Transcription
Company Registration No. 2090126Compass Group Holdings PLCAnnual Report and Financial StatementsFor the year ended 30 September 2021
Compass Group Holdings PLCAnnual report and financial statements 2021ContentsPageOfficers and professional advisers1Strategic Report2Directors’ Report4Directors’ Responsibilities Statement7Independent Auditor’s Report to the members of Compass Group Holdings PLC8Profit and loss account12Statement of other comprehensive income13Balance sheet14Statement of changes in equity15Notes to the accounts16
Compass Group Holdings PLCAnnual report and financial statements 2021Officers and professional advisersDirectorsD W BlakemoreC P BrownA R YappSecretaryA R YappRegistered OfficeCompass HouseGuildford StreetChertseySurreyKT16 9BQAuditorKPMG LLP15 Canada SquareLondonE14 5GL1
Compass Group Holdings PLCStrategic ReportThe directors, in preparing this Strategic Report, have complied with section 414C of the Companies Act 2006 (CA2006).Business review and principal activitiesCompass Group Holdings PLC (the Company) manages and licenses trademarks to its subsidiary undertakings and itis the intention of the directors that the Company will continue to act in this capacity. Hospitality Holdings Limitedholds 99.938% and Compass Group PLC holds 0.062% of the Ordinary shares of the Company.The results for the Company show a pre-tax profit for the year of 189,400,000 (2020: 42,800,000) and net assets at30 September 2021 of 4,698,600,000 (2020: 4,560,600,000). The future prospects of the Company remain in linewith current results and the directors do not anticipate any material changes to the activities of the Company.The Company’s directors believe that analysis using key performance indicators is not necessary for an understandingof the position of the business. The performance of Compass Group PLC (the Group) is discussed in its Annual Reportwhich does not form part of this Report. A copy of the Compass Group PLC Annual Report 2021 (annual report) canbe found on the Compass Group PLC website at www.compass-group.com or from the Company SecretarialDepartment at Compass House, Guildford Street, Chertsey, Surrey, KT16 9BQ. The Company will continue to act asa management company in the future.Principal risks and uncertaintiesThe global pandemic has continued longer than expected and while Group operations continue to be disrupted, ourfocus has been on the health, safety and wellbeing of our employees, clients and consumers. Sites that are open areoperating with enhanced health and safety protocols. Personal protective equipment requirements are in line with localgovernment and public health guidance and there is a continued focus on mental health awareness.A post-Brexit deal on trade and other issues was agreed in December 2020 between the UK and the EU. While thereis clearly more for the UK and EU to work through, we believe that the deal as agreed, coupled with our owncontingency planning, means we do not expect any material financial or operational impact resulting from Brexit. Weare confident that we can continue supporting and delivering great services for our UK and international clients andconsumers.The Company has only intra-group investments and balances, no third party debt and hence no external interest rateexposure. Certain investments in subsidiary undertakings and intra-group balances are denominated in foreign currencyand so there is a gain/loss associated with the translation taken to the profit and loss account.From the perspective of the Company, the principal risks and uncertainties are integrated with the principal risks of theGroup and are not managed separately. The principal risks of the Group are discussed in Compass Group PLC’s AnnualReport 2021 which does not form part of this Report. Both of these documents can be viewed on the Compass GroupPLC website www.compass-group.com.Section 172(1) statement – Compass Group Holdings PLCSection 172 of the Companies Act 2006 requires a director of a company to act in the way he or she considers, in goodfaith, would most likely promote the success of the company for the benefit of its members as a whole. In doing thissection 172 requires a director to have regard, amongst other matters, to the: likely consequences of any decisions in the long-term;interests of the company’s employees;need to foster the company’s business relationships with suppliers, customers and others;impact of the company’s operations on the community and environment;desirability of the company maintaining a reputation for high standards of business conduct, andneed to act fairly as between members of the company.2
Compass Group Holdings PLCStrategic Report (continued)Section 172(1) statement – Compass Group Holdings PLC (continued)In discharging their duties under section 172 the directors have regards to both the factors set out above and others thatmay be considered relevant to the decisions being made. The directors acknowledge that every decision made will notnecessarily result in a positive outcome for all of the Company’s stakeholders. By considering the Company’s purpose,vision and values together with its strategic priorities and having a process in place for decision-making, the directorsaim to ensure that Board decisions are consistent and predictable.As is normal for large companies, the directors delegate authority for day-to-day management of the Company toexecutives engaged in setting, approving and overseeing the execution of the business strategy and related policies ofthe Group. While there are cases where the board itself judges that it should engage directly with certain stakeholdergroups or on certain issues, the size and spread of both our stakeholders and the Group means that generally stakeholderengagement best takes place at an operational or Group level. The directors consider that as well as being a moreefficient and effective approach, this also helps achieve a greater positive impact