Company registration number 11810776 (England and Wales)
EXCOOL HOLDINGS LIMITED
ANNUAL REPORT AND CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
EXCOOL HOLDINGS LIMITED
COMPANY INFORMATION
Directors
Mr D R Williams
Mr C Banton
(Appointed 1 March 2023)
Company number
11810776
Registered office
The Oakley
Kidderminster Road
Droitwich
Worcestershire
WR9 9AY
Auditor
Ormerod Rutter Limited
The Oakley
Kidderminster Road
Droitwich
Worcestershire
WR9 9AY
EXCOOL HOLDINGS LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2 - 3
Independent auditor's report
4 - 6
Group statement of comprehensive income
7
Group balance sheet
8
Company balance sheet
9
Group statement of changes in equity
10
Company statement of changes in equity
11
Group statement of cash flows
12
Notes to the financial statements
13 - 35
EXCOOL HOLDINGS LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2023
- 1 -

The directors present the strategic report for the year ended 31 March 2023.

Review of the business

This is the fourth period of trade for Excool Holdings Limited since the company was incorporated on 6 February 2019.

 

The main trading entity within the group is 86.5% subsidiary company Excool Limited.

 

In summary the group has achieved a profit before taxation of £3,765,133 compared to £732,004 in the prior period of trade, from turnover of £23,516,892 in 2023 and £13,703,976 in 2022.

 

Cash funds held as at 31 March 2023 have decreased from £11,212,534 to £6,809,302.

 

The group balance sheet shows net assets of £15,677,454 as at 31 March 2023 (2022: £12,982,113).

 

The director is happy with the results and the position of the group at the year end.

Principal risks and uncertainties

The director considers that the main principal risks and uncertainties of the company are those relating to the main trading subsidiary company’s competition within the industry sector and the current economic environment. All of these risks are monitored regularly by the director to ensure that the risks are minimised, particularly in terms of industry specific news.

Development and performance

Excool were delighted to be presented with The Queen’s Award in August 2022, for International Trade by the Princess Royal who also opened the new Excool Zero Factory in Bromsgrove.

 

This award is a great honour for Excool and reflects the hard work and dedication from the entire team since 2010.

 

For Excool, international exports have been a key business objective in the past five years with a landmark opening of offices in South Carolina, USA, with further expansion into South East Asia, namely Singapore in 2023.

 

The business has demonstrated continual forward thinking to ensure the most efficient data centre cooling is manufactured. This has been achieved through dedicated Research and Development, one of the cornerstones of Excool's culture.

Key performance indicators

The director considers the key performance indicators to be gross profit margins, cash balances and net assets position on the balance sheet. Gross profit margin for 2023 is 40% (2022: 42%).

 

The group endeavours to pay its suppliers within the agreed upon credit terms and as a consequence the company monitors their actual creditor days. Creditors days calculated on an average basis at 31 March 2023 were 80 days (2022: 109 days). The average calculation basis will always be distorted by the impact of the timing of trading activity.

On behalf of the board

Mr D R Williams
Director
5 October 2023
EXCOOL HOLDINGS LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2023
- 2 -

The directors present their annual report and financial statements for the year ended 31 March 2023.

Principal activities

The principal activity of the company was that of a holding company.

 

The main principle activity of the subsidiary undertakings was that of providing data centre cooling systems.

Results and dividends

The results for the year are set out on page 7.

No ordinary dividends were paid in the parent company during the financial year. The directors do not recommend payment of a further dividend.

Directors

The directors who held office during the year and up to the date of signature of the financial statements were as follows:

Mr D R Williams
Mr C Banton
(Appointed 1 March 2023)
Directors' insurance

The group maintains insurance policies on behalf of the director against liabilities arsing from negligence, breach of duty and breach of trust in relation to the company.

Financial instruments
Liquidity risk

The group manages its cash and borrowing requirements in order to maximise interest income and minimise interest expense, whilst ensuring the group has sufficient liquid resources to meet the operating needs of the business.

Foreign currency risk

The group’s principal foreign currency exposures arise from trading with overseas companies. Group policy permits but does not demand that these exposures may be hedged in order to fix the cost in sterling. This hedging activity involves the use of foreign exchange forward contracts.

Credit risk

Investments of cash surpluses, borrowings and derivative instruments are made through banks and companies which must fulfil credit rating criteria approved by the Board.

 

All customers who wish to trade on credit terms are subject to credit verification procedures. Trade debtors are monitored on an ongoing basis and provision is made for doubtful debts where necessary.

Research and development

The group has carried out research and development activities during the year and will submit a claim for research and development tax credits.

Future developments

The director aims to maintain the same management policies which have resulted in the group's performance to date.

