Luminar Annual Report 2010: Leader in Late Night Entertainment

Luminar
Luminar Group Holdings plc Annual Report 2010

Leader
in late night
entertainment
Luminar Group Holdings plc
Annual Report 2010
Stock Code: LMR
www.luminar.co.uk
Luminar House
Deltic Avenue
Rooksley
Milton Keynes
MK13 8LW
Luminar Group Holdings plc www.luminar.co.uk
Leader in late night entertainment
Creating Destination Entertainment Venues
Business Review
02 Performance Overview
04 Our Brands
06 Our Customers
08 Delivering our Strategy
10 Chairman’s Statement
12 Business Review
Governance
22 Corporate Social Responsibility
30 Board of Directors
32 Corporate Governance Statement
40 Remuneration Report
49 Report of the Directors
Consolidated Financial Statements

56 Independent Auditors’ Report
57 Consolidated Income Statement
57 Consolidated Statement of Comprehensive
Income
58 Consolidated Balance Sheet
59 Consolidated Cash Flow Statement
59 Net Debt Statement
60 Consolidated Statement of Changes
in Shareholders’ Equity
61 Principal Accounting Policies for the Consolidated
Financial Statements
70 Notes to the Consolidated Financial
Statements
Company Financial Statements

107 Company Balance Sheet
108 Principal Accounting Policies for the Company
111 Notes to the Company Financial Statements
Shareholder Information
122 Notice of Annual General Meeting
126 Explanatory Notes to the Notice of
Annual General Meeting
129 Appendix One
134 Appendix Two
136 Shareholder Information
01
Luminar Group Holdings plc Stock Code: LMR Overview
Business Review
Governance
Overview Consolidated Financial Statements
02 03
“The best operational capability

in our sector.”
The Group’s strategy remains clearly focused on

continuing to be the premier operator and utilising our
operational skills to generate the best returns available for
all stakeholders.
Luminar has the best venues and the best operational

capability in our sector. We remain confident that
these strengths will continue to serve Luminar well, and
that we can continue to enhance our position as the
leading operator.
Luminar venues welcome over 250,000 customers through

its doors every week.
Pictured
01 Main room, Ipswich, Liquid.
02 The room for retro classics,

New York Disco.
03 “Play that funky music”, customers

enjoying the groove.
02
Performance Overview
Our Strategy
At Luminar we aim to provide the highest levels

of service and care to our customers by utilising Re-focus our
our assets to create destination entertainment operational template
venues capable of delivering a suite of lifestyle We will improve our product
and our customer service.
products. These products offer different
experiences to a variety of people at different
times to suit their needs.
Improve our
Key Facts marketing skills
Luminar began trading in 1988 The first Liquid nightclub was opened We will make sure our clubs
in Cardiff 2000 and the first Oceana was are fashionable and relevant.
The Company was established by Stephen opened in Milton Keynes in 2002
Thomas who was Chief Executive until
March 2010 Luminar acquired fourteen venues
through the purchase of the Nightclub
It became the most successful leisure Company in 2005
company of the early 1990’s
Luminar undertook a Scheme of
Luminar plc listed on the London Stock Arrangement in October 2007 which Develop central Head
Exchange in May 1996 returned £41m to shareholders and Office infrastructure
Luminar purchased 27 venues from Allied established the new holding company
We will ensure it provides
Leisure for £35m in December 1999 Luminar Group Holdings Plc
support that really makes a
difference.
Key Risks
The main risks facing the business are set out addressing all the health and safety
in more detail on pages 14, 15 and 16 and issues that face any business which has
include both Internal and External Risks. a high number of customers
Strengthen the use of
Internal Risks External Risks our assets
These include: These include: We will rationalise our estate
over time.
ensuring covenant compliance under responding to regulatory change
Read more on pages 8, 9 and 14
the terms of the Group’s Syndicated (such as smoking, noise legislation
Loan Facility and the imposition of mandatory
licensing conditions)
having a structure with a high
proportion of fixed overheads and dealing with Licensing Authorities and
variable revenues other organisations so as to maintain
the licenses that are necessary to trade
needing to respond quickly to changes
in fashion and consumer taste monitoring interest rate movements
and all costs associated with borrowing
the possibility of a major fire in a club
03
Business Review
Governance
Financial Highlights
Total Revenue
Total Revenue† (£m)
201.3
193.2
Sales (per head) (£)
12.24 12.29 12.46
-10%
£173.1m
173.1
Profit before tax
-78%
£4.4m
2008 2009 2010 2008 2009 2010
Gross margins
Profit before tax
pre-exceptional items† (£m) Gross margins (%) +0.2%
82.6%
31.5 83.7 82.4 82.6
Sales (per head)
+1.4%
20.3
£12.46
4.4
2008 2009 2010 2008 2009 2010 Cash Inflow
Net cash inflow

pre-exceptional items (£m) Net borrowings (£m)
-42%
£31.5m
54.1 54.3 141.8

137.5
Net borrowings
Reduced 35%
92.6
31.5
£92.6m
2008 2009 2010 2008 2009 2010
† Continuing operations.
04
Our Brands
Luminar trades 87 of the largest nightclubs in

the United Kingdom. Its venues are divided into
three distinct brands.
Luminar trades 87 of the largest nightclubs in the In addition to the branded venues (i.e. the buildings
United Kingdom. Its venues are divided into various from which we trade) as stated on page 12 of this
brands, of which the main ones are Oceana, Liquid Report, Luminar stages over 20,000 sessions in its
and Lava & Ignite. clubs each year. Some of these sessions have a specific
theme and so carry their own distinct branding. These
In addition to the main branded formats, we also sessions or ‘events’ can be run in any of our venues Luminar has the
operate 32 venues that do not fit within our branded and segment our business to ensure that we offer a best venues and the
templates. This is for a number of reasons, such as range of products that appeal to as diverse a number best operational
the premises being physically impossible to be turned of customers as possible. In the same way that there capability in its
into a branded venue, because it appeals to a different are now more television channels than ever before, sector.
niche market or because it has a smaller capacity so too are there ever more types of music. We believe
than would be typical for a branded nightclub. We that to continue to be successful, we need to cater for
call these nightclubs “Gems” and examples of these this segmentation of music tastes. Examples of these
include the Jam House in Birmingham, the Sugar Mill event or theme-led sessions include: Vibe; Waster;
in Hull or Batchwood Hall in St Albans. These venues Big Night Out; and the very successful “UK Club
continue to operate successfully and achieve good Culture” (“UKCC”), which is our brand for young
returns for the Group. people from ages 13 to 17. Last year we operated over
800 UKCC sessions.
Group Revenue by Brand

Unbranded Luminar is the
27% Oceana
largest Late night
entertainer in the
29% United Kingdom.
Liquid
36%
Lava & Ignite
8%
Pictured
01 Ice-cold lager on tap.
02 State-of-the-art lighting at Liquid,

Colchester.
03 VIP bar Oceana, Swansea.
01 02 04 Liquid & Envy, Basildon.

05
Business Review
Governance
03
Escape to the multi-award-winning Oceana and let us take you on a journey

‘around the world’.
Start your journey with a drink at First Port, Villa Tahiti, Tokyo Wakyama bar,
or relax in the Aspen Ski Lodge. Head to the New York Disco for a night of retro
classics or why not experience the cool and bright interior of the Icehouse
Reykjavik. Who knows where you’ll end up in a venue offering wonderfully
different ‘ports of call’ all under one roof.
04
Liquid guarantees an amazing atmosphere and a fantastic night for people who
love their music.
The UK’s leading nightclub brand combines state-of-the-art lighting, sound

and laser technology with stunning 360-degree graphics and visuals to enhance
the clubbing experience. Liquid’s contemporary, award-winning design and the
country’s top DJs and PAs help to attract clubbers back time and time again for
an incomparable experience at the home of music.
The secondary room ‘Envy’ is targeted to the more sophisticated clubber with
alternative music genres and promoters widening the appeal.
The classic two-room format — easily adaptable to meet a wide variety of

needs and events.
The main room includes amazing sound and laser technology, and is also
flexible enough to be transformed into the perfect venue for corporate events,
live music and televised sporting events. The second room focuses on different
music genres and promoters to attract the more sophisticated clubber.
06
Our Customers
Luminar continues to offer real value

to its customers and aims to remain relevant
and fashionable, keeping up with their
ever-changing demands.
Although we have seen a decline in admissions over by the fact that we have seen an increase in spend per Average footfall
the past year, it is always worth remembering that we head this year and we consider that this an indication (per week)
currently welcome over 13 million customers a year that customers appreciate the products we offer.
to our clubs. This makes us one of the UK’s biggest
leisure companies and certainly makes us number
one in our sector. Clearly this number of customers
Over the next few years we aim to stay abreast
of developments in popular culture and musical
taste. We will continue to communicate regularly
267,000
2009: 304,000
would not visit our clubs if we were not offering an
experience that they could recreate somewhere else with our customers through a variety of digital and
or which was not an enjoyable night out at a price social media channels, to ensure that we respond Average sales per
appropriately to their ever changing tastes and
they can afford. customer
fashions. Our new websites, which offer greater
Earlier in this Report, we mentioned the increasing
segmentation of music genres and although customer
visits have reduced, we believe that this is largely due
functionality and are significantly easier to use than
before, were launched in May and our social media
hub will be launched in June. We anticipate that these
£12.46
2009: £12.29
to the impact of the economy and job prospects channels will build customer loyalty, drive data and
among customers in our target market, rather than increase revenues for the Group.
an issue with the events we run. This is demonstrated
01
07
Business Review
Governance
Pictured
01 Main room, Liquid, Romford,
entertaining our customers.
02 Enjoy a night with friends, book a

VIP booth.
03 Dancing the night away.
02 03
Customer profile
30+ years Under 18 years
2%
Share of total
3%
Share of total
customers customers
24–30 years
17%
Share of total 18–24 years
luminar aims to
78%
customers
provide the highest
Share of total
customers levels of service
and care to our
customers
Satisfaction survey results (based on 973 visits)
Excellent experience
4%
Poor experience
Good experience
1%
95%
our customer
database has
almost two million
members
08
Delivering Our Strategy
Luminar aims to remain the number one provider

in the late night entertainment sector and as
customer tastes change we need to review
regularly and adapt accordingly to maintain
this position.
How we do it
Leveraging our assets
We are investigating further ways to increase our market
Operating an
As stated elsewhere in this Report, we have, during the
past four years, spent nearly £140m on our estate. With the share and we know that by continuing to ensure that we effective and
impact of the recession still being felt across the country, provide value for money and an enjoyable experience we cost-Efficient
we believe we have been fortunate to have made this will continue to have the opportunity to grow our business. Business.
investment already and are now able to adapt to the new Delivering on these actions should enable us to maintain the
financial order. This is why we have been able to focus our trend of increasing spend per head this year.
attention on driving sales through increasing the number
of sessions rather than having to undertake expensive
capital projects.
Delighting Our Customers How we measure it
The growth of new theme-led events has enabled us to Customer Satisfaction
take advantage of specific niche markets that exist in the
areas in which each club operates. For example, we have Beyond Hello is our customer experience programme. Its
operated some successful Bhangra nights, which have a objective is to provide our customers with the ultimate
strong appeal to the Asian market. nightclub experience by involving and engaging all our
crew members in the importance of service. The better
As we continue to understand our customers we will the night out our customers have, the more likely they
increasingly be able to offer them additional entertainment are to come back again and again. Beyond Hello extends
that has a different emphasis from the normal public from the service that a customer receives on arrival at the
dancing, which forms the core of our business. club and continues throughout their experience to the
Growing our Customer Base moment that they leave at the end of the night. Through
We are fully aware that we are competing with other

this programme, we receive regular feedback from our average score of
customers to measure their satisfaction in the service that
companies in the leisure sector (such as cinemas and we provide.
84% in customer
restaurants) for the discretionary spend of our customers satisfaction survey
and so need to ensure that our offering is competitive to New Customers across the year
the young people who form the bulk of our customers. We currently operate over 800 UKCC events throughout
To ensure that we remain relevant to young people today the year. These are for young people below the age of 18
we are investing a good deal of energy and resource in and so no alcohol is served at them. Young people can
obtaining information about our customers. Part of this enjoy the best entertainment in the form of music and
strategy includes growing our membership and providing dancing combined with the best light shows and graphics
the right mix of events for them. in the industry, yet without having access to alcohol
Demonstrating value for money or illicit substances. We recognise that these people
will become our customers of the future and so we are
We have, this year, joined NOCTIS which is the trade continuously learning from them. For example, more
association that represents our industry. We have so far UKCC customers buy tickets from us through our website
found the information that they make available to their and we see this as a good indication of future trends. This
members who operate late bars and clubs extremely information supports our investment into our digital
useful. In addition, we have used industry data from a channels and social media hub.
variety of sources to assess our market and help shape our
future strategies. In the Report produced in December
2008 by Mintel entitled “Nightclubs Leisure Intelligence”, it
estimates that the total turnover for the sector in 2008 was
£1.78bn. While we know that we are currently experiencing
a difficult trading environment we still see this as a
tremendous opportunity to grow our business.
09
Business Review
Governance
Our plans for 2010

Luminar believes that over the next few years there will 3. Luminar will improve its marketing skills
be significant opportunities to strengthen its market to make sure its clubs are fashionable and
position. We believe this because the late night market relevant for its customers.
has contracted significantly. There was a reduction
during the year ending December 2008 of 13% in the In practice this means enhancing Luminar’s brands in the
number of nightclubs operating in the UK. In contrast, three critical areas of:
Luminar’s estate throughout this period remained better promotion of our clubs and our products;
relatively stable. Therefore, as the supply contracts there clearer and more accurately targeted campaigns to
should be more opportunities for Luminar to capitalise explain key activities; and
on the opportunities that arise due to the exiting of other developing associations with other brands to which
operators. young people aspire.
Luminar sees this as an advantage, which will enable the
business to consolidate its position and then grow again as This will be achieved by:
the general economic climate improves. a review of campaigns that have been run so far; and
The key opportunities to do this lie in: being better at the development of all on-line and digital media
what we do; leveraging our strengths, and going deeper or capabilities.
broader into our core market.
4. Luminar will develop its central head
These strategic directions are equally appropriate for focus office infrastructure to add genuine value to
in the short and the longer term. the nightclub operations.
There are five key areas where we will concentrate our In practice this means improving the support given to all
efforts in 2010. clubs in the three critical areas of:
1. Luminar will be customer focused delivering services to the clubs that really makes a
at all times. difference to their operation;
providing solutions to trading problems as they arise;
In practice this means applying the mentality of “Think
and
Customer” in the three critical areas of:
enabling front-line operations to be leaner, simpler and Expected £10m
trends and fashions; more effective. cost savings in
reviewing our brands and developing new exciting
products; and This will be achieved by:
forthcoming
ensuring what we do is relevant. financial year.
establishing a central hub of business support to
provide solutions to problems as they arise;
This will be achieved by:
using this central hub to reduce or remove the
capturing up-to-date data from a variety of sources, for administrative burden facing each club; and
example Beyond Hello feedback and market research working better with our suppliers to ensure that all
surveys; employees can focus on giving better customer service.
understanding this information; and
applying it to understand our customers, position our 5. Luminar will improve the use of its
business and build plans for the future. property assets.
In practice this means reviewing the estate and considering
2. Luminar will work to improve its
the three critical areas of:
operational template.
monitoring existing clubs to ensure that all venues
In practice this means improving the product in the three
remain in the best possible place in each town;
critical areas of:
identifying new locations in existing or new towns or
music; other prosperous areas that should be introduced over
drinks range; and time; and
customer service standards. rationalising the estate to ensure each venue achieves its
optimum trading performance.
engaging our staff more; and
encouraging their entrepreneurial talents and flair to improving relationships with landlords;
lead their local markets. working better with external property advisors; and
developing venues more simply and cost effectively,
with modern materials.
10
Chairman’s Statement
Overview and Strategy of its units were branded dancing venues. The Board
Luminar is the leading operator of late night venues in is grateful to him for his efforts and the significant
the UK, with high quality trading clubs including the contribution he has made.
Oceana and Liquid brands.
Robert McDonald joined the Board in March 2009 in
The market for late night entertainment has the position of Finance Director. He brings substantial
continued to be challenging, especially since last experience of the leisure sector and has a strong track
September, and has caused our second half results to record of delivery. At the time of announcing the
be below our original expectations. There are many results for the year ended 25 February 2010, it has also Alan Jackson
contributing factors to the market weakness, including been announced that Robert has decided to step down Chairman
the general economic climate, youth unemployment, from the Board on 31 May 2010. The Board would like
a highly competitive environment and the severe to extend its thanks to Robert for his endeavours during
winter weather. In the light of these circumstances, we his time in the business. “we continue to
have initiated a significant cost reduction programme lead our market,
and commenced a strategic review of our business, Following the year end, Stephen Thomas left the our asset base is
the key points of which are described below. Board on 1 March 2010. He was the Chief Executive strong and we are
and established the Company in 1988. Throughout repositioning and
Our financial results for the year ended 25 February his term of office, Stephen contributed greatly to strengthening
2010 reflected this market weakness, and were the overall strategic positioning of the Company. areas of our
dominated by lower sales, which were caused by a The Board is extremely grateful for his significant business for the
lower number of customer admissions. Once inside our contribution, which was instrumental in shaping the future.”
clubs, it was encouraging to see that sales per customer business into what it is today.
changed very little from the prior year, and that we were
able to maintain reasonable prices and margins. Simon Douglas joined the Board in March 2010 in
the position of Chief Executive. Simon has a strong
In the circumstances, it has been necessary to impair track record in the leisure and entertainment sector,
certain asset values and to fully provide against our including various management roles at HMV, Virgin
investment in 3D Entertainment Group Ltd (“3DE”), Retail and latterly as CEO in leading the MBO of Zavvi,
which caused a large exceptional charge for the year. where he extracted considerable shareholder value
3DE, in which Luminar holds a 49% investment, was from the businesses.
placed in administration on 26 February 2010 and is
an example of how the recession has impacted our John Leach joined the Board as a Non-Executive
industry. Director on 30 April 2010. John has wide experience
of both the leisure sector and most recently the City
Results where from 2003 to 2008 he was involved in various
The results are set out in the financial statements on roles and latterly as Chief Executive of Hermes Focus
pages 57 to 60. They are also discussed in the Business Asset Management Limited.
Review on pages 12 to 20.
Philip Bowcock joins the Board as Finance Director
Corporate Social Responsibility on 1 June 2010 from Barratt Developments plc,
The Group’s Corporate Social Responsibility where from August 2007 he has been Group Financial
Statement is set out on pages 22 to 29. Controller. Prior to this, he held senior finance roles at
Tesco and Hilton Group.
The Group’s activities are principally in the late night
market for entertaining, dancing and drinking with Current Trading
the sale of alcoholic drink being a significant ancillary Current trading has continued to be difficult, as the
activity. The Group places considerable emphasis market weakness has not yet subsided and we see no
on developing, maintaining and monitoring policies improvement in customer sentiment. Same outlet
and processes designed to protect the well-being and sales for the first ten weeks of the new financial year,
welfare of customers and employees. The Group is to 6 May 2010, were 19.4% below the same period for
also committed to taking into account the interests of last year. The outlook for our customers continues
the communities in which it operates. to be uncertain, youth unemployment remains at
historically high levels, and spending levels may be
Board Changes
constrained for some time to come.
Nick Beighton left the Board on 26 April 2009. He
was the Finance Director and throughout his term of We are undertaking many focused initiatives to
office contributed greatly to the transformation of the address this situation.
Company to becoming a business in which the majority
Pictured
01 Oceana, Brighton.
11
Business Review
Governance
01
Significant cost reduction is under way, and is Summary

expected to reduce our costs by some £10m in the Trading since year end has continued to be weak. In
current financial year on top of the savings made direct response to this we have continued to reduce
in the past year. In particular, an initiative to reduce our costs and to exit certain properties that are loss-
our central costs by £3m (25%) has already been making or where prospects are low. At the same time
completed, and costs are being tightened throughout we are repositioning and strengthening areas of our
the business. business for the future.
We have also begun to address our underperforming We continue to lead our market, our asset base is
and marginal sites. Since the year end four sites have strong, and we see good potential for recovery. The
been sold or returned to their landlords, removing appointment of Simon Douglas as Chief Executive
a profit drain and distraction on the business. A on 8 March 2010 has brought a fresh vision and
further five properties are likely to be exited in the perspective to the business. Whilst recovery may
next three months. take some time to deliver fully, there is a good base
from which to grow and a renewed focus that we feel
In addition, we have now appointed a new Marketing confident will bring significant improvement
and E-Commerce Director, with skills and experience over time.
in the music and retailing industry. We have also
moved to improve our drinks range, to refocus our I wish to announce that I am stepping down as
incentives, and to improve our customer service. Chairman of Luminar as of 13 July 2010. During the
term of my appointment, I have overseen the change
These actions will improve our performance and over of the Board. Now that the building blocks are in place
time will contribute to recovery. to reignite the growth of Luminar, it is the right time
Dividend for me to step down. John Leach will be appointed as
To conserve cash, no interim dividend was paid and my successor and I wish him every success in the role.
no final dividend has been recommended.
Alan Jackson
Chairman
12 May 2010
12
Business Review
Operational Business Review The pattern of the slowdown in sales was consistent
As at 25 February 2010, Luminar operated 87 late across the country, and affected all regions and
night venues in 76 towns and cities, the largest estate types of venue. Whilst timing coincided with a new
of its kind in the UK. We traded 13 larger nightclubs student academic year, the impact was most badly
under the Oceana brand, and 34 under the Liquid felt at weekends and, therefore, appeared to be more
brand, with all of our clubs retaining an identity that a reflection of the general economic conditions
reflects their local community. Our customers are and nationwide recession, and in particular youth
predominantly in the 18–24 year age group, including unemployment.
many students, and some 63% of our drink sales are Simon Douglas
made after midnight. Our primary income streams In view of the unexpected pressure on sales, the Chief executive
are the sale of drinks (67%) and admission charges on Group curtailed investment plans in the second half
entry (27%). of the year, ultimately restricting capital expenditure
to £4.2m in the year. In addition, much tighter cost “luminar provides
The late night entertainment market has contracted control was exerted in operational costs, leading to a a better customer
in the tight economy but continues to be highly controllable cost reduction of £6m across experience,
competitive, leading to a high level of promotional the year. focusing on
discounting and often a low quality environment providing strong
being offered by our competitors. Luminar’s The results for the year do not do justice to the hard entertainment
operational strategy has been to provide a better work and dedication shown by our staff, sometimes content and
customer experience at reasonable prices and to in very difficult circumstances and late into the night. reasons to visit.”
focus on providing strong entertainment content We would like to thank them for their efforts.
and reasons to visit. Mainstream dancing sessions Strategic Review
on Fridays and Saturdays are supplemented by The recent changes in our market, the appointment of
differentiated speciality sessions in midweek, reaching Simon Douglas as Chief Executive and the reduction
out to wider markets. in profitability called for a reappraisal of the Group’s
strategy. This will take some months to complete
During the year ended 25 February 2010, we operated
fully, particularly in the circumstances where our
20,096 sessions and attracted 13.9m people to our
immediate priority is to improve trading results.
venues. On a slightly smaller estate, overall admission
numbers reduced by 11.5% in the year, with the Initial views have been formed, however, and some
majority of the shortfall occurring on weekend nights, clear strategic directions have emerged, which are
which were 13.7% lower. Notwithstanding this, the compatible with short-term priorities.
overall sales per customer remained strong at £12.46,
17p above last year’s level. The average retail selling It is clear that Luminar has many strengths. We
price per measured drink (including VAT) was £2.15 operate in a large, cash-rich market, our assets are
across the year, slightly lower than £2.20 charged in the predominantly modern and well invested, and we
prior year, with broadly steady levels of consumption. have some talented and very experienced people.
Gross margins were 82.6%, slightly ahead of last year. Our product is well established and will stand the test luminar operated
of time. 20,096 sessions in the
Overall sales in the continuing business totalled year to 25 February
£173.1m in the year, a reduction of 10.4% on the Our biggest external challenge, however, is that 2010
prior year, or 9.9% on a same outlet basis across 85 our market has become severely affected by the
venues, which traded in both years. For the first half recession and some structural change has increased
of the year, same outlet sales fell by 3.8% but a sudden competition significantly. Our biggest internal
deterioration in September followed by severe winter challenge is to ensure that our venues continue to
weather caused second half sales to be 15.4% below be fashionable, relevant and appealing to our core
the same period in the prior year. market.
The key opportunities lie in being better at what we

do, in leveraging our strengths, and in going deeper
or broader into our core market. These are strategic
directions that are equally appropriate for the short-
term focus.
Pictured
01 Icehouse Reykjavick, Oceana, Swansea.
02 Let our bartenders quench your thirst.
03 New York Disco.

13
Business Review
Governance
01
02 03
14
Business Review (continued)
There are five key areas where we will concentrate our Underlying this activity is the need to improve our
efforts: financial model, to ensure we have adequate and
appropriate funding that enables the business to
Firstly, we will ensure we are customer focused prosper. As part of this, we must improve our cost luminar attracted
at all times. We will “Think Customer” and apply base and our efficiency. 13.9 million
this mentality in building our plans for the future, customers in the
keeping our products and venues fashionable and These are strategic directions that we will expand on last financial year
relevant; at a later date but they are also guiding actions now as
we seek to improve performance.
We will improve our operational template. We
will improve our product, critically our music, our Risks and uncertainties
drinks range, and our customer service standards. The principal risks and uncertainties that could affect
We will engage our staff more, and encourage the Group’s business are summarised below.
entrepreneurial talents and local flair to lead the
Risks
local markets;
Internal risks
We will improve our marketing skills, to make Covenant compliance
sure our clubs are fashionable and relevant for The Group benefits from a syndicated loan facility
our customers. We will enhance our brands, our of £175m, which extends until August 2012 and
key activities, and develop associations with other against which net borrowings are currently £92.6m.
brands that young people aspire towards. Of vital The facility is subject to financial covenants, the most
importance will be the development of our online significant of which requires net borrowings not to
capability; exceed three times the value of adjusted EBITDA. At
25 February 2010, this covenant test ratio was 2.6×,
We will develop our central head office providing adequate headroom within the facility.
infrastructure to add genuine value to the nightclub
operations. It must provide support that really The Group’s budgeted cash flow projections
makes a difference and be leaner, more effective, anticipate sufficient cash generation to retain and
and simpler; and increase covenant headroom over the course of the
forthcoming year. However, recent trading has fallen
We will improve the use of our assets, rationalising below budgeted levels and the market continues to
our estate over time, and extending into new be volatile.
and more prosperous areas. We will improve
relationships with landlords and develop properties If these volatile conditions continue, the Directors
more simply and cost effectively, with modern have examined available mitigating actions through
materials. further cost reduction or retail price management but
recognise there is the potential for headroom on the
We will approach these tasks by making use of the facility to be eroded. In these circumstances, it is likely
best information available, seeking to build on fact that the Group would need to renegotiate the terms
rather than intuition and developing a professional, of the facility and that this will have an impact on the
rigorous methodology. cost of borrowing. The Directors have considered the
action the syndicate banks may take in such a scenario
and, having taken external advice on the matter,
concluded that it is highly likely that the banks will
agree to renegotiate the facility.
Pictured
01 State-of-the-art lighting. Liquid,
Colchester.
02 Inspiring surroundings at Head Office,

01 02 Milton Keynes.
15
Business Review
Governance
On this basis, having examined evidence and made Health and safety “at luminar WE
appropriate enquiries, the Directors are satisfied Health and safety is taken very seriously by the Group, ARE committed
that adequate financial resources are available to the as detailed in the Corporate Social Responsibility to improving
Group within circumstances that can be reasonably statement. The risk of non-compliance with our product and
foreseen. health and safety legislation is minimised through ensuring that
comprehensive training and an active in-house team, our clubs are
High proportion of fixed overheads and variable who regularly carry out health and safety audits fashionable and
revenues and review and develop policies and procedures to relevant for our
A significant proportion of the Group’s cost base maintain standards. Furthermore, the Group carries customers.”
remains relatively constant, notwithstanding changes substantial public and employer’s liability insurance
to the level of revenues, and therefore any significant cover, in order to minimise the financial impact of any
changes in the level of the Group’s revenues could claim that might arise as a consequence of a failure in
significantly affect the level of earnings and cash flows. health and safety regulatory compliance.
Significant progress has been made in simplifying Failure of internal control regarding frauds and thefts
and reducing the Head Office fixed cost base and this The Group is vulnerable to the conventional
remains an area of focus going forward. financial threats faced by all businesses. Finance
and Operations management continue to review,
Failure to ensure brands evolve in relation to changes
challenge and improve many processes and controls.
in consumer taste
This process is backed up by internal audit covering
The market in which the Group operates is subject
both Head Office administration/accounting and the
to changes in fashions and trends and the Group
operating units.
is exposed to the risk that its innovations in venue
format and content do not keep up with changes in External risks
consumer tastes. Therefore, the Group continues to Interest rate movements
monitor closely changes in the marketplace so that Interest rate risk is being predominantly managed
it can adapt its offering to protect and secure its through swapping between floating rate debt and
revenues. fixed rate debt. This has being achieved through the
purchase of a £50.0m five year fixed rate swap ending
Major fire
August 2012, a £40.0m seven year fixed rate swap
The business has suffered from three major fires with
ending August 2014 and a £50.0m cap and floor swap.
the last being in 2005. This resulted in the destruction
and closure of the clubs concerned. Therefore, fire Loss of licences
prevention and fire safety are taken very seriously in The Group has a dedicated and experienced licensing
staff training and internal health and safety reviews. manager who monitors all licensing related matters
The Group introduced specific training for all venues and works closely with the operations management
in the form of a dedicated ‘fire safety week’, which team, local licensing authorities and local police. This
aimed to ensure that best practice was maintained is backed up with centralised incident reporting and
throughout the Group. Following the substantial follow-up, including liaison with licensing authorities
reduction agreed in 2008 to the excess payable by the for early warning of potential issues. The Company
Group on any one incident, the financial risk posed by also has access to specialist external licensing solicitors
any major fires that might be suffered in the future has who provide additional advice as and when required.
been significantly reduced.
Every effort is made to ensure that managers and
supervisors are fully conversant with current licensing
legislation and their responsibilities under it.
16
Uncertainties clubs under short leaseholds, which are subject to

Economic downturn regular rent reviews. These rent reviews could either
The principal risk facing the Group is that of significantly increase or decrease the level of the
continued or worsening economic uncertainty, Group’s fixed cost base, which could in turn affect the luminar trades
particularly as it may affect young people. Whilst there economic viability of any of the Group’s venues. 87 nightclubs,
is some evidence at national level that conditions are 20 of which are
improving, recovery remains fragile and there is less The Group also held 20 freeholds and 6 long freehold owned
evidence that it has yet impacted our core market. leaseholds as at 25 February 2010. Therefore, any and a further 6
changes to the UK property market could lead to held under long
Should the spending propensity of young people changes in the value of the Group’s property portfolio. leaseholds.
reduce further, there is a risk that the Group’s However, the market value of the Group’s properties
profitability could worsen to the extent that we are continues to be significantly greater than net book
no longer able to meet the requirements placed upon value, despite the recent downturn in the commercial
us by our current lenders. The Board has considered property market.
this carefully and have concluded that it is highly likely
that the banks will agree to renegotiate the facility, if The total number of trading clubs is lower than the
required. total number of leasehold and freehold properties
held by the Group. This is due to the fact that some
Seasonality and weather clubs which are combined to trade as multi-venue
The number of admissions in the Group’s venues sites may have individual title deeds and also due
is considerably increased during holiday periods, to the inclusion of venues in development and
especially Christmas and New Year, and over bank sub-let venues.
holiday periods. Similarly, the admissions and revenue
levels are generally lower in the early months of the Terrorism
calendar year and over the summer compared to In common with many businesses, the Group’s
during the autumn and spring periods. The Group’s revenues are vulnerable to disruption from acts of
revenues can also be adversely impacted by extremes terrorism. Current planning assumes no change in
of weather conditions, which could deter customers the existing level of threat. The Company’s Training
from visiting the Group’s venues. Current planning Department has issued specific documentation based
assumes average seasonal weather conditions. on Home Office guidance to ensure that employees
are aware of these issues and what to look out for. In
Fluctuations in the commercial property market addition, the Company purchases a specific insurance
At the year end, the Group held 62 of its trading policy to cover risks from terrorist activities.
01
17
Business Review
Governance
Our People
are our most
valuable
asset
Graduates from How we invest in our people

foundation degree
Management Development Programme Crew Development Programme
156 2009/10 continued the previous year’s

success in developing our support
2009/10 again saw successful training and
development with the crew members
managers within our clubs. A further 55 in our clubs. With 35% of current crew
managers graduated with the Foundation members having embarked on training
National Training Degree in Leadership and Management levels, which are designed to train the crew
Awards won (Late Night Entertainment), which is members beyond being just competent
accredited by the Nottingham Trent and create the managers for the future.
3 University.
The Foundation Degree Programme,
Crew
Crew are the customer facing staff at our
run in collaboration with Aspire at
clubs and it is important that they are
Loughborough College, won a total of
retained and engaged. Crew turnover is
three National Training Awards in 2009.
carefully monitored and from a starting
A regional and UK award, followed by
position at some 220% Moving Annual
becoming “Winner of the Year” in the
Total (“MAT”), at the end of 2009/10 year
Partnership and Collaboration category.
it had reduced to 118% MAT.
BA (Hons) Degree Programme
Crew Initiatives
2009/2010 saw the continuation of
These range from “Crew Room Challenges”
the top up training programme for
to “Employee of the Month” schemes,
General Managers, with another cohort
“How well am I doing” feedback sessions
of 12 managers being enrolled on the
and rewards for mystery customer
programme. Progress has been made
feedback.
with all the managers currently on the
programme and we expect to see some
graduates of the BA (Hons) Degree in
Leadership and Management (Late Night
Entertainment), which is also accredited
by Nottingham Trent University, within
the next couple of years.
Pictured
01 Liquid, Colchester.
18
Financial review
The total revenue and profitability generated by the Group is detailed below:
Total operations
Revenue† EBITDA*† PBT*†
2010 2009 2010 2009 2010 2009
£m £m £m £m £m £m
Continuing 173.1 193.2 34.3 51.3 4.4 20.3
Discontinued 0.5 1.4 (0.6) (0.2) (0.7) (0.3) robert mcdonald
Total 173.6 194.6 33.7 51.1 3.7 20.0 finance director
† Includes clubs disposed of during the year

* Pre-exceptional items
Presentation of financial results is focused on the impairment review has also impacted the accounts of “luminar continues
continuing business, which includes all our current the parent Company, reducing distributable reserves to be cash
trading operations and principally only excludes to £28.4m. generative, strong
our investment in 3DE and the residue of the major cost control has
Discontinued operations contributed a post-tax loss
disposal to Cavendish Bars in February 2008, the last been exercised
of £0.4m plus exceptional costs of £23.5m. The main
part of which completed in May 2009. during the year and
element of the exceptional cost was a full provision of
borrowings have
Earnings before interest, tax, depreciation and £27.3m taken against our outstanding investment and
been significantly
amortisation (“EBITDA”) from continuing operations receivables from 3DE, which went into administration
reduced.”
before exceptional items totalled £34.3m in the year on 26 February 2010. It is too early to say what
ended 25 February 2010, £17m (or 33%) below the recovery, if any, will be achievable on this debt.
previous year due principally to lower admissions However, the contingent liability previously carried
to our clubs. Depreciation and amortisation of to cover a loan guarantee provided to 3DE is now
£22.7m was level (2009: £22.7m) as the investment considered unnecessary.
programme reduced significantly. Net interest costs
reduced to £7.2m (2009: £8.3m) due to lower debt The Group continues to be cash generative, with a
levels and interest rates, and despite libor on £140m net cash inflow after exceptional items and investing
of debt being hedged to fixed rate. Net interest costs activities of £13.7m for the year (2009: £7.6m). Control
increased from the mid point of the financial year as and reduction of expenditure has been strong during
we provided against potential non-receipt of interest the year, with capital expenditure lowered to £4.2m
on the 3DE loan note, effectively increasing our net (2009: £38.1m) in response to the general economic
interest costs in the second half by £0.9m. climate.
Profit before tax from continuing operations before In August 2009 the Group completed a successful
equity raise of £35.7m (net of costs). The primary
exceptional items was £4.4m (2009: £20.3m) and a the group
purpose of raising the cash was to expand the estate
taxation credit of £0.7m (2009: £4.5m charge) gave completed a
through acquisition and development. However,
rise to profit for the year from continuing operations successful equity
in view of the sudden market deterioration in
before exceptional items of £5.1m (2009: £15.8m). raise of £35.7m in
September, the proceeds of the equity raising have
Earnings per share from continuing operations before the year
exceptional costs were 6.2p (2009: 25.9p). Statutory been retained to reduce net borrowings.
loss from continuing operations after exceptional
Net borrowings have now reduced to £92.6m, a
items was £99.2m (2009: £7.4m profit), giving rise to a
reduction of £49.2m (or 35%) in the year. Gross
loss per share of 120.4p (2009: 12.2p earnings).
borrowings have been lowered by £30m to £140m,
Exceptional items within continuing operations in line with our hedge arrangements, as it is more
totalled a net cost of £104.3m for the year ended economic to hold a high cash balance than to reduce
25 February 2010 (2009: £8.4m). This charge followed borrowings under the loan facility. We have a single
a review of balance sheet values, triggered by lower syndicated loan facility, which runs to August 2012
profits, and the majority related to impairment with a maximum drawdown of £175m and interest
of specific asset values and goodwill. The major costs of up to LIBOR plus 0.75%. We continue to trade
exceptional items contributing to this charge are within covenants tests, with an adjusted net debt to
Pictured
described in note 8 to the accounts attached. The EBITDA ratio of 2.6× for the year ended 25 February
01 Monte Carlo VIP Room, Oceana, Swansea.
02 State-of-the-art lighting rig.
03 DJ at work, pleasing the crowd.

