Company registration number 02635454 (England and Wales)
THE DARENT WAX COMPANY LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
THE DARENT WAX COMPANY LIMITED
COMPANY INFORMATION
Directors
Mr L Finlayson-Green
Mr AC Ward
Mr TA Ward
Mr RE Parker
Secretary
Mrs J Ward
Company number
02635454
Registered office
1 The Mills
Station Road
South Darenth
Kent
DA4 9BD
Auditor
Lindeyer Francis Ferguson Limited
North House
198 High Street
Tonbridge
Kent
TN9 1BE
Business address
1 The Mills
Station Road
South Darenth
Kent
DA4 9BD
THE DARENT WAX COMPANY LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2 - 3
Independent auditor's report
4 - 6
Statement of comprehensive income
7
Balance sheet
8
Statement of changes in equity
9
Notes to the financial statements
10 - 21
THE DARENT WAX COMPANY LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2023
- 1 -
The directors present the strategic report for the year ended 31 March 2023.
Fair review of the business
The directors are pleased with progress made with development in The Darent Wax Company Limited, a wholly owned manufacturing business.
In spite of continued challenges within global markets the directors are pleased to report on a satisfactory year.
Export markets continue to be vital for our products and growth of the business, now contributing more than 50% of our sales turnover. It is anticipated that a significant proportion of future growth will be delivered through our strategy to service new/developing overseas territories and the development of new product lines.
Principal risks and uncertainties
The Directors have assessed the main risks facing the Company as being from increased costs of raw materials, energy costs and competition from other manufacturers with similar operations.
The Directors believe that the quality of products and standard of technical customer service will help mitigate these risks and anticipate seeing continued growth and satisfactory trading results in the coming year.
Development and performance
Deep water sales opportunities in our beauty portfolio of wax products continue to increase, resulting in ongoing investments being made to increase production capacity, improve productivity, and reduce lead times.
Key Performance Indicators
The group has ISO 9001/2015 accreditation which demands the use of KPI’s, both financial and nonfinancial, and these are all used in the management of the company. Profit and loss figures, gross margins, net profitability, and production metrics etc are all in line with where we could reasonably expect them to be given the continued challenging landscape. All indications suggest that demand for our products and services into 22/23 and beyond remains high.
Mr L Finlayson-Green
Director
29 September 2023
THE DARENT WAX COMPANY 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 continued to be that of the manufacture of speciality wax compounds.
Results and dividends
The results for the year are set out on page 7.
The directors are pleased to report a successful year with operating profits of £1,693,371 (2022: £1,665,709) on sales of £13,565,105 (2022: £11,591,958). A satisfactory result given the background turbulence in global confidence and related cost and supply chain challenges resulting from the Russian invasion of Ukraine in February 2022.
Ordinary dividends were paid amounting to £390,000 (2022: £150,000). 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 Finlayson-Green
Mr AC Ward
Mr TA Ward
Mr RE Parker
Financial instruments
Liquidity risk
The company carefully manages it cash and borrowing requirement in order to maximise interest income and minimise interest expense, whilst ensuring the company has sufficient liquid resources to meet the operating needs of the business.
Foreign currency risk
The company's principal foreign currency exposures arise from trading with overseas companies. An appreciable portion of the company's sales and procurement activities are made in US Dollars and Euros. Having identified the potential for currency de-valuation risk a dynamic strategy has been developed to mitigate against currency fluctuations by proactively seeking to balance foreign currency sales with forward procurement of materials thus limiting the necessity for foreign currency exchange.
Credit risk
Investments of cash surpluses and borrowings 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.
Future developments
The global market for our products continues to expand and change. Consequently the group is constantly seeking new opportunities and investing in new equipment to increase production capacity, improve productivity and reduce lead times. Some £228,000 of new equipment was acquired during the year, including a new production line. This came onstream in April 2023.
