REGISTERED NUMBER: |
Group Tyre Wholesale Limited |
Strategic Report, Report of the Directors and |
Financial Statements |
for the Year Ended 31 December 2021 |
REGISTERED NUMBER: |
Group Tyre Wholesale Limited |
Strategic Report, Report of the Directors and |
Financial Statements |
for the Year Ended 31 December 2021 |
Group Tyre Wholesale Limited (Registered number: 07399286) |
Contents of the Financial Statements |
for the Year Ended 31 December 2021 |
Page |
Company Information | 1 |
Strategic Report | 2 |
Report of the Directors | 4 |
Report of the Independent Auditors | 5 |
Income Statement | 9 |
Other Comprehensive Income | 10 |
Statement of Financial Position | 11 |
Statement of Changes in Equity | 12 |
Statement of Cash Flows | 13 |
Notes to the Statement of Cash Flows | 14 |
Notes to the Financial Statements | 15 |
Group Tyre Wholesale Limited |
Company Information |
for the Year Ended 31 December 2021 |
DIRECTORS: |
REGISTERED OFFICE: |
REGISTERED NUMBER: |
AUDITORS: |
Chartered Accountants and Statutory Auditors |
Sterling House |
97 Lichfield Street |
Tamworth |
Staffordshire |
B79 7QF |
Group Tyre Wholesale Limited (Registered number: 07399286) |
Strategic Report |
for the Year Ended 31 December 2021 |
The directors present their strategic report for the year ended 31 December 2021. |
REVIEW OF BUSINESS |
We aim to present a balanced and comprehensive review of our business. Our review is consistent with the size and nature of our business and in the context of risks and uncertainties we face. |
Our key aim remains the delivery of great brands and unbeatable service levels, with our warehouses continuing to improve our corporate and environmental standards, service levels and overall efficiencies. |
For the second year running our overall result was impacted negatively by the Covid 19 pandemic. Chinese economy tyre prices have been affected by freight costs that spiralled throughout the year causing average delivered tyre costs, and sell-out prices, to increase exponentially. By the end of the year Chinese freight costs had plateaued. We anticipate freight costs to decrease in 2022, once normal supply and levels resume, and our primary focus remains to carry a complete balanced product portfolio ensuring that our offer at various pricing points is unsurpassed. |
Brexit did not impact the business as our suppliers had sufficient stocks and/or their goods flowed freely enough through European ports to support a somewhat depressed UK market with traffic flows around 90% of pre-pandemic levels. |
Overall, 2021's financial result shows a significant improvement in profitability of 61.4% over 2020 (£813,027 - PBT) which is no mean achievement given turnover increased by just 5.9% to £31,746,951. Our management team managed to increase gross margins by 0.2% whilst also reducing costs by 3.3%. |
Group Tyre Wholesale paid a dividend to its shareholders of £240,000 in 2021. |
Our staff are key to this performance and have enabled plans to be realised with hard work and skill in all parts of the business. This is pivotal to our success and great efforts will continually be made to improve staff, in training, effectiveness and improving our environment to enable their full potential to shine. |
Group Tyre Wholesale Limited (Registered number: 07399286) |
Strategic Report |
for the Year Ended 31 December 2021 |
PRINCIPAL RISKS AND UNCERTAINTIES |
Stock values were at a high as we entered 2022. It remains to be seen what impact Chinese freight prices will have on UK stock prices should freight prices return to, or even close to, pre-pandemic price levels. |
The impact of the pandemic and lockdowns in the UK and China, ongoing into 2022, are not yet fully understood whist the impact of the Russian invasion and war in Ukraine cannot even begin to be estimated, save to say, change could be significant in many ways but especially so with Worldwide raw material prices and energy prices increasing dramatically. Already we have seen significant shortages and price increases in European manufactured tyres, with those increases having to be absorbed by the consumer. |
The worldwide cost of living crisis is another uncertainty with most tyre purchases being a distress purchase then often the purchase is delayed but never eradicated. |
We intend to implement a new warehouse management system in 2022 which we hope will lead to significant improvements to our service offer whilst also reducing operating costs. It will also improve our environmental impact as we try to go paperless by the end of 2022. |
Whilst leaving the EU at the end of the 2020 could still create problems in the market in 2022, tyres are a world product and we are certain that because we are dealing in many parts of the world, any effect should continue to prove positive. |