19
Business Review
Governance
01
02 03
20
2010 compared with a covenant maximum of 3.0×. In Currency risk

view of current trading levels, we continue to actively The Group operates within the UK and substantially
monitor our covenants and work together with our all transactions are denominated in sterling, therefore,
lenders to ensure adequate funding resources. the Group does not suffer from a significant
concentration of currency risk.
Our balance sheet includes a current tax liability
of £42.8m (2009: £42.7m) in respect of amounts Credit risk
potentially due to HMRC for tax years since 2004, Credit risk is managed on a Group basis. Credit risk
which remain under discussion. During the year, we arises from cash and cash equivalents, derivative
received a payment of £2.2m in respect of financial financial instruments and deposits with banks and
year 2004, increasing the net tax creditor. Recent financial institutions, as well as credit exposures to
discussions have increased the certainty of outcome receivables, principally recognised on sales of property
for financial year 2005 and we have reduced our assets and on income received from sub-lets. The
provision accordingly by £2.1m. No additional Group does not have a significant concentration of
provision was required for financial year 2010. credit risk and the majority of the Group’s revenues
are cash based.
In view of current trading, the Group continues to
conserve cash and does not recommend a dividend A vendor loan note of £19.3m (plus accrued interest
payment at the current time. totalling £5.3m) with 3DE is receivable on the earlier
of a subsequent sale of the business, refinancing or
Financial risk management
January 2014. At the year end, the loan has been fully
Taxation
provided for as 3DE went into administration on
The current approach of the UK tax authorities
26 February 2010.
means that as a large corporate entity we are subject
to regular tax audits, which by their very nature are Pensions
often complex and take many years to complete. We The Group contributes to a defined contribution
draw a distinction between tax planning for non- pension scheme for qualifying employees. The Group
commercial reasons, and optimising the tax treatment has no exposure to defined benefit pension schemes.
of commercial transactions, and we only enter into tax
planning in respect of the latter. Forward-looking statements
Certain statements in this consolidated financial
Funding and liquidity information for the year ended 25 February 2010
The Group’s cash and debt balances are managed are forward-looking. Although the Group believes
centrally. Liquidity risk is managed through an that the expectations reflected in these forward-
assessment of short, medium and long-term cash flow looking statements are reasonable, it can give no
forecasts to ensure the adequacy of debt facilities. assurance that these expectations will prove to have
been correct. Because these statements involve risks
The Group has positive cash flows from operating
and uncertainties, actual results may differ materially
activities, and the cash balances and undrawn funding
from those expressed or implied by these forward-
are adequate to finance the ongoing working capital
looking statements.
and capital investment requirements of the Group’s
operations. The Group undertakes no obligation to update any
forward-looking statements whether as a result of new
Interest rate risk
information, future events or otherwise.
Interest rate risk is being predominantly managed
through swapping between floating rate debt and
fixed rate debt. This has been achieved through a
£50.0m fixed rate swap, a £40.0m fixed rate swap and
a £50.0m cap and floor swap. At the year end £140.0m
of the bank facility was drawn down, all of which was
hedged.
21
Business Review
Governance
Governance
22
Corporate Social Responsibility
As a listed business, which is also the leader in its Over the last four years we have invested almost “luminar is the
field, we are fully aware of the effect our operations £140m in rebranding, renovating and maintaining our leader in its field
may have on the communities in which we operate. bars and clubs, which lead their market and in many and we recognise
Acting in a socially responsible way is absolutely crucial cases dominate their town or city. As part of this that acting in a
for our business and accordingly, we recognise our investment we have taken measures to ensure better socially responsible
responsibilities towards our customers, employees, accessibility to our venues. For example, in many cases way is absolutely
investors and other stakeholders. We fully appreciate the we have installed low-level bars that allow ease of crucial for our
benefits of operating in an ethical and responsible way. access for wheelchair users and assist us in complying business. We
with the Disability Discrimination legislation. fully appreciate
With the ever increasing focus on Corporate Social
the benefits of
Responsibility (“CSR”), we are aware that companies As stated previously, in building and refurbishing our
operating in
that operate to a high ethical standard are becoming venues we have accommodated the requirements
an ethical and
more attractive to investors. We also strongly believe of a variety of different legislation or regulation.
responsible way.”
that ethically minded companies that care about the This includes Part L2 of the Building Regulations
future are likely to be more determined to succeed 2006, which states that new buildings must be
and prosper. We are therefore proud and delighted tested for air-tightness and requires architects,
to announce that this year we were added as a new engineers and contractors to create a more sustainably
member of the FTSE4Good index, which is a clear built environment.
demonstration that we take our CSR responsibilities
extremely seriously. We have evaluated the implications for our new
developments and adjusted our procedures to
Ever since Luminar was formed, we have faced focus on energy usage and thermal efficiency. For
challenges from economic, social and legislative example, although we install a high percentage of
changes and we have seen each change as a new LED lighting, many areas are also fitted with low
opportunity for our business. Thanks to the efforts energy lighting. Equally, our heating and ventilation
of our Directors and employees, who are the most systems are installed with improved controls that will
experienced operational management in our industry, in turn improve the overall efficiency of our clubs.
we have been able to maintain our position as the Wherever refurbishments are planned, we either
leading operator in our sector. apply a new approach on energy or introduce a
phased replacement of our existing systems. We also
Since 2007, we have produced each year a separate continually evaluate the use of cheaper man-made
CSR Report and this is published on our website materials and/or those materials that can be obtained
located at www.luminar.co.uk/investors. Set out from renewable resources.
below is a brief summary of that report.
Smoking
CSR AND OUR VENUES
The smoking ban was brought into force in England
As far as CSR is concerned we categorise our business
on 1 July 2007. We have welcomed this legislation and
in two ways. The first relates to our venues and the
addressed our trading procedures accordingly. We
second to the events or ‘sessions’ which we stage in
used our earlier experiences in Scotland and Wales
those venues. In a typical year we would expect to run
to prepare fully for this change and we spent around
around 20,000 sessions.
£5m to create designated smoking terraces across
Our main branded venues are Oceana, Liquid and the vast majority of our estate. With the benefit of
Lava & Ignite. Our event or session brands include Big several years’ trading under this new legislation, our
Night Out, Vibe, Red Carpet Moments and UK Club experience is that Luminar will benefit from these
Culture (“UKCC”). regulations because the absence of smoking inside has
meant that we will not have to refurbish our clubs so
regularly and this will help the business save money in
the future.
Pictured
01 Enjoy a private booth at Liquid, Basildon.
02 DJ spinning some tunes.
03 Creating safer clubs.

23
Business Review
Governance
01
02 03
24
Corporate Social Responsibility (continued)
Creating Safer Clubs operational staff with respect to safety matters such as
All venues that have undergone a full refurbishment compliance with fire safety regulations in particular.
over the last few years have received an upgrade to
their CCTV system. This has protected our venues, Polycarbonates and Toughened Glassware luminar has
our employees and our customers. These systems are During the period 2002 to 2007, the number of invested £140m
linked to the intruder alarm and operate 24 hours a non-fatal injuries to members of the public reported over four years,
day. This prevents individuals, such as those who have by the services industry increased by 39% (source creating safer,
been refused admission for reasons of inappropriate www.hse.gov.uk). In response to this, we introduced more customer-
conduct or after being detected with illegal substances polycarbonate plastic into some of our venues on a friendly venues
on their person, from gaining entry to the premises. trial basis. These trials were successful and as a result
In addition, all our venues have at least one mobile we undertook a review of our estate and introduced
‘headcam’ system in use, which provides additional polycarbonates, where appropriate, in our other
support to the fixed CCTV systems and helps us to clubs. In our 2007/8 CSR Report, we noted that
record incidents that occur outside of the coverage following the introduction of increased levels of either
of those fixed systems. In the financial year ended polycarbonate plastic or toughened glass into our
2009, Luminar had invested over £2.7m in intruder licensed premises, we had seen a large reduction in
alarms, ‘headcams’, metal detection and CCTV record the number of incidents and injuries involving broken
and capture equipment. Now that this has been glass. In the year to January 2009, the number of
done it is expected that we will only have to supply recorded glass-related incidents continued to reduce,
some replacements and conduct normal repairs and albeit at a slower rate than we had seen initially.
maintenance going forward. In the year ended 2010,
Although Luminar has now introduced either
we invested £0.3m on intruder alarms and CCTV.
polycarbonate or toughened glass in the vast majority
Lite Patrol of its clubs, since many of our customers prefer to
We are extremely conscious that since our venues can drink out of glassware it is not always suitable to have
accommodate many customers, incidents or hazards polycarbonate plastic throughout. This being the
may occur. To monitor these incidents and ensure that case we continue to monitor the rate of glass related
they are reported and resolved or cleared up as soon incidents, to ensure that we can reconcile supporting
as possible we utilise a safety system known as ‘Lite our customers’ preferences, whilst endeavoring to luminar is now a
Patrol’. This system enables reports to be made at each keep our clubs as safe as possible. proud member of
venue and downloaded to a centralised system where the ftse4good index
Licensing
software evaluates the data so that accurate ‘Incident
In order to be able to sell alcohol and stage certain
Reports’ can be produced. This system is also used to
activities in our venues, we need to obtain the correct
ensure that we can comply with our obligations under
permissions or ‘licenses’ from the relevant authorities.
the Reporting of Injuries Diseases and Dangerous
Obtaining and keeping these licenses is essential for
Occurrences Regulations 1995 (“RIDDOR”) and are
our business and so it is of the utmost importance for
able to submit RIDDOR reports to the Health and
us to monitor all relevant licensing legislation vigilantly.
Safety Executive and/or the local Environmental
Health Authorities when necessary. The licensing of bars and clubs in England and Wales
is now governed by the Licensing Act (2003) (the
Health and Safety
“Licensing Act”), which took effect in November 2005.
We recognise that the health and safety of our
The Licensing Act sets out four licensing objectives,
customers, employees, contractors and local
which are: protecting children from harm; preventing
communities is critical to our success and so, in
crime and disorder; preventing public nuisance; and
order to promote the highest standards of safety
maintaining public safety. We fully understand the
throughout our business, we ensure that all our
importance of these objectives and so we embrace
employees undergo appropriate training. Our Health
them in all in our operations. We continually seek
and Safety Team conduct ongoing reviews and audits
to enhance these licenses by applying for variations
of all our policies and procedures and work with
and better conditions under which to trade. We also
our Training Department to ensure that the training
operated venues in Scotland and the Channels Islands
delivered to our employees is relevant, up to date
during the period and we are aware of the variations
and follows best practice. Further to this, all of our
in their licensing legislation. We monitor and respond
venues receive a full audit from our employed Safety
regularly to their requirements so that our business
Advisor, who provides valuable support to all of our
complies properly with all developments.
Pictured
01 Hanging out with friends.
25
Business Review
Governance
01
CSR AND OUR CUSTOMERS’ EXPERIENCE Customer Security

Although providing leading venues is one aspect We employ the services of third party door stewarding
that allows us to ensure that our customers can companies whose staff look after our customers’
enjoy themselves in a safe and secure environment, welfare both inside and outside our venues. Their staff
we recognise that there are other elements that are trained to be pro-active in: recognising potential
contribute to an enjoyable night out. One of these incidents; identifying vulnerable individuals; and
is our customers themselves and so they are rightly providing assistance where necessary. Outside, they
placed at the heart of our business. Attracting and are responsible for issues such as preventing weapons
retaining customers is one of the key ingredients to or illegal substances being taken into a venue and
our success. The majority of our customers are 18 to they achieve this by the undertaking of random
24 year-olds and they want to enjoy themselves in searches on customers. Inside, the door stewards are
safe and comfortable surroundings. We constantly responsible for ensuring effective queue management,
strive to anticipate their changing demands by maintaining order should the need arise and at the
evolving and redesigning our venues so that they can end of an evening’s trading, the controlled dispersal
accommodate our suite of products that have been of our customers. These measures are designed
developed to meet our customers’ aspirations for the to control behaviour and minimise disruption to
best in entertainment and service. residents. Getting this right every night we trade
is a top priority as it limits any negative impact
Dancesafe our operations might have on their surrounding
While we make every effort to ensure the safety and communities.
welfare of our customers and staff within our venues,
we also encourage our customers to take a level of
responsibility for themselves. We display signage
about customer and staff welfare that advises them
of certain risks to which they could be exposed. We
call this ‘Dancesafe’ and these signs and policies deal
with matters such as responsible drinking and getting
home safely at the end of an evening out.
26
The provision of door security is now a licensed and Customer Relations “the majority of
regulated industry. The legal responsibility for the Although we recognise that our customers visit us our customers
licensing of Door Supervisors rests with the Security to enjoy themselves within our venues, there may are 18 to 24 year
Industry Authority, which was established by the occasionally be times when they do not feel totally olds and we are
Private Security Industry Act 2001. The conduct of satisfied and wish to make us aware of their concerns. committed to
Door Supervisors is also regulated by British Standard We take all such customer issues extremely seriously ensuring they enjoy
BS7960 and it is this which we have used to form and pride ourselves on the prompt and efficient themselves in safe
the basis of our own ‘Service Level Standards’ and manner in which they are addressed. We investigate and comfortable
‘Incident Management Protocols’. We constantly all incidents within a timely period and resolve them surroundings.”
review and develop these Standards and Protocols to wherever possible to the complete satisfaction of
further improve security in our venues. We believe this the customer. We keep records of these incidents
approach enables us to continue to drive forward the and often take remedial action to address the causes
highest standards of excellence in the security. of dissatisfaction and so prevent any recurrence.
Overall complaint levels are monitored and trends are
In addition to our work with door stewarding recorded to identify where additional investigation
companies, we have also engaged with a supplier that and consequently curative attention is required.
provides dogs and their handlers who are specifically
trained in the detection of illegal substances. All LEADING ON SOCIAL ISSUES
our venues receive searches from representatives Industry Associations
of this company and the aim is to ensure that our During the year we became a member of our industry
clubs receive a higher level of protection against the body known as NOCTIS. This is a relatively newly
presence of illegal substances than would otherwise formed association which has taken over the role
be the case. that used to be performed by an organisation known
as BEDA. We consider that in view of the significant
Customer Service and Satisfaction political and legislative challenges facing our industry
Providing great service for our customers starts it is essential that we work with and through NOCTIS
with our employees and we train them to achieve because it deals closely with a number of Government
the highest standards in this regard. It is our policy departments as well as stakeholders (both national
to provide each new employee with the necessary and local) so that it can present as strong a
training to enable them to deliver the highest levels business case as possible for the late night industry.
of customer service and to ensure these levels are Unfortunately, a number of legislators still hold
maintained throughout our business. We survey our negative views about our sector and we believe that
customers to ensure we fully understand what they through NOCTIS, we will be able to develop effective
want and that we are able to deliver this. We monitor strategies to combat those misconceptions and lobby
the performance of our employees in providing great for better conditions which will benefit both our
customer service through means of league tables business and our customers. For example, the ongoing
and reward incentives. We have also enlisted the and well-publicised issue of alcohol pricing by the
services of ‘Retail Eyes’, which is a customer service, off-trade, particularly by the national supermarket
research, development and evaluation agency. We chains, remains an area of significant concern for all
have established the ‘Beyond Hello’ programme, in our industry. We consider that their current pricing
which helps us gather customer feedback, learn from strategies are difficult to reconcile with a wider health
it and adapt our products to ensure we remain at the agenda relating to reducing alcohol consumption and
forefront of our industry. are at odds with our industry which aims to sell and
serve alcohol in a responsible way.
We also note the recent establishment of the

‘Mandatory Conditions’ that were introduced in
April 2010 and while we are fully supportive of
these, we also recognise that the interpretation and
implementation of them may vary significantly up and
down the country. Therefore, in addition to our own
work with local licensing authorities, we will use our
membership of NOCTIS to gain greater clarification
and understanding of these new laws and how they
can best be implemented for the benefit of our
customers.
Pictured
01 A selection of branded products are
available at all our clubs.
27
Business Review
Governance
01
Binge drinking and responsible retailing The Next Generation

We recognise that alcohol misuse and binge drinking Although under-age drinking continues to be a
are important issues, not just for our industry but problem for our society, we recognise that teenagers
also for society at large. Our employees are well still wish to go out to nightclubs as this remains one of
positioned to influence the attitudes and behaviours the experiences you cannot recreate at home.
of customers and are, therefore, trained to identify
those who they consider might exceed a safe and To respond to this demand we have created UKCC,
responsible alcoholic intake. Where they deem it which provides the opportunity for young people
appropriate, they will refuse to serve any customer to enjoy music and dancing in our venues, without
whom they consider has consumed enough. having access to alcohol or other illegal substances.
Under-age drinking and misuse of identification UKCC provides a credible clubbing experience for
Under-age drinking, regrettably, remains a major issue teenagers between the ages of 13 and 17. When
within our society and we continually take steps to staging UKCC events, which are usually held during
prevent under-age persons from entering our venues. the school holidays, we work closely with local Police
The ‘Challenge 21’ scheme, whereby any person and Licensing Authorities to ensure a safe and friendly
who appears under this age is asked to produce environment. UKCC events help to keep youngsters
identification as proof of age, has proved extremely off the streets by giving them an opportunity to enjoy
effective and we will continue to stringently enforce themselves sensibly in our exciting venues. UKCC
this policy. If the identification presented appears to events operate within a well-established framework
have been tampered with, the individual presenting it that has clearly defined policies and procedures.
will be refused entry and excluded from the venue. In These include strict policies for admissions and child
certain cases the police may be called and they may protection. For example, we ensure that there is a
issue on the spot fines, depending on local agreements ‘Designated Child Protection Officer’ at all UKCC
with the authorities. events and we also carry out Criminal Records Bureau
checks on all employees working at them.
28
Our People Following on from 110 graduates last year, we had

The biggest investment we make is in our employees a further 55 support managers graduate in January
because we know that the success of our business is 2010. Thereafter, they may enrol on to the next stage
the responsibility of every individual who works for of the course, which is the top-up Degree. This is a
Luminar. Nearly 3,100 employees currently work at bespoke programme in Late Night Entertainment in
Luminar, the majority of whom are part-time ‘crew’ Leadership and Management and is again validated
members. We believe that it is essential to provide by Nottingham Trent University. As the programme is
an enjoyable, healthy and safe working environment subject to the usual Government funding mechanisms
to ensure that our employees are able to perform at for Vocational Higher Education, there is no cost to
their optimum in what is a highly demanding and fast those who wish to enrol onto it. The programme was
moving workplace. introduced during 2008/9 and will allow our managers
to gain a BA (Hons) degree.
We strive to ensure that our employees feel
appreciated and motivated and we support them in Diversity
all aspects of training and development. To this end, Whilst understanding the need for strong leadership
we have introduced four key values that encapsulate and a strong team ethic, we are also aware that
the work environment we wish to achieve. We individuality is a key component of a great workforce.
encourage our workforce to adopt these values We embrace such diversity and believe that it inspires
and be more: passionate; participative; professional; a versatile and creative thought process throughout
and principled. By promoting these key drivers of the business. At the time of writing this Report our
performance we can instil in our teams the desire to workforce is split almost equally between men and
be the very best at everything we do. women as 49.6% of our employees are female and
50.4% are male.
We strongly believe in promotion from within and
career progression is available to all who join the Noise at Work
Group. We have launched our Crew Development It is a legal obligation on all employers to ensure the
Programme (“CDP”) which covers all aspects of the health safety and welfare of its employees and this now
late night entertainment sector from operations, includes ensuring that they are not exposed to levels
management, licensing legislation and health of noise which could damage their hearing. Therefore, £341,878 raised for
and safety, all the way through to the marketing, in preparation for the Noise at Work Regulations luminar’s charity
promoting and the staging of an actual event. The that took effect on the entertainment industry on echo trust.
CDP demonstrates Luminar’s continued commitment 6 April 2008, we successfully trained all employees
in investing in our people. It also offers clear benefits on the impact of this legislation. Personal Protective
in allowing us to present well-trained, competent and Equipment (in the form of ear plugs) is also provided
motivated crew that have the skills necessary to carry for all employees. In addition, through our involvement
out their jobs to a consistent high standard. with The Royal National Institute for Deaf People,
we have also implemented a health surveillance
We continue the emphasis placed on the training programme to assess and monitor the affect of noise
and development of our employees through our on our employees.
Foundation Degree, which is validated by Nottingham
Trent University. This programme is in its fifth year CHARITABLE ACTIVITIES
and enables an employee not only to embark upon a The Echo Trust
career path but also to link into the academic system To ensure we are able to contribute to the
and gain a highly regarded qualification, which is communities in which we operate, Luminar
recognised worldwide. established its own charity, the Echo Trust, in 2002.
Echo’s main aim is to benefit children’s charities across
the UK and since it was established, it has raised a
huge amount of money for children’s projects.
More recently, during the year a total of £341,878

(2009: £367,178) was donated to Echo by our
customers and staff. This money was raised from
collections within venues and donations made at
Luminar organised events.
29
Business Review
Governance
The main fund-raising events in the year were the THE ENVIRONMENT
‘Give a Kid a Quid’ campaigns, which encouraged Luminar strives to minimise any adverse effects its
customers to simply donate £1. This campaign is activities may have on the environment and we have
the largest contributor in achieving the amounts taken various measures to ensure this continues. luminar employs
referred to above and many charities will benefit from We have set ourselves stretching targets to ensure 3,100 people
grants as a result. These include: East Sussex Hospital that we pro-actively monitor, manage and minimise
(Friston Ward) (£2,400 — raised by Kings Nightclub, such effects.
Eastbourne); the Harley Slack Fund (£286 — raised by
Strata, Skipton); Bliss Premature Baby Charity (£118 — We place our environmental strategy as a high priority in
raised by Lava & Ignite, Burnley); The Christie Appeal all areas of our business and consider our targets when
(£311 — raised by Liquid, Oldham); and Help for engaging in new contracts. These targets reflect our view
Heroes (£1,634 — raised by Liquid & Envy, Wrexham, on ‘green’ issues and our commitment to growing our
Liquid & Envy, Rotherham and Lava & Ignite, Burnley). business in an environmentally friendly manner.
Additional information on our charity, including fuller As part of this strategy, we aim to: comply with all
details of many of the organisations that have received environmental legal requirements and regulations;
grants from it, can be found at www.echotrust.org. monitor and quantify the environmental impact on
our business; define objectives and set improvement
Other Charitable Events targets; promote awareness of relevant environmental
In addition to our venues that support local charities issues amongst employees, customers, suppliers and
within their local communities, a large number of other stakeholders; and verify and publish information
our employees also take part in charitable activities on environmental performance.
that are unconnected to their work at Luminar. They
have recently participated in events such as: the We have focused specifically on improving our
London Marathon 2010; Children in Need; Red Nose performance in regard to waste, Company vehicles
Day; Jeans for Genes; and Wear it Pink (on behalf of and energy management. We monitor our targets
carefully and full details of the targets achieved during 156 managers
Breast Cancer Care). We are extremely proud of them have graduated
for their commitment in giving up their free time to the past year are set out in our full CSR Report located
on our website referred to above. from late night
support these worthwhile causes. entertainment in
BUSINESS RELATIONSHIPS THE FUTURE leadership and
Luminar is a significant business within the We appreciate that operating in an ethical and socially management
entertainment industry and we enter into valuable responsible way is crucial for our business and we foundation degrees
contracts with our suppliers. In running our business it hope that this CSR section sets out a clear view of the
is important that we deal ethically with our suppliers philosophies that underpin our daily activities.
and partners and we expect the same in return.
We are proud of what we have achieved so far but
Our Purchasing Team endeavours to develop mutually we know that none of this would have been possible
beneficial long-term relationships with reliable without the tireless efforts of our people, who deliver
suppliers for goods and services who satisfy our consistently excellent service on a daily basis. They are
requirements in a timely, efficient and cost-effective the best trained and most experienced operators in
manner. We also expect our suppliers to apply a highly the late night sector. We rightly credit them with our
ethical approach in their dealings with Luminar and success and remain confident that we can continue
their own suppliers. to grow our business in the future. To meet these
challenges we aim to introduce new initiatives in
The Purchasing Team also sets objectives and targets 2010/11, such as undertaking work to ensure that
with our suppliers to ensure that we can continually we comply with our obligations under the Carbon
meet these high standards. These include: a structured Reduction Commitment scheme that is being
project plan, targeting the high spend areas; improved established in the United Kingdom and ensuring
supplier assessment and contract monitoring that we develop better strategies to offset our
procedures; auditable files which easily map the carbon emissions.
processes we conduct; and revision of the Luminar
purchasing policy, including the introduction of a
hospitality register.
30
Board of Directors
Board Committees
Nominations Committee
Alan Jackson (Chairman)
Debbie Hewitt
John Jackson
Audit Committee
John Jackson (Chairman)
Debbie Hewitt
Remuneration Committee
Alan Jackson Simon Douglas
Debbie Hewitt (Chairman)
Chairman Chief Executive John Jackson
Robert McDonald Debbie Hewitt

Finance Director Non-Executive Director — Independent
John Jackson John Leach

Non-Executive Director — Independent Non-Executive Director — Independent
31
Business Review
Governance
Alan Jackson Debbie Hewitt

Chairman Non-Executive Director — Independent
Alan was appointed Chairman on 5 December Debbie was appointed to the Board on 14 February
2006. He is also Non-Executive Chairman of The 2007 and chairs the Remuneration Committee.
Restaurant Group plc and Non-Executive Director She is also currently a Non-Executive Director of
of Playtech plc. Alan is also on the board of several Mouchel plc, Domestic and General group, NCC plc,
other non-public companies, including Charles HR Owen plc and HPI Limited.
Wells Limited. He was formerly Managing Director
of the Whitbread restaurant division, where he was She also sits on the Board of the Office of
responsible for the creation and development of Government Commerce, which reports to the UK
the Beefeater, Travel Inns and TGI Friday brands. He Treasury, and the Board of Communities and Local
founded Inn Business Group plc in 1995, which was Government, a Government body which oversees
subsequently acquired by Punch in 1999. He has also all local government activities including planning,
held Non-Executive Directorships in De Vere Group housing and emergency services.
plc and Regent Inns plc
She has previously held a variety of Executive roles,
Simon Douglas including the role of Managing Director of RAC plc,
Chief Executive and was a Non-Executive Director of De Vere Group
plc and The Alumasc Group plc.
Simon joined Luminar and the Board in March
2010. He has previously held various management John Jackson
roles at HMV, Virgin Retail and latterly as CEO in Non-Executive Director — Independent
leading the MBO of Zavvi, where he extracted
John was appointed to the Board on 1 March 2007
considerable shareholder value from the businesses.
and chairs the Audit Committee. He is currently the
Simon has significant expertise in managing multi-
CEO of the Jamie Oliver Group of Companies, and
site, consumer focused, branded entertainment
Senior Non-Executive Director of The Restaurant
businesses.
Group plc and Wilkinson Hardware Ltd. Previously
Robert McDonald he was Executive Director of the Virgin Group,
Finance Director Chief Executive of Semara Holdings plc, Managing
Director of The Body Shop plc, Chairman and
Robert joined Luminar and the Board in March Managing Director of Chesebrough Ponds Limited
2009. He previously spent 25 years working in the and the Senior Non-Executive of Thornton plc
leisure industry with Allied Domecq and with Punch
Taverns plc, where he was Group Finance Director John Leach
for five years, during which time the company Non-Executive Director — Independent
was floated on the London Stock Exchange, made
John was appointed to the Board on 30 April 2010 as
four major acquisitions and reached FTSE 100
a Non-Executive Director. John has wide experience
status. He was also briefly Group Finance Director
of Woolworths Group plc. He is a fellow of the
where from 2003 to 2008 he was involved in various
Chartered Institute of Management Accountants.
roles and latterly as Chief Executive of Hermes Focus
Asset Management Limited. Prior to this he was
Chairman of Orbis plc, Waterhall Group plc and
Brent Walker Group, where he was Chief Executive
and Finance Director from 1994 to 1998 and Group
Finance Director from 1991 to 1994.
32
Corporate Governance Statement
Application of Principles Including the appointment of Simon Douglas, there

This statement describes how the Group applies the have been various changes to the Board of the
principles contained within the FRC’s Combined Code Company since 25 February 2010. Robert McDonald,
on Corporate Governance (June 2008) (the “Code”) the Finance Director, stepped down from the Board
appended to the Listing Rules of the Financial Services on 31 May 2010. Philip Bowcock is Robert’s successor
Authority available from www.frc.org.uk. and joined the Board from Barratt Developments plc
on 1 June 2010. John Leach joined the Board as a Non-
The Board considers that it currently complies with Executive Director on 30 April 2010. Alan Jackson
the Code save that the provision of D.2.4 of the Code announced that he is stepping down as Chairman at tim o’gorman
states that a company should arrange for notice of the end of his current three-year term of appointment company secretary
the Annual General Meeting and related papers be on 13 July 2010 and John Leach will be appointed as
sent to the shareholders at least 20 working days his successor as of 13 July 2010.
before the meeting. Due to technical difficulties with
“in response to
the production of appropriate photographs, the Details of each Director’s other directorships are
the increasing
Company only provided 18 working days’ notice to disclosed in the Board of Directors information at
regulation of the
its Shareholders for the Annual General Meeting held pages 30 to 31.
late night sector,
on 17 July 2009. This matter of non-compliance was a
we have developed
one-off occurrence The Board is responsible for setting the Group’s robust procedures
strategic direction, the establishment of Group that support
The Board continues to be pro-active in reviewing its policies and internal controls, and the monitoring our business and
practices and effectiveness. of operational performance. It meets regularly deliver the highest
throughout the year and in addition to the routine standards in our
The Board confirms that the business is a going reporting of financial and operational issues, reviews industry.”
concern in accordance with the FRC’s ‘Going Concern each of the trading areas and key functions in detail,
and Liquidity Risk: Guidance for Directors of UK including regular departmental functional reviews.
Companies 2009’ as referred to in the Report of the
Directors. The Board has a schedule of matters specifically
reserved to it for decision and delegates certain
Directors
powers to the Board Committees and to the Executive
At 25 February 2010, the Board consisted of the
Directors collectively and individually. The schedule
Chairman, two Non-Executive Directors and two
of reserved matters is reviewed at least annually by
Executive Directors. The Chairman of the Board is
the Board and presently includes management of
Alan Jackson who joined the Board on 5 December
shareholder communication, annual budgets, strategic
2006. John Jackson is the Senior Independent Non-
plans, approval of major capital expenditure in excess
Executive Director. All Non-Executive Directors,
of £1.0m and significant financing.
except the Chairman, are considered independent
Directors according to the terms of the Code. Alan Packs containing relevant commercial and financial
Jackson, the Chairman, was not deemed independent details are normally provided to all Board members
on appointment due to his remuneration in the week prior to a Board meeting to enable the
arrangements. This was set out in detail in the Annual Directors to consider the issues for discussion and
Report for the year ended 26 February 2009. Stephen to request clarification or additional information.
Thomas was the Chief Executive until he resigned on The Board regularly reviews the type and amount of
1 March 2010. information provided. The Board plans to meet ten
times a year and, in addition, has a further meeting for
Simon Douglas was appointed as Chief Executive on 8
consideration of strategic issues facing the Group. The
March 2010. The Chief Executive is responsible for the
Board also holds additional meetings as appropriate,
executive leadership and co-ordination of the Group’s
to fulfil the ongoing requirements of the business
business activities. The structure of the Board provides
during the year.
a balance whereby no individual or small group can
dominate the Board’s decision-making. All Directors have access to the advice of the
Company Secretary, who is responsible to the Board
for ensuring that procedures are followed. The
appointment and removal of the Company Secretary
is reserved for the consideration of the Board as a
whole. In addition, there is an agreed procedure
for seeking independent professional advice at the
Group’s expense.
33
Business Review
Governance
On appointment to the Board, every Director is Having taken into account the balance of skills and
provided with opportunities for appropriate training experience of the Board, their contribution and level
to enable them to discharge their duties as a Director. of independence, the Board has asked the Non-
In addition to the training provided on induction, Executive Directors to remain for a further three-
the Board has introduced an enhanced procedure year term. Debbie and John are, therefore, offering
for ensuring that the Directors receive training themselves for re-election for a further three-year
on matters that are of particular relevance to the term, a decision that the Shareholders will be asked to
business operations of the Group. These include approve at the forthcoming Annual General Meeting.
presentations on Loss Prevention, Health and Safety For the reasons set out on page 11, Alan has decided
and Licensing, which were specifically tailored to to step down as Chairman at the end of his current
address the industry in which the Group trades. In three-year appointment and will not be offering
addition, further independent training may be sought himself for re-election.
if necessary. The Company creates opportunities for
the Senior Independent Director and Non-Executive The Non-Executive Directors’ contracts are
Directors to meet with significant Shareholders, terminable on three months’ notice on either side.
should this be requested by those Shareholders. The appointment of the Chairman is terminable on
six months’ notice on either side. No compensation
The Board has concluded a review of its effectiveness. is payable on the termination of their service contracts
The conclusions of the review have been discussed by
the Board as a whole and will be kept under review The Board also takes significant measures to ensure
during the forthcoming year. that all Board members are kept aware of both the
views of major Shareholders and changes in the major
During the year ended 25 February 2010, the Non- shareholdings of the Group. This is achieved in a
Executive Directors evaluated the performance of the variety of ways, including:
Chairman and provided him with feedback following
their discussions. The Chairman has also provided full feedback of Shareholder reviews are
feedback to the Non-Executive Directors. communicated by the Chairman, Chief Executive
and Finance Director who are primarily charged
Board members are appointed by the Board on the with meeting Shareholders;
recommendation of the Nominations Committee,
which is chaired by the Chairman and consists of the the Board receives regular feedback from the
Non-Executive Directors, although the Chief Executive Group’s stockbrokers;
is invited to meetings, as appropriate.
changes in current shareholdings are also presented
Article 99 of the Articles of Association requires a to the Board on a regular basis prompting
Director to stand for re-election if they were not discussions on Shareholder issues;
appointed or reappointed at either of the last two
following interim and full year announcements the
Annual General Meetings.
Board receives reports and feedback from analysts
Simon Douglas, John Leach and Philip Bowcock were and Shareholders on a no-names basis;
appointed since the last Annual General Meeting and
significant Shareholder movements are notified to
are offering themselves for election at the forthcoming
the Board by the Company Secretary on an
Annual General Meeting in accordance with the
ad hoc basis;
Articles of Association.
all Directors are invited to analysts’ briefings and
Subject to re-election at the first Annual General
have access, if required, to the Group’s stockbrokers;
Meeting after which they are appointed, all Non-
and
Executive Directors are appointed initially for a three-
year term and after review, will normally be proposed the Board has procedures in place for full
for a further three-year term. Alan Jackson, John agreement for all significant announcements to
Jackson and Debbie Hewitt were each reappointed on the City.
20 July 2007 and therefore the current three-year term
of their appointments will expire at the latest on
20 July 2010.
34
Corporate Governance Statement (continued)
Chairman and Chief Executive — Division of Responsibility

There is a clear division of responsibility between the Chairman and the Chief Executive. The division is in writing
as follows:
The Chairman is responsible for: The Chief Executive is responsible for:
Ensuring that the Board operates effectively Developing, reviewing and executing Group
by ensuring information flows, and facilitating objectives and strategy;
contributions from Non-Executive Directors and
monitoring performance; Developing, reviewing and maintaining effective
organisational structure and optimising the use and
Liaising with the Chief Executive and providing adequacy of the Group’s resources;
support, a sounding board, advice and feedback;
Developing and maintaining effective performance
Supporting the strategic process and encouraging management;
and supporting the Chief Executive with the
development of strategy; Ensuring effective planning and performance
measurement;
Maintaining relations with Executive Directors and
senior managers; Maintaining and enforcing effective internal
controls, regulatory issues and risk management;
Providing feedback to Non-Executive Directors and
encouraging their development and induction; Recruiting and managing senior executives
and managing their contract and performance
Chairing the general meetings and Board meetings issues (subject to Remuneration Committee
and agreeing Board agendas; responsibilities);
Managing any contract issues that may arise Ensuring effective staff policies, succession and
in regard to the Chief Executive, reviewing planning;
and appraising his performance, making
recommendations to the Remuneration Implementation and monitoring of compliance
Committee on the remuneration proposals for the with Board policies and ensuring that all Group
Chief Executive, Executive Directors and the senior policies are followed;
executives;
Maintaining primary relationships with
Ensuring that there are effective processes for Shareholders, possible investors and providers
maintaining relations with investors and, from of debt capital and other stakeholders of the
time to time, attending investor meetings when Company;
appropriate or if requested;
Identifying and executing new business
Supporting Group communications on major opportunities;
issues and fulfilling an ‘ambassadorial role’ when
External and internal communications (in liaison
necessary; and
with the Chairman on major issues); and
Chairing the Nominations Committee and leading
Reliable reporting of the above to the Board.
the recruitment of the Chief Executive and Non-
Executive Directors.
35
Business Review
Governance
Board COMMITTEES
In accordance with the Code and corporate governance best practice, the Board has established a number of
committees. All of the committees have written terms of reference, approved by the Board.
The Board has ten scheduled meetings per year, with other meetings convened for specific matters, some
of which are delegated to other committees, as appropriate. The attendance of each of the Directors at the
scheduled Board and committee meetings (including conference calls and quorum Board meetings), where
appropriate, is shown below:
Number of meetings Audit Remuneration Nominations

in the year Board Committee Committee Committee
Alan Jackson 10 2
Debbie Hewitt 9 3 9 3
John Jackson 8 3 9 3
Stephen Thomas† 10
Nick Beighton§ 1
Robert McDonald‡ 10
† Resigned from the Board on 1 March 2010

‡ Appointed to the Board on 16 March 2009
§ Resigned from the Board on 26 April 2009
The Non-Executive Directors, including the Chairman, During the year ended 25 February 2010, the Group’s
met once in the year ended 25 February 2010. external Auditors, PricewaterhouseCoopers LLP
(“PwC”), provided advice to the Group, including
Audit Committee
advice in relation to the equity fundraising and
The Audit Committee is chaired by John Jackson
tax. The fees paid to PwC for non-audit services
and during the financial year also comprised
were £0.3m (2009: £0.3m) excluding VAT. The
Debbie Hewitt. The terms of reference for the Audit
Audit Committee carefully evaluated the use
Committee provide that the Chairman is invited
of PwC for non-audit work, where appropriate.
to attend all meetings and the Chief Executive and
Non-audit work was led by separate teams, which
Finance Director are invited to attend meetings,
were segregated to the degree required to achieve
as appropriate.
the necessary independence and to maintain the
The terms of reference for the Audit Committee are Auditors’ objectivity. The Audit Committee views the
available from the Company Secretary and also appear independence and objectivity of the Group’s Auditors
on the corporate website at www.luminar.co.uk. as essential and ensures that PwC are not instructed
on any issues, which would prejudice this. To ensure
The Committee meets during the year and reports that this occurs, the Group operates a policy under
to the Board on all matters relating to the regulatory which any non-audit work is subject to competitive
and accounting requirements that may affect the tender and if such work has a value in excess of
Group, together with the financial reporting and £50,000 it is also referred to the Audit Committee
internal control procedures including the annual and for approval. The Audit Committee obtains written
interim financial statements. In addition, the Audit confirmation, where appropriate, on at least an annual
Committee ensures that an objective and professional basis of the independence of the external Auditors.
relationship is maintained with the external Auditors,
with particular regard to the nature and extent of any Following a review by the Audit Committee, the Board
non-audit functions they provide. agreed in April 2010 to recommend to shareholders
at the Annual General Meeting, the reappointment
The external Auditors may attend all meetings of the of the external Auditors for a period of one year.
Audit Committee and have direct access to the Audit The current overall tenure of the external Auditors
Committee and its Chairman at all times. dates from 2003. Any decision to open the external
Auditors to tender is taken on the recommendation
of the Audit Committee, based on the results of the
effectiveness review described below. There are no
contractual obligations that restrict the Company’s
current choice of external Auditors.
36
The Audit Committee assesses the ongoing Nominations Committee

effectiveness of the external Auditors and audit The Nominations Committee is chaired by Alan
process on the basis of meetings and an internal Jackson and also consists of all the Non-Executive
review with finance and other senior executives. In Directors. It monitors and reviews the membership
reviewing the independence of the external Auditors, of and succession to the Board of Directors and
the Audit Committee considers a number of factors. monitors the effectiveness of the Board. If the Board
These include the standing, experience and tenure of requires additional skills, the Nominations Committee
the external Auditors, the nature and level of services has the ability to appoint new or additional
provided and confirmation from the external Auditors Directors or Non-Executive Directors. It makes
that it has complied with relevant UK independence recommendations to the Board, inter alia, on the
standards. identification and recruitment of potential Executive
and Non-Executive Directors. The Nominations
The Audit Committee also reviews the possible risks Committee met three times in the year ended
facing the Group, the risk management function 25 February 2010 to consider the appointments of
and internal controls. The latter are dealt with in Robert McDonald and Simon Douglas.
greater detail below. The Company uses an external
consultancy, Icarus Wyatt Consulting Limited, who The terms of reference for the Nominations
reports to the Finance Director and to the Audit Committee are available from the Company Secretary
Committee and is responsible for ensuring the and also appear on the corporate website at
management of the risk process across the range of www.luminar.co.uk.
the Group’s activities. The external consultant reports
OPERATIONAL STRUCTURE
at least twice a year to the Audit Committee regarding
Senior Executive Management
risk and internal control matters and the full Board
Luminar Leisure Limited provides support services
review risk and internal controls annually.
to the Group’s trading subsidiaries. The Senior
Steps have been taken to ensure that there is an Executive Management (“SEM”) of Luminar Leisure
opportunity for any employee, in confidence, to Limited consists of the two Executive Directors of
raise concerns with management about possible Luminar Group Holdings plc (Simon Douglas and
impropriety in financial or other matters. The Robert McDonald until 31 May 2010 and Simon
Group has established an internal hotline, which is Douglas and Philip Bowcock as of 1 June 2010), the
independent of line management and intends to Group’s Commercial Director (Andy Marks), and
undertake further reviews to increase awareness of support centre administrative function Directors: Liz
the process including training for managers who may Purdy (Human Resources); Peter Turpin (Director
have to deal with whistle-blowing issues. of Operations); Mark Noonan (Marketing and
E-Commerce Director); and Tim O’Gorman (General
The Company has in place internal control and risk Counsel and Company Secretary). The SEM exercises
management systems in relation to the Company’s the day-to-day management function of the Group
financial reporting process and the Group’s process and is supported by other departments within the
for preparation of consolidated accounts which it business, including all operating support functions.
monitors and evaluates on a regular basis.
The SEM considers amongst its standing agenda items:
Remuneration Committee reviewing capital expenditure; revenue expenditure
The Remuneration Committee is chaired by Debbie not authorised by the Executive Directors within their
Hewitt and consists of all the Non-Executive Directors, individual authority levels; regular reports from the
except the Chairman. The Chairman is invited to Directors reviewing the Risk Register and management
attend all meetings. The Remuneration Report is set responses; and a regular review of the strategic aims of
out on pages 40 to 48. the Group.
The terms of reference for the Remuneration

