Company registration number 9131991 (England and Wales)
I M KELLY HOLDINGS LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023
I M KELLY HOLDINGS LIMITED
COMPANY INFORMATION
Directors
Mr L Christiaen
Mrs M Christiaen
Ms N Christiaen
ECA NV
M J A Matthews
Mr G F Hughes
Company number
9131991
Registered office
Unit 4 Weekley Wood Avenue
Kettering
Northamptonshire
United Kingdom
NN14 1UD
Auditor
Azets Audit Services
Thorpe House
93 Headlands
Kettering
Northamptonshire
United Kingdom
NN15 6BL
I M KELLY HOLDINGS LIMITED
CONTENTS
Page
Strategic report
1 - 3
Directors' report
4 - 5
Directors' responsibilities statement
6
Independent auditor's report
7 - 9
Group statement of comprehensive income
10
Group balance sheet
11
Company balance sheet
12
Group statement of changes in equity
13
Company statement of changes in equity
14
Group statement of cash flows
15
Company statement of cash flows
16
Notes to the financial statements
17 - 39
I M KELLY HOLDINGS LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 JANUARY 2023
- 1 -

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

Fair review of the business

Whilst overall total volume looks very consistent with the prior year, 2022/23 did represent a dynamic period of program change through the business. Turnover of £39.0m drove an increase in Operating profits to £2.9m and an EBITDA of £3.5m.

We consider that our key financial performance activities are those that communicate the financial performance and strength of the group as a whole, these being turnover and operating profit margin.

The industry wide supply chain disruption continued to be a significant feature throughout the period and in many cases drove high levels of weekly volume variation through the Business’ main customer base.

The economic factors of inflation and interest rate increases were a growing feature through the year and are likely to remain a challenge for the foreseeable future. The Business has been responsive to the change and taken necessary steps to maintain profitability.

With supply issues getting resolved, the UK luxury car manufacturing sector remains strong and is actively rising to the challenge of evolving both product range and processes for a more sustainable future. With a strong internal commitment, both Management and parent company ECA, believe that the Business is in a prime position to support this essential evolution.

Principal risks and uncertainties

As for many businesses of our size, the business environment in which we operate continues to be challenging. In particular, operating in the automotive sector, the Business is heavily affected by Macro issues such as Brexit and government regulations in relation to petrol & diesel vehicles. The Business has already noted a significant decline in customers with a strong diesel based product range.

 

Despite these concerns, the premium UK automotive market remains buoyant with a very strong pipeline of new vehicles planned over the next 2-3 years. The management have responded to this challenge by investing in people, technologies and facilities to meet this growth.

Operational risks

Foreign Exchange exposure

The business is exposed to movements in exchange rates as it both purchases and sells product in Euros. Within the reported the year, the group had a natural hedge on its transactions. As programs do grow and decline, this position will however change and is therefore kept under regular review with the business' ultimate parent company, Belgium based ECA NV.

 

Credit risk

The group's principal credit risk arises from its trade debtors. In order to minimise this credit risk the directors hold regular review meetings with its key customers to discuss payment terms and outstanding invoices in order to minimise the risk as far as possible.

Going concern

The Directors have reviewed detailed cash flow forecasts, considering all reasonably foreseeable potential scenarios and uncertainties in relation to revenue and expenditure. Based on these cash flow forecasts prepared, the Directors have reasonable expectation that the company can meet its liabilities as they fall due and the Directors have therefore concluded that the Covid-19 pandemic does not create a material uncertainty in relation to going concern and as such have deemed it appropriate for the financial statements to be prepared on the going concern basis.

I M KELLY HOLDINGS LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023
- 2 -
Statutory duties under s172(1) Companies Act 2006

The Board of Directors believe that they have acted in the way they consider to be both in good faith and would be most likely to promote the success of the  Group for the benefit of its members as a whole (having regard to the stakeholders and matters set out in s172(1)(a-f) of the Act) in the decisions taken during the year ended 31 January 2022; and in so having regard, amongst other matters to; 

 

(a)          the likely consequences of any decision in the long term,

(b)          the interests of the Group’s employees

(c)           the need to foster the Group's business relationships with suppliers, customers and others,

(d)          the impact of the Group's operations on the community and the environment,

(e)           the desirability of the Group maintaining a reputation for high standards of business conduct, and 

(f)           the need to act fairly as between members of the Group.

 

The Board has a business plan which is based around achieving our long-term goal of being regarded as a leading manufacturer of high quality interior trim for the Automotive, Rail & Aerospace markets.

 

The Board understands the importance of engaging with all its stakeholders and regularly discusses issues concerning employees, clients, suppliers, community and environment, regulators and shareholders which inform its decision making processes.

