REGISTERED NUMBER: 11053932 (England and Wales) |
GROUP STRATEGIC REPORT, |
REPORT OF THE DIRECTOR AND |
CONSOLIDATED FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
FOR |
RAIL OP HOLDINGS LIMITED |
REGISTERED NUMBER: 11053932 (England and Wales) |
GROUP STRATEGIC REPORT, |
REPORT OF THE DIRECTOR AND |
CONSOLIDATED FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
FOR |
RAIL OP HOLDINGS LIMITED |
RAIL OP HOLDINGS LIMITED (REGISTERED NUMBER: 11053932) |
CONTENTS OF THE CONSOLIDATED FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
Page |
Company Information | 1 |
Group Strategic Report | 2 |
Report of the Director | 3 |
Report of the Independent Auditors | 4 |
Consolidated Income Statement | 8 |
Consolidated Other Comprehensive Income | 9 |
Consolidated Balance Sheet | 10 |
Company Balance Sheet | 11 |
Consolidated Statement of Changes in Equity | 12 |
Company Statement of Changes in Equity | 13 |
Consolidated Cash Flow Statement | 14 |
Notes to the Consolidated Cash Flow Statement | 15 |
Notes to the Consolidated Financial Statements | 16 |
RAIL OP HOLDINGS LIMITED |
COMPANY INFORMATION |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
DIRECTOR: |
REGISTERED OFFICE: |
REGISTERED NUMBER: |
SENIOR STATUTORY AUDITOR: | Steven Collins |
AUDITORS: |
Statutory Auditor |
Chartered Certified Accountants |
Dickens House |
Guithavon Street |
Witham |
Essex |
CM8 1BJ |
BANKERS: | HSBC Bank PLC |
Midland House |
26 North Station Road |
COLCHESTER |
Essex |
CO1 1SY |
RAIL OP HOLDINGS LIMITED (REGISTERED NUMBER: 11053932) |
GROUP STRATEGIC REPORT |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
The director presents his strategic report of the company and the group for the year ended 31 December 2021. |
REVIEW OF BUSINESS |
The Directors are satisfied with the state of affairs of the Group as reflected in the balance sheet. |
The Group's principal activities are primarily the provision of electrification services to the rail industry, together with on track plant hire, highly skilled safety critical support staff and all grades of Civils staff. |
The Group had no cease in operations in 2021 because of the COVID pandemic and there was minimal impact financially. The UK economy was again affected by uncertainty due to Brexit, COVID, and now the war in Ukraine, but we still expect the government to prioritise funding to Network Rail so it can achieve its zero-carbon emission strategy by the 2050 target. |
Despite these extraordinary circumstances the Group has still been able to post strong operating profits of £2.9m for the year, contributing to a 25.87% increase in shareholders' funds at the balance sheet date. This has been achieved by the Group securing work in its familiar core markets and concentrating on opportunities for repeat business. Low turnover of our highly skilled personnel has been key to our success. Retention and training of excellent, highly qualified staff is essential to the business. A high percentage of our personnel have been with us for over 5 years. |
The key financial and other performance indicators during the year are as follows: |
2021 | 2020 |
£ 's | £ 's | % |
Turnover | £11,388 | £11,528 | -1.21% |
Operating Profit | £2,969 | £2,585 | +14.85% |
Profit after Tax | £2,398 | £2,040 | +17.55% |
Equity Shareholders' Funds | £9,356 | £7,433 | +25.87% |
Current Assets as % of Current Liabilities |
850% |
570% |
+49.12% |
PRINCIPAL RISKS AND UNCERTAINTIES |
The Group has a satisfactory level of workload and has demonstrated a good level of ability with all its key customers. The Group's strategy is directed at reducing risk and building a sustainable and profitable business with predictable income streams and increasing margins. The Directors believe that the Group's reputation and experience will enable it to secure a substantial volume of repeat business and gain selection for major projects. |
Credit risk is minimised by dealing only with reputable and established businesses and establishing good communication from the outset, so any credit issues are dealt with promptly. |
Overhead budgets continue to be monitored closely by the Directors together with ensuring that sufficient liquidity is available to meet foreseeable needs. |
Staffing resources have been established to allow for continued growth and staff training is continually ongoing to maintain a highly multi-skilled workforce. |
A healthy and safe working environment for the Group's staff and contractors is an essential part of its risk management strategy. The Group is continually reviewing and investing to ensure that risks in this area are minimised and controlled. |
ON BEHALF OF THE BOARD: |