Committee are available from the Company
Secretary and also appear on the corporate website
at www.luminar.co.uk.
Pictured
01 Cool surroundings in the Ice Room,
Reykjavik.
02 Tahiti Bar, Oceana, Swansea.
03 Liquid, Ipswich.
37
Business Review
Governance
01
02 03
38
INTERNAL CONTROL Internal Audit

As stated above, the Board is responsible for the The Group has an Internal Audit Department
ongoing process of identifying and evaluating the that carries out audits to assess various operations
significant risks faced by the Group, both financial and throughout the business. The Internal Audit
non-financial for the purpose of maintaining a sound Department monitors a variety of issues such
system of internal control to safeguard Shareholders’ as health and safety, financial controls in venues
investment and the Company’s assets. This and stock loss. Their work is supported by Icarus
responsibility includes clearly determining the control Wyatt Consulting Limited, the Company’s external
environment and reviewing its effectiveness. However, appointed consultant, which assesses the adequacy
such a system can provide only reasonable and not and effectiveness of internal controls over key
absolute assurance against material misstatement operational and financial risks and reports to the
or loss. Company Secretary. This consultancy firm also
has direct access to the Chairman of the Audit
Approximately every quarter, a paper detailing Committee, as appropriate. The Audit Committee
the register of key risks is submitted to the SEM also ensures that an annual review of the effectiveness
of Luminar Leisure Limited for approval and of the internal audit department is undertaken and
discussion. The SEM is responsible for the day-to- operates in compliance with best practice.
day management of risks within the Group. The
register of key risks covers material controls including Loss Prevention
financial, operational and compliance controls. These The Group has a Loss Prevention Department,
discussions are minuted. Areas of concern within the reporting to the Finance Director, which aims to add
register are highlighted by the Company’s external quantifiable value to the business.
consultant, Icarus Wyatt Consulting Limited. The SEM
is asked to propose any amendments to the register This is achieved by the investigation of committed
that it deems appropriate and to confirm that it is and alleged criminal activity. In addition, the Loss
content that the register presents a true and fair view Prevention Department provide and enforce an
of the key risks facing the business, together with the Anti-Fraud and Anti-Crime culture. There is zero
controls that have been implemented to assess those tolerance of any such activity in all of the venues
risks. Actions relating to certain risks are recorded as and throughout the business. We seek to recover all
necessary. Key issues identified as a result of the risk- losses from criminal and negligent acts through a
based internal audit process are also identified within variety of channels, including the Criminal Courts and
the paper. through Civil Recovery action. The Loss Prevention
Department aims to raise awareness of the risks and
The annual risk-based internal programme is compiled consequences of fraud and crime. All employees are
using the risk register. required at all times to act honestly and with integrity.
The relaunch of the Whistle-blowing telephone
One-to-one meetings are held frequently with risk line supports and reinforces this culture. The line is
owners to discuss key risk issues and meetings are held monitored constantly and all calls are dealt with in a
with the Auditors on an ad hoc basis to discuss risk. timely and appropriate manner.
The effectiveness of the internal control system has The Loss Prevention Department also identifies areas
been reviewed by the Board throughout the year. of potential risk and advises on appropriate methods
The ongoing process for identification, evaluation for removing such risk. It assists in the implementation
and management of significant risks accords with the of any new methods and procedures that have been
Turnbull guidance published on the Internal Control approved. Advice, guidance and support is given
requirements of the Code. at all times to the Operations Management teams
throughout the business.
Assurance in relation to the design, operation and
effectiveness of internal controls across the Group’s
activities and functions is provided through a mix of
mechanisms and processes, which include:
39
Business Review
Governance
Health and Safety Finance

The Group’s Operational Risk department visit the The Finance Director provides regular financial
venues on a regular basis to perform audits and assist information to the Board, which includes key
in the completion of legislative and due diligence performance indicators.
requirements. Compliance performance of individual
venues is benchmarked against the Group’s venues Regular performance review meetings are held
as a whole. Poorly performing venues requiring where management discuss business performance,
additional assistance are offered one-to-one support risks to performance and internal control issues
from the Group’s Health and Safety Advisor to with the Executive Directors.
improve compliance scores.
Public liability
Supporting Health and Safety documentation The Group continues to monitor and pro-actively
provided to all Company venues, including template manage its public liability exposure both by the use
risk assessments and the Group’s Fire, Food and of the ‘Lite Patrol’ system mentioned above and
Health and Safety Guidance Manuals, are updated adopting best practice in the clubs regarding staff
and reviewed on a regular basis by the Group’s Health training and use of its external door supervisors.
and Safety Advisor to ensure all venues trade to meet
The Group maintains appropriate insurance cover
current legislative and best practice requirements.
to address specific and general risks that face the
The Group has adopted and installed a ‘Lite Patrol’ business.
system in all venues. ‘Lite Patrol’ is a computerised
Licensing
system, which acts as an internal control, enables
To ensure that any issues arising from the operation
monitoring of activity and ensures that operational
of the venues are identified, the Group undertakes
standards are as high as possible during trading hours
regular ring rounds of all Councils and police
within the venues. The system ensures the regular
divisions covering the areas in which it operates and
inspection of key areas (which is provided by scanning
liaises extensively with other stakeholders (including
discs mounted in various parts of the unit, usually
local residents’ associations and industry bodies).
by floor supervision) can be proved, monitored and
This process is supported by the use of incident
recorded. The ‘Lite Patrol’ system has proved especially
reports generated by unit management, which are
useful in ensuring the effectiveness of the safe systems
sent to appropriate area managers, management
of work implemented by the Company.
and Executives.
Legislative reform
CCTV
The Group carries out reviews to assess the impact of
The Group makes extensive use of CCTV and
legislative and regulatory change. During the year, the
typically keeps records of CCTV coverage for one
Group continued to review its compliance with a wide
month.
range of new or recently introduced legislation. This
ranges from the changes to licensing laws with the
introduction of Mandatory Conditions (three of these
have already been issued in April and the remaining
two are due in October).
Training
The Group’s Training Department provides specific
training to all employees to ensure high standards
of customer service. Included within this training
are specific modules to enable them to understand
and manage risk in the venues. These procedures are
all embodied in awards available to employees on
satisfactory completion of the training programme.
40
Remuneration Report
The current trading environment has resulted in The Remuneration Committee is responsible for “we are grateful
the Remuneration Committee adopting a change of setting and reviewing the remuneration of the for the hard work
emphasis of its remuneration policy, to shift the costs Chairman, Executive Directors and their direct reports and dedication
of remuneration from a higher level of fixed operating and the operation of any share-based incentive shown by our
costs, to a lower level of fixed remuneration, with a schemes (including all employee schemes). In talented and
potentially higher level of variable pay. determining its policy, the Remuneration Committee very experienced
has regard to the principles and provisions of the Code people, who work
As such, the Remuneration Committee is committed as well as the Listing Rules and associated guidance tirelessly to deliver
to aligning compensation with the returns to on good governance. The Committee operates under a consistently
Shareholders by reducing base salaries but offering a the delegated authority of the Board and its terms of excellent service.”
potentially lucrative upside to Executives through an reference are available from the Company Secretary
attractive annual bonus and long-term incentive plan, on request, and also appear on the corporate website
linked to very substantial shareholder value creation at www.luminar.co.uk.
This Report has been prepared by the Remuneration The Remuneration Committee is able to consider
Committee and has been approved by the Board. It corporate performance on environmental, social
complies with Schedule 8 of the Companies Act 2006 and governance issues when setting remuneration of
(the “Act”), which incorporates the requirements Executive Directors. The Remuneration Committee
of the Large and Medium Sized Companies and is comfortable that the incentive structure for senior
Groups (Accounts and Reports) Regulations 2008, the management does not raise any environmental, social
reporting requirements of the Listing Rules of the UK and governance risks by inadvertently motivating
Financial Services Authority and in accordance with irresponsible behaviour.
the Code. This Report will be put to Shareholders
for approval at the forthcoming Annual General REMUNERATION POLICY
Meeting. The Act requires the Auditors to report on The Remuneration Committee determines the
certain parts of the Report and to state whether, in Group’s policy on the remuneration of the Executive
their opinion, those parts of the Report have been Directors. The principles which underpin the
properly prepared in accordance with the Regulations. remuneration policies for the Group both for the last
The Report has therefore been divided into separate and forthcoming financial year are:
sections for audited and unaudited information.
to ensure that senior Executive rewards and
THE REMUNERATION COMMITTEE incentives are directly aligned with the Group
During the year ended 25 February 2010, the strategy and the interests of the Shareholders, in
Remuneration Committee comprised Debbie order to optimise the performance of the Group
Hewitt (Chair) and John Jackson, both of whom are and create sustained growth in Shareholder value;
independent Non-Executive Directors. The Chairman
(Alan Jackson) is invited to attend Remuneration to provide the level of remuneration required to
Committee meetings. The Remuneration Committee attract, retain and motivate Executive Directors of
also received assistance from the Chief Executive, an appropriate calibre;
the Human Resources Director and the Company
to ensure a proper balance of fixed and variable
Secretary. No individual took part in discussions in
performance related components, linked to
respect of matters relating to their own remuneration.
short and longer-term objectives and to ensure
Hewitt New Bridge Street (“HNBS”), a firm of that Executives are not incentivised to take
independent remuneration consultants, advises the inappropriate risk;
Remuneration Committee as required in relation to
to reflect market competitiveness, taking account
senior executive remuneration and employee share
of the total value of all the benefit components; and
schemes. HNBS has no other connection with the
Group other than the provision of advice on executive to ensure that there is no scope to reward failure.
remuneration. The terms of engagement for HNBS are
available from the Company Secretary, on request.
41
Business Review
Governance
Remuneration for the Executive Directors is structured (c) Long-term incentive plan
so that the variable pay element (annual bonus and Recognising the appointment of a new management
long-term incentives) forms a significant proportion of team and the continued challenging trading
the overall package. Whilst the balance between the conditions, the Remuneration Committee considers
fixed and variable elements varies dependent on the that it is essential to put in place a tailored long-term
performance of both the Group and the individual, incentive arrangement for senior management for
at or above a ‘target’ level of performance, variable achieving the recovery of sales, profit growth, cash
pay accounts for more than 50% of the average generation and share price growth.
total remuneration package for the two Executive
Directors. Details of the proposed new Long-Term Incentive Plan
(“LTIP”) are set out in the Notice of Annual General
INDIVIDUAL ELEMENTS OF REMUNERATION Meeting accompanying this Report.
The main components of the remuneration package
for Executive Directors are as follows: In summary, selected senior management will be
granted options to purchase the Company’s shares
(a) Salary in the future, at a price set at the outset. The total
Salaries for each Executive Director are determined number of shares over which options may be
by the Remuneration Committee taking into account granted under the LTIP equates to 7% of the issued
the experience and performance of the individual share capital as at 8 March 2010 (being the date
and comparisons with peer group companies within of appointment of the Chief Executive). The Chief
its sector. Executive will receive options over 40% of this LTIP
pool and the remainder of the pool will be allocated
Base salaries are reviewed annually (unless
amongst certain senior executives, as determined by
responsibilities change). In setting appropriate salary
the Chief Executive and Remuneration Committee.
levels for the Executive Directors, the Remuneration
Should the full 7% not be allocated throughout the
Committee takes into account pay and employment
period of the scheme, any unallocated options
conditions of employees elsewhere in the Group.
will lapse.
Simon Douglas was appointed as Chief Executive on
The current intention is that, to the extent possible,
8 March 2010, with a base salary of £300,000.
the LTIP options will be satisfied with market-
Robert McDonald was appointed Finance Director on purchased shares.
16 March 2009, with a base salary of £240,000. Robert
The exercise price of the options will be set by
stepped down from the Board on 31 May 2010 and
reference to the share price on 8 March 2010 (other
will remain with the Company until 30 June 2010.
than for HMRC Approved options where the exercise
His salary was not increased during the term of his
price will be set by reference to the share price at the
appointment.
time of grant).
Philip Bowcock was appointed as Finance Director on
The extent to which an option may eventually be
1 June 2010, with a base salary of £200,000.
exercised will depend upon three performance
(b) Annual bonus conditions based on share price, relative total
The annual bonus is designed to drive and reward shareholder return (“TSR”) performance and average
excellent short-term operating performance of the annual ROCE over the performance period.
Group. The maximum bonus opportunity is 100%
Performance will be measured over five years from
of salary. For 2010/11, 100% of potential bonus will
8 March 2010, other than the ROCE (as defined
be based entirely on the profit before tax sliding
below) performance condition which will be
scale, with no payment made unless the annual
measured over five financial years commencing with
budget is achieved. All bonuses for the Executives
the 2010/11 financial year. However, there will be an
are funded out of profit incremental to the budget.
early testing opportunity after three years (see below).
The Remuneration Committee determined that there The performance conditions will be measured in
was no bonus payable to any Executive under the accordance with the three steps set out below. These
scheme for 2009/10. conditions were chosen as they align management
with the creation of shareholder value both absolutely
and relatively.
42
Remuneration Report (continued)
Step 1: share price

The option is subject to a performance condition based on the Company’s share price.
The potential level of vesting of the option under the share price performance condition will be calculated in
accordance with the following table:
End Price % of option that may vest under Step 1

Less than £1.50 0%
Between £1.50 and £2.50 1/7th (i.e. 14.28%)
Between £2.51 and £3.50 2/7ths (i.e. 28.57%)
£6.51 or more 100%
The End Price is the average share price over the three-months immediately preceding 8 March 2015 (rounded
down to the nearest full penny).
Step 2: Relative TSR performance

The option is also subject to a performance condition measuring the Company’s TSR performance against that
of a group of comparator companies over the five-year performance period which commences on 8 March 2010.
The extent to which the part of the option that vests under Step 1 above (the ‘Step 1 vested proportion’) will be
calculated under Step 2 as follows:
TSR performance of the Company against % of “Step 1 vested proportion”

that of the comparator Group that may vest under Step 2
At or above upper quintile 100%
At or above 2nd quintile but below upper quintile 50%
Below 2nd quintile 0%
The TSR comparator group will comprise the For these purposes, ROCE means EBIT (of continuing
following companies: Domino’s Pizza, Enterprise Inns, business pre-exceptional items) in relation to
Fullers, Greene King, JD Wetherspoons, Marstons, total assets less current liabilities. ‘Total assets’ is
M&B, Punch Taverns and Youngs. The Company will defined as net assets plus bank (including finance
be included in the comparator group for the purposes leases) debt less cash. Any asset write downs will be
of assessing the TSR performance condition. added back to net assets unless the Remuneration
Committee considers it appropriate not to do so. The
For these purposes, for the Company and each other Remuneration Committee may determine whether
member of the comparator group, the TSR over exceptional items, negative or positive, are included or
the last three months of the performance period excluded.
will be compared to the TSR over the three months
immediately preceding the start of the performance The performance conditions will be measured over
period. a five year period commencing 8 March 2010 (other
than the ROCE condition which will be measured
Step 3: ROCE over five financial years commencing with the
Notwithstanding the satisfaction of the performance 2010/11 financial year). To the extent that any of the
conditions under Steps 1 and 2 above, the option will performance conditions are met after three years,
not vest unless the average annual Return on Capital the option may vest at that time. However, only 50%
Employed (“ROCE”) over the five financial years of any vested option may be exercised after three
commencing with the 2010/11 financial year is 8% years. The remaining 50% of the vested option will
or more. be ‘banked’ and will only become exercisable at the
end of the full five-year period (provided that the
participant remains in employment at that time).
43
Business Review
Governance
Any part of the option which did not vest after COMPENSATION PAYMENTS TO
three years will remain subject to the performance DEPARTING EXECUTIVE DirectorS
conditions which will be assessed over the full five- From the date of cessation of employment (31 July
year performance period. 2010), Stephen Thomas will receive an amount
equivalent to 12 months’ salary, benefits and pension.
The Remuneration Committee considers that the LTIP He will participate in the 2010/11 bonus plan on a
is an essential incentive tool at this stage, to provide pro rata basis for the proportion of the financial year
a focused incentive to achieve the recovery of the worked.
Company in the current trading conditions.
Nick Beighton received salary, benefits and pension
In future years, the intention is to return to a normal up until the date of his cessation of employment
annual grant policy under the existing Luminar Group (26 April 2009). He received no compensation for loss
Holdings 2007 Performance Share Plan. of office. Since he left shortly after the start of the new
financial year, it was determined that he would not be
(d) Shareholding guidelines
eligible to participate in the annual bonus plan for the
Executive Directors and other senior Executives who
2009/10 financial year.
will participate in the LTIP will be expected to build a
shareholding in the Company, to the value of 50% of Robert McDonald will receive salary, benefits and
their salary within three years of the adoption of the pension up until the date that his employment
LTIP and 100% of their salary within five years of the ceases (30 June 2010). Robert will not receive any
adoption of the LTIP. compensation for loss of office and further, as he will
leave the Company shortly after the start of the new
(e) Pension entitlements
financial year, he will not be eligible to participate in
The Remuneration Committee’s policy is to offer
the annual bonus plan for the 2010/11 financial year.
senior Executives a salary supplement in lieu of a
pension provision. Simon Douglas and Philip Bowcock EXTERNAL DirectorSHIPS FOR
will receive a salary supplement of 20% and 15% of EXECUTIVE DirectorS
salary respectively. The Executive Directors can, at the discretion of the
Board, be appointed as a Non-Executive Director
EXECUTIVE DirectorS’ SERVICE at other companies. Before granting permission
CONTRACTS
the Board will take into account, inter alia, the time
The Remuneration Committee’s policy is to offer
commitment of the new role, the competitive status
service contracts with notice periods of 12 months
of the other company, the Listing Rules and the Code.
or less.
Stephen Thomas is a Non-Executive Director of The
Simon Douglas’ service contract (dated 8 March 2010)
3D Entertainment Group Limited and Non-Executive
is terminable on 12 months’ notice by the Company
Chairman of Legion Group plc and retained fees
and on six months’ notice by him. Robert McDonald’s
paid to him during the period from October 2009 to
service contract (dated 16 March 2009) and Philip
December 2009 of £12,499. He is also a Non-Executive
Bowcock’s service contract (dated 13 May 2010) are
Director of Saracens Limited, Premier Team Holdings
both terminable on six months’ notice by either party.
Limited and a Trustee of the Royal National Institute
Stephen Thomas’s service contract (dated 28 January for Deaf People. Stephen Thomas ceased to be a
2008) was terminable on 12 months’ notice by either Director of the Company on 1 March 2010.
party. Nick Beighton’s service contract (dated 1 August
Nick Beighton acted as Non-Executive Director of The
2005) was terminable on six months’ notice by either
3D Entertainment Group Limited until 17 March 2009.
party.
Nick Beighton ceased to be a Director of the Company
Upon termination, the Executive Directors are on 26 April 2009.
entitled to salary and benefits for the duration of the
Both Stephen Thomas’s and Nick Beighton’s fees
notice period. It is the policy of the Remuneration
for being Non-Executive Directors of The 3D
Committee to seek to mitigate termination payments.
Entertainment Group Limited are due to be paid to
From the date of termination, Simon Douglas is
the Group.
subject to a 12 month non-compete clause and Philip
Bowcock and Robert McDonald to a six month non- Neither Simon Douglas, Robert McDonald nor Philip
compete clause. The Executive Directors are employed Bowcock holds any Non-Executive Directorships in
on rolling contracts with a retirement age of 65. other companies.
44
Non-Executive DirectorS
All Non-Executive Directors are appointed initially for a three-year term and, after review, will normally be
proposed for a further three-year term. The current three-year term of Alan Jackson, John Jackson and Debbie
Hewitt expires this year. Having taken into account the balance of skills and experience of the Board, their
contribution and level of independence, the Board has asked the three Non-Executive Directors to remain for a
further three-year term, subject to Shareholder approval at the forthcoming Annual General Meeting. Debbie
and John are, therefore, offering themselves for re-election for a further three-year term. Alan has decided to
step down as Chairman at the end of his current three-year appointment and will not be offering himself for re-
election. None of the Non-Executive Directors will have any unexpired term remaining on their service contracts
at the time of their re-election.
Non-Executive Directors’ appointments are terminable on three months’ notice on either side, save in respect of
Alan Jackson whose appointment as Chairman is terminable on six months’ notice on either side.
Details of their current three year appointments are as follows:
Appointment date
Alan Jackson 5 December 2006
Debbie Hewitt 14 February 2007
John Jackson 1 March 2007
John Leach 30 April 2010
Non-Executive Directors are not entitled to bonus payments or pension arrangements, nor do they ordinarily
participate in the Group’s long-term incentive schemes. Fees for the Non-Executive Directors are determined by
the Board in accordance with the Articles of Association and are based on information on fees paid in similar
companies, taking into account the experience of the individuals and the relative time commitments involved.
TOTAL Shareholder RETURN GRAPH

Reproduced below is a line graph indicating the TSR (calculated in accordance with Schedule 8 of the Large
and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008) for a shareholding in the
Company (and before 19 October 2007, Luminar plc, the previous holding company of the Luminar Group) and
a notional shareholding in the FTSE SmallCap Index:
200
Luminar
150 FTSE SmallCap
Value (£)
100
50
0
27 Feb 05 2 Mar 06 1 Mar 07 28 Feb 08 26 Feb 09 25 Feb 10
This graph shows the value, by 25 February 2010, of £100 invested in Luminar Group Holdings
plc on 27 February 2005 compared with the value of £100 invested in the FTSE SmallCap
Index. The other points are the values at intervening financial year ends.
Source: Thomson Reuters
The Directors have chosen to compare the Group’s TSR performance with the TSR of companies in the FTSE
SmallCap Index. This Index has been selected because the Company has been a constituent of this index for
most of the period.
45
Business Review
Governance
AUDITED INFORMATION
Executive Directors’ emoluments
Full details of the emoluments of the Directors, relating to the year ended 25 February 2010, were as follows:
Total Total
Salary & Fees* Benefits Bonus 2009/10 2008/09
Executive £000 £000 £000 £000 £000
Stephen Thomas 475 26 — 501 578
Nick Beighton 43 2 — 45 365
Robert McDonald 265 17 — 282 —
Total 783 45 — 828 943
* Notional salary, which includes the 6% of base salary sacrificed for pension in relation to Stephen Thomas and Nick Beighton and the 22%
salary supplement received in lieu of pension contributions for Stephen Thomas. The salary sacrifice arrangements ceased when Stephen
Thomas received a salary supplement in lieu of pension with effect from 1 December 2009 and on Nick Beighton’s departure from the
Company. Notional salary for Robert McDonald includes a 15% salary supplement in lieu of pension and also includes salary sacrifice made
for additional holiday. Robert McDonald joined the Company on 16 March 2009.
Benefits in kind include the provision to every Executive Director of a Company car or allowance, fuel and private
medical insurance.
Non-Executive Directors’ emoluments

Details of the emoluments of the Non-Executive Directors, relating to the year ended 25 February 2010, are as set
out below. The fees are paid as a combination of cash and shares (£35,000 cash and £10,000 of shares, purchased
twice a year at the prevailing share price). The Chairman’s fees (£155,000) are paid entirely in cash. The Non-
Executive Director fees were last reviewed in March 2009.
Year ended Year ended

25 February 26 February
2010 2009
£000 £000
Alan Jackson 155 155
Debbie Hewitt 45 44
Richard Brooke* — 14
John Jackson 45 44
Total 245 257
* Left the Board on 30 May 2008.
Executive Directors’ pension provision

For each Executive Director, the amounts payable by the Group in the year in respect of their pension
entitlements were as follows:

2010 2009
£000 £000
Stephen Thomas 86* 116
Nick Beighton 7† 43
Total 93 159
* T
his includes Company contributions of 25% of salary (£85,671) but excludes salary sacrifice by the individual of 6% of salary (£20,250)
and the salary supplement in lieu of pension of 22% of salary (£24,750) which replaced the existing pension arrangement from
1 December 2009.
† This includes Company contributions of 15% of salary (£6,613) but excludes salary sacrifice by the individual of 6% of salary (£2,554) up
until his departure on 26 April 2009.
46
As disclosed in last year’s Remuneration Report, under arrangements made in 2002, the Group made additional
contributions to the arrangements for Stephen Thomas to compensate for historical underfunding. These
payments were held in a separate account by the Group and during the year these funds were paid over to a
personal pension fund and as such the Group is no longer holding these moneys.
Performance Share Plan

Details of the conditional awards held by the Executive Directors under the Luminar Group Holdings plc 2007
Performance Share Plan (“2007 PSP”) are set out below:
Share
Price
At Granted Forfeited At on Date
27 Feb during during 25 Feb Date of Vesting of Grant
2009 year year 2010 award Date (£)
Stephen Thomas 140,019 — — 140,019 09/11/07 01/08/10* 5.745
332,750 — — 332,750 22/05/08 22/05/11 3.20
— 376,824 — 376,824 10/06/09 10/06/12 1.41
Total 472,769 376,824 — 849,593
Nick Beighton‡ 76,867 — (33,983) 42,884 09/11/07 01/08/10* 5.745
134,411 — (90,228) 44,183 22/05/08 22/05/11 3.20
Total 211,278 — (124,211) 87,067
Robert McDonald — 200,972 — 200,972 10/06/09 10/06/12 1.41
Total — 200,972 — 200,972
* The vesting period (which is slightly shorter than the usual three years) for the 2007 awards reflected the delay in granting awards caused
by the Group reorganisation and return of capital to Shareholders.
‡ Nick Beighton ceased to be a Director of the Company on 26 April 2009. As a result, 124,211 awards were forfeited. His remaining shares
were then adjusted as per the note † above.
The number of awards was amended during the year due to the impact of the Firm Placing and Placing and Open Offer (the “Placing”)
undertaken by the Company in August 2009. These changes was necessary to neutralise the dilutive effect of the Open Offer.
These alterations were made using a prescribed formula, which had the effect of ensuring that the position of the option holders before
and after the Placing remained the same.
All the awards granted under the 2007 PSP are subject to continued employment and the satisfaction of the
following performance conditions.
The performance conditions for the 2007 awards to the Executive Directors are as follows:
50% of the awards will vest based on the relative TSR performance of the Group compared to the FTSE 250
Index measured over the period from grant to 31 July 2010, of which 25% (of this part of the award) will vest
if the Group’s TSR performance matches that of the FTSE 250 Index increasing on a straight-line basis to full
vesting (of this part of the award) if the Group’s TSR performance exceeds that of the FTSE 250 Index by 40%.
Vesting will be determined on a straight-line basis between these two points.
The other 50% of the awards will vest dependent on the satisfaction of four strategic milestones by the
2009/10 financial year end as follows:
— 20% of the award will be based on the Return on Investment (“ROI”) target (increasing ROI after
tax to 25% per annum);
— 10% of the award will be based on achieving central cost savings of £3.5m–£4.0m;
— 10% of the award will be based on reducing staff turnover from 220% to 140%–120%; and
— 10% of the award will be based on returning £70.0m–£100.0m to Shareholders.

47
Business Review
Governance
Except for the ROI target (which is a single hurdle), growth is equal to RPI + 3% p.a. with full vesting
25% of each part of the award will vest for achieving requiring growth at RPI + 7% p.a. For awards
the initial threshold increasing on a straight-line in excess of 100% of base salary, there will be
basis to full vesting of the relevant part of the award incremental vesting between RPI + 7% p.a. (0%
for achieving the upper limit. vesting) and RPI + 10% p.a. (100% vesting) for the
awards subject to the EPS performance condition
With effect from 19 October 2007, Luminar Group (i.e. 50% of the excess).
Holdings plc was inserted as the new holding
company of the Luminar Group. The performance The performance conditions for the 2009 awards to
conditions take into account the performance of the Executive Directors are as follows:
Luminar plc before the Reorganisation was effected
and Luminar Group Holdings plc thereafter. 50% of the awards will vest based on the relative
TSR performance of the Group compared to the
Under the rules of the 2007 PSP, the grant of these constituents of the FTSE SmallCap Index measured
awards is at the sole discretion of the Remuneration over three years from the date of grant. 25% of this
Committee. Furthermore, the vesting of an award is part of the award will vest if the Company’s TSR is
also subject to the discretion of the Remuneration equal to the median Company’s TSR. Full vesting
Committee. requires the Company’s TSR to be at or above the
upper quintile. There will be incremental vesting
In light of the share price, loss of Shareholder value between median and upper quintile.
and trading performance of the Group as a whole,
the Remuneration Committee has decided neither The other 50% of the awards are subject to an
to make any awards under the 2007 PSP for this EPS target based on the growth in pre-exceptional
financial year, nor to allow any awards for the EPS over the period of three financial years. 25%
Executive Directors, which were due to vest in the of the award will vest if EPS growth is equal to
2010/11 financial year, to mature. RPI + 3% p.a. with full vesting requiring growth at
RPI + 7% p.a.
The performance conditions for the 2008 awards to
the Executive Directors are as follows: Nick Beighton left the Company on 26 April 2009. He
has been treated as a ‘good leaver’ under the terms
50% of the awards will vest based on the relative of the Performance Share Plan. His outstanding long-
TSR performance of the Group compared to the term incentive awards will be capable of vesting on
constituents of the FTSE SmallCap Index, measured the third anniversary of grant subject to achievement
over three years from the date of grant, of which of the performance conditions. The awards, to the
25% of this part of the award will vest if the extent that they vest, will be scaled back to reflect the
Company’s TSR is equal to the median company’s proportion of the vesting period that he has served.
TSR. Full vesting requires the Company’s TSR to
be at or above the upper quintile. There will be When Stephen Thomas leaves the Company on
incremental vesting between median and upper 31 July 2010 his outstanding awards will be treated on
quintile. the same basis as above for Nick Beighton.
The other 50% of the awards are subject to an

Earnings per Share (“EPS”) target based on the
growth in pre-exceptional EPS over the period of
three financial years. For aggregate awards up to
100% of base salary (i.e. of which half is based on
EPS), of which 25% of the award will vest if EPS
48
SHARE OPTIONS
Share options are exercisable between three and ten years from the date of grant. Options were originally
granted subject to performance conditions requiring EPS growth (calculated pre-exceptional items and tax) over
a three-year period. For options granted between 2000 and 2002, the EPS growth hurdle is RPI +5% per annum
compound. For options granted in 2003, the EPS growth hurdle is RPI +3% per annum compound.
As disclosed in last year’s Remuneration Report, outstanding options held by Executive Directors (see below)
were rolled over into equivalent options over shares in the Company in connection with the business capital
reorganisation in 2007. However, following the technical change of control of Luminar plc in connection with
the reorganisation, the Rules of the 1996 Executive Share Option Scheme prescribed that unapproved options
became immediately exercisable, with performance conditions falling away (this was a standard feature in rules
of this vintage). Therefore, the exercise of the rolled over unapproved options is not subject to any performance
conditions. Similarly, rolled over approved options are not subject to performance conditions, as prescribed by
the rules of the 1999 Company Share Option Plan (a common provision in rules of this vintage).
Details of the share options held by the Executive Directors are as follows:
Stephen Thomas
Earliest At Lapsed At
Exercise Expiry Exercise 27 Feb during Exercised 25 Feb
Date of Grant Date Date Price 2009 year in year 2010
1996 Executive Share Option Scheme (Unapproved)
11/07/00 11/07/03 10/07/10 6.57 543,689 — — 543,689
04/07/01 04/07/04 03/07/11 8.09 28,419 — — 28,419
22/05/03 22/05/06 21/05/13 3.73 214,261 — — 214,261
Total 786,369 — — 786,369
1999 Company Share Option Plan (Approved)
04/07/01 04/07/04 03/07/11 8.09 3,706 — — 3,706
Total 3,706 — — 3,706
The number of share options awarded was amended during the year due to the impact of the Placing undertaken by the Company in
August 2009. These changes were necessary to neutralise the dilutive effect of the Open Offer.
These alterations were made using a prescribed formula, which had the effect of ensuring that the position of the option holders before and
after the Placing remained the same.
Under the terms of the option plans Stephen Thomas will be eligible to exercise outstanding share options
within two years following his cessation of employment.
DirectorS’ INTERESTS
The beneficial interests of Directors who served at the end of the year, together with those of their families are
shown in the Report of the Directors on page 50.
The mid-market price of the Company’s shares on 25 February 2010 was 28 pence and the range for the year was
between 28 pence and 92 pence.
By Order of the Board
DEBBIE HEWITT
Chair of the Remuneration Committee
49
Business Review
Governance
Report of the Directors Consolidated Financial Statements
For the year ended 25 February 2010 Company Financial Statements
The Directors present their Report for the year ended John Leach joined the Board as a Non-Executive
25 February 2010. Director on 30 April 2010. John has wide experience
Principal Activity
where from 2003 to 2008 he was involved in various
The principal activity of the Group during the year
roles and latterly as Chief Executive of Hermes Focus
was as owner, developer and operator of themed bars
Asset Management Limited. Prior to this he was
and nightclubs.
Chairman of Orbis plc, Waterhall Group plc and
Business Review Brent Walker Group, where he was Chief Executive
The Report of the Directors and the CSR incorporates and Finance Director from 1994 to 1998 and Group
the Business Review set out on pages 12 to 20 of this Finance Director from 1991 to 1994.
Report and forms part of the ‘management report’ for
Philip Bowcock joins the Board as Finance Director
the purpose of Rule 4.1.8 of the Disclosure Rules and
on 1 June 2010 from Barratt Developments plc,
Transparency Rules, which has been incorporated by
where from August 2007 he has been Group Financial
reference.
Controller. Prior to this, he held senior finance roles at
The financial risk management objectives and policies Tesco and Hilton Group.
of the Group, including the policy for hedging each
Stephen Thomas left the Board on 1 March 2010. He
major type of forecasted transaction for which hedge
was the Chief Executive Officer and founder of Luminar.
accounting is used and the Group’s exposure to price
Stephen was instrumental in shaping the business into
risk, credit risk, liquidity risk and cash flow risk is set
what it is today and the Board is grateful to him for his
out in the principal accounting policies section and
efforts and the significant contribution he has made.
also note 22 to the financial statements which have
been incorporated by reference. Alan Jackson is stepping down as Chairman as at the
Results and Dividends end of his current three-year appointment on 13 July
The Board recommends that there is no payment of a 2010 and will not be offering himself for re-election
final dividend. for a further three-year term. John Leach will be
appointed as his successor as of 13 July 2010. The
The results of the Group are summarised on page 57. Board is grateful for the considerable part that Alan
has played in laying the foundations for the recovery
Directors
of growth in Luminar.
The current Board of Directors is shown on pages 30
and 31 of this Report. Appointments to the Board are recommended
by the Nominations Committee and are made in
Nick Beighton left the Board on 26 April 2009. He
accordance with the provisions of the Articles of
was the Finance Director and throughout his term
Association. Article 99 requires each Director to retire
of office contributed greatly to the transformation of
from office at the Annual General Meeting unless he
the Company to becoming a business in which the
was appointed or reappointed as a Director at either
majority of its clubs were branded dancing venues.
of the last two Annual General Meetings before that
The Board would like to thank him for his efforts and
meeting. Therefore, Simon Douglas, John Leach and
the significant contribution he has made.
Philip Bowcock, who have been appointed since the
Robert McDonald joined the Board in March 2009 last Annual General Meeting, are offering themselves
in the position of Finance Director. He brought for election by the Shareholders at the forthcoming
substantial experience of the leisure sector and Annual General Meeting.
has a strong track record of delivery. At the time of
Alan Jackson, Debbie Hewitt and John Jackson, as
announcing the results for the year ended 25 February
Non-Executive Directors, were appointed initially for
2010, it has also been announced that Robert has
a three-year term. They were each reappointed on
decided to step down from the Board on 31 May 2010.
20 July 2007 and therefore the current three-year term
The Board would like to extend its thanks to Robert
of these appointments will expire at the latest on 20
for the contribution that he has made during his time
July 2010. Having taken into account the balance of
in the business.
skills and experience of the Board, their contribution
Simon Douglas joined the Board in March 2010 in and level of independence, the Board has asked
the position of Chief Executive. Simon has a strong Alan, Debbie and John to remain for a further three-
track record in the leisure and entertainment sector, year term. Debbie and John are, therefore, offering
including various management roles at HMV, Virgin themselves for re-election for a further three-year
Retail and latterly as CEO in leading the MBO of Zavvi, term, a decision that the Shareholders will be asked to
where he extracted considerable shareholder value approve at the forthcoming Annual General Meeting.
from the businesses. Alan has decided to step down as Chairman at the
50
Report of the Directors (continued)
end of his current three-year appointment and will not Following a detailed review of the Company’s
be offering himself for re-election. circumstances, the size of the indemnity cap was
agreed at £5.0m.
During the year, the Group maintained liability
insurance for its Directors and Officers. Although the Company acknowledges that these
indemnities will cover any liabilities already incurred,
On 2 May 2008, the Board approved the Company the Company is not aware of any existing liabilities or
entering into Qualifying Third Party Indemnities of any circumstances that may be reasonably likely to
(“QTPIPs”) in favour of Stephen Thomas and Nick give rise to any such liabilities.
Beighton. Stephen Thomas and Nick Beighton have
since ceased to be Directors of the Company but the Other than in respect of the disposal of the
QTPIP continues to apply to them. Entertainment Division to 3DE of which Stephen
Thomas is Chairman and Nick Beighton was a
These QTPIPs provide an indemnity in respect of Director, no Director had a material interest in any
the Company and several of its subsidiaries. These contract or arrangement to which the Group or any
indemnities were also provided to Tim O’Gorman and subsidiary was a party.
Andy Marks in their capacity as Directors of various
subsidiaries of the Company. In accordance with the Act, Conflicts of Interests
provisions that came into force on 1 October 2008, a
Following the appointments of Robert McDonald Register of Conflicts has been established and currently
and Simon Douglas, the Company has entered into no conflicts have been identified.
a QTPIP with each of them on similar terms. These
QTPIPs were approved respectively on 29 April 2009 The interests of the Directors in the ordinary shares of
and 30 April 2010. the Group on 25 February 2010 and 26 February 2009
were as follows:
2010 2009
No. No.
Alan Jackson 7,488 4,545
Stephen Thomas (left the Board on 1 March 2010) 423,671 257,137
Nick Beighton (left the Board on 26 April 2009) — 40,666
Robert McDonald (appointed 16 March 2009) 50,000 —
Debbie Hewitt 14,072 2,902
John Jackson 11,191 2,901
After the year end, Simon Douglas and Alan Jackson acquired certain shares in the Company as follows:
Total
Number interests
Date shares of shares as at 13 May
acquired acquired 2010
Simon Douglas 5 March 2010 25,000 25,000
Alan Jackson 13 May 2010 30,000 37,488
Simon Douglas 13 May 2010 30,000 55,000
After the year end, the Group acquired further shares for the Non-Executive Directors as part of the contractual
remuneration of those Directors. The shares acquired were as follows:
Total
Number interests
Date shares of shares as at 12 May
acquired acquired 2010
Debbie Hewitt 1 March 2010 17,000 31,072
John Jackson 1 March 2010 10,000 21,191
51
Business Review
Governance
Other than these acquisitions and the shares listed Under the Firm Placing and Placing and Open Offer
above, there have been no changes in the interests 39,473,685 Ordinary Shares (as sub-divided) were
of the Directors in the share capital of the Group issued at 95 pence per share, of which 19,157,362 New
between 25 February 2010 and the date of the signing Ordinary Shares were issued through the Firm Placing
of this Report on 12 May 2010. and 20,316,323 through the Placing and Open Offer.
These New Ordinary Shares were admitted for trading
No Director had any interest in the shares of any of on the main market of the London Stock Exchange on
the Group’s subsidiaries during the year ended 19 August 2009.
25 February 2010.
Following the Firm Placing and Placing and Open
The interests of the Directors in share options and Offer, the Company had an enlarged issued share
other long-term incentive plans are set out in the capital of 100,422,654 Ordinary Shares with a nominal
Remuneration Report on pages 46 and 48. value of 25 pence
Share capital As at 12 May 2010, there are 100,422,654 Ordinary

