from related parties in the form of rental
income and development management fees.
The revenue generated from Robin Hood Property Development Limited, a related party, amounted to
£1,280,006 (30 June 2022: £590,952) for the year. This amounted to 8% (30 June 2022: 34%) of the total
revenue of the Group. This was derived from three segments of the Group, see note 7.
Segment information for these businesses is presented below. Segment operating profit or loss is used as
a measure of performance as management believe this is the most relevant information when evaluating
the performance of a segment.
For the financial year to 30 June 2023
£ unless stated
Developments
Construction
Property
services and
Lettings
Corporate
Total
Revenue – developments
10,689,920
4,448,376
333,299
120,333
15,591,928
Cost of sales -
developments
(9,580,942)
(4,235,479)
(89,839)
-
(13,906,259)
Impairment of inventory
(1,094,576)
-
-
-
(1,094,576)
Gross profit/(loss)
14,402
212,897
243,460
120,333
591,093
Depreciation
-
-
-
(103,984)
(103,984)
Administration expenses
(532,900)
-
(411,682)
(1,161,455)
(2,106,037)
Operating (loss)/profit
(518,498)
212,897
(168,222)
(1,145,105)
(1,618,928)
Finance expense
(455,331)
-
-
(65,520)
(520,851)
Taxation
(250,473)
(250,473)
(Loss)/Profit for the year
(973,829)
212,897
(168,222)
(1,461,098)
(2,390,252)
ONE HERITAGE GROUP PLC
65
For the financial year to 30 June 2022
£ unless stated
Developments
Construction
Property
services and
Lettings
Corporate
Total
Revenue – developments
227,334
665,224
158,449
46,214
1,097,221
Revenue – trading property
650,000
-
-
-
650,000
Cost of sales -
developments
-
(618,496)
(76,035)
-
(694,531)
Cost of sales – trading
property
(460,553)
-
-
-
(460,553)
Impairment of inventory
(1,297,560)
-
-
-
(1,297,560)
Gross profit/(loss)
(880,779)
46,728
82,414
46,214
(705,423)
Reversal in investment in
associate
-
-
-
74,368
74,368
Other income
-
-
-
2,386
2,386
Administration expenses
(320,868)
(64,000)
(210,250)
(773,232)
(1,368,350)
Other expenses
-
-
-
(113,546)
(113,546)
Operating loss
(1,201,647)
(17,272)
(127,836)
(763,810)
(2,110,565)
Gain on disposal of fixed
asset
-
-
-
5,096
5,096
Finance expense
-
-
-
(29,466)
(29,466)
(Loss) for the year
(1,201,647)
(17,272)
(127,836)
(788,180)
(2,134,935)
7. Revenue
£ unless stated
30 June 2023
30 June 2022
Revenue
Trading property
-
650,000
Developments
10,689,920
227,334
Development sales
9,991,574
-
Development management
698,346
227,334
Construction
4,448,376
665,224
Property Services and Lettings
333,299
158,449
Transaction services
81,500
50,163
Lettings services
251,799
108,286
Corporate
120,333
46,214
15,591,928
1,747,221
ONE HERITAGE GROUP PLC
66
Cost of sales
Trading property
-
(460,553)
Developments
(10,675,518)
(1,297,560)
Development sales
(9,580,942)
-
Impairment (note 13)
(1,094,576)
(1,297,560)
Construction
(4,235,478)
(618,496)
Lettings services
(89,839)
(76,035)
(15,000,835)
(2,452,644)
Gross loss
591,093
(705,423)
Developments consist of sales of properties owned and developed by the Group and four development
management agreements with One Heritage Tower Limited, ACT Property Holding Limited, One Heritage
Great Ducie Street Limited and One Heritage North Church Limited:
- One Heritage Tower Limited: The Group earns a management fee of 0.75% £134,599 (30 June 2022:
£123,150) of costs incurred to date per month and a 10% share of net profit generated by the
development through the agreement with One Heritage Tower Limited. The Group is also entitled
to 1% of any external debt or equity funding raised on behalf of the development.
- ACT Property Holding Limited: The agreement has a 20% profit share of the net profit generated
by the development. The development generated £58,783 of profit share for the Group.
- One Heritage Great Ducie Street Limited: The Group earned a management fee of £206,160 (30
June 2022: £nil) through the agreement with One Heritage Great Ducie Street and £225,500 for
external debt raised.
- The One Heritage North Church Limited agreement splits the fees into three: 1. 2% of total
development cost (£41,654 30 June 2022: £104,184), paid monthly over the period of the
development; 15% of net profit, paid on completion; 1% on any debt finance raised (£31,650).
With the exception of ACT Property Holding Limited which completed in the year, the Group has not
recognised any further revenue linked to the profit share element of these agreement as the transaction
price is variable and the amount cannot be reliably determined at this time. This is because the
developments are in the early stages of construction and there is too much uncertainty to reliably estimate
expected revenue.
During the year £9,766,522 revenue was generated from external parties through the sale of 71 units in
completed developments (2022: £nil). In the Lincoln House development, 52 units were sold during the year
generating revenue of £6,496,522. The Bank Street development sold 19 units generating £3,270,000 in
revenue.
Construction generates revenue from two entities: Robin Hood Property Development Limited and One
Heritage North Church Limited. During the previous financial year, it signed an agreement with Robin Hood
Property Development Limited to undertake works on Co-living properties. The Group receives a cost plus
5.0% margin on all works undertaken, recognising £1,280,006 (30 June 2022: £534,619) of revenue in the
year. The Group has undertaken work for One Heritage North Church Limited on a cost plus 5.0% margin
basis, this generated revenue of £3,168,370 (30 June 2022: £130,605) in the year.
The development and construction revenues have been generated through related parties.
Property Services generated revenue from management fees that are based on a percentage of gross rental
collected for clients and through transaction fees for each co-living property bought and sold for Robin
Hood Property Development Limited, a related party £115,818 (30 June 2022: £55,057).
It also includes any rental income collected for properties owned by the Group.
ONE HERITAGE GROUP PLC
67
The Corporate revenue is from contracts signed with Robin Hood Property Development Limited,
generating revenue of £108,333 and One Heritage Portfolio Rental Limited, recognising revenue of £12,000
and is in consideration for a range of administration services and use of the Group’s office.
Revenue is measured based on the consideration specified in a contract with a customer. The Group
recognises revenue when it transfers control over a good or service to a customer.
The following table provides information about the nature and timing of the satisfaction of performance
obligations in contracts with customers, including significant payment terms, and related revenue
recognition policies.
Type of product/service
Nature and timing of satisfaction of performance
obligations, including significant payment terms
Revenue recognition
policies
Development
management
Housing sales
Revenue from housing sales is recognised in
profit or loss when control is transferred to the
customer.
Development management recognition is split
into three elements; management fee,
arrangement fees and a profit share on a final
transaction.
Management fee
The performance obligation is that the Group
remains the development manager on the site
and undertakes the scope of works in the
agreement. Payment is due on a monthly basis
after the service has been undertaken.
Arrangement fee
The performance obligation is at the point that
the service is completed. Payment is due after
completion.
Profit share
Assuming that the Group has performed the
scope of works effectively (its performance
obligation), it is entitled to a share of the profits
at the end of the project. The payment for this is
made at the end of the project.
No warranties are provided.
Revenue from housing
sales is recognised
when title of the
property passes to the
customer on legal
completion and the
performance obligation
associated with the sale
is completed.
Revenue for the
management fee is
recognised monthly as
long as the group
continues to be the
development manager
during the relevant
calculation period.
Assuming that the
Group continues to be
the development
manager the group will
look to recognise
income from a profit
share once the costs
and proceeds of a
particular site can be
reliably estimated and
unlikely to be reversed.
Construction revenue
The Group operates contracts where it charges
based on a cost incurred plus margin basis.
Revenue is recognised at the point that the cost
is incurred.
Payment is generally made within 30 days of the
invoice being raised.
Revenue is recognised
when the associated
cost is incurred.
Property Services –
Management fees and
other services
The Group offers property management services
to external landlords. These services are linked
to a percentage of the gross rental collected and
any additional services undertaken.
Management fee income is recognised at the
point that the service is provided.
Other income is recognised at the point that the
service is completed.
Revenue is recognised
when service is
provided for
management fees and
at the point the service
is completed for other
services.
ONE HERITAGE GROUP PLC
68
Payments for these services are made within 90
days of the service being undertaken.
Corporate revenue
The Group provides services, which include
administration, reporting, risk management,
shared office space and other services, to related
parties. Revenue is recognised for the period in
which the service is undertaken.
Revenue is recognised
monthly as long as the
Group continues to
provide the service
during the relevant
calculation period.
