REG-Alina Holdings PLC Alina Holdings PLC:Annual Financial Report
30/04/2024 11:30
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Alina Holdings PLC (ALNA)
Alina Holdings PLC:Annual Financial Report
30-Apr-2024 / 11:26 GMT/BST
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Alina Holdings PLC
Alina Holdings PLC
(Reuters: ALNA.L, Bloomberg: ALNA:LN)
(“Alina”, “ALNA” or the “Company”)
AUDITED RESULTS FOR THE YEAR ENDED 31 DECEMBER 2023
The Company today announces its audited results for the year ended 31 December
2023.
The information set out below is extracted from the Company's Report and Accounts
for the year ended 31 December 2023, which will be published today on the Company's
website 1 www.alina-holdings.com. A copy has also been submitted to the National
Storage Mechanism where it will be available for inspection. Cross-references in
the extracted information below refer to pages and sections in the Company's Report
and Accounts for the year ended 31 December 2023.
REPORT FOR THE YEAR TO 31 DECEMBER 2023
Alina Holdings PLC (“Alina” or the “Company”) is a company registered on the Main
Market of the London Stock Exchange. The group financial statements consolidate
those of the Company and its subsidiaries (together referred to as the “Group”).
CHAIRMAN’S STATEMENT
Writing one’s own report card is always a time for self-reflection, particularly
when the conclusion is “could have done better”.
In 2023 we…read I…definitely could have done better. Following the Q3 correction,
the NASDAQ 100 (NDX) staged a remarkable recovery and, from 27 October to 29
December, surged 27.6%. Driven by the Magnificent 7, which contributed nearly half
of the broader market’s 2023 performance, and its poster child Nvidia (NVDA), which
rose 239%, the NDX registered a 54.9% for the year when many, including ourselves,
had anticipated a recession due to higher interest rates and sticky inflation. The
irony is not lost on us as we have since been proven right and the anticipated Fed
Pivot has not yet happened, as inflation has proven stickier that most had
predicted.
Alina’s portfolio of assets is a mixture of Operating, financial (including cash)
assets, and a limited number of hedge positions. Clearly hedging doesn’t always
work, and on occasion it backfires and increases risk. In 2023, our hedging
activities were a small drag on our results but, as with any insurance policy,
there is always a price for protection. I am pleased to report that since the end
of the year, our largest short position in Tesla (TSLA) generated a realised gain
of $731k (£587K at £/$ 1.2437) or a return on average capital employed (ROACE) of
258%. The TSLA short position was closed out on 23 April 2024, the morning before
TSLA reported Q1 earnings.
Property Assets
Brislington, Bristol: Currently underperforming our expectations due to tenant
problems, partially caused by scaffolding erected for work on the Landlord’s
adjacent building that are currently moribund.
Castle Court, Hastings: Former Argos unit has now been refurbished and asbestos
removed. Claim for expenditure plus costs will now be submitted to Sainsbury’s, the
new owner’s of Argos per the ‘full repairing lease’ that they have ignored.
Former Italian Way (restaurant) unit has now been recovered from illegal tenant
that had taken occupation without even bothering to apply for a lease.
Refurbishment will be undertaken and application to expand the unit will be sought
from Hastings Council, the Freehold owner.
Shaw, Suffolk: Small unit, in the process of being sold.
Outlook
Sadly, I do not believe that Geo-political risk is properly reflected in current US
share prices. Therefore, the likelihood of the correction we anticipated last year,
but which turned into an enormous AI infused rally, still exists. Whilst we will
always be substantially skewed to the long side, we will continue to try and
protect downside risk.
Duncan Soukup
Chairman
Alina Holdings plc 29 April 2024
FINANCIAL REVIEW
The financial statements contained in this report have been prepared in accordance
with UK Adopted International Accounting Standards.
Result
The Group recorded an IFRS loss for the year to 31 December 2023 of £1,123,000, or
4.95p/shr (2022: loss
£136,000, or 0.60p/shr). The majority of the losses were associated with the
decline in value of the Company’s HEIQ investment, and losses on hedges, partially
offset by the increase in value (on a mark to market basis) of Dolphin Capital
Advisors (DCI).
Operating income is still substantially below Group target due to continued vacancy
of the former Argos unit in the Company’s Hastings property. Further clouding the
picture was the ongoing problem that we encountered in Hastings with an illegal
occupant who had taken occupancy illegally. The offending party had the temerity to
blame us for not extending them a lease, notwithstanding the fact that they had
moved in without ever applying for a lease. We are pleased to report that they have
since departed.
Refurbishment of the former Argos unit is now complete, and we will now seek to
relet both the Argos unit, and once extended, the end restaurant unit at prevailing
rates, whilst also commencing the refurbishment and conversion of the first floor
from office to residential. Unfortunately, building costs are currently in
Lala-land ,such that finding a builder to work at a reasonable price is somewhat
akin to finding a needle in a haystack.
Key Performance Indicators (“KPI’s”)
Throughout the reporting period the Group had no borrowings and held cash reserves
at 31 December 2023 of
£1.117 million (31 December 2022: £1.721 million). The KPI’s relating to Interest
Cover, Loan to Value and Gearing, shown in previous reports, are therefore no
longer applicable. The Net Asset Value per Share at 31 December 2023 was 21.9p (31
December 2022: 26.9p).
Property Operating Expenses
Property operating expenses for the year to 31 December 2023 were £298,000 (2022:
£300,000). This was predominantly caused by the property rates increases and the
vacancy of a larger floorspace in Hastings. There was a release of bad debt
provision in the comparable period which increases the variance.
Administrative Expenses
Administrative expenses were £743,000 during the year to 31 December 2023 (2022:
£604,000).
Net Asset Value (“NAV”)
The NAV at 31 December 2023 was £4.97 million or 21.9p per share, based on 22.7
million shares in issue, excluding those held in treasury (31 December 2022: £6.10
million, 26.9p per share, based on 22.7 million shares in issues).
At 31 December 2023 the Group held £1.117 million of cash (31 December 2022: £1.721
million). At 31 December 2023 the Group had no banking debt (31 December 2022:
£nil).
At 31 December 2023, investment properties were held at an assessed fair value of
£2,371,000 (2022: £2,504,000). The fair value has been assessed with reference to a
third party valuation performed in 2020. The Board’s assessment of the carrying
value remains unchanged, pending finding new tenants for vacant units.
One residential property in Stafford is considered to be held for sale at 31
December 2023, valued in the Company’s accounts at that date at its anticipated
sale price.
The 2020 external valuation was undertaken in accordance with the Royal Institute
of Chartered Surveyors Appraisal and Valuation Standards on the basis of market
value.. Market value is defined as the estimated amount for which a property should
exchange on the date of valuation between a willing buyer and a willing seller in
an arm’s length transaction, after proper marketing wherein the parties had each
acted knowledgeably, prudently and without compulsion.
Financing
The Group had no borrowings during the year and the Group’s operations were
financed from its property income.
During the reporting period the Group held some of its cash in foreign currencies.
These holdings generated a small unrealised loss at the end of the period,
principally from the reduction in USD value against GBP across the period. The risk
associated with foreign currency holdings is described in Note 16 to the financial
statements.
Dividend
In line with the Group’s current dividend distribution policy no dividend will be
paid in respect of the reporting period. The directors will continue to review the
dividend policy in line with progress with the Group’s investment strategy.
Risk Management & Operational Controls
The directors recognize that commercial activities invariably involve an element of
risk. A number of the risks to which the business is exposed, such as the condition
of the UK domestic economy and sentiment in the UK property market, are beyond the
Company’s influence. However, such risk areas are monitored and appropriate
mitigating action, such as reviewing the substance and timing of the Company’s
operational plans, is taken wherever practicable in response to significant
changes. The directors consider the risk areas the Company is exposed to in the
light of prevailing economic conditions and the risk areas set out in this section
are subject to review.
In relation to asset management, the Company’s approach to risk reflects the
Company’s granular business model and position in the market and involves the
expertise of its directors, management and third-party advisers. Operational
progress and key investment and disposal decisions are considered in regular
management team meetings as well as being subject to informal peer review.
Higher level risks and financial exposures are subject to constant monitoring.
Major investment and disposal decisions are subject to review by the directors in
accordance with a protocol set by the Board.
The Board’s approach in this area is further explained in the Governance section,
under Risk & Internal Control.
Principal Risks and Uncertainties
Rank Potential Risk Impact Mitigation
Property and Investment Portfolio Performance
• Actual and prospective voids and
rental arrears continually
monitored.
• Early identification of /
discussions with tenants in
difficulties
• Tenant • Regular review of all properties
defaults for lease terminations and tenant
• Reduced risk, with early action to take
rental control of units as appropriate
income • Limited requirement for tenant
Effect of downturn in • Increased incentives within sub-sector
1. macroeconomic void costs • Close liaison with local agents
environment • Reduction in enables swift decisions on
Net Asset individual properties
Value and • Tendency of small traders to take
realisation early action in response to
value of economic conditions
assets • Diverse tenant base
• Sustainable location and property
use
• Ensuring positions are sufficiently
hedged to ensure long and short
positions are in place to take
advantage of the market movements
• Income
Higher than insufficient • All material expenditure subject to
anticipated property to cover authorisation regime
2. maintenance or costs • Capital expenditure subject to
improvement / • Decline in regular review
refurbishment costs property
value
• Adverse
impact on • Monitoring of UK property
portfolio environment and regulatory
Changes to legal • Loss of proposals
3. environment, planning development • Close liaison with agents and
law or local planning opportunity advisers
policy • Reduction in • Membership of and dialogue with
realisation relevant industry bodies
value of
assets
• Guidance on regulatory requirements
provided by managing agents and
Failure to comply • Tenant and professional advisers
with regulatory third-party • Individual properties monitored by
requirements in claims asset managers and agents
connection with resulting in • Managing agents operate formal
4. property portfolio, financial regulatory certification process
including health, loss for residential accommodation
safety and • Reputational • Ongoing programme of risk
environmental damage assessments for key multi-tenanted
sites
• Key risks covered by insurance
policies
Corporate Governance & Management
• Impact on
operations
and
Non-availability of reporting
information ability • Provision of effective security
5. technology systems or • Financial regime with automatic off-site data
failure of data claims and systems back- up
security arising from
• leak of
confidential
information
• Insufficient
finance
available at
acceptable
rates to
fulfil
business
plans
• Inability to
execute
investment • The Group is debt-free and debt
Financial and property finance has not been required.
6. property market disposal • Finance risks reduced with
conditions strategy provision of cash reserve
owing to • Impact of interest rates on
fall in property yields monitored
property
market
values
• Financial
impact of
debt
interest
• Breach of
banking
covenants
Operational Controls
During the year, the directors continued to recognize that the Company’s ability to
operate successfully is largely dependent on the maintenance of its straightforward
approach to doing business and its reputation for integrity. All those who act on
the Company’s behalf are required to behave and transact business in accordance
with the highest professional standards. As well as compliance with all relevant
regulatory requirements, this extends to customer care and external complaint
guidelines. The Company has adopted a Code, Policy and Procedures under the Market
Abuse Regulation. The majority of the operations were contracted to Eddisons
Property Management. Eddisons have looked after the property management for
previous years and include the provision of all applicable compliance procedures.
The directors were satisfied that the governance procedures adopted by Eddisons in
relation to its clients were appropriate and protected the Company’s interests. The
Company’s corporate governance regime is underpinned by a whistle-blowing
procedure, enabling perceived irregularities to be notified to members of the
Board, principally the senior independent non-executive director.
The Board has overall responsibility for the Company’s internal control systems and
for monitoring its effectiveness. The Board’s approach is designed to manage rather
than eliminate the risk of failure to achieve business objectives and can only
provide reasonable assurance against material misstatements or loss. The directors
have not considered it appropriate to establish a separate internal audit function,
having regard to the Company’s size. The Board’s approach to internal controls
covers all companies within the Group and there are no associate or joint venture
entities which it does not cover.
