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Registration number: 01314060

Slemcka (DMS) Limited

Annual Report and Consolidated Financial Statements

for the Year Ended 31 December 2022

 

Slemcka (DMS) Limited

Contents

Company Information

1

Strategic Report

2 to 3

Directors' Report

4 to 5

Statement of Directors' Responsibilities

6

Independent Auditor's Report

7 to 11

Consolidated Profit and Loss Account

12

Consolidated Statement of Comprehensive Income

13

Consolidated Balance Sheet

14 to 15

Balance Sheet

16

Consolidated Statement of Changes in Equity

17

Statement of Changes in Equity

18

Consolidated Statement of Cash Flows

19 to 20

Notes to the Financial Statements

21 to 40

 

Slemcka (DMS) Limited

Company Information

Directors

K. J. Bates

M. K. Bates

C. M. Bates

L. D. Goodfellow

S. E. Laronde

Registered office

Elan House
Park Lane
Castle Vale
Birmingham
B35 6LJ

Bankers

Barclays Bank Plc
15 Colmore Row
Birmingham
B3 2WN

Auditors

Robert Whowell & Partners
Chartered Accountants
Westwood House
78 Loughborough Road
Quorn
Loughborough
Leicestershire
LE12 8DX

 

Slemcka (DMS) Limited

Strategic Report for the Year Ended 31 December 2022

The directors present their strategic report for the year ended 31 December 2022.

Fair review of the business

The group experienced weaker trading results during the year from Lloyd Pascal & Company Limited and it’s Hong Kong subsidiary, Lloyd Pascal (Hong Kong) Limited. The consolidated revenue and results of the group which incorporates the Hong Kong subsidiary are disclosed in the statutory financial statements.

The impact on the economy of higher inflation and reduced consumer spending have impacted on group sales and profitability. Retailers have corrected their own stock levels following the shipping issues of last year which has reduced demand. The impact of this resulted in group revenues falling by 15% to £12.8 million (2021 - £15.1 million), gross profit remained consistent at 26.1% (2021 - 25.9%) and the profit before tax for the year was £238,682 (2021 - £761,057).

The COVID pandemic presented its challenges, most notably the impact of higher costs of goods and inflationary pressures on both business and consumer. Despite the challenge of increased raw material and shipping costs, the group has continued to offer new innovative quality product.

With the mounting cost of living crisis, the group remains conscious of the impact on the consumer and remains focused on delivering outstanding value to our customers.

The group’s net assets increased by £227,139 (1.7%) from 2021. The net increase in assets has arisen principally as a result of upward property revaluations and retained profits, after dividend payments amounting to £200,000 (2021 - £150,000) during the year.

End of year cash balances remain strong with £1.97 million held at bank (2021 - £2.10 million).

The group's key financial and other performance indicators during the year were as follows:

Financial KPIs

Unit

2022

2021

Gross profit margin

%

26.14

25.90

Net profit margin

%

1.87

3.95

Return on capital employed

%

1.59

5.42

Working capital ratio

%

7.13

5.53

Debtor days

89.00

69.00

Creditor days

22.00

34.00

Stock turnover

3.44

4.11

 

Slemcka (DMS) Limited

Strategic Report for the Year Ended 31 December 2022

Research and development

The group has invested heavily in R&D in order to adapt to consumer trends. Extensive research has been undertaken to include the use of third party trend forecasting and future consumer insights, and the addition of external design agencies and product designer to develop robust new concepts for customer new product development strategies. All products designed under Lloyd Pascal and tertiary brands, remain the intellectual property of Lloyd Pascal & Co Ltd and fully comply with required parameters and relevant safety and industry standards.

Principal risks and uncertainties

Management continually monitor the key risks facing the group together with assesing the controls used for managing these risks. The board of directors formally reviews and documents the principal risks facing the business at least annually. The principal risks and uncertainties facing the group are volatility in ongoing market conditions and UK consumer confidence and price pressure from both customers and suppliers.

The group considers that it has sufficient debt free resources to manage the business through any worsening of the econmic climate over the next 12 months.

Approved and authorised by the Board on 27 September 2023 and signed on its behalf by:
 

.........................................
M. K. Bates
Director

 

Slemcka (DMS) Limited

Directors' Report for the Year Ended 31 December 2022

The directors present their report and the for the year ended 31 December 2022.

Directors of the group

The directors who held office during the year were as follows:

K. J. Bates

M. K. Bates

C. M. Bates

L. D. Goodfellow

S. E. Laronde

Results and dividends

The profit for the year, after taxation, amounted to £190,889 (2021 - £596,935).

During the year, the directors recommended the payment of a dividend totalling £200,000 (2021 - £150,000). No further dividends were recommended during the year.