 

Inherently, there is an inter-dependency on the success of the company and the success of its stakeholders.

 

Employees

Our employees remain fundamental to the achievement of our business plan.  In addition to aiming to be a responsible employer in our approach to pay and benefits, we continue to engage with our team to ascertain which training and development opportunities should be made available to improve our team’s productivity and our individual employees’ potential within the business.

 

Clients

We continue to engage closely with our clients, who are mainly large UK based Automotive Manufacturers. Our aim is ensure that our customers’ needs are met and in particular our products arrive on time and meet their specifications.

 

Suppliers

We value the supplier base as partners and our aim is to develop and enter into strong stable working relationships with them. We seek to be fair and transparent in our dealings with suppliers and we ensure that we honour our arrangements with them.

 

Environment and community

The Board recognises the effect that its operations have on the environment both locally and nationally. Consequently, it continues to strengthen its management systems to ensure year on year real improvement. IMK Automotive Ltd is certified to ISO14001.

 

2022 provided a real operational step change following the commissioning of the 716kwp solar panel array on the head office facility at Weekley Wood Kettering. This investment is estimated to avoid 192,000kg of carbon emissions in its first full year.

 

Governance and regulation

The Board’s intention is to behave responsibly and to ensure that the management team operates the business in a responsible manner, acting with the high standards of business conduct and good governance expected of a business of our nature and size and in full alignment with the rules and regulations. In doing so, we believe we will achieve our long-term business strategy and also further develop our reputation in our sector.

 

Members

The Board has a close working relationship with the shareholders and seeks to treat them fairly and equally, in order that they too benefit from the Group achieving its long term business strategy.

 

The Board seeks to provide information relevant to the shareholders, including monthly management accounts including key metrics set by the Board. 

I M KELLY HOLDINGS LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023
- 3 -

On behalf of the board

M J A Matthews
Director
4 May 2023
I M KELLY HOLDINGS LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 JANUARY 2023
- 4 -

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

Principal activities

The principal activity of the company and group continued to be that of the manufacture and sale of interior automotive, aerospace and railway components. The principal activity of the company is that of a holding company.

 

All businesses within the group have continued to invest in new technology and equipment throughout 2021/22. The directors are confident that this investment and the support of ECA Group, the business is ideally placed to grow further within its sector and reinforce its position as a market leading provider of luxury trim.

Results and dividends

The results for the year are set out on page 10.

No ordinary dividends were paid. 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 L Christiaen
Mrs M Christiaen
Ms N Christiaen
ECA NV
M J A Matthews
Mr G F Hughes
Disabled persons

Applications for employment by disabled persons are always fully considered, bearing in mind the aptitudes of the applicant concerned. In the event of members of staff becoming disabled, every effort is made to ensure that their employment within the group continues and that the appropriate training is arranged. It is the policy of the group that the training, career development and promotion of disabled persons should, as far as possible, be identical to that of other employees.

Employee involvement

The group believes that regular communication with its employees is essential for the efficient running of the business.

 

There is a staff association which the group uses to facilitate two-way communication to help efficiency and future growth.

Auditor

The auditor, Azets Audit Services, is deemed to be reappointed under section 487(2) of the Companies Act 2006.

Energy and carbon report

The group's report on its emissions, energy consumption and energy efficiency activities are detailed below:

2023
2022
Energy consumption
kWh
kWh
Aggregate of energy consumption in the year
4,284,614
3,076,684
I M KELLY HOLDINGS LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023
- 5 -
2023
2022
Emissions of CO2 equivalent
metric tonnes
metric tonnes
Scope 1 - direct emissions
- Gas combustion
114.70
93.40
- Fuel consumed for owned transport
72.30
175.40
187.00
268.80
Scope 2 - indirect emissions
- Electricity purchased
348.90
444.30
Scope 3 - other indirect emissions
- Fuel consumed for transport not owned by the
448.50
303.50
Total gross emissions
984.40
1,016.60
Intensity ratio
Tonnes CO2e per employee
2.6
2.6
Quantification and reporting methodology

The group has followed the 2019 HM Government Environmental Reporting Guidelines. The group has also used the GHG Reporting Protocol – Corporate Standard and have used the 2020 UK Government’s Conversion Factors for Company Reporting

Intensity measurement

The chosen intensity measurement ratio is total gross emissions in metric tonnes CO2e per employee, the recommended ratio for the sector.

Measures taken to improve energy efficiency

The Business has now located the majority of its manufacturing operations to a new energy efficient Head Office which utilises both the latest levels of building insulation and solar panelling. Video conferencing is extensively utilised by staff, thus reducing the need for travel between sites, customers and suppliers.