At the 2009 Annual General Meeting, the Shares with a nominal value of 25 pence each in issue.
Shareholders gave the Company the power to issue There are no restrictions on the transfer of these
and buy back shares. The authority to purchase and shares or on the voting rights attached to them.
cancel its shares is limited to being up to a maximum
of 10% of its own shares. This authority will expire at In addition, there were 60,948,969 Deferred Shares
the conclusion of the forthcoming Annual General with a nominal value of 175 pence in issue. These
Meeting, at which a Special Resolution will be shares had no value, no rights and were not listed.
proposed to renew the authority for a further year. These Deferred Shares were cancelled on 30 April
2010.
The Board has not exercised this power during the
year ended 25 February 2010. The Board did not The Company is not aware of any agreements
exercise this power in the period between then and between holders of securities known to the Company,
the signing of this Report on 12 May 2010. which may result in restrictions on the transfer of
securities or voting rights.
It is the intention of the Company to repeat these
powers and the resolution approving it is found in No person holds shares with specific rights regarding
the Notice of the Annual General Meeting in control of the Company.
resolution 14.
The Company does not operate any employee share
In August 2009, the Company undertook a Capital schemes in relation to which there are shares with
Reorganisation, Firm Placing and Placing and Open rights with regard to the control of the Company
Offer in order to raise net proceeds of £35.7m. which are not exercisable by the employees.
Prior to the Firm Placing and Placing and Open Offer, There are no agreements between the Company
the Shareholders, at a General Meeting, duly passed and its Directors or employees which provide for
resolutions that sub-divided and reclassified each compensation for loss of office or employment that
existing issued and unissued Ordinary Share of 200 occurs because of a takeover bid.
pence each into one New Ordinary Share of 25 pence Substantial Shareholders
each and one New Deferred Share of 175 pence each. At 11 May 2010 (the last practical date before the
The new class of Deferred Shares were restricted under approval of this Report), the Group had been notified
the Articles of Association of the Company so that of the following significant shareholdings and interests
they had no rights and were not listed. in the shares of the Group, pursuant to Section 793 of
the Act:
Name of Shareholder
Schroder Investment Management 21.22%
Hermes Pensions Management 14.56%
Fidelity Investments 8.35%
Morgan Stanley 3.42%
Legal & General Investment Management 3.10%
52
Contracts The Group’s in-house newsletter, noticeboards,

Although the Company has a few contracts that may employee forums, team briefings, staff suggestion
be subject to change of control provisions, all of these scheme and opinion surveys all illustrate that
contracts were recently assigned or novated as part employees are both well informed and able to feed back
of a restructure and Scheme of Arrangement and no and contribute towards the running of the business.
significant problems have been encountered in regard
to changing the contracting parties. Luminar has been accredited as ‘One to Watch’
through the Best Companies to work for survey.
Employment policies
Luminar has a strategy of People Excellence achieved Finally, reward and recognition is achieved through
through: a variety of different methodologies including
employee of the month schemes, incentives, bonus
attracting and retaining talented individuals; arrangements and share schemes. Annual appraisals
also provide the opportunity for constructive
communication and engagement;
feedback, recognition and succession planning.
reward and recognition; and
Luminar’s People Strategy is reviewed and updated
training, learning and development. on an annual basis and measured through employee
retention rates.
This strategy is part of a ‘one system approach’ which
Supplier payment policy and practice
combines people, customer, financial and session
The Group’s policy with regard to the payment of
excellence, each with KPIs attached.
suppliers is to agree terms of payment at the start of
In January 2010, 55 support managers graduated business with each supplier, to ensure that the supplier is
with a foundation degree in Leadership and made aware of the standard payment terms. Such terms
Management (Late Night Entertainment). This was a include an undertaking to pay suppliers within an agreed
huge achievement for all concerned and means that period subject to terms and conditions being met by
the business has professionally qualified managers suppliers. Creditor days for the Group at the year end
in place within the venues. The programme also amounted to 42 days (2009: 57 days) of total supplies for
forms part of a career path whereby individuals can the year. Since the Company is a holding company and
join as crew members (bar staff, glass collectors and does not ‘trade’, creditor days have not been disclosed.
receptionists) and undertake the crew development
Research and development
programme. Once promoted to a management
All businesses within the Group continue to be active
grade they complete the foundation degree which
in developing new ways of working for the benefit of
leads to a BA (Honours) degree in Leadership and
the business and our customers.
Management once they become a General Manager.
The success of the foundation degree programme and Charitable and political donations
the partnership with Loughborough College resulted The Group has established a charitable trust, the
in Luminar winning a regional and National Training ECHO Trust, to channel the Group’s charitable
Award and then becoming ‘Winner of the Year’ activities to those in need. During the year ended
25 February 2010, a total of £341,878 (2009: £367,178)
The Group has defined its values as ‘The Luminar was raised from donations by our customers in charity
Difference’, which is about being more professional, collections and events organised by the Group. These
more passionate, more principled and more moneys were paid to the ECHO Trust and a total of
participative. These values apply both internally and £169,995 (2009: £154,057) was paid out by the ECHO
externally when dealing with our customers. Trust to national and local charities.
Employment policies do not discriminate between No direct contributions for charitable purposes
employees or potential employees on the grounds of were made during the year (2009: £nil). No political
gender, colour, race, nationality, ethnic origin, national donations were made during the year (2009: £nil).
origin, religion, religious beliefs, sexual orientation
or age. Consideration is given to all applicants for Post-Balance Sheet Events
employment from candidates with disabilities As noted on page 104, the following events have
where the requirements of the job can be covered. If occurred since 25 February 2010:
employees become disabled, every effort is made to
3DE went into administration on 26 February 2010;
ensure their employment continues with appropriate
and
training and reasonable adjustments being made.
all of the Deferred Shares in the capital of the
Company were cancelled on 30 April 2010.
53
Business Review
Governance
Statement of Directors’ The Directors confirm that they have complied with
responsibilities in respect of the the above requirements in preparing the financial
Annual Report, the Directors’ statements.
Remuneration Report and the
financial statements The Directors are responsible for keeping proper
The Directors are responsible for preparing the Annual accounting records that disclose with reasonable
Report, the Remuneration Report, Business Review accuracy at any time the financial position of
and statement of risk and the Consolidated and the the Company and the Group and to enable
Company financial statements in accordance with them to ensure that the Consolidated financial
applicable law and regulations. statements comply with the Act and Article 4
Company law requires the Directors to prepare of the IAS Regulation and the parent Company
financial statements for each financial year. Under that financial statements and the Remuneration Report
law, the Directors have prepared the Consolidated comply with the Act. They are also responsible for
financial statements in accordance with International safeguarding the assets of the Company and the
Financial Reporting Standards (IFRSs) as adopted Group and hence for taking reasonable steps for
by the European Union, and the parent Company the prevention and detection of fraud and other
financial statements and the Remuneration Report in irregularities.
accordance with applicable law and United Kingdom The Directors confirm that to the best of their
Accounting Standards (United Kingdom Generally knowledge:
Accepted Accounting Practice). The Consolidated and
parent Company financial statements are required by the financial statements, prepared in accordance
law to give a true and fair view of the state of affairs of with the applicable set of accounting standards,
the Company and the Group and of the profit or loss give a true and fair view of the assets, liabilities,
of the Group for that period. financial position and profit or loss of the listed
Company and the undertakings included in the
In preparing those financial statements, the Directors
consolidation taken as a whole;
are required to:
the Business Review includes a fair review of the
select suitable accounting policies and then apply
development and performance of the business and
them consistently;
position of the Company and the undertakings
make judgements and estimates that are reasonable included in the consolidation taken as a whole,
and prudent; together with a description of the principal risks
and uncertainties that are faced; and
state that the Consolidated financial statements
comply with IFRSs as adopted by the European the Company is responsible for all information
Union, and with regard to the parent Company drawn up and made public in accordance with DTR
financial statements that applicable UK Accounting paragraph 4.1.13.
Standards have been followed, subject to any
material departures disclosed and explained in the
financial statements; and
prepare the Consolidated and parent Company

financial statements on the going concern basis
unless it is inappropriate to presume that the
Group will continue in business, in which case there
should be supporting assumptions or qualifications
as necessary.
54
Going concern On this basis, having examined evidence and made

The Group benefits from a syndicated loan facility appropriate enquiries, the Directors are satisfied
of £175m, which extends until August 2012 and that adequate financial resources are available to the
against which net borrowings are currently £92.6m. Group within circumstances that can be reasonably
The facility is subject to financial covenants, the most foreseen.
significant of which requires net borrowings not to
exceed three times the value of adjusted EBITDA. At For this reason, the Directors continue to adopt the
25 February 2010 this covenant test ratio was 2.65, going concern basis in preparing the Consolidated and
providing adequate headroom within the facility. the Company’s financial statements.
Disclosure of information
The Group’s budgeted cash flow projections
to auditors
anticipate sufficient cash generation to retain and
So far as the Directors are aware, there is no relevant
increase covenant headroom over the course of the
audit information (that is, information needed by the
forthcoming year. However, recent trading has fallen
Group’s Auditors in connection with preparing their
below budgeted levels and the market continues to
report) of which the Group’s Auditors are unaware,
be volatile.
and the Directors have taken the steps that they
If these volatile conditions continue, the Directors ought to have taken as Directors, in order to make
have examined available mitigating actions through themselves aware of any relevant audit information
further cost reduction or retail price management but and to establish that the Group’s Auditors are aware of
recognise there is the potential for headroom on the that information.
facility to be eroded. In these circumstances, it is likely Auditors
that the Group would need to renegotiate the terms PricewaterhouseCoopers LLP have indicated their
of the facility and that this will have an impact on the willingness to continue in office, and a resolution for
cost of borrowing. The Directors have considered the their reappointment will be proposed to the Annual
action the syndicate banks may take in such a scenario General Meeting.
and, having taken external advice on the matter,
concluded that it is highly likely that the banks will By Order of the Board
agree to renegotiate the facilities.
Tim O’Gorman
Company Secretary
12 May 2010
(Registered number: 06239034)
55
Business Review
Governance
Consolidated
57 Consolidated Statement of Comprehensive Income
60 Consolidated Statement of Changes in Shareholders’ Equity
61 Principal Accounting Policies
70 Notes to the Consolidated Financial Statements
56
Independent Auditors’ Report to the

Members Of Luminar Group Holdings plc
We have audited the Group financial statements of Luminar Group Opinion on other matters prescribed by the
Holdings plc for the year ended 25 February 2010 which comprise Companies Act 2006
the Consolidated Income Statement, the Consolidated Statement of In our opinion:
Comprehensive Income, the Consolidated Balance Sheet, the Consolidated
Cash Flow Statement, the Consolidated Net Debt Statement, the the information given in the Directors’ Report for the financial year for
Consolidated Statement of Changes in Shareholders’ Equity, the Principal which the Group financial statements are prepared is consistent with the
Accounting Policies for the Consolidated Financial Statements and the Group financial statements; and
Notes to the Consolidated Financial Statements. The financial reporting
the information given in the Corporate Governance Statement in the
framework that has been applied in their preparation is applicable law
Annual Report with respect to internal control and risk management
and International Financial Reporting Standards (IFRSs) as adopted by the
systems and about share capital structures is consistent with the financial
European Union.
statements.
Respective responsibilities of Directors and auditors
As explained more fully in the Directors’ Responsibilities Statement, the Matters on which we are required to report
Directors are responsible for the preparation of the Annual Report and the by exception
Consolidated Financial Statements and for being satisfied that they give a We have nothing to report in respect of the following:
true and fair view. Our responsibility is to audit the Consolidated Financial
Statements in accordance with applicable law and International Standards Under the Companies Act 2006 we are required to report to you if, in our
on Auditing (UK and Ireland). Those standards require us to comply with opinion:
the Auditing Practices Board’s Ethical Standards for Auditors.
certain disclosures of Directors’ remuneration specified by law are not
This report, including the opinions, has been prepared for and only for the made; or
Company’s members as a body in accordance with Chapter 3 of Part 16 of
the Companies Act 2006 and for no other purpose. We do not, in giving we have not received all the information and explanations we require for
these opinions, accept or assume responsibility for any other purpose or to our audit.
any other person to whom this report is shown or into whose hands it may
Under the Listing Rules we are required to review:
come save where expressly agreed by our prior consent in writing.
Scope of the audit of the financial statements the Directors’ statement, in relation to going concern; and
An audit involves obtaining evidence about the amounts and disclosures
the part of the Corporate Governance Statement relating to the
in the financial statements sufficient to give reasonable assurance that
Company’s compliance with the nine provisions of the June 2008
the financial statements are free from material misstatement, whether
Combined Code specified for our review.
caused by fraud or error. This includes an assessment of: whether the
accounting policies are appropriate to the Group’s circumstances and have
been consistently applied and adequately disclosed; the reasonableness Other matter
of significant accounting estimates made by the Directors; and the overall We have reported separately on the parent Company financial statements
presentation of the financial statements. of Luminar Group Holdings plc for the year ended 25 February 2010 and
on the information in the Directors’ Remuneration Report that is described
Opinion on financial statements as having been audited.
In our opinion the Group financial statements:
give a true and fair view of the state of the Group’s affairs as at 25 February Owen Mackney (Senior Statutory Auditor)
2010 and of its loss and cash flows for the year then ended; For, and on behalf of, PricewaterhouseCoopers LLP
Chartered Accountants and Statutory Auditors
have been properly prepared in accordance with IFRSs as adopted by the St Albans
European Union; and 12 May 2010
have been prepared in accordance with the requirements of the
Companies Act 2006 and Article 4 of the lAS Regulation.
57
Business Review
Governance
Financial Statements Consolidated Financial Statements
Consolidated Income Statement

for the year ended 25 February 2010
Year ended 25 February 2010 Year ended 26 February 2009

Pre- Exceptional Pre- Exceptional
exceptional items exceptional items
items (note 8) Total items (note 8) Total
Note £m £m £m £m £m £m
Continuing operations
Revenue 1,2 173.1 — 173.1 193.2 — 193.2
Cost of sales (30.2) — (30.2) (34.1) — (34.1)

Gross profit 142.9 — 142.9 159.1 — 159.1
Administrative expenses (131.3) (114.6) (245.9) (130.5) (9.8) (140.3)

Profit/(loss) from operations 1,2 11.6 (114.6) (103.0) 28.6 (9.8) 18.8
Finance income 3 1.1 — 1.1 1.8 — 1.8
Finance costs 3 (8.3) — (8.3) (10.1) — (10.1)

Profit/(loss) before taxation 4.4 (114.6) (110.2) 20.3 (9.8) 10.5
Tax credit/(charge) on profit/(loss) 5 0.7 10.3 11.0 (4.5) 1.4 (3.1)

Profit/(loss) for the year from
continuing operations attributable
to equity shareholders 5.1 (104.3) (99.2) 15.8 (8.4) 7.4
(Loss) from discontinued

operations* 9 (0.4) (23.5) (23.9) (0.2) (28.7) (28.9)

Profit/(loss) for the year
attributable to
equity shareholders 4.7 (127.8) (123.1) 15.6 (37.1) (21.5)

Earnings per share from
continuing operations 7
Basic (120.4) 12.2p
Diluted (120.4) 12.2p
Earnings per share from continuing
and discontinued operations 7
Basic (149.4) (35.3p)
Diluted (149.4) (35.3p)
* The (loss) from discontinued operations is stated post-tax.
The accompanying accounting policies and notes form an integral part of these financial statements.
Consolidated Statement of Comprehensive Income


2010 2009
£m £m
Loss for the year (123.1) (21.5)

Other comprehensive income
Cash flow hedges (net of tax) (0.5) (7.6)

Other comprehensive Income from the period, net of tax (0.5) (7.6)

Total Comprehensive Income for the year attributable to equity shareholders (123.6) (29.1)
58
Financial Statements (continued)
Consolidated Balance Sheet

at 25 February 2010
2010 2009
Note £m £m
Non-current assets
Goodwill 10 130.8 171.9
Other intangible assets 11 2.6 3.1
Property, plant and equipment 12 226.9 308.9
Other non-current assets 13 1.9 3.9
Trade and other receivables 16 — 22.7

362.2 510.5
Current assets
Inventories 15 1.5 2.1
Trade and other receivables 16 5.6 7.4
Cash and cash equivalents 17 37.3 27.9
Monies on deposit 17 10.0 —

54.4 37.4
Assets classified as held for sale 9 2.1 2.4
Investment in associate held for sale 14 — 3.6

Total current assets held for sale 2.1 6.0

56.5 43.4
Current liabilities
Trade and other payables 19 (14.1) (17.8)
Current tax liabilities 20 (42.8) (42.7)
Deferred income 21 (0.5) (0.5)
Provisions 24 (2.3) (1.5)

(59.7) (62.5)
Liabilities classified as held for sale 9 (0.7) (6.0)

(60.4) (68.5)
Net current liabilities (3.9) (25.1)

Total assets less current liabilities 358.3 485.4
Non-current liabilities
Borrowings and loans 18 (139.9) (169.7)
Derivative financial instruments 22 (13.8) (13.2)
Deferred income 21 (6.1) (6.3)
Obligations under finance leases 23 (7.9) (7.9)
Deferred tax liabilities 25 (7.9) (20.3)

(178.5) (218.1)
Net assets 179.8 267.3

Capital and reserves
Share capital 26 131.8 121.9
Share premium 28 25.8 —
Capital redemption reserve 28 42.1 42.1
Equity reserve 28 1.7 1.2
Retained earnings 28 (21.6) 102.1

Shareholders’ equity 179.8 267.3
The financial statements were approved by the Board of Directors on 12 May 2010.
Robert McDonald
Finance Director
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Consolidated Cash Flow Statement


2010 2009
Note £m £m
Cash flows from operating activities

Net cash inflow from operations 29 23.3 42.1
Finance costs paid (8.2) (10.1)
Tax received 2.2 —

17.3 32.0

Cash flows from investing activities
Purchase of property, plant and equipment (3.9) (36.8)
Purchase of intangible assets (0.3) (1.3)
Net proceeds from sale of property, plant and equipment (including motor vehicles) 0.5 13.8
Acquisition of business units — (0.2)
Finance income received 0.1 0.1

(3.6) (24.4)

Cash flows from financing activities
Repayment of long-term borrowings (30.0) —
Drawdown of new facility (post-issue costs) — 25.0
Monies placed on deposit (10.0) —
Net proceeds from issue of shares 35.7 —
Dividends paid — (11.8)

(4.3) 13.2

Net increase in cash and cash equivalents 9.4 20.8
Cash and cash equivalents at beginning of year 17 27.9 7.1

Cash and cash equivalents at end of year 17 37.3 27.9
Consolidated Net Debt Statement

The movement in net debt in the year was analysed as follows:

2010 2009
Note £m £m
Increase in cash in the year (9.4) (20.8)

Non-cash changes — movement in finance lease liabilities — —
Cash inflow from increases in debt (post-issue costs) — 25.0
Cash outflow from monies being placed on deposit (10.0) —
Cash outflow from repayment of debt (30.0) —

Movement in net debt in the year (49.4) 4.2
Opening net debt 150.0 145.8

Closing net debt 30 100.6 150.0
60
Consolidated Statement of Changes in Shareholders’ Equity

Capital
Share Share redemption Equity Retained
capital premium reserve reserve earnings Total
£m £m £m £m £m £m
Brought forward at 29 February 2008 134.2 — 29.8 1.2 142.7 307.9

Total comprehensive income for the year — — — — (29.1) (29.1)
Share-based payment charge — — — 0.3 — 0.3
Issue of shares out of Employee Benefit Trust — — — (0.3) 0.3 —
Dividends paid (note 6) — — — — (11.8) (11.8)
Cancellation of deferred shares (12.3) — 12.3 — — —

Carried forward at 26 February 2009 121.9 — 42.1 1.2 102.1 267.3

Total comprehensive income for the year — — — — (123.6) (123.6)
Share-based payment charge — — — 0.5 — 0.5
Issue of shares (net of costs) 9.9 25.8 — — — 35.7
Purchase of shares through Employee Benefit Trust — — — — (0.1) (0.1)

Carried forward at 25 February 2010 131.8 25.8 42.1 1.7 (21.6) 179.8
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Principal Accounting Policies for the Consolidated Financial Statements

The principal accounting policies adopted in the preparation of the financial statements are set out below. These policies have been consistently applied
to all years presented, unless otherwise stated.
Basis of preparation
The consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (IFRSs) as adopted by the
European Union and International Financial Reporting Interpretations Committee (IFRIC) and with those parts of the Companies Act 2006 applicable to
companies reporting under IFRSs. The Group has complied with those IFRSs or IFRIC interpretations where the implementation date is relevant to the
financial year ended 25 February 2010. No IFRSs or IFRIC interpretations have been early adopted.
The financial statements of the Company as an entity are prepared under UK Generally Accepted Accounting Principles and are presented separately
from these consolidated financial statements (pages 107 to 119 within this Annual Report).
The financial statements have been prepared on a historical cost basis, except for non-current assets and disposal groups and investments held for sale
measured at their fair value less costs to sell and financial assets and liabilities recorded at fair value.
The preparation of financial statements in conformity with generally accepted accounting principles requires the use of estimates and assumptions that
affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during
the reporting period. Although these estimates are based on management’s best knowledge of the amount, event or actions, actual results may ultimately
differ from those estimates.
As a result of the deferred shares being redeemed and cancelled in July 2008, issued share capital and capital redemption reserve comparatives have been
represented in these consolidated financial statements for the year ended 25 February 2010.
The Group benefits from a syndicated loan facility of £175m which extends until August 2012 and against which net borrowings are currently £92.6m.
The facility is subject to financial covenants, the most significant of which requires net borrowings not to exceed 35 the value of adjusted EBITDA. At
25 February 2010, this covenant test ratio was 2.65, providing adequate headroom within the facility.
The Group’s budgeted cash flow projections anticipate sufficient cash generation to retain and increase covenant headroom over the course of the
forthcoming year. However, recent trading has fallen below budgeted levels and the market continues to be volatile.
The Directors have considered scenarios under which sales and EBITDA fall more than expected and examined mitigating actions available through
further cost reduction or retail price management to maintain headroom within the facility. The Board, however, recognises that there is a potential for
volatile market conditions to erode the headroom available and in these circumstances, it is likely that the Group would need to renegotiate the terms of
the facility and that this will have an impact on the cost of borrowing. The Directors have considered the action the syndicate banks may take in such a
scenario and, having taken external advice on the matter, concluded that it is highly likely that the banks will agree to renegotiate the facilities.
On this basis, having examined evidence and made appropriate enquiries, the Directors are satisfied that adequate financial resources are available to the
Group within circumstances that can be reasonably foreseen.
For this reason, the Directors continue to adopt the going concern basis in preparing the Group’s and the Company’s financial statements.
Impact of new accounting standards

The following new standards, amendments to standards or interpretations are mandatory for the first time for the financial year beginning
27 February 2009:
IAS 1 (revised), Presentation of financial statements — Comprehensive revision including a ‘statement of comprehensive income’ (effective from 1 January
2009), which has impacted the presentational disclosure of the financial statements but has no impact on the carrying values of items.
IFRS 7, Financial instruments: Disclosures — Increases the disclosure requirements about fair value measurement and reinforces existing principles for
disclosure about liquidity risk. The amendment introduces a three-level hierarchy for fair value measurement disclosure and requires some specific
quantitative disclosures for financial instruments in the lowest level in the hierarchy. In addition, the amendment clarifies and enhances existing
requirements for the disclosure of liquidity risk primarily requiring a separate liquidity risk analysis for derivative and non-derivative financial liabilities.
This only affects the disclosure of items within the Group financial statements.
62
Principal Accounting Policies for the Consolidated Financial Statements (continued)

The following standards, amendments and interpretations are mandatory for the first time for the current accounting period but are not relevant to the
Group’s operations:
Amendment to IAS 32, Financial instruments: Presentation, and IAS 1, Presentation of financial statements on Puttable financial instruments and obligations
arising on liquidation (effective 1 January 2009).
IAS 23 (revised), Borrowing costs (effective 1 January 2009).
Amendment to IFRS 2, Share-based payments on Vesting conditions and cancellations (effective 1 January 2009).
IFRIC 13, Client loyalty programmes relating to IAS 18, Revenue (effective 1 July 2008 but EU endorsed for use 1 January 2009).
Impact of accounting standards issued but not adopted

The following new standards and interpretations to existing standards have been published that are mandatory for the Group’s future accounting but
which the Group has not early adopted:
IFRS 1 (revised), First time adoption (effective 1 July 2009, therefore impacting from financial year starting 26 February 2010). This revised standard is not
expected to have any impact on the Group.
IFRS 3 (revised), Business combinations. The Group will apply IFRS 3 (revised) to any transactions from 26 February 2010 onwards, with the main
changes being that directly attributable costs such as advisers’ fees and stamp duty will be charged to the income statement, revisions to contingent
cash consideration in the period following the acquisition will be recorded in the income statement and any difference between the fair value of the
consideration in the buy out of minority interests and the value of their reported minority interest will be recorded against equity rather than goodwill.
IAS 27 (revised), Consolidated and separate financial statements (effective 1 July 2009, therefore impacting from financial year starting 26 February 2010).
This revised statement will impact on presentation only.
Amendment to IAS 32, Financial instruments: Presentation on classification or rights issues. This amendment addresses the accounting for rights issues that
are denominated in a currency other than the functional currency of the issuer (effective 1 February 2010, therefore impacting from financial year starting
26 February 2010). This amendment is not expected to have any material impact on the Group.
Amendment to IAS 39, Financial instruments: Recognition and measurement, on eligible hedged items (effective 1 July 2009, therefore impacting from
financial year starting 26 February 2010). This amended standard will require the Group to split the fair value of the cap and floor swap between intrinsic
and time value, with the time value element no longer eligible to be hedged and therefore potentially increasing volatility in the Income Statement.
Amendment to IFRS 1, First time adoption of IFRS and IAS 27, Consolidated and separate financial statements on the cost of an investment in a subsidiary,
jointly controlled entity or associate (effective 1 July 2009, therefore impacting from financial year starting 26 February 2010). Management are currently
evaluating the impact of this accounting standard.
IFRIC 17, Distributions of non cash assets to owners (effective 1 July 2009, therefore impacting financial year from 26 February 2010). This IFRIC is not
expected to have a material impact on the Group.
IFRIC 18, Transfer of assets from clients (effective 1 July 2009 EU, endorsed 31 October 2009, therefore impacting financial year from 26 February 2010).
This interpretation clarifies the accounting for arrangements where an item of property, plant and equipment, which is provided by the client, is used to
provide an ongoing service but is not expected to have a material impact on the Group.
IFRS 9, Financial instruments on classification and measurement, replacing IAS 39 (effective 1 January 2013, therefore impacting from financial year starting
February 2013). Management are currently evaluating the expected impact of this accounting standard.
Exceptional items
The Group classifies items of income and expenses as exceptional items, where the nature of the item, or its size, is likely to be material so as to assist the
user of the financial statements to better understand the results of the operations of the Group.
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Basis of consolidation
The consolidated financial statements incorporate the financial statements of the Group and entities controlled by the Group.
Control is achieved where the Group has the power to govern the financial and operating policies of an investee entity so as to obtain benefits from its
activities. Control is normally evidenced when the Group either directly or indirectly owns more than 50% of the voting rights or potential voting rights of
a Company’s share capital.
Business combinations
Under the requirements of IFRS 3, Business combinations, all business combinations are accounted for using the purchase method (‘acquisition
accounting’). The cost of a business combination is the aggregate of the fair values at the date of exchange, of assets given, liabilities incurred or assumed,
equity instruments issued by the acquirer and any costs directly attributable to the business combination.
On acquisition of a subsidiary, the assets, liabilities and contingent liabilities of a subsidiary are measured at their fair value at that date. Any excess of the
cost of acquisition over the identifiable net assets acquired is recognised as goodwill. Any deficiency of the cost of acquisition below the fair values of the
identifiable net assets acquired (i.e. discount on acquisition) is credited to the Consolidated Income Statement in the period of acquisition.
The results of subsidiaries acquired or disposed of during the year are included in the Consolidated Income Statement from the effective date of
acquisition or up to the effective date of disposal.
All intra-group transactions, balances, income and expenses are eliminated on consolidation.
Non-current assets held for sale

Non-current assets and disposal groups are classified as held for sale if their carrying amount will be recovered principally through a sale transaction rather
than continuing use. This condition is regarded as met only when a sale is highly probable and the asset (or disposal group) is available for immediate sale
in its present condition. Management must be committed to the sale, which should be expected to qualify for recognition as a completed sale within
one year from the date of classification. Disposal groups are groups of assets, and liabilities directly associated with those assets, that are to be disposed of
together as a group in a single transaction.
Non-current assets and disposal groups classified as held for sale are initially measured at the lower of carrying value and fair value less costs to sell.
At subsequent reporting dates non-current assets and disposal groups are remeasured to the latest estimate of fair value less costs to sell. As a result
of this remeasurement, any impairment is recognised as a charge in the Consolidated Income Statement. Any increase in fair value is credited to the
Consolidated Income Statement to the extent of previous impairment charges.
Discontinued operations
Discontinued operations represent cash generating units or groups of cash generating units, that have either been disposed of or classified as held for sale,
and represent a separate major line of business or are part of a single co-ordinated plan to dispose of a separate major line of business. Cash generating
units forming part of a single co-ordinated plan to dispose of a separate major line of business are classified within continuing operations until they meet
the criteria to be held for sale.
The post-tax profit or loss of discontinued operations is classified as a single line on the face of the Consolidated Income Statement, together with any
post-tax gain or loss recognised on the re-measurement to fair value less costs to sell or on the disposal of the assets or disposal group constituting the
discontinued operation.
On changes to the composition of groups of units comprising discontinued operations, the presentation of discontinued operations within prior periods
is restated to reflect consistent classification of discontinued operations across all periods presented.
Financial instruments
The Group has applied IAS 32, Financial instruments: Disclosure and presentation, IAS 39, Financial instruments: Recognition and measurement, IFRS 7, Financial
instruments: Disclosure and the complementary amendment to IAS 1, Presentation of financial statements — Capital disclosures.
Financial assets and liabilities — measurement basis

Financial assets and liabilities are recognised on the date on which the Group becomes a party to the contractual provisions of the instrument giving
rise to the asset or liability. Financial assets and liabilities are initially recognised at fair value plus transaction costs. Any impairment of a financial asset is
charged to the Consolidated Income Statement when incurred. Financial assets are derecognised when the Group’s rights to cash inflows from the asset
expire; financial liabilities are derecognised when the contractual obligations are discharged, cancelled or expire.
64

Financial assets are classified according to the purpose for which the asset was acquired. The Group’s financial assets are classified as either:
— trade and other receivables — these are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market.
They arise when the Group provides goods or services directly to a debtor, or advances money, with no intention of trading the loan or receivable.
Trade receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method, less provision for
impairment.
A provision for impairment of trade receivables is established when there is objective evidence that the Group will not be able to collect all amounts due
according to the original terms of the receivables. Significant financial difficulties of the debtor, probability that the debtor will enter bankruptcy or financial
reorganisation, and default or delinquency in payments are considered indicators that the trade receivable is impaired. The amount of the provision is the
difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the original effective interest rate. The
carrying amount of the asset is reduced through the use of an allowance account and the amount of the loss is recognised in the Consolidated Income
Statement within ‘administrative expenses’. When a trade receivable is uncollectable, it is written off against the allowance account for trade receivables.
Subsequent recoveries of amounts previously written off are credited against ‘administrative expenses’ in the income statement.
— cash and cash equivalents — these comprise deposits with an original maturity of three months or less with banks and financial institutions, bank
balances and cash on hand. Bank overdrafts are shown within borrowings in current liabilities on the balance sheet.
— monies on deposit — these comprise deposits, with an original maturity of more than three months, with banks and financial institutions. These balances
are shown within current assets on the Balance Sheet and within cash flows from financing activities in the Cash Flow Statement.
The Group’s financial liabilities are classified as either ‘current liabilities’ or ‘non-current liabilities’. These are non-derivative financial liabilities with fixed or
determinable payments that are not quoted in an active market. They arise when the Group receives goods or services directly from a creditor or supplier,
or borrows money, with no intention of trading the liability. This category includes:
— trade and other payables — these are typically non-interest bearing and following initial recognition at fair value, are included in the balance sheet at
amortised cost using the effective interest method.
— bank loans — these are initially recorded at fair value based on proceeds received, net of issue costs incurred. Borrowings are subsequently stated at
amortised cost. Any difference between the proceeds (net of transaction costs) and the redemption value is recognised in the Consolidated Income
Statement over the period of the borrowings using the effective interest method. Finance charges are accounted for on an accruals basis and charged to the
Consolidated Income Statement using the effective interest rate method.
Borrowings are classified as current liabilities unless the Group has an unconditional right to defer settlement of the liability for at least 12 months after the
balance sheet date, at which point they are classified as non-current liabilities.
Derivative financial instruments and hedge accounting — measurement basis

The Group’s activities expose it to the financial risks of changes in interest rates and the Group uses interest rate swaps to manage these exposures. The use
of derivative financial instruments is approved by the Board of Directors.
Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently remeasured at their fair value. The
method of recognising the resulting gain or loss depends on whether the derivative is designated as a hedging instrument, and if so, the nature of the item
being hedged. The Group designates certain derivatives as hedges of a particular risk associated with a recognised asset or liability or a highly probable
forecast transaction (cash flow hedge).
The Group documents at the inception of the transaction the relationship between the hedging instrument and hedged items, as well as its risk
management objectives and strategy for undertaking various hedging transactions. The Group also documents its assessment, both at hedge inception and
on an ongoing basis, of whether the derivatives that are used in hedging transactions are highly effective in offsetting changes in fair values or cash flows of
hedged items.
The fair values of various derivative instruments used for hedging purposes are disclosed in note 22. Movements on the hedging reserve in Shareholders’
equity are shown on page 60. The full fair value of a hedging derivative is classified as a non-current asset or liability when the remaining hedged item
matures in more than 12 months and as a current asset or liability when the remaining maturity of the hedged item is less than 12 months.
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Cash flow hedges

The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges is recognised in equity. The gain or loss
relating to the ineffective portion is recognised immediately in the income statement within ‘finance costs’.
Amounts accumulated in equity are recycled in the income statement in the periods when the hedged item affects profit or loss. The gain or loss relating
to the effective portion of interest rate swaps hedging variable rate borrowings is recognised in the Consolidated Income Statement within ‘finance costs’.
The gain or loss relating to the ineffective portion is recognised in the Consolidated Income Statement within ‘finance costs’. However, when the forecast
transaction that is hedged results in the recognition of a non-financial asset (for example, inventory or fixed assets), the gains and losses previously
deferred in equity are transferred from equity and included in the initial measurement of the cost of the asset. The deferred amounts are ultimately
recognised in the cost of goods sold in the case of inventory or in depreciation in the case of fixed assets.
When a hedging instrument expires or is sold, or when a hedge no longer meets the criteria for hedge accounting, any cumulative gain or loss existing in
equity at that time remains in equity and is recognised when the forecast transaction is ultimately recognised in the income statement. When a forecast
transaction is no longer expected to occur, the cumulative gain or loss that was reported in equity, is immediately transferred to the income statement
within ‘finance costs’.
The Group has no embedded derivatives that are not closely related to the host instrument.
Provisions
Provisions for onerous lease commitments, public liability insurance claims and other provisions are recognised when: the Group has a present legal or
constructive obligation as a result of past events; it is more likely than not that an outflow of economic benefits will be required to settle the obligation;
and the amount can be measured reliably.
Goodwill
Goodwill represents the excess of the cost of an acquisition over the fair value of the Group’s share of the net identifiable assets and liabilities of the
acquired business at the date of acquisition. Goodwill is recognised as an asset and is reviewed for impairment at least annually and goodwill is allocated
to cash generating units for the purpose of impairment testing at the level of reportable segment. Any impairment is recognised immediately in the
Consolidated Income Statement and is not subsequently reversed. Goodwill is carried at cost less aggregated impairment losses.
On the disposal of a subsidiary or cash generating unit, the attributable amount of goodwill is included in the determination of the profit or loss on
disposal.
Other intangible assets

Acquired trademarks are included at purchase cost and amortised over their finite useful economic lives on a straight-line basis.
Intangibles acquired separately and through business combinations, i.e. licences and other intangible assets, where material, are included at cost or fair
value respectively and amortised over their useful economic lives, being the shorter of the term of the lease to which they are attached or the licence.
Acquired software assets not integral to the operation of the related hardware are included at cost and amortised over their estimated finite useful
economic lives — three years on a straight-line basis.
The Group does not carry out research and development activities that may lead to the recognition of internally generated intangible assets. The Group’s
internally generated brands represent commercially valuable intangibles but are not eligible for recognition as assets under IAS 38, Intangible Assets.
Revenue recognition
Revenue is measured at the fair value of the consideration received or receivable and represents amounts recoverable by the Group for goods and
services provided in the normal course of business, net of discounts, VAT and other sales related taxes.
(a) Sale of goods