RAIL OP HOLDINGS LIMITED (REGISTERED NUMBER: 11053932) |
REPORT OF THE DIRECTOR |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
The director presents his report with the financial statements of the company and the group for the year ended 31 December 2021. |
DIVIDENDS |
The total distribution of dividends for the year ended 31 December 2021 will be £ 475,000 . |
DIRECTOR |
STATEMENT OF DIRECTOR'S RESPONSIBILITIES |
The director is responsible for preparing the Group Strategic Report, the Report of the Director and the financial statements in accordance with applicable law and regulations. |
Company law requires the director to prepare financial statements for each financial year. Under that law the director has elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the director must not approve the financial statements unless he is satisfied that they give a true and fair view of the state of affairs of the company and the group and of the profit or loss of the group for that period. In preparing these financial statements, the director is required to: |
- | select suitable accounting policies and then apply them consistently; |
- | make judgements and accounting estimates that are reasonable and prudent; |
- | prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business. |
The director is responsible for keeping adequate accounting records that are sufficient to show and explain the company's and the group's transactions and disclose with reasonable accuracy at any time the financial position of the company and the group and enable him to ensure that the financial statements comply with the Companies Act 2006. He is also responsible for safeguarding the assets of the company and the group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. |
STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS |
So far as the director is aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the group's auditors are unaware, and he has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the group's auditors are aware of that information. |
AUDITORS |
The auditors, Baverstocks Limited, will be proposed for re-appointment at the forthcoming Annual General Meeting. |
ON BEHALF OF THE BOARD: |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
RAIL OP HOLDINGS LIMITED |
Opinion |
We have audited the financial statements of Rail Op Holdings Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2021 which comprise the Consolidated Income Statement, Consolidated Other Comprehensive Income, Consolidated Balance Sheet, Company Balance Sheet, Consolidated Statement of Changes in Equity, Company Statement of Changes in Equity, Consolidated Cash Flow Statement and Notes to the Consolidated Cash Flow Statement, Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice). |
In our opinion the financial statements: |
- | give a true and fair view of the state of the group's and of the parent company affairs as at 31 December 2021 and of the group's profit for the year then ended; |
- | 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. |
Basis for opinion |
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. |
Conclusions relating to going concern |
In auditing the financial statements, we have concluded that the director's use of the going concern basis of accounting in the preparation of the financial statements is appropriate. |
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the group's and the parent company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue. |
Our responsibilities and the responsibilities of the director with respect to going concern are described in the relevant sections of this report. |
Other information |
The director is responsible for the other information. The other information comprises the information in the Group Strategic Report and the Report of the Director, but does not include the financial statements and our Report of the Auditors thereon. |
Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. |
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. |
Opinions on other matters prescribed by the Companies Act 2006 |
In our opinion, based on the work undertaken in the course of the audit: |
- | the information given in the Group Strategic Report and the Report of the Director for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
- | the Group Strategic Report and the Report of the Director have been prepared in accordance with applicable legal requirements. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
RAIL OP HOLDINGS LIMITED |
Matters on which we are required to report by exception |
In the light of the knowledge and understanding of the group and the parent company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group Strategic Report or the Report of the Director. |
