THE ALL ENGLAND LAWN TENNIS GROUND PLC Annual Report & Financial Statements
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THE ALL ENGLAND LAWN TENNIS GROUND PLC Annual Report & FINANCIAL Statements for THE yEAR ENDED 31 JULy 2011 m BLEDON.CO m WI Contents OFFICERS AND PROFESSIONAL ADVISERS officers andp rofessional Advisers 1 report of the directors 2—5 DIRECTORS statement of directors’ responsibilities 6 J A H CURRY Cbe fCA (CHAIRMAN) independent Auditors’ report 7 P W breTherTon consolidated profit andl oss Account 8 p g h brook fIA consolidated balance sheet 9 J s dunninghAm obe company balance sheet 10 MIss V F gooding Cbe consolidated cash Flow statement 11 s g smiTh obe fRICs notes to the Financial statements 12—22 Secretary r g ATkinson fCMA Auditors deloitte LLP chArTered AccountanTs AND sTATuTORY AUDITORS hill house 1 little new StreeT london EC4A 3Tr Solicitors cms cAmeron mckennA miTre house 160 Aldersgate StreeT london ec1A 4dd BANkERS hsbc bAnk plc wesT end corporate bAnking cenTre 70 Pall mAll london SW1y 5eZ Registrars AND TRANSFER OFFICE The All englAnd lAwn Tennis ground plc church roAd wimbledon london SW19 5Ae Registered OFFICE deloiTTe llp hill house 1 liTTle new StreeT london ec4A 3Tr The All englAnd Lawn Tennis ground plc And subsidiAry undertakings 1 THE CHAmPIONS 2011 Report of the Directors The directors submit their annual report on the affairs of the Balance sheet group together with the financial statements and auditors’ historically, the group has been able to fund the development of report for the year ended 31 July 2011. its grounds from cash inflows generated through its facility fee and the issue of debentures. however, due to the magnitude of 1. PRINCIPAL ACTIVITIES expenditure on redeveloping centre court, the group arranged The group’s principal activities are the ownership and development a £75,000,000 secured term loan with HSBC on 31 August 2007 of grounds in wimbledon, london SW19, which are made available which was drawn down in full during the year ended 31 July 2009. for playing lawn tennis and croquet generally and for staging the As at 31 July 2011, the outstanding balance on this loan stood at wimbledon championships (‘The championships’) specifically. £50,000,000 (2010: £65,000,000) with the repayments having There have not been any significant changes in the group’s been made in accordance with the repayment schedule agreed principal activities in the year under review. The directors are with HSBC. not aware, at the date of this report, of any likely major changes in the group’s activities in the next year. As shown in the analysis As at 31 July 2011, the net book value of the group’s tangible of turnover on page 13, the majority of the group’s income is from fixed assets stood at £332,917,000 (2010: £329,696,000), cash the facility fee associated with staging The championships. balances stood at £21,186,000 (2010: £12,952,000) and long term borrowings stood at £45,500,000 (2010: £55,425,000) 2. BUSINESS REVIEW representing the outstanding long term balance on the loan facility Long Term Plan of £40,000,000 and the nominal value of the 2011-15 centre court The group is nearing completion of its firstl ong Term plan to debenture issue and the 2012-2016 no. 1 court debenture issue. develop the grounds in order to ensure that The championships are provided with world class facilities for players, spectators, Debenture issues media and staff.o ver the last 15 years, the group has invested in may 2009, the group announced the successful issue of 2,500 substantially in the long Term plan constructing a new no.1 centre court debentures relating to the 2011-15 championships. court, the broadcast centre, the millennium building, the museum proceeds amounting to £37,500,000 (net of VAT) were received building and a new court 2 and also comprehensively redeveloping prior to the year ended 31 July 2011. proceeds totalling a further centre court including installing a retractable roof in order to allow £22,500,000 were received during the year ended 31 July 2011. play to take place in wet weather. in June 2011, the group announced the successful issue of 1,000 during the financial year ended 31 July 2011, the group continued no. 1 court debentures relating to the 2012-16 championships. the implementation of the long Term plan. it completed new proceeds amounting to £3,250,000 (net of VAT) were received courts 3 and 4 and a number of other buildings to meet the during the year ended 31 July 2011. needs of the grounds and the building maintenance staff.i t also carried out the construction of new balconies providing extended As a result of these debenture issues the balance on the facilities for no.1 court debenture holders. These