In general the public still prefers the automobile as its choice of mobility so whether the car boasts an internal combustion engine, a hydrogen powered engine or is powered electrically, in some way they all need tyres. Whilst the Company stays smart, nimble and alert then the foreseeable future seems assured. |
ON BEHALF OF THE BOARD: |
Group Tyre Wholesale Limited (Registered number: 07399286) |
Report of the Directors |
for the Year Ended 31 December 2021 |
The directors present their report with the financial statements of the company for the year ended 31 December 2021. |
PRINCIPAL ACTIVITY |
The principal activity of the company in the year under review was that of the distribution of tyres to the automotive industry within London, the Home Counties and the immediate surrounding areas. |
DIVIDENDS |
An interim dividend of 24p per share was paid on 23 December 2021. The directors recommend that no final dividend be paid. |
The total distribution of dividends for the year ended 31 December 2021 will be £ |
DIRECTORS |
The directors shown below have held office during the whole of the period from 1 January 2021 to the date of this report. |
STATEMENT OF DIRECTORS' RESPONSIBILITIES |
The directors are responsible for preparing the Strategic Report, the Report of the Directors and the financial statements in accordance with applicable law and regulations. |
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law), including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are 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 directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company 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 directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and each director 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 company's auditors are aware of that information. |
AUDITORS |
The auditors, Haines Watts Tamworth 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 |
Group Tyre Wholesale Limited |
Opinion |
We have audited the financial statements of Group Tyre Wholesale Limited (the 'company') for the year ended 31 December 2021 which comprise the Income Statement, Other Comprehensive Income, Statement of Financial Position, Statement of Changes in Equity, Statement of Cash Flows and Notes to the Statement of Cash Flows, 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 company's affairs as at 31 December 2021 and of its 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 company 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 directors' 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 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 directors with respect to going concern are described in the relevant sections of this report. |
Other information |
The directors are responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Directors, 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 Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
- | the Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements. |
Report of the Independent Auditors to the Members of |
Group Tyre Wholesale Limited |
Matters on which we are required to report by exception |
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Report of the Directors. |
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, or returns adequate for our audit have not been received from branches not visited by us; or |
- | the financial statements are not in agreement with the accounting records and returns; or |
- | certain disclosures of directors' remuneration specified by law are not made; or |
- | we have not received all the information and explanations we require for our audit. |
Responsibilities of directors |
As explained more fully in the Statement of Directors' Responsibilities set out on page four, the directors are 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 directors determine 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 directors are responsible for assessing the 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 directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so. |
Report of the Independent Auditors to the Members of |
Group Tyre Wholesale 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: |
Identifying and assessing potential risks related to irregularities |
In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, we considered the following: |
- results of our enquiries of management about their own identification and assessment of the risks and irregularities |
- any matters we identified having obtained an understanding of the company policies and procedures relating to |
- identifying, evaluating and complying with laws and regulations and whether they are aware of any instances of non-compliance |
- detecting and responding to the risks of fraud and whether they have knowledge of any actual, suspected or alleged fraud |
