North Scotland

2014North Scotland

Directors’ Report and Financial Statements

North Scotland

Directors MarkBaxter

AndrewBruce

JohnHope

GavinMacKinlay

PaulMcGirk

HughMurdoch

JamesFraserRoyan

GeraldDonald

Registered number SC390666

Registered office 11ThistlePlace

Aberdeen

AB101UZ

Independent auditor BDOLLP

Citypoint

65HaymarketTerrace

Edinburgh

EH125HD

Bankers BankofScotland

TheMound

Edinburgh

EH11YZ

Solicitors HarperMacLeodLLP

8MelvilleStreet

Edinburgh

EH37N3

Page

Group strategic report 4 - 5

Directors’ report 6

Directors’ responsibilities statement 7

Independent auditor’s report 8

Consolidated profit and loss account 9

Consolidated balance sheet 10

Company balance sheet 11

Consolidated cash flow statement 12

Notes to the financial statements 13 - 22

CompanyInformation Contents

D I R E C TO R S ’ R E P O RT & F I N A N C I A L STAT E M E N TS 2 D I R E C TO R S ’ R E P O RT & F I N A N C I A L STAT E M E N TS3

GroupStrategicReportfortheyearended31December2014

Business review

ThegrouphasreachedfinancialcloseonfourDesign,Build,

FinanceandMaintain(“DBFM”)projectsinScotland,twoof

whicharenowoperational.Thefocusduring2014hasbeen

onprojectdelivery,withfiveDBFMprojectsinprocurement,

twoinconstructionandoneachievingbuildinghandover.

Goingforwardthefocuswillcontinuetobeonproject

deliveryandreachingfurtherfinancialclosesandbuilding

handovers:during2015anadditionalthreeDBFMprojects

areexpectedtoreachfinancialclose.

InadditiontotheDBFMprojects,during2014Hub

hascompletedoneDesignandBuild(“D&B”)project,

commencedconstructionofthreeD&Bprojectsandhasa

furtherthreeD&Bprojectsintheprocurementstage.

Thedirectorshaveconsideredtheperformanceofthegroup

duringtheyear,thefinancialpositionattheendoftheyear

andbelieveitsprospectsforthefuturetobesatisfactoryand

consistentwithhubNorthScotlandLimited’sbusinessplan.

Principal risks and uncertainties

Thedirectorsconsidertheprincipalrisksanduncertaintiesto

beasfollows:

•Delaysinprojectsreachingfinancialcloseresultingin

incomebeingdeferred.Regularprogrammereviewsand

regularcashflowforecastingareperformedtomonitorand

managetheserisksandHubhasanagreedworkingcapital

facilitytomanageincomepeaksandtroughs.

•Continuingreductioninpublicsectorclientbudget,both

revenueandcapital,resultinginreductioninfutureprojects

pipeline.MitigatedbyensuringHubcoisprovidingthebest

valueformoneyandisconstantlyindialoguewithclients

regardingfutureprojectsandstrategicplans.

•Availabilityoffundinginthemarket.SFThavereapproved

programmefundersandliquidityinthegeneralmarketis

increasing.Itisconsideredthereforethatthisriskiscurrently

diminishing,notwithstandingHubcontinuestomonitor.

•Availabilityofresourcewithinthesupplychaininrelationto

location/geographyandthefluctuatingdemandsaround

thenationalpipeline.Supplychainreviewprovidingthe

opportunitytoseekassuranceofcommitmenttoanagreed

andpotentialterritorypipelinetomitigatethegroup’srisk.

•Changingmarketconditionsandabilityofoursupply

chaintoprovideHubwithpricesthatmeetourcontractual

benchmarks.Hubisconsciousofthebuoyantconstruction

marketandhascarriedoutasupplychainrefresh.Hub

currentlyhasfivestrongTier1contractorsandcontinues

toactivelyengageindialoguewiththemtoensurewecan

continuetoprovideourclientswiththebestvalue.

•Abilitytomeetloancovenantstobeabletopaysenior

andsubdebtrepayments.Thisriskismitigatedbyregular

operationalreportingatboardlevelandfortheseniordebt

provider.

•Variableeconomicandmarketconditions.Thelevelof

incomeisrelativelystableasmostrevenueisdueunder

longtermcontractfromtherespectiveauthority,subject

tosatisfactoryperformance.Mostoperatingcostsare

fixedthroughagreedcontractswithsuppliersandmost

financingcostsarefixedthroughlongtermagreementwith

financiers.