8. Administration expenses
£ unless stated
Year to
30 June 2023
Year to
30 June 2022
Staff costs
1,306,577
908,946
Depreciation and amortisation
104,217
108,983
Auditors’ remuneration
103,431
81,106
Other administration expenses
695,796
382,861
2,210,021
1,481,896
£ unless stated
Year to
30 June 2023
Year to
30 June 2022
Services provided by the auditor
- Interim audit of parent company and consolidated financial
statements
29,011
20,441
- Audit of parent company and consolidated financial statements
74,420
60,665
103,431
81,106
9. Staff costs and employees
£ unless stated
Year to
30 June 2023
Year to
30 June 2022
The aggregate remuneration comprised:
- Wages and salaries
1,159,761
816,982
- National insurance
129,537
78,414
- Pension costs
17,278
13,550
Average number of employees
28
23
10. Finance costs
£ unless stated
Year to
30 June 2023
Year to
30 June 2022
Interest charged on lease liabilities
12,607
15,263
Interest paid on borrowings
2,647,476
1,036,278
Amount capitalised*
(2,139,232)
(1,022,075)
520,851
29,466
*The rate of interest used to capitalise the general borrowings is 7%.
ONE HERITAGE GROUP PLC
69
11. Income tax expense
The Group has generated a loss in the year and the prior year.
Tax losses carried forward
Tax losses for which no deferred tax asset was recognised expire as follows:
£ unless stated
Year to
30 June 2023
Year to
30 June 2022
Tax (losses)
(2,390,252)
(2,134,935)
Accumulated carried forward losses
5,412,010
3,021,758
The carried forward losses do not expire as they relate to trading activity that is expected to continue.
£ unless stated
Year to
30 June 2023
Year to
30 June 2022
Income tax expense recognised in the period
(250,473)
-
Reconciliation of effective tax rate
£ unless stated
Year to
30 June 2023
Year to
30 June 2022
Loss for the year/period
(2,139,779)
(2,134,935)
Tax using the blended UK corporate tax rate of
20.5% (£2022: 19%)
(438,655)
(405,633)
Gross non-deductible expenses
555,748
-
Current year losses for which no deferred tax
asset was recognised
133,380
419,763
Non-taxable income
-
(14,130)
Total taxation expense
250,473
-
ONE HERITAGE GROUP PLC
70
12. Property, plant and equipment
As at 30 June 2023
£ unless stated
Right
of use
Office
Equipment
Fixtures and
fittings
Motor
vehicles
Plant and
equipment
Total
Cost
At 30 June 2022
442,612
23,182
72,664
-
1,149
539,607
Additions
-
6,280
930
-
927
8,137
At 30 June 2023
442,612
29,462
73,594
-
2,076
547,744
Accumulated depreciation
At 30 June 2022
147,612
5,019
12,472
-
29
165,132
Charge for the period
88,522
4,381
10,666
-
415
103,984
At 30 June 2023
236,134
9,400
23,138
-
444
269,116
Carrying amount
At 30 June 2022
295,000
18,163
60,192
-
1,120
374,475
At 30 June 2023
206,478
20,062
50,456
-
1,633
278,628
As at 30 June 2022
£ unless stated
Right
of use
Office
Equipment
Fixtures and
fittings
Motor
vehicles
Plant and
equipment
Total
Cost
At 30 June 2021
442,612
14,073
28,933
34,634
-
520,252
Additions
-
9,109
43,731
-
1,149
53,989
Disposals
-
-
-
(34,634)
(34,634)
At 30 June 2022
442,612
23,182
72,664
-
1,149
539,607
Accumulated
depreciation
At 30 June 2021
59,090
1,678
2,543
14,235
-
77,546
Charge for the period
88,522
3,341
9,929
7,162
29
108,983
Disposal
-
-
-
(21,397)
-
(21,397)
At 30 June 2022
147,612
5,019
12,472
-
29
165,132
Carrying amount
At 30 June 2021
383,522
12,395
26,390
20,399
-
442,706
At 30 June 2022
295,000
18,163
60,192
-
1,120
374,475
Right of use asset
£ unless stated
30 June 2023
30 June 2022
Amount recognised in the statement of financial
position:
Right of use
Buildings
206,478
295,000
206,478
295,000
Lease liability
Non-current
193,109
267,125
ONE HERITAGE GROUP PLC
71
Current
86,623
86,623
279,732
353,748
£ unless stated
Year to
30 June 2023
Year to
30 June 2022
Amount recognised in the profit and loss:
Depreciation on right of use building
88,522
88,522
Interest expense
12,607
15,263
Amount recognised in the statement of cash flow:
Lease payments made
86,623
64,224
Break options
The lease for the office has an option to break the lease after 5 years. The right-of-use asset has been
calculated on the assumption that the break clause is taken up.
13. Inventory - developments
£ unless stated
30 June 2023
30 June 2022
Residential developments
- Land
4,895,358
4,394,799
- Construction and development costs
9,547,628
9,322,221
- Capitalised interest
2,123,936
1,410,738
16,566,922
15,127,758
On 12 July 2022 the Group completed the acquisition of development land on Victoria Road, Eccleshill for
£1,000,000, and on 19 December 2022, the Group purchased Churchgate for the value of £120,000.
As at 30 June 2022, the Group had taken the decision to impair the value of its Bank Street and St Petersgate
development, which are owned by wholly owned subsidiaries, One Heritage Bank Street Limited and One
Heritage St Petersgate Limited. This was a consequence of significant cost pressures and issues with the
previous contractors. The impairment totalled £1,297,560 as at 30 June 2022.
Due to further expenditures, the Group has taken the decision to further impair the value of its Bank Street
and St Petersgate developments and additionally, the Oscar House development. The impairment totalled
£2,392,136 as at 30 June 2023 and the charge for the year was £1,094,576.
14. Inventory - trading properties
£ unless stated
30 June 2023
30 June 2022
Opening
-
435,820
Disposals
-
(444,331)
Additions
-
8,511
Closing
-
-
The Group disposed of Nicholas Street Development Limited during the prior financial year. This entity held
the Nicholas Street property. This property was valued at £650,000 by Management, with the net proceeds
received adjusted to reflect the other assets and liabilities in Nicholas Street Development Limited at the
ONE HERITAGE GROUP PLC
72
date of disposal. Nicholas Street Development Limited was sold to One Heritage Property Rental Limited,
a related party.
15. Investment in associate
On 17 March 2019, the Group invested £258,512 to acquire a 47.0% stake in One Heritage Complete Limited.
One Heritage Complete provides letting and facilities and property management for investors in Co-living
properties. On 05 October 2021 two subsidiaries of One Heritage Complete Limited, namely One Heritage
Maintenance Limited and One Heritage Design Limited were put into liquidation and the investment in
associate was written down to nil in the 30 June 2022 annual financial statements.
Reconciliation of investment in associate
£ unless stated
30 June 2023
30 June 2022
Opening
50,000
-
Reversal of write down of investment in associate
-
50,000
Sale of investment in associate
(50,000)
-
Closing
-
50,000
Following the insolvency of two subsidiaries of our associate, One Heritage Complete Limited, the Group
made the decision to write down the full value of our investment in associate. On 6 July 2022, the Group
agreed to sell our 47.0% stake in One Heritage Complete Limited for £50,000. Furthermore the Group has
decided that the £24,368 provision against prior dividends were no longer required and was reversed in the
prior financial year.
16. Financial assets at FVTPL
£ unless stated
30 June 2023
30 June 2022
Opening
-
397,796
Drawdown
-
-
Repayment
-
(423,959)
Profit recognised in the period
-
26,163
-
-
During the prior year, the profit participation loan with Robin Hood Property Development Limited was
cancelled and the outstanding funds due were repaid.
17. Trade and other receivables
£ unless stated
30 June 2023
30 June 2022
Trade receivables
339,097
776,570
Other debtors
1,132,525
140,544
Prepaid sales fees and commissions
568,688
843,835
VAT receivable
51,636
109,811
Related party receivable
8,223
40,591
2,100,169
1,911,351
Trade receivables includes £14,192 (30 June 2022: £50,980) due from One Heritage Tower Limited, £209,168
(30 June 2022: £154,089) due from One Heritage North Church Limited, £nil (30 June 2022: £3,221) due from
One Heritage Great Ducie Street Limited, £30,061 (30 June 2022: £565,880) due from Robin Hood Property
Development Limited and £1,200 (30 June 2022: £2,400) due from One Heritage Property Rental Limited,
whom are all related parties.
These financial assets are considered due from related parties, further details can be found in note 24.
ONE HERITAGE GROUP PLC
73
The prepaid sales fees and commissions relate to the sales agents fees and commissions paid on units
from developments that have been exchanged but not yet completed. These relate to units exchanged on
the Lincoln House, St Petersgate, Bank Street and Oscar House developments.
Management consider that the credit quality of the various receivables is good in respect of the amounts
outstanding, there have been no increases in credit risk and therefore credit risk is considered to be low.
Therefore, no expected credit loss provision has been recognised.