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
M J A Matthews
Director
4 May 2023
I M KELLY HOLDINGS LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 JANUARY 2023
- 6 -

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.

I M KELLY HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF I M KELLY HOLDINGS LIMITED
- 7 -
Opinion

We have audited the financial statements of I M Kelly Holdings Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 January 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, the company 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:

I M KELLY HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF I M KELLY HOLDINGS LIMITED
- 8 -
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 its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report and the directors' report.

 

We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:

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.

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.

I M KELLY HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF I M KELLY HOLDINGS LIMITED
- 9 -

Extent to which the audit was considered capable of detecting irregularities, including fraud

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above and on the Financial Reporting Council’s website, to detect material misstatements in respect of irregularities, including fraud.

 

We obtain and update our understanding of the entity, its activities, its control environment, and likely future developments, including in relation to the legal and regulatory framework applicable and how the entity is complying with that framework.  Based on this understanding, we identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion.  This includes consideration of the risk of acts by the entity that were contrary to applicable laws and regulations, including fraud.

 

In response to the risk of irregularities and non-compliance with laws and regulations, including fraud, we designed procedures which included:

 

 

Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation.  This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance.  The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

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.

Mr Paul Tyler (Senior Statutory Auditor)
For and on behalf of Azets Audit Services
17 May 2023
Chartered Accountants
Statutory Auditor
Thorpe House
93 Headlands
Kettering
Northamptonshire
United Kingdom
NN15 6BL
I M KELLY HOLDINGS LIMITED
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 JANUARY 2023
- 10 -
2023
2022
Notes
£
£
Turnover
3
39,001,971
38,214,205
Cost of sales
(32,046,534)
(32,012,392)
Gross profit
6,955,437
6,201,813
Distribution costs
(76,883)
(82,272)
Administrative expenses
(3,932,017)
(3,938,140)
Other operating income
-
318,593
Operating profit
4
2,946,537
2,499,994
Interest receivable and similar income
8
41,047
1,254
Interest payable and similar expenses
9
(14,852)
(31,227)
Profit before taxation
2,972,732
2,470,021
Tax on profit
10
(621,889)
(402,598)
Profit for the financial year
26
2,350,843
2,067,423
Profit for the financial year is all attributable to the owner of the parent company.
Total comprehensive income for the year is all attributable to the owner of the parent company.
I M KELLY HOLDINGS LIMITED
GROUP BALANCE SHEET
AS AT 31 JANUARY 2023
31 January 2023
- 11 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
11
21,185,499
21,215,395
Investment properties
12
2,800,000
2,800,000
23,985,499
24,015,395
Current assets
Stocks
15
4,502,192
4,936,776
Debtors
16
5,620,061
6,231,190
Cash at bank and in hand
11,297,236
8,577,449
21,419,489
19,745,415
Creditors: amounts falling due within one year
17
(7,557,767)
(8,394,170)
Net current assets
13,861,722
11,351,245
Total assets less current liabilities
37,847,221
35,366,640
Creditors: amounts falling due after more than one year
18
(2,000,000)
(2,000,000)
Provisions for liabilities
Deferred tax liability
20
357,613
227,877
(357,613)
(227,877)
Net assets
35,489,608
33,138,763
Capital and reserves
Called up share capital
22
13,177,566
13,177,566
Share premium account
23
15,263
15,263
Capital redemption reserve
24
48,750
48,750
Fair value reserve
25
603,797
603,797
Profit and loss reserves
26
21,644,232
19,293,387
Total equity
35,489,608
33,138,763
The financial statements were approved by the board of directors and authorised for issue on 4 May 2023 and are signed on its behalf by:
04 May 2023
M J A Matthews
Mr G F Hughes
Director
Director
I M KELLY HOLDINGS LIMITED
COMPANY BALANCE SHEET
AS AT 31 JANUARY 2023
31 January 2023
- 12 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
11
19,648,229
19,137,829
Investment properties
12
2,800,000
2,800,000
Investments
14
1,552,727
1,552,727
24,000,956
23,490,556
Current assets
Debtors
16
60,652
13,356
Cash at bank and in hand
7,297,961
6,554,411
7,358,613
6,567,767
Creditors: amounts falling due within one year
17
(2,267,201)
(1,800,439)
Net current assets
5,091,412
4,767,328
Total assets less current liabilities
29,092,368
28,257,884
Creditors: amounts falling due after more than one year
18
(2,000,000)
(2,000,000)
Provisions for liabilities
Deferred tax liability
20
318,182
144,037
(318,182)
(144,037)
Net assets
26,774,186
26,113,847
Capital and reserves
Called up share capital
22
13,177,566
13,177,566
Fair value reserve
25
603,797
603,797
Profit and loss reserves
26
12,992,823
12,332,484
Total equity
26,774,186
26,113,847

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 £660,339 (2022 - £648,542 profit).