Overall,thegroupsbusinessrisksandprojectrisksarebeing

managedundertheprocessessetoutintheOngoingand

Projectmethodstatements.ARiskRegisterisinplaceandis

continuallyreviewedandupdatedbyasteeringgroup,which

includesahubNorthScotlanddirector,andreportedtothe

boardonaquarterlybasis.

Financial key performance indicators

Thegroup’sfinancialperformanceisrecognisedbythevalue

ofdevelopmentmargingeneratedatthecontractcloseof

projectsandtheannualmanagementfeeswithinhubNorth

ScotlandLimited.Thesearemonitoredagainsttheoverhead

runningcostswiththestrategybeingtocoverallsuchcosts

onaneffectivebreakevenbasis.

Other key performance indicators (“KPI’s”)

KPI’sareusedtoprovideinformationonprojectperformance,

sothatanyshortfallscanbepromptlyidentifiedand

addressed.Thesearefocusedaroundhealthandsafety,value

formoneyandquality.Itistheintentionofthegroupto

continuallyimprovethereportinganduseofsuchKPI’s.

Thisreportwasapprovedbytheboardon19thMay,2015

andsignedonitsbehalf.

Mark Baxter

Director

North Scotland


Directors’Reportfortheyearended31December2014 Directors’ResponsibilitiesStatement

Thedirectorspresenttheirreportandthefinancial

statementsfortheyearended31December2014.

Principal activity

Theprincipalactivityofthecompanyandgroupduring

theyearwasprovidingprojectdevelopmentandstrategic

partneringservicestopublicsectorparticipantsintheHub

NorthTerritorytohelpdriveprojectsthroughthekeystages

ofinfrastructureprocurement.

Results

Theprofitfortheyear,aftertaxation,amountedto£286,660

(2013–loss£157,712).

Directors

Thedirectorswhoservedduringtheyearwere:

AndrewBruce

HughMurdoch

GeraldDonald

JohnHope

GavinMacKinlay (appointed 25 September 2014)

PaulMcGirk (appointed 25 September 2014)

JamesFraserRoyan(appointed 25 September 2014)

MarkBaxter(resigned 31 January 2014 and reappointed 21

August 2014)

MartinCooper(appointed 31 January 2014 and resigned 21

August 2014)

HughCrossley(appointed 21 January 2014 and resigned 25

September 2014)

MichaelFelton(resigned 21 January 2014)

TomDeLaMotte(resigned 25 September 2014)

Provision of information to auditor

Eachofthepersonswhoaredirectorsatthetimewhenthis

directors’reportisapprovedhasconfirmedthat:

•sofarasthatdirectorisaware,thereisnorelevantaudit

informationofwhichthecompanyandthegroup’sauditor

isunaware,and

•thatdirectorhastakenallthestepsthatoughttohavebeen

takenasadirectorinordertobeawareofanyinformation

neededbythecompanyandthegroup’sauditorin

connectionwithpreparingtheirreportandtoestablish

thatthecompanyandthegroup’sauditorisawareofthat

information.

Thisreportwasapprovedbytheboardon19thMay,2015

andsignedonitsbehalf.

Mark Baxter

Director

Thedirectorsareresponsibleforpreparingthedirectors’

reportandthefinancialstatementsinaccordancewith

applicablelawandregulations.

Companylawrequiresthedirectorstopreparefinancial

statementsforeachfinancialyear.Underthatlawthe

directorshaveelectedtopreparethefinancialstatements

inaccordancewithUnitedKingdomGenerallyAccepted

AccountingPractice(UnitedKingdomaccountingstandards

andapplicablelaw).Undercompanylawthedirectorsmust

notapprovethefinancialstatementsunlesstheyaresatisfied

thattheygiveatrueandfairviewofthestateofaffairsofthe

companyandoftheprofitorlossofthecompanyforthat

period.

Inpreparingthesefinancialstatementsthedirectorsare

requiredto:

•selectsuitableaccountingpoliciesandthenapplythem

consistently;

•makejudgmentsandaccountingestimatesthatare

reasonableandprudent;

•statewhetherapplicableUKaccountingstandardshave

beenfollowed,subjecttoanymaterialdeparturesdisclosed

andexplainedinthefinancialstatements;and

•preparethefinancialstatementsonthegoingconcernbasis

unlessitisinappropriatetopresumethatthecompanyand

thegroupwillcontinueinbusiness.