Auditor

The auditor, Ormerod Rutter Limited, is deemed to be reappointed under section 478(2) of the Companies Act 2006.

EXCOOL HOLDINGS LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 3 -
Statement of directors' responsibilities

The directors are responsible 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 company, and of the profit or loss of the group for that period. In preparing these financial statements, the directors are required to:

 

 

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the group’s and company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and 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 company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Statement of disclosure to auditor

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the auditor of the company is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the auditor of the company is aware of that information.

On behalf of the board
Mr D R Williams
Director
5 October 2023
EXCOOL HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF EXCOOL HOLDINGS LIMITED
- 4 -
Opinion

We have audited the financial statements of Excool Holdings Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 March 2023 which comprise 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).

In our opinion the financial statements:

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:

EXCOOL HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF EXCOOL HOLDINGS LIMITED
- 5 -
Matters on which we are required to report by exception

In the light of the knowledge and understanding of the group and the parent company and 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:

Responsibilities of directors

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.

Auditor's 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.

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

 

Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:

EXCOOL HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF EXCOOL HOLDINGS LIMITED
- 6 -

We assessed the susceptibility of the company's financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:

 

To address the risk of fraud through management bias and override of controls, we:

 

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:

 

There are inherent limitations in the audit procedures described above. We are less likely to become aware of instances of non-compliance with laws and regulations that are not closely related to events and transactions reflected in the financial statements. Also, 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 or intentional misrepresentations, or through collusion.

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.

Garry Rutter FCA (Senior Statutory Auditor)
For and on behalf of Ormerod Rutter Limited
5 October 2023
Chartered Accountants
Statutory Auditor
The Oakley
Kidderminster Road
Droitwich
Worcestershire
WR9 9AY
EXCOOL HOLDINGS LIMITED
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2023
- 7 -
2023
2022
Notes
£
£
Turnover
3
23,516,892
13,703,976
Cost of sales
(14,154,096)
(7,947,228)
Gross profit
9,362,796
5,756,748
Administrative expenses
(6,163,758)
(5,135,697)
Other operating income
430,000
149,491
Operating profit
4
3,629,038
770,542
Share of results of associates and joint ventures
(17,020)
106,333
Interest receivable and similar income
7
32,925
-
0
Interest payable and similar expenses
8
(73,957)
(17,659)
Fair value gains and losses on foreign exchange contracts
9
194,147
(127,212)
Profit before taxation
3,765,133
732,004
Tax on profit
10
(918,720)
204,674
Profit for the financial year
29
2,846,413
936,678
Profit for the financial year is attributable to:
- Owner of the parent company
2,370,840
807,107
- Non-controlling interests
475,573
129,571
2,846,413
936,678
Total comprehensive income for the year is attributable to:
- Owner of the parent company
2,370,840
807,107
- Non-controlling interests
475,573
129,571
2,846,413
936,678
EXCOOL HOLDINGS LIMITED
GROUP BALANCE SHEET
AS AT
31 MARCH 2023
31 March 2023
- 8 -
2023
2022
Notes
£
£
£
£
Fixed assets
Goodwill
12
809,447
956,620
Tangible assets
13
1,057,267
1,100,810
Investments
14
307,376
304,790
2,174,090
2,362,220
Current assets
Stocks
18
3,633,865
3,260,573
Debtors
20
17,479,894
4,860,305
Cash at bank and in hand
6,809,302
11,212,534
27,923,061
19,333,412
Creditors: amounts falling due within one year
21
(13,756,581)
(8,097,996)
Net current assets
14,166,480
11,235,416
Total assets less current liabilities
16,340,570
13,597,636
Creditors: amounts falling due after more than one year
22
(500,224)
(615,523)
Provisions for liabilities
Deferred tax liability
26
162,892
-
0
(162,892)
-
Net assets
15,677,454
12,982,113
Capital and reserves
Called up share capital
28
243
243
Profit and loss reserves
29
12,666,972
10,126,534
Equity attributable to owner of the parent company
12,667,215
10,126,777
Non-controlling interests
3,010,239
2,855,336
15,677,454
12,982,113
The financial statements were approved by the board of directors and authorised for issue on 5 October 2023 and are signed on its behalf by:
05 October 2023
Mr D R Williams
Director
Company registration number 11810776 (England and Wales)
EXCOOL HOLDINGS LIMITED
COMPANY BALANCE SHEET
AS AT 31 MARCH 2023
31 March 2023
- 9 -
2023
2022
Notes
£
£
£
£
Fixed assets
Investments
14
409,129
309,129
Current assets
Debtors
20
11,284,232
10,781,465
Cash at bank and in hand
58,103
42,473
11,342,335
10,823,938
Creditors: amounts falling due within one year
21
(712,270)
(119,111)
Net current assets
10,630,065
10,704,827
Net assets
11,039,194
11,013,956
Capital and reserves
Called up share capital
28
243
243
Profit and loss reserves
29
11,038,951
11,013,713
Total equity
11,039,194
11,013,956

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 £25,238 (2022 - £3,007,347 profit).