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 are not in agreement with the accounting records and returns; or |
- | certain disclosures of director's remuneration specified by law are not made; or |
- | we have not received all the information and explanations we require for our audit. |
Responsibilities of director |
As explained more fully in the Statement of Director's Responsibilities set out on page three, the director is responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the director determines necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. |
In preparing the financial statements, the director is responsible for assessing the group's and the parent company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the director either intends to liquidate the group or the parent company or to cease operations, or has no realistic alternative but to do so. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
RAIL OP HOLDINGS LIMITED |
Auditors' responsibilities for the audit of the financial statements |
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue a Report of the Auditors that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. |
The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below: |
Our approach to assessing the risks of material misstatement due to fraud and noncompliance with laws and regulations was as follows:- |
We obtained an understanding of the legal and regulatory frameworks that are applicable to the entity and determined that the most significant are those that relate to compliance with the Companies Act 2006, Financial Reporting Standard 102, relevant tax legislation, the Railway Industry Supplier Qualification Scheme (RISQS) and the Fleet Operator Recognition Scheme (FORS). |
We assessed the risks of material misstatements in respect of fraud and determined that the principal risks were related to posting of journal entries to manipulate the results for the financial year. We made enquiries of management during the audit to determine any instances of fraud, while also discussing the areas of risk in relation to audit as part of our audit team meeting. |
Based upon the results of our risk assessment we designed our audit procedures to identify noncompliance with such laws and regulations identified above and also material misstatements in respect of fraud as follows:- |
- | We obtained an understanding of the legal and regulatory framework in relation to the entity and how it complies with this framework. This included discussions with management, reviews of legal and professional fees and a review of the results of audits conducted by RISQS and FORS. |
- |
We discussed with the management the entity's policies and procedures including systems and controls. Compliance with these was tested via discussion and walkthrough testing of controls. |
- |
We enquired of management of their policies and procedures in relation to fraud and their knowledge of any actual, suspected, or alleged fraud. |
- |
We ensured compliance with Pay as You Earn and Value Added Tax laws via reviewing returns and correspondence. |
- | We reviewed the recent results of audits with RISQS to ensure ongoing compliance. |
- |
We considered the risk of fraud through management override, and, in response, we incorporated testing of manual journal entries into our audit approach. This included the testing of journal entries throughout the year as well as year end journals. |
- | We agreed the financial statement disclosures to underlying supporting documentation. |
- | We enquired of management if there were any potential litigation or claims. |
Whilst considering how our audit work addressed the detection of irregularities, we also consider the likelihood of detection based on our approach. Irregularities from fraud are inherently more difficult to detect than those arising from error. |
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation. |
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
RAIL OP HOLDINGS LIMITED |
Use of our report |
This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in a Report of the Auditors and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed. |
for and on behalf of |
Statutory Auditor |
Chartered Certified Accountants |
Dickens House |
Guithavon Street |
Witham |
Essex |
CM8 1BJ |
RAIL OP HOLDINGS LIMITED (REGISTERED NUMBER: 11053932) |
CONSOLIDATED INCOME STATEMENT |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
2021 | 2020 |
Notes | £ | £ |
TURNOVER | 3 | 11,388,003 | 11,527,872 |
Cost of sales | 7,404,826 | 7,546,544 |
GROSS PROFIT | 3,983,177 | 3,981,328 |