- the internal controls set up to mitigate risks of fraud or non-compliance with laws and regulations |
- the matters discussed among the audit engagement team regarding how and where fraud might occur in the financial statements and any potential indicators of fraud. |
- obtaining an understanding of the legal and regulatory framework that the company operates in, focusing on those laws and regulations that had a direct effect on the financial statements, including UK Companies Act 2006, pensions and tax legislation |
- provisions of other laws and regulations that do not have a direct effect on the financial statements but compliance with which may be fundamental to the company's ability to operate or to avoid material penalty. These include the impact of import restrictions. |
As a result of performing the above, we did not identify any key audit matters related to the potential risk of fraud or non-compliance with laws and regulations. |
Audit response to risks identified |
Our procedures to respond to risks identified included the following: |
- reviewing the financial statement disclosures and testing to supporting documentation to assess compliance with provisions of relevant laws and regulations described as having a direct effect on the financial statements |
- enquiring of management concerning actual and potential legal action and claims |
- carrying out analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud |
- in addressing the risk of fraud through management override of controls, testing the appropriateness of journal entries and other adjustments; assessing whether the judgements made in making accounting estimates are indicative of a potential bias; and evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business. |
- considering performance targets and their influence on efforts made by management to manage earnings |
We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members and remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit. |
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 |
Group Tyre Wholesale 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 |
Chartered Accountants and Statutory Auditors |
Sterling House |
97 Lichfield Street |
Tamworth |
Staffordshire |
B79 7QF |
Group Tyre Wholesale Limited (Registered number: 07399286) |
Income Statement |
for the Year Ended 31 December 2021 |
2021 | 2020 |
Notes | £ | £ |
TURNOVER | 3 |
Cost of sales |
GROSS PROFIT |
Administrative expenses |
808,577 | 242,918 |
Other operating income |
OPERATING PROFIT | 5 |
Interest payable and similar expenses | 6 |
PROFIT BEFORE TAXATION |
Tax on profit | 7 |
PROFIT FOR THE FINANCIAL YEAR |
Group Tyre Wholesale Limited (Registered number: 07399286) |
Other Comprehensive Income |
for the Year Ended 31 December 2021 |
2021 | 2020 |
Notes | £ | £ |
PROFIT FOR THE YEAR |
OTHER COMPREHENSIVE INCOME | - | - |
TOTAL COMPREHENSIVE INCOME FOR THE YEAR |
Group Tyre Wholesale Limited (Registered number: 07399286) |
Statement of Financial Position |
31 December 2021 |
2021 | 2020 |
Notes | £ | £ | £ | £ |
FIXED ASSETS |
Tangible assets | 9 |
Investments | 10 |
CURRENT ASSETS |
Stocks | 11 |
Debtors | 12 |
CREDITORS |
Amounts falling due within one year | 13 |
NET CURRENT ASSETS |
TOTAL ASSETS LESS CURRENT LIABILITIES |
CREDITORS |
Amounts falling due after more than one year |
14 |
( |
) |
( |
) |
PROVISIONS FOR LIABILITIES | 18 | ( |
) | ( |
) |
NET ASSETS |
CAPITAL AND RESERVES |
Called up share capital | 19 |
Revaluation reserve | 20 |
Retained earnings | 20 |
SHAREHOLDERS' FUNDS |
The financial statements were approved by the Board of Directors and authorised for issue on |
Group Tyre Wholesale Limited (Registered number: 07399286) |
Statement of Changes in Equity |
for the Year Ended 31 December 2021 |
Called up |
share | Retained | Revaluation | Total |
capital | earnings | reserve | equity |
£ | £ | £ | £ |
Balance at 1 January 2020 |
Changes in equity |
Total comprehensive income | - |
Balance at 31 December 2020 |
Changes in equity |
Dividends | - | ( |
) | - | ( |
) |
Total comprehensive income | - |
Balance at 31 December 2021 |
Group Tyre Wholesale Limited (Registered number: 07399286) |
Statement of Cash Flows |
for the Year Ended 31 December 2021 |
2021 | 2020 |
Notes | £ | £ |
Cash flows from operating activities |
Cash generated from operations | 1 | ( |
) |
Interest paid | ( |
) | ( |
) |
Interest element of hire purchase payments paid |
( |
) |
( |
) |
Tax paid | ( |
) |
Net cash from operating activities | ( |
) |
Cash flows from investing activities |
Purchase of tangible fixed assets | ( |
) | ( |
) |
Sale of tangible fixed assets |
Net cash from investing activities | ( |
) |
Cash flows from financing activities |
New loans in year |
Loan repayments in year | ( |
) | ( |
) |
Related party balances | (243,474 | ) | (70,267 | ) |
Capital repayments in year | ( |