18. Capital management
The Group defines capital as the Group’s shareholder equity and borrowings. The Group’s policy is to
maintain a strong capital base so as to maintain, investor, creditor and market confidence and to sustain
future development of the business. Management monitors the return on capital, as well as the level of
external debt in the business.
The Group monitors capital using a ratio of ‘net debt’ to shareholder equity. Net debt is calculated as total
liabilities (as shown in the statement of financial position) less cash and cash equivalents. The Group’s
policy is to keep the ratio below 3.0. In the current and prior year the ratio is significantly higher than the
policy due to the negative equity and the impairment of three developments.
£ unless stated
30 June 2023
30 June 2022
Total borrowings
17,240,521
15,921,041
Less: cash and cash equivalents
(303,816)
(974,201)
Net debt
16,936,705
14,946,840
Total equity
(568,716)
574,436
Net debt to equity ratio
N/A
26.0
19. Loans and borrowings
£ unless stated
30 June 2023
30 June 2022
Non-current
Lease liability
(note 12)
193,109
267,125
Related party borrowings
11,378,938
5,000,000
Loan
-
1,412,777
11,572,047
6,679,902
Current
Lease liability
(note 12)
86,623
86,623
Related party borrowings
-
3,425,190
Loan
5,581,850
5,729,326
5,668,473
9,241,139
17,240,521
15,921,041
On 16 December 2021 a subsidiary, One Heritage Lincoln House Limited, signed a loan agreement with
Shawbrook Bank Limited. This was for a gross amount of construction finance totalling £3.5 million. This
had a term of 20 months and is to be drawn down to fund costs incurred by the development in that
subsidiary. In line with the agreement on the loan, when the Lincoln House development reached practical
completion in August 2022, as units are sold, the proceeds of these will go toward repayment of the loan.
The Group paid an arrangement fee of £35,000 and will pay an exit fee of £43,875 on final repayment. The
loan was repaid in full on 27 January 2022. The loan had two covenants that are linked to the underlying
ONE HERITAGE GROUP PLC
74
development, the loan to development cost of 44% and a loan to value of 45%, which have both been
complied with during the reporting period.
On 20 May 2021 a subsidiary, One Heritage Oscar House Limited, signed a loan agreement with Lyell
Trading Limited. This was for a gross amount of construction finance totalling £4 million. This had a term
of 18 months and is to be drawn down to fund costs incurred by the development in that subsidiary. On 18
November 2022 the Group entered into an agreement to extend the loan to 19 May 2023. The loan bears
interest at 9.6% per year. The loan had two covenants that are linked to the underlying development, the
loan to development cost of 69% and a loan to value of 89%, which have both been complied with during
the reporting period.
As the One Heritage Oscar House Limited development incurred further delays and indicated a completion
date post May 2023, the Group refinanced the project settling the previous debt of £3.9m on 09 June 2023.
An agreement has been entered into with a new lender, Hampshire Trust Bank Limited, on improved terms
for £4.2m for a period of 10 months to provide appropriate funding until all the remaining units are legally
completed and handed over to customers. The new loan has a single covenant that are linked to the
underlying development, the loan to gross development value of 57% which have been complied with
during the reporting period.
On 01 June 2021 a subsidiary, One Heritage Bank Street Limited, signed a loan agreement with Together
Commercial Finance Limited. This was for a gross amount of construction finance totalling £2 million. This
had a term of 18 months and is to be drawn down to fund costs incurred by the development in that
subsidiary. During November 2022 it was agreed with Together Financial Limited that the loan be renewed
for a further 12 months. The loan bears interest at 0.85% monthly at a variable rate, based on the Bank of
England base rate. In line with the agreement on the loan, when the Bank Street development reached
practical completion in May 2023, as units are sold, the proceeds of these will go toward repayment of the
loan. The loan was repaid in full on 31 May 2023. The loan had two covenants that are linked to the
underlying development, the loan to development cost of 70% and a loan to value of 70%, which have both
been complied with during the reporting period.
On 18 March 2022 the Group had a £1.5 million corporate bond admitted to the Standard List of the London
Stock Exchange. This had a 2 year term and a 8.0% coupon which is paid on 30 June and 31 December each
year. The Group incurred listing costs of £102,040 which were capitalised and released over the term of the
Bond.
Related party borrowings
On 22 July 2020 and 11 August 2020 the Trading Group received loans worth £1,135,000 and £1,007,000
respectively from One Heritage SPC. The loan advanced on 22 July 2020 was repaid during the prior year
with the accrued interest. On 11 April 2023 the remaining loan was repaid in full with the accrued interest.
The Group signed a £5.0 million loan facility with One Heritage Property Development Limited on 21
September 2020. The facility has an interest rate of 7.0%. On 18 February 2021 the facility was increased by
£2.5 million to £7.5 million, this additional amount can only be drawn to fund property development
activities where obtaining project financing is delayed or unavailable. During the 2023 financial year the
facility was further increased by £4.8 million to £12.3 million. Refer to note 25 for a further extension post
year end. The balance on this loan at 30 June 2023 was £11,328,152 (30 June 2022: £7,190,414).
The loan facility balance is due for repayment in December 2024. One Heritage Property Development
Limited confirmed however, that the loan will not be demanded for repayment until such a time that the
Group can afford to repay them without impacting its going concern.
ONE HERITAGE GROUP PLC
75
Terms and repayment schedule
The terms and conditions of outstanding loans are as follows:
30 June 2023
30 June 2022
£ unless stated
Currency
Nominal
interest
rate
Maturity
Date
Fair
value
Carrying
amount
Fair
value
Carrying
Amount
One Heritage SPC
GBB
12.0%
Jan 23
-
-
1,234,776
1,234,776
Lyell Trading
Limited
GBP
9.6%
Nov 22
-
-
2,166,706
2,166,706
Together
Commercial Finance
GBP
10.7%
Dec 22
-
-
1,126,056
1,126,056
Shawbrook Bank
GBP
6.3%
Aug 23
-
-
2,436,564
2,436,564
Hampshire Trust
Bank Limited
GBP
9.3%
Apr 24
4,118,054
4,118,054
-
-
One Heritage
Property
Development
GBP
7.0%
Dec 24
11,378,938
11,378,938
7,190,414
7,190,414
Corporate bond
GBP
8.0%
Mar 24
1,463,797
1,463,797
1,412,777
1,412,777
16,960,789
16,960,789
15,567,293
15,567,293
Reconciliation of movements of liabilities to cash flows from financing activities
Liabilities
£ unless stated
Other loans and
borrowings
Lease
liabilities
Share capital/
Premium
Total
Balance as at 01 July 2022
15,567,293
353,748
3,893,008
19,814,049
Changes from financing cash flows
Proceeds from issue of share capital
-
-
1,247,100
1,247,100
Proceeds from loans and borrowings
4,169,073
-
-
4,169,073
Repayment of loans and borrowings
(5,729,326)
(5,729,326)
Proceeds from related party borrowings
2,953,748
-
-
2,953,748
Interest paid
(2,647,476)
-
-
(2,647,746)
Payment of lease liabilities
-
(86,623)
-
(86,623)
Total changes from financing cash
flows
(1,253,981)
(86,623)
1,247,100
(93,504)
Other changes
Liability related
Capitalised borrowing costs
2,139,232
-
-
2,139,236
Interest expense
508,244
12,607
-
520,851
Total liability-related other changes
2,647,476
12,607
-
2,660,083
Total equity-related other changes
-
-
-
-
Balance as at 30 June 2023
16,960,789
279,732
5,140,108
22,380,628
ONE HERITAGE GROUP PLC
76
Liabilities
£ unless stated
Other loans and
borrowings
Lease
liabilities
Share capital/
Premium
Total
Balance as at 01 July 2021
5,177,455
402,709
3,893,008
9,473,172
Changes from financing cash flows
Proceeds from loans and borrowings
7,131,436
-
-
7,131,436
Repayment of loans and borrowings
(948,743)
(948,743)
Proceeds from related party borrowings
4,215,638
-
-
4,215,638
Interest paid
(1,044,771)
-
-
(1,044,771)
Payment of lease liabilities
-
(64,224)
-
(64,224)
Total changes from financing cash flows
9,353,560
(64,224)
-
9,289,336
Other changes
-
-
-
-
Liability related
Capitalised borrowing costs
1,022,075
-
-
1,022,075
Interest expense
14,203
15,263
-
29,466
Total liability-related other changes
1,036,278
15,263
-
1,051,541
Total equity-related other changes
-
-
-
-
Balance as at 30 June 2022
15,567,293
353,748
3,893,008
19,814,049
20. Trade and other payables
£ unless stated
30 June 2023
30 June 2022
Trade payables
778,995
794,181
Accruals
192,439
115,392
Customer deposits
1,302,276
1,012,222
Related party payable
17,482
-
Tax payable
250,473
-
PAYE payable
37,979
22,837
2,579,644
1,944,632
Trade payables and accruals relate to amounts payable at the reporting date for services received during
the period.