Administrative expenses | 1,014,609 | 1,420,712 |
2,968,568 | 2,560,616 |
Other operating income | 4 | - | 24,867 |
OPERATING PROFIT | 6 | 2,968,568 | 2,585,483 |
Interest receivable and similar income | - | 2,818 |
2,968,568 | 2,588,301 |
Interest payable and similar expenses | 7 | 4,486 | 11,850 |
PROFIT BEFORE TAXATION | 2,964,082 | 2,576,451 |
Tax on profit | 8 | 565,681 | 536,295 |
PROFIT FOR THE FINANCIAL YEAR |
Profit attributable to: |
Owners of the parent | 2,398,401 | 2,040,156 |
RAIL OP HOLDINGS LIMITED (REGISTERED NUMBER: 11053932) |
CONSOLIDATED OTHER COMPREHENSIVE INCOME |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
2021 | 2020 |
Notes | £ | £ |
PROFIT FOR THE YEAR | 2,398,401 | 2,040,156 |
OTHER COMPREHENSIVE INCOME | - | - |
TOTAL COMPREHENSIVE INCOME FOR THE YEAR |
2,398,401 |
2,040,156 |
Total comprehensive income attributable to: |
Owners of the parent | 2,398,401 | 2,040,156 |
RAIL OP HOLDINGS LIMITED (REGISTERED NUMBER: 11053932) |
CONSOLIDATED BALANCE SHEET |
31 DECEMBER 2021 |
2021 | 2020 |
Notes | £ | £ | £ | £ |
FIXED ASSETS |
Intangible assets | 11 | - | - |
Tangible assets | 12 | 1,000,122 | 904,147 |
Investments | 13 | - | - |
1,000,122 | 904,147 |
CURRENT ASSETS |
Debtors | 14 | 1,571,769 | 1,793,268 |
Cash at bank and in hand | 8,010,083 | 6,193,812 |
9,581,852 | 7,987,080 |
CREDITORS |
Amounts falling due within one year | 15 | 1,127,206 | 1,400,319 |
NET CURRENT ASSETS | 8,454,646 | 6,586,761 |
TOTAL ASSETS LESS CURRENT LIABILITIES |
9,454,768 |
7,490,908 |
CREDITORS |
Amounts falling due after more than one year |
16 |
- |
(25,472 |
) |
PROVISIONS FOR LIABILITIES | 19 | (98,347 | ) | (32,416 | ) |
NET ASSETS | 9,356,421 | 7,433,020 |
CAPITAL AND RESERVES |
Called up share capital | 20 | 153 | 153 |
Retained earnings | 21 | 9,356,268 | 7,432,867 |
SHAREHOLDERS' FUNDS | 9,356,421 | 7,433,020 |
The financial statements were approved by the director and authorised for issue on 17 August 2022 and were signed by: |
M A Gilbert - Director |
RAIL OP HOLDINGS LIMITED (REGISTERED NUMBER: 11053932) |
COMPANY BALANCE SHEET |
31 DECEMBER 2021 |
2021 | 2020 |
Notes | £ | £ | £ | £ |
FIXED ASSETS |
Intangible assets | 11 |
Tangible assets | 12 |
Investments | 13 |
CURRENT ASSETS |
Debtors | 14 |
Cash at bank |
CREDITORS |
Amounts falling due within one year | 15 |
NET CURRENT ASSETS/(LIABILITIES) | ( |
) |
TOTAL ASSETS LESS CURRENT LIABILITIES |
CREDITORS |
Amounts falling due after more than one year |
16 |
( |
) |
PROVISIONS FOR LIABILITIES | 19 | ( |
) | ( |
) |
NET ASSETS |
CAPITAL AND RESERVES |
Called up share capital | 20 |
Retained earnings | 21 |
SHAREHOLDERS' FUNDS |
Company's profit for the financial year | 1,177,757 | 2,260,622 |
The financial statements were approved by the director and authorised for issue on |
RAIL OP HOLDINGS LIMITED (REGISTERED NUMBER: 11053932) |
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
Called up |
share | Retained | Merger | Total |
capital | earnings | reserve | equity |
£ | £ | £ | £ |
Balance at 1 January 2020 | 153 | 7,463,190 | 172,471 | 7,635,814 |
Changes in equity |
Dividends | - | (2,242,950 | ) | - | (2,242,950 | ) |
Total comprehensive income | - | 2,040,156 | - | 2,040,156 |
Transfer between reserves | - | 172,471 | (172,471 | ) | - |
Balance at 31 December 2020 | 153 | 7,432,867 | - | 7,433,020 |
Changes in equity |
Dividends | - | (475,000 | ) | - | (475,000 | ) |
Total comprehensive income | - | 2,398,401 | - | 2,398,401 |
Balance at 31 December 2021 | 153 | 9,356,268 | - | 9,356,421 |
RAIL OP HOLDINGS LIMITED (REGISTERED NUMBER: 11053932) |
COMPANY STATEMENT OF CHANGES IN EQUITY |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
Called up |
share | Retained | Total |
capital | earnings | equity |
£ | £ | £ |
Balance at 1 January 2020 | ( |
) | ( |
) |
Changes in equity |
Dividends | - | ( |
) | ( |
) |
Total comprehensive income | - |
Balance at 31 December 2020 |
Changes in equity |
Dividends | - | ( |
) | ( |
) |
Total comprehensive income | - |
Balance at 31 December 2021 |
RAIL OP HOLDINGS LIMITED (REGISTERED NUMBER: 11053932) |
CONSOLIDATED CASH FLOW STATEMENT |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
2021 | 2020 |
Notes | £ | £ |
Cash flows from operating activities |
Cash generated from operations | 1 | 3,566,732 | 3,154,218 |
Interest element of hire purchase payments paid |
(4,486 |
) |
(11,850 |
) |
Tax paid | (669,138 | ) | (500,145 | ) |
Net cash from operating activities | 2,893,108 | 2,642,223 |
Cash flows from investing activities |
Purchase of tangible fixed assets | (504,854 | ) | (57,805 | ) |
Sale of tangible fixed assets | 17,500 | - |
Sale of investment property | - | 300,000 |