Sales of goods are recognised when goods are provided and the title has passed, at the point of cash receipt.
(b) Admission and services revenue

Admission revenue is recognised when the service is provided.
(c) Sub-lease rental income

Sub-lease rental income is recognised on a straight-line basis over the life of the related sub-lease agreement.
(d) Commission income

Commission income is recognised on an accruals basis in accordance with the substance of the relevant agreement.
66

Interest income
Interest income is accrued by reference to the principal outstanding and at the effective interest rate applicable, which is the rate that exactly discounts
estimated future cash receipts through the expected life of the financial asset to that asset’s net carrying amount.
Borrowing costs
Borrowing costs directly attributable to the acquisition, construction or production of assets are added to the cost of those assets, until such time as the
assets are substantially ready for their intended use or sale. All other borrowing costs are dealt with within the Consolidated Income Statement in the
period in which they are incurred.
Equity dividends
Final dividends are recognised in the Group’s financial statements in the period in which the dividends are approved by Shareholders. Interim dividends
are recognised in the period they are paid.
Dividend income
Dividend income from investments is recognised when the Shareholders’ rights to receive payment have been established.
Property, plant and equipment

All classes of property, plant and equipment are stated at cost, net of depreciation and any recognised impairment losses. Cost includes other directly
attributable costs, for example professional fees, and, for qualifying assets, borrowing costs capitalised. Depreciation is not charged during the period of
construction, and commences when the assets are ready for their intended use.
Depreciation is calculated to write down the cost or valuation, less the estimated residual value of all assets, other than land, by equal annual instalments
over their estimated useful lives.
The periods generally applicable are:
Freehold and long leasehold buildings and related structural fixtures and fittings — 50 years
Short leasehold buildings and related structural fixtures and fittings — over the period of the lease
Other fixtures and fittings, furniture and equipment — between two years and ten years
Motor vehicles — three years
Assets held under finance leases are depreciated over their expected useful lives on the same basis as owned assets or, where shorter, the term of the
relevant lease.
The assets’ residual values and useful economic lives are reviewed and adjusted, if appropriate, at each balance sheet date.
An assessment is made at each reporting date if there is any indication that an asset may be impaired. If any indications are deemed to exist, the relevant
assets are tested for impairment. Any impairment is determined as the difference between the higher of value in use, calculated by discounting an
estimate of future cash flows by the Group’s pre-tax weighted average cost of capital, and fair value less costs to sell, compared to the carrying value of the
relevant asset. Fair value less costs to sell is estimated by qualified surveyors and valuers and by applying the knowledge and experience of management,
together with external market indicators. If the recoverable amount is less than the carrying value of the asset, then the carrying value is reduced to
recoverable amount and the resulting impairment charge is recognised in the Consolidated Income Statement.
Investment in associates and joint ventures

An associate is an entity over which the Group exercises, or is in a position to exercise, significant influence, but not control or joint control, through
participation in the financial or operating policy of the investee.
Where material, the results and assets and liabilities of associates are incorporated in the financial statements using the equity method of accounting,
except when these associates are classified as held for sale. Investments in associates are carried in the balance sheet at cost adjusted by any material post-
acquisition changes in the net assets of the associates, less any impairment of value in the individual investments.
When the associate is classified as held for sale, the investment is held at the lower of adjusted cost (as described above) and fair value less costs to sell
and is no longer equity accounted for, after the date the investment is classified as held for sale.
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Inventories
Inventories are stated at the lower of cost and net realisable value. Cost is calculated using the first in, first out method.
Taxation
The tax expense represents the sum of the current tax and deferred tax.
The current tax is based on the taxable profit for the year. Taxable profit differs from profit before taxation as reported in the Consolidated Income
Statement because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never
taxable or deductible. The Group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the balance
sheet date.
Where taxation computations submitted to the taxation authorities are yet to be agreed, the Group’s estimate of tax liabilities reflects the uncertainty as
to the amount of tax that may ultimately be payable.
Deferred tax is the tax accounted for in respect of temporary differences between the carrying amounts of assets and liabilities in the financial statements
and the corresponding tax bases used in the computation of taxable profit, and is accounted for using the balance sheet liability method. Deferred tax
liabilities are recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits
will be available, against which deductible temporary differences can be utilised. Such assets and liabilities are not recognised if the temporary difference
arises from the recognition of goodwill or the initial recognition (other than in a business combination) of other assets and liabilities in a transaction that
affects neither the tax profit nor the accounting profit.
IAS 12, Income taxes, requires that the measurement of deferred tax should have regard to the tax consequences that would follow from the manner of
expected recovery or settlement, at the balance sheet date, of the carrying amount of its assets and liabilities. In calculating its deferred tax liability the
Group’s policy is to regard the depreciable amount of the carrying value of its property, plant and equipment to be recovered through continuing use in
the business, unless included within assets held for sale where the policy is to regard the carrying amount as being recoverable through sale.
Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is
charged or credited to the Consolidated Income Statement, except when it relates to items charged or credited directly to equity, in which case the
deferred tax is also dealt with in equity.
Leasing
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee. All other
leases are classified as operating leases.
Assets held under finance leases are recognised as assets of the Group at their fair value or, if lower, at the present value of the minimum lease payments,
each determined at the inception of the lease. The corresponding liability to the lessor is included in the Consolidated Balance Sheet as a finance lease
obligation. Lease payments are apportioned between finance charges and reduction of the lease obligation so as to achieve a constant rate of interest on
the remaining balance of the liability. Finance charges are recognised in the Consolidated Income Statement within finance costs, unless they are directly
attributable to qualifying assets, in which case they are capitalised.
Rentals payable under operating leases are charged to the Consolidated Income Statement on a straight-line basis over the term of the relevant lease.
Benefits received and receivable as an incentive to enter into an operating lease are included within deferred income and recognised in the Consolidated
Income Statement on a straight-line basis over the lease term. Premiums paid on entering into the lease of certain leasehold land and buildings are
classified as other non-current assets and amortised to the Consolidated Income Statement over the life of the relevant lease.
Leased assets that are sub-let to third parties are classified according to their substance as either finance or operating leases. All such arrangements the
Group has entered into as lessor are operating leases. Income received as a lessor is recognised on a straight-line basis over the lease term and is classified
in the Consolidated Income Statement as revenue.
68

Leases that are entered into following the sale of assets by the Group (i.e. ‘sale and leaseback transactions’) are classified according to the risk and rewards
of the lease. All such arrangements entered into by the Group are operating leases. Where the proceeds on sale of the asset exceed the asset’s fair value
and the asset is leased back as an operating lease, any surplus over the fair value is treated as deferred income and recognised in the Consolidated Income
Statement over the term of the lease on a straight-line basis.
Segmental reporting
Segment information is presented in accordance with IFRS 8. The management approach required by IFRS 8 stipulates that the internal reporting
organisation used by management for making decisions on operating matters should be used to identify the Group’s reportable segments and the
internal performance measure should be used as the segment result.
Employee benefits
Retirement benefit costs
Payments made to defined contribution retirement benefit schemes are charged as an expense when they fall due. The Group has no defined benefit or
other retirement benefit schemes.
Share-based compensation
The Group has applied the requirements of IFRS 2, Share-based payment. In accordance with the transitional provisions, IFRS 2 has been applied to all
grants of equity instruments after 7 November 2002 that were unvested as of 1 January 2005.
The Group issues some equity instruments where the counter-party has the choice of either cash or equity settlement and some equity instruments
where the settlement can only be in equity.
Equity-settled share-based payments are measured at fair value at the date of grant. The fair value determined at grant date is expensed on a straight-
line basis over the vesting period, based on the Group’s estimate of the shares that will actually vest, with a corresponding credit entry directly to equity
reserves. Fair value is measured by means of a stochastic model.
A liability is recognised at current fair value at each balance sheet date for cash settled share-based payments, with changes in the fair value recognised in
the Consolidated Income Statement.
Shares held in Employee Share Option Plan (“ESOP”) trusts are presented as a deduction from equity. Transactions between the Group and the ESOP
trust are eliminated on consolidation.
Critical accounting policies and estimates

Income taxes
Significant judgement is required in determining the provision for income taxes. There are many transactions and calculations for which the ultimate tax
determination is uncertain during the ordinary course of business. The Group recognises the liabilities for anticipated tax audit issues based on estimates
of whether additional taxes will be due.
In addition, any reduction in the corporation tax liability as a result of business activities undertaken in a tax efficient manner, is fully provided for and
released in accordance with the techniques identified by IAS 37, Provisions, contingent liabilities and contingent assets. Where significant progress has
been made towards agreement with the relevant tax authority, the total expected value approach is utilised. In all other cases, the most likely outcome
approach is used.
Deferred tax
The Group has made provision for deferred tax arising following the requirements of IAS 12, Income taxes, using estimates based on the current manner
of recovery of the assets’ value of property, plant and equipment not eligible for capital allowances, i.e. recovery of the depreciable amount through
continued use in the business unless the assets are held for sale. This method assumes that no tax relief will be available until the value of the asset is
recovered through sale rather than continued use.
Upon any change to the manner of recovery of the assets’ value, the change to the level of deferred tax provided will be recognised through the
Consolidated Income Statement during the period in which the change in the method of recovery occurs. Any changes to the expected manner of
recovery could result in a significant change to the deferred tax charge or credit to the Consolidated Income Statement.
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Impairment of property, plant and equipment and goodwill

The Group has tested property, plant and equipment and goodwill for impairment following the requirements of IAS 36, Impairment of assets.
These impairment tests are dependent on estimates of value in use and fair value less costs of sale, to determine the recoverable amounts of cash
generating units.
Fair value less costs of sale is determined using external and internal estimates of the value of the Group’s units. Value in use is calculated using estimated
earnings and cash flows derived by internal management estimates and a discount applied to these cash flows.
Any changes to the level of forecast earnings or cash flows could impact upon the value in use of these cash generating units. Management have
performed the annual impairment review of goodwill as required by IAS 36 (see note 10, ‘Goodwill’).
Onerous lease provisions

The Group provides for its onerous obligations under operating leases where the property is closed or vacant and the Group believes that it is more likely
than not that the property will not be redeveloped for use in the Group’s business. Provision is made for rent and other property related costs for the
period Management believe a sub-let or assignment of the lease is not possible.
Where the Group believes the lease is likely to be assigned, provision is made for the Group’s best estimate of the reverse lease premium payable, if this
represents the least cost to the Group from exiting from the obligation.
The estimated timings and amounts of cash flows are determined using the experience of internal and external property experts, however, any changes to
the estimated method of exiting from the property could lead to significant changes to the level of the provision recorded.
70
Notes to the Consolidated Financial Statements

1 Segmental reporting
For the year ended 26 February 2009, the Group early adopted IFRS 8, Operating segments. IFRS 8 replaces IAS 14, Segment Reporting.
IFRS 8 requires operating segments to be identified on the basis of internal reports about components of the Group that are regularly reviewed by
the Chief Operating Decision Maker (“CODM”) to allocate resources to the segments and to assess their performance.
We report our segment information on the same basis as our internal management reporting structure, which drives how our Company is organised
and managed.
The Group is principally engaged as owner, developer and operator of nightclubs and themed bars in the UK. The CODM has been identified as the
Senior Executive Management (“SEM”) that exercises the day-to-day management function of the Group. Operational and financial information,
which is primarily at an individual venue level, is received by the CODM on a monthly basis. Luminar do not distinguish between geography or brand.
The venue information does not meet the quantitative thresholds as required by IFRS 8, as such management have judged it appropriate to aggregate
the financial information relating to all venues into a single reportable segment.
All revenue is earned from sales to external customers.
2 Revenue and (loss)/profit from operations for the year

An analysis of the Group’s revenue for the year is as follows:
Continuing Discontinued Total Continuing Discontinued Total
£m £m £m £m £m £m
Sale of goods 120.7 0.4 121.1 132.7 0.9 133.6

Admission and services revenue 50.9 — 50.9 59.2 0.3 59.5
Sub-lease rental income 0.5 0.1 0.6 0.5 0.2 0.7
Commission income 1.0 — 1.0 0.8 — 0.8

173.1 0.5 173.6 193.2 1.4 194.6
All revenue results from transactions with external customers.
A further analysis of the Group’s results for the year is as follows:

£m £m £m £m £m £m
Revenue 173.1 0.5 173.6 193.2 1.4 194.6

Cost of sales (30.2) (0.1) (30.3) (34.1) (0.3) (34.4)

Gross profit 142.9 0.4 143.3 159.1 1.1 160.2
Administrative expenses (245.9) (27.6) (273.5) (140.3) (30.7) (171.0)

(Loss)/profit from operations (103.0) (27.2) (130.2) 18.8 (29.6) (10.8)
Continuing administrative expenses include £114.6m (2009: £9.8m) of exceptional items (see note 8). Discontinued administrative expenses include
£26.5m (2009: £29.3m) of exceptional items (see note 8).
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2 Revenue and (loss)/profit from operations for the year (continued)

(Loss)/profit from operations for the year is stated after:
£m £m £m £m £m £m
Auditors’ remuneration:
— audit of the financial statements
pursuant to legislation 0.1 — 0.1 0.1 — 0.1
— other services relating to taxation 0.2 — 0.2 0.3 — 0.3
— other services provided pursuant to legislation 0.1 — 0.1 — — —
Depreciation of property, plant and equipment
(see note 12):
— owned assets 21.7 0.1 21.8 21.1 0.1 21.2
— finance leased assets 0.1 — 0.1 1.0 — 1.0
Amortisation of intangibles (see note 11) 0.8 — 0.8 0.5 — 0.5
Amortisation of non-current assets (see note 13) 0.1 — 0.1 0.2 — 0.1
Operating lease rentals of land and buildings 13.4 0.2 13.6 12.1 0.3 12.4
Sub-lease rents receivable and other income (0.6) (0.1) (0.7) (0.5) (0.2) (0.7)
Employee benefit expense (see note 4) 32.6 0.1 32.7 35.3 0.2 35.5
Costs of inventories recognised as an expense 30.2 0.1 30.3 34.1 0.3 34.4
Realised loss on disposal of motor vehicles — — — 0.1 — 0.1
Net impairment of property, plant and equipment:
— owned assets 63.8 0.3 64.1 7.4 1.5 8.9
Goodwill impairment (see note 10) 41.1 — 41.1 0.7 — 0.7
Costs of reorganisation and rationalisation 1.5 — 1.5 0.6 2.8 3.4
3 Net finance costs

Net finance costs relating to continuing operations were as follows:
2010 2009
£m £m
Interest payable on bank borrowings (7.7) (9.8)

Interest payable on obligations under finance leases (0.4) (0.4)
Amortisation of issue costs of the bank loan (note 18) (0.2) (0.2)

Total borrowing costs (8.3) (10.4)
Less amounts capitalised in the cost of qualifying assets — 0.3

Finance costs (8.3) (10.1)

Income on bank deposits 0.1 0.1
Interest on loan to associate 0.9 1.7
Fair value movement on derivatives not hedge accounted for 0.1 —

Finance income 1.1 1.8

Net finance costs (7.2) (8.3)
Finance costs relating to discontinued operations, being interest payable on obligations under finance leases, totalled £nil (2009: £nil).
Interest capitalised in the cost of qualifying assets is calculated using the borrowing rate obtainable by the Group under its current facility at the start
of each financial year. Interest is calculated from the date capital expenditure commences until the opening of the relevant venue.
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Notes to the Consolidated Financial Statements (continued)

4 Directors and employees

Employee costs charged during the year were as follows:
£m £m £m £m £m £m
Wages and salaries 29.4 0.1 29.5 31.9 0.2 32.1

Social security costs 2.2 — 2.2 2.5 — 2.5
Expense recognised in respect of share-based payments 0.5 — 0.5 0.3 — 0.3
Pension costs 0.5 — 0.5 0.6 — 0.6

32.6 0.1 32.7 35.3 0.2 35.5
The Group operates defined contribution pension schemes. The assets of these schemes are held separately from those of the Group. The pension
cost is shown above.
The average monthly number of employees (including weekly paid staff) of the Group, for both continuing and discontinued operations, during the
year was:
Administration centre 134 1 135 144 2 146

Operations 2,943 14 2,957 3,150 24 3,174

3,077 15 3,092 3,294 26 3,320
Remuneration in respect of key management of the Group (including Directors) was as follows:
2010 2009
£000 £000
Aggregate emoluments 2,547 3,056

Group contributions to money purchase pension schemes 230 324

2,777 3,380
Expense recognised in respect of share-based payments 201 52

2,978 3,432
All remuneration relating to key management is recorded within continuing operations.
During the year, key management consisted of 16 managers (including Directors) (2009: 15).
Remuneration in respect of Directors (including Non-Executive Directors) of Luminar Group Holdings plc was as follows:
2010 2009
£000 £000


1,165 1,359
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4 Directors and employees (continued)

During the year, the Group had six (2009: six) Directors, including Non-Executive Directors, providing services. During the year, two Directors (2009:
two) participated in a defined contribution pension scheme.
During the year, none of the Directors exercised share options (2009: two Directors) and no Directors were awarded shares. The amounts set out
below are the aggregate gains made by Directors on the exercise of share options:
2010 2009
£000 £000
S Thomas — 26
N Beighton — 60

— 86
Details of options giving rise to these gains can be found on pages 46 to 48. The gains are calculated as at the date of exercise.
The amounts set out above include remuneration of the highest paid Director as follows:
2010 2009
£000 £000
Aggregate emoluments 501 578


587 694
More detailed audited information concerning remuneration of Directors is included in the Remuneration Report on pages 40 to 48.
5 Tax on (loss)/profit
(a) Analysis of charge in period
The taxation charge is based on the loss for the year and represents:
2010 2009
£m £m
Current tax CREDIT/(charge)

— Continuing operations:
— Current period (3.0) (6.6)
— Adjustments from prior periods 2.1 1.9
— Discontinued operations:
— Current period 3.0 0.2

2.1 (4.5)
Deferred tax credit
— Continuing operations 11.9 1.6
— Discontinued operations 0.3 0.5

12.2 2.1
Total taxation CREDIT/(charge)
— Continuing operations 11.0 (3.1)
— Discontinued operations 3.3 0.7

14.3 (2.4)
74

5 Tax on (loss)/profit (continued)

(b) Tax on items credited to equity
2010 2009
£m £m
Derivative financial instruments 0.2 2.9

0.2 2.9
(c) Factors affecting tax charge for period

The tax assessed for the period is higher (2009: higher) than the standard rate of corporation tax in the UK. The differences are explained as follows:
2010 2009
£m £m
(Loss)/profit on ordinary activities from continuing operations before tax (110.2) 10.5

(Loss)/profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 28% (2009: 28%) 30.9 (2.9)
Effects of:
Expenses not deductible for tax purposes (3.7) (0.1)
Non-deductible exceptional items (11.5) (2.7)
Adjustments in respect of the prior year 2.1 1.9
Non-qualifying depreciation (6.8) 0.7

Total tax CREDIT/(CHARGE) from continuing operations for the year 11.0 (3.1)
6 Dividends
2010 2009
£m £m
Ordinary shares — previous year final dividend paid: nil pence per share (2009: 13.95 pence per share) — 8.5
Ordinary shares — current year interim dividend paid: nil pence per share (2009: 5.37 pence per share) — 3.3

— 11.8
The Directors are not proposing a final dividend in respect of the current financial year.
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7 (Loss)/Earnings per share

The basic earnings per share (“EPS”) is calculated by dividing the earnings attributed to equity shareholders by the weighted average number of shares
in issue during the year. For diluted EPS the weighted average number of ordinary shares in issue is adjusted to assume conversion of all dilutive
potential ordinary shares. The Group has two classes of dilutive potential ordinary shares: share options granted to Directors and employees where
the exercise price is less than the average market price of the Group’s ordinary shares during the year; and the contingently issuable shares under the
Group’s long-term incentive plan. At the year end, an assessment is made as to whether the performance criteria for the vesting of awards under the
share option schemes of the Group is likely to be met and any potential shares unlikely to be exercised are excluded from the diluted EPS calculation.
An alternative measure of EPS has also been presented below, that being EPS from continuing operations pre-exceptional items, as the Directors
believe that this measure of pre-exceptional earnings from continuing operations is more reflective of the ongoing trading of the Group.
Reconciliation of the earnings and weighted average number of shares used in the calculations are set out below:
Year ended 25 February 2010

Weighted
average
(Loss)/ number Per share
earnings of shares amount
£m (in millions) (pence)
Basic and diluted EPS

Loss attributable to ordinary Shareholders (123.1) 82.4 (149.4)

Basic and diluted EPS from continuing operations (99.2) 82.4 (120.4)

Basic and diluted EPS from discontinued operations (23.9) 82.4 (29.0)

EPS from continuing operations pre-exceptional items
Basic and diluted EPS from continuing operations pre-exceptional items 5.1 82.4 6.2
At 25 February 2010, as the Group is loss-making any share options in issue are considered to be ‘anti-dilutive’ and as such, the calculation is the
same for both basic and diluted earnings per share.
Year ended 26 February 2009

Weighted
average
(Loss)/ number Per share
earnings of shares amount
£m (in millions) (pence)
Basic and diluted EPS

Loss attributable to ordinary Shareholders (21.5) 60.9 (35.3)

Basic and diluted EPS from continuing operations 7.4 60.9 12.2

Basic and diluted EPS from discontinued operations (28.9) 60.9 (47.5)

EPS from continuing operations pre-exceptional items
Basic and diluted EPS from continuing operations pre-exceptional items 15.8 60.9 25.9
At 26 February 2009, as the Group was loss-making any share options in issue are considered to be ‘anti-dilutive’ based on the exercise price and the
weighted average market price and as such, the calculation is the same for both basic and diluted earnings per share.
All amounts included in the column headed ‘(Loss)/earnings’ are taken from the face of the Consolidated Income Statement on page 57.
76

8 Exceptional items
(a) Continuing operations
The Group incurred exceptional items on continuing operations as follows:
2010 2009
£m £m
Exceptional items relating to trading

Impairment of property, plant and equipment (63.8) (7.4)
Provision for loss on liquidation of supplier (0.8) —
Catch up of depreciation on units no longer held for sale — (0.5)
Costs relating to reorganisation and rationalisation (1.5) (0.6)
Impairment of goodwill (41.1) (0.7)
Impairment of lease premiums (1.9) —
Net movement on provision for onerous lease commitments (3.5) (0.3)
Legal settlement — (0.3)
Provision against carrying value of memorabilia stock (0.6) —
Provision against receivable due from associate (0.7) —
Costs relating to aborted projects (0.7) —

Pre-tax exceptional items relating to continuing operations (114.6) (9.8)
Tax on exceptional items 10.3 1.4

Post-tax exceptional items relating to continuing operations (104.3) (8.4)
The impairment of property, plant and equipment of £63.8m (2009: £7.4m) and impairment of lease premiums of £1.9m (2009: £nil) reflects the
difference between the value in use of the venues and their carrying value. An impairment review was triggered on these assets due to the tough
trading conditions seen through the year, resulting in reduced profit contributions.
Costs of reorganisation and rationalisation of £1.5m (2009: £0.6m) primarily relate to redundancy and termination costs incurred in respect of internal
restructures. The prior year costs related mainly to previous restructures.
The impairment of goodwill of £41.1m (2009: £0.7m) has arisen following the annual impairment test to compare the carrying value of the cash
generating units to their recoverable value (their value in use).
The charges arising from onerous lease commitments of £3.5m (2009: £0.3m) were to recognise the obligation for rent, rates and other property
related holding costs on currently vacant or closed venues, where the likelihood of assignment of the lease or sub-let of the property is unlikely in the
short term. These venues are closed or vacant due to them being unprofitable and unsuitable for re-branding.
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8 Exceptional items (continued)

(b) Discontinued operations
The Group incurred exceptional items relating to discontinued operations as follows:
2010 2009
£m £m
Impairment of property, plant and equipment (0.3) (1.5)

Impairment of investment in associate (3.6) (24.1)
Provision against receivable due from associate (23.7) —
Costs relating to reorganisation and rationalisation — (0.7)
Net movement on provision for onerous lease commitments 0.3 (0.5)
Realised loss on disposal of the Entertainment Division — (0.4)
Realised profit on disposals 0.3 0.7

(27.0) (26.5)
Costs associated with the disposal of companies:

Provision for cash injection into businesses — (1.4)
Transaction costs including advisors’ fees — (0.9)

— (2.3)
Indemnity provision 0.5 (0.5)

0.5 (2.8)
Pre-tax exceptional items relating to discontinued operations (26.5) (29.3)
Tax on exceptional items 3.0 0.6

Post-tax exceptional items relating to discontinued operations (23.5) (28.7)
The impairment of property, plant and equipment of £0.3m (2009: £1.5m) has resulted from remeasuring to fair value less costs of sale venues held
for sale.
A non-cash impairment of £3.6m (2009: £24.1m) has been recognised against the carrying value of the Group’s investment in 3DE, reflecting the fact
that 3DE has gone into administration. A further £23.7m (2009: £nil) has been provided against the carrying value of the vendor loan note (and
related accrued interest).
The credit in relation to the disposal of companies of £0.5m (2009: £2.8m charge) relates to a release of brought forward provisions, for which the
relative amounts are no longer payable, due to the companies disposed of having been placed into liquidation and administration during the year.
78

9 Discontinued operations and non-current assets held for sale

(a) Results of discontinued operations
The results of discontinued operations, which comprise those of the 26 venues sold to Cavendish Bars Limited for which the sale did not complete
prior to this financial year and other non-core venues, either disposed of or held for sale, forming part of the Group’s plan to exit from non-core
operations, included within the Consolidated Income Statement were as follows:

2010 2009
£m £m
Revenue 0.5 1.4

Administrative expenses (1.2) (1.7)

Loss before tax pre-exceptional items (0.7) (0.3)
Attributable tax credit 0.3 0.1

Loss after tax pre-exceptional items (0.4) (0.2)
Exceptional items (see note 8) (26.5) (29.3)
Attributable tax credit 3.0 0.6

Loss from discontinued operations (23.9) (28.9)
The impairment of the Group’s investment in 3DE and the provision against the related receivable balance, are the primary reasons for the loss from
discontinued operations (see note 8, ‘Exceptional Items’).
(b) Cash flow from discontinued operations

The Consolidated Cash Flow Statement on page 59 includes the following cash flows arising from discontinued operations:

2010 2009
£m £m
Net cash flows from operating activities (5.3) (11.0)

Net cash flows from investing activities (0.1) 3.5

(5.4) (7.5)
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9 Discontinued operations and non-current assets held for sale (continued)

(c) Assets and liabilities of venues held for sale
As at 25 February 2010, five venues (2009: nine venues) were classified as held for sale, of which four (2009: eight) of the venues were reported within
discontinued operations and the remaining venue was reported within continuing operations.
The major classes of assets and liabilities comprising the venues classified as held for sale were as follows:
2010 2009
£m £m
Property, plant and equipment 2.0 2.3

Trade and other receivables 0.1 0.1
Cash and cash equivalents — —

Total assets classified as held for sale 2.1 2.4
Trade and other payables (0.1) (0.1)

Provisions (0.5) (5.8)
Deferred tax liabilities (0.1) (0.1)

Total liabilities classified as held for sale (0.7) (6.0)

Net assets/(liabilities) classified as held for sale 1.4 (3.6)
The total loss of £1.6m (2009: £2.0m) incurred in writing these assets down to fair value less costs to sell has been included in exceptional items
(see note 8).
80

10 Goodwill
£m
Cost
Brought forward at 27 February 2009 183.6

At 25 February 2010 183.6

Accumulated impairment losses
Impairment in the year 41.1


Carrying amount
£m
Cost
Disposals (3.0)


Accumulated impairment losses
Disposals (3.0)
Impairment in the year 0.7


Carrying amount
The majority of the Group’s goodwill arose from the acquisition of venues from either Allied Leisure plc on 6 December 1999 or from Northern
Leisure Plc on 11 July 2000, excluding the £8.1m of goodwill that arose on the acquisition of 13 venues from The Nightclub Company in 2005 and the
£0.6m of goodwill on acquisitions in 2008.
No acquisitions occurred during the year giving rise to goodwill additions.
A Cash Generating Unit (“CGU”) is deemed to be an individual operating venue, as each venue generates profits and cash flows that are largely
independent from other venues. Where multiple CGUs are acquired as part of a single business combination, the goodwill arising from the business
combination is attributed to individual CGUs but is grouped together. Accordingly, CGUs have been grouped together for the purpose of the
annual impairment review of goodwill.
Impairment of goodwill
In assessing whether a write-down of goodwill is required to the carrying value of the related asset, the carrying value of the combined CGUs, is
compared with its recoverable amount. The recoverable amount for each CGU, and collectively for the combined CGUs, has been measured based
on value in use (“VIU”), with the exception of those venues that were held for sale at the balance sheet date, where the recoverable amount for these
venues has been based on the lower of cost and fair value less costs to sell.
For the purposes of the annual impairment review, the recoverable amount has been estimated on the VIU basis.
The Group estimates the VIU of its CGUs using a discounted cash flow model (“DCF”), which adjusts the cash flows for risks associated with the
assets, and are discounted using a pre-tax rate of 11.4% (2009: 10.1%).
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10 Goodwill (continued)
The VIU calculations have not included the benefits arising from any future asset enhancement expenditure, as this is not permitted by IAS 36. The
VIU calculations therefore exclude any benefits anticipated from future asset enhancing refurbishments together with the related capital expenditure.
Management have performed the annual impairment review of goodwill as required by IAS 36. As a result, an impairment of £41.1m has been booked
in the year to 25 February 2010 (2009: £0.7m). None of this impairment (2009: £0.7m) of goodwill was in relation to venues held for sale.
Key assumptions
The key assumptions are based upon our own historical experience. The calculation of VIU is most sensitive to the following assumptions:
Sales and EBITDA — this is based on formally approved budgets for the first year. These have then been forecast for years two to five based on
expected sales growth;
Discount rate — this reflects the Directors’ estimate of an appropriate rate of return, taking into account the relevant risk factors; and
Growth rate used to extrapolate beyond the budget period and for terminal values — based upon the long-term average growth rate of the UK of
2.2%. Management recognise that the leisure market growth rates fluctuate both above and below this rate.
Sensitivity to changes in assumptions

The impairment calculation is sensitive to changes in the above assumptions, primarily in relation to EBITDA forecast assumptions. A 5% decrease in
EBITDA forecast would result in a further impairment being required of £23.5m.
11 Other intangible assets

2010
Software Trademarks Licences Total
£m £m £m £m
Cost
Brought forward at 27 February 2009 5.1 0.1 0.4 5.6
Additions 0.3 — — 0.3

At 25 February 2010 5.4 0.1 0.4 5.9

Amortisation
Brought forward at 27 February 2009 2.4 — 0.1 2.5
Charge 0.8 — — 0.8

At 25 February 2010 3.2 — 0.1 3.3

Net book amount at 25 February 2010 2.2 0.1 0.3 2.6
82

11 Other intangible assets (continued)

2009
Software Trademarks Licences Total
£m £m £m £m
Cost
Additions 1.3 — — 1.3
Disposals (0.1) — — (0.1)

At 26 February 2009 5.1 0.1 0.4 5.6

Amortisation
Brought forward at 29 February 2008 2.0 — 0.1 2.1
Charge 0.5 — — 0.5
Disposals (0.1) — — (0.1)

At 26 February 2009 2.4 — 0.1 2.5

Net book amount at 26 February 2009 2.7 0.1 0.3 3.1
12 Property, plant and equipment

2010
Long Short Fixtures,
Freehold leasehold leasehold fittings,
land and land and land and furniture and Motor
buildings buildings buildings equipment vehicles Total
£m £m £m £m £m £m
Cost
Brought forward at 27 February 2009 54.4 3.7 106.2 319.7 0.9 484.9
Additions — — — 3.8 — 3.8
Disposals — — — (0.6) — (0.6)
Net transfers to assets held for sale — — — (3.9) — (3.9)

At 25 February 2010 54.4 3.7 106.2 319.0 0.9 484.2

Depreciation
Depreciation charge 1.7 0.6 3.2 16.4 — 21.9
Impairment 15.0 1.2 10.6 35.6 — 62.4
Disposals — — — (0.3) — (0.3)
Net transfers to assets held for sale — — — (2.7) — (2.7)

At 25 February 2010 20.8 3.1 46.3 186.2 0.9 257.3

Net book amount at
25 February 2010 33.6 0.6 59.9 132.8 — 226.9
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12 Property, plant and equipment (continued)

2009
Long Short Fixtures,
Freehold leasehold leasehold fittings,
land and land and land and furniture and Motor
buildings buildings buildings equipment vehicles Total
£m £m £m £m £m £m
Cost
Additions — — — 31.2 0.2 31.4
Disposals — — — (11.3) (0.7) (12.0)
Net transfers from assets held for sale — — — 3.9 — 3.9

At 26 February 2009 54.4 3.7 106.2 319.7 0.9 484.9

Depreciation
Depreciation charge 0.8 0.4 3.3 17.5 0.2 22.2
Impairment — — — 6.9 — 6.9
Disposals — — — (1.0) (0.4) (1.4)
Net transfers from assets held for sale — — — 1.3 — 1.3

At 26 February 2009 4.1 1.3 32.5 137.2 0.9 176.0

Net book amount at
26 February 2009 50.3 2.4 73.7 182.5 — 308.9
The transfer of assets from property, plant and equipment to assets held for sale relates to one additional venue which was classified as held for sale at
the balance sheet date.
The impairment of property, plant and equipment of £62.4m (2009: £6.9m) reflects the difference between the VIU of the venues and their carrying
value. An impairment review was triggered on these assets due to the tough trading conditions seen through the year, resulting in reduced profit
contributions. VIU has been calculated using a post-tax discount rate of 11.4% and a long-term growth rate of 2.2%.
Assets in the course of construction, classified within fixtures, fittings, furniture and equipment, total £nil (2009: £nil).
Assets held under finance leases have the following net book amount:
2010 2009
£m £m
Cost 7.3 7.3

Accumulated depreciation and impairment losses (1.0) (0.9)

Net book amount 6.3 6.4
Assets held under finance leases relate to the building component of properties held under long leases.
84

13 Other non-current assets

2010 2009
£m £m
Other non-current assets 1.9 3.9
Other non-current assets relate to lease premiums paid in relation to property leases.
An impairment of £1.9m (2009: £nil) has been charged during the year (see note 8, ‘Exceptional Items’). This impairment arose due to the tough
trading conditions seen during the year, resulting in reduced profits being generated by venues.
14 Principal subsidiaries, associates and joint ventures

Subsidiary undertakings
The Group’s principal subsidiary undertakings, all of which are wholly owned and which have been consolidated into these financial statements, are
listed below together with details of their businesses:
Class of Proportion Nature of
share capital held business
Luminar Holdings Limited Ordinary 100% Holding Company

Luminar Oceana Limited Ordinary 100% Licensed premises
Luminar Lava Ignite Limited Ordinary 100% Licensed premises
Luminar Liquid Limited Ordinary 100% Licensed premises
Luminar Gems Limited Ordinary 100% Licensed premises
Luminar Leisure Limited (formerly Luminar Properties Limited) Ordinary 100% Licensed premises and
Group service provider
Luminar Finance Limited Ordinary 100% Financing Company
Luminar Dancing Finance Limited Ordinary 100% Holding Company
Luminar Finance (2006) Limited Ordinary 100% Financing Company
Luminar Entertainment (2006) Limited Ordinary 100% Holding Company
Luminar Dancing (2006) Limited Ordinary 100% Holding Company
Luminar Entertainment Finance Limited Ordinary 100% Financing Company
Jam House Holdings Limited Ordinary 100% Holding Company
Luminar Holdings 2 Limited Ordinary 100% Holding Company
Evered Employee Benefit Trustees Limited (registered in Jersey) Ordinary 100% Trustee Company
Luminar Brands Limited Partnership Incorporated (registered in Guernsey) Partnership interest 100% Brand ownership
Unless otherwise stated, all subsidiaries are registered in England and Wales. Luminar Group Holdings plc is registered and domiciled in England
and Wales.
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14 Principal subsidiaries, associates and joint ventures (continued)

Investment in associate
£m

Impairment of investment in associate (3.6)

Carried forward at 25 February 2010 —
Interests in associates represents the Group’s interest in the issued ordinary share capital of 3DE (49%), which was equity accounted for in accordance
with IAS 28, Investments in associates, up to the date the investment was classified as held for sale, and Eminence Leisure Limited (20%), which was
equity accounted for in accordance with IAS 28, Investments in associates, up to the date the company went into liquidation. All of the Group’s
associated undertakings are registered in England and Wales.
The 3D Entertainment Group Limited

3DE went into administration on 26 February 2010, resulting in the Group’s carrying value of its investment in the associate being fully impaired as at
the financial year end of 25 February 2010. This impairment has been disclosed within discontinued operations as the investment was classified as
held for sale in the prior year and hence no share of the profits and losses of 3DE has been recorded.
Eminence Leisure Limited

The cost of investment, the cumulative post-acquisition share of the after tax profit and the cumulative post-acquisition share of reserve movements
of this associate was less than £50,000 and, accordingly, when rounded does not appear in the presentation of these financial statements.
Eminence Leisure Limited went into liquidation on 30 September 2009. As a result, the outstanding receivable balance has been fully provided against
in the financial statements for the year ended 25 February 2010.
Interests in joint ventures

In 2005/2006, the Group entered into an arrangement with Lucien Barriere to form a joint venture company called Waterimage Limited, a company
incorporated in England and Wales. Both parties own a 50% shareholding in the company, representing one £1 share each. No trading took place in
the company during the year or the prior year.
86

15 Inventories
2010 2009
£m £m
Goods held for resale 1.5 2.1
A provision of £0.6m (2009: £nil) has been charged to the profit and loss during the year in relation to reducing memorabilia stock down to its
expected recoverable value (see note 8, ‘Exceptional Items’).
16 Trade and other receivables

2010 2009
£m £m
Trade receivables 1.5 2.1

Receivables from related parties — 22.7
Other debtors 0.8 1.3
Prepayments and accrued income 3.3 4.0

5.6 30.1
Less non-current portion: receivables from related parties — (22.7)

Current portion 5.6 7.4
Receivables from related parties in the prior year comprise a £19.3m unsecured loan note and £3.4m accrued interest receivable from 3DE in relation
to the disposal of the Entertainment Division. An arm’s length fixed interest rate of 8% per annum is payable on the loan note. The loan note and
interest are due for repayment on the earlier of a subsequent sale of the business, refinancing or January 2014. In the current year, the balance owed
has been fully provided against due to 3DE having gone into administration on 26 February 2010.
The carrying value less the impairment provision of trade receivables approximates their fair values. The carrying value of receivables from related
parties and other debtors approximates their fair values.
Trade receivables are analysed on a case by case basis for the purpose of identifying any impairments and are disclosed net of any such impairments.
The majority of trade debtors are on 30 day terms post-invoice date. The ageing analysis of these trade receivables was as follows:
2010 2009
£m £m
Not past due:

Within 30 days after invoice date 0.4 1.0
Past due:
31–60 days after invoice date 0.4 0.3
61–90 days after invoice date 0.3 0.3
Over 90 days after invoice date 0.4 0.5

1.1 1.1

TOTAL 1.5 2.1
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16 Trade and other receivables (continued)