two projects were debenture premium reserve increased to £243,852,000 completed in time for the 2011 championships and accounted for (2010: £218,602,000). proceeds totalling a further £8,250,000 substantially all of the group’s fixed asset additions of £15,056,000 are due to be received in respect of the no. 1 court debentures during the financial year (2010: £11,921,000). by 31 January 2012. The proceeds will be used to help repay the £75,000,000 loan in accordance with a repayment schedule over the next two years, the group will carry out a redevelopment running through to 31 January 2015. of the millennium building in order to expand and improve the space available to the players. in addition, the group has now Related parties begun a planning process for further development of the grounds on 14 may 2009 the group, the lawn Tennis Association (‘the lTA’) over the next decade or so. and The All england lawn Tennis and croquet club (‘the club’) agreed arrangements for the continuation of their relationship in Depreciation and facility fee respect of The championships for at least a further 40 years The depreciation charge of £11,835,000 (2010: £10,618,000) from 1 August 2013. under these arrangements, the club will reflects the commencement of depreciation on capital expenditure purchase all of the lTA’s shares in the company as at 1 August 2013 on the two projects completed during the financial year ended subject to certain conditions being satisfied and will be permitted 31 July 2011. The facility fee of £14,581,000 (2010: 13,425,000) to instruct the company to buy back its own shares in order to increased correspondingly to provide a 2% return on capital meet some or all of the club’s obligations to the lTA. in addition, expenditure on these two projects. The facility fee will increase the group will receive a facility fee broadly protected against in each of the next two financial years in line with inflation. inflation for 40 years based on the facility fee received for the year ending 31 July 2013. Novak Djokovic Petra Kvitova GENTLEmEN’S SINGLES CHAmPION LADIES’ SINGLES CHAmPION The All englAnd Lawn Tennis ground plc And subsidiAry undertakings 3 Report of the Directors Olympics on 1 August 2011, the club’s assets, liabilities, rights and Liquidity and cash flow risk 8. DIRECTORS in september 2010, the company and the club signed a “venue obligations (including its shares in the company) were historically, the group has been able to fund the development of The directors during the year under review were: use agreement” with the london organising committee of the transferred to a newly formed company The All england its grounds from cash inflows generated through its facility fee and olympic games and paralympic games limited (“LOCOG”) which lawn Tennis & croquet club limited (“clubco”). control of the issue of debentures. however, as expected, in the years ended ‘A’ Directors sets out the terms and conditions under which the company’s clubco rests with the same group of individuals who 31 July 2008 and 2009, the group’s capital expenditure on its long J A h curry (chairman), p g h brook (appointed 13 december grounds will be used by LOCOG to stage the tennis event at the previously controlled the club. clubco or its subsidiaries Term plan exceeded its cash flows. As a result, the group signed a 2010), J s dunningham , T d phillips (resigned 10 december 2010). 2012 london olympics. will, in effect, replace thec lub as a counterparty in certain long-term £75,000,000 secured loan facility on 31 August 2007 contractual matters. which was used to fund capital expenditure. ‘B’ Directors 3. GROUP RESULTS p w bretherton , d p howorth (resigned 3 February 2011), The consolidated operating profit of £2,241,000 (2010: £3,194,000) on 1 october 2011, the lTA’s shares in the company were The loan facility is due to be repaid according to an agreed miss V F gooding (appointed 3 February 2011), s g smith. was lower than the prior year due primarily to costs related to transferred to a newly formed company lawn Tennis Association repayment schedule using receipts from the annual facility fee the planning process for further development of the grounds. limited (“lTAco”). The members of lTAco (i.e. its counties, and future issues of debentures. The directors are confident that in accordance with the Articles of Association, the three ‘A’ The profit after taxation of £13,000 (2010: £1,320,000) was national and island Associations and other represented bodies) The championships will continue to pay the facility fee and that directors are appointed by the club and the three ‘b’ directors also lower than the prior year due primarily to costs related are the same as members of the lTA.