The financial statements were approved by the board of directors and authorised for issue on 4 May 2023 and are signed on its behalf by:
04 May 2023
M J A Matthews
Mr G F Hughes
Director
Director
Company Registration No. 9131991
I M KELLY HOLDINGS LIMITED
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 JANUARY 2023
- 13 -
Share capital
Share premium account
Capital redemption reserve
Non-distri-butable profits
Profit and loss reserves
Total
£
£
£
£
£
£
Balance at 1 February 2021
13,177,566
15,263
48,750
603,797
17,225,965
31,071,341
Year ended 31 January 2022:
Profit and total comprehensive income for the year
-
-
-
-
2,067,423
2,067,423
Balance at 31 January 2022
13,177,566
15,263
48,750
603,797
19,293,388
33,138,764
Year ended 31 January 2023:
Profit and total comprehensive income for the year
-
-
-
-
2,350,843
2,350,843
Balance at 31 January 2023
13,177,566
15,263
48,750
603,797
21,644,231
35,489,607
I M KELLY HOLDINGS LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 JANUARY 2023
- 14 -
Share capital
Non-distri-butable profits
Profit and loss reserves
Total
£
£
£
£
Balance at 1 February 2021
13,177,566
603,797
11,683,942
25,465,305
Year ended 31 January 2022:
Profit and total comprehensive income for the year
-
-
648,542
648,542
Balance at 31 January 2022
13,177,566
603,797
12,332,484
26,113,847
Year ended 31 January 2023:
Profit and total comprehensive income for the year
-
-
660,339
660,339
Balance at 31 January 2023
13,177,566
603,797
12,992,823
26,774,186
I M KELLY HOLDINGS LIMITED
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 JANUARY 2023
- 15 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from/(absorbed by) operations
31
5,090,019
(1,141,593)
Interest paid
(14,852)
(31,227)
Income taxes (paid)/refunded
(240,680)
55,754
Net cash inflow/(outflow) from operating activities
4,834,487
(1,117,066)
Investing activities
Purchase of tangible fixed assets
(750,597)
(2,029,721)
Proceeds on disposal of tangible fixed assets
63,237
238,253
Interest received
41,047
1,254
Net cash used in investing activities
(646,313)
(1,790,214)
Financing activities
Repayment of borrowings
(1,468,387)
(5,615,424)
Net cash used in financing activities
(1,468,387)
(5,615,424)
Net increase/(decrease) in cash and cash equivalents
2,719,787
(8,522,704)
Cash and cash equivalents at beginning of year
8,577,449
17,100,153
Cash and cash equivalents at end of year
11,297,236
8,577,449
I M KELLY HOLDINGS LIMITED
COMPANY STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 JANUARY 2023
- 16 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
32
864,597
1,738,623
Interest paid
(14,790)
(28,845)
Income taxes paid
(134,961)
-
0
Net cash inflow from operating activities
714,846
1,709,778
Investing activities
Purchase of tangible fixed assets
(533,524)
(1,928,468)
Interest received
30,615
539
Net cash used in investing activities
(502,909)
(1,927,929)
Financing activities
Proceeds from borrowings
2,000,000
-
0
Repayment of borrowings
(1,468,387)
(5,615,424)
Net cash generated from/(used in) financing activities
531,613
(5,615,424)
Net increase/(decrease) in cash and cash equivalents
743,550
(5,833,575)
Cash and cash equivalents at beginning of year
6,554,411
12,387,986
Cash and cash equivalents at end of year
7,297,961
6,554,411
I M KELLY HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023
- 17 -
1
Accounting policies
Company information

I M Kelly Holdings Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is Unit 4 Weekley Wood Avenue, Kettering, Northamptonshire, NN14 1UD.

 

The group consists of I M Kelly 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, modified to include the revaluation of freehold properties and to include investment properties and certain financial instruments at fair value. 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 I M Kelly 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 January 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.

Entities in which the group holds an interest and which are jointly controlled by the group and one or more other venturers under a contractual arrangement are treated as joint ventures. 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.

I M KELLY HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023
1
Accounting policies
(Continued)
- 18 -

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 and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.

 

When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income.

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.

1.6
Research and development expenditure

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.

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:

Freehold land and property
2% on straight line
Plant and machinery
Pre 2016 assets at 25% on reducing balance and post 2016 assets at 12.5% on cost
Computers and office equipment
33% on reducing balance
Motor vehicles
25% on reducing balance
Improvements to property
25% on reducing balance / 5% on straight line
I M KELLY HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023
1
Accounting policies
(Continued)
- 19 -

Freehold land and property and assets in the course of construction are not depreciated. No depreciation is provided on freehold properties because they are fully maintained on a regular basis. Accordingly the directors consider the lives of these assets to be so long and their residual value so high, that their depreciation is insignificant.