THE DARENT WAX COMPANY LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 3 -
Subsequent to the year end, the board has introduced new management structures and disciplines with a view to improving internal efficiencies and communication.
Auditor
The auditor, Lindeyer Francis Ferguson Limited, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
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 company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
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 company’s auditor 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 company’s auditor is aware of that information.
On behalf of the board
Mr L Finlayson-Green
Director
29 September 2023
THE DARENT WAX COMPANY LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF THE DARENT WAX COMPANY LIMITED
- 4 -
Opinion
We have audited the financial statements of The Darent Wax Company Limited (the 'company') for the year ended 31 March 2023 which comprise the statement of comprehensive income, the balance sheet, the statement of changes in equity 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:
give a true and fair view of the state of the company's affairs as at 31 March 2023 and of its profit for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.
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 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 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.
The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit:
the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
THE DARENT WAX COMPANY LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF THE DARENT WAX COMPANY LIMITED
- 5 -
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.
Auditor'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. As part of an audit, in accordance with ISAs (UK), we exercise professional judgement and maintain professional scepticism throughout the audit.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We designed procedures in line with our responsibilities, outlined below, 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.
We obtained an understanding of the legal and regulatory framework applicable to the preparation of the financial statements of the company, and the procedures that management adopt to ensure compliance. We have considered the extent to which non-compliance might have a material effect on the financial statements, and in particular we identified: the Companies Act 2006.
We have also identified other laws and regulations that do not have a direct effect on the amounts or disclosures within the financial statements, but for which compliance is fundamental to the company’s operations and to avoid material penalties, including the General Data Protection Regulation, health and safety, and employment law.
Having reviewed the laws and regulations applicable to the company, we designed and performed audit procedures to obtain sufficient appropriate audit evidence. Specifically, we:
Selected a team with sector experience to perform the audits;
Obtained and reviewed internal policies and procedures and external guidance
Reviewed the minutes of meetings held in the year by management for any evidence of non compliance with laws or regulations;
Held discussions with management involved in the compliance functions, including consideration of known or suspected instances of non-compliance with laws and regulations and fraud
Reviewed the completeness and accuracy of associated disclosures made in the financial statements.
THE DARENT WAX COMPANY LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF THE DARENT WAX COMPANY LIMITED
- 6 -
We evaluated management’s incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls) and determined that the key risks were related to the understatement of revenue, and management bias in accounting estimates and areas of the financial statements requiring judgement. Such areas include, but are not limited to, the depreciation of tangible fixed assets, the carrying value of inventory, the bad debt provision for trade debtors and the impairment of intercompany group debtors. Audit procedures performed by us included:
Assessing the systems and controls in place, and whether any weaknesses were identified which could suggest or allow fraud;
Challenging assumptions made by management in arriving at accounting estimates and judgements;
Considering the appropriateness of the depreciation rates used and ensuring that these had been applied consistently for all assets within each class;
Reviewing the net realisable value of inventory and whether any provision is required for obsolete stock;
Designing and performing audit procedures to obtain sufficient appropriate audit evidence in relation to the completeness and cut-off of income;
Reviewing post year-end receipts to ensure the recoverability of trade debtors; and
Reviewing the performance of group companies to ensure that intercompany group debtors do not require impairment.
The audit has been planned and performed in such a way as to best identify risks of material misstatement, however, because of the inherent limitations of audit procedures there is a risk that we will not detect all irregularities, including those that may lead to material misstatements in the financial statements. For example, whilst we have properly planned and performed our audit in accordance with auditing standards, the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely audit procedures are to identify it. Also, the risk of not detecting an irregularity due to fraud is higher than the risk of not detecting one resulting from error, due to probable deliberate concealment, override of controls, collusion or misrepresentations.
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.
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.