) | ( |
) |
Equity dividends paid | ( |
) |
Net cash from financing activities | ( |
) |
(Decrease)/increase in cash and cash equivalents | ( |
) |
Cash and cash equivalents at beginning of year |
2 |
(190,382 |
) |
(233,215 |
) |
Cash and cash equivalents at end of year | 2 | ( |
) | ( |
) |
Group Tyre Wholesale Limited (Registered number: 07399286) |
Notes to the Statement of Cash Flows |
for the Year Ended 31 December 2021 |
1. | RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS |
2021 | 2020 |
£ | £ |
Profit before taxation |
Depreciation charges |
Profit on disposal of fixed assets | ( |
) | ( |
) |
Finance costs | 52,644 | 59,601 |
1,003,655 | 732,040 |
(Increase)/decrease in stocks | ( |
) |
(Increase)/decrease in trade and other debtors | ( |
) |
Increase/(decrease) in trade and other creditors | ( |
) |
Cash generated from operations | ( |
) |
2. | CASH AND CASH EQUIVALENTS |
The amounts disclosed on the Statement of Cash Flows in respect of cash and cash equivalents are in respect of these Statement of Financial Position amounts: |
Year ended 31 December 2021 |
31.12.21 | 1.1.21 |
£ | £ |
Bank overdrafts | ( |
) | ( |
) |
Year ended 31 December 2020 |
31.12.20 | 1.1.20 |
£ | £ |
Bank overdrafts | ( |
) | ( |
) |
3. | ANALYSIS OF CHANGES IN NET DEBT |
At 1.1.21 | Cash flow | At 31.12.21 |
£ | £ | £ |
Net cash |
Bank overdrafts | (190,382 | ) | (30,975 | ) | (221,357 | ) |
(190,382 | ) | ( |
) | (221,357 | ) |
Debt |
Finance leases | (201,304 | ) | 201,304 | - |
Debts falling due within 1 year | (2,313,532 | ) | (1,047,723 | ) | (3,361,255 | ) |
Debts falling due after 1 year | (1,101,107 | ) | 273,252 | (827,855 | ) |
(3,615,943 | ) | (573,167 | ) | (4,189,110 | ) |
Total | (3,806,325 | ) | (604,142 | ) | (4,410,467 | ) |
Group Tyre Wholesale Limited (Registered number: 07399286) |
Notes to the Financial Statements |
for the Year Ended 31 December 2021 |
1. | STATUTORY INFORMATION |
Group Tyre Wholesale Limited is a |
2. | ACCOUNTING POLICIES |
Basis of preparing the financial statements |
The financial statements have been prepared on a going concern basis which assumes that the company will continue to operate for the foreseeable future. Budgets and cash flow projections compiled indicate the company has sufficient reserves to continue to trade and the directors believe that support afforded, careful cashflow considerations is sufficient upon which to adopt the going concern basis. |
Significant judgements and estimates |
The company makes estimates and assumptions concerning the future. Management are also required to exercise judgement in the process of applying the company's accounting policies. 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. |
The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are addressed below: |
In preparing these financial statements, the directors have made the following judgements: |
- Determine whether leases entered into by the company either as a lessor or a lessee are operating or finance leases. These decisions depend on an assessment of whether the risks and rewards of ownership have been transferred from the lessor to the lessee on a lease by lease basis based on an evaluation of the terms and conditions of the arrangements, and accordingly whether the lease requires an asset and liability to be recognised in the statement of financial position. |
- A provision is recognised when the company has a present legal or constructive obligation as a result of a past event for which it is probable that an outflow of resources will be required to settle the obligation and the amount can be reliably estimated. If the effect is material, provisions are determined by discounting the expected future cash flow at a rate that reflects the time value of money and the risks specific to the liability. |
- Whether a present obligation is probable or not requires judgement. The nature and type of risks for these provisions differ and management's judgement is applied regarding the nature and extent of obligations in deciding if an outflow of resources is probable or not. |
- Sales ledger debt provisions. Management review debts on a case by case basis to highlight deviation from terms and therefore possible provision requirement. |
- Stock provisions/quantity rebate provisions. On a line by line basis of known rebate suppliers, management assess and provide against the recorded cost the assessment of the rebate due on those units held at the year end. This is reviewed and agreed on a quarterly basis throughout the year on predetermined quantity triggers at agreed rates. |
- Depreciation and residual values. Management have reviewed the asset lives and associated residual values of all fixed asset classes and concluded that they are appropriate. |