 

Freehold property includes land at an estimated cost of £5,636,000 (2022: £5,636,000).

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
Investment properties

Investment property, which is property held to earn rentals and/or for capital appreciation, is initially recognised at cost, which includes the purchase cost and any directly attributable expenditure. Subsequently it is measured at fair value at the reporting end date. Changes in fair value are recognised in profit or loss.

 

Property rented to a group entity is accounted for as tangible fixed assets.

1.9
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.

I M KELLY HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023
1
Accounting policies
(Continued)
- 20 -
1.10
Impairment of fixed assets

At each reporting period end date, the group reviews the carrying amounts of its tangible 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.

1.11
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.

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.

1.12
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.

I M KELLY HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023
1
Accounting policies
(Continued)
- 21 -
1.13
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.

I M KELLY HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023
1
Accounting policies
(Continued)
- 22 -
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.

1.14
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.

1.15
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.

I M KELLY HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023
1
Accounting policies
(Continued)
- 23 -
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.

1.16
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.

 

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.

1.17
Retirement benefits

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

1.18
Leases

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.

1.19
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.

1.20
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.

I M KELLY HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023
- 24 -
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.

Critical judgements

The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.

Useful economic lives and residual values of tangible fixed assets

The useful economic lives and residual values of tangible fixed assets are judged at the point of purchase and is then re-assessed at each reporting date as necessary. The useful economic life of each asset class is stated in the accounting policies above.

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.

Provision for irrecoverable trade debtors

At each balance sheet date, management undertake a review of the outstanding trade debtor balances and estimate the balance that should be either impaired or provided against.

 

This calculation is based on the financial position of the customers, the historical speed of payment and any ongoing discussions.

Provision for slow moving and obsolete stock

At each balance sheet date, management undertake and assessment of the value at which stock items are held within the accounts. The provision is calculated on a stock usage basis, allowing for known obsolete stock items. This provision is reviewed and updated at each reporting date.

3
Turnover and other revenue
2023
2022
£
£
Turnover analysed by geographical market
UK
37,868,612
36,717,072
Europe
919,745
1,350,215
Rest of the world
213,614
146,918
39,001,971
38,214,205
I M KELLY HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023
3
Turnover and other revenue
(Continued)
- 25 -
2023
2022
£
£
Other revenue
Interest income
41,047
1,254
Grants received
-
0
318,593
Rental income arising from investment properties
175,750
121,479

Grants received comprise government grants receivable by the group under the Coronavirus Job Retention Scheme.

4
Operating profit
2023
2022
£
£
Operating profit for the year is stated after charging/(crediting):
Exchange losses
111,643
39,138
Research and development costs
56,534
114,256
Government grants
-
0
(318,593)
Depreciation of owned tangible fixed assets
543,036
594,304
Loss/(profit) on disposal of tangible fixed assets
174,220
(15,466)
Operating lease charges
82,349
58,321
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
1,500
1,000
Audit of the financial statements of the company's subsidiaries
18,350
16,000
19,850
17,000
For other services
All other non-audit services
14,050
12,625

 

I M KELLY HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023
- 26 -
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
Management
71
75
1
1
Other activities
269
277
-
-
Total
340
352
1
1

Their aggregate remuneration comprised:

Group
Company
2023
2022
2023
2022
£
£
£
£
Wages and salaries
11,158,353
10,490,588
75,000
74,194
Social security costs
843,728
889,871
10,346
9,019
Pension costs
383,317
233,966
-
0
-
0
12,385,398
11,614,425
85,346
83,213
7
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
291,491
259,320
Remuneration disclosed above includes the following amounts paid to the highest paid director:
2023
2022
£
£
Remuneration for qualifying services
203,954
180,278

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 1 (2022: Nil).

I M KELLY HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023
- 27 -
8
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
38,739
539
Other interest income
2,308
715
Total income
41,047
1,254

Investment income includes the following:

Interest on financial assets not measured at fair value through profit or loss
38,739
539
9
Interest payable and similar expenses
2023
2022
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
-
0
1,415
Interest payable to group undertakings
14,790
28,845
14,790
30,260
Other finance costs:
Other interest
62
967
Total finance costs
14,852
31,227
10
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
521,774
474,595
Adjustments in respect of prior periods
(29,621)
(26,809)
Total current tax
492,153
447,786
Deferred tax
Origination and reversal of timing differences
99,346
(45,188)
Changes in tax rates
30,390
-
0
Total deferred tax
129,736
(45,188)
Total tax charge
621,889
402,598
I M KELLY HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023
10
Taxation
(Continued)
- 28 -