Financial instruments

The group currently has no requirement for an overdraft or other facilities in order to trade.

Risks

Liquidity risk
The group's exposure to liquidity risk is not considered to be material.

Foreign currency risk
The group trades mainly is US dollars and holds sufficient dollar reserves for trading purposes.

Credit risk
Investment of cash surpluses are made on bank deposits only. All customers who wish to trade on credit terms are subject to credit verification procedures. Receivable balances are closely monitored and provision is made for any doubtful debts. The group has arranged credit insurance cover, further reducing this risk exposure.

Future developments

The directors believe that the group is well placed in terms of strategic and market position to generate sales and satisfy customer demand in spite of the risks and uncertainties outlined in the strategic report.

 

Slemcka (DMS) Limited

Directors' Report for the Year Ended 31 December 2022

Approved and authorised by the Board on 27 September 2023 and signed on its behalf by:

.........................................
M. K. Bates
Director

 

Slemcka (DMS) Limited

Statement of Directors' Responsibilities

The directors acknowledge their responsibilities for preparing the Annual 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 United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). 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 group and the company and of the profit or loss of the group for that period. In preparing these financial statements, the directors are required to:

select suitable accounting policies and apply them consistently;

make judgements and accounting estimates that are reasonable and prudent;

state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and

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 group's and the company's transactions and disclose with reasonable accuracy at any time the financial position of the group and 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 group and the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

 

Slemcka (DMS) Limited

Independent Auditor's Report to the Members of Slemcka (DMS) Limited

Opinion

We have audited the financial statements of Slemcka (DMS) Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2022, which comprise the Consolidated Profit and Loss Account, Consolidated Statement of Comprehensive Income, Consolidated Balance Sheet, Balance Sheet, Consolidated Statement of Changes in Equity, Statement of Changes in Equity, Consolidated Statement of Cash Flows, and 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 the parent company's affairs as at 31 December 2022 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 auditor 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.

 

Slemcka (DMS) Limited

Independent Auditor's Report to the Members of Slemcka (DMS) Limited

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 ability to continue as a going concern for a period of at least twelve months from when the financial statements were authorised.

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 included in the annual report, other than the financial statements and our auditor’s report 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 there is a material misstatement in the financial statements or a material misstatement of the other information. 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 Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

the Strategic Report and 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 our 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 and the Directors' Report.

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:

 

Slemcka (DMS) Limited

Independent Auditor's Report to the Members of Slemcka (DMS) Limited

adequate accounting records have not been kept by the parent company or its subsidiaries, 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 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 6, 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.

Auditor 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 auditor’s 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.

The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

 

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:

enquiring of management, including obtaining and reviewing supporting documentation, concerning the group's policies and procedures relating to: identifying, evaluating and complying with laws and regulations and whether they were aware of any instances of non-compliance; detecting and responding to the risks of fraud and whether they had knowledge of any actual, suspected or alleged fraud; and the internal controls established to mitigate risks related to fraud or non-compliance with laws and regulations.

 

Slemcka (DMS) Limited

Independent Auditor's Report to the Members of Slemcka (DMS) Limited

we obtained an understanding of the legal and regulatory frameworks applicable to the group based on our understanding of the group, sector experience and discussions with management. The most significant considerations for the group are the Companies Act 2006, Corporate and VAT legislation, Employment Taxes, Health and Safety and the Bribery Act 2010.

discussing amongst the engagement team, who also undertook the audit testing on significant components, to assess how and where fraud might occur in the financial statements and any potential indicators of fraud. As part of this discussion, we identified potential for fraud in the following areas: management override of controls; and revenue recognition, specifically the manipulation of revenue using fraudulent journals.

we tested the appropriateness of accounting journals and other adjustments made in the preparation of the financial statements.

we reviewed the group's accounting policies for non-compliance with relevant standards. Our work also included considering significant accounting estimates for evidence of misstatement or possible bias and testing any significant transactions that appeared to be outside the normal course of business.

 

Our audit procedures were designed to respond to risks of material misstatement in the financial statements, recognising that the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery, misrepresentations or through collusion. There are inherent limitations in the audit procedures performed and the further removed non-compliance with laws and regulations is from events and transactions reflected in the financial statements, the less likely we are to become aware of it.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s 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 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 an auditor’s 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.