Jonathan Healey FCA
Senior Statutory Auditor
For and on behalf of Lindeyer Francis Ferguson Limited
10 October 2023
2023-10-10
Chartered Accountants
Statutory Auditor
North House
198 High Street
Tonbridge
Kent
TN9 1BE
THE DARENT WAX COMPANY LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2023
- 7 -
2023
2022
as restated
Notes
£
£
Turnover
3
13,565,105
11,591,958
Cost of sales
(10,072,845)
(8,399,812)
Gross profit
3,492,260
3,192,146
Administrative expenses
(1,798,889)
(1,559,181)
Other operating income
32,744
Operating profit
4
1,693,371
1,665,709
Interest payable and similar expenses
7
(29,361)
(47,260)
Profit before taxation
1,664,010
1,618,449
Tax on profit
8
(333,775)
(227,041)
Profit for the financial year
1,330,235
1,391,408
The profit and loss account has been prepared on the basis that all operations are continuing operations.
THE DARENT WAX COMPANY LIMITED
BALANCE SHEET
AS AT
31 MARCH 2023
31 March 2023
- 8 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
9
1,224,527
944,052
Investments
10
4
1,224,527
944,056
Current assets
Stocks
11
2,296,246
2,203,405
Debtors
12
4,947,012
4,559,219
Cash at bank and in hand
353,870
211,354
7,597,128
6,973,978
Creditors: amounts falling due within one year
13
(1,762,636)
(1,901,779)
Net current assets
5,834,492
5,072,199
Total assets less current liabilities
7,059,019
6,016,255
Creditors: amounts falling due after more than one year
15
(526,478)
(542,704)
Provisions for liabilities
Deferred tax liability
18
268,088
149,333
(268,088)
(149,333)
Net assets
6,264,453
5,324,218
Capital and reserves
Called up share capital
20
42,055
42,055
Share premium account
16,213
16,213
Revaluation reserve
21,722
24,135
Capital redemption reserve
23,463
23,463
Profit and loss reserves
6,161,000
5,218,352
Total equity
6,264,453
5,324,218
These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.true
The financial statements were approved by the board of directors and authorised for issue on 29 September 2023 and are signed on its behalf by:
Mr L Finlayson-Green
Director
Company registration number 02635454 (England and Wales)
THE DARENT WAX COMPANY LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2023
- 9 -
Share capital
Share premium account
Revaluation reserve
Capital redemption reserve
Profit and loss reserves
Total
£
£
£
£
£
£
Period ended 31 March 2022
Balance at 1 April 2021
42,055
16,213
26,817
23,463
3,974,262
4,082,810
Year ended 31 March 2022:
Profit and total comprehensive income for the year
-
-
-
-
1,391,408
1,391,408
Dividends
-
-
-
-
(150,000)
(150,000)
Transfers
-
-
(2,682)
-
2,682
-
Balance at 31 March 2022
42,055
16,213
24,135
23,463
5,218,352
5,324,218
Year ended 31 March 2023:
Profit and total comprehensive income for the year
-
-
-
-
1,330,235
1,330,235
Dividends
-
-
-
-
(390,000)
(390,000)
Transfers
-
-
(2,413)
-
2,413
-
Balance at 31 March 2023
42,055
16,213
21,722
23,463
6,161,000
6,264,453
THE DARENT WAX COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
- 10 -
1
Accounting policies
Company information
The Darent Wax Company Limited is a private company limited by shares incorporated in England and Wales. The registered office is 1 The Mills, Station Road, South Darenth, Kent, DA4 9BD.
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.
This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements:
Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;
Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues’: Interest income/expense and net gains/losses for each category of financial instrument; loan defaults or breaches;
Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.
The financial statements of the company are consolidated in the financial statements of Darent Wax Group Limited. These consolidated financial statements are available from its registered office, 1 The Mills, Station Road, South Darenth, Kent, DA4 9AU.
1.2
Going concern
Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company 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.
1.3
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.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (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.
THE DARENT WAX COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 11 -
1.4
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:
Leasehold improvements
4% on cost
Plant and equipment
10% and 25% reducing balance, depending upon the estimated useful life of the asset
Fixtures and fittings
10% and 25% reducing balance, depending upon the estimated useful life of the asset
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 credited or charged to profit or loss.