The principal foundations of the Company’s internal control framework during the
reporting period were:
• statements of areas of responsibility reserved to the directors, with
prescribed limits to executive authority to commit to expenditure and
borrowing;
• effective committee structure with terms of reference and reporting
arrangements to the Board;
• clear remits for the delegation of executive direction and internal operational
management functions;
• framework for independent directors to provide advice and support to executive
directors on an individual basis;
• top-level risk identification, evaluation and management framework;
• effective systems for recognized capital expenditure and significant revenue
items and monitoring actual cost incurred;
• ongoing reporting to the Board of operational activity and results;
• regular review of operational forecasts and consideration by the directors;
• ongoing reporting to the directors on health, safety and environmental matters.
The Board reviews the effectiveness of the Company’s risk management systems
against the principal risks facing the business and their associated mitigating
factors, taking account of the findings and recommendations of the auditors at the
Company’s half-year and year-end. Following its review of the auditors’ findings
during the reporting period, the Board considers that the Company’s approach
remains effective and appropriate for a business of the Company’s size and
complexity.
Key Contracts
There are currently no contracts which require third party approval for any change
to the nature, constitution, management or ownership of the business. The
appointment agreements of directors do not contain any provisions specifically
relating to a change of control.
Charitable and Political Donations
During the reporting period the Group made £650 donations for charitable purposes
and no donations for political purposes (2022: nil).
Section 172 Companies Act 2006
The Directors acknowledge their duty under s.172 of the Companies Act 2006 and
consider that they have, both individually and together, acted in the way that, in
good faith, would be most likely to promote the success of the Company for the
benefit of its members as a whole. In doing so, they have had regard (amongst other
matters) to:
• the likely consequences of any decision in the long term. The Group’s long-term
investment strategy is shown in the Chairman’s Report, with associated risks
highlighted in the Strategic report.
• the impact of the Group’s operations on the community and the environment. The
Group operates honestly and transparently. We consider the impact on the
environment on our day-to-day operations and how we can recognize this.
• the desirability of the Group maintaining a reputation for high standards of
business conduct. Our intention is to behave in a responsible manner, operating
within the high standard of business conduct and good corporate governance, as
highlighted in the Corporate Governance Statement on page 12.
• the need to act fairly as between members of the Group. Our intention is to
behave responsibly towards our shareholders and treat them fairly and equally
so that they may benefit from the successful delivery of our strategic
objectives.
This Financial Review was approved by the directors on 26 April 2024.
Duncan Soukup, Chairman
29 April 2024
CORPORATE RESPONSIBILITY STATEMENT
During the year we continued to focus on the three principal contributors to the
success of our business:
• the talent and commitment of our executives;
• our relationships with national and local advisers, partners and clients; and
• the well-being of the businesses that occupy our properties and the communities
in which they operate.
The directors remain conscious that the Group’s ability to operate effectively
rests on our reputation for fairness and a straightforward and honest approach to
conducting business. We therefore strive to transact business in accordance with
the highest professional standards and all those who act on our behalf are expected
to do the same. Besides complying with all relevant legislation and professional
guidelines, this includes customer care and external complaint procedures.
We have again considered whether it is appropriate to report on relevant human
rights issues. In the context of our business and the reduced size of our
investment portfolio, we do not believe that the provision of detailed information
in this area would provide any meaningful enhancement to the understanding of the
performance of our business. However, we are confident that our approach to doing
business does not contravene any human rights principles or applicable legislation.
Our approach to corporate responsibility matters is underpinned by a
whistle-blowing procedure, enabling perceived irregularities to be notified to
directors, principally the independent non-executive directors.
DIVERSITY
The Group has a formal diversity and equal opportunities policy in place and is
committed to a culture of equal opportunities for all regardless of age, race or
gender. The Board currently comprises three male directors.
HEALTH, SAFETY AND WELFARE
The directors were responsible for ensuring that the Group discharged its
obligations for health, safety and welfare during the reporting period, including
matters delegated to the Group’s managing agents and other contractors. No material
health, safety and welfare incidents were notified during the period. Our property
managers and contractors continued to be required to ensure that property
management, maintenance and construction activities conform to all relevant
regulations, with due consideration being given to the welfare of occupants and
neighbours.
ANTI-CORRUPTION AND ANTI-BRIBERY
The Company has in place an Anti-Bribery and Anti-Corruption Policy which the
directors consider fulfils UK Government guidelines for compliance with UK Bribery
Act 2010.
GOVERNANCE
REGULATORY COMPLIANCE
The Company is subject to, and seeks to comply with, the Financial Conduct
Authority’s (“FCA”) Listing Rules (“Listing Rules”), the Market Abuse Regulation
and the Disclosure Guidance and Transparency Rules of the Financial Conduct
Authority. The Company is also subject to the UK City Code on Takeovers and
Mergers.
In the prior period the Company adopted the Corporate Governance Code of the Quoted
Companies Alliance (the “QCA Code”). The directors consider that the QCA Code
provides a corporate governance framework proportionate to the risks inherent to
the size and complexity of the Company’s operations. The directors apply the QCA
Code in the ways set out below.
BOARD LEVEL RESPONSIBILITY
The Company’s directors are ultimately responsible for the effective stewardship of
the business, with the Chairman holding specific responsibility for corporate
governance and effective leadership of the Board. In discharging this obligation,
the Chairman regularly consults the Company’s Independent Non-Executive Directors
(who are qualified by background and experience to assist in this sphere), as well
as the Company’s legal advisers and the Company Secretary.
CONFLICTS OF INTEREST
The Company’s Articles of Association provide a framework for directors to report
actual or potential situational conflicts, enabling the Board to give such
situational conflicts appropriate and early consideration. All directors are aware
of the importance of consulting the Company Secretary regarding possible
situational conflicts.
BOARD LEADERSHIP
The Company is led by its Board, which is responsible for determining the strategy
of the business and its effective stewardship. All major strategic and investment
decisions are taken by the Board as a whole, which monitors the resources available
to the Company, to ensure that they are sufficient to enable its goals to be
achieved. The Board meets regularly to review the Company’s operations and progress
with its strategy. The directors are in regular liaison outside formal meetings.
Risk management and controls are reviewed in the light of advice from the external
auditors, who have access to all the directors.
The Board comprises an executive Chairman and two independent non-executive
directors, as set out below.
Duncan Soukup
Executive Chairman, aged 69
Duncan Soukup is the founder and Executive Chairman of Thalassa Holdings Ltd
(“Thalassa”), a company listed on the London Stock Exchange, and has over 35 years
of investment experience. Prior to establishing Thalassa, Mr Soukup worked in
investment banking for 10 years, including as managing director in charge of the
non-US equity business of Bear Sterns. Thereafter, he established the AIM-listed
investment management business Acquisitor plc.
As the executive chairman with a beneficial interest in the Company’s shares, Mr
Soukup is not considered to be independent.
Martyn Porter (Appointed May 2022)
Non-Executive Director, aged 53
Martyn has over 25 years’ experience in international banking and financial
services with the HSBC Group. He has held senior leadership positions in the UK,
Malta, the Philippines, Hong Kong, Vietnam, Luxembourg and latterly Monaco, where
he served as Chief Executive Officer of the HSBC Private Bank and Asset Management
companies. As a board director and regulated officer of HSBC companies in Ireland,
Luxembourg and Monaco, Mr. Porter has significant knowledge and understanding of
corporate governance and regulatory compliance. He also has a highly successful
track record in the leadership of businesses undergoing complex strategic change
and transformation. During his career, Mr. Porter has built a wide and diverse
network of business relationships, as well as demonstrating strong values and
business ethics.
Tim Donell (Appointed February 2022)
Non-Executive Director, aged 42
A certified chartered accountant, Tim has over 15 years’ experience in finance,
accounting and management roles within growth companies across travel, e-commerce
and web technology and has a demonstrated track record of developing and improving
financial processes to drive business performance.
DIVISION OF RESPONSIBILITIES
The responsibilities of each director are set out clearly in the director’s letter
of appointment, which is available for inspection by members of the Company at its
registered office during normal office hours. All directors ensure that they
provide sufficient time to fulfil their obligations. All directors have access to
the advice and services of the Company Secretary and to independent legal advice at
the Company’s expense.
During the reporting period the directors monitored the Company’s operational
progress and the activities of the executive management. The Chairman is
responsible for ensuring that due consideration is given to key items of business
both at formal meetings of the directors and liaison outside these. The independent
non-executive directors provide a separate communication channel for shareholders
and other interested parties and has a remit under the Company’s “whistle-blowing”
arrangements.
Nomination, Audit and Remuneration Committees were in place throughout the
reporting period, with responsibility for specific areas within the Company’s
overall corporate governance structure. During the reporting period there was no
requirement for either of the Remuneration Committee or the Nomination Committee to
meet.
The Board met and held discussions throughout the year. The frequency of the
meetings fluctuated as required. The meetings consisted of discussion to agree
strategy and the handling of the assets. The majority of the meetings were on an
informal and operational basis with the conclusions appropriately documented.
Aside from the meetings described above each director’s attendance record at Board
and Committee meetings during the reporting period is set out in the table below:
Director Board Audit Remuneration Nomination
Duncan Soukup 2 1 n/a n/a
Tim Donell 2 1 n/a n/a
Martyn Porter 2 n/a n/a n/a
Under the Company’s Articles one-third of the directors are subject to retirement
at each Annual General Meeting. Additionally, the Articles require that director
appointments made by the Board directors are ratified at the subsequent General
Meeting of the Company.
Arrangements are made to provide new directors with an induction programme into the
Company’s activities. Non- executive directors also meet with management on an
informal basis. Arrangements are made for directors to inspect investment
properties.
RISK & INTERNAL CONTROL
In addressing its responsibilities in this area, the Board pays particular
attention to:
• monitoring the integrity of the Company’s financial statements and formal
announcements relating to its financial performance and reviewing significant
financial reporting judgements contained in them;
• reviewing the adequacy and effectiveness of the Company’s internal financial
controls, internal control and risk management systems, fraud detection,
regulatory compliance and whistle-blowing arrangements;
• making recommendations for the approval of shareholders on the appointment, re-
engagement or removal of the external Auditors and approving the Auditors’
terms of engagement and remuneration;
• overseeing the Company’s relationship with the external Auditors, reviewing and
monitoring the Auditors’ independence and objectivity and effectiveness;
• approving the annual audit plan and reviewing the Auditors’ findings and the
effectiveness of the audit programme.
The Company’s approach to risk management is set out on pages 9 and 10.
DIRECTORS’ REMUNERATION POLICY AND REMUNERATION IMPLEMENTATION REPORT
There was no requirement for the Remuneration Committee to meet during the
reporting period. The Company had no employee directors during the year and no
share-related incentive schemes were in operation. Although it is not currently
required, the remuneration policy for employee directors recognized below was
approved by shareholders at the annual general meeting held in March 2020:
• within a competitive market, enabling the recruitment and retention of
individuals whose talent matches the entrepreneurial and leadership needs of
the business, enabling the Company to fulfil its investment objectives for its
shareholders; and
• placing emphasis on performance-related rewards and focusing on incentive
targets that are closely aligned with the interests of shareholders.
Base Salary To be pitched at market median for the role, with
advice taken from independent consultants.
Termination Service contracts to be capable of termination at
not more than one year’s notice
Future scheme to be based on the achievement of
profitability and cash generation targets based on
Annual Bonus Scheme the Company’s annual budget.
Individual awards to be capped at 100% of base
salary.
Scheme to be based on the award of shares or cash
equivalent.
Share Based Performance Scheme
Awards to vest on the achievement of medium-term and
long-term targets derived from the Company’s
investment strategy.
Pension Company contribution to individuals’ pension plans
of up to 10% of base salary.
Health Plan Individuals may participate in private healthcare
arrangements supplied by the Company.
