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Registered number: 03027229









ROYSTON LABELS LIMITED









ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 APRIL 2023

 
ROYSTON LABELS LIMITED
 
 
COMPANY INFORMATION


DIRECTORS
Mr P Clayton 
Mrs S Clayton 




COMPANY SECRETARY
Mrs S Clayton



REGISTERED NUMBER
03027229



REGISTERED OFFICE
Salisbury House
Station Road

Cambridge

CB1 2LA




TRADING ADDRESS
Unit 17 - 20 Greenfield

Royston

SG8 5HN






INDEPENDENT AUDITORS
Peters Elworthy & Moore
Chartered Accountants & Statutory Auditors

Salisbury House

Station Road

Cambridge

CB1 2LA




BANKERS
HSBC Bank Plc
132 High Street

Huntingdon

PE18 6NG





 
ROYSTON LABELS LIMITED
 

CONTENTS



Page
Strategic Report
 
1 - 2
Directors' Report
 
3 - 4
Independent Auditors' Report
 
5 - 8
Statement of Comprehensive Income
 
9
Balance Sheet
 
10
Statement of Changes in Equity
 
11
Statement of Cash Flows
 
12
Notes to the Financial Statements
 
13 - 26


 
ROYSTON LABELS LIMITED
 
 
STRATEGIC REPORT
FOR THE YEAR ENDED 30 APRIL 2023

INTRODUCTION
 
The directors present their strategic report and business review, which includes the principal risks and uncertainties of the business, key performance indicators and future developments.

BUSINESS REVIEW
 
The principal activity of the company continued to be that of the manufacture of self-adhesive labels.
The Company continues to offer award winning products into a number of different industry sectors. There is a continued focus on quality, customer service and innovation. 
The company continues to win awards for both the quality and the innovative work it produces.  In recent months it has been chosen to support a range of market leading suppliers and customers in complex innovation projects, because of its ability to manage difficult and unusual requirements.
The company however has to report a reduction in turnover and margin, based on levels achieved in recent years.  This is as a direct result of the short term increase in raw material and energy costs which have affected both the company and its customers performance in the last 12 months. 
INVESTMENT
The company continues to invest in the latest technology.  The company is investigating self-generated renewable sources with a view to reducing energy costs and support its focus on sustainability.
SUPPLIERS
The company continues to purchase quality products from market leading global suppliers.  It regularly monitors supplier performance to ensure a high level of service and quality at a competitive price.
The company has continued to see improvements in delivery lead-times and is expecting the pricing of raw material to reduce over the coming months. 
CUSTOMERS
The company has a wide range of customers ordering a variety of labels. Many customers have a long-standing relationship with the company and have given the company preferred supplier status due to its ability to manage complex projects and provide quality products within pre agreed time frames. The company continues to introduce a range of new customers and markets to the customer base. 
Customer service and quality remain the highest priority to the Company. 

PRINCIPAL RISKS AND UNCERTAINTIES
 
Risks to the business include its relationships with key suppliers and key customers. The company continues to foster strong relationships with its suppliers and makes payment in line with agreed terms and constantly monitors company service levels to ensure customer satisfaction. 
The directors routinely monitor all known risks and uncertainties and appropriate actions are taken to mitigate the risks of their potential outcomes.
Increased energy costs has had a significant impact on the company and its customers, but as wholesale costs continue to reduce this is deemed to be a short-term issue that will not affect the company’s long-term goals.

Page 1

 
ROYSTON LABELS LIMITED
 

STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2023

FINANCIAL KEY PERFORMANCE INDICATORS
 
The directors have agreed a set of Key Performance Indicators and targets which collectively help monitor and drive performance, these are monitored on a weekly and monthly basis and comparisons are made to budgets, forecasts and prior year results. These are currently in line with the current trading market.

This report was approved by the board and signed on its behalf by:





Mr P Clayton
Director

Date: 22 September 2023

Page 2

 
ROYSTON LABELS LIMITED
 
 
 
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 APRIL 2023

The directors present their report and the financial statements for the year ended 30 April 2023.

RESULTS AND DIVIDENDS

The loss for the year, after taxation, amounted to £180,990 (2022 - profit £461,462).