The financial statements were approved by the board of directors and authorised for issue on 5 October 2023 and are signed on its behalf by:
05 October 2023
Mr D R Williams
Director
Company registration number 11810776 (England and Wales)
EXCOOL HOLDINGS LIMITED
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2023
- 10 -
Share capital
Profit and loss reserves
Total controlling interest
Non-controlling interest
Total
Notes
£
£
£
£
£
Balance at 1 April 2021
243
9,267,686
9,267,929
3,135,506
12,403,435
Year ended 31 March 2022:
Profit and total comprehensive income for the year
-
807,107
807,107
129,571
936,678
Dividends
11
-
(8,000)
(8,000)
(210,000)
(218,000)
Purchase of shares in subsidiary from non-controlling interest
-
59,741
59,741
(199,741)
(140,000)
Balance at 31 March 2022
243
10,126,534
10,126,777
2,855,336
12,982,113
Year ended 31 March 2023:
Profit and total comprehensive income for the year
-
2,370,840
2,370,840
475,573
2,846,413
Dividends
11
-
-
-
(51,072)
(51,072)
Purchase of shares in subsidiary from non-controlling interest
-
169,598
169,598
(269,598)
(100,000)
Balance at 31 March 2023
243
12,666,972
12,667,215
3,010,239
15,677,454
EXCOOL HOLDINGS LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2023
- 11 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 April 2021
243
8,014,366
8,014,609
Year ended 31 March 2022:
Profit and total comprehensive income for the year
-
3,007,347
3,007,347
Dividends
11
-
(8,000)
(8,000)
Balance at 31 March 2022
243
11,013,713
11,013,956
Year ended 31 March 2023:
Profit and total comprehensive income
-
25,238
25,238
Balance at 31 March 2023
243
11,038,951
11,039,194
EXCOOL HOLDINGS LIMITED
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2023
- 12 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash absorbed by operations
34
(5,936,048)
(3,585,673)
Interest paid
(28,275)
(13,995)
Income taxes paid
(242)
(544,000)
Net cash outflow from operating activities
(5,964,565)
(4,143,668)
Investing activities
Purchase of tangible fixed assets
(397,168)
(606,685)
Proceeds from disposal of tangible fixed assets
244,602
156,792
Proceeds from disposal of joint ventures
(19,606)
810
Repayment of loans
49,409
157,892
Interest received
32,925
-
0
Net cash used in investing activities
(89,838)
(291,191)
Financing activities
Net impact of bank loans
1,903,654
200,000
Payment of finance leases obligations
(101,411)
423,722
Purchase of shares in subsidiary from non-controlling interest
(100,000)
(140,000)
Dividends paid to equity shareholders
-
0
(8,000)
Dividends paid to non-controlling interests
(51,072)
(210,000)
Net cash generated from financing activities
1,651,171
265,722
Net decrease in cash and cash equivalents
(4,403,232)
(4,169,137)
Cash and cash equivalents at beginning of year
11,212,534
15,381,671
Cash and cash equivalents at end of year
6,809,302
11,212,534
EXCOOL HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
- 13 -
1
Accounting policies
Company information

Excool Holdings Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is The Oakley, Kidderminster Road, Droitwich, Worcestershire, WR9 9AY. The company trades from its business premises located at Cooper House, Corbett Business Park, Shaw Lane, Stoke Prior, Bromsgrove, Worcestershire, B60 4EA.

 

The group consists of Excool Holdings Limited and all of its subsidiaries.

1.1
Accounting convention

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.

1.2
Business combinations

In the parent company financial statements, the cost of a business combination is the fair value at the acquisition date of the assets given, equity instruments issued and liabilities incurred or assumed, plus costs directly attributable to the business combination. The excess of the cost of a business combination over the fair value of the identifiable assets, liabilities and contingent liabilities acquired is recognised as goodwill. The cost of the combination includes the estimated amount of contingent consideration that is probable and can be measured reliably, and is adjusted for changes in contingent consideration after the acquisition date. Provisional fair values recognised for business combinations in previous periods are adjusted retrospectively for final fair values determined in the 12 months following the acquisition date. Investments in subsidiaries, joint ventures and associates are accounted for at cost less impairment.

 

Deferred tax is recognised on differences between the value of assets (other than goodwill) and liabilities recognised in a business combination accounted for using the purchase method and the amounts that can be deducted or assessed for tax, considering the manner in which the carrying amount of the asset or liability is expected to be recovered or settled. The deferred tax recognised is adjusted against goodwill or negative goodwill.