Thedirectorsareresponsibleforkeepingadequate

accountingrecordsthataresufficienttoshowandexplainthe

company’stransactions,todisclosewithreasonableaccuracy

atanytimethefinancialpositionofthecompanyandto

enablethemtoensurethatthefinancialstatementscomply

withtheCompaniesAct2006.Theyarealsoresponsiblefor

safeguardingtheassetsofthecompanyandthegroupand

hencefortakingreasonablestepsforthepreventionand

detectionoffraudandotherirregularities.

North Scotland


IndependentAuditor’sReporttothemembersofhubNorthScotlandLimited

ConsolidatedProfitandLossAccountfortheyearended31December2014

WehaveauditedthefinancialstatementsofhubNorth

ScotlandLimitedfortheyearended31December2014

whichcomprisetheconsolidatedprofitandlossaccount,

theconsolidatedandcompanybalancesheets,the

consolidatedcashflowstatementandtherelatednotes.

Thefinancialreportingframeworkthathasbeenapplied

intheirpreparationisapplicablelawandUnitedKingdom

AccountingStandards(UnitedKingdomGenerallyAccepted

AccountingPractice).

Thisreportismadesolelytothecompany’smembers,

asabody,inaccordancewithChapter3ofPart16ofthe

CompaniesAct2006.Ourauditworkhasbeenundertaken

sothatwemightstatetothecompany’smembersthose

matterswearerequiredtostatetotheminanauditor’s

reportandfornootherpurpose.Tothefullestextent

permittedbylaw,wedonotacceptorassumeresponsibility

toanyoneotherthanthecompanyandthecompany’s

membersasabody,forourauditwork,forthisreport,orfor

theopinionswehaveformed.

Respective responsibilities of directors and auditor

Asexplainedmorefullyinthestatementofdirectors’

responsibilities,thedirectorsareresponsibleforthe

preparationofthefinancialstatementsandforbeing

satisfiedthattheygiveatrueandfairview.Ourresponsibility

istoauditandexpressanopiniononthefinancialstatements

inaccordancewithapplicablelawandInternational

StandardsonAuditing(UKandIreland).Thosestandards

requireustocomplywiththeFinancialReportingCouncil’s

(FRC’s)EthicalStandardsforAuditors.

Scope of the audit of the financial statements

Adescriptionofthescopeofanauditoffinancialstatements

isprovidedontheFRC’swebsiteatwww.frc.org.uk/

auditscopeukprivate.

Opinion on financial statements

Inouropinionthefinancialstatements:

•giveatrueandfairviewofthestateofthegroup’sandthe

parentcompany’saffairsasat31December2014andofthe

group’sprofitfortheyearthenended;

•havebeenproperlypreparedinaccordancewithUnited

KingdomGenerallyAcceptedAccountingPractice;and

•havebeenpreparedinaccordancewiththerequirementsof

theCompaniesAct2006.

Opinion on other matter prescribed

by the Companies Act 2006

Inouropiniontheinformationgiveninthestrategicreport

anddirectors’reportforthefinancialyearforwhichthe

financialstatementsarepreparedisconsistentwiththe

financialstatements.

Matters on which we are required to report by exception

Wehavenothingtoreportinrespectofthefollowingmatters

wheretheCompaniesAct2006requiresustoreporttoyouif,

inouropinion:

•adequateaccountingrecordshavenotbeenkeptbythe

parentcompany,orreturnsadequateforouraudithavenot

beenreceivedfrombranchesnotvisitedbyus;or

•theparentcompanyfinancialstatementsarenotin

agreementwiththeaccountingrecordsandreturns;or

•certaindisclosuresofdirectors’remunerationspecifiedby

lawarenotmade;or

•wehavenotreceivedalltheinformationandexplanations

werequireforouraudit.

Alastair Rae(Seniorstatutoryauditor)

forandonbehalfofBDOLLP,Statutoryauditor

Edinburgh,UnitedKingdom

BDOLLPisalimitedliabilitypartnershipregisteredinEngland

andWales(withregisterednumberOC305127).

2014 2013

Note £ £

TURNOVER 1 58,361,910 35,567,424

Costofsales (56,815,351) (35,025,870)

GROSS PROFIT 1,546,559 541,554

Administrativeexpenses (1,019,947) (693,959)

OPERATING PROFIT/(LOSS) 526,612 (152,405)

Interestreceivableandsimilarincome 4 1,387,757 96,481

Interestpayableandsimilarcharges 5 (1,398,965) (101,788)

PROFIT/(LOSS) ON ORDINARY ACTIVITIES BEFORE TAXATION 515,404 (157,712)

Taxonprofit/(loss)onordinaryactivities 6 (228,744) ––

PROFIT/(LOSS) FOR THE FINANCIAL YEAR 12 286,660 (157,712)

Allamountsrelatetocontinuingoperations.