In applying the remuneration policy, the Board will use its discretion to provide a
tailored mix of benefits that encourages individuals to maximise their efforts in
the best interests of shareholders. In particular, the remuneration policy would be
subject to any special considerations that may arise in relation to the execution
of any revised investment policy approved by the Company’s shareholders.
NON-EXECUTIVE PAY
The Company’s policy has been to provide remuneration to its non-executive
directors commensurate with the need to attract and retain individuals with levels
of skill and experience appropriate to the Company’s needs. No non-executive
directors have participated in any bonus or share-based arrangements of the
Company.
DIRECTORS’ REMUNERATION
The below table highlighted total directors’ remuneration in the period.
Director Salary Short term Long term Pension Benefits Total
incentives incentives contributions in kind
Duncan 144,213 - - - - 144,213
Soukup
Tim Donell 12,000 12,000
Martyn 20,503 20,503
Porter
Total 176,716 - - - - 176,716
The aggregate directors’ remuneration during the reporting period was £176,716
(2022: £142,391). Of Martyn Porter’s 2023 remuneration, £7,032 related to 2022 and
was under-accrued at 2022 year-end.
DIRECTORS’ SERVICE CONTRACTS
Non-executive directors Date of initial appointment Date of current appointment
letter
Duncan Soukup 4 October 2019 27 February 2021
Tim Donell 7 February 2022 21 October 2022
Martyn Porter 20 May 2022 20 May 2022
DIRECTORS’ INTERESTS IN THE COMPANY’S SHARES (AUDITED)
The interests during the reporting period of the directors who held office during
the reporting period in the issued share capital of the Company as at the date of
this report are set out below:
Ordinary 1p Shares*
Director 2023 2022
Duncan Soukup 5,418,857 5,418,857
Tim Donell - -
Martyn Porter - -
In addition to the direct interest shown above, Duncan Soukup has an indirect
interest in 4,618,001 and 1,734 Ordinary Shares arising from his interests in
entities of Thalassa Discretionary Trust, and Thalassa Holdings Ltd.
DIRECTORS’ INDEMNITIES AND INSURANCE COVER
To the extent permitted by law, the Company indemnifies its directors and officers
against claims arising from their acts and omissions related to their office. The
Company also maintains an insurance policy in respect of claims against directors.
AUDIT COMMITTEE REPORT
The Audit Committee, consisted of the independent non-executive directors. The key
functions of the audit committee are for monitoring the quality of internal
controls and ensuring that the financial performance of the Group is properly
measured and reported on and for reviewing reports from the Company’s auditors
relating to the Company’s accounting and internal controls, in all cases having due
regard to the interests of Shareholders. The Committee has formal terms of
reference.
The financial statements attached to this report have been prepared on the Going
Concern basis. In deciding that the Going Concern basis is appropriate, the
directors reviewed projections of future activity over the 12 months following the
date of this report. The Directors concluded that there were no identifiable
material uncertainties, and present cash reserves were sufficient to meet all
liabilities as they fall due, up to and beyond that date.
The Committee considered the following items:
• ensuring that the format of the financial statements and the information
supplied meets the standards set by the International Accounting Standards
Board;
• reviewing the accounting treatment of receivables and ensuring effective
co-ordination between the Company’s records and those of its managing agents;
• ensuring that the audit scope properly reflected the risk profile of the
business;
• ensuring that the Committee’s terms of reference continued to accord with
regulatory requirements.
The Committee considered the independence of external auditors, seeking to ensure
that any non-audit services provided, by external auditors do not impair the
auditors’ objectivity or independence. The Company’s auditors, RPG Crouch Chapman,
did not supply any non-audit services to the Company during the period.
Having assessed the performance, objectivity and independence of the auditors, as
well as the audit process and approach taken, the Committee recommended the
re-appointment RPG Crouch Chapman at the Company’s annual general meeting in 2024.
Duncan Soukup
Chairman 29 April 2024
The directors of Alina Holdings Plc (“the Company”) present their report and the
audited financial statements of the Company together with its subsidiaries and
associated undertakings (“the Group”) for the year ended 31 December 2023.
The following directors held office during the reporting period:
Duncan Soukup (appointed 4 October 2019)
Tim Donell (appointed 7 February 2022)
Martyn Porter (appointed 20 May 2022)
The Directors’ Report also includes the information set out on pages 5 to 22,
together with the description of the Company’s investment policy and business model
described on page 5.
GROUP RESULT AND DIVIDEND
The loss for the Group attributable to shareholders for the period was £1,123,000
(2022: loss £136,000). In accordance with the investment policy, no dividend has
been or will be distributed in respect of the financial year. The directors
continue to keep the dividend distribution policy under review.
POST BALANCE SHEET EVENTS
• Sale of Stafford property classified as an asset held for sale at the year-end
(see note 10);
• Settlement of legal action against The Italian Way, a tenant in Hastings, for
breach of lease covenants.
GOING CONCERN BASIS
The financial statements attached to this report have been prepared on the Going
Concern basis. In deciding that the Going Concern basis is appropriate, the
directors reviewed projections of future activity over the 12 months following the
date of this report. The Directors concluded that there were no identifiable
material uncertainties, and present cash reserves were sufficient to meet all
liabilities as they fall due, up to and beyond that date.
SHARE CAPITAL
Details of the Company’s issued share capital are set out in note 17 to the
financial statements. All of the Company’s issued shares are listed on the London
Stock Exchange. The Company’s share capital comprises one class of Ordinary Shares
of 1p each. All issued shares are fully paid up and rank equally and there are no
restrictions on the transfer of shares or the size of holdings. The directors are
not aware of any agreements between shareholders in relation to the Company’s
shares.
SUBSTANTIAL INTERESTS
As at 24 April 2023, the last practicable reporting date before the production of
this document, the Company’s share register showed the following major interests
(of 3% or more, excluding shares held in treasury) in its issued share capital:
Shareholder Ordinary Shares %
Vidacos Nominees Limited* 10,036,857 44.22
HSBC Global Custody Nominee (UK) Limited** 6,718,785 29.60
Ferlim Nominees Limited 1,200,000 5.29
* Included within Vidacos Nominees Limited are shares of 5,418,857 owned by C D
Soukup and 4,618,001 held by Thalassa Discretionary Trust.
** The Company has also been notified that 6,391,223 (28.16%) shares are
beneficially owned by Peter Gyllenhammar AB.
INVESTOR RELATIONS
Subject to regulatory constraints, the directors are keen to engage with the
Company’s shareholders, placing considerable emphasis on effective communications
with the Company’s investors. Directors are happy to comply with shareholder
requests for meetings as soon as practicable, subject to regulatory constraints.
The Board is provided with feedback on such meetings, as well as regular commentary
from investors and the Company’s bankers and advisers. The Board provides reports
and other announcements via the regulatory news service in accordance with
regulatory requirements. Regulatory announcements and key publications can also be
accessed via the Company’s website. The Company’s Annual General Meeting provides a
further forum for investors to discuss the Company’s progress. The Company complies
with relevant regulatory requirements in relation to convening the meeting, its
conduct and the announcement of voting on resolutions. The Annual Report and Notice
of the Annual General Meeting are made available to shareholders at least 21
working days prior to the meeting and are available on the Company’s website. The
results of resolutions considered at the Annual General Meeting are announced to
the Stock Exchange and are also published on the website and lodged with the
National Storage Mechanism. Investors may elect to receive communications from the
Company in electronic form and be advised by email that communications may be
accessed via the Company’s website.
WHISTLEBLOWING POLICY
The Group has in place a whistleblowing policy which sets out the formal process by
which an employee of the Group may in confidence raise concerns about possible
improprieties in the Group’s affairs, including financial reporting.
ESG
The Group has not complied with the recommendations of the Taskforce for
Climate-related Financial Disclosures (“TCFD”) in the current year, as required by
LR14.3.27R issued by the Financial Conduct Authority. The Board recognises the
importance of climate-related matters and, as a relatively small development stage
property business, intends to develop a plan to adopt the TCFD recommendations in
full over the next few years. With reference to the four pillars of the TCFD
recommendations, matters of governance, risk assessment, and strategy are covered
in this report, and the further development of metrics and targets is under
consideration.
We have always believed that our local asset model is by its nature supportive of
reducing the carbon impact of retail shopping. Our past development activity has
been aimed at returning to profitable use redundant space that would otherwise
remain vacant, potentially relieving development pressure on greenfield sites
elsewhere. Any development activity undertaken is carried out in accordance with
applicable energy and resource saving standards, noise impact reduction
requirements, and, where relevant, the need to preserve the character of buildings,
including listed properties. Our contractors are required to dispose of waste in
accordance with best practice. We continue to take action to upgrade the energy
performance of our letting units wherever required.
It is our policy to seek to deal constructively with all stakeholders in relation
to any community issues that arise in relation to our properties. Our policy is to
prefer to use local advisers, agents and contractors whenever appropriate to do so.
It is our intention to review our response to environmental, social and governance
factors in line with the development of our investment policy to ensure that our
policies are appropriate to the revised strategy and operational profile. This
review will take account of related issues, such as modern slavery.
EMISSIONS AND ENERGY CONSUMPTION REPORTING
The directors believe that the Company’s outsourced business model, which focusses
on the employment of agents, advisers and contractors who are local to our property
assets, is inherently environmentally friendly. However, the collection of
consumption data from such businesses is not practicable. It is also not possible
for our national agents and advisers to separately identify such data in relation
to the proportion of their work devoted to the Company’s activities, particularly
given the increase in staff working from home during the COVID-19 lockdown. It is
not possible to measure the energy consumed by the Company’s tenants (nor is this
consumption within the Company’s control). The consumption of water, waste output
and greenhouse gases other than CO2 within the Company’s control is negligible.
For previous reporting periods the Company has supplied environmental reporting
information focused on energy consumed by the Company and its wholly owned
subsidiaries through the activities of its office base, shared facilities provided
by the Company within its property portfolio and activities within vacant
properties within the Company’s control.
In relation to Scope 1 Carbon Emissions (consumption of gas and fuel), since the
termination of the Company’s third-party investment advisory agreement and the
relocation of its registered office it has not been possible to separately identify
the energy consumed on the Company’s activities. An element of the Company’s
administration activity is carried out at its registered office. However, this is a
de minimis element of the overall activity and energy consumption at that site.
Other activity is undertaken by the Company’s directors and management working at
home. In both cases, it has not been possible to separately identify the energy
consumed on the Company’s activities at those locations. In previous years, data
has been supplied relating to fuel consumed on journeys on Company activities. As
the Company does not operate company cars, all such journeys are made in employees’
private vehicles or on public transport. The reduction in the Company’s property
portfolio has significantly reduced the requirement for such journeys, which were
then further restricted during the reporting period by the COVID-19 lockdown
regime. Accordingly, the directors do not consider that any meaningful Scope 1 data
can be supplied.
Similar limitations apply to Scope 2 data, which in previous reports comprised an
estimate of consumption for vacant property units for which the Company is
responsible. The number of these and the related energy consumption has been de
minimis throughout the reporting period. Similarly, it has not been practicable to
measure Scope 3 emissions.
The Company’s direct usage and emissions of water is also minimal. Although a small
element of utility supply charges within vacant premises relate to water and to
gas, this largely relates to standing charges and consumption is negligible.
In relation to The Companies (Directors’ Report) and LLP Partnerships (Energy and
Carbon Report) Regulations 2018, the Company consumes less than 40,000 kWh of
energy per annum and therefore qualifies as a low energy user and therefore does
not come within the scope of those regulations.
STATEMENT OF DISCLOSURE TO AUDITORS
The directors who were in office at the date of the approval of the financial
statements have confirmed that, as far as they are aware, there is no relevant
audit information of which the auditors are unaware. Each of the directors has
confirmed that they have taken all necessary steps that they ought to have taken as
directors in order to make themselves aware of any relevant audit information and
to establish that this has been communicated with the auditors.
This report was approved by the directors on 26 April 2024
Alasdair Johnston
Company Secretary
STATEMENT OF 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 UK Adopted International Accounting
Standards and applicable law and have elected to prepare the parent Company
financial statements in accordance with UK accounting standards, including FRS 102
The Financial Reporting Standard applicable in the UK.