on environmental, social and otherissues than by working alone as an individual company. How the Group engages with its stakeholders is described onpages 28 to 31 of the Compass Group PLC Annual Report 2021 (the ARA).The principal activity of the Company is to act as a holding company for other entities in the Group, and to manageand licence trademarks to its subsidiary undertakings. In this context the Company’s main stakeholders are othercompanies within the Group, and the Company’s employees. The views of and the impact of the Company’s activitieson those stakeholders are an important consideration for the directors when making relevant decisions. Moreinformation on how the directors engage with the Company’s employees and take account of their interests, and howdirectors have engaged with suppliers, customers and others in a business relationship with the Company are describedin the Directors’ Report.Examples of how the directors have had regard to the matters set out in section 172(1)(a)-(f) when discharging theirsection 172 duties, and the effect of those decisions, include the consideration of the adoption by the Company of theCompass Subsidiary Governance Code (the Code), and the Compass Group PLC Modern Slavery and HumanTrafficking Statement (the MSA). In deciding whether to adopt the Code the directors considered whether its adoptionwould be in the best interests of its stakeholders, including its shareholders, employees and other group companies. Itwas concluded that formalising the governance arrangements of the Company, particularly with regard to theconsideration of stakeholder views when taking decisions would be in the best interest of stakeholders as a whole. Inadopting the MSA the directors considered whether appropriate controls and procedures were in place to mitigate therisk of human trafficking within the Company’s supply chains. It was concluded that adoption of the MSA statementand the Company’s continued efforts in this area was in the best interests of the Company’s employees and its widerstakeholder community.Going ConcernAfter making enquiries and receiving a letter of support from the ultimate parent company, Compass Group PLC, thedirectors have a reasonable expectation that the Company, as part of the Compass Group, has adequate resources tocontinue in existence for the 12 months from the date of approval of this Report. For this reason, the directors continueto adopt the going concern basis in preparing the accounts.Approved by the Board of Directors and signed on behalf of the BoardC P BrownDirector31 March 2022Compass Group Holdings PLCRegistered in England and Wales No. 20901263
Compass Group Holdings PLCDirectors’ ReportThe directors present their Annual Report and the audited financial statements for the year ended 30 September 2021.DirectorsThe following served as directors during the year and were in office at the date of signing the Report and FinancialStatements unless otherwise indicated:D W BlakemoreC P Brown (appointed 1 November 2021)K Witts (resigned 31 October 2021)A R YappDividendsThe Company did not pay interim dividends to the parent company during the year (2020: nil). The directors do notrecommend the payment of a final dividend in respect of the financial year ended 30 September 2021 (2020: nil).Branches outside the UKThe Company has a branch in France with offices in Paris and Marseille.EmployeesThe Company and the Group place importance on employee engagement, keeping employees regularly informed onmatters of concern to them as employees, issues affecting their performance, and promoting a common awareness ofthe financial and economic factors affecting the performance of the Company. For the Company’s employees,engagement is achieved through management briefings, team meetings and town halls, bulletins and other in housepublications and through the Group’s internal communications channels. Employees are also represented on theGroup’s European Works Council, which provides a forum for exchanging information and engaging in consultationon the Group’s performance and plans, and relevant transnational issues affecting those countries in the EEA and inthe UK. Feedback from employee engagement informs the directors’ decision making processes, and those decisionstaken and policies made on a wider Group basis. For further information on how the Group engages with employeesglobally see pages 32 to 39 of the ARA.Employees are offered a range of benefits, such as private medical cover, depending on the local environment. Priorityis given to the training of employees and the development of their skills is of prime importance. Employment ofdisabled people is considered on merit with regard only to the ability of any applicant to carry out the function required.Arrangements to enable disabled people to carry out the function required will be made if it is reasonable to do so. Anemployee becoming disabled would, where appropriate, be offered retraining.Business RelationshipsThe Company has limited engagement with external parties such as suppliers, clients, consumers and others. In thelimited circumstances where the Company does interact with external business partners, in line with the Group’spolicies and procedures the directors promote and ensure the highest standards of ethical behaviour and probity in theCompany’s business dealings. For further information on how the Group fosters business relationships with its businesspartners see pages 28 to 31 of the ARA.Directors’ qualifying third party indemnityA qualifying third party indemnity provision as defined in section 234(2) - (6) of the CA 2006 is and was in full forceand effect for the benefit of each of the directors of the Company, both at the date of this Report and throughout thefinancial year to which this Report relates.4