Therewerenorecognisedgainsandlossesfor2014or2013otherthanthoseincludedintheprofitandlossaccount.

Thenotesonpages11to20formpartofthesefinancialstatements.

North Scotland


North Scotland

ConsolidatedBalanceSheetasat31December2014

CompanyBalanceSheetasat31December2014

2014 2013

Note £ £ £ £

CURRENT ASSETS

Debtors:amountsfallingdueafter

morethanoneyear 8

56,808,295

28,588,326

Debtors:amountsfallingduewithin

oneyear 8

4,610,494

3,344,990

Cashatbankandinhand 8,625,086

3,850,511

70,043,875 (35,783,827)

CREDITORS: amountsfallingduewithin

oneyear 9

(19,221,202)

(6,912,310)

NET CURRENT ASSETS

50,822,673

28,871,517

TOTAL ASSETS LESS CURRENT LIABILITIES 50,822,673 28,871,517

CREDITORS: amountsfallingdueafter

morethanoneyear 10 (50,794,384) (29,129,888)

NET ASSETS/(LIABILITIES) 28,289 (258,371)

CAPITAL AND RESERVES

Calledupsharecapital 11 170 170

Profitandlossaccount 12 28,119 (258,541)

SHAREHOLDERS' FUNDS/(DEFICIT) 13 28,289 258,371

Thefinancialstatementswereapprovedandauthorisedforissuebytheboardandweresignedonitsbehalfon19thMay,2015.

Mark Baxter

Director


2014 2013

Note £ £ £ £

FIXED ASSETS

Investments 7

4,000 2,000

CURRENT ASSETS 8

Debtors 1,730,452 2,071,555

Cashatbankandinhand

2,824,943

1,050,888

4,555,395 3,122,443

CREDITORS: amountsfallingduewithin

oneyear 9

(3,754,540) (3,401,213)

NET CURRENT ASSETS/(LIABILITIES) 800,855 (278,770)

NET ASSETS/(LIABILITIES) 804,855 (276,770)

CAPITAL AND RESERVES

Calledupsharecapital 11 170 170

Profitandlossaccount 12

804,685 (276,940)

SHAREHOLDERS' FUNDS/(DEFICIT) 13 804,855 (276,770)

Thefinancialstatementswereapprovedandauthorisedforissuebytheboardandweresignedonitsbehalfon19thMay,2015.

Mark Baxter

Director


D I R E C TO R S ’ R E P O RT & F I N A N C I A L STAT E M E N TS 1 0 D I R E C TO R S ’ R E P O RT & F I N A N C I A L STAT E M E N TS1 1

ConsolidatedCashFlowStatementfortheyearended31December2014

NotestotheFinancialStatementsfortheyearended31December2014

ReconciliationofNetCashFlowtoMovementinNetDebtfortheyearended31December2014

2014 2013

Note £ £

Netcashflowfromoperatingactivities 14 (24,789,774) (20,650,574)

Returnsoninvestmentsandservicingoffinance 15 187,245 (5,307)

CASH OUTFLOW BEFORE FINANCING (24,602,529) (20,655,881)

Financing 15 29,377,104 21,516,061

INCREASE IN CASH IN THE YEAR 4,774,575 860,180

2014 2013

Note £ £

Increaseincashintheyear 4,774,575 860,180

Cashinflowfromincreaseindebtandleasefinancing (29,377,104) (21,516,061)

CHANGE IN NET DEBT RESULTING FROM CASH FLOWS (24,602,529) (20,655,881)

Othernoncashchanges (198,453) ––

MOVEMENT IN NET DEBT IN THE YEAR (24,800,982) (20,655,881)

Netdebtat1January2014 (26,849,249) (6,193,368)

NET DEBT AT 31 DECEMBER 2014 16 (51,650,231) (26,849,249)


1. ACCOUNTING POLICIES

1.1 Basis of preparation of financial statements

Thefinancialstatementshavebeenpreparedunderthehistoricalcostconventionandinaccordancewith

applicableaccountingstandards.

1.2 Basis of consolidation

ThefinancialstatementsconsolidatethefinancialstatementsofhubNorthScotlandLimitedandallofits

investmentsinothercompanieswhich,inlegalform,areclassifiedassubsidiaries.Theterm“subsidiary”hasbeen

usedinthefinancialstatementstorefertotheinvestmentsinlegalsubsidiaries.