Interest received | - | 2,818 |
Net cash from investing activities | (487,354 | ) | 245,013 |
Cash flows from financing activities |
Capital repayments in year | (114,578 | ) | (150,611 | ) |
Amount introduced by directors | 475,000 | 3,520,950 |
Amount withdrawn by directors | (474,905 | ) | (2,259,222 | ) |
Equity dividends paid | (475,000 | ) | (2,242,950 | ) |
Net cash from financing activities | (589,483 | ) | (1,131,833 | ) |
Increase in cash and cash equivalents | 1,816,271 | 1,755,403 |
Cash and cash equivalents at beginning of year |
2 |
6,193,812 |
4,438,409 |
Cash and cash equivalents at end of year | 2 | 8,010,083 | 6,193,812 |
RAIL OP HOLDINGS LIMITED (REGISTERED NUMBER: 11053932) |
NOTES TO THE CONSOLIDATED CASH FLOW STATEMENT |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
1. | RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS |
2021 | 2020 |
£ | £ |
Profit before taxation | 2,964,082 | 2,576,451 |
Depreciation charges | 407,213 | 704,972 |
Profit on disposal of fixed assets | (15,833 | ) | - |
Finance costs | 4,486 | 11,850 |
Finance income | - | (2,818 | ) |
3,359,948 | 3,290,455 |
Decrease/(increase) in trade and other debtors | 238,724 | (6,936 | ) |
Decrease in trade and other creditors | (31,940 | ) | (129,301 | ) |
Cash generated from operations | 3,566,732 | 3,154,218 |
2. | CASH AND CASH EQUIVALENTS |
The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts: |
Year ended 31 December 2021 |
31.12.21 | 1.1.21 |
£ | £ |
Cash and cash equivalents | 8,010,083 | 6,193,812 |
Year ended 31 December 2020 |
31.12.20 | 1.1.20 |
£ | £ |
Cash and cash equivalents | 6,193,812 | 4,438,409 |
3. | ANALYSIS OF CHANGES IN NET FUNDS |
At 1.1.21 | Cash flow | At 31.12.21 |
£ | £ | £ |
Net cash |
Cash at bank and in hand | 6,193,812 | 1,816,271 | 8,010,083 |
6,193,812 | 1,816,271 | 8,010,083 |
Debt |
Finance leases | (140,050 | ) | 114,578 | (25,472 | ) |
(140,050 | ) | 114,578 | (25,472 | ) |
Total | 6,053,762 | 1,930,849 | 7,984,611 |
RAIL OP HOLDINGS LIMITED (REGISTERED NUMBER: 11053932) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
1. | STATUTORY INFORMATION |
Rail Op Holdings Limited is a |
The presentation currency of the financial statements is the Pound Sterling (£). |
2. | ACCOUNTING POLICIES |
Basis of preparing the financial statements |
Basis of consolidation |
The Group financial statements incorporate the financial statements of the Company and entities controlled by the Company (its subsidiaries) prepared to 31 December each year. Control is achieved where the Company is exposed to, or has the rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. In assessing control, the Group takes into consideration the existence and effect of potential voting rights that currently are exercisable or convertible. |
All subsidiary undertakings are owned 100% either directly or indirectly. |
Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by the Group. |
All intra-group transactions and balances and any unrealised gains and losses arising from intra-group transactions are eliminated in preparing the Consolidated Financial Statements |
Accounting for merger |
On 18th December 2019 the group acquired the share capital of Rail Op OHL Limited via a share for share exchange. The ultimate equity holders remained the same and the rights of each equity holder, relative to the others, was unchanged. |
In reviewing the scope of the merger and group formation, the directors have determined the selection of an accounting policy analogous to that of the UK's FRS102 section 19 Business Combinations and Goodwill (merger accounting method) will provide the most relevant, reliable and representative accounting treatment, |
which reflects the economic substance of the transaction. |
In applying merger accounting when preparing these Consolidated Financial Statements, to the extent the carrying value of the assets and liabilities acquired under merger accounting is different to the cost of investment, the difference is recorded in equity within the merger reserve. Under merger accounting the results of the Group entities are combined from the beginning of the comparative period before the merger occurred. Comparatives are restated on a combined basis and adjustments made as necessary to achieve consistency of accounting principles. |
Critical accounting judgements and key sources of estimation uncertainty |
Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. |
There are no estimates and assumptions that have a significant risk of causing material adjustment in the financial statements. |
RAIL OP HOLDINGS LIMITED (REGISTERED NUMBER: 11053932) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