Included within trade receivables at the year end was a balance of £1.0m (2009: £0.4m) with 3DE relating to recharges for the Group’s services. This
balance has been provided for in full (net of VAT) as the company is now in administration.
Unprovided trade receivables are not considered impaired due to significant cash collection of these receivables post-year end and an agreed
payment profile for the older debtors. Trade receivables are spread over a number of counter-parties and as such credit risk is perceived to be low.
Movements on the Group provision for impairment of trade receivables were as follows:
2010 2009
£m £m
Brought forward at the start of the year — —

Charged to Consolidated Income Statement 0.9 —

Balance carried forward at the end of the year 0.9 —
£0.8m of the provision for impairment of trade receivables relates to 3DE, which has gone into administration. £0.2m of the balance was less than 30
days past invoice date, £0.3m was between 30 and 60 days past the invoice date and £0.3m was over 90 days past the invoice date.
A further provision of £0.1m has been made for other balances due from companies which have gone into liquidation, all of which were over 90 days
past the invoice date.
17 Cash and cash equivalents

2010 2009
£m £m
Cash at bank and in hand 37.3 27.9
Of this balance, £0.1m (2009: £0.2m) relates to rental deposits held on behalf of sub-let tenants.
2010 2009
£m £m
Monies on deposit 10.0 —
The £10.0m (2009: £nil) cash deposits relate to monies placed on deposit which mature in greater than three months.
88

18 Borrowings and loans

Amounts falling due after more than one year were as follows:
2010 2009
£m £m
Non-current:
Bank loans 140.0 170.0
Issue costs (0.1) (0.3)

139.9 169.7
Borrowings mature in August 2012 and bear interest of LIBOR, reset every month, plus a margin of up to 0.75%. The bank loans are secured
via a floating charge over all of the Group’s assets.
The fair value of bank borrowings at 25 February 2010 equalled the bank loan balance of £140.0 (2009: £170.0m) plus accrued interest of £nil
(2009: £nil).
The Group’s undrawn floating facilities at the balance sheet date were as follows:
2010 2009
£m £m
Expiring after two years 35.0 5.0
In addition to a total bank loan facility of £175.0m (2009: £175.0m), the Group also has an overdraft facility of £5.0m (2009: £5.0m).
19 Trade and other payables

2010 2009
£m £m
Trade payables 4.8 5.2

Social security and other taxes 2.2 4.8
Accruals 6.2 6.9
Other creditors 0.9 0.9

14.1 17.8
The carrying values of trade payables are not materially different to their fair values.
20 Current tax liabilities

2010 2009
£m £m
Current tax liabilities 42.8 42.7
Current tax liabilities include amounts provided for as a result of business activities undertaken in a tax efficient manner, pending agreement with
the relevant tax authority. The amount provided will be paid or released to the Consolidated Income Statement in accordance with the techniques
identified by IAS 37, Provisions, contingent liabilities and contingent assets.
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21 Deferred income
Deferred income has been analysed between current and non-current as follows:
2010 2009
£m £m
Current 0.5 0.5

Non-current 6.1 6.3

6.6 6.8
Deferred income includes the deferred profit represented by the excess of consideration received above the assessed fair value on the sale and
leaseback transactions completed in prior years, together with the deferred lease incentives and rent-free periods received on the Group’s operating
leases.
22 Financial instruments
Financial Risk Management
Financial Risk Factors
The Group’s activities expose it to a variety of financial risks: market risk (predominately cash flow interest rate risk); credit risk; and liquidity risk. The
Group’s overall risk management programme focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on
the Group’s financial performance. The Group uses derivative financial instruments to hedge certain risk exposures.
a) Market risk
i) Currency risk
The Group operates predominately within the UK and substantially all transactions are denominated in sterling. Therefore, the Group does not suffer
from a significant concentration of currency risk.
ii) Price risk

The Group is not exposed to equity security price risk or commodity price risk.
In addition to the financial instruments described in the measurement basis sections above, the Group also has the following financial instruments,
for which additional disclosures are included in the notes to the financial statements:
cash and cash equivalents;

trade and other receivables (loan note);
finance lease obligations; and
accruals.
Due to the predominately cash-based nature of the Group’s operations, the only financial instruments that materially expose the Group to any of
the financial risks detailed in the notes below are debt financing and related interest rate swaps, and the disclosures that follow relate principally to
these items.
The Group uses derivative financial instruments in order to reduce its exposure to financial risk. The use of such financial instruments constitutes an
integral part of the Group’s funding strategy. The Group manages its derivative financial instrument credit risk by only undertaking transactions with
relationship banks, which have good credit ratings. Such transactions are governed by Board policies and procedures.
90

22 Financial instruments (continued)

iii) Cash flow and fair value interest rate risk
As the Group has no significant interest-bearing assets, asides from cash and cash equivalents and short-term deposits, the Group’s income and
operating cash inflows are substantially independent of changes in market interest rates.
The Group’s interest rate risk arises from long-term borrowings. Borrowings issued at variable rates expose the Group to cash flow interest rate risk.
Borrowings issued at fixed rates expose the Group to fair value interest rate risk.
The Group manages its cash flow interest rate risk by using floating-to-fixed interest rate swaps. Such interest rate swaps have the economic effect
of converting borrowings from floating rates to fixed rates. Generally, the Group raises long-term borrowings at floating rates and swaps them into
fixed rates that are lower than those available if the Group borrowed at fixed rates directly. Under the interest rate swaps, the Group agrees with other
parties to exchange, at specified intervals (primarily monthly), the difference between fixed contract rates and floating rate interest amounts
calculated by reference to the agreed notional amounts.
During the year ended 25 February 2010, if interest rates on UK denominated borrowings had been 0.5% higher, with all other variables held constant,
pre-tax profit for the year would have been £0.7m lower (2009: £0.8m lower) based on an unhedged position, as a result of a higher interest expense
on floating rate borrowings. Taking the hedges into account, pre-tax profit for the year would have been £0.5m lower (2009: £0.4m lower). This will
have a consequential effect on equity, excluding any change in the fair value of the derivatives as a result of the interest rate change.
b) Credit risk
Credit risk is managed on a Group basis. Credit risk arises from cash and cash equivalents, derivative financial instruments and deposits with banks and
financial institutions, as well as credit exposures to receivables principally recognised on sales of property assets and on income received from sub-lets.
The Group does not have a significant concentration of credit risk, and the majority of the Group’s revenues are cash-based.
A vendor loan note of £19.3m (plus accrued interest of £5.3m) with 3DE is receivable on the earliest of a subsequent sale of the business, refinancing
or January 2014. At the year end, this balance has been provided for in full as 3DE is now in administration and therefore, recoverability of the loan is
perceived to be a high credit risk.
The Group’s funding is provided by banks with an AAA credit rating.
c) Liquidity risk
Prudent liquidity risk management implies maintaining sufficient cash and marketable securities, the availability of funding through an adequate
amount of committed credit facilities and the ability to close out market positions.
Management monitor rolling forecasts of the Group’s liquidity reserve on the basis of expected cash flow. In addition, the Group’s liquidity
management policy involves monitoring balance sheet liquidity ratios against internal and external regulatory requirements and maintaining debt
financing plans. Liquidity risk is managed through an assessment of short, medium and long-term cash flow forecasts to ensure the adequacy of
committed debt facilities and monitoring compliance with banking covenants, which are formally assessed twice yearly.
The table below analyses the Group’s financial liabilities into relevant maturity groupings based on the remaining period at the balance sheet date to
the contractual maturity date. The amounts disclosed are the contractual undiscounted cash flows.
25 February 2010 26 February 2009

Less than Between Between Less than Between Between
1 year 1–2 years 2–5 years Total 1 year 1–2 years 2–5 years Total
£m £m £m £m £m £m £m £m
Borrowings 1.7 1.7 149.1 152.5 3.7 3.7 175.4 182.8

Derivative financial
instruments 4.6 4.6 4.6 13.8 4.4 4.4 4.4 13.2
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Financial instrument disclosures
a) Interest rate exposure of financial assets and liabilities
The interest rate exposure of the Group’s financial assets, being cash and cash equivalents, short-term deposits and the loan note receivable from the
related parties (including accrued interest), was as follows:
Fixed rate at year end

Fixed Floating Floating Interest Time
rate rate Total interest rate rate period
£m £m £m % % Years
25 February 2010 10.0 37.3 47.3 0.5 2.7 1.0

26 February 2009 22.7 27.9 50.6 — 8.0 1.8
Included within the floating rate financial assets at 25 February 2010, were cash and cash equivalents related to venues held for sale of £nil (2009: £nil).
The trade receivables and other debtors balances totalling £2.3m (2009: £3.4m) were non-interest bearing and therefore have been excluded.
After taking into account the various interest rate swaps entered into by the Group in the prior year, the interest rate profile of the Group’s financial
liabilities was:
Fixed rate weighted average

Fixed Floating Floating Interest Time
rate rate Total interest rate rate period
£m £m £m % % Years
25 February 2010 97.9 50.0 147.9 1.2 5.6 7.0

26 February 2009 97.9 80.0 177.9 2.3 5.6 8.0
The fixed rate debt included £90.0m (2009: £90.0m) in relation to the fixed rate hedged element of the bank loan. The floating rate debt includes
£50.0m (2009: £50.0m) in relation to the element of the bank loan, which is subject to an interest rate cap and floor derivative instrument (see
note d for more details on derivative financial instruments). The floating rate debt bears interest of LIBOR, reset every month, plus a margin
of up to 0.75%.
b) Maturity analysis of financial assets and liabilities

The maturity profile of the Group’s financial assets was as follows:

Short-term Loans and Loans and
Cash deposits receivables Total Cash receivables Total
£m £m £m £m £m £m £m
Within one year or on demand 37.3 10.0 2.3 49.6 27.9 3.4 31.3
Between two and five years — — — — — 22.7 22.7
Over five years — — — — — — —

37.3 10.0 2.3 49.6 27.9 26.1 54.0
Short-term deposits relate to monies placed on deposit, which mature in more than three months but less than two years. No such deposits were in
place in the prior year.
92


The maturity profile of the Group’s financial liabilities was as follows:
Bank Finance Bank Finance
and other lease and other lease
borrowings liabilities Total borrowings liabilities Total
£m £m £m £m £m £m
Between two and five years 140.0 0.1 140.1 170.0 0.1 170.1
Over five years — 7.8 7.8 — 7.8 7.8

140.0 7.9 147.9 170.0 7.9 177.9
Trade and other payables of £5.7m (2009: £6.1m) are payable within one year.
c) Fair values of financial assets and liabilities

Book value Fair value Book value Fair value
£m £m £m £m
Primary financial instruments held or issued to finance the Group’s operations

Cash and cash equivalents (i) 37.3 37.3 27.9 27.9
Monies on deposit (ii) 10.0 10.1 — —
Loan note receivable (iii) — — 22.7 22.7
Trade receivables and other debtors (iv) 2.3 2.3 3.4 3.4
Long-term borrowings (v) (140.0) (140.0) (170.0) (170.0)
Finance lease obligations (vi) (7.9) (6.1) (7.9) (6.1)
Derivative financial instruments held to manage the interest rate
and currency profile
Cash flow hedges (vii) (13.8) (13.8) (13.2) (13.2)
The fair value of other financial assets and liabilities included in notes 16, 19 and 24 approximate their carrying value.
i) Cash at bank, including deposits made for short durations (less than one month). Given the short maturity periods there is no significant
difference between the book value and fair value of these deposits.
ii) Short-term deposits relate to monies placed on deposit which mature in greater than three months but less than two years. Fair value of the
deposits at year end includes effective accrued interest of £0.1m.
iii) The loan note receivable of £24.6m (2009: £22.7m) includes accrued interest of £5.3m (2009: £3.4m) and has been fully provided against in the
year due to the counterparty having been placed into administration shortly after the year end, resulting in a net book value of £nil. The fair
value approximates to book value.
iv) The fair value of trade receivables and other debtors approximates to book value.
v) Drawings made under the Group’s floating rate facility. The fair value excludes the interest accrual reported within accruals and deferred
income of £nil (2009: £nil).
vi) Finance lease liabilities at fixed rate. Given the length of time to maturity of these liabilities and the length of time since inception of the lease,
the fair value of these liabilities at the balance sheet date is lower than current book value.
vii) The fair value of cash flow hedges has been determined with reference to market rates at the balance sheet date. At 25 February 2010, the book
value of these swaps equated to their fair value as these derivatives were stated at their fair value under IAS 39.
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Effective from 27 February 2009, the Group adopted the amendment to IFRS 7 for financial instruments that are measured in the Balance Sheet at fair
value. This requires disclosure of fair value measurements by level of the following fair value measurement hierarchy:
— quoted prices (unadjusted) in active markets for identical assets or liabilities (level 1);
— inputs other than quoted prices included in level 1 that are observable for the asset or liability, either directly (that is as prices) or indirectly
(that is derived from prices) (level 2); and
— inputs for the asset or liability that are not based on observable market data (that is unobservable inputs) (level 3).
All items disclosed above are considered to be level 2.
d) Derivative financial instruments

The Group has three cash flow hedges in place at the year end, hedging the majority of the interest rate risk of the Group’s borrowings. The notional
principal amounts of the outstanding interest rate swap contracts at 25 February 2010 were £90.0m for two fixed rate swaps and £50.0m for a cap
and floor swap. The fixed interest rates on the swaps were 5.54% (on the £40.0m swap) and 5.56% (on the £50.0m swap). The cap and floor was
triggered at the year end, due to the LIBOR rate being below the floor rate of 4.48%.
An additional swap was entered into in May 2009, which does not meet the definition of a hedge under IAS 39 and as such, has not been hedge
accounted for. The £0.1m (2009: £nil) movement on the fair value of this swap has been recorded through the income statement.
These swaps were fair valued at £13.8m liability at the year end (2009: £13.2m liability), determined using discounted cash flow valuation techniques.
The Group uses a variety of methods and makes assumptions that are based on market conditions existing at each balance sheet date.
The table below reconciles the movement in the fair value of the hedges during the year:
Fair value
£m
Brought forward at 27 February 2009 (13.2)

Decrease in the mark-to-market value (6.1)
Recycled through income statement 5.6

Carried forward at 25 February 2010 (13.7)
There was no ineffectiveness to be recorded from the cash flow hedges.
e) Financial instruments held for trading purposes

The Group does not trade in financial instruments.
94

23 Obligations under finance leases

The minimum lease payments under finance leases fell due as follows:
2010 2009
£m £m
Within one year 0.5 0.5

In the second to fifth years inclusive 1.9 1.9
After five years 27.2 27.7

29.6 30.1
Less future finance charges (21.7) (22.2)

Present value of lease obligations 7.9 7.9
Less amount due for settlement within one year — —

Amount due for settlement after more than one year 7.9 7.9
Split by:
Amount due for settlement within second to fifth years inclusive 0.1 0.1
Amount due for settlement after five years 7.8 7.8
All finance lease obligations represent liabilities for the building element of properties used in the Group’s business. The lease agreements include rent
review clauses at periodic intervals of a kind that are usual for property leases.
24 Provisions
Onerous Public liability Other
leases insurance provisions Total
£m £m £m £m

Charge for the year 4.0 0.5 0.9 5.4
Released during the year (0.8) (0.2) (1.7) (2.7)
Utilised during the year (1.3) (0.5) (3.2) (5.0)

At 25 February 2010 4.1 0.7 0.9 5.7

At 25 February 2010 classified as:
Held for sale 0.4 — 0.1 0.5
Continuing operations 3.7 0.7 0.9 5.2
At 26 February 2009 classified as:
Held for sale 1.3 — 4.5 5.8
Continuing operations 0.9 0.9 0.4 2.2
Provisions within continuing operations have been analysed between current and non-current as follows:
2010 2009
£m £m
Current 2.3 1.5

Non-current 2.9 0.7

5.2 2.2
Onerous lease provisions have been discounted using a discount rate of 4.4%, based on available Government Gilt rates, as an approximate to the
long-term risk free rate. No other provisions have been discounted as the effect of discounting would not be material.
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24 Provisions (continued)
Onerous leases
Provisions for onerous leases represent onerous commitments on operating leases for properties currently vacant or for closed venues, where
assignment of the lease or sub-let of the property is unlikely in the short-term.
Provision is made for rent and related property costs for the period Management estimate the property would not be sub-let, or until assignment of
the lease is probable and ranges up to five years.
Where the property is deemed likely to be assigned, provision is made for the best estimate of the reverse lease premium payable on the assignment,
if this represents the least cost to exit from the commitment. £0.8m has been released unutilised in the year due to a change in assumption of how a
particular venue would be exited.
The amount and timing of the cash outflows relating to onerous leases are subject to variations. In estimating the amount and timing of cash flows,
Management utilise the skills and experience of both internal and external property specialists and are satisfied that the resulting estimated provision
is appropriate.
Public liability insurance

Provision for public liability insurance is made for the estimated exposure of the Group to claims based upon experience of historical claims. This
provision is expected to be utilised within two years.
Other provisions
Other provisions represent £0.1m in relation to expected final costs to be incurred in respect of the disposal of five subsidiary companies to Cavendish
Bars Limited and £0.8m in relation to costs in respect of Eminence Limited, an associate of the Group, that went into liquidation during the year.
£0.4m of a brought forward provision for legal costs has been released unutilised in the year due to a change in expected outcomes. A further £1.3m
has been released in respect of the total provisions brought forward in relation to the disposal to Cavendish Bars Limited, due to the related companies
having been placed into liquidation or administration during the year and, therefore, certain specified costs will no longer become payable.
96

25 Deferred tax
£m

Credit recognised in income statement (note 5) (12.2)
Credit recognised in equity (note 5) (0.2)

The cumulative deferred taxation in equity is £3.9m (2009: £3.7m).
2010 2009
£m £m
Held for sale 0.1 0.1

Continuing operations 7.9 20.3

8.0 20.4
The analysis of the year end deferred tax position was as follows:
2010 2009
£m £m
On property, plant and equipment 10.6 22.3

Other temporary differences (2.6) (1.9)

8.0 20.4
Deferred taxation provided for in the financial statements at the year end represents provision at 28% (2009: 28%) on the temporary differences
between the accounting net book amount of property, plant and equipment and the tax base of those assets.
The deferred tax liability has been calculated using estimates based on the current manner of recovery of the assets’ value on property, plant and
equipment not eligible for capital allowances, i.e. recovery through continued use in the business unless the asset is held for sale. This method
assumes no tax relief will be available. Therefore, no tax base is available for inclusion within the calculation of the deferred tax liability, unless the
assets’ value is recovered through sale rather than continued use.
Of the £8.0m deferred taxation balance, £1.5m is expected to impact the income statement within one year.
The key assumptions in the calculation of deferred tax are set out below:
— Capital expenditure — the percentage of the Group’s capital expenditure that would qualify for tax relief, incurred by each venue, has been
estimated based on historical experience of the split between qualifying and non-qualifying expenditure;
— Impairments — the impairments to property, plant and equipment have been apportioned between assets qualifying for tax relief and those
that do not; and
— Depreciation — the rate of depreciation for assets that do not qualify for the initial recognition exemption has been estimated based on actual
data for the most recent accounting periods.
A review of the deferred tax liability is performed at each balance sheet date and adjustments made in the event of a change in any key assumptions.
At the balance sheet date, the Group has estimated unused capital gains tax losses of £101.0m (2009: £80.9m) available for offset against future
taxable profits from capital disposals and £21.3m estimated unused taxable losses available for offset against future taxable operating profits. No
deferred tax asset has been recognised in respect of these losses due to the unpredictability of future profit streams available to offset these losses.
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26 Share capital
2010 2009
Number £m £m
Authorised
Ordinary shares of 25 pence each (2009: £2.00 each) 513,957,217 128.5 190.0
(2009: 95,000,000)
Deferred shares of £1.75 each (2009: 60.2 pence) 60,948,969 106.7 45.2
(2009: 75,000,000)

235.2 235.2
Issued, called up and fully paid
(2009: 60,948,969)
Deferred shares of £1.75 each (2009: 60.2 pence each) 60,948,969 106.7 —
(2009: nil)

131.8 121.9
On 18 August 2009, under a Firm Placing and Placing and Open Offer, the Company converted its authorised deferred share capital of 75,000,000
shares of 60.2 pence each into 22,575,000 new Ordinary shares of £2.00 each.
At the same time, all 56,626,031 unissued Ordinary shares (including the new Ordinary shares) of £2.00 each, were converted into 453,008,248 new
Ordinary shares of 25 pence each.
At the same time, the 60,948,969 Ordinary shares of £2.00 each, were converted into 60,948,969 new Ordinary shares of 25 pence each and 60,948,969
Deferred shares of £1.75 each.
On the same day, an additional 39,473,685 of new Ordinary shares of 25 pence each were issued of which 19,157,362 were issued through the Firm
Placing and 20,316,323 through the Placing and Open Offer.
All of the new Ordinary shares were admitted to the London Stock Exchange for dealing on 19 August 2009.
Following the year end, the Deferred shares have been redeemed and cancelled. This took place on 30 April 2010.
Potential issues of ordinary shares at the year end were as follows:
1996 Executive Share Option Scheme

Number of Exercise
ordinary shares price*
Date of grant under option* £ Exercise period
11/07/00 543,689 6.57 11/07/03 to 10/07/10

21/08/00 1,439 6.30 21/08/03 to 20/08/10
23/02/01 38,433 7.48 23/02/04 to 22/02/11
04/07/01 28,419 8.09 04/07/04 to 03/07/11
09/07/01 3,442 8.22 09/07/04 to 08/07/11
09/12/02 122,749 3.85 09/12/05 to 08/12/12
22/05/03 214,261 3.73 22/05/06 to 21/05/13
14/07/04 27,572 3.86 14/07/07 to 13/07/14
25/07/05 119,503 4.82 25/07/08 to 24/07/15
25/07/06 174,871 5.23 25/07/09 to 24/07/16
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26 Share capital (continued)

Luminar Group Holdings 2007 Performance Share Plan
Number of Exercise
09/11/07 298,907 — 01/08/10 to 31/07/11

22/05/08 493,027 — 22/05/11 to 21/05/12
10/06/09 875,492 — 10/06/12 to 09/06/15
1999 Company Share Option Plan

Number of Exercise
21/08/00 2,547 6.30 21/08/03 to 20/08/10

04/07/01 3,706 8.09 04/07/04 to 03/07/11
09/07/01 2,395 8.22 09/07/04 to 08/07/11
25/07/03 18,680 4.15 25/07/06 to 24/07/13
25/07/05 30,981 4.82 25/07/08 to 24/07/15
25/07/06 20,590 5.23 25/07/09 to 24/07/16
* The numbers of ordinary shares under option, and their related exercise prices, have been amended to take account of the changes made to share capital during the year.
27 Share-based payments
The Group has followed the transitional arrangements within IFRS 2, Share-based payment and has adopted the exemption from full retrospective
application of all share-based payment awards and has only applied the measurement requirements of IFRS 2 to awards made after 7 November 2002.
However, the following disclosures include all share-based payment awards, therefore including those equity-settled awards granted prior to
7 November 2002.
The Group operates the following share-based payment plans:
a) Deferred Bonus Plan

This was approved by Shareholders in 2004 and was operated in 2004 and 2005. Under the terms of the Plan, 50% of the bonus entitlement of
Executive Directors is deferred for three years into a deferred bonus award which is notionally invested in the Company’s shares. Any dividends
accruing on the notional shares are accrued to the benefit of the Executive Directors. Matching shares can be awarded (up to two matching shares
for each notional share), based on the Shareholder return of the Group relative to the FTSE 250 Index over the relevant three-year period.
All remaining options awarded under this scheme were exercised in the prior year.
b) 1996 Executive Share Option Scheme & 1999 Company Share Option Plan
Options granted under the 1996 Scheme (which are unapproved options) and the 1999 Plan (which are HM Revenue & Customs approved options)
are exercisable between three and ten years from the grant date, subject to the employee remaining in the service of the Group. Options were
originally granted subject to performance conditions requiring EPS growth over a three-year period. Outstanding options were rolled over into
equivalent options over shares in Luminar Group Holdings plc in connection with the Capital Reorganisation (“Reorganisation”) in 2007. Following
the technical change of control of Luminar plc in connection with the Reorganisation, the Rules of the 1996 Scheme prescribed that unapproved
options became immediately exercisable, with performance conditions falling away, resulting in an exceptional charge during that year. Therefore, the
exercise of the rolled over unapproved options is not subject to any performance conditions. Similarly, rolled over approved options are not subject to
performance conditions, as prescribed by the rules of the 1999 Plan. This is a common provision in rules of this vintage. During the year, 462 options
awarded under this scheme in July 1999 and a further 1,000 awarded in August 1999 lapsed.
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27 Share-based payments (continued)

c) Northern Leisure 1998 Executive Share Option Scheme (‘Rolled over’ options)
Options granted under the Northern Leisure scheme were granted to holders of existing super options of Northern Leisure plc, who elected to
release those in exchange for an equivalent option over Luminar plc shares, in connection with the acquisition of Northern Leisure plc In turn, these
new options were rolled over into options over shares in Luminar Group Holdings plc in connection with the Reorganisation.
All brought forward outstanding options lapsed during the prior year due to the passing of ten years from the grant date of the original super options
(June 1998). All options were granted prior to 7 November 2002 and accordingly were excluded from the scope of IFRS 2.
d) Warrant scheme
On 22 February 1999, the Shareholders approved the establishment of a discretionary Trust to hold warrants as part of incentive arrangements, under
which they are subsequently allocated to employees. Each warrant carried the right to subscribe for one Ordinary share at the price of £6.671/2 per
share. Performance criteria attached to the warrant scheme were met in full in February 2002. The warrants may be exercised in the period of 28 days
following the publication of the Annual Report of each financial year, up to the year ending on or around 1 March 2009.
Following this date passing, any outstanding share options awarded under this scheme have all now lapsed.
e) Luminar Group Holdings 2007 Performance Share Plan

This was approved by shareholders at the 2007 AGM. Under the terms of the Performance Share Plan, Executives can be awarded conditional awards
of free shares, which are capable of vesting subject to performance and continued service over a three year period. The first grants under the plan
were made in November 2007 and will vest on 1 August 2010. Additional grants were made under the plan in May 2008, which will vest on 22 May
2011, and in June 2009, which will vest on 10 June 2012.
The awards granted to Executive Directors and other senior Executives under the plan are subject to performance conditions relating to Total
Shareholder Return (50% of the award) and strategic milestone targets (50% of the award). See pages 46 and 47 of the Remuneration Report for
further details of these targets. The awards granted to other employees are subject to a sliding scale of operating profit targets based on Group and/or
venue/area performance.
In the event of a change of control, awards will vest early subject to performance and time prorating (although the Remuneration Committee has
the discretion not to apply time prorating if it considers it inappropriate to do so).
Reconciliations of the number and weighted average exercise price by option scheme are presented below (including grants of options prior to
7 November 2002):
Deferred Performance 1996 & 1999 Northern
Number of shares bonus plan share plan Scheme Warrants Leisure 1998
At 28 February 2008 31,751 345,720 1,566,958 4,066,322 23,000

Granted 1,625 567,779 — — —
Forfeited — (148,406) (118,149) — —
Lapsed — — (171,500) — (23,000)
Exercised (33,376) — — — —

At 26 February 2009 — 765,093 1,277,309 4,066,322 —

Adjust for share issue* — 66,777 111,575 355,309 —
Granted — 901,403 — — —
Forfeited — (65,847) (34,018) — —
Lapsed — — (1,589) (4,421,631) —
Exercised — — — — —

At 25 February 2010 — 1,667,426 1,353,277 — —

Exercisable at end of the year
— 25 February 2010 — — 1,353,277 — —
— 26 February 2009 — — 1,097,292 4,066,322 —
* The number of ordinary shares under option and their related exercise prices have been amended to take account of the changes made to share capital during the year (see note 26,
‘Share Capital’).
100


Weighted average Deferred Performance 1996 & 1999 Northern
exercise price (£) bonus plan share plan scheme Warrants Leisure 1998
At 28 February 2008 5.19 — 6.17 6.68 8.74

Granted 5.22 — — — —
Forfeited — — (7.4) — —
Lapsed — — (4.77) — (8.74)
Exercised (5.19) — — — —

At 26 February 2009 — — 5.94 6.68 —

Granted — — — — —
Forfeited — — (5.31) — —
Lapsed — — (0.55) (6.68) —

At 25 February 2010 — — 5.94 — —

— 25 February 2010 — — 5.94 — —
— 26 February 2009 — — 5.97 6.68 —

exercise price (£) bonus plan share plan scheme Warrants Leisure 1998
For share options exercised during the year:

Average exercise price for options exercised
— year to 25 February 2010 — — — — —
— year to 26 February 2009 5.19 — — — —
For share options outstanding at the end of the year:

Range of exercise prices
— year to 25 February 2010 — — 4.06–9.38 — —
— year to 26 February 2009 — — 4.06–9.38 6.675 —
Weighted average remaining contractual life (in years)

— year to 25 February 2010 — 1.4 2.6 — —
— year to 26 February 2009 — 2.4 3.7 0.3 —
The fair value for options granted during the year has been determined using a stochastic model. The assumptions and inputs to the model for
options granted during the year were as follows:
Performance
Share Plan
Weighted average fair value of options at grant date £1.412

Weighted average exercise price £0
Expected volatility 56.9%
Option life 3 years
Risk-free interest rate 2.32%
Expected dividend growth 0%
The expected volatility is estimated using the historical volatility of the Group’s shares over a period equivalent to the expected life of the option.
The Group recognised a total charge within administrative expenses of £0.5m (2009: £0.2m charge) and exceptional items of £nil (2009: £0.1m),
related to share-based payment transactions, all of which were accounted for as equity-settled share-based payment arrangements with a
corresponding credit (2009: credit) direct to equity reserves. The cumulative credit to equity reserves in respect of share-based payments totalled
£1.7m (2009: £1.2m).
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28 Reserves
The reconciliation of movements in reserves is presented, as a Consolidated Statement of Changes in Shareholders’ Equity, on page 60. Within this
reconciliation the Group has presented the following reserves:
the share premium, which arose on the issue of new share capital during the year, net of £1.2m related issue costs;
the capital redemption reserve, which arose as a result of the share buy-backs carried out during prior years; and
the equity reserve, which arose on recognition of share-based payment expenses following the requirements of IFRS 2, Share-based payment.
The share premium, capital redemption and equity reserves are all non-distributable reserves.
As a result of the restructure that took place during the prior year, the capital reserve and merger reserve became distributable and were therefore
transferred into the retained earnings reserve.
Of the closing retained earnings reserve of £(21.6)m (2009: £102.1m), £1.8m (2009: £1.7m) related to treasury share adjustments and £13.7m (2009:
£13.2m) related to the change in fair value of the cash flow hedges.
29 Cash flow from operating activities

a) Reconciliation of net cash inflow from operating activities
2010 2009
£m £m
(Loss)/profit before taxation — continuing operations (110.2) 10.5

Loss before taxation — discontinued operations (27.2) (29.6)

Loss before taxation (137.4) (19.1)
Depreciation and amortisation 22.7 22.7
Amortisation of lease premiums 0.1 0.2
Amortisation of issue costs 0.2 0.2
Net impairment of property, plant and equipment 64.0 8.9
Impairment of goodwill 41.1 0.7
Impairment of other non-current assets 1.9 —
Impairment of investment in associate 3.6 24.1
Provision against receivables due from associate 24.4 —
Movement in accrued transaction costs — (2.5)
Profit on sale of property, plant and equipment (0.5) (0.7)
Loss on sale of motor vehicles — 0.1
Loss on disposal of intangible assets — 0.1
Non-cash charges for share-based payments 0.5 0.3
Net finance costs 7.2 8.3

27.8 43.3
Decrease in inventories 0.6 0.2
Decrease in receivables 1.1 0.5
(Decrease)/increase in trade and other payables (4.0) 3.2
Decrease in provisions (2.2) (5.1)

Net cash inflow from operations 23.3 42.1
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29 Cash flow from operating activities (continued)

b) Cash flows from continuing operations
To assist in the understanding of cash flows relating to the ongoing business of the Group, the following tables outline the cash flows relating to
discontinued operations and exceptional items to be excluded in order to present operating cash flows that relate to the Group’s continuing business:
2010 2009
£m £m
Cash flows from operating activities 17.3 32.0

Add: net cash flows from operating activities — discontinued operations (including exceptional cash items) 5.3 11.0

Cash flows from operating activities — continuing operations 22.6 43.0
Add: net exceptional cash flows from operating activities — continuing operations 2.9 1.2

Pre-exceptional cash flows from operating activities — continuing operations 25.5 44.2

2010 2009
£m £m
Net cash inflow from operations 23.3 42.1

Add: net cash flows from operating activities — discontinued operations (including exceptional cash items) 5.3 11.0

Net cash inflow from operations — continuing operations 28.6 53.1
Add: net exceptional cash flows from operations — continuing operations 2.9 1.2

Net pre-exceptional cash inflow from operations — continuing operations 31.5 54.3
30 Capital risk management

The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going concern, in order to provide returns for
Shareholders and benefits for the other stakeholders and to maintain an optimal capital structure to reduce the cost of capital.
In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to Shareholders, return capital to
Shareholders, issue new shares or sell assets to reduce debt.
Consistent with others in the industry, the Group monitors capital on the basis of the gearing ratio. This ratio is calculated as net debt divided by total
capital. Net debt is calculated as total borrowings, including finance leases, less cash and cash equivalents. Total capital is calculated as Shareholders’
equity, as shown in the Consolidated Balance Sheet.
The net debt position is shown on page 59. The movement in net debt in the year is analysed as follows:
26 February Non-cash 25 February
2009 Cash flow flows 2010
£m £m £m £m
Cash and cash equivalents 27.9 9.4 — 37.3

Monies on deposit — 10.0 — 10.0
Loans due in more than 1 year (170.0) 30.0 — (140.0)

(142.1) 49.4 — (92.7)
Finance leases (7.9) — — (7.9)

Net debt (150.0) 49.4 — (100.6)
With total capital of £179.8m, the gearing ratio was 56% at 25 February 2010 (26 February 2009: 56%), in line with the prior year.
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31 Operating lease commitments — minimum lease payments

The Group had total commitments under non-cancellable operating leases in relation to land and buildings as follows:
2010 2009
£m £m
Expiring in less than one year 18.0 20.2

Expiring between one and five years 61.8 74.0
Expiring in over five years 198.1 221.2

277.9 315.4
Less total of future minimum sub-lease payments expected to be received (6.5) (39.1)

Total commitment 271.4 276.3

Sub-lease payments recognised as an expense in the year 1.2 1.2
Sub-lease income recognised during the year (0.7) (0.8)

Net sub-lease payment 0.5 0.4
The Group leases various properties relating to trading venues or office and warehouse accommodation. These leases have various terms, escalation
values and renewal rights.
At the prior year end, the operating leases that had been sold to 3DE, had not all been assigned yet due to the time taken to finalise matters with
the landlords. Therefore, the commitment above included those leases yet to be assigned as at 26 February 2009, for which there was an equal and
offsetting expected rental income to be received from 3DE. Consequently, the commitment for the leases sold to 3DE did not affect the net
operating lease rental charge shown in the Consolidated Income Statement for the period ended 26 February 2009.
During the year ended 25 February 2010, all such leases have been assigned and therefore the disclosures made above in relation to this financial year
do not include any amounts for the commitment and expected future rental income in relation to these leases.
During the prior year, the Group entered an asset financing arrangement whereby £10.0m was raised through the sale of certain equipment, which
will be leased back over a period of 42 months with the option to be repurchased at that time. The arrangement is based on standard terms for
similar transactions.
32 Pensions
The Group operates defined contribution schemes for the benefit of Directors and employees. The schemes are administered by trustees and the
assets are held in a fund independent from those of the Group. The cost to the Group of pension contributions is included in note 4.
33 Contingent assets and contingent liabilities

The Group is currently pursuing a case against HM Revenue & Customs in respect of VAT of £6.1m (2009: £5.1m) that we believe has been overpaid.
This contingent asset has not been recognised.
On 10 July 2009, the Group provided a guarantee for £2m on behalf of 3DE in relation to a bank loan, which was secured over the assets of 3DE.
On 26 February 2010, 3DE was placed into administration. Following this, the bank loan has been repaid in full and as such, the Group do not expect
this guarantee to be called upon.
34 Capital commitments
The Group had capital commitments relating to property, plant and equipment of £0.3m at 25 February 2010 (2009: £0.2m).
104

35 Related party transactions

The Group incurred costs of £6.3m (2009: £10.7m) from Eminence Leisure Limited, which is an associate of the Group, in respect of entertainment
acts and bookings. In relation to these transactions, a debtor balance of £0.8m (2009: £0.3m liability) remained outstanding at the year end, which has
been fully provided against due to Eminence Leisure Limited having gone into liquidation during the year. No income (2009: £nil) was received from
Eminence Leisure Limited during the year.
On 19 January 2007, the Group sold certain trade and assets of its units to 3DE.
Post-completion on 19 January 2007 a transitional services agreement (“TSA”) was in place between the Group and 3DE (an associate of the Group) for
the provision of certain services. £0.8m (2009: £1.3m) of income has been credited within administrative expenses in relation to the provision of these
services. At the year end, £24.6m (2009: £22.7m) was owed to the Group in relation to the loan note and accrued interest, and £1.0m (2009: £0.2m) was
owed in respect of outstanding TSA invoiced charges, capital amounts and other recharges. All balances in relation to 3DE have been fully provided
against as at 25 February 2010 due to the company having been placed into administration on 26 February 2010.
During the year, the Group recognised contributions of £nil (2009: £0.1m) from Lucien Barriere for costs incurred relating to the Waterimage Limted
joint venture (see note 14). Of the amount recognised, £nil (2009: £nil) remained outstanding at the year end.
36 Post-Balance Sheet Events

On 26 February 2010, 3DE was placed into administration. All outstanding receivables have been fully provided against and the investment carrying
value has been fully impaired as at 25 February 2010.
On 30 April 2010, the Deferred Shares were redeemed and cancelled, as disclosed in note 26, ‘Share Capital’.
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Company
108 Principal Accounting Policies for the Company Financial Statements
106
Independent Auditors’ Report to the

Members Of Luminar Group Holdings plc
We have audited the parent Company financial statements of Luminar Group Holdings plc for the year ended 25 February 2010, which comprise the
Company Balance Sheet, the Principal Accounting Policies for the Company Financial Statements and the Notes to the Company Financial Statements. The
financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards (United Kingdom
Generally Accepted Accounting Practice).
Respective responsibilities of Directors and auditors

As explained more fully in the Directors’ Responsibilities Statement, the Directors are responsible for the preparation of the Annual Report, the Directors’
Remuneration Report and parent Company financial statements and for being satisfied that they give a true and fair view. Our responsibility is to audit the
parent Company financial statements in accordance with applicable law and International Standards on Auditing (UK and Ireland). Those standards require
us to comply with the Auditing Practices Board’s Ethical Standards for Auditors.
This Report, including the opinions, has been prepared for and only for the Company’s members as a body in accordance with Chapter 3 of Part 16 of the
Companies Act 2006 and for no other purpose. We do not, in giving these opinions, accept or assume responsibility for any other purpose or to any other
person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior consent in writing.
Scope of the audit of the financial statements