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 their 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, reliable and
prudent;
• for the Group financial statements, state whether they have been prepared in
accordance with UK Adopted International Accounting Standards;
• 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 parent company 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 Responsibility 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.
RESPONSIBILITY STATEMENT OF THE DIRECTORS IN RESPECT OF THE ANNUAL FINANCIAL
REPORT
We confirm that to the best of our knowledge:
• the financial statements, prepared in accordance with the applicable set of
accounting standards, give a true and fair view of the assets, liabilities,
financial position and profit or loss of the company and the undertakings
included in the consolidation taken as a whole; and
• the strategic report/directors’ report includes a fair review of the
development and performance of the business and the position of the issuer and
the undertakings included in the consolidation taken as a whole, together with
a description of the principal risks and uncertainties that they face.
We consider the annual report and accounts, taken as a whole, is fair, balanced and
understandable and provides the information necessary for shareholders to assess
the group’s position and performance, business model and strategy.
The foregoing reports were approved by the directors on 26 April 2024
Duncan Soukup
Chairman
INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS OF ALINA HOLDINGS PLC
OPINION
We have audited the financial statements of Alina Holdings Plc (the ‘Company’) and
its subsidiaries (the ‘Group’) for the year ended 31 December 2023 which comprise
the Consolidated Statement of Income, Consolidated Statement of Comprehensive
Income, Consolidated Statement of Financial Position, Consolidated Statement of
Cash Flows, Consolidated Statement of Changes in Equity, Company Balance Sheet ,
and notes to the financial statements, including a summary of significant
accounting policies. The financial reporting framework that has been applied in
their preparation is applicable law and International Financial Reporting Standards
as adopted in the United Kingdom (IFRS) for the Group and UK accounting standards,
including FRS 102 The Financial Reporting Standard applicable in the UK (UK GAAP).
In our opinion, the financial statements:
• give a true and fair view of the state of the Group’s and of the Company’s
affairs as at 31 December 2023 and of the Group’s loss for the year then ended;
• have been properly prepared in accordance with IFRS for the Group, and UK GAAP
for the Company; 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 under those standards are
further described in the Auditor’s responsibilities for the audit of the financial
statements section of our report. We are independent of the group in accordance
with the ethical requirements that are relevant to our audit of the financial
statements in the UK, including the FRC’s Ethical Standard as applied to listed
entities, and we have fulfilled our other ethical responsibilities in accordance
with these requirements. We believe that the audit evidence we have obtained is
sufficient and appropriate to provide a basis for our opinion.
CONCLUSIONS RELATING TO GOING CONCERN
In auditing the financial statements, we have concluded that the directors’ use of
the going concern basis of accounting in the preparation of the financial
statements is appropriate.
Our evaluation of the Directors’ assessment of the entity’s ability to continue to
adopt the going concern basis of accounting included review of the expected
cashflows for a period of 18 months from the balance sheet date compared with the
liquid assets held by the Group.
Based on the work we have performed, we have not identified any material
uncertainties relating to events or conditions that, individually or collectively,
may cast significant doubt on the Group’s or the Company’s ability to continue as a
going concern for a period of at least twelve months from when the financial
statements are recognized for issue.
Our responsibilities and the responsibilities of the directors with respect to
going concern are described in the relevant sections of this report.
OUR APPROACH TO THE AUDIT
In planning our audit, we determined materiality and assessed the risks of material
misstatement in the financial statements. In particular, we looked at where the
directors made subjective judgements, for example in respect of significant
accounting estimates. As in all of our audits, we also addressed the risk of
management override of internal controls, including evaluating whether there was
evidence of bias by the directors that represented a risk of material misstatement
due to fraud.
We tailored the scope of our audit to ensure that we performed sufficient work to
be able to issue an opinion on the financial statements as a whole, taking into
account the structure of the group and the parent company, the accounting processes
and controls, and the industry in which they operate.
We performed the audits of the Company and its subsidiaries.
KEY AUDIT MATTERS
Key audit matters are those matters that, in our professional judgement, were of
most significance in our audit of the financial statements of the current period
and include the most significant assessed risks of material misstatement we
identified (whether or not due to fraud), 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. The matter identified was
addressed in the context of our audit of the financial statements as a whole, and
in forming our opinion thereon, and we do not provide a separate opinion on these
matters.
Key audit matter How our work addressed this matter
Carrying value of property
The Group held £2.5m (2022:
£3.3m) of properties, Our work included:
including £0.1m (2022:
£0.8m) of properties held • Reviewing the recognition and fair value
for sale. measurement of investment properties in accordance
with IAS 40 Investment Property and IFRS13 Fair
Investment properties are Value Measurement;
held at fair value, which • Agreeing assumed rates of rent per square foot to
represents a significant are actual rates achieved in adjacent units;
of management judgement. • Reviewing management estimates for occupancy and
Properties held for sale are timing of renovation works;
held at net recognised • Reviewing management’s assessment of the range of
value. values for property held for development; and
• Reviewing sales and associated costs subsequent to
Given the subjectivity of the balance sheet date.
estimates involved, we
consider the carrying value
of property to be a key
audit matter.
Carrying value of investment
in subsidiaries
The Company held £3.0m
(2022: £3.1m) of investments
in subsidiaries.
Our work included:
The directors are required
to review the carrying value • Reviewing the underlying valuation of assets held
of investments for by subsidiaries; and
impairment annually. • Reviewing rental yields calculated by management.
Given the subjective nature
of the related estimates and
judgements, we consider the
carrying value of available
for sale investments to be a
key audit matter.
OUR APPLICATION OF MATERIALITY
We apply the concept of materiality both in planning and performing our audit, and
in evaluating the effect of misstatements. We consider materiality to be the
magnitude by which misstatements, including omissions, could influence the economic
decisions of reasonable users that are taken on the basis of the financial
statements.
In order to reduce to an appropriately low level the probability that any
misstatements exceed materiality, we use a lower materiality level, performance
materiality, to determine the extent of testing needed. Importantly, misstatements
below these levels will not necessarily be evaluated as immaterial as we also take
account of the nature of identified misstatements, and the particular circumstances
of their occurrence, when evaluating their effect on the financial statements as a
whole.
We consider gross assets to be the most significant determinant of the Group’s
financial performance used by the users of the financial statements. We have based
materiality on 1.5% of gross assets for each of the operating components. Overall
materiality for the Group was therefore set at £0.1m. For each component, the
materiality set was lower than the overall group materiality.
We agreed with the Audit Committee that we would report on all differences in
excess of 5% of materiality relating to the Group financial statements. We also
report to the Audit Committee on financial statement disclosure matters identified
when assessing the overall consistency and presentation of the consolidated
financial statements.
OTHER INFORMATION
The directors are responsible for the other information. The other information
comprises the information included in the annual report, other than the financial
statements and our auditor’s report thereon. Our opinion on the financial
statements does not cover the other information and, except to the extent otherwise
explicitly stated in our report, we do not express any form of assurance conclusion
thereon. In connection with our audit of the financial statements, our
responsibility is to read the other information and, in doing so, consider whether
the other information is materially inconsistent with the financial statements or
our knowledge obtained in the audit or otherwise appears to be materially
misstated. If we identify such material inconsistencies or apparent material
misstatements, we are required to determine whether there is a material
misstatement in the financial statements or a material misstatement of the other
information. If, based on the work we have performed, we conclude that there is a
material misstatement of this other Information, we are required to report that
fact. We have nothing to report in this regard.
OPINIONS ON OTHER MATTERS PRESCRIBED BY THE COMPANIES ACT 2006
In our opinion, based on the work undertaken in the course of the audit:
• the information given in the strategic report and the directors’ report for the
financial year for which the financial statements are prepared is consistent
with the financial statements; and
• the strategic report and the directors’ report have been prepared in accordance
with applicable legal requirements.
MATTERS ON WHICH WE ARE REQUIRED TO REPORT BY EXCEPTION
In the light of the knowledge and understanding of the group and the parent company
and its environment obtained in the course of the audit, we have not identified
material misstatements in the strategic report or the directors’ report.
We have nothing to report in respect of the following matters in relation to which
the Companies Act 2006 requires us to report to you if, in our opinion:
• adequate accounting records have not been kept by the parent company, or
returns adequate for our audit have not been received from branches not visited
by us; or
• the parent company financial statements are not in agreement with the
accounting records and returns; or
• certain disclosures of directors’ remuneration specified by law are not made;
or
• we have not received all the information and explanations we require for our
audit.
RESPONSIBILITIES OF DIRECTORS
As explained more fully in the directors’ responsibilities statement set out on
page 25 the directors are responsible for the preparation of the financial
statements and for being satisfied that they give a true and fair view, and for
such internal control as the directors determine is necessary to enable the
preparation of financial statements that are free from material misstatement,
whether due to fraud or error.
In preparing the financial statements, the directors are responsible for assessing
the group’s and the parent company’s ability to continue as a going concern,
disclosing, as applicable, matters related to going concern and using the going
concern basis of accounting unless the directors either intend to liquidate the
group or the parent company or to cease operations, or have no realistic
alternative but to do so.
Those charged with governance are responsible for overseeing the Company’s
financial reporting process.
AUDITOR’S RESPONSIBILITIES FOR THE AUDIT OF THE FINANCIAL STATEMENTS
Our objectives are to obtain reasonable assurance about whether the financial
statements as a whole are free from material misstatement, whether due to fraud or
error, and to issue 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 financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and
regulations. We design procedures in line with our responsibilities, outlined
above, to detect material misstatements in respect of irregularities, including
fraud. The extent to which our procedures are capable of detecting irregularities,
including fraud, is detailed below:
• We obtained an understanding of the legal and regulatory frameworks within
which the Group operates focusing on those laws and regulations that have a
direct effect on the determination of material amounts and disclosures in the
financial statements.
• We identified the greatest risk of material impact on the financial statements
from irregularities, including fraud, to be the override of controls by
management. Our audit procedures to respond to these risks included enquiries
of management about their own identification and assessment of the risks of
irregularities, sample testing on the posting of journals and reviewing
accounting estimates for biases.
Because of the inherent limitations of an audit, there is a risk that we will not
detect all irregularities, including those leading to a material misstatement in
the financial statements or non-compliance with regulation. This risk increases the
more that compliance with a law or regulation is removed from the events and
transactions reflected in the financial statements, as we will be less likely to
become aware of instances of non-compliance. The risk is also greater regarding
irregularities occurring due to fraud rather than error, as fraud involves
intentional concealment, forgery, collusion, omission or misrepresentation.
A further description of our responsibilities for the audit of the financial
statements is located on the Financial Reporting Council’s website at:
2 www.frc.org.uk/auditorsresponsibilities.This description forms part of our
Auditor’s Report.
OTHER MATTERS THAT WE ARE REQUIRED TO ADDRESS
We were appointed on 12 April 2023 and this is the second year of our engagement as
auditors for the Group.
We confirm that we are independent of the Group and have not provided any
prohibited non-audit services, as defined by the Ethical Standard issued by the
Financial Reporting Council.
Our audit report is consistent with our additional report to the Audit Committee
explaining the results of our audit.
USE OF OUR REPORT
This report is made solely to the company’s members, as a body, in accordance with
Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken
so that we might state to the company’s members those matters we are required to
state to them in an auditor’s report and for no other purpose. To the fullest
extent permitted by law, we do not accept or assume responsibility to anyone other
than the company and the company’s members, as a body, for our audit work, for this
report, or for the opinions we have formed.