1.5
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 are valued in the accounts on an average cost basis.
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.
1.6
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks and other short-term liquid investments with original maturities of three months or less.
1.7
Financial instruments
The company only has financial instruments which are classified as basic financial instruments.
Short-term debtors and creditors are measured at the settlement value. Any losses from impairment are recognised in profit and loss.
Bank loans are initially recorded at the transaction price including transaction costs. Subsequently, they are measured at amortised cost using the effective interest rate method.
1.8
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 company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
THE DARENT WAX COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 12 -
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.
1.9
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.
1.10
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.11
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.
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 leases asset are consumed.
1.12
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 other operating 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.
1.13
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.
THE DARENT WAX COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 13 -
2
Judgements and key sources of estimation uncertainty
In the application of the company’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.
Valuation of stock
The salaries of production staff are included within stock to accurately reflect all elements of production costs incurred. In order to calculate this, management increase the cost of finished goods by a flat 20%, to recognise the cost of direct labour invested into finished goods.
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.
Depreciation
Depreciation is calculated to write off the cost or valuation of assets over their estimated useful economic lives. See note 1.4 for specific rates.
3
Turnover and other revenue
An analysis of the company's turnover is as follows:
2023
2022
£
£
Turnover analysed by class of business
Wax Manufacture
13,565,105
11,591,958
2023
2022
£
£
Turnover analysed by geographical market
UK
5,998,657
4,975,441
Europe
2,825,300
2,439,867
Rest of the World
4,741,148
4,176,650
13,565,105
11,591,958
2023
2022
£
£
Other operating income
Grants received
-
27,388
THE DARENT WAX COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 14 -
4
Operating profit
2023
2022
Operating profit for the year is stated after charging/(crediting):
£
£
Exchange gains
(29,775)
(22,636)
Government grants
-
(27,388)
Fees payable to the company's auditor for the audit of the company's financial statements
7,000
6,000
Depreciation of owned tangible fixed assets
84,205
86,498
Depreciation of tangible fixed assets held under finance leases
43,474
17,773
Loss on disposal of tangible fixed assets
73
1,365
Operating lease charges
294,346
239,845
5
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Production staff
53
43
Other staff
23
28
Total
76
71
Their aggregate remuneration comprised:
2023
2022
£
£
Wages and salaries
1,836,537
1,570,963
Social security costs
166,578
128,860
Pension costs
90,020
89,161
2,093,135
1,788,984
6
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
212,747
205,130
Company pension contributions to defined contribution schemes
10,139
10,003
Benefits in kind
12,084
5,116
234,970
220,249
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 2 (2022 - 2).
THE DARENT WAX COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
6
Directors' remuneration
(Continued)
- 15 -
Remuneration disclosed above include the following amounts paid to the highest paid director:
2023
2022
£
£
Remuneration for qualifying services
68,325
67,492
Company pension contributions to defined contribution schemes
5,739
5,669
The highest paid director received no benefits in kind (2022: £Nil)
7
Interest payable and similar expenses
2023
2022
£
£
Interest on bank overdrafts and loans
18,673
44,193
Interest on finance leases and hire purchase contracts
10,688
3,067
29,361
47,260
8
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
256,449
307,070
Adjustments in respect of prior periods
(41,429)
(77,988)
Total current tax
215,020
229,082
Deferred tax
Origination and reversal of timing differences
118,755
(2,041)
Total tax charge
333,775
227,041
THE DARENT WAX COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
8
Taxation
(Continued)
- 16 -
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
1,664,010
1,618,449
Expected tax charge based on the standard rate of corporation tax in the UK of 19.00% (2022: 19.00%)
316,162
307,505
Tax effect of expenses that are not deductible in determining taxable profit
7,967
1,018
Permanent capital allowances in excess of depreciation
(67,679)
(1,453)
Research and development tax credit
(41,430)
(77,988)
Deferred tax movement
118,755
(2,041)
Taxation charge for the year
333,775
227,041
9
Tangible fixed assets
Leasehold improvements
Plant and equipment
Fixtures and fittings
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 April 2022
273,115
1,819,601
116,354
105,631
2,314,700
Additions
227,988
3,997
177,865
409,850
Disposals
(23,441)
(23,441)
At 31 March 2023
273,115
2,047,589
120,350
260,055
2,701,109
Depreciation and impairment
At 1 April 2022
31,412
1,185,684
93,073
60,480
1,370,649
Depreciation charged in the year
10,925
79,957
6,315
30,482
127,679
Eliminated in respect of disposals
(21,746)
(21,746)
At 31 March 2023
42,337
1,265,641
99,388
69,216
1,476,582
Carrying amount
At 31 March 2023
230,778
781,948
20,962
190,839
1,224,527
At 31 March 2022
241,703
633,917
23,281
45,151
944,052
THE DARENT WAX COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
9
Tangible fixed assets
(Continued)
- 17 -
The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.