The actual lives of the assets and residual values are assessed annually and may vary depending on a number of factors. In re-assessing asset lives, factors such as technological innovation, product life cycles and maintenance programmes are taken into account. Residual value assessments consider issues such as future market conditions, the remaining life of the asset and projects disposal values. |
Group Tyre Wholesale Limited (Registered number: 07399286) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2021 |
2. | ACCOUNTING POLICIES - continued |
Turnover |
Turnover comprises revenue recognised by the company in respect of goods and services supplied, exclusive of VAT and trade discounts. |
Turnover arises from the company's principal activity and sales are made to customers on both credit terms and by way of cash. In the case of credit sales revenue is recognised for accounting purposes at the date of dispatch of the relevant goods. In the case of cash sales, revenue is recognised at the point of sale. |
Tangible fixed assets |
Freehold property | - |
Improvements to property | - |
Plant and machinery | - |
Fixtures and fittings | - |
Motor vehicles | - |
Computer equipment | - |
The company operate a policy of not depreciating their freehold land and buildings. The Directors have assessed the difference between the residual value and the carrying cost of the building as being not material and have decided not to provide for any depreciation on the grounds that the aggregate depreciation to be provided over the life of the asset is not material. The company incurs expenses each year and ensures that they keep all freehold well maintained. They adopt a revaluation policy where revaluations occur with sufficient regularity to ensure that the carrying amount reflects the current market value. |
Revaluation surpluses are recognised in other comprehensive income and accumulated in equity. However, the increase is recognised in profit and loss to the extent that it reverses a revaluation decrease of the same asset previously recognised in profit and loss. |
The decrease of an asset's carrying amount on revaluation is recognised in other comprehensive income up to the amount of the previously recognised revaluation surplus accumulated in equity, in respect of that asset. Any excess deficits are charged to the profit and loss account. |
Stocks |
Stocks are valued at the lower of cost and net realisable value after making due allowance for obsolete and slow-moving stocks. Cost is calculated using the weighted average method and includes all direct costs. |
Taxation |
Taxation for the year comprises current and deferred tax. Tax is recognised in the 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 statement of financial position date. |
Deferred taxation |
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the statement of financial position 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. |
Group Tyre Wholesale Limited (Registered number: 07399286) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2021 |
2. | ACCOUNTING POLICIES - continued |
Foreign currencies |
Transactions denominated in foreign currencies are recorded at the rates of exchange ruling at the dates of the transactions, or at an average rate for the period if the rates do not fluctuate significantly. Monetary assets and liabilities are translated at year end exchange rates or, where appropriate, at rates of exchange fixed under the terms of the relevant transaction. The resulting exchange rate differences are charged to the profit and loss account. |
Operating lease agreements |
Rentals payable under operating leases are charged to profit or loss on a straight-line basis over the lease term, unless the rental payments are structured to increase in line with expected general inflation, in which case the group recognises annual rent expense equal to amounts owed to the lessor. The aggregate benefit of lease incentives are recognised as a reduction to the expense recognised over the lease term on a straight line basis. |
Pension costs and other post-retirement benefits |
The company operates a defined contribution pension scheme. Contributions payable to the company's pension scheme are charged to profit or loss in the period to which they relate. |
Derivatives |
Derivative financial instruments are recognised at fair value using a valuation technique with any gains or losses being reported in profit or loss. Outstanding derivatives at reporting date are included under the appropriate format heading depending on the nature of the derivative. |
Fixed asset investments |
Fixed asset investments are stated at cost less provision for diminution in value. |
3. | TURNOVER |
The turnover and profit before taxation are attributable to the one principal activity of the company. |
An analysis of turnover by geographical market is given below: |
2021 | 2020 |
£ | £ |
United Kingdom |
4. | EMPLOYEES AND DIRECTORS |