2. | ACCOUNTING POLICIES - continued |
Turnover |
Turnover is measured at the fair value of the consideration received or receivable net of VAT and trade discounts. The policies adopted for the recognition of turnover are as follows: |
Rendering of services |
When the outcome of a transaction can be estimated reliably, turnover from the provision of electrification services to the rail industry and plant hire is recognised by reference to the stage of completion at the balance sheet date. Stage of completion is measured by reference to the date the supply of labour and plant hire was made. |
Where the outcome cannot be measured reliably, turnover is recognised only to the extent of the expenses recognised that are recoverable. |
Goodwill |
Intangible assets |
Intangible assets are initially measured at cost. After initial recognition, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses. |
Tangible fixed assets |
Improvements to Property | - |
Plant and Machinery | - |
Fixtures and Fittings | - |
Motor Vehicles | - |
Computer Equipment | - |
Investment property |
Investment property is shown at most recent valuation. Any aggregate surplus or deficit arising from changes in fair value is recognised in profit or loss. |
Taxation |
Taxation for the year comprises current and deferred tax. Tax is recognised in the Consolidated Income Statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. |
Current or deferred taxation assets and liabilities are not discounted. |
Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date. |
Deferred tax |
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date. |
Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference. |
Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. |
RAIL OP HOLDINGS LIMITED (REGISTERED NUMBER: 11053932) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
2. | ACCOUNTING POLICIES - continued |
Hire purchase and leasing commitments |
Assets obtained under hire purchase contracts or finance leases are capitalised in the balance sheet. Those held under hire purchase contracts are depreciated over their estimated useful lives. Those held under finance leases are depreciated over their estimated useful lives or the lease term, whichever is the shorter. |
The interest element of these obligations is charged to profit or loss over the relevant period. The capital element of the future payments is treated as a liability. |
Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the lease. |
Pension costs and other post-retirement benefits |
The group operates a defined contribution pension scheme. Contributions payable to the group's pension scheme are charged to profit or loss in the period to which they relate. |
Business combinations and goodwill |
The purchase method of accounting is used to account for the acquisition of subsidiaries by the Group. |
Goodwill represents the excess of the fair value of the purchase consideration for the subsidiary undertakings over the fair value of the identifiable assets, including any intangible assets identified, and the liabilities of a subsidiary at the date of acquisition. |
Goodwill arising on subsidiary acquisitions is capitalised and amortised over its useful economic life of 3 years on a straight line basis. |
3. | TURNOVER |
The turnover and profit before taxation are attributable to the one principal activity of the group. |
An analysis of turnover by class of business is given below: |
2021 | 2020 |
£ | £ |
Rendering of services | 11,388,003 | 11,527,872 |
11,388,003 | 11,527,872 |
4. | OTHER OPERATING INCOME |
2021 | 2020 |
£ | £ |
Rents Received | - | 7,665 |
Government Grants | - | 17,202 |
- | 24,867 |
5. | EMPLOYEES AND DIRECTORS |
2021 | 2020 |
£ | £ |
Wages and salaries | 367,876 | 327,671 |
Social security costs | 35,438 | 27,541 |
Other pension costs | 5,716 | 5,392 |
409,030 | 360,604 |
RAIL OP HOLDINGS LIMITED (REGISTERED NUMBER: 11053932) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
5. | EMPLOYEES AND DIRECTORS - continued |
The average number of employees during the year was as follows: |
2021 | 2020 |
Directors | 1 | 1 |
Administration | 6 | 6 |
Direct | 4 | 4 |
2021 | 2020 |
£ | £ |
Director's remuneration | 16,819 | 7,638 |
6. | OPERATING PROFIT |
The operating profit is stated after charging/(crediting): |
2021 | 2020 |
£ | £ |
Hire of Plant and Machinery | 19,924 | - |
Other Operating Leases | 12,000 | 12,000 |
Depreciation - owned assets | 297,051 | 351,807 |
Depreciation - assets on hire purchase contracts | 110,161 | 119,795 |
Profit on disposal of fixed assets | (15,833 | ) | - |
Goodwill amortisation | - | 233,370 |
Auditors Remuneration | 19,000 | 24,000 |