2023
2022
£
£
Plant and equipment
136,470
29,930
Motor vehicles
167,971
43,342
304,441
73,272
10
Fixed asset investments
2023
2022
£
£
Unlisted investments
4
Movements in fixed asset investments
Investments
£
Cost or valuation
At 1 April 2022 & 31 March 2023
4
Impairment
At 1 April 2022
-
Impairment losses
4
At 31 March 2023
4
Carrying amount
At 31 March 2023
-
At 31 March 2022
4
11
Stocks
2023
2022
£
£
Raw materials and consumables
1,384,219
1,402,523
Work in progress
316,669
330,851
Finished goods and goods for resale
478,496
470,031
Consignment stock
116,862
-
2,296,246
2,203,405
THE DARENT WAX COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 18 -
12
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
2,153,458
1,757,373
Corporation tax recoverable
41,735
77,988
Amounts owed by group undertakings
2,431,861
2,254,710
Other debtors
12,626
63,050
Prepayments and accrued income
307,332
406,098
4,947,012
4,559,219
13
Creditors: amounts falling due within one year
2023
2022
Notes
£
£
Bank loans
14
168,000
168,000
Obligations under finance leases
16
65,687
16,127
Trade creditors
1,319,824
1,324,606
Corporation tax
72,682
248,530
Other taxation and social security
48,889
30,827
Other creditors
12,210
49,887
Accruals
75,344
63,802
1,762,636
1,901,779
14
Loans and overdrafts
2023
2022
£
£
Bank loans
532,000
700,000
Payable within one year
168,000
168,000
Payable after one year
364,000
532,000
The above bank loans are secured by fixed and floating charges over the assets of the company dated 5 February 2014 and 9 May 2017.
The loan bears interest at a rate of 2.99% and will be fully repaid by May 2026 as a result of monthly repayments.
THE DARENT WAX COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 19 -
15
Creditors: amounts falling due after more than one year
2023
2022
Notes
£
£
Bank loans and overdrafts
14
364,000
532,000
Obligations under finance leases
16
162,478
10,704
526,478
542,704
16
Finance lease obligations
2023
2022
Future minimum lease payments due under finance leases:
£
£
Within one year
65,687
16,127
In two to five years
162,478
10,704
228,165
26,831
Finance lease payments represent rentals payable by the company 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. Hire purchase interest of £10,688 (2022 - £3,067) was incurred in the year. Finance leases are secured against the assets to which they relate.
17
Provisions for liabilities
2023
2022
£
£
Deferred tax liabilities
18
268,088
149,333
18
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:
Liabilities
Liabilities
2023
2022
Balances:
£
£
Accelerated capital allowances
268,088
149,333
THE DARENT WAX COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
18
Deferred taxation
(Continued)
- 20 -
2023
Movements in the year:
£
Liability at 1 April 2022
149,333
Charge to profit or loss
118,755
Liability at 31 March 2023
268,088
19
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
90,020
89,161
The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.