Theresultsofsubsidiariesacquiredduringtheyearareincludedfromtheeffectivedateofacquisition.

1.3 Turnover

Turnovercomprisesrevenuerecognisedinrespectofservicesrenderedduringtheyear,exclusiveofValueAdded

Taxandtradediscounts.Turnoveralsoincludestherechargeofcertaincostspassedontothelocalauthority.

1.4 Investments

Investmentsinsubsidiariesarevaluedatcostlessanyprovisionrequiredforimpairment.

1.5 Taxation

Thechargefortaxationisbasedontheresultfortheyearandtakesintoaccounttaxationdeferredbecauseof

timingdifferencesbetweenthetreatmentofcertainitemsfortaxationandaccountingpurposes.Deferredtax

isrecognised,withoutdiscounting,inrespectofalltimingdifferencesbetweenthetreatmentofcertainitems

fortaxationandaccountingpurposeswhichhavearisenbutnotreversedbythebalancesheetdate,exceptas

otherwiserequiredbyFRS19.

1.6 Amounts recoverable on contracts

OnceDBFMprojectshavereachedfinancialclose,duringtheconstructionphaseoftheprojectsSSAP9“Stocksand

LongTermContracts”principleshavebeenapplied.Allconstructioncostsincurred,includingdirectlyattributable

financecosts,areshownasamountsrecoverableoncontracts.

Amountsrecoverableoncontractsarevaluedatthelowerofcostandnetrealisablevalue.Costsincludeoverheads

appropriatetothestageofconstruction.Netrealisablevalueisbaseduponestimatedsellingpricelessfurther

costsexpectedtobeincurredtocompletion.Financecostshavebeencapitalisedtotheextentthattheyrelateto

theconstructionperiod.

InaccordancewithFinancialReportingStandards(FRS5)ApplicationNoteF,thecostsattheendofthe

constructionphasearerecordedasafinancedebtoronthebalancesheet.

North Scotland


NotestotheFinancialStatementsFortheyearended31December2014


2. OPERATING PROFIT/(LOSS)

Theprofit/(loss)onordinaryactivitiesbeforetaxationisstatedaftercharging:

Factors that may affect future tax charges

Thegrouphasapotentialdeferredtaxassetof£2,165(2013:£48,000)inrespectofunrelievedtaxlosses.Nopart

ofthishasbeenrecognisedasthereisinsufficientcertaintyastothefuturerecoverabilityoftheasset.

Therearenootherfactorsthatmayaffectfuturetaxcharges.

3. STAFF COSTS/DIRECTORS FEES

Thecompanyhasnoemployeesotherthanthedirectors.Duringtheyear,adirectorreceivedchairmanfeesof

£22,247(2013:£Nil)

2014 2013

£ £

Feespayabletothecompany’sauditoranditsassociatesfortheauditofthecompany’sfinancialstatements 9,125 8,550

Feespayabletothecompany’sauditoranditsassociatesinrespectof:

Theauditingoffinancialstatementsofassociatesofthecompany 21,128 7,900

Taxationcomplianceservices 5,020 2,325

7. FIXED ASSET INVESTMENTS

Subsidiary undertakings

Thefollowingweresubsidiaryundertakingsofthecompany:

Name Class of shares Holding

AberdeenCommunityHealthCareVillageLimited Ordinaryshares 100%

HubNorthScotland(FWT)Limited Ordinaryshares 100%

HubNorthScotland(Alford)Limited Ordinaryshares 100%

HubNorthScotland(Wick)Limited Ordinaryshares 100%

4. INTEREST RECEIVABLE

2014 2013

£ £

Financeleasedebtorinterest 1,387,757 96,481

6. TAXATION

2014 2013

£ £

UKcorporationtaxchargeonprofit/(loss)fortheyear 228,744 ––

5. INTEREST PAYABLE

2014 2013

£ £

Seniordebtinterest 1,137,294 76,292

Interestonworkingcapitalfromparentcompany 18,000 8,064

Interestonsubordinatedloans 243,671 17,432

1,398,965 101,788

6. TAXATION (continued)

Factors affecting tax charge for the year

Thetaxassessedfortheyearishigherthan(2013lowerthan)thestandardrateofcorporationtaxintheUKof

21.49%(201323.25%).Thedifferencesareexplainedbelow:

2014 2013

£ £

Profit/(loss)onordinaryactivitiesbeforetax 515,404 (157,712)