 

Slemcka (DMS) Limited

Independent Auditor's Report to the Members of Slemcka (DMS) Limited

......................................
Paul D Johnson FCA (Senior Statutory Auditor)
For and on behalf of Robert Whowell & Partners , Statutory Auditor

Westwood House
78 Loughborough Road
Quorn
Loughborough
Leicestershire
LE12 8DX

2 October 2023

 

Slemcka (DMS) Limited

Consolidated Profit and Loss Account for the Year Ended 31 December 2022

Note

2022
£

2021
£

Turnover

3

12,838,759

15,131,251

Cost of sales

 

(9,483,332)

(11,212,258)

Gross profit

 

3,355,427

3,918,993

Distribution costs

 

(402,109)

(297,340)

Administrative expenses

 

(2,900,404)

(3,195,450)

Other operating income

4

143,645

134,454

Gains on revaluation of investments

 

31,533

200,000

Operating profit

5

228,092

760,657

Other interest receivable and similar income

6

10,642

400

Interest payable and similar expenses

7

(52)

-

   

10,590

400

Profit before tax

 

238,682

761,057

Tax on profit

11

(47,793)

(164,122)

Profit for the financial year

 

190,889

596,935

Profit/(loss) attributable to:

 

Owners of the company

 

190,889

596,935

 

Slemcka (DMS) Limited

Consolidated Statement of Comprehensive Income for the Year Ended 31 December 2022

Note

2022
£

2021
£

Profit for the year

 

190,889

596,935

Unrealised surplus arising on property revaluation

11

315,000

295,000

Deferred tax effect

11

(78,750)

(73,750)

Deferred tax - changes in tax rates on revaluations

 

-

(126,025)

 

236,250

95,225

Total comprehensive income for the year

 

427,139

692,160

Total comprehensive income attributable to:

 

Owners of the company

 

427,139

692,160

 

Slemcka (DMS) Limited

(Registration number: 01314060)
Consolidated Balance Sheet as at 31 December 2022

Note

2022
£

2021
£

Fixed assets

 

Intangible assets

12

1

1

Tangible assets

13

5,345,827

5,050,254

Investment property

14

1,400,000

1,400,000

Other financial assets

16

56,306

24,773

 

6,802,134

6,475,028

Current assets

 

Stocks

17

2,750,641

2,722,547

Debtors

18

4,045,241

4,406,559

Cash at bank and in hand

19

1,970,191

2,104,860

 

8,766,073

9,233,966

Creditors: Amounts falling due within one year

20

(1,223,978)

(1,669,203)

Net current assets

 

7,542,095

7,564,763

Total assets less current liabilities

 

14,344,229

14,039,791

Provisions for liabilities

21

(997,804)

(920,505)

Net assets

 

13,346,425

13,119,286

Capital and reserves

 

Called up share capital

23

11,000

11,000

Revaluation reserve

24

2,166,282

1,930,032

Other reserves

24

586,192

586,192

Retained earnings

24

10,582,951

10,592,062

Equity attributable to owners of the company

 

13,346,425

13,119,286

Shareholders' funds

 

13,346,425

13,119,286

 

Slemcka (DMS) Limited

(Registration number: 01314060)
Consolidated Balance Sheet as at 31 December 2022

Approved and authorised by the Board on 27 September 2023 and signed on its behalf by:
 

.........................................
M. K. Bates
Director

 

Slemcka (DMS) Limited

(Registration number: 01314060)
Balance Sheet as at 31 December 2022

Note

2022
£

2021
£

Fixed assets

 

Investments

15

47,367

47,367

Current assets

 

Debtors

18

305,271

465,255

Cash at bank and in hand

19

2,021

6,138

 

307,292

471,393

Net assets

 

354,659

518,760

Capital and reserves

 

Called up share capital

23

11,000

11,000

Retained earnings

343,659

507,760

Shareholders' funds

 

354,659

518,760

The company made a profit after tax for the financial year of £35,899 (2021 - profit of £149,897).

Approved and authorised by the Board on 27 September 2023 and signed on its behalf by:
 

.........................................
M. K. Bates
Director

 

Slemcka (DMS) Limited

Consolidated Statement of Changes in Equity for the Year Ended 31 December 2022
Equity attributable to the parent company

Share capital
£

Revaluation reserve
£

Non-distributable reserve
£

Retained earnings
£

Total
£

Total equity
£

At 1 January 2022

11,000

1,930,032

586,192

10,592,062

13,119,286

13,119,286

Profit for the year

-

-

-

190,889

190,889

190,889

Other comprehensive income

-

236,250

-

-

236,250

236,250

Total comprehensive income

-

236,250

-

190,889

427,139

427,139

Dividends

-

-

-

(200,000)

(200,000)

(200,000)

At 31 December 2022

11,000

2,166,282

586,192

10,582,951

13,346,425

13,346,425

Share capital
£

Revaluation reserve
£

Non-distributable reserve
£

Retained earnings
£

Total
£

Total equity
£

At 1 January 2021

11,000

1,834,807

443,931

10,287,388

12,577,126

12,577,126

Profit for the year

-

-

-

596,935

596,935

596,935

Other comprehensive income

-

95,225

142,261

(142,261)