Compass Group Holdings PLCDirectors’ Report (continued)Modern Slavery Act StatementThe Company falls within the scope of Section 54 (Transparency in Supply Chain requirements) of the Modern SlaveryAct 2015 (the “Act”) and consequently is obliged to prepare and publish a slavery and human trafficking statement foreach financial year of the organisation.In accordance with the Home Office guidance to the Act it is permissible for a parent company, where one or moresubsidiaries in the same group are required to produce a statement, to produce one statement that subsidiaries can useto meet the requirements of the Act (provided that the statement fully covers the steps that each of the organisationsrequired to produce a statement have taken in the relevant financial year).In accordance with the requirements of the Act, the Company’s ultimate parent, Compass Group PLC, prepared andpublished a slavery and human trafficking statement for the financial year ended 30 September 2021 (the Statement)which contemplated the steps that the Company, as part of the Compass Group of companies, had taken during thefinancial year to ensure that slavery and human trafficking is not taking place in any of its supply chains, or in any partof its own business and consequently, it was considered by the directors, that the steps contemplated by the Statementscontinued to be relevant to the Company and it remained appropriate that the Company continue to automatically adoptthe statements of Compass Group PLC. A copy of the Statement can be found at www.compass-group.com.Statement of Corporate Governance ArrangementsIn compliance with the Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008 asamended by The Companies (Miscellaneous Reporting) Regulations 2018, the Company hereby discloses its Statementof Corporate Governance Arrangements.The Company’s ultimate parent, Compass Group PLC, is subject to and complies with the UK Corporate GovernanceCode 2018. As a subsidiary of Compass Group PLC, the Company, together with other companies within the Group,is subject to and adheres with certain governance arrangements, structures and policies that are common throughoutthe Compass Group PLC group of companies. The specific governance arrangements adopted by the Company aredefined by the ‘Compass Subsidiary Governance Code’ (the Subsidiary Code), the principles of which, and how theCompany has applied them during the financial year ended 30 September 2021, are detailed below.Code PrinciplePurpose and Leadership - The board will promotethe purpose of the company, and ensure that itsvalues, strategy and culture align with that ofCompass Group PLC.Board Composition - The board will be chairedeffectively and composed of individuals with therequisite balance of skills, backgrounds, experienceand knowledge. Individual directors will havesufficient capacity to make a valuable contribution.How the Company has applied the Subsidiary CodeDuring the year, in accordance with their duties as directorsof the Company, the directors promoted the purpose of theCompany ensuring that its activities and goals were alignedto those of the Compass Group.The Board of the Company comprised the Group ChiefExecutive Officer, Group Chief Finance Officer and theGroup General Counsel and Company Secretary of theCompany’s ultimate parent, Compass Group PLC. Eachdirector demonstrated the capacity to make a valuablecontribution during the year.Director Responsibilities - The board andindividual directors will have a clear understandingof their accountability and responsibilities. Boardprocedures will support effective decision-makingand independent challenge.A review of governance arrangements and directors’ dutieswas undertaken during the year which refreshed thedirectors’ knowledge of their responsibilities with respect tothe Company. Board procedures were supported by theCompass Group Secretariat.Opportunity and Risk - The board will promotethe long-term sustainable success of the company byidentifying opportunities to create and preservevalue, and will establish and maintain oversight ofthe identification and mitigation of risks.Opportunity and existing and emerging risks were managedin line with the strategy and risk profile of Compass GroupPLC which prepares consolidated accounts for the CompassGroup, further details of which can be found on pages 73 to81 of the Compass Group PLC Annual Report 2021.5
Compass Group Holdings PLCDirectors’ Report (continued)Stakeholder Relationships and Engagement - Theboard will be responsible for ensuring themaintenance of stakeholder relationships and theoversight of engagement with stakeholders,including the workforce. The board will have regardto stakeholder views when taking decisions.The Board ensured that stakeholder relationships as wererelevant to the status and purpose of the Company weremaintained in line with Compass Group PLC policies andprocedures. Details of how the directors consideredstakeholders in the decision making process can be found inthe S172 statement on pages 2 to 3.Directors’ disclosure of information to the auditorEach of the persons who is a director at the date of approval of this Report confirms that: so far as the director is aware, there is no relevant audit information of which the Company's auditor is unaware the director has taken all the steps that he/she ought to have taken as a director in order to make himself/herselfaware of any relevant audit information and to establish that the Company's auditor is aware of that informationThis confirmation is given and should be interpreted in accordance with the provisions of section 418 of the CA 2006.AuditorIn accordance with the provisions of section 485(2) of the CA 2006, the current appointment of KPMG LLP as theCompany’s auditor will end at the conclusion of the current period for appointing auditors.Pursuant to Section 487 of the CA 2006, the auditor will be deemed to be reappointed and KPMG LLP will thereforecontinue in office.Approved by the Board of Directors and signed on behalf of the BoardC P BrownDirector31 March 2022Compass Group Holdings PLCRegistered in England and Wales No. 20901266