An audit involves obtaining evidence about the amounts and disclosures in the financial statements sufficient to give reasonable assurance that the
financial statements are free from material misstatement, whether caused by fraud or error. This includes an assessment of: whether the accounting policies
are appropriate to the parent Company’s circumstances and have been consistently applied and adequately disclosed; the reasonableness of significant
accounting estimates made by the Directors; and the overall presentation of the financial statements.
Opinion on financial statements

In our opinion the parent Company financial statements:
give a true and fair view of the state of the Company’s affairs as at 25 February 2010;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.
Opinion on other matters prescribed by the Companies Act 2006

In our opinion:
the part of the Directors’ Remuneration Report to be audited has been properly prepared in accordance with the Companies Act 2006; and
the information given in the Directors’ Report for the financial year for which the parent Company financial statements are prepared is consistent with the
parent Company financial statements.
Matters on which we are required to report by exception

We have nothing to report in respect of the following matters where 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 and the part of the Directors’ Remuneration Report to be audited 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.
Other matter
We have reported separately on the Consolidated financial statements of Luminar Group Holdings plc for the year ended 25 February 2010.
Owen Mackney (Senior Statutory Auditor)

for and on behalf of PricewaterhouseCoopers LLP
Chartered Accountants and Statutory Auditors
St Albans
12 May 2010
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Financial Statements Consolidated Financial Statements
Company Balance Sheet

at 25 February 2010
2010 2009
Note £m £m
Fixed assets
Investments 4 118.2 250.7
Current assets
Debtors 5 132.3 100.2
Cash and cash equivalents 6 — 0.1

132.3 100.3
Creditors: amounts falling due within one year 7 (16.7) (18.6)

Net current assets 115.6 81.7

Net assets 232.9 329.0

Capital and reserves
Share capital 10 131.8 121.9
Share premium 12 25.8 —
Equity reserve 12 4.8 4.3
Capital redemption reserve 12 42.1 42.1
Profit and loss reserve 12 28.4 160.7

Shareholders’ funds 13 232.9 329.0
The financial statements were approved by the Board of Directors on 12 May 2010.
Robert McDonald
Finance Director
108
Principal Accounting Policies for the Company Financial Statements
Basis of preparation
These financial statements present financial information for Luminar Group Holdings plc as a separate entity and are prepared in accordance with the
historical cost convention, the Companies Act 2006 and UK Accounting Standards (UK Generally Accepted Accounting Practice). The Company’s
Consolidated Financial Statements, prepared in accordance with International Financial Reporting Standards as adopted by the European Union, are
separately presented. The principal accounting policies adopted in these Company financial statements are set out below and, unless otherwise indicated,
have been consistently applied for the periods presented.
As a result of the deferred shares being redeemed and cancelled in July 2008, issued share capital and capital redemption reserve comparatives have been
represented in this financial information for the year ended 25 February 2010.
In accordance with FRS 18, Accounting Principles, the Directors have reviewed the accounting policies of the Company as set out below and consider them
to be appropriate.
Cash flow statement and related party transactions

The Company has taken advantage of the exemption from preparing a cash flow statement under FRS 1 (Revised 1996), Cash flow statements. The
Company is also exempt under the terms of FRS 8, Related party disclosures from disclosing related party transactions with entities that are part of the
Luminar Group Holdings plc Group.
Impact of new accounting standards

The Company has applied all applicable accounting standards in issue, which are required to be adopted for this year end, none of which are deemed
applicable to the Company.
Turnover
Turnover is the total amount receivable by the Company for management and other services, provided to other Group companies, excluding VAT and is
recognised on performance of these services.
Investments
Investments in subsidiary undertakings and associates are stated at cost less amounts written off for impairment. Amounts advanced to subsidiary
undertakings with no intention of being repaid in the foreseeable future are classified as investments.
Basis of impairment
On an annual basis, the Company performs a review of its investments to determine whether there have been any impairment trigger events. If such a
trigger event is considered to be a permanent diminution in value, rather than a temporary diminution in value, then the recoverable amount of the
asset, or where appropriate group of assets, in CGUs that comprise the investment, is estimated and compared to the carrying amount of the asset. The
recoverable amount is the higher of the VIU to the Company of the asset and the net realisable value from disposal of the asset. VIU is estimated by
calculating the net present value of the estimated future cash flows relating to the CGUs that comprise the investment after applying a discount factor. Net
realisable value is estimated by applying the knowledge and experience of management together with external market indicators. If the recoverable amount
is below the carrying value of the asset then the carrying value of the asset is reduced to its recoverable amount and the resulting charge is taken to the
profit and loss account.
Retirement benefit costs

Payments made to defined contribution retirement benefit schemes are charged as an expense when they fall due. The Company has no other retirement
benefit schemes.
Financial instruments
The Company has applied FRS 25, Financial instruments: Disclosure and presentation and FRS 26, Financial instruments: Measurement. The Company has
taken advantage of the exemption in paragraph 2d of FRS 29, Financial Instruments: Disclosure, and not presented information required by that standard
as the Group’s consolidated financial statements, in which the Company is included, provide equivalent disclosures for the Group under IFRS 7, Financial
Instruments: Disclosures.
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Financial assets and liabilities — measurement basis

Financial assets and liabilities are recognised on the date on which the Company becomes a party to the contractual provisions of the instrument giving
rise to the asset or liability. Financial assets and liabilities are initially recognised at fair value plus transaction costs. Any impairment of a financial asset is
charged to the profit and loss account when incurred. Financial assets are derecognised when the Company’s rights to cash inflows from the asset expire.
Financial liabilities are derecognised when the contractual obligations are discharged, cancelled or expire.
Financial assets are classified according to the purpose for which the asset was acquired. The Company’s financial assets are classified as:
— debtors — these are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They arise when the
Company provides goods or services directly to a debtor, or advances money, with no intention of trading the loan or receivable. Subsequent to initial
recognition loans and receivables are included in the balance sheet at amortised cost using the effective interest method less any amounts written off to
reflect impairment, with changes in carrying amount recognised in the profit and loss account.
The Company’s financial liabilities are classified as either ‘Creditors: amounts falling due within one year’ or ‘Creditors: amounts falling due after more than
one year’. These are non-derivative financial liabilities with fixed or determinable payments that are not quoted in an active market. They arise when the
Company receives goods or services directly from a creditor or supplier, or borrows money, with no intention of trading the liability. This category includes:
— trade creditors — these are typically non-interest bearing and following initial recognition are included in the balance sheet at amortised cost; and
— bank loans — these are initially recorded at fair value based on proceeds received, net of issue costs. Finance charges are accounted for on an accruals
basis and charged to the profit and loss account using the effective interest rate method.
Financial instruments — other disclosures

The Company’s debt financing and other activities expose it to a variety of financial risks that include the effects of changes in the following:
Interest rate risk

The Company has intercompany balances with some of its subsidiaries. Some of the outstanding balances are interest bearing loans, which bear arm’s
length interest at 0.75% above LIBOR;
Currency risk
The Company operates within the UK and substantially all transactions are denominated in sterling, therefore, the Company does not suffer from a
significant concentration of currency risk;
Credit risk
The Company does not have a significant concentration of credit risk. All receivables arise from transactions in the ordinary course of business with trading
subsidiaries;
Liquidity risk
Liquidity risk is managed through an assessment of short, medium and long-term cash flow forecasts to ensure the adequacy of committed debt facilities;
and
Price risk
The Company is not exposed to equity security price risk or commodity price risk.
Share-based payments
The Company has applied the requirements of FRS 20, Share-based payment. In accordance with the transitional provisions, FRS 20 has been applied to all
grants of equity instruments after 7 November 2002 that were unvested as of 1 January 2005.
Where equity instruments are granted to employees of subsidiary undertakings for the services provided by the employees to those companies, the fair
value at the grant date of the equity instrument represents an additional investment in the subsidiary undertaking by the parent.
The Company issues some equity instruments where the counter-party has a choice of either cash or equity settlement and some equity instruments
where the settlement can only be in equity.
Equity-settled share-based payments are measured at fair value at the date of grant. The fair value determined at grant date is expensed on a straight-line
basis over the vesting period, based on the Company’s estimate of the shares that will actually vest. Fair value is measured by means of a stochastic model.
A liability equal to the portion of the goods or services received is recognised at the current fair value at each balance sheet date for cash settled share-
based payments.
Shares held in ESOP trusts are presented as a deduction from equity.

110
Principal Accounting Policies for the Company Financial Statements (continued)
Issue costs
Costs directly related with establishing loan finance are offset against the value of the loan. Such costs are amortised over the period of the loan with the
resulting charge being recognised in interest expense.
Taxation
UK corporation tax is provided at amounts expected to be paid (or recovered) using the tax rates and laws that have been enacted or substantially
enacted by the balance sheet date.
Deferred taxation is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date, where transactions or
events that result in an obligation to pay more tax in the future, or a right to pay less tax in the future, have occurred at the balance sheet date. Timing
differences are differences between the Company’s taxable profits and its results as stated in the financial statements, that arise from the inclusion of gains
and losses in tax assessments in periods different from those in which they are recognised in the financial statements.
A net deferred tax asset is regarded as recoverable and, therefore, recognised only when, on the basis of all available evidence, it can be regarded as more
likely than not that there will be suitable taxable profits from which the future reversal of the underlying timing differences can be deducted.
Deferred tax is measured at the average tax rates and laws that are expected to apply in the periods in which the timing differences are expected to reverse,
based on tax rates and laws that have been enacted or substantively enacted by the balance sheet date. Deferred tax assets and liabilities recognised have
not been discounted.
Equity dividends
Final dividends are recognised in the Company’s financial statements in the period in which the dividends are approved by Shareholders. Interim dividends
are recognised in the period they are paid.
Dividend income
Dividend income from investments is recognised when the Shareholders’ rights to receive payment have been established.
PROVISIONS
Provisions for onerous lease commitments, public liability insurance claims and other provisions are recognised when: the Company has a present legal or
constructive obligation as a result of past events; it is more likely than not that an outflow of economic benefits will be required to settle the obligation; and
the amount can be measured reliably.
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Notes to the Company Financial Statements
1 Loss for the financial year

The Company has taken advantage of Section 408 of the Companies Act 2006 and has not included its own ‘Profit and Loss Account’ or ‘Statement
of Total Recognised Gains and Losses’ in these financial statements. The Company’s loss after tax for the year ended 25 February 2010 under UK GAAP
was £132.3m (2009: £0.2m).
Audit fees for the year were £0.1m (2009: £0.1m), with additional fees of £0.3m (2009: £0.1m) relating to taxation, other assurance and non-audit
services. A breakdown of these fees is shown below:
Year ended Period ended
2010 2009
£m £m
Auditors’ remuneration:
— audit of the financial statements pursuant to legislation 0.1 0.1
— other services relating to taxation 0.2 0.1
— other services provided pursuant to legislation 0.1 —

0.4 0.2
2 Directors and employees

Employee costs charged during the year were as follows:
2010 2009
£m £m
Wages and salaries 1.0 1.2

Social security costs 0.1 0.1
Share-based payment 0.3 0.2
Pension costs 0.1 0.2

1.5 1.7
During the year, the Company had six Directors (2009: six), including Non-Executive Directors, providing services to the Company. There were no
other employees.
Remuneration in respect of Directors (including Non-Executive Directors) of Luminar Group Holdings plc was as follows:
2010 2009
£000 £000

Company contributions to money purchase pension schemes 92 159

1,165 1,359
Aggregate emoluments disclosed above include amounts paid by other Group companies. During the period, two Directors (2009: two) participated
in defined contribution pension schemes.
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Notes to the Company Financial Statements (continued)
2 Directors and employees (continued)

The amounts set out above include remuneration of the highest paid Director as follows:
2010 2009
£000 £000
Aggregate emoluments 501 578

Company contributions to money purchase pension schemes 86 116

587 694
More detailed audited information concerning remuneration of Directors is set out in the Remuneration Report on pages 40 to 48.
3 Dividends
2010 2009
£m £m
Ordinary shares — final dividend paid for 2008: 13.95 pence per share — 8.5
Ordinary shares — interim dividend paid for 2009: 5.37 pence per share — 3.3

— 11.8
4 Investments
Shares in Employee
subsidiary share-based
undertakings payments Total
£m £m £m
As at 27 February 2009 250.0 0.7 250.7

Additions during the period — 0.1 0.1
Impairment (132.6) — (132.6)

At 25 February 2010 117.4 0.8 118.2
The carrying value of investments has been subjected to an impairment review as at 25 February 2010 on a VIU basis. The VIU calculations
considered forecast future cash flows, discounted at a post-tax weighted average cost of capital of 8.9%, combined with a terminal value at year 5,
applying a 2.2% long-term growth.
Subsidiary undertakings
The Company’s direct principal subsidiary undertakings, which are wholly owned, are listed below together with details of their businesses:
Class of Proportion Nature of

share capital held business
Luminar Finance Limited Ordinary 100% Financing Company

Luminar Holdings Limited Ordinary 100% Holding Company
These subsidiaries are registered in England and Wales. Other principal subsidiaries, which the Company indirectly owns, are included in note 14 of
the Consolidated Financial Statements.
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5 Debtors
2010 2009
£m £m
Amounts owed by Group undertakings 131.4 100.0

Other debtors 0.9 0.2

132.3 100.2
All amounts owed by Group undertakings are repayable on demand and are not past due or impaired.
6 Cash and cash equivalents

2010 2009
£m £m
Cash at bank and in hand — 0.1

— 0.1
7 Creditors: amounts falling due within one year

2010 2009
£m £m
Amounts owed to Group undertakings 13.1 14.2

Trade creditors — 0.1
Social security and other taxes 0.3 1.2
Corporation tax 2.1 2.1
Accruals and deferred income 1.2 1.0

16.7 18.6
8 Provisions
£m
As at 27 February 2009 3.4

Charge for the year 0.9
Released during the year (0.2)
Utilised during the year (3.2)

On 16 April 2008, the Group agreed to sell five individual companies to Cavendish Bars Limited. The disposal companies are responsible for all of the
leases of the venues being sold and are contingently liable as guarantors for a number of other non-core venues, including all of the leases relating to
venues that were sold in previous periods.
As part of the transaction, the Company entered into indemnities capped at £4.2m in favour of Cavendish Bars Limited, in relation to the guarantees,
and made provision for other related costs, which were expected to be incurred. At the year end, £0.1m (2009: £3.4m) of these provisions remain in
place in relation to expected legal and similar costs.
During the year ended 25 February 2010, an additional provision of £0.8m (2009: £nil) has been made for amounts owed by Eminence Leisure Limited,
an associate of the Company, due to the company having gone into liquidation.
114
9 Financial Instruments
The Group uses derivative financial instruments in order to reduce its exposure to financial risk. The Group’s bank borrowings and financial
instruments are transacted between a third party bank and a subsidiary of the Group.
As all the Company’s operations are transacted in the reporting currency, there is no currency exposure.
Short-term debtors and creditors have been excluded from all the following disclosures as their fair value at the year end approximates their
carrying value.
Interest rate risk

The Company has intercompany balances with some of its subsidiaries. Some of the outstanding balances are interest-bearing loans, which bear arm’s
length interest at 0.75% above LIBOR and are repayable on demand.
a) Interest rate exposure of financial assets and liabilities

The interest rate exposure of the Company’s financial assets, being amounts owed by Group undertakings, was as follows:
Floating rate
Fixed Floating weighted
rate rate Total average
£m £m £m %
25 February 2010 — 131.4 131.4 1.00

26 February 2009 — 100.0 100.0 2.64
The floating rate debt includes loans of £37.2m (2009: £6.1m), which are interest-free and are included in the weighted average interest rate
calculations.
Other debtors are excluded from the analysis since they are interest-free.
There are no financial liabilities subject to interest (2009: £nil).
b) Fair values of financial assets and liabilities

The book values of the financial assets and liabilities disclosed above approximate their fair values.
The fair value of other financial assets and liabilities included in notes 5, 7 and 8 approximate their carrying value.
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10 Share capital
2010 2009
Number £m £m
Authorised
(2009: 95,000,000)
Deferred shares of £1.75 each (2009: 60.2 pence) 60,948,969 106.7 45.2
(2009: 75,000,000)

235.2 235.2
Issued, called up and fully paid
(2009: 60,948,969)
Deferred shares of £1.75 each (2009: 60.2 pence each) 60,948,969 106.7 —
(2009: nil)

131.8 121.9
On 18 August 2009, under a Firm Placing and Placing and Open Offer, the Company converted its authorised deferred share capital of 75,000,000
shares of 60.2 pence each into 22,575,000 new Ordinary shares of £2.00 each.
At the same time, all 56,626,031 unissued Ordinary shares (including the new Ordinary shares) of £2.00 each, were converted into 453,008,248 new
Ordinary shares of 25 pence each.
At the same time, the 60,948,969 Ordinary shares of £2.00 each, were converted into 60,948,969 new Ordinary shares of 25 pence each and 60,948,969
Deferred shares of £1.75 each.
On the same day, an additional 39,473,685 of new Ordinary shares of 25 pence each were issued of which 19,157,362 were issued through the Firm
Placing and 20,316,323 through the Placing and Open Offer.
All of the new Ordinary shares were admitted to the London Stock Exchange for dealing on 19 August 2009.
Following the year end, the Deferred Shares have been redeemed and cancelled. This took place on 30 April 2010.
Potential issues of ordinary shares at the year end were as follows:
1996 Executive Share Option Scheme

Number of Exercise
11/07/00 543,689 6.57 11/07/03 to 10/07/10

21/08/00 1,439 6.30 21/08/03 to 20/08/10
23/02/01 38,433 7.48 23/02/04 to 22/02/11
04/07/01 28,419 8.09 04/07/04 to 03/07/11
09/07/01 3,442 8.22 09/07/04 to 08/07/11
09/12/02 122,749 3.85 09/12/05 to 08/12/12
22/05/03 214,261 3.73 22/05/06 to 21/05/13
14/07/04 27,572 3.86 14/07/07 to 13/07/14
25/07/05 119,503 4.82 25/07/08 to 24/07/15
25/07/06 174,871 5.23 25/07/09 to 24/07/16
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10 Share capital (continued)

Luminar Group Holdings 2007 Performance Share Plan
Number of Exercise
09/11/07 298,907 — 01/08/10 to 31/07/11

22/05/08 493,027 — 22/05/11 to 21/05/12
10/06/09 875,492 — 10/06/12 to 09/06/15
1999 Company Share Option Plan

Number of Exercise
21/08/00 2,547 6.30 21/08/03 to 20/08/10

04/07/01 3,706 8.09 04/07/04 to 03/07/11
09/07/01 2,395 8.22 09/07/04 to 08/07/11
25/07/03 18,680 4.15 25/07/06 to 24/07/13
25/07/05 30,981 4.82 25/07/08 to 24/07/15
25/07/06 20,590 5.23 25/07/09 to 24/07/16
* The numbers of ordinary shares under option, and their related exercise prices, have been amended to take account of the changes made to share capital during the year.
11 Share-based payments
The following share-based payment plans (with the exception of the performance share plan) were in existence in Luminar plc. Following the
Reorganisation, these plans are now in operation in Luminar Group Holdings plc.
The Group has followed the transitional arrangements within FRS 20, Share-based payment and has adopted the exemption from full retrospective
application of all share-based payment awards and has only applied the measurement requirements of FRS 20 to awards made after 7 November
2002. However, the following disclosures include all share-based payment awards, therefore including those equity-settled awards granted prior to
7 November 2002.
The Group operates the following share-based payment plans:
a) Deferred Bonus Plan

This was approved by Shareholders in 2004 and was operated in 2004 and 2005. Under the terms of the Plan, 50% of the bonus entitlement of
Executive Directors is deferred for three years into a deferred bonus award which is notionally invested in the Company’s shares. Any dividends
accruing on the notional shares are accrued to the benefit of the Executive Directors. Matching shares can be awarded (up to two matching shares
for each notional share), based on the Shareholder return of the Group relative to the FTSE 250 Index over the relevant three-year period.
All remaining options awarded under this scheme were exercised in the prior year.
b) 1996 Executive Share Option Scheme & 1999 Company Share Option Plan
Options granted under the 1996 Scheme (which are unapproved options) and the 1999 Plan (which are HM Revenue & Customs approved options)
are exercisable between three and ten years from the grant date, subject to the employee remaining in the service of the Group. Options were
originally granted subject to performance conditions requiring EPS growth over a three-year period. Outstanding options were rolled over into
equivalent options over shares in Luminar Group Holdings plc in connection with the Reorganisation in 2007. Following the technical change of
control of Luminar plc in connection with the Reorganisation, the Rules of the 1996 Scheme prescribed that unapproved options became
immediately exercisable, with performance conditions falling away, resulting in an exceptional charge during that year. Therefore, the exercise of the
rolled over unapproved options is not subject to any performance conditions. Similarly, rolled over approved options are not subject to performance
conditions, as prescribed by the rules of the 1999 Plan. This is a common provision in rules of this vintage. During the year, 462 options awarded under
this scheme in July 1999 and a further 1,000 awarded in August 1999 lapsed.
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c) Northern Leisure 1998 Executive Share Option Scheme (‘Rolled over’ options)
Options granted under the Northern Leisure scheme were granted to holders of existing super options of Northern Leisure plc, who elected to
release those in exchange for an equivalent option over Luminar plc shares, in connection with the acquisition of Northern Leisure plc In turn, these
new options were rolled over into options over shares in Luminar Group Holdings plc in connection with the Reorganisation.
All brought forward outstanding options lapsed during the prior year due to the passing of ten years from the grant date of the original super options
(June 1998). All options were granted prior to 7 November 2002 and accordingly were excluded from the scope of IFRS 2.
d) Warrant scheme
On 22 February 1999, the Shareholders approved the establishment of a discretionary Trust to hold warrants as part of incentive arrangements, under
which they are subsequently allocated to employees. Each warrant carried the right to subscribe for one Ordinary share at the price of £6.671/2 per
share. Performance criteria attached to the warrant scheme were met in full in February 2002. The warrants may be exercised in the period of 28 days
following the publication of the Annual Report of each financial year, up to the year ending on or around 1 March 2009.
Following this date passing, any outstanding share options awarded under this scheme have all now lapsed.
e) Luminar Group Holdings 2007 Performance Share Plan

This was approved by shareholders at the 2007 AGM. Under the terms of the Performance Share Plan, Executives can be awarded conditional awards
of free shares, which are capable of vesting subject to performance and continued service over a three year period. The first grants under the plan
were made in November 2007 and will vest on 1 August 2010. Additional grants were made under the plan in May 2008, which will vest on 22 May
2011, and in June 2009, which will vest on 10 June 2012.
The awards granted to Executive Directors and other senior Executives under the plan are subject to performance conditions relating to Total
Shareholder Return (50% of the award) and strategic milestone targets (50% of the award). See pages 46 and 47 of the Remuneration Report for
further details of these targets. The awards granted to other employees are subject to a sliding scale of operating profit targets based on Group and/or
venue/area performance.
In the event of a change of control, awards will vest early subject to performance and time prorating (although the Remuneration Committee has
the discretion not to apply time prorating if it considers it inappropriate to do so).
Reconciliations of the number and weighted average exercise price by option scheme are presented below (including grants of options prior to
7 November 2002):
Deferred Performance 1996 & 1999 Northern
Number of shares bonus plan share plan Scheme Warrants Leisure 1998
At 28 February 2008 31,751 345,720 1,566,958 4,066,322 23,000

Granted 1,625 567,779 — — —
Forfeited — (148,406) (118,149) — —
Lapsed — — (171,500) — (23,000)
Exercised (33,376) — — — —

At 26 February 2009 — 765,093 1,277,309 4,066,322 —

Adjust for share issue* — 66,777 111,575 355,309 —
Granted — 901,403 — — —
Forfeited — (65,847) (34,018) — —
Lapsed — — (1,589) (4,421,631) —

At 25 February 2010 — 1,667,426 1,353,277 — —

— 25 February 2010 — — 1,353,277 — —
— 26 February 2009 — — 1,097,292 4,066,322 —
* The number of Ordinary shares under option and their related exercise prices have been amended to take account of the changes made to share capital during the year (see note 10,
‘Share Capital’).
118

exercise price (£) bonus plan share plan Scheme Warrants Leisure 1998
At 28 February 2008 5.19 — 6.17 6.68 8.74

Granted 5.22 — — — —
Forfeited — — (7.40) — —
Lapsed — — (4.77) — (8.74)
Exercised (5.19) — — — —

At 26 February 2009 — — 5.94 6.68 —

Granted — — — — —
Forfeited — — (5.31) — —
Lapsed — — (0.55) (6.68) —

At 25 February 2010 — — 5.94 — —

— 25 February 2010 — — 5.94 — —
— 26 February 2009 — — 5.97 6.68 —

exercise price (£) bonus plan share plan Scheme Warrants Leisure 1998
For share options exercised during the year:

Average exercise price for options exercised
— year to 25 February 2010 — — — — —
— year to 26 February 2009 5.19 — — — —
For share options outstanding at the end of the year:

Range of exercise prices
— year to 25 February 2010 — — 4.06–9.38 — —
— year to 26 February 2009 — — 4.06–9.38 6.675 —
Weighted average remaining contractual life (in years)

— year to 25 February 2010 — 1.4 2.6 — —
— year to 26 February 2009 — 2.4 3.7 0.3 —
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The fair value for options granted during the year has been determined using a stochastic model. The assumptions and inputs to the model for
options granted during the year were as follows:
Performance
Share Plan
Weighted average fair value of options at grant date £1.412

Weighted average exercise price £0
Expected volatility 56.9%
Option life 3 years
Risk-free interest rate 2.32%
Expected dividend growth 0%
The expected volatility is estimated using the historical volatility of the Group’s shares over a period equivalent to the expected life of the option.
The Company recognised a total charge within administrative expenses of £0.3m (2009: £0.2m) and exceptional items of £nil (2009: £0.1m), related to
share-based payment transactions, all of which were accounted for as equity-settled share-based payment arrangements with a corresponding credit
direct to equity reserves. The cumulative credit to equity reserves in respect of share-based payments totalled £1.7m (2009: £1.2m).
12 Capital and reserves

Capital Profit
Share Share Equity redemption and loss
capital premium reserve reserve reserve Total
£m £m £m £m £m £m

Issues of shares 9.9 25.8 — — — 35.7
Loss for the financial year (note 1) — — — — (132.3) (132.3)
Share-based payment charge — — 0.5 — — 0.5

At 25 February 2010 131.8 25.8 4.8 42.1 28.4 232.9

Distributable reserves — — — — 28.4 28.4
Non-distributable reserves 131.8 25.8 4.8 42.1 — 204.5
The loss for the year of £132.3m (2009: £0.2m) includes a £132.6m write-down in the investment value of Luminar Holdings Limited.
13 Reconciliation of movements in shareholders’ funds

£m
Opening Shareholders’ funds at 27 February 2009 329.0

Loss for the financial year (note 1) (132.3)
Issue of shares 35.7
Share-based payment charge 0.5

Closing shareholders’ funds at 25 February 2010 232.9
14 Contingent liabilities
The Company had no contingent liabilities at 25 February 2010 or at 26 February 2009.
15 Capital commitments
The Company had no capital commitments at 25 February 2010 (2009: None).
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Pictured Below
Impressive frontage at Liquid, Romford.
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126 Explanatory Notes to the Notice of Annual General Meeting
129 Appendix One
134 Appendix Two
122
Notice of Annual General Meeting
Notice is hereby given that the Annual General Meeting of Luminar Group Holdings plc (“the Company”) will be held at the Company’s registered office,
Luminar House, Deltic Avenue, Rooksley, Milton Keynes, MK13 8LW on Tuesday 13 July 2010 at 1.00 pm for the transaction of the following business:
Ordinary Business
1. To receive the audited accounts for the year ended 25 February 2010 and the reports of the Directors and the Auditors thereon.
2. To approve the Directors’ remuneration report for the year ended 25 February 2010.
3. To elect Simon Douglas as a Director.
4. To elect Philip Bowcock as a Director.
5. To elect John Leach as a Non-Executive Director.
6. To re-elect John Jackson as a Non-Executive Director.
7. To re-elect Debbie Hewitt as a Non-Executive Director.
8. To reappoint PricewaterhouseCoopers LLP as Auditors of the Company to hold office until the conclusion of the next general meeting at which
accounts are laid before the Company.
9. To authorise the Directors to determine the Auditors’ remuneration.
Special Business
To consider and, if thought fit, pass resolutions 10, 11 and 12 as ordinary resolutions and resolutions 13 to 16 (inclusive) as special resolutions.
10. THAT the Directors be generally and unconditionally authorised, in accordance with section 551 of the Companies Act 2006 (the “Act”), to exercise
all powers of the Company to allot shares in the Company, grant rights to subscribe for, or to convert any security into, shares in the Company up to
an aggregate nominal amount of £16,737,108 comprising:
(a) up to an aggregate nominal amount of £8,368,554 (whether in connection with the same offer or issue as under (b) below or otherwise); and
(b) up to an aggregate nominal amount of £8,368,554 in the form of equity securities (within the meaning of section 560 of the Act) in connection
with an offer or issue by way of rights, open for acceptance for a period fixed by the Directors, to holders of ordinary shares (other than the
Company) on the register on any record date fixed by the Directors in proportion (as nearly as may be) to the respective number of ordinary
shares deemed to be held by them, subject to such exclusions or other arrangements as the Directors may deem necessary or expedient in
relation to fractional entitlements, legal or practical problems arising in any overseas territory, the requirements of any regulatory body or stock
exchange or any other matter whatsoever.
This authority shall expire (unless previously varied, revoked or renewed by the Company in general meeting) at the conclusion of the Annual
General Meeting of the Company in 2011 or, if earlier, 12 October 2011, except that the Company may before such expiry make an offer or
agreement which would or might require shares to be allotted after such expiry and the Directors may allot shares in pursuance of such offer or
agreement as if the authority conferred by this resolution had not expired.
11. THAT the Luminar Group Holdings plc 2010 Long-Term Incentive Plan (the “LTIP”), the principal terms of which are summarised in Appendix One
to this notice and the rules of which are produced to the meeting and initialled by the Chairman for the purposes of identification, is approved
and the Directors are hereby authorised to make such modifications to the LTIP as they may consider appropriate to obtain formal HM Revenue &
Customs approval of Part A of the LTIP and for the implementation of the LTIP and to implement the LTIP as so modified and to do all such other
acts and things as they may consider necessary or expedient to implement the LTIP.
12. THAT the proposed amendment to the rules of the Luminar Group Holdings plc 2007 Performance Share Plan (the “2007 PSP”) as set out in the
draft produced to the meeting, which is initialled by the Chairman for the purposes of identification, be approved and the Directors are hereby
authorised to adopt the amendment and to implement the 2007 PSP as so modified.
13. THAT, subject to the passing of resolution 10 above, the Directors be empowered pursuant to section 570 of the Act to allot equity securities (as
defined in section 560(1), (2) and (3) of the Act) for cash pursuant to the authority conferred on them by resolution 10 above and/or to sell equity
securities held as treasury shares for cash pursuant to sections 727 and 729 of the Act, in each case as if section 561(1) of the Act did not apply to
any such allotment or sale, provided that this power shall be limited to:
(a) any such allotment and/or sale of equity securities in connection with an offer or issue by way of rights or other pre-emptive offer or issue,
open for acceptance for a period fixed by the Directors, to holders of ordinary shares (other than the Company) on the register on any record
date fixed by the Directors in proportion (as nearly as may be) to the respective number of ordinary shares deemed to be held by them, subject
to such exclusions or other arrangements as the Directors may deem necessary or expedient in relation to fractional entitlements, legal or
practical problems arising in any overseas territory, the requirements of any regulatory body or stock exchange or any other matter whatsoever;
and
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(b) any such allotment and/or sale, otherwise than pursuant to sub-paragraph (a) above, of equity securities having an aggregate nominal value,
not exceeding the sum of £1,255,283.
This authority shall expire, unless previously revoked or renewed by the Company in general meeting, at such time as the general authority conferred
on the Directors by resolution 10 above expires, except that the Company may at any time before such expiry make any offer or agreement which
would or might require equity securities to be allotted or equity securities held as treasury shares to be sold after such expiry and the Directors may
allot equity securities and/or sell equity securities held as treasury shares in pursuance of such an offer or agreement as if the power conferred by this
resolution had not expired.
14. THAT the Company be and is hereby generally and unconditionally authorised for the purposes of section 701 of the Act to make one or more
market purchases (within the meaning of section 693(4) of the Act) of its ordinary shares of 25 pence (“Ordinary Shares”) each on such terms and in
such manner as the Directors shall determine and to cancel or hold in treasury such shares, provided that:
(a) the maximum aggregate number of ordinary shares hereby authorised to be purchased is 10,042,265;
(b) the minimum price (excluding expenses) which may be paid for each Ordinary Share is an amount equal to 75% of the average of the closing
mid-market prices for the ordinary shares of the Company (derived from the Daily Official List of the London Stock Exchange) for the five
business days immediately preceding the date of purchase;
(c) the maximum price (excluding expenses) which may be paid for each Ordinary Share is an amount equal to the higher of (i) 105% of the
average of the closing mid-market prices for the Ordinary Shares of the Company (derived from the Daily Official List of the London Stock
Exchange) for the five business days immediately preceding the date on which the Ordinary Share is contracted to be purchased; and (ii) the
price stipulated by Article 5(1) of the Buy-Back and Stabilisation Regulation 2003; and
(d) unless previously renewed, varied or revoked by the Company in general meeting, the authority hereby given shall expire at the conclusion
of the Annual General Meeting of the Company in 2011 or, if earlier, 12 October 2011, save that the Company may make any purchase of
Ordinary Shares after the expiry of such authority in execution of a contract of purchase that was made under and before the expiry of such
authority.
15. THAT, with immediate effect:

15(a) the Articles of Association of the Company be amended by deleting all the provisions of the Company’s Memorandum of Association which,
by virtue of section 28 of the Act, are to be treated as provisions of the Company’s Articles of Association; and
15(b) the Articles of Association produced to the meeting and initialled by the Chairman of the meeting for the purpose of identification be
adopted as the Articles of Association of the Company in substitution for, and to the exclusion of, the existing Articles of Association of the
Company.
16. THAT a general meeting of the Company, other than an Annual General Meeting of the Company, may be called on not less that 14 clear days’
notice.
The Directors believe that the proposals in resolutions 1 to 16 are in the best interests of the Company and Shareholders as a
whole. The Directors unanimously recommend that you vote in favour of the resolutions as they intend to do in respect of their own
beneficial holdings.
By Order of the Board

Tim O’Gorman
Company Secretary
12 May 2010
Registered Office:
Luminar House
Deltic Avenue
Milton Keynes
Buckinghamshire
MK13 8LW
(Company Number 6239034)
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Notice of Annual General Meeting
NOTES
Entitlement to Attend and Vote
1. Only those members registered on the Company’s register of members at:
6.00 pm on 11 July 2010; or
if the meeting is adjourned, at 6.00 pm on the day two days prior to the adjourned meeting,

shall be entitled to attend and vote at the Annual General Meeting. Changes to the Company’s register of members after the relevant deadline shall
be disregarded in determining the rights of any person to attend and vote at the meeting.
Website giving information regarding the meeting

2. Information regarding the meeting, giving the information required by section 311A of the Act, is available from www.luminar.co.uk.
Attending in person
3. If you wish to attend the meeting in person, details of the date, venue and time of the meeting are set out in paragraph 20 below.
Appointment of proxies
4. Members are entitled to appoint a proxy to exercise all or any of their rights to attend and to speak and vote on their behalf at the meeting. A
Shareholder may appoint more than one proxy in relation to the Annual General Meeting provided that each proxy is appointed to exercise the
rights attached to a different share or shares held by that Shareholder. A proxy need not be a Shareholder of the Company. You can only appoint a
proxy using the procedures set out in these notes and the notes to the proxy form. A Form of Proxy which may be used to make such appointment
and give proxy instructions accompanies this notice. If you do not have a Form of Proxy and believe that you should have one, or if you require
additional forms, please contact Capita Registrars Limited, the Company’s registrars, on 0871 664 0300 (calls cost 10p per minute plus network
extras); or +44 208 639 3399 (if calling from overseas).
5. To be valid, the enclosed Form of Proxy, together, if appropriate, with the power of attorney or the authority (if any) under which it is signed, or a
notarially certified copy of such power or authority, must be deposited at the offices of Capita Registrars Limited, PXS, The Registry, 34 Beckenham
Road, Beckenham, Kent, BR3 4TU by no later than 1.00 pm on 11 July 2010.
6. The return of a completed Form of Proxy or any CREST Proxy Instruction (as described below) will not prevent a Shareholder attending the Annual
General Meeting and voting in person if he/she wishes to do so.
7. A vote withheld is not a vote in law, which means that the vote will not be counted in the calculation of votes for and against the resolution. If no
voting indication is given, your proxy will vote or abstain from voting at his or her discretion. Your proxy will vote (or abstain from voting) as he or
she thinks fit in relation to any other matter that is put before the meeting.
Electronic appointment of proxies

8. As an alternative to completing the hard copy proxy form, you can appoint a proxy electronically at www.capitashareportal.com. For an electronic
proxy appointment to be valid, your appointment must be received by Capita Registrars Limited by no later than 1.00 pm on 11 July 2010.
Nominated Person
9. Any person to whom this notice is sent who is a person nominated under section 146 of the Act to enjoy information rights (a “Nominated
Person”) may, under an agreement between him/her and the shareholder by whom he/she was nominated, have a right to be appointed (or to have
someone else appointed) as a proxy for the Annual General Meeting. If a Nominated Person has no such proxy appointment right or does not wish
to exercise it, he/she may, under any such agreement, have a right to give instructions to the shareholder as to the exercise of voting rights.
10. The statement of the rights of shareholders in relation to the appointment of proxies above does not apply to Nominated Persons. The rights
described in these notes can only be exercised by shareholders of the Company
Appointment of proxies using CREST

11. CREST members who wish to appoint a proxy or proxies through the CREST electronic proxy appointment service may do so by using the
procedures described in the CREST Manual. CREST Personal Members or other CREST sponsored members, and those CREST members who have
appointed a service provider(s), should refer to their CREST sponsor or voting service provider(s), who will be able to take the appropriate action on
their behalf.
12. In order for a proxy appointment or instruction made using the CREST service to be valid, the appropriate CREST message (a “CREST Proxy
Instruction”) must be properly authenticated in accordance with Euroclear UK & Ireland Limited’s specifications, and must contain the information
required for such instruction, as described in the CREST Manual. The message, regardless of whether it constitutes the appointment of a proxy or is
an amendment to the instruction given to a previously appointed proxy must, in order to be valid, be transmitted so as to be received by the issuer’s
agent (ID RA10) by 1.00 pm on 11 July 2010. For this purpose, the time of receipt will be taken to be the time (as determined by the timestamp
applied to the message by the CREST Application Host) from which the Company’s agent is able to retrieve the message by enquiry to CREST in
the manner prescribed by CREST. After this time any change of instructions to proxies appointed through CREST should be communicated to the
appointee through other means.
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13. CREST members and, where applicable, their CREST sponsors, or voting service providers should note that Euroclear UK & Ireland Limited does not
make available special procedures in CREST for any particular message. Normal system timings and limitations will, therefore, apply in relation to the
input of CREST Proxy Instructions. It is the responsibility of the CREST member concerned to take (or, if the CREST member is a CREST personal
member, or sponsored member, or has appointed a voting service provider, to procure that his CREST sponsor or voting service provider(s) take(s))
such action as shall be necessary to ensure that a message is transmitted by means of the CREST system by any particular time. In this connection,
CREST members and, where applicable, their CREST sponsors or voting system providers are referred, in particular, to those sections of the CREST
Manual concerning practical limitations of the CREST system and timings.
14. The Company may treat as invalid a CREST Proxy Instruction in the circumstances set out in Regulation 35(5)(a) of the Uncertificated Securities
Regulations 2001.
Corporate Representatives
15. Any corporation which is a member can appoint one or more corporate representatives who may exercise on its behalf all of its powers as a
member provided that they do not do so in relation to the same shares.
Issued Shares and Voting Rights