The Group has received deposits and reservation fees in relation to its developments, these totalled
£1,302,276 (30 June 2022: £1,012,222). These relate to units that were exchanged on and are repayable. The
deposits will be repayable if significant property damage occurs, and reinstatement is not possible.
The company has financial risk management policies in place to ensure that all payables are paid within
the credit timeframe.
21. Financial instruments - fair value and risk management
Fair values
For all financial assets and financial liabilities not measured at fair value, the carrying amount is a
reasonable approximation of fair value.
ONE HERITAGE GROUP PLC
77
Financial risk management
The Group has exposure to the following risks arising from financial instruments:
- Credit risk
- Liquidity risk
- Market risk
Risk management framework
The Company’s Board of Directors has overall responsibility for the establishment and oversight of the
Groups risk management framework. The Board of Directors has established the risk management
committee, which is responsible for developing and monitoring the Groups risk management policies. The
committee reports regularly to the Board of Directors on its activities.
The Group’s risk management policies are established to identify and analyse the risks faced by the Group,
to set appropriate risk limits and controls to monitor risks. Risk management policies and systems are
reviewed regularly to reflect changes in market conditions and the Group’s activities. The Group, through
its training and management standards and procedures, aims to maintain a disciplined and constructive
control environment in which all employees understand their roles and obligations.
The Group audit committee oversees how management monitors compliance with the Group’s risk
management policies and procedures and reviews the adequacy of the risk management framework in
relation to the risks faced by the Group.
Credit risk
Credit risk is the risk of financial loss where counterparties are not able to meet their obligations. Group
policy is that surplus cash, when not used to repay borrowings, is placed on deposit with the Group’s main
relationship banks and with other banks or money market funds based on a minimum credit rating and
maximum exposure.
The significant concentrations of credit risk are to related parties (refer note 24).
Management consider that the credit quality of the various receivables is good in respect of the amounts
outstanding and therefore credit risk is considered to be low.
The carrying amount of financial assets represents the Group’s maximum exposure to credit risk at the
reporting date assuming that any security held has no value.
Cash and cash equivalents
The Group held cash and cash equivalents of £303,816 at 30 June 2023 (30 June 2022: £974,201).
Bank
Amount held
Standard and Poor’s
Moody’s
Fitch
Barclays Bank UK Plc
131,806
A
A1
A+
Revolut Bank
172,011
-
-
-
The Group also held petty cash of £241 as at 30 June 2023 (30 June 2022: £672).
Guarantees
The Group’s policy is to provide financial guarantees only for subsidiaries’ liabilities. At 30 June 2023, the
Company has issued a guarantee to certain banks in respect of credit facilities granted to One Heritage
Oscar House Limited £4,118,054 (30 June 2022: £2,185,772). Refer to note 5 and 10 of the Company financial
statements.
Liquidity risk
Liquidity risk is the risk that the Group does not have sufficient financial resources available to meet its
obligations as they fall due. The Group manages liquidity risk by continuously monitoring forecast and
ONE HERITAGE GROUP PLC
78
actual cash flows, matching the expected cash flow timings of financial assets and liabilities with the use
of cash and cash equivalents, borrowings, overdrafts and committed revolving credit facilities with a
minimum of 12 months to maturity.
Future borrowing requirements are forecast on a monthly basis and funding headroom is maintained above
forecast peak requirements to meet unforeseen events. At 30 June 2023, the Group’s borrowings and
facilities had a range of maturities with an average life of 26 months.
In addition to fixed term borrowings, the Group has access to a shareholder loan facility. At the reporting
date, the total unused committed amount available for general purposes was £0.9million and cash and cash
equivalents were £303,816.
The maturity profile of the anticipated future cash flows including interest, using the latest applicable
relevant rate, based on the earliest date on which the Group can be required to pay financial liabilities on
an undiscounted basis, is as follows:
As at 30 June 2023
£ unless stated
Carrying
amount
Total
On
demand
Within 1 year
1-2
years
2-5
years
5+
Years
Non-derivative
financial liabilities
Secured bank debt
5,581,850
5,581,850
-
5,581,580
-
-
-
Other borrowings
11,378,938
11,378,938
-
-
11,378,938
-
-
Lease payables
279,732
279,732
-
99,228
198,456
-
-
Trade payables
2,579,644
2,579,644
-
2,579,644
-
-
-
19,820,164
19,820,164
-
8,260,452
11,577,394
-
-
As at 30 June 2022
£ unless stated
Carrying
amount
Total
On
demand
Within 1 year
1-2
years
2-5
years
5+
Years
Non-derivative
financial liabilities
Secured bank debt
7,142,103
7,677,341
-
5,887,687
1,789,563
-
-
Other borrowings
8,425,190
9,113,289
-
3,588,289
5,525,000
-
-
Lease payables
353,748
399,502
-
99,228
189,070
111,204
-
Trade payables
1,944,632
1,944,632
-
1,944,632
-
-
-
17,865,673
19,134,764
-
11,519,836
7,503,633
111,204
-
The secured bank debt contains loan covenants, disclosed in note 19. A future breach of covenant may
require the Group to repay the loan earlier than indicated in the above table.
Market risk
Market risk is the risk that changes in market prices will affect the Group’s income. The objective of market
risk management is to manage and control risk exposures within acceptable exposures within acceptable
parameters, while optimising the return. The Group does not hold any equity positions and trade in foreign
currencies. It therefore considers the market risk to be low.
Interest rate risk management
The Group has a policy to have fixed interest rate borrowings where possible. Where this is not possible,
the Group will look to hedge interest variability if cost effective.
ONE HERITAGE GROUP PLC
79
Interest rate sensitivity
The Group currently has two variable interest rate arrangements and therefore returns are sensitive to
movements in the interest rates in the next financial period on existing borrowing obligations.
If interest rates on the loans had been 1% per cent higher/lower and all other variables were held constant,
the Group’s loss for the year ended 30 June 2023 would (increase)/decrease by (£423,130)/£340,769. This is
mainly attributable to the Group’s exposure to interest rates on its variable rate borrowings.
22. Directors’ remuneration
£ unless stated
Year to
30 June 2023
Year to
30 June 2022
During the period remuneration payable to
directors was as follows:
Jason Upton
97,154
76,321
Yiu Tak Cheung
15,000
15,000
Jeffrey Pym
-
19,172
Anthony Unsworth
115,794
-
David Izett
29,167
25,000
Jeremy Earnshaw
25,000
6,181
282,115
141,674
The Directors did not receive any other benefits or post-employment remuneration.
23. Share capital
£ unless stated
30 June 2023
30 June 2022
Share capital (1p per share)
386,783
324,283
Share premium
4,753,325
3,568,725
5,140,108
3,893,008
All shares issued by the Company are ordinary shares and have equal voting and distribution rights.
On 07 July 2022 the Group issued 6,250,000 new ordinary shares of 1.0 pence each at an issue price of 20.0
pence per share, raising gross proceeds of £1,250,000.
The total shares in issue as at 30 June 2023 is 38,678,333 (30 June 2022: 32,428,333) and are fully paid up.
24. Related parties
Parent and ultimate controlling party
At the reporting date 65.15% of the shares are held by One Heritage Property Development Limited, which
is incorporated in Hong Kong. One other shareholder holds more than 5.0% of the shares in the Company.
One Heritage Holding Group Limited, incorporated in the British Virgin Island, is considered the ultimate
controlling party through its 100% ownership of One Heritage Property Development Limited.
Transactions with key management
Key management personnel compensation comprised the following:
£ unless stated
Year to
30 June 2023
Year to
30 June 2022
Short term employee benefits
412,851
311,061
412,851
311,061
ONE HERITAGE GROUP PLC
80
Compensation of the Group’s key management personnel is short term employee benefits.
Key management personnel transactions
The key management control 3% (30 June 2022: 31%) of the voting shares of the Company.
Other related party activity
Below is a table that sets out the entities that are related parties to the Group:
Company
Notes
Description
Harley Street Developments
Limited
Common directors, owned by the beneficial owners of
the Group
Mosley Property Limited
Common directors, owned by the beneficial owners of
the Group
One Heritage Great Ducie Street
Limited
7, 17, 19
Common directors, owned by the beneficial owners of
the Group
One Heritage North Church
Limited
7,17,19
Common directors, majority stake held by the beneficial
owners of the Group
One Heritage Property
Development Limited
Common director, owned by the beneficial owners of
the Group
One Heritage Property
Management Limited
Common director, owned by the beneficial owners of
the Group
One Heritage SPC
Managed by the beneficial owners of the Group
One Heritage Tower Limited
7,17,19
Common directors, part owned by the beneficial
owners of the Group
Robin Hood Property
Development Limited
7,17,19
Common directors, owned by the beneficial owners of
the Group
25. Events after the reporting date
On 31 July 2023 the Group facility was increased by £1.7 million, to £14 million. This can be drawn down
as required, has an interest rate of 7.0% and is repayable on 31 December 2024. This additional amount can
only be drawn to fund property development activities where obtaining project financing is delayed or
unavailable.
