The directors present the strategic report for the year ended 31 March 2023.
Principal activities
The principal activity of the group is the provision of the complete portfolio of digital and strategic marketing services. Using quantified and qualitative insights about a client, its competitors, and its customers, we develop strategic marketing solutions to achieve our client's commercial objectives, including the delivery of integrated marketing tactics and campaigns necessary for executing that strategy.
Our marketing solutions span the following tactics and channels:
Search Engine Optimisation (SEO) - Aimed at maximising the number of organic visitors to a website. The Mediaworks strategic search approach uses quantifiable insight coupled with creativity to develop unique SEO campaigns that are right for our clients, their brands, and their customers.
Website Design & Development - Our in-house team of creative professionals design and develop imaginative, effective, secure, and resilient websites and web applications using HTML, CSS, React, and other web languages.
Performance Marketing - This refers to all "paid advertising" channels including paid search (shown at the top of a search engine) as well as programmatic advertising displayed on 3rd party publishers and social advertising shown on platforms such as Facebook and Instagram. Targeted based on the audience behaviour and demographics, these campaigns focus on driving brand exposure, traffic, revenue, and leads.
Media Planning and Buying - We combine online and offline data to define an audience-led media strategy, maximising reach and frequency of messaging across all digital channels, effectively targeting customers from exposure to conversion.
Conversion Rate Optimisation (CRO) - The process for increasing the percentage of visitors to a website that convert into customers. We use an extensive range of tools and testing methods to analyse the efficacy of a website in relation to its customers and objectives, helping clients to fine-tune the little things that increase sales, enquiries, and sign ups.
Public Relation (PR) - Tailored digital PR campaigns that focus on driving brand awareness with the right influencers and top-tier publications, through thought-leading and newsworthy content.
Video - From video strategy to 3D animation and motion graphics, our full video content services help business to create visual assets that allow them to grab attention to educate audiences and drive sales.
The directors report turnover for the year of £10,058,854 (2022: £8,993,403) and EBITDA of £719,590 (2022: £1,583,237). The balance sheet as at 31 March 2023 shows net assets of £2,446,972 (2022: £3,009,417).
The demand within the market for data-led digital solutions continues to grow, with digital channels representing the majority proportion of the UK’s total advertising spend and this share of wallet is predicted to continue to expand.
To support this growth, the group has continued its focus on the recruitment and development of talented individuals across the agency, growing average headcount from 161 to 170 during the year and cementing our market position as one of the leading digital agencies in the North.
Geographically, the agency has now firmly established its presence across the North of England and Scotland, with physical offices in Gateshead, Leeds, Manchester and Edinburgh, offering wider access to talent across these territories.
We have continued to focus on delivering best-in-class, integrated marketing strategies and solutions which align to the commercial goals of our clients. The quality of service delivery and performance of our campaigns have received recognition through a variety of industry awards and accreditations.
The group believes firmly in continuous innovation and has continued to develop its product offering to align with the needs of our growing client portfolio, and to ensure that we remain capable of delivering a market-leading, 'full service' digital transformation solution to our partners.
We have also continued to invest in further phases of development and adoption of our propriety data warehouse and analytical toolset, featuring powerful artificial intelligence, which we have deployed to drive even greater internal efficiencies and powerful insight for our clients.
The significant investments made by the group in expanding our regional office footprint, headcount and software tools have resulted in a dilution of operating profits, despite the growth in turnover. However, the directors are confident that these investments will provide the infrastructure necessary to support the future scale of the agency.
With strong links to a network of excellent local universities, we believe Mediaworks employs some of the best digital and creative minds in the industry. Along with analytical experts, our delivery team boasts campaign strategists, project managers, in-house developers, designers, videographers and content creators, who add value with a bespoke approach to each campaign. It is vitally important for us to attract, train, and retain high calibre and motivated employees. We are committed to creating opportunities for apprentices and graduates to enter the digital sector and providing career pathways for our people to flourish and reach their full potential.
In summary, the group has continued to deliver strong financial and operational performance. The directors are confident that the agency can maintain the growth in both our client portfolio and financial results as we enter our new financial year.
The group's principal financial instruments comprise cash and cash equivalents. Other financial assets and liabilities, such as trade creditors and trade debtors, arise directly from the group's operating activities.