The actual charge 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
2,972,732
2,470,021
Expected tax charge based on the standard rate of corporation tax in the UK of 19.00% (2022: 19.00%)
564,819
469,304
Tax effect of expenses that are not deductible in determining taxable profit
10,793
(23,060)
Adjustments in respect of prior years
(11,001)
(26,809)
Effect of change in corporation tax rate
7,481
-
Permanent capital allowances in excess of depreciation
(4,100)
-
0
Depreciation on assets not qualifying for tax allowances
5,334
7,465
Research and development tax credit
(34,082)
-
0
Other non-reversing timing differences
8,239
(39,647)
Under/(over) provided in prior years
4,461
-
0
Deferred tax adjustments in respect of prior years
(202)
-
0
Tax losses utilised
45,486
15,345
Changes in deferred tax rates
24,661
-
0
Taxation charge
621,889
402,598
I M KELLY HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023
- 29 -
11
Tangible fixed assets
Group
Freehold land and property
Plant and machinery
Computers and office equipment
Motor vehicles
Improvements to property
Total
£
£
£
£
£
£
Cost
At 1 February 2022
19,071,378
4,711,732
712,697
170,451
414,734
25,080,992
Additions
12,623
179,943
7,135
29,995
520,901
750,597
Disposals
-
0
(336,087)
(10,300)
(31,550)
-
0
(377,937)
At 31 January 2023
19,084,001
4,555,588
709,532
168,896
935,635
25,453,652
Depreciation and impairment
At 1 February 2022
-
0
2,881,387
510,176
125,751
348,283
3,865,597
Depreciation charged in the year
-
0
442,308
66,581
11,023
23,124
543,036
Eliminated in respect of disposals
-
0
(101,433)
(9,113)
(29,934)
-
0
(140,480)
At 31 January 2023
-
0
3,222,262
567,644
106,840
371,407
4,268,153
Carrying amount
At 31 January 2023
19,084,001
1,333,326
141,888
62,056
564,228
21,185,499
At 31 January 2022
19,071,378
1,830,345
202,521
44,700
66,451
21,215,395
Company
Freehold land and property
Improvements to property
Total
£
£
£
Cost
At 1 February 2022
19,071,378
414,734
19,486,112
Additions
12,623
520,901
533,524
At 31 January 2023
19,084,001
935,635
20,019,636
Depreciation and impairment
At 1 February 2022
-
0
348,283
348,283
Depreciation charged in the year
-
0
23,124
23,124
At 31 January 2023
-
0
371,407
371,407
Carrying amount
At 31 January 2023
19,084,001
564,228
19,648,229
At 31 January 2022
19,071,378
66,451
19,137,829
I M KELLY HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023
11
Tangible fixed assets
(Continued)
- 30 -

Included in the cost of land and buildings is freehold land of £5,650,000 which is not depreciated. No depreciation is provided on freehold properties because they are fully maintained on a regular basis. Accordingly the directors consider the lives of these assets to be so long and their residual value so high, that their depreciation is insignificant.

 

Assets within freehold land and property and improvements to property are held for use by the subsidiary companies, IMK Automotive Limited and I M Kelly R & A Ltd.

12
Investment property
Group
Company
2023
2023
£
£
Fair value
At 1 February 2022 and 31 January 2023
2,800,000
2,800,000

Investment property comprises a commercial property in Orion Way, Kettering. The fair value of the investment property has been arrived at on the basis of a valuation carried out at April 2021 by Berrys Chartered Surveyors, who are not connected with the company. The valuation was made on an open market value basis by reference to market evidence of transaction prices for similar properties.

If investment properties were stated on an historical cost basis rather than a fair value basis, the amounts would have been included as follows:
Group
Company
2023
2022
2023
2022
£
£
£
£
Cost
2,054,571
2,054,571
2,054,571
2,054,571
Accumulated depreciation
-
-
-
-
Carrying amount
2,054,571
2,054,571
2,054,571
2,054,571
13
Subsidiaries