95,225

95,225

Total comprehensive income

-

95,225

142,261

454,674

692,160

692,160

Dividends

-

-

-

(150,000)

(150,000)

(150,000)

At 31 December 2021

11,000

1,930,032

586,192

10,592,062

13,119,286

13,119,286

 

Slemcka (DMS) Limited

Statement of Changes in Equity for the Year Ended 31 December 2022

Share capital
£

Retained earnings
£

Total
£

At 1 January 2022

11,000

507,760

518,760

Profit for the year

-

35,899

35,899

Dividends

-

(200,000)

(200,000)

At 31 December 2022

11,000

343,659

354,659

Share capital
£

Retained earnings
£

Total
£

At 1 January 2021

11,000

507,863

518,863

Profit for the year

-

149,897

149,897

Dividends

-

(150,000)

(150,000)

At 31 December 2021

11,000

507,760

518,760

 

Slemcka (DMS) Limited

Consolidated Statement of Cash Flows for the Year Ended 31 December 2022

Note

2022
£

2021
£

Cash flows from operating activities

Profit for the year

 

190,889

596,935

Adjustments to cash flows from non-cash items

 

Depreciation and amortisation

5

50,195

57,527

Changes in fair value of listed investments

 

(31,533)

-

Changes in fair value of investment property

 

-

(200,000)

Profit on disposal of tangible assets

-

(333)

Finance income

6

(10,642)

(400)

Finance costs

7

52

-

Income tax expense

11

47,793

164,122

 

246,754

617,851

Working capital adjustments

 

Increase in stocks

17

(28,094)

(409,677)

Decrease in debtors

18

361,318

714,219

(Decrease)/increase in creditors

20

(423,212)

415,178

Cash generated from operations

 

156,766

1,337,571

Income taxes paid

11

(71,257)

(103,883)

Net cash flow from operating activities

 

85,509

1,233,688

Cash flows from investing activities

 

Interest received

6

10,005

137

Acquisitions of tangible assets

13

(30,768)

(48,396)

Proceeds from sale of tangible assets

 

-

333

Dividend income from financial assets

6

637

263

Net cash flows from investing activities

 

(20,126)

(47,663)

Cash flows from financing activities

 

Interest paid

7

(52)

-

Dividends paid

(200,000)

(150,000)

Net cash flows from financing activities

 

(200,052)

(150,000)

 

Slemcka (DMS) Limited

Consolidated Statement of Cash Flows for the Year Ended 31 December 2022

Note

2022
£

2021
£

Net (decrease)/increase in cash and cash equivalents

 

(134,669)

1,036,025

Cash and cash equivalents at 1 January 2022

 

2,104,860

1,068,835

Cash and cash equivalents at 31 December 2022

 

1,970,191

2,104,860

 

Slemcka (DMS) Limited

Notes to the Financial Statements for the Year Ended 31 December 2022

1

General information

The company is a private company limited by share capital, incorporated in England and Wales.

The address of its registered office is:
Elan House
Park Lane
Castle Vale
Birmingham
B35 6LJ

These financial statements were authorised for issue by the Board on 27 September 2023.

The group's principal activity is that of manufacture, import and distribution of housewares, including bathroom and living products.

The company's principle activity is that of a holding company.

2

Accounting policies

Summary of significant accounting policies and key accounting estimates

The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

Statement of compliance

These financial statements were prepared in accordance with Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland and the Companies Act 2006'.

Basis of preparation

These financial statements have been prepared using the historical cost convention except that as disclosed in the accounting policies certain items are shown at fair value.

The Group's functional and presentational currency is GBP.

Summary of disclosure exemptions

The company is a qualifying entity for the purposes of FRS 102 and has elected to take the exemption under paragraph 1.12(b) of FRS 102 not to present the company statement of cash flows.

 

Slemcka (DMS) Limited

Notes to the Financial Statements for the Year Ended 31 December 2022

Basis of consolidation

The consolidated financial statements present the results of group and its own subsidiaries ("the Group") as if they formed a single entity. Intercompany transactions and balances between group companies are therefore eliminated in full.

The consolidated financial statements incorporate the results of business combinations using the purchase method. In the statement of financial position, the acquiriee's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquiried operations are included in the consolidated statement of comprehensive income from the date on which control is obtained. They are deconsolidated from the date control ceases.

No profit and loss account is presented for the company as permitted by section 408 of the Companies Act 2006. The company made a profit after tax for the financial year of £35,899 (2021 - profit of £149,897).

Revenue recognition

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

Sale of goods
- the group has transferred the significant risks and rewards of ownership to the buyer;
- the group 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 group will receive the consideration due under the transation; and
- the costs incurred or to be incurred in respect of the transaction can be measured reliabily.