Paul Randal FCA
(Senior Statutory Auditor)
For and on behalf of
RPG Crouch Chapman LLP Chartered Accountants Registered Auditor
40 Gracechurch Street London
EC3V 0BT
29 April 2024
CONSOLIDATED STATEMENT OF INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
Year ended Year ended
31 December 31 December
2023 2022
Note £000 £000
Gross rental income 305 351
Property operating expenses 4 (298) (300)
Net rental income 7 51
Profit/Loss on disposal of investment properties 5 (73) 4
Gain from change in fair value of investment 10 - 563
properties
Administrative expenses including non-recurring items 6 (743) (604)
Operating loss before net financing costs (809) 14
Depreciation 7 (3) (3)
Financing income 7 21 318
Financing expenses 7 (344) (470)
Share of profits of associated entities 22 12 5
Loss before tax (1,123) (136)
Taxation - -
Loss for the period from continuing operations (1,123) (136)
Loss for the year (1,123) (136)
Attributable to:
Equity shareholders of the parent (1,123) (136)
Non-controlling interest - -
(1,123) (136)
Earnings per share – GBP pence
(using weighted average number of shares)
Basic and Diluted – GBP pence 9 (4.95) (0.60)
The notes on pages 33 to 49 form an integral part of this consolidated interim
financial information.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
Year ended Year ended
31 December 31 December
2023 2022
£000 £000
(1,123) (136)
Loss for the financial year Other comprehensive income:
- -
Total comprehensive income (1,123) (136)
Attributable to:
Equity shareholders of the parent (1,123) (136)
Non-Controlling interest - -
Total Comprehensive income (1,123) (136)
The notes on pages 33 to 49 form an integral part of this consolidated interim
financial information.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2023
As at 31 December As at 31 December
2023 2022
Note £000 £000
Assets
Non-current assets
Investment properties 10 2,371 2,504
Investments in associated entities 22 17 5
Total non-current assets 2,388 2,509
Current assets
Investment property held for sale 10 130 800
Available for sale financial assets 11 2,013 1,749
Trade and other receivables 12 367 233
Cash and cash equivalents 13 1,117 1,721
Total current assets 3,627 4,503
Liabilities Current liabilities
Trade and other payables
14 718 591
Total current liabilities 718 591
Net current assets 2,909 3,912
Non-current liabilities
Finance lease liabilities 323 324
Total non-current liabilities 323 324
Net assets 4,974 6,097
Shareholders’ Equity
Share capital 20 319 319
Capital redemption reserve 20 598 598
Retained earnings 4,057 5,180
Total shareholders’ equity 4,974 6,097
The notes on pages 33 to 49 form an integral part of this consolidated interim
financial information. These financial statements were approved by the board on 29
April 2024.
Signed on behalf of the board by:
Duncan Soukup
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023
Year ended Year ended
31 December 31 December
2023 2022
Note £000 £000
Cash flows from operating activities
Operating Profit/(Loss) for the year before financing (809) 14
Gain from change in fair value of investment 10 - (563)
properties
(Profit)/Loss from change in fair value of head leases (3) (3)
(Profit)/Loss on disposal of investment properties 73 (4)
Decrease/(Increase) in trade and other receivables 12 (134) 22
(Decrease)/Increase in trade and other payables 14 126 164
Loss on foreign exchange (18) 126
Lease liability interest (23) (23)
Interest received 18 1
Interest paid (5) (19)
Profit from change in fair value of investments held 3 191
for sale
Cash generated by operations (772) (94)
Taxation - -
Net cash flow from operating activities (772) (94)
Purchase of investments held for sale (562) (358)
Net Proceeds from sale of investment properties 727 403
Net cash flow in investing activities 165 45
Cash flows from financing activities
(Increase)/reduction on head lease liabilities 15 3 3
Net cash flow from financing activities – continuing 3 3
operations
Net increase in cash and cash equivalents (604) (46)
Cash and cash equivalents at the start of the year 1,721 1,767
Cash and cash equivalents at the end of the year 1,117 1,721
Prior year comparatives have been reclassified to conform to the current year
presentation.
The notes on pages 33 to 49 form an integral part of this consolidated interim
financial information.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
Capital
Share Redemption Retained
Capital Earnings
Reserves
Reserves Total
£000 £000 £000 £000 £000
Balance as at 31 December 2021 319 - 598 5,316 6,233
Total comprehensive income for the - (136) (136)
year
Balance as at 31 December 2022 319 - 598 5,180 6,097
Total comprehensive income for the - - - (1,123) (1,123)
year
Balance as at 31 December 2023 319 - 598 4,057 4,974
The notes on pages 33 to 49 form an integral part of this consolidated interim
financial information.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1 GENERAL INFORMATION
Alina Holdings PLC (“Alina” or the “Company”) is a company registered on the Main
Market of the London Stock Exchange. It is incorporated, domiciled and registered
in England. The Company’s registered number is 05304743 and the address of its
registered office is Eastleigh Court, Bishopstrow, Warminster, BA12 9HW
2 SIGNIFICANT ACCOUNTING POLICIES
The Group prepares its accounts in accordance with applicable UK Adopted
International Accounting Standards.
The group financial statements consolidate those of the Company and its
subsidiaries (together referred to as the “Group”). The parent company financial
statements present information about the Company as a separate entity and not about
its group.
The accounting policies set out below have, unless otherwise stated, been applied
consistently to all periods presented in these group financial statements.
Judgements made by the directors, in the application of these accounting policies
that have significant effect on the financial statements and estimates with a
significant risk of material adjustment in the next year are discussed later in
this note under the heading “Use of Estimates and Judgements”.
The financial statements are prepared in pounds sterling. They have been prepared
under the historical cost convention except for the following assets which are
measured on the basis of fair value: investment properties, investment properties
held for sale and available for sale financial assets.
2.1 SEGMENTAL REPORTING
IFRS 8 requires operating segments to be identified on the basis of internal
reports that are regularly reported to the chief operating decision maker to
allocate resources to the segments and to assess their performance. Since the
strategy review in July 2013 the Group has identified one operation and one
reporting segment, being rental income in the UK, which is reported to the Board of
directors on a quarterly basis. The Board of directors is considered to be the
chief operating decision maker.
2.2 BASIS OF PREPARATION
The consolidated financial statements include the financial statements of the
Company and all its subsidiary undertakings up to 31 December 2023. Subsidiaries
are entities controlled by the Group. The Group controls an 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. In
assessing control, the Group takes into consideration potential voting rights. The
acquisition date is the date on which control is transferred to the acquirer. The
financial statements of subsidiaries are included in the consolidated financial
statements from the date that control commences until the date that control ceases.
The financial statements of subsidiaries are prepared using consistent accounting
policies. Inter-company transactions and balances are eliminated in full on
consolidation.
2.3 GOING CONCERN
The financial information has been prepared on the going concern basis as
management consider that the Group has sufficient cash to fund its current
commitments for the foreseeable future.
2.4 INVESTMENT PROPERTIES
Investment properties are those properties owned by the Group that are held to earn
rental income or for capital appreciation or both and are not occupied by the
Company or any of its subsidiaries.
During 2023 the Company sold a property for £727k net of fees (book value £800k).
Since the Balance Sheet date, one property in Stafford has been sold.
A full external valuation of the Group’s property portfolio was performed in 2020
in accordance with the the Royal Institute of Chartered Surveyors Appraisal and
Valuation Standards on the basis of market value. For the year ended 31 December
2023 the fair value has been assessed with reference to a third party valuation
performed in 2020. The Board’s assessment of the carrying value remains unchanged,
pending finding new tenants for vacant units.
The Company’s objective is still to liquidate the current portfolio of property
assets, which currently show a Gross Initial Yield of 15%, but as and when a sale
can achieve a sensible return to shareholders.
The Directors obtained pricing and yields of similar transactions made within the
accounting period and compared them to the Gross Initial Yield stated above. In all
cases the transactions that were measured came in at a lower value than that
currently being achieved. As stated, although the data is below the Yield being
achieved it was felt prudent to leave the valuations as they stand.
Investment properties are treated as acquired at the point the Group assumes the
significant risks and returns of ownership. Subsequent expenditure is charged to
the asset’s carrying value only when it is probable that future economic benefits
associated with the expenditure will flow to the Group and the cost of each item
can be reliably measured. All other repairs and maintenance costs are charged to
the Income Statement during the period in which they are incurred.
Rental income from investment properties is accounted for as described below.
2.5 INVESTMENT PROPERTIES HELD FOR SALE
Investment properties held for sale are included in the Balance Sheet at their fair
value less estimated sales costs. In determining whether assets no longer meet the
investment criteria of the Group, consideration has been given to the conditions
required under IFRS 5.
An investment property is classified as an asset as held for sale if its carrying
amount will be recovered principally through a sale transaction rather than through
continuing use.
The asset must be available for immediate sale in its present condition subject
only to terms that are usual and customary for sales of such assets and its sale
must be highly probable as at the year end.
2.6 HEAD LEASES
Where a property is held under a head lease and is classified as an investment
property, it is initially recognized as an asset based on the sum of the premium
paid on acquisition and if the remaining life of the lease at the date of
acquisition is considered to be material, the net present value of the minimum
ground rent payments. The corresponding rent liability to the leaseholder was
included in the Balance Sheet as a finance obligation in current and non-current
liabilities.
The payment of head rents has been expensed through the Income Statement.
2.7 TRADE AND OTHER RECEIVABLES
Trade and other receivables are initially recognized at fair value and subsequently
held at amortised cost less impairment. Impairment is made where it is established
that there is objective evidence that the Group will not be able to collect all
amounts due according to the original terms of the receivable. The impairment is
recorded in the Income Statement.
2.8 CASH AND CASH EQUIVALENTS
Cash and cash equivalents comprise cash balances and deposits held on call. Cash
equivalents are short-term, highly liquid investments with original maturities of
three months or less.
2.9 FINANCIAL ASSETS
Financial assets are impaired when there is objective evidence that the cash flows
from the financial asset are reduced.
2.10 FINANCIAL INSTRUMENTS
Financial assets and financial liabilities are initially classified as measured at
amortised cost, fair value through other comprehensive income, or fair value
through profit and loss when the Company becomes a party to the contractual
provisions of the instrument. Financial assets are recognized when the contractual
rights to the cash flows expire, or the Company no longer retains the significant
risks or rewards of ownership of the financial asset. Financial liabilities are
recognized when the obligation is discharged, cancelled or expires.
Financial assets are classified dependent on the Company’s business model for
managing the financial and the cash flow characteristics of the asset. Financial
liabilities are classified and measured at amortised cost except for trading
liabilities, or where designated at original recognition to achieve more relevant
presentation. The Company classifies its financial assets and liabilities into the
following categories:
Financial assets at amortised cost
The Company’s financial assets at amortised cost comprise trade and other
receivables. These represent debt instruments with fixed or determinable payments
that represent principal or interest and where the intention is to hold to collect
these contractual cash flows. They are initially recognized at fair value, included
in current and non-current assets, depending on the nature of the transaction, and
are subsequently measured at amortised cost using the effective interest method
less any provision for impairment.
Impairment of trade and other receivables
In accordance with IFRS 9 an expected loss provisioning model is used to calculate
an impairment provision. We have implemented the IFRS 9 simplified approach to
measuring expected credit losses arising from trade and other receivables, being a
lifetime expected credit loss. This is calculated based on an evaluation of our
historic experience plus an adjustment based on our judgement of whether this
historic experience is likely reflective of our view of the future at the balance
sheet date. In the previous year the incurred loss model is used to calculate the
impairment provision.
Financial liabilities at amortised cost
Financial liabilities at amortised cost comprise loan liabilities, including
convertible loan note liability elements, and trade and other payables. They are
classified as current and non- current liabilities depending on the nature of the
transaction, are subsequently measured at amortised cost using the effective
interest method. All convertible loan notes are held at amortised cost and no
election has been made to hold them as fair value through profit and loss.
Financial assets at fair value through profit and loss
Financial assets at fair value are recognized and measured at fair value using the
most recent available market price with gains and losses recognized immediately in
the profit and loss.
The fair value measurement of the Company’s financial and non-financial assets and
liabilities recognize market observable inputs and data as far as possible. Inputs
used in determining fair value measurements are recognized into different levels
based on how observable the inputs used in the valuation technique are (the ‘fair
value hierarchy’).