1.3
Basis of consolidation

The consolidated group financial statements consist of the financial statements of the parent company Excool 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.

EXCOOL HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 14 -

Subsidiary companies Excool Limited, Ecoairbox Limited, Excool China Limited and Excool North America Limited have been included in the group financial statements using the purchase method of accounting. Accordingly, the group profit and loss account and statement of cash flows include the results and cash flows of Excool Limited along with indirect subsidiary undertakings Greenbox GBX Limited, Greenbox OEM Limited, Excool Hong Kong Limited and Excool Inc. Subsidiary undertakings Excool China Limited and Excool North America Limited have not traded since they were acquired on 1 January 2020. When the subsidiary companies were acquired in the comparative period, the purchase consideration of these subsidiaries has been allocated to the assets and liabilities on the basis of fair value at the date of acquisition.

Entities other than subsidiary undertakings or joint ventures, in which the group has a participating interest and over whose operating and financial policies the group exercises a significant influence, are treated as associates. In the group financial statements, associates are accounted for using the equity method. In the comparative year this included the investment in Excool GmbH which was held by subsidiary undertaking Excool Limited and acquired by the group indirectly through the investment in Excool Limited. The investment in Excool GmbH was fully impaired in the previous period after the company was liquidated on 4 March 2020.

Investments in joint ventures and associates are carried in the group balance sheet at cost plus post-acquisition changes in the group’s share of the net assets of the entity, less any impairment in value. The carrying values of investments in joint ventures and associates include acquired goodwill.

 

If the group’s share of losses in a joint venture or associate equals or exceeds its investment in the joint venture or associate, the group does not recognise further losses unless it has incurred obligations to do so or has made payments on behalf of the joint venture or associate.

 

Unrealised gains arising from transactions with joint ventures and associates are eliminated to the extent of the group’s interest in the entity.

1.4
Going concern

At the time of approving the financial statements, the directors have a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

1.5
Turnover

Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT.

Revenue from the provision of services is recognised by reference to the stage of completion, when the costs incurred and costs to complete can be estimated reliably.

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

EXCOOL HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 15 -

Construction contracts

Where the outcome of a construction contract can be estimated reliably, revenue and costs are recognised by reference to the stage of completion of the contract activity at the reporting end date. Variations in contract work, claims and incentive payments are included to the extent that the amount can be measured reliably and its receipt is considered probable.

 

When it is probable that total contract costs will exceed total contract turnover, the expected loss is recognised as an expense immediately.

 

Where the outcome of a construction contract cannot be estimated reliably, contract revenue is recognised to the extent of contract costs incurred where it is probable that they will be recoverable. Contract costs are recognised as expenses in the period in which they are incurred. When costs incurred in securing a contract are recognised as an expense in the period in which they are incurred, they are not included in contract costs if the contract is obtained in a subsequent period.

 

The “percentage of completion method” is used to determine the appropriate amount to recognise in a given period. The stage of completion is measured by the proportion of contract costs incurred for work performed to date compared to the estimated total contract costs. Costs incurred in the year in connection with future activity on a contract are excluded from contract costs in determining the stage of completion. These costs are presented as stocks, prepayments or other assets depending on their nature, and provided it is probable they will be recovered.

1.6
Intangible fixed assets - goodwill

Goodwill arose from the hive up of net assets in Excool Limited and represents the excess of the cost of acquisition of a business over the fair value of net assets acquired. Goodwill is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is 10 years.

 

For the purposes of impairment testing, goodwill is allocated to the cash-generating units expected to benefit from the acquisition. Cash-generating units to which goodwill has been allocated are tested for impairment at least annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit.

Where the acquirers interest in the net amount of the identifiable assets, liabilities and provisions for contingent liabilities exceeds the cost of the business combination ('negative goodwill') it shall recognise and separately disclose the resulting excess on the face of the statement of financial position on the acquisition date, immediately below goodwill. The acquirer shall recognise subsequently the excess up to the fair value of the non-monetary assets acquired in profit and loss in which the non-monetary assets are recovered. Any excess exceeding the fair value of the assets acquired shall be recognised in profit and loss in the periods expected to be benefited.

 

Negative goodwill has been recognised to the profit and loss account in full in the current financial period.

EXCOOL HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 16 -
1.7
Tangible fixed assets

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Plant and equipment
15% reducing balance
Fixtures and fittings
15% reducing balance
Computers
15% reducing balance and 33% straight line
Motor vehicles
25% reducing balance

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.

1.8
Fixed asset investments

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.

An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The group considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.