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

Name of undertaking
Registered office
Nature of business
Class of
% Held
shares held
Direct
IMK Automotive Limited
Unit 4 Weekley Wood Avenue, Kettering, Northamptonshire, NN14 1UD
Automotive interior manufacture
Ordinary
100.00
I.M. Kelly Limited
As above
Dormant
Ordinary
100.00
I M Kelly R & A Ltd
As above
Railway and aerospace seating manufacture
Ordinary
100.00
I M Kelly Autmotive Limited
As above
Dormant
Ordinary
100.00
I M KELLY HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023
- 31 -
14
Fixed asset investments
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Investments in subsidiaries
13
-
0
-
0
1,552,727
1,552,727
Movements in fixed asset investments
Company
Shares in group undertakings
£
Cost or valuation
At 1 February 2022 and 31 January 2023
1,552,727
Carrying amount
At 31 January 2023
1,552,727
At 31 January 2022
1,552,727
15
Stocks
Group
Company
2023
2022
2023
2022
£
£
£
£
Raw materials and consumables
2,821,389
3,019,724
-
0
-
0
Work in progress
1,193,204
1,426,017
-
-
Finished goods and goods for resale
487,599
491,035
-
0
-
0
4,502,192
4,936,776
-
0
-
0
16
Debtors
Group
Company
2023
2022
2023
2022
Amounts falling due within one year:
£
£
£
£
Trade debtors
5,076,982
6,002,195
2,800
-
0
Corporation tax recoverable
14,557
15,345
-
0
-
0
Amounts owed by group undertakings
-
-
11,668
-
Other debtors
52,168
13,408
46,184
13,356
Prepayments and accrued income
476,354
200,242
-
0
-
0
5,620,061
6,231,190
60,652
13,356

The amounts owed by group undertakings are due on demand, unsecured, interest-free and are expected to be settled in cash.

 

I M KELLY HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023
- 32 -
17
Creditors: amounts falling due within one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Other borrowings
19
23,275
1,491,662
2,023,275
1,491,662
Trade creditors
1,882,782
2,106,688
-
0
1,870
Corporation tax payable
401,774
151,089
60,277
134,961
Other taxation and social security
949,797
921,842
863
48,812
Other creditors
3,422,595
3,038,501
182,786
123,134
Accruals and deferred income
877,545
684,388
-
0
-
0
7,557,768
8,394,170
2,267,201
1,800,439

Other borrowings comprise loans made by the ultimate parent company, ECA NV. The terms of these loans are shown in the loans and overdrafts note below.

18
Creditors: amounts falling due after more than one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Other borrowings
19
2,000,000
2,000,000
2,000,000
2,000,000

Other borrowings comprise loans made by the ultimate parent company, ECA NV. The terms of these loans are shown in the loans and overdrafts note below.

19
Loans and overdrafts
Group
Company
2023
2022
2023
2022
£
£
£
£
Loans from group undertakings
2,023,275
3,491,662
4,023,275
3,491,662
Payable within one year
23,275
1,491,662
2,023,275
1,491,662
Payable after one year
2,000,000
2,000,000
2,000,000
2,000,000
I M KELLY HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023
19
Loans and overdrafts
(Continued)
- 33 -

At 31 January 2023 amounts were outstanding on two loans made to the company / group by the company's / group's parent company, ECA NV.

 

A loan of £2,000,000 was made in June 2017. This loan is repayable on demand with 12 months notice and interest accrues at a rate of 1% per annum. Only interest is currently being repaid with the original loan balance outstanding at 31 January 2023 plus accrued interest of £21,667 still to be repaid at 31 January 2023.

 

In August 2020 a loan of £6,770,175 (€7,500,000) was made to the company / group. This loan is repayable on demand and interest accrues on the outstanding balance at a rate of 0.15% per annum, payable on or before 31 December each calendar year until the loan is fully repaid. The balance outstanding on this loan at 31 January 2023 was £1,609.

 

A loan of £2,000,000 was received in November 2022 from a group subsidiary. This loan is interest free and repayable on demand.

20
Deferred taxation

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

Liabilities
Liabilities
2023
2022
Group
£
£
Accelerated capital allowances
226,832
95,858
Investment property
186,357
141,632
Short term timing differences
(55,576)
(9,613)
357,613
227,877
Liabilities
Liabilities
2023
2022
Company
£
£
Accelerated capital allowances
131,825
2,405
Investment property
186,357
141,632
318,182
144,037
Group
Company
2023
2023
Movements in the year:
£
£
Liability at 1 February 2022
227,877
144,037
Charge to profit or loss
53,860
128,659
Effect of change in tax rate - profit or loss
75,876
45,486
Liability at 31 January 2023
357,613
318,182
I M KELLY HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023
20
Deferred taxation
(Continued)
- 34 -
21
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
383,317
233,966

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.

22
Share capital
Group and company
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary of £1 each
13,177,566
13,177,566
13,177,566
13,177,566
I M KELLY HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023
- 35 -
23
Share premium account
Group
Company
2023
2022
2023
2022
£
£
£
£
At beginning and end of year
15,263
15,263
-
0
-
0

This reserve records the amount above the nominal value received for shares sold, less transaction costs.