The main risks associated with the group's financial assets and liabilities are set out below:
Interest rate risk
The group retains surplus cash in its bank current account and a floating rate interest bank deposit account. The group's bank loan is subject to both a fixed and floating interest rate. The group's income and expense is therefore affected by movements in interest rates, but not materially. The group does not undertake any hedging activity
Liquidity risk
The group aims to mitigate liquidity risk by managing cash generated by its operations.
Foreign currency risk
The group does not have any foreign currency transactions (all transactions are denominated in sterling and therefore is not exposed to any foreign currency risk).
The group's key financial and other performance indicators during the year were as follows:
| Unit | 2023 | 2022 |
Turnover | £ | 10,058,854 | 8,993,403 |
Average debtor days during the year | Days | 56 | 55 |
Gross Margin | % | 71 | 72 |
On behalf of the board
The directors present their annual report and financial statements for the year ended 31 March 2023.
The results for the year are set out on page 9.
Ordinary dividends were paid amounting to £155,000. The directors do not recommend payment of a further dividend.
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
Data analytics capability is an area that we have invested heavily into during recent years and shall continue to do so, developing our people, systems and processes to deliver best-in-class insight for our clients through intelligent and automated analysis of their data, alongside relevant third-party data sets.
With such strong technical capabilities and resource in place, the directors believe we are well positioned to capitalise on the market demand for digital services and we are confident that we can achieve the ambitious growth forecasts set out in our current business plan.
Whilst continuing to develop our product range, we will aim to grow our market share of top tier clients across the North of England, Scotland and Ireland, alongside major national brands and blue-chip businesses in our target sectors.
Sumer Auditco Limited were appointed as auditor to the group and in accordance with section 485 of the Companies Act 2006, a resolution proposing that they be re-appointed will be put at a General Meeting.
The financial statements have been prepared on a going concern basis.
The group meets its day to day working capital requirements through cash generated from operations and bank loans. At the year end the group had net assets of £2,447k including cash at bank of £1,368k. The group is subject to a debenture securing its parent bank loan of £550k.
The group's forecasts and projections for the next twelve months show that the group should have sufficient headroom from these facilities to be able to continue in operation existence for that period, taking into account reasonable possible changes in trading performance and the potential impact on the business of possible future scenarios arising from the increases in inflation and the impact of these increases on the wider economy.
Although the forecast prepared, taking account of the matters above, supports the ability of the group to remain a going concern and to be able to trade and meet it debts as they fall due, the full impact of increasing inflation and interest rates on the wider community and the underlying trading assumptions used in forecasting are extremely judgmental and difficult to predict and could be subject to significant variation.
However, based on the factors set out above, the directors believe that there is no material uncertainty in relation to going concern and that the parent company and group has adequate financial resources to continue in operational existence for at least twelve months from the date of signing the financial statements and therefore the directors believe it remains appropriate to prepare the financial statements on a going concern basis.
This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.
We have audited the financial statements of Mediaworks Holdings Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 March 2023 which comprise the group profit and loss account, the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows and notes to the financial statements, including 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).
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's responsibilities for the audit of the financial statements section of our report. We are independent of the group and parent company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the group's and parent company’s ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
Other information
The other information comprises the information included in the annual report other than the financial statements and our auditor's 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.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our 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.
In the light of the knowledge and understanding of the group and the parent company and their 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 by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or
the parent company financial statements are not in agreement with the accounting records and returns; or
certain disclosures of directors' remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
As explained more fully in the directors' responsibilities statement, 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 parent company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the parent company or to cease operations, or have no realistic alternative but to do so.
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.
Discussions with and enquiries of management and those charged with governance were held with a view to identifying those laws and regulations that could be expected to have a material impact on the financial statements. During the engagement team briefing, the outcomes of these discussions and enquiries were shared with the team, as well as consideration as to where and how fraud may occur in the entity.
The following laws and regulations were identified as being of significance to the entity:
Those laws and regulations considered to have a direct effect on the financial statements including UK financial reporting standards, Company Law, Tax and Pensions legislation, and distributable profits legislation.
Those laws and regulations for which non-compliance may be fundamental to the operating aspects of the business and therefore may have a material effect on the financial statements include health and safety legislation and General Data Protection Regulations ("GDPR").