 

Investments in associates are initially recognised at the transaction price (including transaction costs) and are subsequently adjusted to reflect the group’s share of the profit or loss, other comprehensive income and equity of the associate using the equity method. Any difference between the cost of acquisition and the share of the fair value of the net identifiable assets of the associate on acquisition is recognised as goodwill. Any unamortised balance of goodwill is included in the carrying value of the investment in associates.

 

Losses in excess of the carrying amount of an investment in an associate are recorded as a provision only when the company has incurred legal or constructive obligations or has made payments on behalf of the associate.

 

In the parent company financial statements, investments in associates are accounted for at cost less impairment.

Entities in which the group has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.

EXCOOL HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 17 -
1.9
Impairment of fixed assets

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). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

 

The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

 

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

1.10
Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.

 

Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.

In the case of manufactured products which are held as work in progress, costs include all direct material and labour expenditure involved in production.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

1.11
Cash and cash equivalents

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

EXCOOL HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 18 -
1.12
Financial instruments

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

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.

Other financial assets

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

Impairment of financial assets

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.

Derecognition of financial assets

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.

Classification of financial liabilities

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.

EXCOOL HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 19 -
Basic financial 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.

Other financial liabilities

Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.

 

Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

Derecognition of financial liabilities

Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.

1.13
Equity instruments

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.

EXCOOL HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 20 -
1.14
Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

Current 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

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.

1.15
Employee benefits

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.

1.16
Retirement benefits

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

1.17
Leases

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.

 

Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.

1.18
Government grants

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.

EXCOOL HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 21 -
1.19
Foreign exchange

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.

2
Judgements and key sources of estimation uncertainty

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.

Key sources of estimation uncertainty

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.

Percentage complete

Revenue is recognised based on percentage complete based on budgeted hours versus hours completed on a project to date.

Bad debt provision

Provisions for bad debts are regularly reviewed by management and make judgements based on experience regarding the level of provision required to account for potentially irrecoverable debts.

Depreciation

The annual depreciation charge for tangible fixed assets is sensitive to changes in the estimated useful economic lives and residual values of the assets. The useful lives and residual values are reassessed annually. They are amended when necessary, to reflect current estimates.

Warranty provision

Provisions for warranties given with products are regularly reviewed by management and judgements are made on the level of provision required.

3
Turnover and other revenue
2023
2022
£
£
Turnover analysed by class of business
Data centre cooling systems contract revenues
23,516,892
13,703,976
EXCOOL HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
3
Turnover and other revenue
(Continued)
- 22 -
2023
2022
£
£
Turnover analysed by geographical market
United Kingdom
10,780,468
6,293,460
Europe
3,650,975
5,660,321
Asia
9,085,449
1,750,195
23,516,892
13,703,976
2023
2022
£
£
Other revenue
Interest income
32,925
-
Grants received
-
6,018
4
Operating profit
2023
2022
£
£
Operating profit for the year is stated after charging/(crediting):
Exchange gains
(89,327)
(38,271)
Government grants
-
(6,018)
Depreciation of owned tangible fixed assets
63,133
114,641
Depreciation of tangible fixed assets held under finance leases
194,804
73,119
Profit on disposal of tangible fixed assets
(61,828)
(78,246)
Amortisation of intangible assets
147,173
147,172
5
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the group and company
5,800
5,400
Audit of the financial statements of the company's subsidiaries
26,428
22,798
32,228
28,198
For other services
Taxation compliance services
1,600
1,490
All other non-audit services
17,857
10,117
19,457
11,607
EXCOOL HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 23 -
6
Employees

The average monthly number of persons (including directors) employed by the group and company during the year was:

Group
Company
2023
2022
2023
2022
Number
Number
Number
Number
Factory
128
117
-
-
Administration
57
37
-
-
Directors
6
6
1
1
Total
191
160
1
1

Their aggregate remuneration comprised:

Group
Company
2023
2022
2023
2022
£
£
£
£
Wages and salaries
5,369,821
4,772,312
-
0
-
0
Social security costs
492,350
445,565
-
-
Pension costs
115,831
131,863
-
0
-
0
5,978,002
5,349,740
-
0
-
0

Directors remuneration

 

The director did not receive any remuneration from the company or group in the current or previous financial year.

7
Interest receivable and similar income
2023
2022
£
£
Interest income
Other interest income
32,925
-
EXCOOL HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 24 -
8
Interest payable and similar expenses
2023
2022
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
10,596
6,023
Other interest on financial liabilities
45,682
3,664
56,278
9,687
Other finance costs:
Interest on finance leases and hire purchase contracts
17,679
7,972
Total finance costs
73,957
17,659
9
Fair value gains and losses on foreign exchange contracts

The group made a gain of £194,147 (2022: loss of £127,212) in the year on a foreign exchange forward contract.