20
Share capital
2023
2022
Ordinary share capital
£
£
Issued and fully paid
42,053 Ordinary shares of £1 each
42,053
42,053
2 Ordinary A shares of £1 each
2
2
42,055
42,055
21
Financial commitments, guarantees and contingent liabilities
There is a fixed and floating charge dated 28 June 2021 over the assets of The Darent Wax Company Limited in respect of an amount due to a director of the ultimate parent company, The Darent Wax Group Limited. The amount owed by the ultimate parent company in respect of this security at 31 March 2023 is £1,080,000 (2022: £1,440,000).
In addition, there is also a fixed and floating cross-guarantee in respect of loans held by the parent company, Darent Wax Holdings Limited. This charge is dated 16 May 2017. The amount owed by the parent company under this guarantee at 31 March 2023 amounted to £1,738,688 (2022: £1,833,712).
THE DARENT WAX COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 21 -
22
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
2023
2022
£
£
Within one year
71,246
94,994
Between two and five years
71,246
71,246
166,240
23
Related party transactions
The following amounts were outstanding at the reporting end date:
2023
2022
Amounts due from related parties
£
£
Other related parties
-
8,386
Other information
At the year end, £2,918 was owed to The Darent Wax Company Limited by Huckle Limited (2022: £2,918), an entity controlled by a close family member of key management personnel.
During the year, payments were made in support of Darent Wax SAS, an entity controlled by a member of key management personnel. Payments of £4,127 were made to the entity during the year (2022: £3,007). At the year end, £9,595 was owed to The Darent Wax Company Limited (2022: £5,468).
24
Prior period adjustment
Whilst preparing the financial statements an adjustment was made to better classify costs between cost of sales and administrative expenses. As a result, prior year cost of sales have risen by £288,998, whilst administrative expenses have reduced by £288,998, as shown in the statement of comprehensive income.
This adjustment does not effect equity or the balance sheet.
25
Ultimate controlling party
The ultimate parent company is The Darent Wax Group Limited and consolidated accounts are produced by this company. Their address is 1 The Mills, Station Road, South Darenth, Kent, DA4 9DB.
There is no ultimate controlling party of The Darent Wax Group Limited.
2023-03-312022-04-01falseCCH SoftwareCCH Accounts Production 2023.200Mr L Finlayson-GreenMr AC WardMr TA WardMr RE ParkerMrs J Ward1330235026354542022-04-012023-03-3102635454bus:Director12022-04-012023-03-3102635454bus:Director22022-04-012023-03-3102635454bus:Director32022-04-012023-03-3102635454bus:Director42022-04-012023-03-3102635454bus:CompanySecretary12022-04-012023-03-3102635454bus:RegisteredOffice2022-04-012023-03-31026354542021-04-012022-03-3102635454countries:UnitedKingdom2022-04-012023-03-3102635454countries:UnitedKingdom2021-04-012022-03-3102635454countries:Europe2022-04-012023-03-3102635454countries:Europe2021-04-012022-03-3102635454countries:OtherCountriesRegions2022-04-012023-03-3102635454countries:OtherCountriesRegions2021-04-012022-03-31026354542023-03-3102635454core:RetainedEarningsAccumulatedLosses2021-04-012022-03-3102635454core:RetainedEarningsAccumulatedLosses2022-04-012023-03-31026354542022-03-3102635454core:LeaseholdImprovements2023-03-3102635454