Level 1 – Quoted prices in active markets
Level 2 – Observable direct or indirect inputs other than Level 1 inputs Level 3 –
Inputs that are not based on observable market data
2.11 TRADE AND OTHER PAYABLES
Trade and other payables are initially recognized at fair value and subsequently
held at amortised cost.
2.12 ORDINARY SHARE CAPITAL
External costs directly attributable to the issue of new shares are shown in equity
as a deduction from the proceeds.
Shares which have been repurchased are classified as treasury shares and shown in
retained earnings. They are recognized at the trade date for the amount of
consideration paid, together with directly attributable costs. This is presented as
a deduction from total equity. Shares held by the Employee Benefit Trust are
treated as being those of the Group until such time as they are distributed to
employees, when they are expensed in the profit and loss account.
The nominal value of shares cancelled has been taken to a capital redemption
reserve.
2.13 RENTAL INCOME
Rental income from investment properties leased out under operating leases is
recognized in the Income Statement on a straight-line basis over the term of the
lease. When the Group provides lease incentives to its tenants the cost of
incentives are recognized over the lease term, on a straight-line basis, as a
reduction to income.
2.14 TAXATION
Corporation tax on the profit or loss for the year comprises current and deferred
tax. Corporation tax is recognized in the Income Statement except to the extent
that it relates to items recognized directly in equity, in which case it is
recognized in equity.
Current tax is the expected tax payable on the taxable income for the year, using
tax rates enacted or substantively enacted at the balance sheet date and any
adjustment to tax payable in respect of previous years. Deferred tax is provided
using the balance sheet liability method. Provision is made for temporary
differences between the carrying amounts of assets and liabilities in the financial
statements for financial reporting purposes and the amounts used for taxation
purposes. Deferred income tax is calculated after taking account of any indexation
allowances and capital losses on an undiscounted basis. The amount of deferred tax
provided is based on the expected manner of recognized or settlement of the
carrying amount of assets and liabilities using tax rates enacted or substantially
enacted at the balance sheet date. Deferred tax assets are recognized only to the
extent that it is probable that future profits will be available against which the
asset can be recognized. Deferred tax assets are reduced to the extent that it is
no longer probable that the related tax benefit will be recognized. Deferred tax
assets and liabilities are only offset if there is a legally enforceable right of
set-off.
2.15 PENSIONS
The Company has contribution only pension arrangements in operation for certain
employees.
2.16 USE OF ESTIMATES AND JUDGEMENTS
To be able to prepare accounts according to generally accepted accounting
principles, management must make estimates and assumptions that affect the asset
and liability items and revenue and expense amounts recorded in the financial
statements. These estimates are based on historical experience and various other
assumptions that management and the Board of directors believe are reasonable under
the circumstances. The results of these considerations form the basis for making
judgements about the carrying value of assets and liabilities that are not readily
available from other sources.
The areas requiring the use of estimates and judgements that may significantly
impact the Group’s earnings and financial position include the estimation of the
fair value of investment properties.
The valuation basis of the Group’s investment properties is set out above.
2.17 ADOPTION OF NEW AND REVISED STANDARDS
Standards issued but not yet effective:
There were a number of standards and interpretations which were in issue during the
current period but were not effective at that date and have not been adopted for
these Financial Statements. The Directors have assessed the full impact of these
accounting changes on the Company. To the extent that they may be applicable, the
Directors have concluded that none of these pronouncements will cause material
adjustments to the Group’s Financial Statements. They may result in consequential
changes to the accounting policies and other note disclosures. The new standards
will not be early adopted by the Group and will be incorporated in the preparation
of the Group Financial Statements from the effective dates noted below.
The new standards include:
IFRS 17 Insurance contracts 1
IAS 1 Presentation of financial statements and IFRS Practice Statement 2 1
IAS 8 Accounting policies, changes in accounting estimates and errors 1
IAS 12 Income Taxes 1
IFRS 16 Leases 2
IAS 1 Presentation of financial statements (Amendment – Classification of
Liabilities as Current or Non-Current) 2
IAS 1 Presentation of financial statements (Amendment – Non-current Liabilities
with Covenants) 2
IAS 21 Lack of Exchangeability 3
1 Effective for annual periods beginning on or after 1 January 2023
2 Effective for annual periods beginning on or after 1 January 2024
3 Effective for annual periods beginning on or after 1 January 2025
3 OPERATING SEGMENTS
As described in note 2.1, the Group’s reportable segments under IFRS8 are:
• A portfolio of UK property; and
• Other investment assets.
The disclosures by segment required by IFRS8 are as follows:
Year ended 31 December 2023 Year ended 31 December 2022
UK Property Other UK Property Other
£000 £000 £000 £000
Revenue 305 - 351 -
Net rental income 7 - 51 -
Finance income - 3 - 191
Other gains and losses (73) - 567 -
Finance costs (23) (298) (22) (428)
Depreciation (3) - (3) -
Segment assets 2,501 2,013 3,304 2,597
The remaining overheads and assets are not directly attributable to either of the
operating segments.
4 PROPERTY OPERATING EXPENSES
Year ended Year ended
31 December 31 December
2023 2022
£000 £000
Bad debt charge (27) (22)
Repairs (46) (43)
Business rates and council tax (49) (40)
Irrecoverable service charge (36) (61)
Utilities (15) (4)
Insurance - 23
Managing agent fees (58) (65)
Legal & professional (43) (63)
EPC amortisation, Abortives, and Misc (24) (25)
Total property operating expenses (298) (300)
5. PROPERTY DISPOSALS
Year ended Year ended
31 December 31 December
2023 2022
Number Number
Number of Sales 1 2
£000 £000
Average Value 750 201
Sales
Total sales 750 403
Carrying value (800) (370)
Profit/(Loss) on disposals before transaction (50) 33
costs
Transaction costs
Legal fees (13) (23)
Agent fees, marketing and brochure costs (10) (6)
Total Transaction Costs (23) (29)
Profit/(Loss) on disposals after transaction (73) 4
costs
Transaction costs as percentage of sales value 3% 7%
6 ADMINISTRATIVE EXPENSES
Year Year
ended 31 December ended 31 December
2023 2022
£000 £000
Legal and professional (95) (59)
Tax and audit (33) (35)
Remuneration Costs* (397) (351)
Other (206) (150)
Irrecoverable VAT on Administration expenses ** (12) (9)
Total administrative expenses (743) (604)
*Within the tax and audit figure are £33k (2022: £30k) accrued for auditors
remuneration.
**During the period remuneration consisted of contractors within which £177k
related to directors’ remuneration (2022: £153k). From the end of the year ended 31
December 2023, there were no employees.
7 NET FINANCING (LOSS)/INCOME
Year ended Year ended
31 December 31 December
2023 2022
£000 £000
Interest receivable 18 1
Gain on foreign exchange - 127
Realised Gain or (Loss) on Investment 3 191
Financing income 21 319
Interest paid (5) (20)
Loss on foreign exchange (19) -
Unrealised Gain or (Loss) on Investment (298) (428)
Finance lease depreciation (3) (4)
Head rents treated as finance leases (note 2) (22) (22)
Financing expenses (347) (474)
Net financing (loss)/income (326) (155)
8 TAXATION
Year ended Year ended
31 December 31 December
2023 2022
£000 £000
Loss before tax (1,123) (136)
Corporation tax in the UK of 19%-25% (2022: 19%) (213) (26)
Effects of:
Revaluation deficit and other non-deductible items - -
Deferred tax asset not recognised 28 28
Total tax - -
Following the Company’s adoption of its new investment policy in September 2020,
the Group is considered by HM Customs & Revenue to have exited the REIT tax regime
with effect from 1 October 2018 and, from that date, is fully subject to
corporation tax.
However, the Board believes that the Group’s activities since then and the
availability of tax losses means that the Company’s activities are unlikely to have
generated any material corporation tax liability for periods since 1 October 2018.
Accordingly, no provision for corporation tax has been made in these accounts. The
deferred tax asset not recognised relating to these losses can be carried forward
indefinitely. It is not anticipated that sufficient profits from the residual
business will be generated in the foreseeable future to utilise the losses carried
forward and therefore no deferred tax asset has been recognised in these accounts.
9 EARNINGS PER SHARE
The calculation of basic earnings per share was based on the profit attributable to
ordinary shareholders and a weighted average number of ordinary shares outstanding.
Year ended Year ended
31 December 31 December
2023 2022
£000 £000
The calculation of earnings per share is
based on the loss and number of shares:
Profit/(loss) for the period (£’000) (1,123) (136)
Weighted average number of shares of the 22,697 22,697
Company (‘000)
Earnings per share:
Basic and Diluted (GBP – pence) (4.95) (0.60)
10 INVESTMENT PROPERTIES
Freehold Leasehold Investment Investment Investment Properties Held
Properties Properties for sale
Total
£000 £000 £000 £000
At 31 December 2021 40 2,744 330 3,114
Depreciation – head leases - (3) - (3)
Fair value adjustment – property - 563 - 563
Reclassification of property held for 800 -
sale - (800)
Sale of property (40) - (330) (370)
At 31 December 2022 - 2,504 800 3,304
Depreciation – head leases - (3) - (3)
Reclassification of property held for 130 -
sale - (130)
Sale of property - - (800) (800)
At 31 December 2023 - 2,371 130 2,501
A reconciliation of the portfolio valuation at 31 December 2023 to the total value
for investment properties given in the Consolidated Balance Sheet is as follows:
Year ended Year ended
31 December 31 December
2023 2022
£000 £000
Portfolio valuation 2,168 2,968
Head leases treated as investment properties per IFRS 16 333 336
Total property portfolio 2,501 3,304
Investment Properties held for sale (130) (800)
Investment properties held for development and ongoing 2,371 2,504
rental
The basis for determining fair value is described in note 2.4.
11 AVAILABLE FOR SALE FINANCIAL ASSETS
The Group classifies the following financial assets at fair value through profit or
loss (FVPL):-
Year Year
ended ended 31 December 31 December
2023 2022
£000 £000
Available for sale investments
At the beginning of the period 1,749 1,783
Additions 2,311 5,532
Unrealised gain/(losses) (288) (211)
Disposals (1,759) (5,355)
At 31 December 2,013 1,749
FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT
OR LOSS
Year Year
ended 31 December ended 31 December
2023 2022
£000 £000
Current assets
Available for sale financial assets 2,013 1,749
At 31 December 2,013 1,749
*These assets are formed of equity instruments held on quoted markets globally,
they comprise both long and short positions as per the disclosures in the Strategic
Report.
**These holdings comprise foreign currency balances held for short periods from the
sale and purchase of financial assets through the broker
AFS investments have been valued incorporating Level 1 inputs in accordance with
IFRS7. They are a combination of cash and securities held with the listed broker.
Financial instruments require classification of fair value as determined by
reference to the source of inputs used to derive the fair value. This
classification uses the following three-level hierarchy:
• Level 1 — quoted prices (unadjusted) in active markets for identical assets or
liabilities;
• Level 2 — inputs other than quoted prices included within level 1 that are
observable for the asset or liability, either directly (i.e., as prices) or
indirectly (i.e., derived from prices);
• Level 3 — inputs for the asset or liability that are not based on observable
market data (unobservable inputs).
12 TRADE AND OTHER RECEIVABLES
Year ended Year ended
31 December 31 December
2023 2022
£000 £000
Trade receivables 54 88
Other receivables 210 35
Prepayments 103 110
Total trade and other receivables 367 233
13 CASH AND CASH EQUIVALENTS
Year ended Year ended
31 December 31 December
2023 2022
£000 £000
Cash in the Statement of Cash Flows 1,117 1,721
14 TRADE AND OTHER PAYABLES
Year ended Year ended
31 December 31 December
2023 2022
£000 £000
Trade payables 146 144
Other payables 281 245
Accruals and deferred income 268 179
Head lease liabilities 23 23
Total trade and other payables 718 591
15 LEASE LIABILITIES
Finance lease liabilities on head rents are
payable as follows:
Minimum
Lease Payment
Interest Principal
£000 £000 £000
At 31 December 2021 3,029 (2,682) 346
Movement in value (23) 22 -
At 31 December 2022 3,006 (2,660) 346
Movement in value (23) 23 -
At 31 December 2022 2,983 (2,637) 346
In the above table, interest represents the difference between the carrying amount
and the contractual liability/ cash flow. All leases expire in more than five
years.