Rent receivable
Rental income is recognised on an accruals basis.

Tax

The tax expense for the period comprises current and deferred tax. Tax is recognised in profit and loss account, except that a change attributable to an item of income or expense recognised as other comprehensive income is also recognised directly in other comprehensive income.

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

 

Slemcka (DMS) Limited

Notes to the Financial Statements for the Year Ended 31 December 2022

Deferred tax is recognised in respect of all timing differences between taxable profits and profits reported in the consolidated financial statements.

Unrelieved tax losses and other deferred tax assets are recognised when it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date and that are expected to apply to the reversal of the timing difference, except for revalued land and investment property where the future tax rate that is expected to apply to the sale of the asset is used.

Tangible assets

Tangible fixed assets under the cost model are stated at historical cost less acummulated 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.

Individual freehold and leasehold properties are carried at fair value at the date of the revaluation less any subsequent accumulated depreciation and subsequent impairment losses. Revaluations are undertaken with sufficient regularity to ensure the carrying amount does not differ materially from that which would be determined using fair value at the statement of financial position date.

Fair values are determined from market based evidence normally undertaken by professionally qualified valuers.

Revaluation gains and losses are recognised in the consolidated statement of comprehensive income.

 

Slemcka (DMS) Limited

Notes to the Financial Statements for the Year Ended 31 December 2022

Depreciation

Land is not depreciated. Depreciation on other assets is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight line method.

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 the consolidated statement of comprehensive income.

Depreciation is provided on the following basis:

Asset class

Depreciation method and rate

Freehold property

2% over remaining useful life - revalued

Furntiure, fittings & equipment

20% - 33% straight line

Motor vehicles

25% reducing balance

Plant & machinery

10% - 20% straight line

Investment property

Investment property is carried at fair value determined annually by external valuers and derived from the current market rents and investment property yields for comparable real estate, adjusted if necessary for any difference in the nature, location or condition of the specific asset. No depreciation is provided. Changes in fair value are recognised in the consolidated statement of comprehensive income.

Goodwill

Goodwill arising on the acquisition of an entity represents the excess of the cost of acquisition over the group’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities of the entity recognised at the date of acquisition. Goodwill is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is held in the currency of the acquired entity and revalued to the closing rate at each reporting period date. Goodwill is amortised over its useful life, which shall not exceed ten years if a reliable estimate of the useful life cannot be made.

Investments

Investments in subsidiaries are measured at cost less accumulated impairment.

Investments in listed company shares are remeasured to market value at each statement of financial position date. Gains and losses on remeasurement are recognised in the consolidated statement of comprehensive income for the period.

 

Slemcka (DMS) Limited

Notes to the Financial Statements for the Year Ended 31 December 2022

Cash and cash equivalents

Cash and cash equivalents comprise cash on hand and call deposits, and other short-term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of change in value.

Trade debtors

Short term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at transaction value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.

Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost is determined using the first-in, first-out (FIFO) method.

At each reporting 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 the consolidated profit and loss account.

Creditors

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

Leases

Leases in which substantially all the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases are charged to profit and loss account on a straight-line basis over the period of the lease.

Share capital

Ordinary shares are classified as equity. Equity instruments are measured at the fair value of the cash or other resources received or receivable, net of the direct costs of issuing the equity instruments. If payment is deferred and the time value of money is material, the initial measurement is on a present value basis.

 

Slemcka (DMS) Limited

Notes to the Financial Statements for the Year Ended 31 December 2022

Foreign currency 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 recognised 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 the consolidated profit and loss account.

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.

Defined contribution pension obligation

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

The contributions are recognised as an expense in the consolidated profit and loss account when they fall due. Amounts not paid are shown in other creditors as a liability in the statement of financial position. The assets of the plan are held seperately from the group in independently administered funds.

Research and development

In the research phase of an internal project it is not possible to demonstrate that the project will generate future economic benefits and hence all expenditure on research shall be recognised as an expense when it is incurred. Intangible assets are recognised from the development phase of a project if and only if certain specific criteria are met in order to demonstrate the asset will generate probably future economic benefits and that its cost can be reliably measured. The capitalised development costs are subsequently amortised on a straight line basis over their useful economic lives, which range from three to six years.

If it is not possible to distinguish between the research phase and the development phase of an internal project, the expenditure is treated as if it were all incurred in the research phase only.