16. As at 12 May 2010 (being the latest practicable date prior to the publication of this Notice) the Company’s issued share capital consisted of
100,442,654 ordinary shares carrying one vote each. Therefore, the total voting rights in the Company as at 12 May 2010 were 100,442,654 ordinary
shares carrying one vote each.
Website publication of audit concerns

17. Shareholders should note that it is possible that, pursuant to requests made by Shareholders of the Company under section 527 of the Act, the
Company may be required to publish on a website a statement setting out any matter relating to: (i) the audit of the Company’s accounts (including
the Auditors’ report and the conduct of the audit) that are to be laid before the Annual General Meeting; or (ii) any circumstance connected with an
auditor of the Company ceasing to hold office since the previous meeting at which annual accounts and reports were laid in accordance with section
437 of the Act. The Company may not require the shareholders requesting any such website publication to pay its expenses in complying with sections
527 or 528 of the Act. Where the Company is required to place a statement on a website under section 527 of the Act, it must forward the statement
to the Company’s Auditors not later than the time when it makes the statement available on the website. The business which may be dealt with at the
Annual General Meeting includes any statement that the Company has been required under section 527 of the Act to publish on a website.
Answering Questions
18. Under section 319A of the Act, the Company must answer any question you ask relating to the business being dealt with at the meeting unless:
answering the question would interfere unduly with the preparation for the meeting or involve the disclosure of confidential information;
the answer has already been given on a website in the form of an answer to a question; or
it is undesirable in the interests of the Company of the good order of the meeting that the question be answered.
Documents for Inspection

19. The following documents are available for inspection during normal business hours on any weekday (public holidays excepted) at Luminar House,
Deltic Avenue, Milton Keynes, Buckinghamshire, MK13 8LW until the day and time the Annual General Meeting concludes:
copies of the Executive Directors’ service contracts;
copies of letters of appointment of the Non-Executive Directors;
a copy of the rules of the proposed Luminar Group Holdings plc 2010 Long-Term Incentive Plan and a copy of the rules of the Luminar Group
Holdings plc 2007 Performance Share Plan (incorporating the proposed amendments) which will additionally be available for inspection at the
offices of Hewitt Associates, 6 More London Place, London, SE1 2DA during normal business hours on any weekday (public holidays excepted)
until the day and time the Annual General Meeting concludes; and
the current and proposed new Articles of Association.
Annual General Meeting Information

20. The meeting will be held on Tuesday 13 July 2010 at the Company’s registered office at Luminar House, Deltic Avenue, Milton Keynes,
Buckinghamshire, MK13 8LW.
The meeting will start at 1.00 pm. Please arrive no later than 12.50 pm for registration.
Tea, coffee and light refreshments will be served from 12.30 pm.
Addresses (including electronic addresses) in this document are included strictly for the purposes specified and not for any other purpose.
126
Explanatory Notes to the Notice

of Annual General Meeting
1. Directors’ Report and Accounts (resolution 1)

The Directors are required by the Act to present to the meeting the Directors’ and Auditors’ reports and the audited accounts for the year ended
25 February 2010. The report of the Directors and the audited accounts have been approved by the Directors, and the report of the Auditors has
been approved by the Auditors, and a copy of each of these documents may be found in the annual report and accounts, starting at page 49.
2. Consider and adopt the Report on Remuneration (resolution 2)

The Directors are also required to present the Directors’ Remuneration Report for approval. The Report is set out on pages 40 to 48. If Shareholders
vote against the report the Directors will still be paid, but the Remuneration Committee will reconsider its policy.
3. Re-election of Directors (resolutions 3 to 7)

Article 99 of the Company’s Articles of Association states that any Director who has not been appointed or reappointed at either of the Company’s
last two Annual General Meetings should retire. Accordingly, John Jackson and Debbie Hewitt are retiring and offering themselves for re-election
under this provision. Alan Jackson has decided to step down as Chairman at the end of his current three year appointment on 13 July 2010 and will
not be offering himself for re-election.
Article 103.1 of the Company’s Articles of Association allows the Board to appoint a person to the Board subject to that person being re-elected at
the subsequent Annual General Meeting. Simon Douglas was appointed on 23 February 2010, John Leach on 30 April 2010 and Philip Bowcock on
1 June 2010 and are, therefore, offering themselves for election by Shareholders for the first time.
The Nominations Committee has confirmed, as required by the Combined Code, that, following the completion of the annual performance
evaluation and appraisal exercise, the performance of John Jackson and Debbie Hewitt continues to be effective and that these Directors
demonstrate commitment to their roles.
In the case of Simon Douglas, John Leach and Philip Bowcock, who have not previously been the subject of a vote by Shareholders, the Board
believes that their considerable experience will, together with their other attributes as described in their biographies set out below, be of great benefit
to the Board and the Company.
The Board therefore supports the re-election of John Jackson and Debbie Hewitt and the election of Simon Douglas, John Leach and Philip Bowcock.
Biographical details of all of the Directors are set out on pages 30 and 31 of the Annual Report and accounts.
4. Appointment and remuneration of Auditors (resolutions 8 and 9)

These resolutions propose the reappointment of PricewaterhouseCoopers LLP as the Company’s Auditors and permit the Directors to determine
their remuneration.
5. Renewal of authority to allot shares (resolutions 10 and 13)

The existing authorities given to the Directors at the last Annual General Meeting to allot unissued share capital and to allot shares for cash in limited
circumstances expire on 13 July 2010. It is proposed that further authorities be granted which shall expire on the date of the Annual General Meeting
of the Company in 2011 or, if earlier, 12 October 2011. An ordinary resolution (resolution 10) will be proposed to authorise the Directors to allot
the Company’s unissued shares up to a maximum nominal amount of £16,737,108, which represents an amount which is approximately equal to
two-thirds of the issued ordinary share capital of the Company as at 12 May 2010, the latest practicable date prior to the publication of the notice.
As at that date, the Company did not hold any treasury shares. As provided in paragraph (a) of the resolution, up to half of this authority (equal to
one-third of the issued share capital of the Company) will enable Directors to allot and issue new shares in whatever manner they see fit. Paragraph
(b) of the resolution provides that the remainder of the authority (equal to a further one-third) may only be used in connection with a rights issue in
favour of ordinary shareholders. As paragraph (a) imposes no restrictions on the way the authority may be exercised, it could be used in conjunction
with paragraph (b) so as to enable the whole two-thirds authority to be used in connection with a rights issue. This accords with guidance issued by
the Association of British Insurers in December 2008.
Passing resolution 10 will ensure that the Directors continue to have the flexibility to act in the best interests of shareholders, when opportunities
arise, by issuing new shares. There are no present plans to issue shares, except as required to satisfy the exercise of options under the Company’s
employee share incentive schemes.
The Company does not at present hold any shares in treasury.

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A special resolution (resolution 13) will be proposed authorising the Directors to issue shares for cash up to an aggregate nominal amount of
£1,255,283 (up to 5,021,132 new ordinary shares of 25 pence each) (representing approximately 5% of the Company’s issued share capital as at
12 May 2010, being the latest practicable date prior to the publication of the notice) without offering them to Shareholders first, and to modify
statutory pre-emption rights to deal with legal, regulatory or practical problems that may arise on a rights or other pre-emptive offer or issue. If
passed, this authority will expire at the same time as the authority to allot shares given pursuant to resolution 10. The Directors do not intend to
issue more than 7.5% of the issued share capital on a non-pre-emptive basis in any rolling three-year period.
6. Approval of LTIP (resolution 11)

In recent years, the Company has been operating in a very difficult trading environment, with unprecedented market conditions.
The Company has recently recruited a new Chief Executive Officer (“CEO”). The Remuneration Committee considers that it is essential to put in
place an appropriate incentive for the new CEO and senior management team for achieving the recovery of sales, profit growth, cash generation and
share price growth.
The proposed LTIP is a ‘one-off’ arrangement, based on an award of options to purchase the Company’s shares in the future, at a price set at the
outset. The total number of shares over which options may be granted under the LTIP equates to 7% of the issued share capital as at 8 March 2010
(being the date of the appointment of the CEO). The CEO will receive options over 40%. of this LTIP pool and the remainder of the pool will be
allocated amongst certain senior executives, as determined by the CEO and Remuneration Committee.
The current intention is that, to the extent possible, the LTIP options will be satisfied with market-purchased shares.
The exercise price of the options will be set by reference to the share price on 8 March 2010, being the date of appointment of the CEO (other than
for HMRC Approved options where the exercise price will be set by reference to the share price at the time of grant).
The aim of the LTIP is to provide a focused reward structure for the CEO and other senior Executives which will be based on a combination of the
following three performance criteria:
share price target range (above a minimum of £1.50, providing incrementally higher reward at higher levels of growth);
relative total shareholder return performance against a bespoke peer group of nine competitors; and
a hurdle requiring average annual ROCE over the performance period to be 8% or more.
The performance conditions will be measured over a five-year period commencing 8 March 2010 (other than the ROCE condition which will be
measured over five financial years commencing with the 2010/11 financial year). To the extent that any of the performance conditions are met early,
after only three years, the option may vest at that time. However, only 50% of any vested option may be exercised after three years, and the remaining
50% of the vested option will be ‘banked’ and will only become exercisable at the end of the full five-year period (provided that the participant
remains in employment at that time).
Any part of the option which did not vest early, after three years, will remain subject to the performance conditions which will be assessed over the
full five-year performance period.
Outstanding options (both vested and unvested) will lapse on cessation of employment, unless such cessation is for a specified ‘good leaver’ reason.
In future years, the intention is to return to a normal annual grant policy under the existing Performance Share Plan. However, the Remuneration
Committee considers that the LTIP is an essential incentive tool at this stage, to provide a focused incentive to achieve the recovery of the Company
in the current difficult market conditions.
In recognition of the size of the proposed LTIP grant, the CEO has agreed to a reduced salary of £300,000 p.a. (which is significantly less than the
£450,000 salary of the previous CEO).
In addition, participants in the new LTIP will be expected to build a shareholding in the Company, to the value of 50% of their salary, within three
years of the adoption of the LTIP, and 100% of their salary within five years of the adoption of the LTIP.
This LTIP proposal has been discussed with the Company’s major institutional shareholders.
A summary of the terms of the LTIP are set out in Appendix One to this notice on page 129 and the entire document is available for inspection as
noted in paragraph 19 above.
128
Explanatory Notes to the Notice of

Annual General Meeting (continued)
7. Proposed amendments to the 2007 Performance Share Plan (“2007 PSP”) (resolution 12)
This resolution deals with the proposed amendment to the dilution limits under the rules of the 2007 PSP.
The total number of shares over which options may be granted under the proposed new LTIP equates to 7 % of the issued share capital as at
8 March 2010.
Although the current intention is to satisfy options under the proposed LTIP with market-purchased shares, to the extent possible, the LTIP includes
the flexibility for options to be satisfied with newly issued shares. To facilitate the operation of the LTIP and to ensure that there is sufficient flexibility
to operate the 2007 PSP in future years, it is proposed that options granted, and shares issued, under the LTIP will not count towards the ‘5% in 10
years for executive schemes’ and ‘10% in 10 years for all schemes’ dilution limits in the 2007 PSP.
This requires an amendment to be made to the rules of the 2007 PSP and that amendment is proposed by this resolution.
8. Authority to purchase own shares (resolution 14)

This special resolution would authorise the Company to acquire its own shares subject to the constraints set out in the resolution. The resolution
limits the number of shares that may be purchased to 10% of the Company’s issued share capital as at 12 May 2010, being the latest practicable
date prior to the publication of the notice of meeting. The Directors would exercise this power only if satisfied that it was in the interests of the
Shareholders as a whole to do so and that it was likely to result in an increase in earnings per share. Any shares purchased in accordance with this
authority will subsequently be cancelled. The effect of any cancellation would be to reduce the number of shares in issue.
The buy-back authority would be limited to purchases of up to 10,042,265 ordinary shares of 25 pence representing 10%. of the issued share capital
of the Company as at 12 May 2010 (being the latest practical date prior to the publication of this notice). The resolution specifies the maximum
price at which the shares may be bought. The Company is required to state a minimum price at which shares may be purchased by the Company
and it is conventional for it to state that shares will not be purchased at a price that is less than their nominal value. Accordingly, in order to provide
maximum flexibility, the Directors propose that the authority permits a minimum buy-back price equal to 75% of the average of the closing mid-
market prices for the ordinary shares of the Company (derived from the Daily Official List of the London Stock Exchange) for the five business days
immediately preceding the date of purchase.
As at 12 May 2010, being the latest practicable date prior to the publication of the notice, exerciseable options were outstanding to subscribe for a
total number of 1,353,277 ordinary shares, or 1.34% of the Company’s issued share capital. If this authority to purchase shares were used in full, the
exercisable options would represent 1.49% of the adjusted, reduced issued share capital.
9. Adoption of new Articles of Association (resolution 15)

It is proposed, in resolution 15(b), to adopt new articles of association (“New Articles”) in order to update the Company’s current Articles
of Association (“Current Articles”), primarily to take account of the introduction of the Companies (Shareholders’ Rights) Regulations 2009
(“Shareholders’ Rights Regulations”) and the implementation of the last parts of the Companies Act 2006.
The New Articles make no reference to deferred shares. All of the deferred shares in the Company arising from the capital reorganisation in August
2009 were subsequently transferred to the Company for no consideration in accordance with the provisions of the Current Articles, whereupon
such deferred shares were all cancelled. The Company has no intention of reissuing deferred shares, and therefore to simplify the share capital of
the Company the New Articles make no reference to deferred shares. This has no effect on Shareholders’ existing holdings of ordinary shares in the
Company.
The principal differences between the Current Articles and the New Articles are set out in Appendix Two together with an explanation of resolution
15(a). Other changes which are of a minor, technical or clarifying nature have not been noted.
A copy of the New Articles and a copy of the Current Articles marked to show the changes being proposed by this resolution are available for
inspection as noted in paragraph 19 to this notice.
10. Notice to call a General Meeting (resolution 16)

The Act in conjunction with the Shareholders Rights Directive permits listed companies to call meetings on 14 days’ notice, provided that the
Shareholders have approved the holding of general meetings on 14 clear days’ notice by passing an appropriate resolution at the immediately
preceding Annual General Meeting or at a general meeting held since the immediately preceding Annual General Meeting. Passing resolution 16
will authorise the Company to call the general meetings on 14 days’ notice. The approval will be effective until the Company’s next Annual General
Meeting, when it is intended that a similar resolution will be proposed.
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Appendix One — Summary of the Principal Terms Consolidated Financial Statements
of the Luminar Group Holdings 2010 Long-Term Company Financial Statements
Incentive Plan (the “Ltip”)
General
The LTIP is divided into two parts. Part A is intended to be approved by HM Revenue & Customs (“HMRC”) so that options granted under it may qualify
for beneficial tax treatment in the UK. Part B will be used to grant non-tax favoured options. Both parts of the LTIP are identical in all material respects
unless otherwise indicated in this summary (or where changes to Part A are required by HMRC in order to satisfy the requirements for formal approval of
the LTIP).
Operation
The Remuneration Committee of the Board of Directors of the Company (the “Committee”) will supervise the operation of the LTIP.
Eligibility
Any employee (including Executive Directors) of the Company and its subsidiaries will be eligible to participate in the LTIP at the discretion of the
Committee. However, the intention is for participation to be limited to the Executive Directors and certain key senior executives.
Participation in the Company’s existing Performance Share Plan

A participant in the LTIP will not be eligible to receive an award under the Company’s existing Performance Share Plan in the financial year in which they
are granted an award under the LTIP.
Grant of Awards
The LTIP is a ‘one-off’ arrangement, under which options to acquire ordinary shares in the Company (“Shares”) may be granted to selected executives.
Options granted under Part B of the LTIP may be settled in cash (although the Committee does not currently intend to do so). There will also be a
provision for the Committee to elect to satisfy the exercise of an option granted under Part B of the LTIP by delivering shares which are equivalent in
value to the aggregate gain arising on exercise.
The intention is for options to be granted to the Executive Directors as soon as practicable following shareholder approval for the LTIP. In exceptional
circumstances, options may be granted to other senior executives at any time during the five-year performance period of the LTIP, when the Committee
determines that the circumstances justify such a grant, provided that the Company is not in a prohibited period. Any such subsequent grants will be on
the same terms, and subject to the same performance conditions, as the initial grants to the Executive Directors (see below). However, the intention is
that the majority of grants will be made in the period following Shareholder approval of the LTIP.
Options may not be granted under Part A of the LTIP until HMRC approval has been obtained.
No payment is required for the grant of an option. Options are not transferable, except on death. Options are not pensionable.
Individual and overall grant limits
The LTIP may operate over new issue Shares, treasury Shares or Shares purchased in the market. Options granted, and shares issued, under the LTIP will
not count towards the dilution limits in the Company’s existing Performance Share Plan. The current intention is to satisfy options under the LTIP with
market-purchased shares to the extent possible.
The total number of Shares over which options may be granted under the LTIP is 7% of issued share capital as at 8 March 2010, subject to adjustment
in the event of any variations in the share capital of the Company or in the event of a demerger, special dividend or other similar event which materially
affects the market price of the Shares.
The CEO will receive options over 40%%. of this LTIP ‘pool’ (i.e. 2.8% of the issued share capital as at 8 March 2010) and the remainder of the LTIP pool
will be allocated amongst certain senior executives, as determined by the Committee in discussion with the CEO.
No employee may hold more than £30,000 worth of HMRC approved options (calculated by reference to their market value at the date of grant).
Option exercise price

The price per Share payable upon the exercise of an option granted under Part A (the HMRC-approved part) of the LTIP will not be less than:
(a) the middle market price of a Share on the London Stock Exchange on the dealing day immediately before the date of grant (or such other dealing
day(s) as the Committee may decide and agree with HMRC); and
(b) if the option relates only to new issue Shares, the nominal value of a Share.
The price per Share payable upon the exercise of an option granted under Part B of the LTIP (which is not HMRC-approved) will be [36 pence] being the
middle market share price of a share on the London Stock Exchange on 8 March 2010.
130
Appendix One — Summary of the Principal Terms of the Luminar

Group Holdings 2010 Long-Term Incentive Plan (the “Ltip”)
(continued)
Performance Conditions
The extent to which an option may eventually be exercised will depend upon three performance conditions based on share price, relative TSR (as defined
below) performance and average annual growth in ROCE (as defined below) over the performance period.
Performance will be measured over five years from 8 March 2010 other than the ROCE performance condition which will be measured over five financial
years commencing with the 2010/11 financial year. However, there will be an early testing opportunity after three years (see below). The performance
conditions will be measured in accordance with the three steps set out below.
Step 1: share price

The option is subject to a performance condition based on the Company’s share price.
The potential level of vesting of the option under the share price performance condition will be calculated in accordance with the following table:
End Price % of option that may vest under Step 1
Less than £1.50 0%

Between £1.50 and £2.50 1/7th (i.e. 14.28%)
£6.51 or more 100%
The End Price is the average share price over the three months immediately preceding 8 March 2015 (rounded down to the nearest full penny).
Step 2: Relative TSR performance

The option is also subject to a performance condition measuring the Company’s total Shareholder return (“TSR”) performance against that of a Group of
comparator companies over the five-year performance period which commences on the 8 March 2010.
The extent to which the part of the option that vests under Step 1 above (the ‘Step 1 vested proportion’) will vest under this Step 2 will be calculated as
follows:
TSR performance of the Company against that of the comparator group % of ‘Step 1 vested proportion’ that may vest under Step 2
At or above upper quintile 100%

At or above 2nd quintile but below upper quintile 50%
Below 2nd quintile 0%
It is intended that the TSR comparator group will comprise the following companies — Domino’s Pizza, Enterprise Inns, Fullers, Greene King, JD Wetherspoons,
Marstons, M&B, Punch Taverns and Youngs. The Company will be included in the comparator group for the purposes of assessing the TSR performance
condition.
For these purposes, for the Company and each other member of the comparator group, the TSR over the last three months of the performance period will
be compared to the TSR over the three months immediately preceding the start of the performance period.
Step 3: ROCE
Notwithstanding the satisfaction of the performance conditions under Steps 1 and 2 above, the option will not vest unless the average annual Return on
Capital Employed (“ROCE”) over the five financial years commencing with the 2010/11 financial year is 8%. or more.
For these purposes, ROCE means EBIT (of continuing businesses pre-exceptional items) in relation to total assets less current liabilities. ‘Total assets’ is
defined as net assets plus bank (including finance leases) debt less cash. Any asset write-downs will be added back to net assets unless the Committee
considers it appropriate not to do so. The Committee may determine whether exceptional items, negative or positive, are included or excluded.
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Early measurement of performance conditions after three years

The performance conditions referred to above will also be measured after three years. An option may vest at that stage, to the extent that the
performance conditions have been met at that time. However, as noted below, only 50% of any vested option may be exercised at that time. The
remaining 50% of the vested option will be ‘banked’ and will only become capable of exercise at the end of the full five-year performance period (see
‘Vesting of options’ below).
Where the option vested in part after only three years, any unvested part will only vest under Step 1 at the end of the five-year performance period to the
extent that the share price hurdles which were met after three years are improved upon.
Amending the performance conditions

If at any time the Committee determines that the TSR comparator group is no longer appropriate, for example because of an acquisition, or merger,
of any of the various companies, it may change the comparator group in such a way as it shall determine. This may include adding companies to the
comparator group or substituting the bespoke comparator group for an appropriate FTSE index and making consequential changes to the vesting hurdles
(e.g. changing the requirement for upper or 2nd quintile performance to a requirement for upper or 2nd quartile performance). The Committee must
consider that the varied comparator group is fair and reasonable and not materially less challenging than the original conditions would have been but for
the event in question.
The Committee may vary the performance conditions if an event has occurred which causes the Committee to consider that it would be appropriate
to amend the performance conditions, provided the Committee considers that the varied conditions are fair and reasonable and not materially less
challenging than the original conditions would have been but for the event in question.
In particular, and without limitation, in the event of a variation in the share capital of the Company or any demerger or other similar event which
materially affects the market value of a share, the Committee may amend the share price hurdles on such basis as they consider to be fair and reasonable,
provided that the amended hurdles are not materially less challenging than the original conditions would have been but for the event in question.
Vesting of options
Options will vest, and may be exercised, to the extent that the performance conditions (see above) have been satisfied at the end of the five-year
performance period provided the participant is still employed by the Company at that time.
However, if, following early assessment of the performance conditions after three years, part of the option vests, 50% of that vested part may be
exercised at that time. The remaining 50% of the vested option will be ‘banked’ and will only become capable of exercise at the end of the full five-year
performance period, provided that the participant is still employed by the Company at that time.
Subject to the provisions applying on cessation of employment and on a change of control, options may be exercised at any time up until the day before
the tenth anniversary of their grant date (or such earlier date as the Committee may determine).
Leaving Employment
General provisions
As a general rule, an option (whether or not it is already exercisable) will lapse upon a participant ceasing to be employed by the Company or ceasing to
be an Executive Director of the Company.
Good leavers (other than death) more than one year after the start of the performance period
However, if a participant ceases to be an employee or an Executive Director because of his ill health, injury, disability, the sale of his employing business or
company out of the Company’s Group or, in the case of HMRC-approved options granted under Part A of the LTIP, retirement or redundancy or in other
circumstances at the discretion of the Committee more than one year after the start of the performance period, the following provisions will apply:
(i) any part of an option which is already exercisable will remain so for a period of 12 months;
(ii) any part of an option which has already been ‘banked’ following the satisfaction of the performance conditions after three years, will become
exercisable (for a period of 12 months) at the normal time (at the end of the five year performance period) but will be subject to scaling back by
the factor of X/5 (where X is the number of years or part-years from 8 March 2010 to the date of cessation), unless the Committee decides that
scaling back is inappropriate in the particular circumstances (in which case it may reduce the scaling back as it considers appropriate including not
imposing any scaling back; and
132
Appendix One — Summary of the Principal Terms of the Luminar

Group Holdings 2010 Long-Term Incentive Plan (the “Ltip”)
(continued)
(iii) any part of an option which has not yet vested in accordance with the performance conditions will continue and the performance conditions will be
measured at the normal time(s) (i.e. after three years and five years, as applicable). However, the proportion of the option which vests will be scaled
back by the factor of X/5 (where X is the number of years or part-years from 8 March 2010 to the date of cessation), unless the Committee decides
that scaling back is inappropriate in the particular circumstances (in which case it may reduce the scaling back as it considers appropriate including
not imposing any scaling back). The normal vesting rules (where 50% of any part of the option that vests after three years cannot be exercised
until the end of the five-year performance period) will continue to apply. The option may then be exercised, to the extent vested, for a period of 12
months after it becomes exercisable.
Death more than one year after the start of the performance period
If a participant ceases employment by reason of death more than one year after the start of the performance period, the following provisions will apply:
(i) any part of an option which is already exercisable, will remain so for a period of 12 months following death;
(ii) any part of an option which has already been ‘banked’ (but is not yet exercisable) following the assessment of the performance conditions after
three years, will become exercisable (for a period of 12 months) at the time of death but will be subject to scaling back by the factor of X/5
(where X is the number of years or part-years from 8 March 2010 to the date of death), unless the Committee decides that scaling back for time is
inappropriate in the particular circumstances (in which case it may reduce the scaling back as it considers appropriate including not imposing any
scaling-back); and
(iii) any part of an option which has not yet vested in accordance with the performance conditions will do so at the time of death, subject to the
satisfaction of the performance conditions at that time and scaling back by the factor of X/5 (where X is the number of years or part-years from
8 March 2010 to the date of death) unless the Committee decides that scaling back is inappropriate in the particular circumstances (in which case
it may reduce the scaling back as it considers appropriate including not imposing any scaling back). The option may then be exercised, to the extent
vested, within a period of 12 months thereafter.
In determining to what extent the performance conditions have been met under (iii) above, the Committee may take into the account the extent to
which, in its opinion, the performance conditions would have been met had the five-year performance period run its full course.
Corporate Events
In the event of a takeover or winding-up of the Company (not being an internal corporate reorganisation) the following provisions will apply:
(i) any part of an option which is already exercisable, will remain so for a short period following the corporate event;
(ii) any part of an option which has already been ‘banked’ (but is not yet exercisable) following the assessment of the performance conditions after
three years will become exercisable (for a short period) at the time of the corporate event but will be subject to scaling back by the factor of X/5
(where X is the number of years or part-years from 8 March 2010 to the date of the corporate event), unless the Committee decides that scaling
back is inappropriate in the particular circumstances (in which case it may reduce the scaling back as it considers appropriate including not
imposing any scaling back); and
(iii) any part of an option which has not yet vested in accordance with the performance conditions will do so at the time of the corporate event, subject
to the satisfaction of the performance conditions at that time and scaling back by the factor of X/5 (where X is the number of years or part-years
from 8 March 2010 to the date of the corporate event) unless the Committee decides that scaling back for time is inappropriate in the particular
circumstances (in which case it may reduce the scaling back as it considers appropriate including not imposing any scaling back). The option may
then be exercised, to the extent vested, within a short period thereafter.
In determining to what extent the performance conditions have been met under (iii) above, the Committee may take into the account the extent to
which, in its opinion, the performance conditions would have been met had the relevant five-year performance period run its full course.
In the event of an internal corporate reorganisation where a new holding company is inserted above the Company, options will not become exercisable
(in the case of HMRC-approved options granted under Part A of the Plan, with the agreement of the participant) will be replaced by equivalent new
options over shares in the new holding company.
If a demerger, special dividend or other similar event is proposed which, in the opinion of the Committee, would affect the market price of Shares to
a material extent, then following consultation with shareholders, the Committee may decide that options will become exercisable on the basis which
would apply in the case of a takeover as described above.
133
Business Review
Governance
Participants’ Rights
Options will not confer any Shareholder rights until they have been exercised and the participants have received their Shares.
Rights Attaching to Shares

Any Shares allotted when an option is exercised will rank equally with Shares then in issue (except for rights arising by reference to a record date prior to
their allotment).
Variation of Capital
In the event of any variation in the Company’s share capital, the Committee may make such adjustment as it considers appropriate to the total number
of Shares available under the Plan, the number of Shares under option and the price payable on the exercise of an option. However, no adjustment may
be made to a tax-advantaged option granted under Part A of the LTIP without the prior approval of HMRC.
The total number of Shares available under the Plan, and Options granted under Part B of the LTIP which are not tax-advantaged may also be adjusted in
the event of a demerger, special dividend or other similar event which materially affects the market price of Shares.
Alterations to the LTIP

The Committee may, at any time, amend the LTIP in any respect, provided that the prior approval of Shareholders is obtained for any amendments that
are to the advantage of participants in respect of the rules governing eligibility, limits on participation, the overall limit on the number of Shares that may
be used under the Plan, the basis for determining a participant’s entitlement to, and the terms of, the Shares or cash to be acquired and the adjustment of
options.
The requirement to obtain the prior approval of Shareholders will not, however, apply to any minor alteration made to benefit the administration of the
LTIP, to take account of a change in legislation or to obtain or maintain favourable tax, exchange control or regulatory treatment for participants or for
any company in the Company’s Group.
No alteration to a key feature of Part A of the LTIP may be made without the approval of HMRC.
134
Appendix Two — Summary of the Principal Changes

to the Company’s Articles of Association
1. The Company’s Objects

The provisions regulating the operations of the Company are set out in the Company’s memorandum and articles of association. The Company’s
memorandum contains, amongst other things, the objects clause which sets out the scope of activities that the Company can undertake.
The Companies Act 2006 (the “Act”) significantly reduces the importance of the Company’s memorandum of association. The Act provides that the
memorandum need only record the names of the subscribers and the number of shares that each subscriber has agreed to take in the Company.
Under the Act, the objects clause and all other provisions which are contained in the Company’s memorandum, for existing companies at 1 October
2009, are deemed to be contained in the Company’s articles of association but the Company can remove these by special resolution.
Further, the Act states that unless the articles provide otherwise, a Company’s objects will be unrestricted. This abolishes the need for companies to
have an objects clause. For this reason, the Company is proposing to remove its objects clause together with all other provisions of its memorandum
which, by virtue of the Act, are treated as forming part of the Company’s articles of association. Resolution 15(a) confirms the removal of these
provisions.
2. Companies Act 1985

Provisions in the Current Articles that relate or refer to the Companies Act 1985 have been amended to bring them into line with the Act.
3. Authorised Share Capital

The Act abolishes the requirement for a company to have an authorised share capital. The adoption of the New Articles by the Company will have
the effect of removing this provision relating to the maximum number of shares that may be allotted by the Company. The Directors will be limited
as to the number of shares they can at any time allot, as Shareholder authority will still be required to authorise the Directors to allot shares.
4. Redeemable Shares
Prior to the Act coming into force, if a company wished to issue redeemable shares, it had to include, in its articles, the terms and manner in which
the shares could be redeemed. The Act now enables Directors to determine such matters as long as the articles give them to ability to do so. The
New Articles contain such authorisation.
5. Authority to purchase own shares

Under the Companies Act 1985, a company required specific authorisations in its articles (in addition to Shareholder approval) to purchase its own
shares. Under the Act, public companies no longer require specific authorisations in their articles to undertake these actions (although Shareholder
approval is still required), so these provisions have not been included in the New Articles.
6. Adjournment for lack of quorum

Under the Act as amended by the Companies (Shareholders’ Rights) Regulations 2009 (“Shareholders‘ Rights Regulations”), general meetings
adjourned for lack of quorum must be held at least 10 clear days after the original meeting, The New Articles include this requirement.
7. Chairman’s Casting Vote

The New Articles remove the provision that gives the chairman a casting vote in the event of equality of voting as this is no longer permitted under
the Act.
135
Business Review
Governance
8. Voting by proxies on a show of hands

The Act, as amended, by the Shareholders’ Right Regulations, provides that any proxy appointed by a member has one vote on a show of hands
unless the proxy is appointed by more than one member in which case the proxy has one vote for and one vote against if the proxy has been
instructed by one or more members to vote for the resolution and one or more to vote against the resolution. The New Articles reflect these
changes.
9. Use of Seals
Under the Companies Act 1985, a company had to have authority in its articles to have an official seal for use abroad. The New Articles provide an
alternative for execution of documents (other than for share certificates).
10. Deferred Shares

The Current Articles contain provisions setting out the rights and restrictions attaching to certain deferred shares in the capital of the Company. All
of these deferred shares were cancelled on 30 April 2010 and so the relevant provisions have been deleted in the New Articles.
11. Proxy Notices

The Current Articles state that any appointment of proxy has to be delivered no later that 48 hours prior to the relevant meeting being held. This 48
hour deadline was inclusive of weekend and bank holidays. Section 327(3) of the Act, however, implements a provision that now excludes any non-
working day from the calculation of this time limit. The New Articles reflect this change.
12. Voting record date

In accordance with the provisions of the Shareholders’ Rights Regulations, the New Articles clarify that in determining which persons are allowed to
attend or vote at a general meeting of the Company and how many votes each person may cast, the Company may specify a time which may not be
more than 48 hours before the time of the meeting (excluding any part of a day that is not a working day) by which a person must be entered on the
register of members in order to have the right to attend or vote at the meeting.
13. Voting by Corporate Representatives

The Act, as amended by the Shareholders’ Rights Regulations, enables multiple representatives appointed by the same corporate member to vote in
different ways on a show of hands and on a vote. The New Articles rely on the enabling provisions which are contained in the Act.
14. Electronic conduct of meetings

Amendments made to the Act by the Shareholders’ Rights Regulations specifically provide for the holding and conducting of electronic meetings.
The New Articles reflect more closely the relevant provisions.
15. General
Generally the opportunity has been taken to bring clearer language into the New Articles and therefore a number of non-material changes and
stylistic amendments have also been made to the Current Articles.
136
Annual General Meeting Company Secretary and

13 July 2010, 1.00 pm at the Registered Office of Registered Office
Luminar Group Holdings plc located at Luminar Tim O’Gorman
House, Deltic Avenue, Rooksley, Milton Keynes, Luminar House
Buckinghamshire, MK13 8LW Deltic Avenue
Rooksley
Timetable for Results Milton Keynes
For the year ending 25 February 2011 Bucks
MK13 8LW
Interim Management Statement circulated
Telephone 01908 544100
— 13 July 2010
Facsimile 01908 203596
Interim Results announced and Interim Statement
circulated — 21 October 2010
Registration
Interim Management Statement circulated
Luminar Group Holdings plc is registered in
— 13 January 2011*
England and Wales (no. 6239034)
Preliminary announcement of full year results
— May 2011* Registrars
Annual Report circulated — June 2011* Capita Registrars
Northern House
Dividend Payments
Woodsome Park
If any dividends are declared for the year ended
Fenay Bridge
25 February 2011, the expected payment dates would
Huddersfield
be:
West Yorkshire
Interim Dividend — January 2010*
HD8 0GA
Final Dividend — July 2010*
StockbrokerS
Shareholder Services
Numis Securities Limited
On the Group’s behalf, Natwest Stockbrokers Limited
10 Paternoster Square
operates a low cost share dealing service in Luminar
London
Group Holdings plc shares. Details are available on
EC4M 7LT
telephone 0870 6002050 or email on Contactees@
natwest.com quoting reference: Luminar plc.
Altium Capital Limited
30 St James’s Square
Private shareholders
London
If you have a query about your holding of Luminar
SW1Y 4AL
Group Holdings plc shares or need to change your
details, for example your address or payment of
Auditors
dividend requirements, please contact the registrars at
PricewaterhouseCoopers LLP
the address shown below.
10 Bricket Road
St Albans
Website
Hertfordshire
Further details of the Group’s activities and products
AL1 3JX
can be found on its website at www.luminar.co.uk.
Solicitors
CMS Cameron McKenna LLP
Mitre House
160 Aldersgate Street
London
EC1A 4DD
* Provisional dates to be confirmed.

Creating Destination Entertainment Venues
Business Review
02 Performance Overview
04 Our Brands
06 Our Customers
08 Delivering our Strategy
10 Chairman’s Statement
12 Business Review
Governance

57 Consolidated Statement of Comprehensive
Income
60 Consolidated Statement of Changes
in Shareholders’ Equity
61 Principal Accounting Policies for the Consolidated
70 Notes to the Consolidated Financial
Statements

108 Principal Accounting Policies for the Company
126 Explanatory Notes to the Notice of
Annual General Meeting
129 Appendix One
134 Appendix Two
Luminar
Luminar Group Holdings plc Annual Report 2010

Leader
in late night
entertainment
Annual Report 2010
Stock Code: LMR
www.luminar.co.uk
Luminar House
Deltic Avenue
Rooksley
Milton Keynes
MK13 8LW

Luminar Annual Report 2010: Leader in Late Night Entertainment

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Luminar Group Holdings plc Annual Report 2010

Creating Destination Entertainment Venues

Consolidated Financial Statements

Company Financial Statements

“The best operational capability

The Group’s strategy remains clearly focused on

Luminar has the best venues and the best operational

Luminar venues welcome over 250,000 customers through

02 The room for retro classics,

03 “Play that funky music”, customers

At Luminar we aim to provide the highest levels

Profit before tax

Sales (per head)

2008 2009 2010 2008 2009 2010 Cash Inflow

Net cash inflow

54.1 54.3 141.8

2008 2009 2010 2008 2009 2010

Luminar trades 87 of the largest nightclubs in

Group Revenue by Brand

02 State-of-the-art lighting at Liquid,

03 VIP bar Oceana, Swansea.

01 02 04 Liquid & Envy, Basildon.

Escape to the multi-award-winning Oceana and let us take you on a journey

The UK’s leading nightclub brand combines state-of-the-art lighting, sound

The classic two-room format — easily adaptable to meet a wide variety of

Luminar continues to offer real value

02 Enjoy a night with friends, book a

03 Dancing the night away.

30+ years Under 18 years

Satisfaction survey results (based on 973 visits)

Delivering Our Strategy

Luminar aims to remain the number one provider

We are fully aware that we are competing with other

Our plans for 2010

Significant cost reduction is under way, and is Summary

The key opportunities lie in being better at what we

02 Let our bartenders quench your thirst.

03 New York Disco.

Business Review (continued)

02 Inspiring surroundings at Head Office,

Business Review (continued)

Uncertainties clubs under short leaseholds, which are subject to

Graduates from How we invest in our people

156 2009/10 continued the previous year’s

Business Review (continued)

† Includes clubs disposed of during the year

02 State-of-the-art lighting rig.

03 DJ at work, pleasing the crowd.

Business Review (continued)

2010 compared with a covenant maximum of 3.0×. In Currency risk

Corporate Social Responsibility

02 DJ spinning some tunes.

03 Creating safer clubs.

Corporate Social Responsibility (continued)

CSR AND OUR CUSTOMERS’ EXPERIENCE Customer Security

Corporate Social Responsibility (continued)

We also note the recent establishment of the

Binge drinking and responsible retailing The Next Generation

Corporate Social Responsibility (continued)

Our People Following on from 110 graduates last year, we had

More recently, during the year a total of £341,878