Profit/(loss)onordinaryactivitiesmultipliedbystandardrateofcorporationtaxintheUKof21.49%(2013-23.25%) 110,760 (36,668)

Effects of:

Expensesnotdeductiblefortaxpurposes 1,015 2,365

Capitalallowances (511) (298)

Taxlosses(utilised)/carriedforward (48,284) 34,601

Otherdifferencesleadingtoanincrease/(decrease)inthetaxcharge 165,764 ––

Current tax charge for the year 228,744 ––

North Scotland




7. FIXED ASSET INVESTMENTS (continued)

Theaggregateofthesharecapitalandreservesasat31December2014andoftheprofitorlossfortheyearended

onthatdateforthesubsidiaryundertakingswereasfollows:

8. DEBTORS

9. CREDITORS

Name

Aggregate of share

capital and reserves Profit/(loss)

£ £

AberdeenCommunityHealthCareVillageLimited 34,216 5,324

HubNorthScotland(FWT)Limited (20,415) (11,920)

HubNorthScotland(Alford)Limited (11,413) (12,413)

HubNorthScotland(Wick)Limited (3,792) (4,792)

DuringtheyearthecompanyacquiredtheentiresharecapitalofHubNorthScotland(Alford)LimitedandHub

NorthScotland(Wick)Limited.

Investments in

subsidiary companies

Company £

Cost or valuation

At1January2014 2,000

Additions 2,000

At31December2014 4,000

Net book value



Due after more than one year

Group Company

2014 2013 2014 2013

£ £ £ £

Financeleasedebtor 32,763,228 17,769,981 –– ––Amountsrecoverableonlongterm

contracts 24,045,067 10,818,345 –– ––

56,808,295 28,588,326 –– ––

Due within one year

Group Company

2014 2013 2014 2013

£ £ £ £

Tradedebtors 1,457,467 1,165,725 1,350,802 1,165,785

Otherdebtors 1,999,241 1,009,808 8,746 307,930

Prepaymentsandaccruedincome 628,846 795,811 370,904 597,840

Financeleasedebtor 524,940 373,646 –– ––

4,610,494 3,344,990 1,730,452 2,071,555

Amounts falling due within one year

Group Company

2014 2013 2014 2013

£ £ £ £

Seniordebtloans 8,838,333 906,872 –– ––

Workingcapitalloans 600,000 600,000 600,000 600,000

Tradecreditors 3,788,335 4,413,944 1,779,396 2,415,853

Amountsowedtogroupundertakings 45,736 48,428 26,874 48,428

Subordinatedloans 42,600 63,000 –– ––

Corporationtax 228,744 –– 228,744 ––

Othertaxationandsocialsecurity 286,806 –– 153,381 ––

Othercreditors 1,254,447 246,143 –– ––

Accrualsanddeferredincome 4,136,201 633,923 966,145 336,932

19,221,202 6,912,310 3,754,540 3,401,213

North Scotland




Amounts falling due after more than one year

Group Company

2014 2013 2014 2013

£ £ £ £

Seniordebtloans 41,702,083 26,139,499 –– ––

Subordinatedloans 9,092,301 2,990,389 –– ––

50,794,384 29,129,888 –– ––

Profit and loss account

Company £

At1January2014 (276,940)

Profitfortheyear 1,081,625


Creditorsincludeamountsnotwhollyrepayablewithin5yearsasfollows:

Group Company

2014 2013 2014 2013

£ £ £ £

Repayablebyinstalments 38,860,837 25,443,557 –– ––

10. CREDITORS

2014 2013

£ £

Allotted, called up and fully paid

17Asharesof£1each 17 17

51Bsharesof£1each 51 51

102Csharesof£1each 102 102

170 170

11. SHARE CAPITAL

Profit and loss account

Group £

At1January2014 (258,541)

Profitfortheyear 286,660


12. RESERVES

2014 2013

Group £ £

Openingshareholders’deficit (258,371) (100,659)

Profit/(loss)forthefinancialyear 286,660 (157,712)

Closingshareholders’funds/(deficit) 28,289 (258,371)

2014 2013

Company £ £

Openingshareholders’deficit (276,770) (92,952)

Profit/(loss)forthefinancialyear 1,081,625 (183,818)

Closingshareholders’funds/(deficit) 804,855 (276,770)

13. RECONCILIATION OF MOVEMENT IN SHAREHOLDERS’ FUNDS

SeniordebtloansrepresentloansfromAvivaPublicPrivateFinanceLimitedwhicharesecuredovertheshare

capitalofthecompanies.Thetotalloanfacilityis£16,900,000forAberdeenCommunityHealthCareVillage,

£14,550,000forHubNorthScotland(FWT)Limited,£27,000,000forHubNorthScotland(Alford)Limitedand

£48,000,000forHubNorthScotland(Wick)Limited.