10
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
899,505
(204,674)
Adjustments in respect of prior periods
(145,533)
-
0
Total current tax
753,972
(204,674)
Deferred tax
Origination and reversal of timing differences
164,748
-
0
Total tax charge/(credit)
918,720
(204,674)
EXCOOL HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
10
Taxation
(Continued)
- 25 -

The actual charge/(credit) for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:

2023
2022
£
£
Profit before taxation
3,765,133
732,004
Expected tax charge based on the standard rate of corporation tax in the UK of 19.00% (2022: 19.00%)
715,375
139,081
Tax effect of expenses that are not deductible in determining taxable profit
308,325
34,552
Tax effect of income not taxable in determining taxable profit
-
0
(16,507)
Tax effect of utilisation of tax losses not previously recognised
(86,663)
-
0
Unutilised tax losses carried forward
-
0
124
Permanent capital allowances in excess of depreciation
(35,472)
(71,148)
Research and development tax credit
-
0
(297,374)
Other non-reversing timing differences
(2,060)
2,865
Under/(over) provided in prior years
(145,533)
-
0
Chargable gain
-
0
3,733
Deferred tax movement
164,748
-
0
Taxation charge/(credit)
918,720
(204,674)
EXCOOL HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 26 -
11
Dividends
2023
2022
£
£
Interim paid to shareholders of Excool Holdings Limited
-
8,000
During the period, no dividends paid to shareholders.
12
Intangible fixed assets
Group
Goodwill
Negative goodwill
Total
£
£
£
Cost
At 1 April 2022 and 31 March 2023
1,471,722
(4,873,004)
(3,401,282)
Amortisation and impairment
At 1 April 2022
515,102
(4,873,004)
(4,357,902)
Amortisation charged for the year
147,173
-
0
147,173
At 31 March 2023
662,275
(4,873,004)
(4,210,729)
Carrying amount
At 31 March 2023
809,447
-
0
809,447
At 31 March 2022
956,620
-
0
956,620
The company had no intangible fixed assets at 31 March 2023 or 31 March 2022.
EXCOOL HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 27 -
13
Tangible fixed assets
Group
Plant and equipment
Fixtures and fittings
Computers
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 April 2022
398,680
4,491
16,522
1,332,586
1,752,279
Additions
-
0
-
0
28,348
368,820
397,168
Disposals
-
0
-
0
-
0
(455,110)
(455,110)
At 31 March 2023
398,680
4,491
44,870
1,246,296
1,694,337
Depreciation and impairment
At 1 April 2022
133,489
2,688
9,248
506,044
651,469
Depreciation charged in the year
39,403
271
4,438
213,825
257,937
Eliminated in respect of disposals
-
0
-
0
-
0
(272,336)
(272,336)
At 31 March 2023
172,892
2,959
13,686
447,533
637,070
Carrying amount
At 31 March 2023
225,788
1,532
31,184
798,763
1,057,267
At 31 March 2022
265,191
1,803
7,274
826,542
1,100,810
The company had no tangible fixed assets at 31 March 2023 or 31 March 2022.

The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.

Group
Company
2023
2022
2023
2022
£
£
£
£
Plant and equipment
78,441
94,712
-
0
-
0
Motor vehicles
580,700
609,307
-
0
-
0
659,141
704,019
-
-
14
Fixed asset investments
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Investments in subsidiaries
15
-
0
-
0
409,129
309,129
Investments in joint ventures
16
307,376
304,790
-
0
-
0
307,376
304,790
409,129
309,129
EXCOOL HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
14
Fixed asset investments
(Continued)
- 28 -
Movements in fixed asset investments
Group
Shares in joint ventures
£
Cost or valuation
At 1 April 2022
304,790
Valuation changes
19,606
Share of profit for year
(17,020)
At 31 March 2023
307,376
Carrying amount
At 31 March 2023
307,376
At 31 March 2022
304,790
Movements in fixed asset investments
Company
Shares in subsidiaries
£
Cost or valuation
At 1 April 2022
309,129
Additions
100,000
At 31 March 2023
409,129
Carrying amount
At 31 March 2023
409,129
At 31 March 2022
309,129
EXCOOL HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 29 -
15
Subsidiaries

Details of the company's subsidiaries at 31 March 2023 are as follows:

Name of undertaking
Registered office
Nature of business
Class of
% Held
shares held
Direct
Indirect
Excool Limited
England and Wales
Data centre cooling systems
Ordinary A, E and G
86.50
-
Ecoairbox Limited
England and Wales
Dormant
Ordinary A, B and C
100.00
-
Excool China Limited
England and Wales
Data centre cooling systems
Ordinary A
90.00
-
Excool North America Limited
England and Wales
Data centre cooling systems
Ordinary A
93.00
-
Excoolspace Limited
England and Wales
Dormant
Ordinary
100.00
-
Greenbox GBX Holdings Limited
England and Wales
Dormant
Ordinary
-
100.00
Greenbox OEM Limited
England and Wales
Dormant
Ordinary
-
100.00
Excool Hong Kong Limited
Hong Kong
Data centre cooling systems
Ordinary
-
90.00
Excool Inc
United States of America
Data centre cooling systems
Ordinary
-
93.00
ZeroIntel Limited
England and Wales
Data centre cooling systems
Ordinary A
100.00
-

Excool Hong Kong Limited holds a 50% investment in a joint venture Excool Airsys Cooling Technology (Beijing) Co. Limited, a company registered in China.

16
Joint ventures

Details of joint ventures at 31 March 2023 are as follows:

Name of undertaking
Registered office
Nature of business
Interest
% Held
held
Direct
Excool Airsys Cooling Technology (Beijing) Co. Limited
China
Data cooling technology
Ordinary shares
50.00

The group's investment in Excool Airsys Cooling Technology (Beijing) Co. Limited has been accounted for using the equity method for joint ventures in accordance with the financial reporting framework. The joint ventures financial year runs to 31 December 2022. The 50% share of profit for this financial period has been recognised.

17
Financial instruments
Group
Company
2023
2022
2023
2022
£
£
£
£
Carrying amount of financial assets
Debt instruments measured at amortised cost
5,972,869
3,187,606
11,284,204
10,781,465
Carrying amount of financial liabilities
Measured at amortised cost
13,467,489
8,554,973
706,350
119,111
EXCOOL HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 30 -
18
Stocks
Group
Company
2023
2022
2023
2022
£
£
£
£
Raw materials and consumables
3,561,865
1,627,443
-
-
Work in progress
-
233,130
-
-
Finished goods and goods for resale
72,000
1,400,000
-
0
-
0
3,633,865
3,260,573
-
-
19
Construction contracts
Group
Company
2023
2022
2023
2022
£
£
£
£
Contracts in progress at the reporting date
Gross amounts owed by contract customers included in debtors
10,539,639
1,332,812
-
0
-
0
Gross amounts owed to contract customers included in creditors
(5,154,631)
(616,191)
-
0
-
0
Contract revenues recognised
Contract costs incurred plus recognised profits less recognised losses to date
22,837,656
13,626,327
-
-
20
Debtors
Group
Company
2023
2022
2023
2022
Amounts falling due within one year:
£
£
£
£
Trade debtors
5,252,340
1,423,584
-
0
-
0
Gross amounts owed by contract customers
10,539,639
1,332,812
-
0
-
0
Corporation tax recoverable
-
0
151,841
-
0
-
0
Amounts owed by group undertakings
-
-
11,277,016
10,774,205
Amounts owed by undertakings in which the company has a participating interest
-
725,192
-
-
Other debtors
823,564
1,090,961
7,216
7,260
Prepayments and accrued income
864,351
134,059
-
0
-
0
17,479,894
4,858,449
11,284,232
10,781,465
Deferred tax asset (note 26)
-
0
1,856
-
0
-
0
17,479,894
4,860,305
11,284,232
10,781,465
EXCOOL HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 31 -
21
Creditors: amounts falling due within one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Bank loans
23
1,980,321
40,000
-
0
-
0
Obligations under finance leases
24
171,058
193,837
-
0
-
0
Trade creditors
3,094,837
2,367,481
-
0
72
Gross amounts owed to contract customers
5,154,631
616,191
-
0
-
0
Corporation tax payable
601,889
-
0
5,920
-
0
Other taxation and social security
187,427
158,546
-
-
Other creditors
1,647,365
3,603,238
700,000
112,689
Accruals and deferred income
919,053
1,118,703
6,350
6,350
13,756,581
8,097,996
712,270
119,111
22
Creditors: amounts falling due after more than one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Bank loans and overdrafts
23
123,333
160,000
-
0
-
0
Obligations under finance leases
24
376,891
455,523
-
0
-
0
500,224
615,523
-
-
23
Loans and overdrafts
Group
Company
2023
2022
2023
2022
£
£
£
£
Bank loans
2,103,654
200,000
-
0
-
0
Payable within one year
1,980,321
40,000
-
0
-
0
Payable after one year
123,333
160,000
-
0
-
0

The above represents a Coronavirus Business Interruption Loan repayable in instalments over 5 years from May 2022. Interest is payable at the Base Rate plus 2.83%. The loan is guaranteed by members of the Excool Holdings Limited group of companies.