Compass Group Holdings PLCDirectors’ Responsibilities StatementThe directors are responsible for preparing the Strategic Report, the Directors’ Report and the financial statements inaccordance with applicable law and regulations.Company law requires the directors to prepare financial statements for each financial year. Under that law they haveelected to prepare the financial statements in accordance with UK Accounting Standards and applicable law (UKGenerally Accepted Accounting Practice), including FRS 101 Reduced Disclosure Framework.Under company law the directors must not approve the financial statements unless they are satisfied that they give atrue and fair view of the state of affairs of the Company and of the profit or loss of the Company for that period. Inpreparing these 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; state whether applicable UK accounting standards have been followed, subject to any material departures disclosedand explained in the financial statements; assess the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to goingconcern; and use the going concern basis of accounting unless they either intend to liquidate the 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 theCompany’s transactions and disclose with reasonable accuracy at any time the financial position of the company andenable them to ensure that the financial statements comply with the CA 2006. They are responsible for such internalcontrol as they determine is necessary to enable the preparation of financial statements that are free from materialmisstatement, whether due to fraud or error, and have general responsibility for taking such steps as are reasonablyopen to them to safeguard the assets of the company and to prevent and detect fraud and other irregularities.On behalf of the BoardC P BrownDirector31 March 20227
Independent Auditor’s Report to the Members of Compass Group Holdings PLCOpinionWe have audited the financial statements of Compass Group Holdings PLC (“the company”) for the year ended 30September 2021 which comprise the Profit and loss account, Statement of other comprehensive income, Balance sheet,Statement of changes in equity, and related notes, including the accounting policies in note 1.In our opinion the financial statements: give a true and fair view of the state of the company’s affairs as at 30 September 2021 and of its profit for the yearthen ended; have been properly prepared in accordance with UK accounting standards, including FRS 101 Reduced DisclosureFramework; and have been prepared in accordance with the requirements of the Companies Act 2006.Basis for opinionWe conducted our audit in accordance with International Standards on Auditing (UK) (“ISAs (UK)”) and applicablelaw. Our responsibilities are described below. We have fulfilled our ethical responsibilities under, and are independentof the company in accordance with, UK ethical requirements including the FRC Ethical Standard. We believe that theaudit evidence we have obtained is a sufficient and appropriate basis for our opinion.Going concernThe directors have prepared the financial statements on the going concern basis as they do not intend to liquidate theCompany or to cease its operations, and as they have concluded that the Company’s financial position means that thisis realistic. They have also concluded that there are no material uncertainties that could have cast significant doubt overits ability to continue as a going concern for at least a year from the date of approval of the financial statements (“thegoing concern period”).We used our knowledge of the Company, its industry, and the general economic environment to identify the inherentrisks to its business model and analysed how those risks might affect the Company’s financial resources or ability tocontinue operations over the going concern period. The risks that we considered most likely to adversely affect theCompany’s available financial resources over this period were those impacting Compass Group PLC (the Group), onwhich the company places reliance for financial support. These were: The uncertainty of the impact of COVID-19 on the Group, with future range of possible effects such as furtherwaves of global infections currently unknown to performance, given the rapidly evolving nature; and The ability of the Group to respond and adapt to structural changes in the industry as a result of COVID-19.We also considered less predictable but realistic second order impacts, such as the impact of inflationary increases inthe cost of labour or food and adverse changes in economic conditions, which could result in a rapid reduction ofavailable financial resources.We considered whether these risks could plausibly affect the liquidity or covenant compliance in the going concernperiod by comparing severe, but plausible, downside scenarios that could arise from these risks individually andcollectively against the level of available financial resources and covenants indicated by the Group’s financial forecasts.We considered whether the going concern disclosure in note 1 to the financial statements gives a full and accuratedescription of the directors’ assessment of going concern. We assessed the completeness of the going concerndisclosure. Our conclusions based on this work: we consider that the directors’ use of the going concern basis of accounting in the preparation of the financialstatements is appropriate; we have not identified and concur with the directors’ assessment that there is not, a material uncertainty related toevents or conditions that, individually or collectively, may cast significant doubt on the company's ability tocontinue as a going concern for the going concern period8