Audit procedures undertaken in response to the potential risks relating to irregularities (which include fraud and non-compliance with laws and regulations) comprised of: inquiries of management and those charged with governance as to whether the entity complies with such laws and regulations; enquiries with the same concerning any actual or potential litigation or claims; inspection of relevant legal correspondence; review of board minutes; testing the appropriateness of journal entries; and the performance of analytical review to identify unexpected movements in account balances which may be indicative of fraud.
No instances of material non-compliance were identified. However, the likelihood of detecting irregularities, including fraud, is limited by the inherent difficulty in detecting irregularities, the effectiveness of the entity's controls, and the nature, timing and extent of the audit procedures performed. Irregularities that result from fraud might be inherently more difficult to detect than irregularities that result from error. As explained above, there is an unavoidable risk that material misstatements may not be detected, even though the audit has been planned and performed in accordance with ISAs (UK).
A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://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.
These financial statements have been prepared in accordance with the provisions relating to medium-sized groups.
As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £155,075 (2022 - £407,374 profit).
Mediaworks Holdings Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is Floor 2 Honeycomb, The Watermark, Gateshead, Tyne and Wear, NE11 PSZ.
The group consists of Mediaworks Holdings Limited and all of its subsidiaries, detailed in 12.
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
Mediaworks Holdings Limited, as an individual entity, meets the definition of a qualifying entity per FRS 102 and has taken advantage of the exemption available in paragraph 1.12 of FRS 102 from presenting a company-only statement of cash flows. These consolidated financial statements include a consolidated statement of cash flows which include the cash flows of Mediaworks Holdings Limited.
As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £155,075 (2022 - £407,374).
The consolidated group financial statements consist of the financial statements of the parent company Mediaworks Holdings Limited together with all entities controlled by the parent company (its subsidiaries) and the group’s share of its interests in joint ventures and associates.
All financial statements are made up to 31 March 2023. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.
All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.
The financial statements have been prepared on a going concern basis.
The group meets its day to day working capital requirements through cash generated from operations and bank loans. At the year end the group had net assets of £2,447k including cash at bank of £1,368k. The group is subject to a debenture securing its parent bank loan of £550k.
The group's forecasts and projections for the next twelve months show that the group should have sufficient headroom from these facilities to be able to continue in operation existence for that period, taking into account reasonable possible changes in trading performance and the potential impact on the business of possible future scenarios arising from the increases in inflation and the impact of these increases on the wider economy.
Although the forecast prepared, taking account of the matters above, supports the ability of the group to remain a going concern and to be able to trade and meet it debts as they fall due, the full impact of increasing inflation and interest rates on the wider community and the underlying trading assumptions used in forecasting are extremely judgmental and difficult to predict and could be subject to significant variation.
However, based on the factors set out above, the directors believe that there is no material uncertainty in relation to going concern and that the parent company and group has adequate financial resources to continue in operational existence for at least twelve months from the date of signing the financial statements and therefore the directors believe it remains appropriate to prepare the financial statements on a going concern basis.
Turnover comprises the fair value of the consideration received or receivable for the provision of services in the ordinary course of the group’s activities. Turnover is shown net of value added tax, returns, rebates and discounts.
Project based revenue is recognised in the period in which the services are provided in accordance with the stage of completion of the contract.
Recurring revenue is recognised each month over the period of the contract.
The group recognises revenue when the amount of revenue can be reliably measured, it is probable that future economic benefits will flow to the entity and specific criteria have been met for each of the group’s activities.
Research expenditure is written off against profits in the year in which it is incurred. Identifiable development expenditure is capitalised to the extent that the technical, commercial and financial feasibility can be demonstrated.
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in the profit and loss account.
Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available.
In the parent company financial statements, investments in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.
A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
At each reporting period end date, the group reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any).
The group has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the group's balance sheet when the group becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset and the net amounts presented in the financial statements when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the group transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the group after deducting all of its liabilities.
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.
Equity instruments issued by the group are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the group.
The tax expense represents the sum of the tax currently payable and deferred tax.
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset if, and only if, there is a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received, if considered material to the financial statements.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
Equity-settled share-based payments are measured at fair value at the date of grant by reference to the fair
value of the equity instruments granted. The fair value determined at the grant date is expensed on a straight-line basis over the vesting period, based on the estimate of shares that will eventually vest, if considered material to the financial statements. A corresponding adjustment is made to equity. If the vesting period can not be predetermined then no expense is recognised until the options are exercised.