26. New Standards and amendments to Standards
There are no new or amended standards that are expected to have a significant impact on the Group’s
consolidated financial statements when adopted.
New standards and amendments issued but not effective for the current annual period
The following standards and interpretations had been issued but not yet mandatory for annual reporting
periods ending June 30, 2023.
Description
- Non-current liabilities with Covenants - Amendments to IAS 1 (effective for annual periods
beginning on or after 1 January 2024)
- Classification of Liabilities as Current or Noncurrent – Amendments to IAS 1 (effective for annual
periods beginning on or after 1 January 2024)
- Lease liability in a Sale and Leaseback - Amendments to IFRS 16 (effective for annual periods
beginning on or after 1 January 2024)
- Sale or Contribution of Assets between an investor and its Associate or Joint Venture - IFRS 10 and
IAS 28 (effective date deferred indefinitely)
The Group anticipates that these new standards, interpretations, and amendments will be adopted in the
financial statements as and when they are applicable and adoption of these new standards, interpretations
ONE HERITAGE GROUP PLC
81
and amendments, may have no material impact on the financial statements in the period of initial
application.
27. Disclosures relating to subsidiary undertakings
The Company’s subsidiaries and other related undertakings at 30 June 2023 are listed below. All Group
entities are included in the consolidated financial results. All companies listed below undertake all of
their activity in the United Kingdom.
The share capital of each of the companies, where applicable, comprises ordinary shares unless
otherwise stated.
Company name
Business activity
Company
number
Ownership
One Heritage Property Development
(UK) Limited
Property developer
11982934
100.0%
One Heritage Churchgate Limited
Development company
12114319
100.0%
One Heritage Lincoln House Limited
Development company
12434625
100.0%
One Heritage Bank Street Limited
Development company
12763845
100.0%
One Heritage Oscar House Limited
Development company
11331256
100.0%
One Heritage St Petersgate Limited
Development company
13154858
100.0%
One Heritage Red Brick Limited
Property services
13178461
100.0%
One Heritage Property Services Limited
Property services
13426415
100.0%
One Heritage Seaton House Limited
Development company
13520340
100.0%
One Heritage Construction Limited
Construction company
13761479
100.0%
One Heritage Victoria Road Limited
Development company
14172104
100.0%
St Petersgate Building Management
Limited
Dormant
13979905
100.0%
Oscar House Building Management
Limited
Dormant
13981057
100.0%
Liberty House Building Management
Limited
Dormant
13986387
100.0%
Lincoln House Building Management
Limited
Dormant
12710283
100.0%
OH Oscar House Property Limited
Dormant
14969230
100.0%
OH Lincoln House Property Limited
Dormant
14255279
100.0%
There are loans between these entities, which are all interest free and repayable on demand.
28. Audit exemption taken for subsidiaries
The following subsidiaries are exempt from the requirements of the Companies Act 2006 relating to the
audit of individual accounts by virtue of Section 479A of that Act.
Company name
Company number
One Heritage Property Development (UK) Limited
11982934
One Heritage Churchgate Limited
12114319
One Heritage Lincoln House Limited
12434625
One Heritage Bank Street Limited
12763845
One Heritage Oscar House Limited
11331256
One Heritage St Petersgate Limited
13154858
One Heritage Red Brick Limited
13178461
One Heritage Property Services Limited
13426415
One Heritage Seaton House Limited
13520340
ONE HERITAGE GROUP PLC
82
One Heritage Construction Limited
13761479
One Heritage Victoria Road Limited
14172104
St Petersgate Building Management Limited
13979905
Oscar House Building Management Limited
13981057
Liberty House Building Management Limited
13986387
Lincoln House Building Management Limited
12710283
ONE HERITAGE GROUP PLC
83
FINANCIAL STATEMENTS
Company balance sheet
As at 30 June 2023
£ unless stated
Notes
As at 30 June
2023
As at 30 June
2022
INTANGIBLE ASSETS
Trademark
1,913
2,324
1,913
2,324
TANGIBLE ASSETS
Investments
2
1,007,732
2,750,100
1,007,732
2,750,100
OTHER NON-CURRENT ASSETS
Debtors*
3
3,033,711
2,183,153
3,033,711
2,183,153
CURRENT ASSETS
Debtors*
4
302,351
127,719
Cash at bank
8,615
4,383
310,966
132,102
Creditors: amounts falling within one year
5
(5,191,231)
(55,975)
Net current (liabilities)/assets
(4,880,265)
2,259,280
Total assets less current liabilities
(836,909)
5,011,704
Creditors: amounts due after one year
6
-
(1,412,777)
Net assets
(836,909)
3,598,927
CAPITAL AND RESERVES
Called up share capital
7
386,783
324,283
Share premium account
4,753,325
3,568,725
Profit and loss account
(5,977,017)
(294,081)
Shareholders’ funds
(836,909)
3,598,927
*restated (note 1)
These financial statements were approved by the board of directors on 31 October 2023 and were signed
on its behalf by:
Jason David Upton
Company registration number: 12757649
The accompanying notes on pages 85 to 90 form an integral part of the financial statements
Jason upton (Oct 31, 2023 21:04 GMT+8)
ONE HERITAGE GROUP PLC
84
FINANCIAL STATEMENTS
Company statement of changes in equity
For the year ended 30 June 2023
£ unless stated
Called up
share capital
Share
premium
Profit and loss
account
Shareholders
Funds
Balance at 1 July 2022
324,283
3,568,725
(294,081)
3,598,927
Loss for the period
-
-
(5,682,936)
(5,682,936)
Total comprehensive income for
the period
324,283
3,568,725
(5,977,017)
(2,084,009)
Issue of share capital
62,500
1,187,500
-
1,250,000
Cost of share issuance
-
(2,900)
-
(2,900)
Balance at 30 June 2023
386,783
4,753,325
(5,977,017)
(836,909)
For the year ended 30 June 2022
£ unless stated
Called up
share capital
Share
premium
Profit and loss
account
Shareholders
Funds
Balance at incorporation
324,283
3,568,725
(123,154)
3,769,854
Loss for the period
-
-
(170,927)
(170,927)
Total comprehensive income for
the period
324,283
3,568,725
(294,081)
3,598,927
Balance at 30 June 2022
324,283
3,568,725
(294,081)
3,598,927
The accompanying notes on pages 85 to 90 form an integral part of the financial statements.
ONE HERITAGE GROUP PLC
85
FINANCIAL STATEMENTS
Notes to the Company financial statements
For the year ended to 30 June 2023
1. Accounting policies
The following accounting policies have been applied consistently in dealing with items which are
considered material in relation to the financial statements, except as noted below.
General information
One Heritage Group plc is a public limited company, limited by shares, incorporated in England and Wales
under the Companies Act 2006 on 21 July 2020. The address of its registered office and principal place of
trading is 80 Mosley Street, Manchester, M2 3FX. The principal activity of the Company is a property
development holding company. The Company does not have any employees and is funded through the
issuance of share capital to investors.
Basis of preparation
These financial statements were prepared in accordance with Financial Reporting Standard 101 Reduced
Disclosure Framework (“FRS 101”).
In preparing these financial statements, the Company applies the recognition, measurement and disclosure
requirements of international accounting standards in conformity with the requirements of the Companies
Act 2006 (“Adopted IFRSs”) but makes amendments where necessary in order to comply with Companies
Act 2006 and has set out below where advantage of the FRS 101 disclosure exemptions has been taken.
Under section s408 of the Companies Act 2006 the Company is exempt from the requirement to present its
own profit and loss account.
Restatement
The prior year presentation of the amount due from subsidiary of £2,183,153 has been reclassified from
current asset to other non-current asset. This correction has been made in order to reflect that the amount
was not expected to be settled in the ordinary course of business in the next 12 months. The impact of this
restatement reduced current assets by £2,182,153 and increased other non-current assets by the same
amount.
In these financial statements, the Company has applied the exemptions available under FRS 101 in respect
of the following disclosures:
▪ Cash Flow Statement and related notes;
▪ Certain disclosures regarding revenue;
▪ Certain disclosures regarding leases;
▪ Disclosures in respect of transactions with wholly owned subsidiaries;
▪ Disclosures in respect of capital management;
▪ The effects of new but not yet effective IFRSs;
▪ Disclosures in respect of the compensation of Key Management Personnel;
▪ Disclosures of transactions with a management entity that provides key management personnel
services to the Company.