 

Also represented above is Export Finance Loan repayable on the earlier of the last day of its Tenor Limit or cover end date. Interest is payable at the Base Rate plus 2.5%.

 

 

EXCOOL HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 32 -
24
Finance lease obligations
Group
Company
2023
2022
2023
2022
£
£
£
£
Future minimum lease payments due under finance leases:
Within one year
172,058
193,837
-
0
-
0
In two to five years
375,891
455,523
-
0
-
0
547,949
649,360
-
-

Finance lease payments represent rentals payable by the company or group for certain items of plant and machinery. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is 3 years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.

25
Securities

Excool Limited's bank holds a debenture dated 16 February 2021 incorporating a fixed and floating charge.

 

Excool Holdings Limited's bank holds a debenture dated 28 April 2021 incorporating a fixed and floating charge.

 

A charge dated 26 April 2021 was registered at Companies House for an "Omnibus Guarantee and Set Off

Agreement" between Excool Limited, Excool Holdings Limited and Integrated Eco Technologies Limited.

 

Finance leases are secured against the fixed assets which the obligation represents.

26
Deferred taxation

The following are the major deferred tax liabilities and assets recognised by the group and company, and movements thereon:

Liabilities
Liabilities
Assets
Assets
2023
2022
2023
2022
Group
£
£
£
£
Accelerated capital allowances
162,892
-
-
1,856
The company has no deferred tax assets or liabilities.
Group
Company
2023
2023
Movements in the year:
£
£
Asset at 1 April 2022
(1,856)
-
Charge to profit or loss
164,748
-
Liability at 31 March 2023
162,892
-
EXCOOL HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
26
Deferred taxation
(Continued)
- 33 -

The deferred tax asset set out above is expected to reverse within 12 months and relates to the utilisation of tax losses against future expected profits of the same period.

27
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
115,831
131,863

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.

At the year end the liability owing in respect of defined contribution pension schemes amounted to £25,783 (2022: £46,772).

28
Share capital
Group and company
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary A of £1 each
243
243
243
243
29
Reserves
Profit and loss reserves

This represents the accumulated realised earnings from the prior and current periods as reduced by losses and dividends from time to time.

30
Capital commitments

Amounts contracted for but not provided in the financial statements:

Group
Company
2023
2022
2023
2022
£
£
£
£
Acquisition of tangible fixed assets
-
164,686
-
-
EXCOOL HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 34 -
31
Related party transactions
Transactions with related parties

During the year the group entered into the following transactions with related parties:

Sales
Sales
Purchases
Purchases
2023
2022
2023
2022
£
£
£
£
Group
Other related parties
1,496,773
2,668,025
1,872,821
1,791,731

The following amounts were outstanding at the reporting end date:

Amounts due to related parties
2023
2022
£
£
Group
Other related parties
1,670,317
3,163,870

The following amounts were outstanding at the reporting end date:

Amounts due from related parties
2023
2022
Balance
Balance
£
£
Group
Entities over which the group has control, joint control or significant influence
-
732,279
Other related parties
440,250
807,602
32
Directors' transactions

Dividends totalling £0 (2022 - £8,000) were paid in the year in respect of shares held by the company's director.

 

The director did not receive remuneration in the period through the company or group.

33
Controlling party

The ultimate controlling party is deemed to be Mr D Williams, as the sole shareholder of the company.

EXCOOL HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 35 -
34
Cash absorbed by group operations
2023
2022
£
£
Profit for the year after tax
2,846,413
936,678
Adjustments for:
Share of results of associates and joint ventures
17,020
(106,333)
Taxation charged/(credited)
918,720
(204,674)
Finance costs
73,957
17,659
Investment income
(32,925)
-
0
Gain on disposal of tangible fixed assets
(61,828)
(78,246)
Fair value (gain)/loss on foreign exchange contracts
(194,147)
127,212
Amortisation and impairment of intangible assets
147,173
147,172
Depreciation and impairment of tangible fixed assets
257,937
187,760
Movements in working capital:
Increase in stocks
(373,292)
(1,994,810)
Increase in debtors
(12,674,230)
(237,265)
Increase/(decrease) in creditors
3,139,154
(2,359,110)
Decrease in deferred income
-
(21,716)
Cash absorbed by operations
(5,936,048)
(3,585,673)
35
Analysis of changes in net funds - group
1 April 2022
Cash flows
31 March 2023
£
£
£
Cash at bank and in hand
11,212,534
(4,403,232)
6,809,302
Borrowings excluding overdrafts
(200,000)
(1,903,654)
(2,103,654)
Obligations under finance leases
(649,360)
101,411
(547,949)
10,363,174
(6,205,475)
4,157,699
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