2021 | 2020 |
£ | £ |
Wages and salaries |
Social security costs |
Other pension costs |
The average number of employees during the year was as follows: |
2021 | 2020 |
Administration and management staff | 25 | 31 |
Warehouse and distribution staff | 82 | 89 |
Group Tyre Wholesale Limited (Registered number: 07399286) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2021 |
4. | EMPLOYEES AND DIRECTORS - continued |
2021 | 2020 |
£ | £ |
Directors' remuneration |
Directors' pension contributions to money purchase schemes |
The number of directors to whom retirement benefits were accruing was as follows: |
Money purchase schemes |
5. | OPERATING PROFIT |
The operating profit is stated after charging/(crediting): |
2021 | 2020 |
£ | £ |
Hire of plant and machinery |
Depreciation - owned assets |
Profit on disposal of fixed assets | ( |
) | ( |
) |
Auditors' remuneration |
Operating lease cost - land & buildings |
Operating lease cost - motor vehicles |
6. | INTEREST PAYABLE AND SIMILAR EXPENSES |
2021 | 2020 |
£ | £ |
Bank interest |
Hire purchase |
7. | 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 |
Corporation tax prior year | 1,099 | - |
Total current tax |
Deferred tax | ( |
) | ( |
) |
Tax on profit |
Group Tyre Wholesale Limited (Registered number: 07399286) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2021 |
7. | TAXATION - continued |
Reconciliation of total tax charge included in profit and loss |
The tax assessed for the year is lower than the standard rate of corporation tax in the UK. The difference is explained below: |
2021 | 2020 |
£ | £ |
Profit before tax |
Profit multiplied by the standard rate of corporation tax in the UK of (2020 - |
Effects of: |
Expenses not deductible for tax purposes |
Capital allowances in excess of depreciation | ( |
) | - |
Depreciation in excess of capital allowances | - |
Total tax charge | 154,294 | 99,091 |
8. | DIVIDENDS |
2021 | 2020 |
£ | £ |
Ordinary shares of £1 each |
Interim | 240,000 | - |
9. | TANGIBLE FIXED ASSETS |
Improvements |
Freehold | to | Plant and |
property | property | machinery |
£ | £ | £ |
COST OR VALUATION |
At 1 January 2021 |
Additions |
Disposals | ( |
) |
At 31 December 2021 |
DEPRECIATION |
At 1 January 2021 |
Charge for year |
Eliminated on disposal | ( |
) |
At 31 December 2021 |
NET BOOK VALUE |
At 31 December 2021 |
At 31 December 2020 |
Group Tyre Wholesale Limited (Registered number: 07399286) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2021 |
9. | TANGIBLE FIXED ASSETS - continued |
Fixtures |
and | Motor | Computer |
fittings | vehicles | equipment | Totals |
£ | £ | £ | £ |
COST OR VALUATION |
At 1 January 2021 |
Additions |
Disposals | ( |
) | ( |
) |
At 31 December 2021 |
DEPRECIATION |
At 1 January 2021 |
Charge for year |
Eliminated on disposal | ( |
) | ( |
) |
At 31 December 2021 |
NET BOOK VALUE |
At 31 December 2021 |
At 31 December 2020 |
Cost or valuation at 31 December 2021 is represented by: |
Improvements |
Freehold | to | Plant and |
property | property | machinery |
£ | £ | £ |
Valuation in 2013 | 456,063 | - | - |
Valuation in 2018 | 584,980 | - | - |
Cost | 1,243,957 | 134,413 | 1,171,398 |
2,285,000 | 134,413 | 1,171,398 |
Fixtures |
and | Motor | Computer |
fittings | vehicles | equipment | Totals |
£ | £ | £ | £ |
Valuation in 2013 | - | - | - | 456,063 |
Valuation in 2018 | - | - | - | 584,980 |
Cost | 160,372 | 52,026 | 153,516 | 2,915,682 |
160,372 | 52,026 | 153,516 | 3,956,725 |
If freehold property had not been revalued it would have been included at the following historical cost: |
2021 | 2020 |
£ | £ |
Cost | 1,243,957 | 1,243,957 |
Freehold property was valued on an open market basis on 20 April 2018 by Robinson & Hall LLP . |
Group Tyre Wholesale Limited (Registered number: 07399286) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2021 |
10. | FIXED ASSET INVESTMENTS |
Unlisted |
investments |
£ |
COST |
At 1 January 2021 |
and 31 December 2021 |
PROVISIONS |
At 1 January 2021 |
and 31 December 2021 | 2 |
NET BOOK VALUE |
At 31 December 2021 |
At 31 December 2020 |
11. | STOCKS |
2021 | 2020 |
£ | £ |
Stocks |
12. | DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2021 | 2020 |
£ | £ |
Trade debtors |
Amounts owed by group undertakings |
Other debtors |
Prepayments |
13. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2021 | 2020 |
£ | £ |
Bank loans and overdrafts (see note 15) |
Other loans (see note 15) |
Hire purchase contracts (see note 16) |
Trade creditors |
Tax |
Social security and other taxes |
VAT | 610,253 | 439,237 |
Other creditors |
Accruals and deferred income |
14. | CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR |
2021 | 2020 |
£ | £ |
Bank loans (see note 15) |
Hire purchase contracts (see note 16) |
Group Tyre Wholesale Limited (Registered number: 07399286) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2021 |