Dividends of £1,000 (2022 - £2,000) were declared during the year.

DIRECTORS

The directors who served during the year were:

Mr P Clayton 
Mrs S Clayton 

DIRECTORS' RESPONSIBILITIES STATEMENT

The directors are responsible for preparing the Strategic Report, the Directors' Report 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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), 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 for the Company's financial statements 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 to enable them to ensure that the financial statements comply with the Companies Act 2006They 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.

FUTURE DEVELOPMENTS

The directors intend to continue to grow all areas of the business.

Page 3

 
ROYSTON LABELS LIMITED
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2023

DISCLOSURE OF INFORMATION TO AUDITORS

Each of the persons who are directors at the time when this Directors' Report is approved has confirmed that:
 
so far as the director is aware, there is no relevant audit information of which the Company's auditors are unaware, and

the director has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the Company's auditors are aware of that information.

POST BALANCE SHEET EVENTS

There have been no significant events affecting the Company since the year end.

AUDITORS

The auditorsPeters Elworthy & Moorewill be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

This report was approved by the board and signed on its behalf by:
 





Mr P Clayton
Director

Date: 22 September 2023

Page 4

 
ROYSTON LABELS LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF ROYSTON LABELS LIMITED
 

OPINION


We have audited the financial statements of Royston Labels Limited (the 'Company') for the year ended 30 April 2023, which comprise the Statement of Comprehensive Income, the Balance Sheet, the Statement of Cash Flows, the Statement of Changes in Equity and the related notes, including a summary of significant accounting policiesThe 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 30 April 2023 and of its loss 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 United Kingdom, including the Financial Reporting Council'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.


Page 5

 
ROYSTON LABELS LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF ROYSTON LABELS LIMITED (CONTINUED)


OTHER INFORMATION


The other information comprises the information included in the Annual Report other than the financial statements and  our Auditors' Report thereon.  The directors are responsible for the other information contained within the Annual Report.  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. 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 course of 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.


OPINION 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 Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.


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 Directors' Report.


We have nothing to report in respect of the following matters in relation to which 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 Directors' Responsibilities Statement set out on page 3, 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 is 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.


Page 6

 
ROYSTON LABELS LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF ROYSTON LABELS LIMITED (CONTINUED)


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 an Auditors' Report 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.


Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:
 
we identified the laws and regulations applicable to the Company through discussions with management, and from our commercial knowledge and experience of the manufacturing sector;
we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements, including FRS 102, the Companies Act 2006 and taxation legislation, or the operations of the Company including data protection, employment and health and safety legislation;
we obtained an understanding of the Company’s policies and procedures on compliance with laws and regulations, including documentation of any instances of non-compliance;
we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management; and
identified laws and regulations were communicated within the audit engagement team regularly and the team remained alert to instances of non-compliance throughout the audit.

We assessed the susceptibility of the Company’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud and considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations.
We discussed among the audit engagement team regarding the opportunities and incentives that may exist within the organisation for fraud and how and where fraud might occur in the financial statements.
In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of fraud through management bias and override of controls. In addressing the risk of fraud through management bias and override of controls we:
 
tested the appropriateness of journal entries and other adjustments;
designed procedures to identify unexpected and unusual journal entries and performed testing to confirm the validity of such postings;
assessed whether the accounting judgements made in the financial statements were indicative of potential bias; and
evaluated the business rationale of any significant transactions that were unusual or outside the normal course of business.

 
Page 7

 
ROYSTON LABELS LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF ROYSTON LABELS LIMITED (CONTINUED)


AUDITORS' RESPONSIBILITIES FOR THE AUDIT OF THE FINANCIAL STATEMENTS (CONTINUED)
In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:
 
agreeing financial statement disclosures to underlying supporting documentation; and
enquiring of management as to actual and potential litigation and claims.


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 Auditors' Report.


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 2006Our 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 an Auditors' Report 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.