 

Slemcka (DMS) Limited

Notes to the Financial Statements for the Year Ended 31 December 2022

3

Turnover

The analysis of the group's turnover for the year by market is as follows:

2022
£

2021
£

UK

12,383,155

14,642,437

Rest of world

455,604

488,814

12,838,759

15,131,251

4

Other operating income

The analysis of the group's other operating income for the year is as follows:

2022
£

2021
£

Government grants

12,000

6,000

Rents

131,645

128,454

143,645

134,454

5

Operating profit

Arrived at after charging/(crediting):

2022
£

2021
£

Depreciation

50,195

57,527

Foreign exchange (gains)/losses

(165,074)

95,097

Operating lease - property

151,970

136,282

Profit on disposal of property, plant and equipment

-

(333)

6

Other interest receivable and similar income

2022
£

2021
£

Interest income on bank deposits

10,005

137

Dividend income from financial assets

637

263

10,642

400

 

Slemcka (DMS) Limited

Notes to the Financial Statements for the Year Ended 31 December 2022

7

Interest payable and similar expenses

2022
£

2021
£

Interest on bank overdrafts and borrowings

52

-

8

Staff costs

The aggregate payroll costs (including directors' remuneration) were as follows:

2022
£

2021
£

Wages and salaries

1,771,128

1,633,353

Social security costs

192,048

178,245

Pension costs, defined contribution scheme

74,420

81,511

2,037,596

1,893,109

The average number of persons employed by the group (including directors) during the year, analysed by category was as follows:

2022
No.

2021
No.

Distribution

16

17

Administration and support

31

31

Management

8

8

55

56

9

Directors' remuneration

The directors' remuneration for the year was as follows:

2022
£

2021
£

Remuneration

273,960

283,573

Contributions paid to money purchase schemes

3,000

2,918

276,960

286,491

 

Slemcka (DMS) Limited

Notes to the Financial Statements for the Year Ended 31 December 2022

During the year the number of directors who were receiving benefits was as follows:

2022
No.

2021
No.

Accruing benefits under money purchase pension scheme

3

3

In respect of the highest paid director:

2022
£

2021
£

Remuneration

111,819

124,994

10

Auditors' remuneration

2022
£

2021
£

Audit of these financial statements

20,000

21,875

Other fees to auditors

Accounting and taxation services

6,500

7,550

26,500

29,425


 

11

Taxation

Tax charged/(credited) in the consolidated profit and loss account

2022
£

2021
£

Current taxation

UK corporation tax

50,679

50,390

UK corporation tax adjustment to prior periods

(1,435)

2,567

49,244

52,957

Deferred taxation

Arising from origination and reversal of timing differences

(2,886)

111,165

Arising from changes in tax rates and laws

1,435

-

Total deferred taxation

(1,451)

111,165

 

Slemcka (DMS) Limited

Notes to the Financial Statements for the Year Ended 31 December 2022

2022
£

2021
£

Tax expense in the income statement

47,793

164,122

The tax on profit before tax for the year is the same as the standard rate of corporation tax in the UK (2021 - the same as the standard rate of corporation tax in the UK) of 19% (2021 - 19%).

The differences are reconciled below:

2022
£

2021
£

Profit before tax

238,682

761,057

Corporation tax at standard rate

45,350

144,601

Effect of expense not deductible in determining taxable profit

7,676

6,540

UK deferred tax (credit)/expense relating to changes in tax rates or laws

(2,528)

60,149

Increase in current tax from adjustment for prior periods

-

2,567

Tax (decrease)/increase from effect of capital allowances and depreciation

(2,705)

4,940

Tax decrease from effect of adjustment in research and development tax credit

-

(54,675)

Total tax charge

47,793

164,122

Deferred tax

Group

Deferred tax assets and liabilities

2022

Asset
£

Liability
£

Accelerated capital allowances

-

166,920

Capital gains

-

830,884

-

997,804

2021

Asset
£

Liability
£

Accelerated capital allowances

-

168,371

Capital gains

-

752,134

-

920,505

 

Slemcka (DMS) Limited

Notes to the Financial Statements for the Year Ended 31 December 2022

Tax relating to items recognised in other comprehensive income or equity - group

2022
£

2021
£

Deferred tax related to items recognised as items of other comprehensive income

78,750

199,775

From 1 April 2023, the rate of corporation tax in the United Kingdom will increase from 19% to 25%. Companies with profits of £50,000 or less will continue to be taxed at 19%, which is a new small profits rate. Where taxable profits are between £50,000 and £250,000, the higher 25% rate will apply but with a marginal relief applying as profits increase.