The expense in relation to options over the parent company’s shares granted to employees of a subsidiary is recognised by the company as a capital contribution, and presented as an increase in the company’s investment in that subsidiary.
Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.
Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.
A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.
In the application of the group’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.
The cost of internally generated assets is capitalised as an intangible asset where it is determined by management that the ability to develop the assets is technically feasible, will be completed and that the asset will generate economic benefit.
In assessing whether there have been any indicators of impairment in assets, the directors have considered both external and internal sources of information such as market conditions and experience of recoverability. There have been no indicators of impairments identified during the current financial year.
The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.
The group depreciates tangible fixed assets and amortises intangible fixed assets over their estimated useful lives. The estimation of the useful lives of assets is based on historic performance as well as expectations about future use and therefore requires estimates and assumptions to be applied by management.
Judgement is applied by management when determining the residual values of tangible and intangible fixed assets. When determining the residual value management aim to assess the amount that the group would currently obtain for the disposal of the asset, if it were already of the condition expected at the end of its useful economic life.
The carrying amount of intangible fixed assets at the reporting date was £3,611,287 (2022 - £4,080,023) and the carrying amount of tangible fixed assets at the reporting date was £677,243 (2022 - £490,452).
The group establishes a provision for trade debts that are estimated not to be recoverable. When assessing the recoverability the directors consider factors such as the ageing of debtors, past experience of recoverability, and the credit profile of individual customers. The carrying value of this provision is £148,550 (2022 - £18,790).
Grants income includes amounts of £56,305 (2022 - £24,713) received in relation to rates refunds from local authorities as well as education and skills apprenticeship grants and £nil (2022 - £4,736) in relation to the coronavirus job retention scheme.
The average monthly number of persons (including directors) employed by the group and company during the year was:
Their aggregate remuneration comprised:
The actual charge for the year can be reconciled to the expected (credit)/charge for the year based on the profit or loss and the standard rate of tax as follows:
Dividends for the period were approved by shareholders before the year end and have therefore been recognised in the financial statements. At reporting date dividends of £40,000 were yet to be paid and are included within accruals.
The carrying value of land and buildings comprises:
Details of the company's subsidiaries at 31 March 2023 are as follows:
Registered office addresses (all UK unless otherwise indicated):
Subsidiary undertakings
The nature of all subsidiaries is the provision of the complete portfolio of digital marketing services.
* MWI Agency Limited ceased trading with effect from 31 October 2022, Results up to the date of cessation are included in these consolidated financial statements. The company was dissolved after the year end on 29 July 2023.
Bank loans are secured by a debenture over the parent company and each of the subsidiary undertakings. The loans attract a marginal interest rate of 2.75% above the Bank of England base rate and are repayable over equal instalments until September 2024.
Yorkshire Bank hold a fixed and floating charge over the assets of the company along with a cross guarantee with Mediaworks Holdings and group companies, securing the group's borrowings.
The preference shares are redeemable at the option of the company and bear a fixed cumulative dividend of 10% calculated annually.
The following are the major deferred tax liabilities and assets recognised by the group and company, and movements thereon:
A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.
Contributions totalling £29,313 (2022 - £22,964) were payable to the scheme at the end of the year and are included in creditors.
The parent company operates an EMI share option plan.
The participating employees in the subsidiary company, Mediaworks UK Limited, have been granted options to acquire Ordinary D 1p shares in the parent company at an exercise prices of 13p-27p per share. The options can only be exercised once specific criteria are met, and are subject to the terms stipulated in the EMI share option contract.
During the year 101,648 options were granted and 36,177 lapsed.
At the year end there have been 317,825 (2022 - 252,354) options granted to acquire Ordinary D 1p shares, which are yet to vest. The weighted average exercise price of options at year end was 17p (2022 - 13p).
Rights, preferences, and restrictions.
The ordinary, A, B, C, and D ordinary shares rank pari passu.
At the reporting end date the group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
During the year the group entered into the following transactions with related parties:
The following amounts were outstanding at the reporting end date:
The following amounts were outstanding at the reporting end date:
B C Jacobson is the controlling party by virtue of his interest in the issued share capital of the parent company.