Stephen Peak (Senior Statutory Auditor)
  
for and on behalf of
Peters Elworthy & Moore
 
Chartered Accountants
Statutory Auditors
  
Salisbury House
Station Road
Cambridge
CB1 2LA

29 September 2023
Page 8

 
ROYSTON LABELS LIMITED
 
 
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 APRIL 2023

2023
2022
Note
£
£

  

Turnover
 4 
8,886,821
9,558,836

Cost of sales
  
(7,041,767)
(6,929,368)

GROSS PROFIT
  
1,845,054
2,629,468

Administrative expenses
  
(1,952,806)
(1,860,250)

OPERATING (LOSS)/PROFIT
 5 
(107,752)
769,218

Interest receivable and similar income
 9 
3,718
134

Interest payable and similar expenses
 10 
(116,845)
(88,133)

(LOSS)/PROFIT BEFORE TAX
  
(220,879)
681,219

Tax on (loss)/profit
 11 
39,889
(219,757)

(LOSS)/PROFIT FOR THE FINANCIAL YEAR
  
(180,990)
461,462

There were no recognised gains and losses for 2023 or 2022 other than those included in the statement of comprehensive income.

There was no other comprehensive income for 2023 (2022 - £NIL).

The notes on pages 13 to 26 form part of these financial statements.

Page 9

 
ROYSTON LABELS LIMITED
REGISTERED NUMBER: 03027229

BALANCE SHEET
AS AT 30 APRIL 2023

2023
2022
Note
£
£

FIXED ASSETS
  

Tangible assets
 13 
5,271,435
5,656,228

  
5,271,435
5,656,228

CURRENT ASSETS
  

Stocks
 14 
925,734
858,579

Debtors: amounts falling due within one year
 15 
1,724,513
1,761,621

Cash at bank and in hand
 16 
1,020,832
1,621,359

  
3,671,079
4,241,559

Creditors: amounts falling due within one year
 17 
(1,888,612)
(2,310,609)

NET CURRENT ASSETS
  
 
 
1,782,467
 
 
1,930,950

TOTAL ASSETS LESS CURRENT LIABILITIES
  
7,053,902
7,587,178

Creditors: amounts falling due after more than one year
 18 
(1,568,449)
(1,910,283)

PROVISIONS FOR LIABILITIES
  

Deferred tax
 21 
(357,893)
(367,345)

  
 
 
(357,893)
 
 
(367,345)

NET ASSETS
  
5,127,560
5,309,550


CAPITAL AND RESERVES
  

Called up share capital 
 22 
1,000
1,000

Profit and loss account
 23 
5,126,560
5,308,550

  
5,127,560
5,309,550


The financial statements were approved and authorised for issue by the board and were signed on its behalf by: 




Mr P Clayton
Director

Date: 22 September 2023

The notes on pages 13 to 26 form part of these financial statements.

Page 10

 
ROYSTON LABELS LIMITED
 

STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 APRIL 2023


Called up share capital
Profit and loss account
Total equity

£
£
£


AT 1 MAY 2021
1,000
4,849,088
4,850,088



Profit for the year
-
461,462
461,462

Dividends paid
-
(2,000)
(2,000)



AT 1 MAY 2022
1,000
5,308,550
5,309,550



Loss for the year
-
(180,990)
(180,990)

Dividends paid
-
(1,000)
(1,000)


AT 30 APRIL 2023
1,000
5,126,560
5,127,560


The notes on pages 13 to 26 form part of these financial statements.

Page 11

 
ROYSTON LABELS LIMITED
 

STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 APRIL 2023

2023
2022
£
£

CASH FLOWS FROM OPERATING ACTIVITIES

(Loss) / profit for the financial year
(180,990)
461,462

ADJUSTMENTS FOR:

Depreciation of tangible assets
596,431
629,172

Interest paid
116,845
88,133

Interest received
(3,718)
(134)

Taxation charge
(39,889)
219,757

(Increase) in stocks
(67,155)
(113,912)

Decrease in debtors
67,075
139,113

(Decrease) in creditors
(177,769)
(219,020)

Corporation tax (paid)/received
(112,831)
-

NET CASH GENERATED FROM OPERATING ACTIVITIES

197,999
1,204,571


CASH FLOWS FROM INVESTING ACTIVITIES

Purchase of tangible fixed assets
(211,638)
(124,039)