As the consolidated financial statements include the equivalent disclosures, the Company has also taken
the exemptions under FRS 101 available in respect of the following disclosures:
▪ Certain disclosures required by IFRS 3 Business Combinations in respect of business combinations
undertaken by the Company in the current and prior periods; and
▪ Certain disclosures required by IFRS 13 Fair Value Measurement and the disclosures required by IFRS
7 Financial Instrument Disclosures.
ONE HERITAGE GROUP PLC
86
▪ Certain disclosures required by IAS 36 Impairment of Assets
Going concern
Notwithstanding net current liabilities of £4.9 million as at 30 June 2023 (2022: net current assets £2.3
million) and a loss for the year then ended of £5.68 million (2022: £0.17 million), the financial statements
have been prepared on a going concern basis which the directors consider to be appropriate for the
following reasons.
The directors have prepared a cash flow forecast for the period to 31 December 2024 on a consolidated
basis which indicates that, taking account of reasonably possible downsides, the Company will have
sufficient funds through existing resources held by the company and subsidiaries (including funds drawn
down on the parent company loan facility post year-end), the continued forecast realisations of
development property inventory by its subsidiaries, and in the event of need continued financial support
from its parent company, One Heritage Property Development Limited (“OHPD”), to meet its liabilities as
they fall due for that period, including the Corporate Bond of £1.5 million due for repayment in March 2024.
As with any company placing reliance on other group/related entities for financial support, the directors
acknowledge that there can be no certainty that this support will continue although, at the date of approval
of these financial statements, they have no reason to believe that it will not do so.
Consequently, the directors are confident that the Company will have sufficient funds to continue to meet
its liabilities as they fall due for at least 12 months from the date of approval of the financial statements and
therefore have prepared the financial statements on a going concern basis.
The accounting policies set out below have, unless otherwise stated, been applied consistently to all periods
presented in these financial statements.
Measuring convention
The financial statements are prepared on the historical cost.
Significant judgements
The significant judgements with regard to going concern are the forecast timing of development property
inventory realisations and in the event it is needed the ability of the Group to be able to drawdown on the
facility by its parent company, One Heritage Property Development Limited (“OHPD”). Management of the
Company is not aware of any material uncertainties that may cast significant doubt on the Company’s
ability to continue as a going concern. Therefore, the parent company financial statements continue to be
prepared on the going concern basis. For detail refer note 1 going concern.
Financial guarantees
A financial guarantee contract is initially recognised at fair value. At the end of each subsequent reporting
period, financial guarantees are measured at the higher of:
▪ The amount of the loss allowance, and
▪ The amount initially recognised less cumulative amortisation, where appropriate.
The amount of the loss allowance at each subsequent reporting period equals the 12-month expected credit
losses. However, where there has been a significant increase in the risk that the specified debtor will default
on the contract, the calculation is for lifetime expected credit losses.
Investment in subsidiary
Investment in and loans to subsidiaries are stated at cost less impairment.
ONE HERITAGE GROUP PLC
87
Impairment
The carrying amounts of the Company’s non-financial assets are reviewed at each reporting date to
determine whether there is any indication of impairment. If any such indication exists, then the asset’s
recoverable amount is estimated.
The recoverable amount of an asset or cash-generating unit is the greater of its value in use and its fair
value less costs to sell. 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 the purpose of impairment testing, assets that cannot be
tested individually are grouped together into the smallest group of assets that generates cash inflows from
continuing use that are largely independent of the cash inflows of other assets or groups of assets (the
“cash-generating unit”).
An impairment loss is recognised if the carrying amount of an asset or its CGU exceeds its estimated
recoverable amount. Impairment losses are recognised in profit or loss. Impairment losses recognised in
respect of CGUs are allocated first to reduce the carrying amount of any goodwill allocated to the units, and
then to reduce the carrying amounts of the other assets in the unit (group of units) on a pro rata basis.
In respect of other assets, impairment losses recognised in prior periods are assessed at each reporting
date for any indications that the loss has decreased or no longer exists. An impairment loss is reversed if
there has been a change in the estimates used to determine the recoverable amount. An impairment loss
is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that
would have been determined, net of depreciation or amortisation, if no impairment loss had been
recognised.
2. Investment in subsidiaries
£ unless stated
30 June 2023
30 June 2022
One Heritage Property Development (UK) Limited
1,007,732
2,750,100
1,007,732
2,750,100
The Company assesses the subsidiaries for any indicators of impairment by looking at the individual
performance of the underlying entities, including their budgets, development progress and forecast
profitability.
Due to losses in the underlying subsidiaries, the investment in subsidiaries were impaired in the current
year by £1,742,368 (2022: £nil) in order to reflect the estimated recoverable amount based on the net asset
value of the subsidiary entity and net realisable value of inventory. The impairment was recognised in the current
year as a consequence of the losses and impairment to inventory recognised by Group entities. The carrying
amount is considered to reflect the fair value less costs of disposal and is considered a level 3 asset in the fair
value hierarchy.
The share capital of each of the companies, where applicable, comprises ordinary shares unless
otherwise stated.
Company name
Jurisdiction
Company number
Ownership
One Heritage Property Development (UK)
Limited
England and
Wales
11982934
100.0%
ONE HERITAGE GROUP PLC
88
Below is a list of the key subsidiaries of One Heritage Property Development (UK) Limited.
Company name
Jurisdiction
Company number
Ownership
One Heritage Churchgate Limited
England and
Wales
12114319
100.0%
One Heritage Lincoln House Limited
England and
Wales
12434625
100.0%
One Heritage Bank Street Limited
England and
Wales
12763845
100.0%
One Heritage Oscar House Limited
England and
Wales
11331256
100.0%
One Heritage St Petersgate Limited
England and
Wales
13154858
100.0%
One Heritage Red Brick Limited
England and
Wales
13178461
100.0%
One Heritage Property Services Limited
England and
Wales
13426415
100.0%
One Heritage Seaton House Limited
England and
Wales
13520340
100.0%
One Heritage Construction Limited
England and
Wales
13761479
100.0%
One Heritage Victoria Road Limited
England and
Wales
14172104
100.0%
St Petersgate Building Management
Limited
England and
Wales
13979905
100.0%
Oscar House Building Management
Limited
England and
Wales
13981057
100.0%
Liberty House Building Management
Limited
England and
Wales
13986387
100.0%
Lincoln House Building Management
Limited
England and
Wales
12710283
100.0%
3. Debtors: amounts receivable within one year
£ unless stated
30 June 2023
30 June 2022
Intercompany loan
-
2,183,153
Trade and other receivables
270,000
90,000
Prepayments
32,351
37,719
302,351
2,310,872
4. Debtors: amounts receivable after one year
£ unless stated
30 June 2023
30 June 2022
Intercompany loan
3,033,711
-
3,033,711
-
The Intercompany loan payable by One Heritage Property Development (UK) Limited is interest free and
payable on demand.
The Company assesses the intercompany loans for any indicators of impairment by looking at the
individual performance of the underlying entities, including their budgets, development progress and
forecast profitability. There are no indicators of impairment and therefore no expected credit losses.
ONE HERITAGE GROUP PLC
89
5. Creditors: amounts falling within one year
£ unless stated
30 June 2023
30 June 2022
Trade and other payables
15,000
16,393
Accruals
76,780
37,500
Corporate bond
1,463,797
-
Parental guarantee provision (refer to note 10)
3,635,109
-
Tax payable
545
2,082
5,191,231
55,975
6. Creditors: amounts due after one year
£ unless stated
30 June 2023
30 June 2022
Corporate bond
-
1,412,777
-
1,412,777
On 18 March 2022 the Group had a £1.5 million corporate bond admitted to the Standard List of the London
Stock Exchange. This had a 2 year term and a 8.0% coupon which is paid on 30 June and 31 December each
year. The Group incurred listing costs of £102,040, which were capitalised and released over the term of
the Bond. The bond is repayable in March 2024.
7. Called up share capital
£ unless stated
Ordinary
Shares
Issued share capital as at 30 June 2023
38,440,561
38,440,561
The holders of ordinary shares are entitled to receive dividends as declared from time to time and are
entitled to one vote per share at meetings of the Company.
On 07 July 2022 the Company issued 6,250,000 new ordinary shares of 1.0 pence each at an issue price of
20.0 pence per share, raising gross proceeds of £1,250,000.
8. Audit exemption taken for subsidiaries
The following subsidiaries are exempt from the requirements of the Companies Act 2006 relating to the
audit of individual accounts by virtue of Section 479A of that Act. Under the Act the Company has
undertaken guarantees for all outstanding liabilities to which the subsidiary company is subject at the end
of the financial year to which the guarantee relates, until they are satisfied in full.