Independent Auditor’s Report to the Members of Compass Group Holdings PLC(continued)However, as we cannot predict all future events or conditions and as subsequent events may result in outcomes that areinconsistent with judgements that were reasonable at the time they were made, the above conclusions are not a guaranteethat the company will continue in operation.Fraud and breaches of laws and regulations – ability to detectIdentifying and responding to risks of material misstatement due to fraudTo identify risks of material misstatement due to fraud (“fraud risks”) we assessed events or conditions that couldindicate an incentive or pressure to commit fraud or provide an opportunity to commit fraud. Our risk assessmentprocedures included enquiring of directors and inspection of policy documentation as to the Compass Group PLC’sgroup policies and procedures to prevent and detect fraud that apply to this group company as well as enquiring whetherthe directors have knowledge of any actual, suspected, or alleged fraud.As required by auditing standards we perform procedures to address the risk of management override of controls, inparticular the risk that management may be in a position to make inappropriate accounting entries. On this audit we donot believe there is a fraud risk related to revenue recognition because of the simple nature of revenue, which is earnedsolely from franchise and management fees charged to related parties.We did not identify any additional fraud risks.Identifying and responding to risks of material misstatement due to non-compliance with laws and regulationsWe identified areas of laws and regulations that could reasonably be expected to have a material effect on the financialstatements from our general commercial and sector experience and through discussion with the directors and othermanagement (as required by auditing standards), and from inspection of the Company’s regulatory and legalcorrespondence and discussed with the directors and other management the policies and procedures regardingcompliance with laws and regulations.We communicated identified laws and regulations throughout our team and remained alert to any indications of noncompliance throughout the audit.The potential effect of these laws and regulations on the financial statements varies considerably.The Company is subject to laws and regulations that directly affect the financial statements including financial reportinglegislation (including related companies legislation), distributable profits legislation, and taxation legislation, and weassessed the extent of compliance with these laws and regulations as part of our procedures on the related financialstatement items.This company, as a holding company, is not subject to other laws and regulations where the consequences of noncompliance could have a material effect on amounts or disclosures in the financial statements.Context of the ability of the audit to detect fraud or breaches of law or regulationOwing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some materialmisstatements in the financial statements, even though we have properly planned and performed our audit in accordancewith auditing standards. For example, the further removed non-compliance with laws and regulations is from the eventsand transactions reflected in the financial statements, the less likely the inherently limited procedures required byauditing standards would identify it.In addition, as with any audit, there remained a higher risk of non-detection of fraud, as these may involve collusion,forgery, intentional omissions, misrepresentations, or the override of internal controls. Our audit procedures aredesigned to detect material misstatement. We are not responsible for preventing non-compliance or fraud and cannotbe expected to detect non-compliance with all laws and regulations.9
Independent Auditor’s Report to the Members of Compass Group Holdings PLC(continued)Strategic report and directors’ reportThe directors are responsible for the strategic report and the directors’ report. Our opinion on the financial statementsdoes not cover those reports and we do not express an audit opinion thereon.Our responsibility is to read the strategic report and the directors’ report and, in doing so, consider whether, based onour financial statements audit work, the information therein is materially misstated or inconsistent with the financialstatements or our audit knowledge. Based solely on that work: we have not identified material misstatements in the strategic report and the directors’ report; in our opinion the information given in those reports for the financial year is consistent with the financialstatements; and in our opinion those reports have been prepared in accordance with the Companies Act 2006.Matters on which we are required to report by exceptionUnder the Companies Act 2006 we are required to report to you if, in our opinion: adequate accounting records have not been kept, or returns adequate for our audit have not been received frombranches not visited by us; or the financial statements are not in agreement with the accounting records and returns; or certain disclosures of directors’ remuneration specified by law are not made; or we have not received all the information and explanations we require for our audit.We have nothing to report in these respects.Directors’ responsibilitiesAs explained more fully in their statement set out on page 7, the directors are responsible for: the preparation of thefinancial statements and for being satisfied that they give a true and fair view; such internal control as they determineis necessary to enable the preparation of financial statements that are free from material misstatement, whether due tofraud or error; assessing the company’s ability to continue as a goi
A copy of the Compass Group PLC Annual Report 2021 (annual report) can . www.compass-group.com. or from theCompany Secretarial Department at Compass House, Guildford Street, Chertsey, Surrey, KT16 9BQ. The Company will continue to act as a management company in the future. . Employees are offered a range of benefits, such as private medical .