core:PlantMachinery2023-03-3102635454core:FurnitureFittings2023-03-3102635454core:MotorVehicles2023-03-3102635454core:LeaseholdImprovements2022-03-3102635454core:PlantMachinery2022-03-3102635454core:FurnitureFittings2022-03-3102635454core:MotorVehicles2022-03-3102635454core:CurrentFinancialInstrumentscore:WithinOneYear2023-03-3102635454core:CurrentFinancialInstrumentscore:WithinOneYear2022-03-3102635454core:Non-currentFinancialInstrumentscore:AfterOneYear2023-03-3102635454core:Non-currentFinancialInstrumentscore:AfterOneYear2022-03-3102635454core:CurrentFinancialInstruments2023-03-3102635454core:CurrentFinancialInstruments2022-03-3102635454core:Non-currentFinancialInstruments2023-03-3102635454core:Non-currentFinancialInstruments2022-03-3102635454core:ShareCapital2023-03-3102635454core:ShareCapital2022-03-3102635454core:SharePremium2023-03-3102635454core:SharePremium2022-03-3102635454core:RevaluationReserve2023-03-3102635454core:RevaluationReserve2022-03-3102635454core:CapitalRedemptionReserve2023-03-3102635454core:CapitalRedemptionReserve2022-03-3102635454core:RetainedEarningsAccumulatedLosses2023-03-3102635454core:RetainedEarningsAccumulatedLosses2022-03-3102635454core:ShareCapital2021-03-3102635454core:SharePremium2021-03-3102635454core:RevaluationReserve2021-03-3102635454core:CapitalRedemptionReserve2021-03-3102635454core:RetainedEarningsAccumulatedLosses2021-03-31026354542021-03-3102635454core:ShareCapitalOrdinaryShares2023-03-3102635454core:ShareCapitalOrdinaryShares2022-03-3102635454core:RevaluationReserve2021-04-012022-03-3102635454core:RevaluationReserve2022-04-012023-03-3102635454core:LeaseholdImprovements2022-04-012023-03-3102635454core:PlantMachinery2022-04-012023-03-3102635454core:FurnitureFittings2022-04-012023-03-3102635454core:MotorVehicles2022-04-012023-03-3102635454core:OwnedAssets2022-04-012023-03-3102635454core:OwnedAssets2021-04-012022-03-3102635454core:LeasedAssets2022-04-012023-03-3102635454core:LeasedAssets2021-04-012022-03-3102635454bus:Director22021-04-012022-03-3102635454core:UKTax2022-04-012023-03-3102635454core:UKTax2021-04-012022-03-310263545412022-04-012023-03-310263545412021-04-012022-03-3102635454core:LeaseholdImprovements2022-03-3102635454core:PlantMachinery2022-03-3102635454core:FurnitureFittings2022-03-3102635454core:MotorVehicles2022-03-31026354542022-03-3102635454core:Non-currentFinancialInstrumentscore:UnlistedNon-exchangeTraded2023-03-3102635454core:Non-currentFinancialInstrumentscore:UnlistedNon-exchangeTraded2022-03-3102635454core:WithinOneYear2023-03-3102635454core:WithinOneYear2022-03-3102635454core:BetweenTwoFiveYears2023-03-3102635454core:BetweenTwoFiveYears2022-03-3102635454bus:OrdinaryShareClass22023-03-3102635454bus:OrdinaryShareClass12022-04-012023-03-3102635454bus:OrdinaryShareClass22022-04-012023-03-3102635454core:EntityControlledByKeyManagementPersonnel12023-03-3102635454core:EntityControlledByKeyManagementPersonnel12022-03-3102635454core:EntityControlledByKeyManagementPersonnel22023-03-3102635454core:EntityControlledByKeyManagementPersonnel22022-03-3102635454core:EntityControlledByKeyManagementPersonnel22022-04-012023-03-3102635454core:EntityControlledByKeyManagementPersonnel22021-04-012022-03-3102635454bus:PrivateLimitedCompanyLtd2022-04-012023-03-3102635454bus:FRS1022022-04-012023-03-3102635454bus:Audited2022-04-012023-03-3102635454bus:FullAccounts2022-04-012023-03-31xbrli:purexbrli:sharesiso4217:GBP