16 FINANCIAL INSTRUMENTS AND RISK MANAGEMENT
The Board of directors has overall responsibility for the establishment and
oversight of the Group’s risk management framework.
As described in the Corporate Governance report, this responsibility has been
assigned to the executive directors with support and feedback from the Audit
Committee. The 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.
The Group has identified exposure to the following financial risks from its use of
financial instruments: capital management risk, market risk, credit risk and
liquidity risk.
Capital Management Risk
The Group’s capital consists of cash and equity attributable to the shareholders.
The Board do not consider there is any material capital management risk exposure.
Market Risk
Market risk is the risk that changes in market conditions, such as interest rates,
foreign exchange rates and equity prices, will affect the Group’s profit or loss
and cash flows.
Equity risk is mitigated using a combination of long and short positions to ensure
that fluctuations in the market are hedged against.
As at As at
31 Dec 23 31 Dec 22
£000 £000
Market Risk on Available for Sale Investments
Increase by 1% 20 17
Decrease by 1% (20) (17)
Increase by 5% 101 87
Decrease by 5% (101) (87)
Sensitivity Analysis
IFRS 7 requires an illustration of the impact on the Group’s financial performance
of changes in interest rates. The following sensitivity analysis has been prepared
in accordance with the Group’s existing accounting policies and considers the
impact on the Income Statement and on equity of an increase of 100 basis points
(1%) in interest rates. Any consequential tax impact is excluded.
Actual results in the future may differ materially from these assumptions and, as
such, these tables should not be considered as a projection of likely future gains
and losses.
As at As at
31 Dec 23 31 Dec 22
£000 £000
Interest Rate Risk
Increase by 1% 10 13
Decrease by 1% (10) (13)
Increase by 5% 50 66
Decrease by 5% (50) (66)
Fair value measurements recognised in the statement of financial position
Investment properties and Investment properties held for sale are measured
subsequent to initial recognition at fair value and have been group as Level 3
(2022: level 3) based on the degree to which fair value is observable.
• Level 1 fair value measurements are those derived from quoted prices
(unadjusted) in active markets for identical assets and liabilities;
• Level 2 fair value measurements are those derived from inputs other than quoted
prices included within Level 1 that are observable for the asset or liability,
either directly (i.e. as prices) or indirectly (i.e. derived from prices); and
• Level 3 fair value measurements are those derived from valuation techniques
that include inputs for the asset or liability that are not based on observable
market data (unobservable inputs).
Investment properties have been valued using the investment method which involves
applying a yield to rental income streams.
Inputs include equivalent yield, tenancy information, and leasing assumptions.
Valuation reports are based on both information provided by the Company e.g.
tenancy information including current rents, which are derived from the Company’s
financial and property management systems and are subject to the Company’s overall
control environment, and assumptions applied by the valuers e.g. ERVs, and yields.
These assumptions are based on market observation and the valuers’ professional
judgement.
An increase/decrease in equivalent yields will decrease/increase valuations, and an
increase or decrease in rental values will increase or decrease valuations. Other
inputs include ERVs, and likely void and rent-free periods. There are
interrelationships between these inputs as they are determined by market
conditions. The valuation movement in a period depends on the balance of those
inputs.
Below is a sensitivity analysis of the impact of a 1% increase or decrease in
equivalent yields on income and equity. Actual results may differ materially from
these assumptions and, as such, these tables should not be considered as a
projection of likely future gains and losses.
As at As at
31 Dec 23 31 Dec 22
£000 £000
Interest Rate Risk
Increase by 1% 25 33
Decrease by 1% (25) (33)
Below is a sensitivity analysis of the impact of a 1% increase or decrease in
foreign exchange rates on income and equity. Actual results may differ materially
from these assumptions and, as such, these tables should not be considered as a
projection of likely future gains and losses.
As at As at
31 Dec 23 31 Dec 22
£000 £000
Foreign Exchange Risk
Increase by 1% 13 (0)
Decrease by 1% (27) (8)
Credit Risk
Credit risk is the risk of financial loss to the Group if a tenant, bank or
counterparty to a financial instrument fails to meet its contractual obligations
and arises principally from the Group’s receivables from tenants, cash and cash
equivalents held by the Group’s bankers and derivative financial instruments
entered into with the Group’s bankers.
Trade and Other Receivables
The Group’s exposure to credit risk is influenced mainly by the individual
characteristics of each tenant. At 31 December 2023 the Group had over 30 letting
units in three properties. There is no significant concentration of credit risk due
to the large number of small balances owed by a wide range of tenants who operate
across all retail sectors. There is no concentration of credit risk in any one
geographic area of the UK. The level of arrears is monitored monthly by the Group
on a tenant by tenant basis.
Cash, Cash Equivalents and Derivative Financial Instruments
The banking services used by the Group are split between a major UK bank and a
Swiss private banking corporation for deposit purposes.
Liquidity Risk
Liquidity risk is the risk that the Group will not be able to meet its financial
obligations as they fall due. The Group’s approach to managing liquidity risk is to
ensure, as far as possible, that it will always have adequate resources to meet its
liabilities when they fall due for both the operational needs of the business and
to meet planned future investments. This position is formally reviewed on a
quarterly basis or more frequently should events require it.
The Group’s financial liabilities are classified and are shown with their fair
value as follows:
31 December 2023
At Amortised Total Carrying
At Fair Value
Cost Amount
- - -
Finance lease liabilities 346 346 346
Trade payables 146 146 146
Other payables 281 281 281
Accruals 260 260 260
1,032 1,032 1,032
At Amortised Total Carrying
31 December 2022 At Fair Value
Cost Amount
-
- -
Finance lease liabilities 346 346 346
Trade payables 144 144 144
Other payables 246 246 246
Accruals 179 179 179
914 914 914
For all classes of financial liabilities, the carrying amount is a reasonable
approximation of fair value. The maturity profiles of the Group’s financial
liabilities are as follows:
31 December 2023
Within One to Two to Three Four Over
Contractual One Two Three to Four to Five
Carrying Five
Cash Flows Year Years Years Years Years
Value Years
£000 £000 £000 £000 £000 £000 £000 £000
Finance lease 346 2,983 23 23 23 23 23 2,871
liabilities
Trade payables 146 146 146
Other payables 281 281 281
Accruals 260 260 260
1,032 3,670 709 23 23 23 23 2,871
31 December 2022
Contractual Within One Two Three Four Over
Carrying Cash One to Two to to Four to Five
Three Five
Value Flows Year Years Years Years Years Years
£000 £000 £000 £000 £000 £000 £000 £000
Finance lease 346 3,006 23 23 23 23 23 2,893
liabilities
Trade payables 144 144 144
Other payables 246 246 246
Accruals 179 179 179
914 3,574 591 23 23 23 23 2,893
Contractual cash flows include the undiscounted committed interest cash flows and,
where the amount payable is not fixed, the amount disclosed is determined by
reference to the conditions existing at the year end
17 OPERATING LEASE AS LESSOR
Year ended Year ended
31 December 31 December
2023 2022
£000 £000
Within one year 204 273
After one year but not more than five years 471 759
More than five years 443 513
1,118 1,545
18 CAPITAL COMMITMENTS
No capital expenditure was planned at the balance sheet date.
19 RELATED PARTY BALANCES AND TRANSACTIONS
Transactions with Key Management Personnel
The only transactions with key management personnel relate to remuneration which is
set out in the Remuneration Report.
The key management personnel of the Group for the purposes of related party
disclosures under IAS 24 comprise all executive and non-executive directors.
As at the year end the Group owed £18,505 (2022: £17,073) to Thalassa Holdings
Limited (“Thalassa”), a company under common directorship. During the year services
amounting to £74,166.39 (2022: £91,490) were charges from Thalassa.
The bulk of this sum related to administration fees settled by Thalassa but payable
by the Group. The remained related to accounting and registered office services
supplied to the Group by Thalassa at cost.
The company was accrued £144,213 (2022: £155,000), to Fleur De Lys Ltd, a company
owned and controlled by the Chairman Duncan Soukup, for consultancy and
administration services.
Athenium Consultancy Ltd, a company in which the Group owns shares invoiced the
group for financial and corporate administration services totaling £181,500 for the
period (Dec 2022: £165,000).
20 SHARE CAPITAL
As at 31 Dec 23 As at 31 Dec 22
£ £
Allotted, issued and fully paid:
22,697,000 ordinary shares of £0.01 each 226,970 226,970
9,164,017 treasury shares of £0.01 each 91,640 91,640
Total Share Capital 318,610 318,610
During the year to 30 September 2019, the Company underwent a Court approved
restructure of capital and buy back of shares. Under this action the issued 20p
shares were converted to 1p; capital reserves were transferred to distributable
reserves; 59,808,456 shares were repurchased, and a new Capital Redemption Reserve
of £0.598m was established.
Investment in Own Shares
At the year-end, 9,164,017 shares were held in treasury (December 2022: 9,164,017).
21 GROUP ENTITIES
All the below companies are incorporated in the United Kingdom: -
Effective Share holding
Name of subsidiary Place of incorporation 2023 2022
NOS 4 Limited** United Kingdom 100% 100%
NOS 5 Limited** United Kingdom 100% 100%
NOS 6 Limited** United Kingdom 100% 100%
Gilfin Property Holding Limited***
(Dissolved on 19 Mar 2023) United Kingdom 100% 100%
NOS Holdings Limited** United Kingdom 100% 100%
** Registered office: Eastleigh Court, Bishopstrow, Warminster, Wiltshire BA12 9HW
*** Registered office: 4 Atlantic Quay, 70 York Street, Glasgow, G2 8JX
Subsidiaries NOS 4 Ltd (Registered number: 05707123), NOS 5 Ltd (Registered number:
05707124) and NOS 6 Ltd (Registered number: 06188983) are exempt from the
requirements relating to the audit of accounts under section 479A of the Companies
Act 2006
22 ASSOCIATED ENTITIES
Athenium Consultancy Ltd in which the Group owns 30% shares was incorporated on 12
October 2021. Movement on interests in associates can be summarised as follows:
2023 2022
£000 £000
Carrying value as at 1 January 5 -
Share of profits 12 5
Carrying value as at 31 December 17 5
23 CONTINGENT LIABILITIES
There are currently two potential repair two separate Company currently under
obligations at properties
investigation, including the extent to which the relevant group company may be
required to underwrite such costs as may arise and the extent to which the tenants
or former tenants of the properties are liable to contribute to such costs under
the terms of their tenancy agreements.
24 SUBSEQUENT EVENTS
• Sale of Stafford property classified as an asset held for sale at the year-end
(see note 10);
• Settlement of legal action against The Italian Way, a tenant in Hastings, for
breach of lease covenants.
• Closed out our largest short position with a realised gain of $731k (£587K at
£/$ 1.2437) in 2024 year-to- date.
25 CONTROLLING PARTY AND COPIES OF THE FINANCIAL STATEMENTS
As at 31 December 2023 the Company had no ultimate controlling party.
The consolidated financial statements of Alina Holdings PLC are available to the
public and may be obtained from the Company’s website: 3 www.alina-holdings.com.