Thesubordinatedloansrepresentloansfromentitiesinthesamecorporategroupsasthejointcontrollingparties

andshareholdersoftheimmediateparent.Therepaymenttermsandinterestareasfollows:

TheAberdeenCommunityHealthCareVillageloanisrepayableinhalfyearlyinstalmentscommencinginMarch

2014withthefinalrepaymentdueinMarch2039.Theloansareunsecuredandbearinterestatarateof10.2%.

TheHubNorthScotland(FWT)LimitedloanisalsorepayableinhalfyearlyinstalmentscommencinginSeptember


TheHubNorthScotland(Alford)LimitedloanisalsorepayableinhalfyearlyinstalmentscommencinginMarch

2017withthefinalrepaymentdueinSeptember2040.Theloansareunsecuredandbearinterestatarateof

10.2%.

TheHubNorthScotland(Wick)LimitedloanisalsorepayableinhalfyearlyinstalmentscommencinginSeptember


Thecompanyhastakenadvantageoftheexemptioncontainedwithinsection408oftheCompaniesAct2006not

topresentitsownprofitandlossaccount.Theprofitfortheyearinthefinancialstatementsofthecompanywas

£1,081,625(2013–£183,818loss).

North Scotland



2014 2013

£ £

Operatingprofit/(loss) 526,612 (152,405)

Increaseindebtors (29,485,473) (24,228,528)

Increaseincreditors 4,169,087 3,730,359

Net cash outflow from operating activities (24,789,774) (20,650,574)

14. NET CASH FLOW FROM OPERATING ACTIVITIES

2014 2013

£ £

Returns on investments and servicing of finance

Interestreceived 1,387,757 96,481

Interestpaid (1,200,512) (101,788)

Net cash inflow/(outflow) from returns on investments and servicing of finance 187,245 (5,307)

2014 2013

£ £

Financing

Newsecuredloans 30,351,794 21,516,061

Repaymentofloans (974,690) ––

Net cash inflow from financing 29,377,104 21,516,061

15. ANALYSIS OF CASH FLOWS FOR HEADINGS NETTED IN CASH FLOW STATEMENT

1 January Cash FlowOther non-cash

changes 31 December

2014 2014

£ £ £ £

Cash at bank and in hand 3,850,511 4,774,575 –– 8,625,086

Debt:

Debts due within one year (1,569,872) (7,712,608) (198,453) (9,480,933)Debts falling due after more than one

year (29,129,888) (21,664,496) –– (50,794,384)

Net debt (26,849,249) (24,602,529) (198,453) (51,650,231)

16. ANALYSIS OF CHANGES IN NET DEBT


17. RELATED PARTY TRANSACTIONS

Group

Duringtheyear,anamountof£1,227,927(2013:£642,903)wasinvoicedbyACP:NorthHubLimited,ashareholder

ofhubNorthScotlandLimited,inrespectofservicesprovidedtothegroup.£27,798(2013:£48,428)was

outstandingattheyearend.

Duringtheyear,GallfordTryConstruction(UK)Limited,anentityinthesamecorporategroupasGallifordTry

(NorthHub)InvestmentsLimited,ashareholderinACP:NorthHubLimited,invoicedanamountof£37,469,623

(2013:£23,921,945)inrespectofservicesprovidedtothegroup.£1,608,029(2013:£2,913,686)wasoutstanding

attheyearend.

Duringtheyear,anamountof£582,607(2013:£452,182)wasinvoicedbySweettInvestmentsLimited,a

shareholderinACP:NorthHubLimited,inrespectofservicesprovidedtothegroup.Adebtorbalanceof£16,430

(2013:creditorof£279,310)wasoutstandingattheyearendandincludedincurrentassets.

Duringtheyear,anamountof£1,178,710(2013:£117,858)wasinvoicedbySweett(UK)Limited,anentityin

thesamecorporategroupasSweettInvestmentsLimited,ashareholderinACP:NorthHubLimited,inrespectof

servicesprovidedtothegroup.£58,449(2013:£52,922)wasoutstandingattheyearendandisincludedwithin

currentliabilities.