Interest received
3,718
134

HP interest paid
(51,547)
(53,235)

NET CASH FROM INVESTING ACTIVITIES

(259,467)
(177,140)

CASH FLOWS FROM FINANCING ACTIVITIES

Repayment of loans
(115,221)
(182,985)

Repayment of/new finance leases
(357,540)
(365,878)

Dividends paid
(1,000)
(2,000)

Interest paid
(65,298)
(34,898)

NET CASH USED IN FINANCING ACTIVITIES
(539,059)
(585,761)

(DECREASE)/INCREASE IN CASH AND CASH EQUIVALENTS
(600,527)
441,670

Cash and cash equivalents at beginning of year
1,621,359
1,179,689

CASH AND CASH EQUIVALENTS AT THE END OF YEAR
1,020,832
1,621,359


CASH AND CASH EQUIVALENTS AT THE END OF YEAR COMPRISE:

Cash at bank and in hand
1,020,832
1,621,359

1,020,832
1,621,359


Page 12

 
ROYSTON LABELS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023

1.


GENERAL INFORMATION

Royston Labels Limited is a private company limited by shares, incorporated in England and Wales. Its registered office is Salisbury House, Station Road, Cambridge, CB1 2LA. Its principal place of business is Unit 17-20 Greenfield, Royston, SG8 5HN.

2.ACCOUNTING POLICIES

 
2.1

BASIS OF PREPARATION OF FINANCIAL STATEMENTS

The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.

The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgement in applying the Company's accounting policies (see note 3).

The following principal accounting policies have been applied:

 
2.2

FOREIGN CURRENCY TRANSLATION

Functional and presentation currency

The Company's functional and presentational currency is GBP.

Transactions and balances

Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.

At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.

Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss except when deferred in other comprehensive income as qualifying cash flow hedges.

Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the Statement of Comprehensive Income within 'finance income or costs'. All other foreign exchange gains and losses are presented in profit or loss within 'other operating income'.

Page 13

 
ROYSTON LABELS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023

2.ACCOUNTING POLICIES (CONTINUED)

 
2.3

TURNOVER

Turnover is recognised to the extent that it is probable that the economic benefits will flow to the Company and the turnover can be reliably measured. Turnover is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before turnover is recognised:

Sale of goods

Turnover from the sale of goods is recognised when all of the following conditions are satisfied:
the Company has transferred the significant risks and rewards of ownership to the buyer;
the Company retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;
the amount of turnover can be measured reliably;
it is probable that the Company will receive the consideration due under the transaction; and
the costs incurred or to be incurred in respect of the transaction can be measured reliably.

 
2.4

OPERATING LEASES

Rentals paid under operating leases are charged to profit or loss on a straight-line basis over the lease term.

 
2.5

LEASED ASSETS

Assets obtained under hire purchase contracts and finance leases are capitalised as tangible fixed assets. Assets acquired by finance lease are depreciated over the shorter of the lease term and their useful lives. Assets acquired by hire purchase are depreciated over their useful lives. Finance leases are those where substantially all of the benefits and risks of ownership are assumed by the company. Obligations under such agreements are included in creditors net of the finance charge allocated to future periods. The finance element of the rental payment is charged to profit or loss so as to produce a constant periodic rate of charge on the net obligation outstanding in each period.

 
2.6

INTEREST INCOME

Interest income is recognised in profit or loss using the effective interest method.

 
2.7

FINANCE COSTS

Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.

 
2.8

BORROWING COSTS

All borrowing costs are recognised in profit or loss in the year in which they are incurred.

Page 14

 
ROYSTON LABELS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023

2.ACCOUNTING POLICIES (CONTINUED)

 
2.9

PENSIONS

DEFINED CONTRIBUTION PENSION PLAN

The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations.

The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Balance Sheet. The assets of the plan are held separately from the Company in independently administered funds.

 
2.10

CURRENT AND DEFERRED TAXATION

The tax expense for the year comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.

The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the balance sheet date in the countries where the Company operates and generates income.

Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the balance sheet date, except that:
The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and
Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.

Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

 
2.11

TANGIBLE FIXED ASSETS

Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

Page 15

 
ROYSTON LABELS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023

2.ACCOUNTING POLICIES (CONTINUED)


2.11
TANGIBLE FIXED ASSETS (CONTINUED)

Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.

Depreciation is provided on the following basis:

Freehold property
-
1% straight line
Long-term leasehold property
-
over the period of the lease
Plant and machinery
-
10-20% straight line
Fixtures and fittings
-
20-25% straight line
Office equipment
-
25-33% straight line

The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.

 
2.12

STOCKS

Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis. Work in progress and finished goods include labour and attributable overheads.

At each balance sheet date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in profit or loss.

 
2.13

DEBTORS

Short-term debtors are measured at transaction price, less any impairment.

 
2.14

CASH AND CASH EQUIVALENTS

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.

In the Statement of Cash Flows, cash and cash equivalents are shown net of bank overdrafts that are repayable on demand and form an integral part of the Company's cash management.

 
2.15

CREDITORS

Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.

Page 16

 
ROYSTON LABELS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023

2.ACCOUNTING POLICIES (CONTINUED)

 
2.16

PROVISIONS FOR LIABILITIES

Provisions are made where an event has taken place that gives the Company a legal or constructive obligation that probably requires settlement by a transfer of economic benefit, and a reliable estimate can be made of the amount of the obligation.
Provisions are charged as an expense to profit or loss in the year that the Company becomes aware of the obligation, and are measured at the best estimate at the balance sheet date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties.
When payments are eventually made, they are charged to the provision carried in the Balance Sheet.

 
2.17

FINANCIAL INSTRUMENTS

The Company only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in ordinary shares.

 
2.18

DIVIDENDS

Equity dividends are recognised when they become legally payable. Interim equity dividends are recognised when paid. Final equity dividends are recognised when approved by the shareholders at an annual general meeting.


3.



JUDGEMENTS IN APPLYING ACCOUNTING POLICIES AND KEY SOURCES OF ESTIMATION UNCERTAINTY

Preparation of the financial statements requires management to make significant judgments and estimates. The items in the financial statements where these judgements and estimates have been made include:
Depreciation - the charge in the year is based on the policies outlined in accounting policy 2.11.


4.


TURNOVER

The whole of the turnover is attributable to the sale of complex embellished flexographic and digital self-adhesive labels.

Analysis of turnover by country of destination:

2023
2022
£
£

United Kingdom
7,801,857
8,571,810

Rest of Europe
1,073,024
926,490

Rest of the world
11,940
60,536

8,886,821
9,558,836


Page 17

 
ROYSTON LABELS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023

5.


OPERATING (LOSS)/PROFIT

The operating (loss)/profit is stated after charging:

2023
2022
£
£

Exchange differences
146
(207)

Other operating lease rentals
258,500
259,554


6.


AUDITORS' REMUNERATION

During the year, the Company obtained the following services from the Company's auditors:


2023
2022
£
£

Fees payable to the Company's auditors for the audit of the Company's financial statements
10,500
8,350

7.


EMPLOYEES

Staff costs, including directors' remuneration, were as follows:


2023
2022
£
£

Wages and salaries
2,627,301
2,564,076

Social security costs
279,025
258,607

Cost of defined contribution scheme
66,168
64,425

2,972,494
2,887,108


The average monthly number of employees, including the directors, during the year was 75 (2022 - 76).

Page 18

 
ROYSTON LABELS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023

8.


DIRECTORS' REMUNERATION

2023
2022
£
£

Directors' emoluments
316,615
315,934

316,615
315,934


The highest paid director received remuneration of £230,283 (2022 - £229,794).

The value of the Company's contributions paid to a defined contribution pension scheme in respect of the highest paid director amounted to £NIL (2022 - £NIL).


9.


INTEREST RECEIVABLE

2023
2022
£
£


Other interest receivable
3,718
134

3,718
134


10.


INTEREST PAYABLE AND SIMILAR EXPENSES

2023
2022
£
£


Other loan interest payable
69
-

Mortgage interest payable
64,796
34,898

Finance leases and hire purchase contracts
51,547
53,235

Other interest payable
433
-

116,845
88,133

Page 19

 
ROYSTON LABELS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023

11.