Company name
Company number
One Heritage Property Development (UK) Limited
11982934
One Heritage Churchgate Limited
12114319
One Heritage Lincoln House Limited
12434625
One Heritage Bank Street Limited
12763845
One Heritage Oscar House Limited
11331256
One Heritage St Petersgate Limited
13154858
One Heritage Red Brick Limited
13178461
One Heritage Property Services Limited
13426415
One Heritage Seaton House Limited
13520340
One Heritage Construction Limited
13761479
One Heritage Victoria Road Limited
14172104
St Petersgate Building Management Limited
13979905
ONE HERITAGE GROUP PLC
90
Oscar House Building Management Limited
13981057
Liberty House Building Management Limited
13986387
Lincoln House Building Management Limited
12710283
9. Post balance sheet events
On 31 July 2023 the Company facility was increased by £1.7 million, to £14 million. This can be drawn down
as required, has an interest rate of 7.0% and is repayable on 31 December 2024. This additional amount can
only be drawn to fund property development activities where obtaining project financing is delayed or
unavailable.
10. Related party disclosures
The Directors of the Company were paid through One Heritage Property Development (UK) Limited, a
subsidiary.
£ unless stated
Year to
30 June 2023
Year to
30 June 2022
During the period remuneration payable to
directors was as follows:
Jason Upton
97,154
76,321
Yiu Tak Cheung
15,000
15,000
Jeffrey Pym
-
19,172
Anthony Unsworth
115,794
-
David Izett
29,167
25,000
Jeremy Earnshaw
25,000
6,181
282,115
141,674
Guarantees
The Company’s policy is to provide financial guarantees only for subsidiaries’ liabilities. At 30 June 2023,
the Company has issued a guarantee to certain banks in respect of credit facilities granted to One Heritage
Oscar House Limited £4,118,054 (30 June 2022: £2,185,772). Refer to note 5 for provisions recognised.
Refer to note 8 for additional guarantees undertaken by the Company and note 5 for provisions recognised.
Parent and ultimate controlling party
At the reporting date 63.8% of the shares are held by One Heritage Property Development Limited, which
is incorporated in Hong Kong. Keith Crews held 9.6% of the shares at the reporting date.
No other shareholder holds more than 5.0% of the shares in the Company. One Heritage Holding Group
Limited, incorporated in the British Virgin Island, is considered the ultimate controlling party through its
100% ownership of One Heritage Property Development Limited.
ONE HERITAGE GROUP PLC
91
ONE HERITAGE GROUP PLC
Notice of Annual General Meeting
NOTICE IS GIVEN that the Annual General Meeting (the “AGM”) of One Heritage Group plc (the
“Company”) will be held at 10.00 a.m. on 30
th
November 2023 at the offices of Shakespeare Martineau
LLP, 6
th
Floor, 60 Gracechurch Street, London, EC3V 0HR to consider and if thought fit, pass the
following resolutions. Resolutions 1 to 5 will be proposed as ordinary resolutions and resolutions 6
and 7 will be proposed as special resolutions.
ORDINARY RESOLUTIONS
1. To receive the Company’s annual report and accounts for the year ended 30 June 2023.
2. To approve the remuneration report set out on pages 34 to 38 of the annual report for the
year ended 30 June 2023.
3. To re-appoint KPMG Audit LLC as auditor of the Company.
4. To authorise the Directors to determine the auditor’s remuneration.
5. That, the Directors be generally and unconditionally authorised in accordance with section 551
of the Companies Act 2006 (the ‘Act’) and in substitution for all existing authorities under that
section, to exercise all the powers of the Company to allot shares in the Company or to grant
rights to subscribe for, or to convert any security into, shares in the Company (‘Rights’) up to
an aggregate nominal amount of £193,391.67 during the period commencing on the date of
the passing of this resolution and expiring at the conclusion of the next Annual General
Meeting of the Company or 15 months from the passing of this resolution, whichever is earlier,
and provided further that the Company shall be entitled before such expiry to make an offer
or agreement which would or might require shares to be allotted or Rights to be granted after
such expiry and the Directors shall be entitled to allot shares and grant Rights under such offer
or agreement as if this authority had not expired.
SPECIAL RESOLUTIONS
6. THAT, subject to and conditional upon the passing of Resolution 5 the Directors be and they
are hereby authorised pursuant to Section 570 of the Act to allot equity securities (as defined
in Section 560 of the Act) for cash pursuant to the authority conferred by resolution 5 above
as if Section 561(1) of the Act did not apply to any such allotment, provided that this power
shall be limited to:
a) the allotment of equity securities in connection with an issue in favour of shareholders
where the equity securities respectively attributable to the interests of all such
shareholders are proportionate (or as nearly as may be practicable) to the respective
number of Ordinary Shares in the capital of the Company held by them on the record date
for such allotment, but subject to such exclusions or other arrangements as the Directors
may deem necessary or expedient in relation to fractional entitlements or legal or practical
problems under the laws of, or the requirements of, any recognised regulatory body or any
stock exchange, in any territory;
b) the allotment of equity securities arising from the conversion of any other convertible
securities outstanding at the date of this resolution; and
ONE HERITAGE GROUP PLC
92
c) the allotment (otherwise than pursuant to sub-paragraph (a) and (b) above) of further
equity securities up to an aggregate nominal amount of £193,391.67;
provided that this power shall, unless previously revoked or varied by special resolution of the
Company in general meeting, expire at the conclusion of the Annual General Meeting of the
Company to be held in 2024 or 15 months from the passing of this resolution, whichever is
earlier. The Company may, before such expiry, make offers or agreements which would or might
require equity securities to be allotted after such expiry and the Directors are hereby
empowered to allot equity securities in pursuance of such offers or agreements as if the power
conferred hereby had not expired.
7. That a general meeting of the Company (other than an annual general meeting) may be
called on not less than 14 clear days’ notice.
By Order of the Board
Shaun Zulafqar
Company Secretary
3 November 2023
Registered Office
6th Floor, 60 Gracechurch
Street
London EC3V 0HR
ONE HERITAGE GROUP PLC
93
Notice of Meeting Notes:
The following notes explain your general rights as a shareholder and your right to attend and vote at this Meeting or to appoint someone
else to vote on your behalf.
1) Pursuant to the Company’s Articles of Association, a member of the Company entitled to attend and vote at the meeting
convened by this notice is entitled to appoint one or more proxies to exercise any of his rights to attend, speak and vote at
that meeting on his behalf.
2) If a member appoints more than one proxy, each proxy must be entitled to exercise the rights attached to different shares.
If you submit more than one valid proxy appointment in respect of the same shares, the appointment received last before
the latest time for the receipt of proxies will take precedence.
3) A proxy may only be appointed using the procedures set out in these notes and the notes to the form of proxy. To validly
appoint a proxy, a member must complete, sign and date the enclosed form of proxy and deposit it at the office of the
Company's registrars, Neville Registrars, at Neville House, Steelpark Road, Halesowen, West Midlands B62 8HD, by 10:00
a.m. on 28
th
November 2023 (or, in the event that the meeting is adjourned, not less than 48 hours, excluding non-working
days, before the time fixed for the holding of the adjourned meeting). Any power of attorney or any other authority under
which the form of proxy is signed (or a duly certified copy of such power or authority) must be enclosed with the form of
proxy.
4) In order to revoke a proxy appointment, a member must sign and date a notice clearly stating his intention to revoke his
proxy appointment and deposit it at the office of the Company's registrars, Neville Registrars, at Neville House, Steelpark
Road, Halesowen, West Midlands B62 8HD prior to commencement of the meeting. If the revocation is received after the
time specified, the original proxy appointment will remain valid unless the member attends the meeting and votes in person.
5) Pursuant to the Articles of Association, any corporation which is a member of the Company may authorise one or more
persons (who need not be a member of the Company) to attend, speak and vote at the meeting as the representative of that
corporation. A certified copy of the board resolution of the corporation appointing the relevant person as the representative
of that corporation in connection with the meeting must be deposited at the office of the Company's registrars, Neville
Registrars, at Neville House, Steelpark Road, Halesowen, West Midlands B62 8HD prior to the commencement of the
meeting. If the revocation is received after the time specified, the original corporate representative appointment will remai n
valid unless the member attends the meeting and votes in person.
6) In the case of joint holders, where more than one of the joint holders purports to appoint a proxy in respect of the same
shares, only the appointment submitted by the most senior holder will be accepted. Seniority is determined by the order in
which the names of the joint holders appear in the Company’s register of members in respect of the joint holding (the first
named being the most senior).
7) The right to vote at the meeting shall be determined by reference to the register of members of the Company. Pursuant to
Regulation 41 of the Uncertificated Securities Regulations 2001 (as amended), only those persons whose names are entered
on the register of members of the Company at 6.00 p.m. on 28
th
November 2023 (or, in the event of any adjournment, at
6.00 p.m. on the date which is two days prior to the adjourned meeting) shall be entitled to attend and vote in respect of
the number of shares registered in their names at that time. Changes to entries on the register of members after that time
shall be disregarded in determining the rights of any person to vote at the meeting.