12

Intangible assets

Group

Goodwill
 £

Total
£

Cost or valuation

At 1 January 2022

1

1

At 31 December 2022

1

1

Amortisation

At 1 January 2022

-

-

At 31 December 2022

-

-

Carrying amount

At 31 December 2022

1

1

At 31 December 2021

1

1

 

Slemcka (DMS) Limited

Notes to the Financial Statements for the Year Ended 31 December 2022

13

Tangible assets

Group

Land and buildings
£

Furniture, fittings and equipment
 £

Motor vehicles
 £

Plant and machinery
£

Total
£

Cost or valuation

At 1 January 2022

4,925,000

471,807

42,032

215,816

5,654,655

Revaluations

315,000

-

-

-

315,000

Additions

-

27,774

-

2,994

30,768

At 31 December 2022

5,240,000

499,581

42,032

218,810

6,000,423

Depreciation

At 1 January 2022

-

373,497

42,032

188,872

604,401

Charge for the year

-

48,212

-

1,983

50,195

At 31 December 2022

-

421,709

42,032

190,855

654,596

Carrying amount

At 31 December 2022

5,240,000

77,872

-

27,955

5,345,827

At 31 December 2021

4,925,000

98,311

-

26,943

5,050,254

Revaluation

Included within the net book value of land and buildings above is £5,240,000 (2021 - £4,925,000) in respect of freehold land and buildings.
The fair value of the group's land & buildings was revalued by Holt Commercial, Chartered Surveyors on 19 January 2023 and is stated on the basis of open market value.
Land and buildings measured on a historical cost basis is £2,325,282 (2021 - £2,325,282).
 

 

Slemcka (DMS) Limited

Notes to the Financial Statements for the Year Ended 31 December 2022

14

Investment properties

Group

2022
£

At 1 January 2022

1,400,000

At 31 December 2022

1,400,000


The investment property was valued by Holt Commercial, Chartered Surveyors on 19 January 2023, and is stated on the basis of open market value. The historical cost and net book value of the investment property amounts to £731,559 (2021 - £731,559).

15

Investments

Group

Details of undertakings

Details of the investments (including principal place of business) in which the group holds 20% or more of the nominal value of any class of share capital are as follows:

Undertaking

Registered office

Holding

Proportion of voting rights and shares held

     

2022

2021

Subsidiary undertakings

Lloyd Pascal & Co. Limited*

Elan House, Park Lane, Castle Vale, Birmingham, B35 6LJ,

Ordinary Deferred

100%
100%

100%
100%

 

England.

     

Lloyd Pascal (Hong Kong) Limited

42nd Floor, Central Plaza, 18 Harbour Road, Wanchai,

Ordinary

100%

100%

 

Hong Kong.

     

House and Homestyle Limited

Elan House, Park Lane, Castle Vale, Birmingham, B35 6LJ,

Ordinary

100%

100%

 

England.

     

* indicates direct investment of the company

 

Slemcka (DMS) Limited

Notes to the Financial Statements for the Year Ended 31 December 2022

Subsidiary undertakings

Lloyd Pascal & Co. Limited

The principal activity of Lloyd Pascal & Co. Limited is import and distribution of bathroom fittings and accessories

Lloyd Pascal (Hong Kong) Limited

The principal activity of Lloyd Pascal (Hong Kong) Limited is the design, import and distribution of bathroom fittings and accessories and other household articles.

House and Homestyle Limited

The principal activity of House and Homestyle Limited is a dormant company

Company

2022
£

2021
£

Investments in subsidiaries

47,367

47,367

Subsidiaries

£

Cost or valuation

At 1 January 2022

47,367

Carrying amount

At 31 December 2022

47,367

At 31 December 2021

47,367

16

Other financial assets

 

Group

Company

2022
£

2021
£

2022
£

2021
£

Non-current financial assets

Investments in listed shares

56,306

24,773

-

-

56,306

24,773

-

-

 

Slemcka (DMS) Limited

Notes to the Financial Statements for the Year Ended 31 December 2022

17

Stocks

 

Group

Company

2022
£

2021
£

2022
£

2021
£

Finished goods and goods for resale

2,351,414

2,722,547

-

-

Goods in transit

399,227

-

-

-

2,750,641

2,722,547

-

-

18

Debtors

 

Group

Company

Current

2022
£

2021
£

2022
£

2021
£

Trade debtors

3,127,352

2,847,162

-

-

Amounts owed by group company

-

-

-

159,984

Other debtors

822,549

1,468,002

305,271

305,271

Prepayments

95,340

91,395

-

-

 

4,045,241

4,406,559

305,271

465,255

19

Cash and cash equivalents

 

Group

Company

2022
£

2021
£

2022
£

2021
£

Cash on hand

750

246

-

-

Cash at bank

957,115

2,084,561

2,021

6,138

Short-term deposits

1,012,326

20,053

-

-

1,970,191

2,104,860

2,021

6,138

 

Slemcka (DMS) Limited

Notes to the Financial Statements for the Year Ended 31 December 2022

20

Creditors

   

Group

Company

Note

2022
£

2021
£

2022
£

2021
£

Due within one year

 