TAXATION


2023
2022
£
£

CORPORATION TAX


Current tax on profits for the year
-
151,846

Adjustments in respect of previous periods
(30,437)
-

TOTAL CURRENT TAX
(30,437)
151,846

DEFERRED TAX


Origination and reversal of timing differences
(9,452)
(26,647)

Effect of tax rate change on opening balance
-
94,558

TOTAL DEFERRED TAX
(9,452)
67,911


TAXATION ON (LOSS)/PROFIT ON ORDINARY ACTIVITIES
(39,889)
219,757

FACTORS AFFECTING TAX CHARGE FOR THE YEAR

The tax assessed for the year is higher than (2022 - higher than) the standard rate of corporation tax in the UK of 19.49% (2022 - 19.00%). The differences are explained below:

2023
2022
£
£


(Loss)/profit on ordinary activities before tax
(220,879)
681,219


(Loss)/profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 19.49% (2022 - 19.00%)
(43,056)
129,432

EFFECTS OF:


Expenses not deductible for tax purposes
7,354
547

Capital allowances for year in excess of depreciation
(2,895)
1,615

Adjustments to tax charge in respect of prior periods
(30,437)
-

Remeasurement of deferred tax for changes in tax rates
(2,083)
88,163

Losses carried back
31,228
-

TOTAL TAX CHARGE FOR THE YEAR
(39,889)
219,757

FACTORS THAT MAY AFFECT FUTURE TAX CHARGES
The main rate of corporation tax for companies earning annual taxable profits in excess of £250,000 rose to 25% with effect from 1 April 2023, having been substantively enacted on 24 May 2021. Accordingly the closing deferred tax liabilities have been measured at the rate of 25.00% (2021 - 25.00%).

Page 20

 
ROYSTON LABELS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023

12.


DIVIDENDS

2023
2022
£
£


Paid during the year
1,000
2,000

1,000
2,000


13.


TANGIBLE FIXED ASSETS





Freehold property
Long-term leasehold property
Plant and machinery
Fixtures and fittings
Office equipment
Total

£
£
£
£
£
£



COST


At 1 May 2022
3,158,774
823,012
7,758,961
167,639
490,963
12,399,349


Additions
3,727
-
197,947
-
9,964
211,638



At 30 April 2023

3,162,501
823,012
7,956,908
167,639
500,927
12,610,987



DEPRECIATION


At 1 May 2022
91,266
322,346
5,752,108
143,384
434,017
6,743,121


Charge for the year on owned assets
23,636
82,302
208,971
23,541
37,508
375,958


Charge for the year on financed assets
-
-
220,473
-
-
220,473



At 30 April 2023

114,902
404,648
6,181,552
166,925
471,525
7,339,552



NET BOOK VALUE



At 30 April 2023
3,047,599
418,364
1,775,356
714
29,402
5,271,435



At 30 April 2022
3,067,508
500,666
2,006,853
24,255
56,946
5,656,228

The net book value of assets held under finance leases or hire purchase contracts, included above, are as follows:


2023
2022
£
£



Plant and machinery
1,012,249
1,402,935

Page 21

 
ROYSTON LABELS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023

14.


STOCKS

2023
2022
£
£

Raw materials and consumables
617,957
580,650

Work in progress (goods to be sold)
107,726
120,465

Finished goods and goods for resale
200,051
157,464

925,734
858,579



15.


DEBTORS

2023
2022
£
£


Trade debtors
1,579,509
1,670,962

Other debtors
30,837
870

Prepayments and accrued income
114,167
89,789

1,724,513
1,761,621



16.


CASH AND CASH EQUIVALENTS

2023
2022
£
£

Cash at bank and in hand
1,020,832
1,621,359

1,020,832
1,621,359


Page 22

 
ROYSTON LABELS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023

17.


CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

2023
2022
£
£

Bank loans
88,369
137,610

Trade creditors
1,127,208
1,285,178

Corporation tax
-
113,301

Other taxation and social security
226,726
230,027

Obligations under finance leases and hire purchase contracts
272,468
354,154

Other creditors
13,822
14,986

Accruals and deferred income
160,019
175,353

1,888,612
2,310,609


Secured loans
Bank loans comprise a mortgage that is secured on the property. Interest is charged at 2.0% above base rate per annum and repayments of £15,000 are made monthly, with the balance of the loan due for repayment on 28 April 2026.
Obligations under finance lease and hire purchase contracts are secured on the assets concerned.


18.


CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR

2023
2022
£
£

Bank loans
1,283,327
1,349,307

Obligations under finance leases and hire purchase contracts
285,122
560,976

1,568,449
1,910,283


Secured loans
Bank loans comprise a mortgage that is secured on the property. Interest is charged at 2.0% above base rate per annum and repayments of £15,000 are made monthly, with the balance of the loan due for repayment on 28 April 2026.
Obligations under finance lease and hire purchase contracts are secured on the assets concerned.

Page 23

 
ROYSTON LABELS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023

19.


LOANS


Analysis of the maturity of loans is given below:


2023
2022
£
£

Within one year
88,369
137,610

Between 1-2 years
93,086
1,349,307

Between 2-5 years
1,190,241
-

1,371,696
1,486,917



20.


HIRE PURCHASE AND FINANCE LEASES


Minimum lease payments under hire purchase fall due as follows:

2023
2022
£
£


Within one year
272,468
354,154

Between 1-5 years
285,122
560,976

557,590
915,130


21.


DEFERRED TAXATION




2023
2022


£

£






At beginning of year
367,345
299,434


Charged to profit or loss
(9,452)
67,911



AT END OF YEAR
357,893
367,345

Page 24

 
ROYSTON LABELS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023
 
21.DEFERRED TAXATION (CONTINUED)

The provision for deferred taxation is made up as follows:

2023
2022
£
£


Accelerated capital allowances
359,271
368,686

Short term timing differences
(1,378)
(1,341)

357,893
367,345


22.


SHARE CAPITAL

2023
2022
£
£
ALLOTTED, CALLED UP AND FULLY PAID



1,000 (2022 - 1,000) Ordinary shares of £1.00 each
1,000
1,000



23.


RESERVES

Profit and loss account

Includes all current and prior year retained profits and losses.

24.


ANALYSIS OF NET DEBT





At 1 May 2022
Cash flows
Other non-cash changes
At 30 April 2023
£

£

£

£

Cash at bank and in hand

1,621,359

(600,527)

-

1,020,832

Debt due after 1 year

(1,349,307)

-

1,349,307

-

Debt due within 1 year

(137,610)

115,221

(1,349,307)

(1,371,696)

Finance leases

(915,130)

357,540

-

(557,590)



(780,688)
(127,766)
-
(908,454)

Page 25

 
ROYSTON LABELS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023

25.


PENSION COMMITMENTS

The company operates a defined contribution pension scheme for the employees and a Small Self Administered Scheme for the directors. The assets of the schemes are held separately from those of the company in independently administered funds. The pension cost charge represents contributions payable by the company to the funds and amounted to £66,168 (2022 - £64,425). Contributions payable to the fund as at the balance sheet date were £10,934 (2022 - £10,876).


26.


COMMITMENTS UNDER OPERATING LEASES

At 30 April 2023 the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:

2023
2022
£
£


Not later than 1 year
169,962
273,133

Later than 1 year and not later than 5 years
521,381
688,721

Later than 5 years
-
112,500

691,343
1,074,354


27.


RELATED PARTY TRANSACTIONS

Mr P Clayton
Mr P Clayton, director, held a director’s loan account with the Company during the year. This loan bears interest at 2.5% above Bank of England base rate and is repayable on demand. The balance due to Mr P Clayton as at 30 April 2022 was £1,442 (2022 - £808), which is included within other creditors. The maximum overdrawn balance during the year was £NIL (2022 - £NIL). Net interest of £NIL (2021 - £NIL) was paid on the overdrawn balance during the year. A dividend of £1,000 (2022 - £2,000) was paid during the year.


28.


CONTROLLING PARTY

The company is controlled by the director, Mr P Clayton, by virtue of his 100% shareholding.

 
Page 26