24
Capital redemption reserve
Group
Company
2023
2022
2023
2022
£
£
£
£
At the beginning and end of the year
48,750
48,750
-
0
-
0

This reserve records the nominal value of shares repurchased by the group.

25
Fair value reserve
Group
Company
2023
2022
2023
2022
£
£
£
£
At the beginning and end of the year
603,797
603,797
603,797
603,797

The Fair value reserve represents the revaluation gains on company / group investment properties net of the associated deferred tax liability.

26
Profit and loss reserves
Group
Company
2023
2022
2023
2022
£
£
£
£
At the beginning of the year
19,293,388
17,225,965
12,332,484
11,683,942
Profit for the year
2,350,843
2,067,423
660,339
648,542
At the end of the year
21,644,231
19,293,388
12,992,823
12,332,484
I M KELLY HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023
- 36 -
27
Operating lease commitments
Lessee

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:

Group
Company
2023
2022
2023
2022
£
£
£
£
Within one year
42,470
58,385
-
-
Between two and five years
67,330
152,553
-
-
In over five years
-
11,756
-
-
109,800
222,694
-
-
28
Capital commitments

Amounts contracted for but not provided in the financial statements:

Group
Company
2023
2022
2023
2022
£
£
£
£
Acquisition of tangible fixed assets
206,500
80,738
-
-
29
Related party transactions
Remuneration of key management personnel

The remuneration of key management personnel is as follows.

2023
2022
£
£
Aggregate compensation
676,188
627,479
Transactions with related parties

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

Sales
Purchases
2023
2022
2023
2022
£
£
£
£
Group
Entities with control, joint control or significant influence over the group
-
166,133
3,804
68,366
Other related parties
-
-
-
3,940
I M KELLY HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023
29
Related party transactions
(Continued)
- 37 -
Management charges
Interest on loans
2023
2022
2023
2022
£
£
£
£
Group
Entities with control, joint control or significant influence over the company
109,680
109,904
14,790
28,845
Company
Entities with control, joint control or significant influence over the company
109,680
109,904
14,790
28,845

In addition to the above related party transactions, during the year the group / company purchased key management services at a cost of £Nil (2022: £12,100) from a company controlled by a member of key management personnel.

The following amounts were outstanding at the reporting end date:

Amounts due to related parties
2023
2022
£
£
Group
Entities with control, joint control or significant influence over the group
2,023,275
3,500,662
Other related parties
-
4,728
Company
Entities with control, joint control or significant influence over the company
2,023,275
3,491,662

The following amounts were outstanding at the reporting end date:

Amounts due from related parties
2022
Balance
£
Group
Key management personnel
13,356
Company
Key management personnel
13,356

The amounts outstanding are interest-free, unsecured and will be settled in cash.

I M KELLY HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023
- 38 -
30
Controlling party

ECA NV (incorporated in Belgium) is regarded by the directors as being the company's ultimate parent company.

The ultimate controlling parties are L Christiaen and Mrs M Christiaen.

 

 

31
Cash generated from group operations
2023
2022
£
£
Profit for the year after tax
2,350,843
2,067,423
Adjustments for:
Taxation charged
621,889
402,598
Finance costs
14,852
31,227
Investment income
(41,047)
(1,254)
Loss/(gain) on disposal of tangible fixed assets
174,220
(15,466)
Depreciation and impairment of tangible fixed assets
543,036
594,304
Movements in working capital:
Decrease in stocks
434,584
838,946
Decrease/(increase) in debtors
610,342
(3,938,354)
Increase/(decrease) in creditors
381,300
(1,121,017)
Cash generated from/(absorbed by) operations
5,090,019
(1,141,593)
32
Cash generated from operations - company
2023
2022
£
£
Profit for the year after tax
660,339
648,542
Adjustments for:
Taxation charged
234,422
131,371
Finance costs
14,790
28,845
Investment income
(30,615)
(539)
Depreciation and impairment of tangible fixed assets
23,124
22,150
Movements in working capital:
(Increase)/decrease in debtors
(47,296)
897,259
Increase in creditors
9,833
10,995
Cash generated from operations
864,597
1,738,623
I M KELLY HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023
- 39 -
33
Analysis of changes in net funds - group
1 February 2022
Cash flows
31 January 2023
£
£
£
Cash at bank and in hand
8,577,449
2,719,787
11,297,236
Borrowings excluding overdrafts
(3,491,662)
1,468,387
(2,023,275)
5,085,787
4,188,174
9,273,961
34
Analysis of changes in net funds - company
1 February 2022
Cash flows
31 January 2023
£
£
£
Cash at bank and in hand
6,554,411
743,550
7,297,961
Borrowings excluding overdrafts
(3,491,662)
(531,613)
(4,023,275)
3,062,749
211,937
3,274,686
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