COMPANY BALANCE SHEET
AS AT 31 DECEMBER 2023
31 December 31 December
2023 2022
Note £000 £000
Assets
Non-current assets
Investments C2 3,002 3,105
Investments in associated entities 17 5
Total non-current assets 3,019 3,110
Current assets
Trade and other receivables C3 2,492 2,639
Cash and cash equivalents 381 524
Total current assets 2,873 3,163
Liabilities
Current liabilities
Trade and other payables C4 300 199
Total current liabilities 300 199
Net current assets 2,573 2,964
Net assets 5,592 6,074
Shareholders’ Equity
Share capital C5 319 319
Capital redemption reserve C5 598 598
Retained earnings C5 4,675 5,157
Total shareholders’ equity 5,592 6,074
The Company has taken advantage of Section 408 of the Companies Act 2006 and has
not included its own profit and loss account in these financial statements. The
Company’s loss for the period was £0.48m (31 December 2022: £0.06m).
These financial statements were approved by the Board of directors on 29 April 2024
and were signed on its behalf by:
C D Soukup
Director
The registered number of the Company is 05304743.
NOTES TO THE FINANCIAL STATEMENTS
C1. ACCOUNTING POLICIES
These financial statements were prepared in accordance with Financial Reporting
Standard 102 The Financial Reporting Standard applicable in the UK (“FRS 102”) as
issued in March 2018. The presentation currency of these financial statements is
sterling. All amounts in the financial statements have been rounded to the nearest
£1,000.
The consolidated financial statements of Alina Holdings PLC are prepared in
accordance with UK Adopted Accounting Standards (IFRS) and are available to the
public. In these financial statements, the company is considered to be a qualifying
entity (for the purposes of this FRS) and has applied the exemptions available
under FRS 102 in respect of the following disclosures:
• Reconciliation of the number of shares outstanding from the beginning to end of
the period;
• Cash Flow Statement and related notes; and
• Key Management Personnel compensation.
As the consolidated financial statements include the equivalent disclosures, the
Company has also taken the exemptions under FRS 102 available in respect of the
following disclosures:
• Certain disclosures required by FRS 102.26 Share Based Payments; and,
• The disclosures required by FRS 102.11 Basic Financial Instruments and FRS
102.12 Other Financial Instrument Issues in respect of financial instruments
not falling within the fair value accounting rules of Paragraph 36(4) of
Schedule 1.
The Company proposes to continue to adopt the reduced disclosure framework of FRS
102 in its next financial statements.
The accounting policies set out below have, unless otherwise stated, been applied
consistently to all periods presented in these financial statements.
There were no judgements made by the directors, in the application of these
accounting policies that have significant effect on the financial statements, with
a significant risk of material adjustment in the next year.
Measurement convention
The financial statements are prepared on the historical cost basis.
Classification of financial instruments issued by the Company
In accordance with FRS 102.22, financial instruments issued by the Company are
treated as equity only to the extent that they meet the following two conditions:
a. they include no contractual obligations upon the company to deliver cash or
other financial assets or to exchange financial assets or financial liabilities
with another party under conditions that are potentially unfavourable to the
company; and
b. where the instrument will or may be settled in the company’s own equity
instruments, it is either a non- derivative that includes no obligation to
deliver a variable number of the company’s own equity instruments or is a
derivative that will be settled by the company’s exchanging a fixed amount of
cash or other financial assets for a fixed number of its own equity
instruments.
To the extent that this definition is not met, the proceeds of issue are classified
as a financial liability.
Where the instrument so classified takes the legal form of the company’s own
shares, the amounts presented in these financial statements for called up share
capital and share premium account exclude amounts in relation to those shares.
Basic financial instruments
Trade and other creditors are recognised initially at transaction price plus
attributable transaction costs. Subsequent to initial recognition, they are
measured at amortised cost, less any impairment losses in the case of trade
debtors. If the arrangement constitutes a financing transaction, for example if
payment is deferred beyond normal business terms, then it is measured at the
present value of future payments discounted at a market rate of instrument for a
similar debt instrument.
Investments in subsidiaries
These are separate financial statements of the company. Investments in subsidiaries
are carried at cost less impairment.
Judgements and Estimates
In testing for impairment, management assesses the recoverable amount of
investments and inter-company debtors by reference to the subsidiaries’ net assets
and their ability to recover these assets.
Provisions
A provision is recognised in the balance sheet when the Company has a present legal
or constructive obligation as a result of a past event, that can be reliably
measured and it is probable that an outflow of economic benefits will be required
to settle the obligation. Provisions are recognised at the best estimate of the
amount required to settle the obligation at the reporting date.
Where the Company enters into financial guarantee contracts to guarantee the
indebtedness of other companies within its group, the company treats the guarantee
contract as a contingent liability until such time as it becomes probable that the
company will be required to make a payment under the guarantee.
Interest receivable and Interest payable
Interest payable and similar charges include interest payable, finance charges on
shares classified as liabilities and finance leases recognized in profit or loss
using the effective interest method, unwinding of the discount on provisions, and
net foreign exchange losses that are recognized in the profit and loss account.
Taxation
Tax on the profit or loss for the year comprises current and deferred tax. Tax is
recognised in the profit and loss account except to the extent that it relates to
items recognised directly in equity or other comprehensive income, in which case it
is recognised directly in equity or other comprehensive income.
Current tax is the expected tax payable or receivable on the taxable income or loss
for the year, using tax rates enacted or substantively enacted at the balance sheet
date, and any adjustment to tax payable in respect of previous years.
Deferred tax is provided on timing differences which arise from the inclusion of
income and expenses in tax assessments in periods different from those in which
they are recognised in the financial statements. The following timing differences
are not provided for: differences between accumulated depreciation and tax
allowances for the cost of a fixed asset if and when all conditions for retaining
the tax allowances have been met; and differences relating to investments in
subsidiaries to the extent that it is not probable that they will reverse in the
foreseeable future and the reporting entity is able to control the reversal of the
timing difference. Deferred tax is not recognised on permanent differences arising
because certain types of income or expense are non-taxable or are disallowable for
tax or because certain tax charges or allowances are greater or smaller than the
corresponding income or expense.
Deferred tax is measured at the tax rate that is expected to apply to the reversal
of the related difference, using tax rates enacted or substantively enacted at the
balance sheet date. Deferred tax balances are not discounted.
Unrelieved tax losses and other deferred tax assets are recognised only to the
extent that is it probable that they will be recovered against the reversal of
deferred tax liabilities or other future taxable profits.
C2. FIXED ASSETS INVESTMENTS
Shares in Group Undertakings
Total
£000 £000
Cost
At 31 December 2022 108,605 108,605
Disposals (11,355) (11,355)
At 31 December 2023 97,250 97,250
Provisions
At 31 December 2022 105,500 105,500
Impairment charge period (25) (25)
Disposals (11,227) (11,227)
At 31 December 2023 94,248 94,248
Net book value
At 31 December 2023 3,002 3,002
At 31 December 2022 3,105 3,105
An impairment review of the carrying value of the Company’s investments in its
subsidiary undertakings has been performed. In carrying out this review, the
directors had due regard to the nature of the property investments held, which is
commensurate with the funding arrangements in place. On the basis of this review
which included a review of the underlying assets of the individual subsidiaries the
directors have written down the value of investments in subsidiary undertakings to
their estimated realisable value.
The companies in which the Company’s interests at the period end were more than 20%
are as follows:
Name of subsidiary Place of incorporation 2023 2022
NOS 4 Limited** United Kingdom 100% 100%
NOS 5 Limited** United Kingdom 100% 100%
NOS 6 Limited** United Kingdom 100% 100%
Gilfin Property Holding
Limited***
(Dissolved on 19 Mar 2023) United Kingdom 100% 100%
NOS Holdings Limited** United Kingdom 100% 100%
** Registered office: Eastleigh Court, Bishopstrow,
Warminster, Wiltshire BA12 9HW
*** Registered office: 4 Atlantic Quay, 70 York Street,
Glasgow, G2 8JX
C3. TRADE AND OTHER RECEIVABLES
31 December 31 December
2023 2022
£000 £000
Amounts owed by Group undertakings 2,411 2,551
Other debtors 14 15
Prepayments 67 73
2,492 2,639
Amounts owed by group undertakings are interest free and
repayable on demand.
C4. TRADE AND OTHER PAYABLES
31 December 31 December
2023 2022
£000 £000
Trade creditors 112 117
Accruals 188 82
300 199
Amounts owed to group undertakings are interest free and
repayable on demand.
C5. RECONCILIATION OF SHAREHOLDERS’ FUNDS
Share Capital
31 December 2023 31 December 2022
Number Amount Number Amount
000 £000 000 £000
Allotted, called up and fully 31,861 319 31,861 319
paid
31,861 319 31,861 319
Investment in Own Shares
At the year-end, 9,164,017 shares were held in treasury (2022: 9,164,017), and at
the date of this report 9,164,017 were held in treasury.
Statement of Changes in Equity for the 12 months ended 31 December 2023
Capital
Share Capital Redemption Reserves Retained Earnings
Reserves Total
£000 £000 £000 £000 £000
Balance as at 31 December - 598 5,213 6,130
2021 319
Total comprehensive income for - (56) (56)
the year -
Balance as at 31 December - 598 5,157 6,074
2022 319
Total comprehensive income for - - (482) (482)
the year -
Balance as at 31 December - 598 4,675 5,592
2023 319
C6. CONTROLLING PARTY
Please refer to note 25 in the Group Financial Statements
GLOSSARY
Earnings Per Share (“EPS”)
EPS is calculated as profit attributable to shareholders divided by the weighted
average number of shares in issue in the year.
Equivalent Yield
Equivalent yield is a weighted average of the initial yield and reversionary yield
and represents the return a property will produce based upon the timing of the
income received. In accordance with usual practice, the equivalent yields (as
determined by the Group’s external valuers) assume rent received annually in
arrears and on gross values including prospective purchasers’ costs (including
stamp duty, and agents’ and legal fees).
Head Lease
A head lease is a lease under which the Group holds an investment property.
Initial Yield
Initial yield is the annualised net rent generated by a property expressed as a
percentage of the property valuation. In accordance with usual practice the
property value is grossed up to include prospective purchasers’ costs.
Like-for-like Market Rent
This is the Market Rent for the Group’s investment properties at the end of the
financial year compared with the Market Rent for the same properties at the end of
the prior year, i.e. excluding the Market Rent of those properties disposed of
during the interim period.
Like-for-like rental income
This is the rental income for the Group’s investment properties at the end of the
financial year compared with the rental income for the same properties at the end
of the prior year, i.e. excluding rental income of those properties disposed of
during the interim period.
Market Value
Market value is the estimated amount for which a property should exchange on the
date of valuation between a willing buyer and willing seller in an arm’s length
transaction after proper marketing wherein the parties had each acted
knowledgeably, prudently and without compulsion.
Market Rent
Market rent is the estimated amount for which a property should lease on the date
of valuation between a willing lessor and a willing lessee on appropriate lease
terms, in an arm’s length transaction, after proper marketing wherein the parties
had each acted knowledgeably, prudently and without compulsion.
Net Asset Value (“NAV”) per share
NAV per share is calculated as shareholders’ funds divided by the number of shares
in issue at the year-end excluding treasury shares.
Real Estate Investment Trust (“REIT”)
A REIT is a listed property company which qualifies for and has elected to join the
UK REIT tax regime, which exempts qualifying UK property rental income and gains on
investment property disposals from corporation tax. The Group converted to REIT
status on 11 May 2007 and left the REIT tax regime on 1 October 2018
Reversionary Yield
Reversionary yield is the annualised net rent that would be generated by a property
if it were fully let at market rent expressed as a percentage of the property
valuation. In accordance with usual practice the property value is grossed up to
include prospective purchasers’ costs.
═══════════════════════════════════════════════════════════════════════════════════
Dissemination of a Regulatory Announcement that contains inside information in
accordance with the Market Abuse Regulation (MAR), transmitted by EQS Group.
The issuer is solely responsible for the content of this announcement.
═══════════════════════════════════════════════════════════════════════════════════
ISIN: GB00B1VS7G47
Category Code: ACS
TIDM: ALNA
LEI Code: 213800SOAIB9JVCV4D57
Sequence No.: 318888
EQS News ID: 1893049
End of Announcement EQS News Service
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