8) CREST members who wish to appoint a proxy or proxies through the CREST electronic proxy appointment service may do so
for the meeting and any adjournment(s) thereof by using the procedures described in the CREST Manual (available via
www.euroclear.com). CREST personal members or other CREST sponsored members, and those CREST members who have
appointed a voting service provider(s), should refer to their CREST sponsor or voting service provider(s), who will be able t o
take the appropriate action on their behalf.
9) In order for a proxy appointment or instruction made by means of the CREST service to be valid, the appropriate CREST
message (a "CREST Proxy Instruction") must be properly authenticated in accordance with Euroclear UK & International
Limited's ("Euroclear") specifications and must contain the information required for such instructions, as described in the
CREST Manual. The message, regardless of whether it constitutes the appointment of a proxy or is an amendment to the
instruction given to a previously appointed proxy must, in order to be valid, be transmitted so as to be received by the
Company's agent (ID 7RA11) by the latest time for proxy appointments set out in paragraph 3 above. For this purpose, the
time of receipt will be taken to be the time (as determined by the timestamp applied to the message by the CREST
Applications Host) from which the Company's agent is able to retrieve the message by enquiry to CREST in the manner
ONE HERITAGE GROUP PLC
94
prescribed by CREST. After this time any change of instructions to proxies appointed through CREST should be communicated
to the appointee through other means.
10) CREST members and, where applicable, their CREST sponsors or voting service providers should note that Euroclear does not
make available special procedures in CREST for any particular messages. Normal system timings and limitations will
therefore, apply in relation to the input of CREST Proxy Instructions. It is the responsibility of the CREST member concerned
to take (or, if the CREST member is a CREST personal member or sponsored member or has appointed a voting service
provider(s), to procure that his CREST sponsor or voting service provider(s) take(s)) such action as shall be necessary to
ensure that a message is transmitted by means of the CREST system by any particular time. In this connection, CREST
members and, where applicable, their CREST sponsors or voting service providers are referred, in particular, to those sections
of the CREST Manual concerning practical limitations of the CREST system and timings. The Company may treat as invalid a
CREST Proxy Instruction in the circumstances set out in Regulation 35(5)(a) of the Uncertificated Securities Regulations 2001
(as amended).
11) Any corporation which is a shareholder can appoint one or more corporate representatives who may exercise on its behalf
all of its powers as a shareholder provided that no more than one corporate representative exercises powers in relation to
the same shares.
12) Any shareholder attending the Meeting has the right to ask questions. The Company must cause to be answered any such
question relating to the business being dealt with at the Meeting but no such answer need be given if: (a) to do so would
interfere unduly with the preparation for the Meeting or involve the disclosure of confidential information; (b) the answer
has already been given on a website in the form of an answer to a question; or (c) it is undesirable in the interests of the
Company or the good order of the Meeting that the question be answered.
13) You may not use any electronic address (within the meaning of Section 333(4) of the Companies Act 2006) provided in either
this Notice or any related documents (including the form of proxy) to communicate with the Company for any purposes
other than those expressly stated.
14) A copy of this Notice, and other information required by Section 311A of the Companies Act 2006, can be found on the
Company’s website at https://www.oneheritageplc.com/.
15) At 2 November 2023, (being the latest practicable date prior to the publication of this notice) the issued share capital of the
Company consisted of 38,678,333 Ordinary Shares of 1 pence each in the capital of the Company. Each share carries one
vote. The Company held no shares in treasury, therefore the total voting rights in the Company as at 2 November 2023 were
38,678,333.
ONE HERITAGE GROUP PLC
95
EXPLANATION OF BUSINESS
Resolution 1: To receive the annual report and accounts
Company law requires the Directors to present the annual report and accounts of the Company to
shareholders in respect of each financial year.
Resolution 2: To approve the remuneration report
The remuneration report is set out on pages 34 to 38 of the annual financial report. It gives details of
the Directors’ remuneration for the year ended 30 June 2023. The vote is advisory and does not affect
the actual remuneration paid to any individual Director.
Resolution 3 and 4: To reappoint the auditor and authorise the Board to determine their
remuneration
The Company is required to appoint an auditor at each general meeting at which accounts are laid
before the members, to hold office until the conclusion of the next such meeting. Resolution 3 is for
members to reappoint KPMG Audit LLC as auditors of the Company and resolution 4 proposes that
shareholders authorise the Board to determine the remuneration of the auditors. In practice, the audit
committee will consider the audit fees and recommend them to the Board.
Resolution 5: Directors’ authority to allot shares
Resolution 5 authorises the Directors to allot shares in the Company until the conclusion of the next
AGM or 15 months from the passing of this resolution, whichever is earlier. The resolution would give
the Directors authority to allot ordinary shares, and grant rights to subscribe for or convert any
security into shares in the Company, up to an aggregate nominal value of £193,391.67. This amount
represents half of the issued ordinary share capital of the Company as at 2 November 2023, the latest
practicable date prior to the publication of this document.
Resolution 6: Disapplication of pre-emption rights
If Directors of a Company wish to allot shares in the Company, or to sell treasury shares, for cash (other
than in connection with an employee share scheme) company law requires that these shares are
offered first to shareholders in proportion to their existing holdings.
The purpose of Resolution 6 is to authorise the Directors to allot ordinary shares in the Company, or
sell treasury shares, for cash (i) in connection with a rights issue; and, otherwise, (ii) up to a nominal
value of £193,391.67, equivalent to half of the total issued ordinary share capital of the Company as
at 2 November 2023 without the shares first being offered to existing shareholders in proportion to
their holdings.
Resolution 7: Approval for calling of general meetings (other than AGMs) on 14 days’ notice
Under company law, the Company is required to give 21 clear days’ notice for a general meeting of
the Company unless shareholders approve a shorter notice period, which cannot be less than 14 clear
days (AGMs must continue to be held on at least 21 clear days’ notice).
Resolution 7 proposes a special resolution and seeks shareholder approval to enable the Company to
call general meetings, other than AGMs, on at least 14 clear days’ notice. The approval will be effective
until the Company’s next AGM, when it is intended that a similar resolution will be proposed. The
ONE HERITAGE GROUP PLC
96
flexibility offered by this resolution will be used where, taking into account the circumstances, the
Directors consider to be appropriate in relation to the business to be considered at the meeting in
question and where it is thought to be to the advantage of shareholders as a whole. In order to be
able to call a general meeting on less than 21 clear days’ notice, the Company must make a means of
electronic voting available to all shareholders for that meeting.
Retirement by Rotation
The Company’s articles of association provide for each director appointed during the year to retire at
the next annual general meeting and for each director to retire from office at the third annual general
meeting after the AGM at which he/she was previously appointed or reappointed. According to the
company's articles of association, none of the directors are eligible to retire by rotation this year. As
announced on 29
th
September 2023, Anthony Unsworth, Chief Financial Officer and Executive
Director, will depart the Company at the end of March 2024. Directors’ biographical details are given
on pages 19 to 20 of the annual financial report.
2023 06 30_OHG AFS_31.10
Final Audit Report 2023-10-31
Created: 2023-10-31
By: Jacqueline van Heerden (jacqueline.vanheerden@one-heritage.com)
Status: Signed
Transaction ID: CBJCHBCAABAAiG2ogVEO_-CN0ljT_ZY5IOI8HySK38Hj
"2023 06 30_OHG AFS_31.10" History
Document created by Jacqueline van Heerden (jacqueline.vanheerden@one-heritage.com)
2023-10-31 - 12:01:13 PM GMT
Document emailed to anthony.unsworth@one-heritage.com for signature
2023-10-31 - 12:05:21 PM GMT
Email viewed by anthony.unsworth@one-heritage.com
2023-10-31 - 12:15:05 PM GMT
Signer anthony.unsworth@one-heritage.com entered name at signing as A Unsworth
2023-10-31 - 12:15:36 PM GMT
Document e-signed by A Unsworth (anthony.unsworth@one-heritage.com)
Signature Date: 2023-10-31 - 12:15:38 PM GMT - Time Source: server
Document emailed to jason.upton@one-heritage.com for signature
2023-10-31 - 12:15:40 PM GMT
Email viewed by jason.upton@one-heritage.com
2023-10-31 - 1:03:43 PM GMT
Signer jason.upton@one-heritage.com entered name at signing as Jason upton
2023-10-31 - 1:04:18 PM GMT
Document e-signed by Jason upton (jason.upton@one-heritage.com)
Signature Date: 2023-10-31 - 1:04:20 PM GMT - Time Source: server
Document emailed to david.izett@one-heritage.com for signature
2023-10-31 - 1:04:22 PM GMT
Email viewed by david.izett@one-heritage.com
2023-10-31 - 1:22:53 PM GMT
Signer david.izett@one-heritage.com entered name at signing as David Izett
2023-10-31 - 1:23:46 PM GMT
Document e-signed by David Izett (david.izett@one-heritage.com)
Signature Date: 2023-10-31 - 1:23:48 PM GMT - Time Source: server
Agreement completed.
2023-10-31 - 1:23:48 PM GMT