Trade creditors

 

561,903

1,041,594

-

-

Social security and other taxes

 

383,645

366,689

-

-

Outstanding defined contribution pension costs

 

19,587

16,560

-

-

Accruals

 

207,506

171,010

-

-

Income tax liability

11

51,337

73,350

-

-

 

1,223,978

1,669,203

-

-

21

Provisions for liabilities

Group

Deferred tax
£

Total
£

At 1 January 2022

920,505

920,505

Additional provisions

77,299

77,299

At 31 December 2022

997,804

997,804

22

Pension and other schemes

Defined contribution pension scheme

The group operates a defined contribution pension scheme. The pension cost charge for the year represents contributions payable by the group to the scheme and amounted to £74,420 (2021 - £81,511).

Contributions totalling £19,587 (2021 - £16,560) were payable to the scheme at the end of the year and are included in creditors.

 

Slemcka (DMS) Limited

Notes to the Financial Statements for the Year Ended 31 December 2022

23

Share capital

Allotted, called up and fully paid shares

 

2022

2021

 

No.

£

No.

£

Ordinary of £1 each

11,000

11,000

11,000

11,000

         


The ordinary shares carry voting rights but no fixed right to income.

24

Reserves

Group

Capital redemption reserve

The capital redemption reserve represents the nominal value of shares bought back by the company from third parties.

Revaluation reserve

The revaluation reserve represents the cumulative increase in fair value of land and buildings used within the business.

Non-distributable reserve

The non-distributable reserve represents the cumulative increase in fair value of investment property.

Retained earnings

Retained earnings represents cumulative profits and losses retained in current and previous periods.

25

Contingent liabilities

Group

At 31st December 2022 the group has committed outstanding purchase orders with overseas suppliers of £1,517,964. Based on current market conditions the directors believe some of these products may need to be sold at a price below cost, but consider that overall the stock can be cleared at breakeven or better. This clearance position is contingent on several factors including in particular, the future pricing strategies of customers, transportation costs, and the availability of any financial support from the suppliers, all of which are being actively negotiated.

 

Slemcka (DMS) Limited

Notes to the Financial Statements for the Year Ended 31 December 2022

26

Analysis of changes in net debt

Group

At 1 January 2022
£

Financing cash flows
£

At 31 December 2022
£

Cash and cash equivalents

Cash

2,104,860

(134,669)

1,970,191

 

2,104,860

(134,669)

1,970,191

27

Related party transactions

Group

During the year, amounts totalling £7,062 (2021 - £2,717) were paid to a close family member of a director in respect of administrative duties.

During the year gross salary and pension amounting to £243,831 (2021 - £179,946) were paid to close family members of the directors.

The group has taken advantage of the exemption permitted by Section 33 Related Party Disclosures not to provide disclosures of transactions enetered into with other wholly owned members of the group.

Company

Amounts due from directors

2022

At 1 January 2022
£

At 31 December 2022
£

C. M. Bates

Directors' loan

181,241

181,241

     
   

K. J. Bates

Directors' loan

57,186

57,186

     
   

 

 

Slemcka (DMS) Limited

Notes to the Financial Statements for the Year Ended 31 December 2022

2021

At 1 January 2021
£

At 31 December 2021
£

C. M. Bates

Directors' loan

181,241

181,241

     
   

K. J. Bates

Directors' loan

57,186

57,186

     
   

 

Other transactions with directors

Dividends totalling £200,000 (2021 - £150,000) were paid to the directors in the year.

28

Financial instruments

Group

Categorisation of financial instruments

2022
 £

2021
 £

Financial assets measured at fair value through profit and loss account

2,026,497

2,126,516

Financial assets that are debt instruments measured at amortised cost

3,949,901

4,315,164

Financial liabilities measured at amortised cost

(788,996)

(1,229,164)


Financial assets measured at fair value through profit and loss account comprise of listed investments and cash and cash equivalents.

Financial assets that are debt instruments measured at amortised cost comprise trade debtors and other debtors.

Financial liabilities measured at amortised cost comprise trade creditors, other creditors and accruals.

Company

Categorisation of financial instruments

2022
 £

2021
 £

Financial assets measured at fair value through profit and loss account

2,021

6,138

Financial assets that are debt instruments measured at amortised cost

305,271

465,255

 

Slemcka (DMS) Limited

Notes to the Financial Statements for the Year Ended 31 December 2022


Financial assets measured at fair value through profit and loss account comprise of listed investments and cash and cash equivalents.

Financial assets that are debt instruments measured at amortised cost comprise trade debtors, other debtors and amounts owed by group undertakings.

29

Ultimate controlling party

The directors consider there to be no individual ultimate controlling party.