15. | LOANS |
An analysis of the maturity of loans is given below: |
2021 | 2020 |
£ | £ |
Amounts falling due within one year or on demand: |
Bank overdrafts |
Bank loans |
Invoice finance facility |
Amounts falling due between one and two years: |
Bank loans - 1-2 years |
Amounts falling due between two and five years: |
Bank loans - 2-5 years |
Amounts falling due in more than five years: |
Repayable by instalments |
Bank loans more 5 yr by instal | - | 90,000 |
Included within bank loans is a loan taken out in the prior year under the coronavirus business interruption loan scheme (CBILS). The government guarantees 80% of the finance to the lender and pays interest and any fees for the first 12 months after which the rate of interest of 2.54% over base will be applied for the duration of the agreed repayment term. |
Bank loans are repayable in instalments by 2024 and carry an interest rate of 1.65% above base rate. |
16. | LEASING AGREEMENTS |
Minimum lease payments fall due as follows: |
Hire purchase contracts |
2021 | 2020 |
£ | £ |
Net obligations repayable: |
Within one year |
Between one and five years |
Non-cancellable operating | leases |
2021 | 2020 |
£ | £ |
Within one year |
Between one and five years |
In more than five years |
Group Tyre Wholesale Limited (Registered number: 07399286) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2021 |
17. | SECURED DEBTS |
The following secured debts are included within creditors: |
2021 | 2020 |
£ | £ |
Bank overdrafts |
Invoice finance facility | 3,086,473 | 2,130,393 |
Bank loan & CBILS loan | 454,637 | 564,246 |
The invoice finance facility is secured by way of a fixed and floating charge over the assets of the company. |
Bank loans (including CBILS) and overdrafts are secured on fixed and floating charges over the assets of the company. |
18. | PROVISIONS FOR LIABILITIES |
2021 | 2020 |
£ | £ |
Deferred tax | 114,958 | 118,128 |
Deferred |
tax |
£ |
Balance at 1 January 2021 |
Provided during year | ( |
) |
Balance at 31 December 2021 |
19. | CALLED UP SHARE CAPITAL |
Allotted, called up and fully paid: |
2021 | 2020 |
Number | £ | Number | £ |
Ordinary A shares of £1 each | 333,333 | 333,333 | 333,333 | 333,333 |
Ordinary C shares of £1 each | 333,333 | 333,333 | 333,333 | 333,333 |
Ordinary D shares of £1 each | 333,334 | 333,334 | 333,334 | 333,334 |
1,000,000 | 1,000,000 | 1,000,000 | 1,000,000 |
20. | RESERVES |
Retained | Revaluation |
earnings | reserve | Totals |
£ | £ | £ |
At 1 January 2021 | 1,642,519 |
Profit for the year |
Dividends | ( |
) | ( |
) |
At 31 December 2021 | 2,061,252 |
21. | CAPITAL COMMITMENTS |
At the year end Group Tyre Wholesale Limited had committed to capital spend of £277,172 (excluding VAT). |
Group Tyre Wholesale Limited (Registered number: 07399286) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2021 |
22. | RELATED PARTY DISCLOSURES |
During the year the company made sales totalling £71,141 (2020 - £125,451) to, and purchases totalling £64,527 (2020 - £152,967) from, BA Bush & Son Limited, a company incorporated in England & Wales which is related by virtue of its joint control over the company. Included within creditors due in one year is a balance due from the company to BA Bush & Son Limited at the year end of £1,344 (2020 - £1,639). |
During the year the company made sales totalling £913,972 (2020 - £840,315) to, and purchases totalling £129,375 (2020 - £477,515) from, S&M Tyres Holdings Limited, a company incorporated in England & Wales which is related by virtue of its joint control over the company. Included within debtors due in one year is a balance due from S&M Tyres Holdings Limited at the year end of £455,489 (2020 - £11,006). |
During the year the company made sales totalling £485,057 (2020 - £297,420) to, and purchases totalling £8,290 (2020 - £8,008) from, Tyres Direct On-line Limited, a company incorporated in England & Wales which is related by virtue of its family connection to MD Gary Oliver. Included within debtors due in one year is a balance due from Tyres Direct On-line Limited at the year end of £100,676 (2020 - £66,771). |
During the year the company made sales totalling £11,383 (2020 - £8,107) from Abbey Tyre Co. (Cambridge) Limited, a company incorporated in England & Wales which is related by virtue of its common directorship with N Bush. Included within debtors due in one year is a balance due from Abbey Tyre Co. (Cambridge) Limited at the year end of £nil (2020 - £3,678). |
During the year, a total of key management personnel compensation of £ |
23. | ULTIMATE CONTROLLING PARTY |
At the balance sheet date the directors consider the ultimate controlling party to be the owners of the joint venture investors BA Bush & Son Limited and S&M Tyres Holdings Limited. |
All joint venture companies are registered in England & Wales. |