Duringtheyearsubordinatedloanstotalling£9,134,901(2013:£3,053,389)hadbeenprovidedtothegroupby

entitesinthesamecorporategroupsastheshareholdersofACP:NorthHubLimited,(GallifordTry(NorthHub)

InvestmentsLimitedandSweettInvestmentsLimited)andshareholdersofhubNorthScotlandLimited(Scottish

FuturesTrustInvestmentsLimitedandGrampianHealthBoard).Thetotalsubordinatedloansincludedrolledup

interestof£485,498(2013:£248,983).

Company

ThecompanyhastakenadvantageofFRS8andchosennottodiscloserelatedpartytransactionswithmembers

withintheconsolidatedgroup.

Duringtheyear,anamountof£609,144(2013:£456,858)wasinvoicedfromACP:NorthHubLimited,a

shareholderofhubNorthScotlandLimited,inrespectofservicesprovided.£22,345(2013:£48,428)was

outstandingattheyearendandincludedincurrentliabilities.

Duringtheyear,anamountof£16,850,528(2013:£1,785,745)wasinvoicedfromGallifordTryConstruction(UK)

Limited,anentityinthesamecorporategroupasGallifordTry(NorthHub)InvestmentsLimited,ashareholder

inACP:NorthHubLimitedforservicesprovided.£59,376(2013:£873,115)wasoutstandingattheyearendand

includedincurrentliabilities.

Duringtheyear,anamountof£467,632(2013:£437,444)wasinvoicedfromSweettInvestmentsLimited,a

shareholderinACP:NorthHubLimited,inrespectofservicesprovided.Adebtorbalanceof£16,430(2013:creditor

of£279,310)wasoutstandingattheyearendandincludedincurrentassets.

North Scotland



17. RELATED PARTY TRANSACTIONS (continued)

Duringtheyear,anamountof£880,551(2013:£444,404)wasinvoicedfromSweett(UK)Limited,anentityinthe

samecorporategroupasSweettInvestmentsLimited,ashareholderinACP:NorthHubLimited.£46,466(2013:

£49,094)wasoutstandingattheyearendandincludedincurrentliabilities.

Duringtheyear,£Nil(2013:£240,000)wasdrawndownfromtheworkingcapitalfacilityprovidedbyACP:North

HubLimited,ashareholder.Theamountoutstandingattheyearendwas£240,000(2013:£240,000).Interestof

£10,800(2013:£4,839)accruedonthebalanceduringtheyearand£15,501remainedoutstandingattheyearend.

Duringtheyear,£Nil(2013:£42,648)wasdrawndownfromtheworkingcaptialfacilityprovidedbyScottish

FuturesTrust,ashareholder.Theamountofworkingcapitalloanoutstandingattheyearendwas£90,000(2013:

£90,000).Interestof£1,919(2013:£954)wasaccruedonthedrawndownbalanceduringtheyear,and£2,873

remainedoutstandingattheyearend.

Duringtheyear,£Nil(2013:£112,960)wasdrawndownfromtheworkingcapitalloanprovidedbythe15holders

ofOrdinary“B”£1shares.Theamountofworkingcapitalloanoutstandingattheyearendwas£270,000(2013:

£270,000).Interestof£5,281(2013:£2,409)accruedonthedrawndownbalanceduringtheyearand£7,690

remainedoutstandingattheyearend.

18. IMMEDIATE PARENT UNDERTAKING AND CONTROLLING PARTY

TheimmediateparentundertakingisACP:NorthHub.Thedirectorsdonotconsiderthatthereisanultimate

controllingparty.

19. PRINCIPAL SUBSIDIARIES

Company name CountryPercentage Shareholding Description

AberdeenCommunityHealthCareVillageLimited

UnitedKingdom 100 Design,buildandmaintenanceofAberdeenCommunityHealthCareVillage

HubNorthScotland(FWT)Limited UnitedKingdom 100 Design,buildandmaintenanceof3HealthCareCentres

HubNorthScotland(Alford)Limited

UnitedKingdom 100 Design,buildandmaintenanceofAlfordCommunityCampus

HubNorthScotland(Wick)Limited UnitedKingdom 100 Design,buildandmaintenanceofWickCommunityCampus

D I R E C TO R S ’ R E P O RT & F I N A N C I A L STAT E M E N TS 2 2

11 Thistle Place

Aberdeen

AB10 1UZ

[email protected]

Telephone: 01224 639383

www.hubnorthscotland.co.uk

hubnorthscot

North Scotland

North Scotland

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