7. | INTEREST PAYABLE AND SIMILAR EXPENSES |
2021 | 2020 |
£ | £ |
Hire Purchase Interest | 4,416 | 11,556 |
HMRC Interest | 70 | 294 |
4,486 | 11,850 |
8. | TAXATION |
Analysis of the tax charge |
The tax charge on the profit for the year was as follows: |
2021 | 2020 |
£ | £ |
Current tax: |
UK corporation tax | 499,750 | 591,063 |
Deferred Taxation | 65,931 | (54,768 | ) |
Tax on profit | 565,681 | 536,295 |
RAIL OP HOLDINGS LIMITED (REGISTERED NUMBER: 11053932) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
8. | TAXATION - continued |
Reconciliation of total tax charge included in profit and loss |
The tax assessed for the year is higher than the standard rate of corporation tax in the UK. The difference is explained below: |
2021 | 2020 |
£ | £ |
Profit before tax | 2,964,082 | 2,576,451 |
Profit multiplied by the standard rate of corporation tax in the UK of 19 % (2020 - 19 %) |
563,176 |
489,526 |
Effects of: |
Expenses not deductible for tax purposes | 2,505 | 46,769 |
Total tax charge | 565,681 | 536,295 |
9. | INDIVIDUAL INCOME STATEMENT |
As permitted by Section 408 of the Companies Act 2006, the Income Statement of the parent company is not presented as part of these financial statements. |
10. | DIVIDENDS |
2021 | 2020 |
£ | £ |
Ordinary shares of £1.00 each |
Interim | 475,000 | 2,242,950 |
11. | INTANGIBLE FIXED ASSETS |
Group |
Goodwill |
£ |
COST |
At 1 January 2021 |
and 31 December 2021 | 816,821 |
AMORTISATION |
At 1 January 2021 |
and 31 December 2021 | 816,821 |
NET BOOK VALUE |
At 31 December 2021 | - |
At 31 December 2020 | - |
RAIL OP HOLDINGS LIMITED (REGISTERED NUMBER: 11053932) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
12. | TANGIBLE FIXED ASSETS |
Group |
Improvements | Fixtures |
to | Plant and | and |
Property | Machinery | Fittings |
£ | £ | £ |
COST |
At 1 January 2021 | 259,507 | 2,122,904 | 6,302 |
Additions | - | 268,460 | - |
Disposals | - | - | - |
At 31 December 2021 | 259,507 | 2,391,364 | 6,302 |
DEPRECIATION |
At 1 January 2021 | 75,636 | 1,514,510 | 5,415 |
Charge for year | 10,380 | 316,846 | 546 |
Eliminated on disposal | - | - | - |
At 31 December 2021 | 86,016 | 1,831,356 | 5,961 |
NET BOOK VALUE |
At 31 December 2021 | 173,491 | 560,008 | 341 |
At 31 December 2020 | 183,871 | 608,394 | 887 |
Motor | Computer |
Vehicles | Equipment | Totals |
£ | £ | £ |
COST |
At 1 January 2021 | 353,518 | 44,438 | 2,786,669 |
Additions | 233,519 | 2,875 | 504,854 |
Disposals | (58,065 | ) | (2,778 | ) | (60,843 | ) |
At 31 December 2021 | 528,972 | 44,535 | 3,230,680 |
DEPRECIATION |
At 1 January 2021 | 251,739 | 35,222 | 1,882,522 |
Charge for year | 74,187 | 5,253 | 407,212 |
Eliminated on disposal | (56,398 | ) | (2,778 | ) | (59,176 | ) |
At 31 December 2021 | 269,528 | 37,697 | 2,230,558 |
NET BOOK VALUE |
At 31 December 2021 | 259,444 | 6,838 | 1,000,122 |
At 31 December 2020 | 101,779 | 9,216 | 904,147 |
RAIL OP HOLDINGS LIMITED (REGISTERED NUMBER: 11053932) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
12. | TANGIBLE FIXED ASSETS - continued |
Group |
Fixed assets, included in the above, which are held under hire purchase contracts are as follows: |
Plant and | Motor |
Machinery | Vehicles | Totals |
£ | £ | £ |
COST |
At 1 January 2021 |
and 31 December 2021 | 534,750 | 51,380 | 586,130 |
DEPRECIATION |
At 1 January 2021 | 410,466 | 48,169 | 458,635 |
Charge for year | 106,950 | 3,211 | 110,161 |
At 31 December 2021 | 517,416 | 51,380 | 568,796 |
NET BOOK VALUE |
At 31 December 2021 | 17,334 | - | 17,334 |
At 31 December 2020 | 124,284 | 3,211 | 127,495 |
Company |
Plant and |
Machinery |
£ |
COST |
At 1 January 2021 |
Additions |
At 31 December 2021 |
DEPRECIATION |
At 1 January 2021 |
Charge for year |
At 31 December 2021 |
NET BOOK VALUE |
At 31 December 2021 |
At 31 December 2020 |
RAIL OP HOLDINGS LIMITED (REGISTERED NUMBER: 11053932) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
12. | TANGIBLE FIXED ASSETS - continued |
Company |
Fixed assets, included in the above, which are held under hire purchase contracts are as follows: |
Plant and |
Machinery |
£ |
COST |
At 1 January 2021 |
and 31 December 2021 |
DEPRECIATION |
At 1 January 2021 |
Charge for year |
At 31 December 2021 |
NET BOOK VALUE |
At 31 December 2021 |
At 31 December 2020 |
13. | FIXED ASSET INVESTMENTS |
Company |
Shares in |
Group |
Undertakings |
£ |
COST |
At 1 January 2021 |
and 31 December 2021 |
NET BOOK VALUE |
At 31 December 2021 |
At 31 December 2020 |
The group or the company's investments at the Balance Sheet date in the share capital of companies include the following: |
Subsidiaries |
Registered office: |
Nature of business: |
% |
Class of shares: | holding |
2021 | 2020 |
£ | £ |
Aggregate capital and reserves | ( |
) |
Loss for the year | ( |
) | ( |
) |
RAIL OP HOLDINGS LIMITED (REGISTERED NUMBER: 11053932) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
13. | FIXED ASSET INVESTMENTS - continued |
Registered office: |
Nature of business: |
% |
Class of shares: | holding |
2021 | 2020 |
£ | £ |
Aggregate capital and reserves |
Profit for the year |
14. | DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
Group | Company |
2021 | 2020 | 2021 | 2020 |
£ | £ | £ | £ |
Trade Debtors | 216,801 | 735,098 |
Amounts owed by group undertakings | - | - |
Other Debtors | 523,481 | 545,558 |
Net Wages in Advance | 12,962 | 6,542 | - | - |
Tax | 17,225 | - |
Prepayments and Accrued Income | 801,300 | 506,070 |
1,571,769 | 1,793,268 |
15. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
Group | Company |
2021 | 2020 | 2021 | 2020 |
£ | £ | £ | £ |
Hire purchase contracts (see note 17) | 25,472 | 114,578 |
Trade Creditors | 67,941 | 174,327 |
Amounts owed to group undertakings | - | - |
Corporation Tax | 216,769 | 368,932 |
Social Security and Other |
Taxes | 515,950 | 494,256 |
Other Creditors | 1,421 | 1,278 |
Directors Current Accounts | 143 | 48 | - | - |
Accruals and Deferred Income | 299,510 | 246,900 |
1,127,206 | 1,400,319 |
16. | CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR |
Group | Company |
2021 | 2020 | 2021 | 2020 |
£ | £ | £ | £ |
Hire purchase contracts (see note 17) | - | 25,472 |
RAIL OP HOLDINGS LIMITED (REGISTERED NUMBER: 11053932) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
17. | LEASING AGREEMENTS |
Minimum lease payments fall due as follows: |
Group |
Hire purchase contracts |
2021 | 2020 |
£ | £ |
Gross obligations repayable: |
Within one year | 25,714 | 118,994 |
Between one and five years | - | 25,714 |
25,714 | 144,708 |
Finance charges repayable: |
Within one year | 242 | 4,416 |
Between one and five years | - | 242 |
242 | 4,658 |
Net obligations repayable: |
Within one year | 25,472 | 114,578 |
Between one and five years | - | 25,472 |
25,472 | 140,050 |
Company |
Hire purchase contracts |
2021 | 2020 |
£ | £ |
Gross obligations repayable: |
Within one year |
Between one and five years |
Finance charges repayable: |
Within one year |
Between one and five years |
Net obligations repayable: |
Within one year |
Between one and five years |
RAIL OP HOLDINGS LIMITED (REGISTERED NUMBER: 11053932) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
18. | SECURED DEBTS |
The following secured debts are included within creditors: |
Group | Company |
2021 | 2020 | 2021 | 2020 |
£ | £ | £ | £ |
Hire purchase contracts | 25,472 | 140,050 | 22,038 | 126,763 |
The hire purchase debt is secured against the specific fixed asset purchased. |
19. | PROVISIONS FOR LIABILITIES |
Group | Company |
2021 | 2020 | 2021 | 2020 |
£ | £ | £ | £ |
Deferred Taxation - Capital |
Allowances | 98,347 | 32,416 | 36,822 | 11,494 |
98,347 | 32,416 | 36,822 | 11,494 |
Group |
Deferred |
tax |
£ |
Balance at 1 January 2021 | 32,416 |
Charge to Income Statement during year | 65,931 |
Balance at 31 December 2021 | 98,347 |
Company |
Deferred |
tax |
£ |
Balance at 1 January 2021 |
Charge to Income Statement during year |
Balance at 31 December 2021 |
20. | CALLED UP SHARE CAPITAL |
Allotted, issued and fully paid: |
Number: | Class: | Nominal | 2021 | 2020 |
value: | £ | £ |
Ordinary | £1.00 | 150 | 150 |
A | £1 | 1 | 1 |
B | £1 | 1 | 1 |
C | £1 | 1 | 1 |
153 | 153 |
RAIL OP HOLDINGS LIMITED (REGISTERED NUMBER: 11053932) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
21. | RESERVES |
Group |
Retained |
earnings |
£ |
At 1 January 2021 | 7,432,867 |
Profit for the year | 2,398,401 |
Dividends | (475,000 | ) |
At 31 December 2021 | 9,356,268 |
Company |
Retained |
earnings |
£ |
At 1 January 2021 |
Profit for the year |
Dividends | ( |
) |
At 31 December 2021 |
In accordance with section 612 of the Companies Act 2006, the premium on shares issued in relation to acquisitions is recorded as a merger reserve. |
22. | DIRECTOR'S ADVANCES, CREDITS AND GUARANTEES |
The following advances and credits to a director subsisted during the years ended 31 December 2021 and 31 December 2020: |
2021 | 2020 |
£ | £ |
M A Gilbert |
Balance outstanding at start of year | - | 1,261,680 |
Amounts advanced | 82,056 | 57,399 |
Amounts repaid | (82,056 | ) | (1,319,079 | ) |
Amounts written off | - | - |
Amounts waived | - | - |
Balance outstanding at end of year | - | - |
23. | RELATED PARTY DISCLOSURES |
During the year, a total of key management personnel compensation of £ 33,638 (2020 - £ 15,276 ) was paid. |
24. | ULTIMATE CONTROLLING PARTY |
The controlling party is M and K Gilbert. |