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REGISTERED NUMBER: SC067094 (Scotland)















Strategic Report, Report of the Directors and

Audited Financial Statements For The Year Ended 31 December 2022

for

T.S.L. Contractors Ltd.

T.S.L. Contractors Ltd. (Registered number: SC067094)






Contents of the Financial Statements
For The Year Ended 31 December 2022




Page

Company Information 1

Strategic Report 2

Report of the Directors 4

Report of the Independent Auditors 5

Statement of Comprehensive Income 9

Statement of Financial Position 10

Statement of Changes in Equity 11

Statement of Cash Flows 12

Notes to the Statement of Cash Flows 13

Notes to the Financial Statements 15


T.S.L. Contractors Ltd.

Company Information
For The Year Ended 31 December 2022







DIRECTORS: A D Knight
I Lumsden



REGISTERED OFFICE: Torosay Sandpit
Craignure
Isle of Mull
Argyll
PA65 6AY



REGISTERED NUMBER: SC067094 (Scotland)



INDEPENDENT AUDITORS: Robb Ferguson
Chartered Accountants & Statutory Auditors
Regent Court
70 West Regent Street
Glasgow
G2 2QZ



SOLICITORS: Twin Deer Law
Ben Nevis Auction Mart
Torlundy
Fort William
PH33 6SW

T.S.L. Contractors Ltd. (Registered number: SC067094)

Strategic Report
For The Year Ended 31 December 2022

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

REVIEW OF BUSINESS
The underlying performance of TSL for 2022 was positive across many of our business activities. Our overall turnover grew to £36.5m, a rise of 18% from 2021, however net profit of £231,522 before tax was some way below our potential and aspirational target.

This growth was primarily driven by the performance of our construction division. The corresponding anticipated profit levels were not however realised. This was primarily because of the detrimental impact of unpredictable extraordinary inflationary cost increases for the procurement of materials and subcontract services which were not recoverable within the contractual terms of several contracts entered into prior to these factors becoming so pronounced.

In addition to this construction industry wide issue, whilst our construction business performed well in its delivery of a growing number of larger projects, the business faced significant challenges on two specific construction projects which further diluted profitability. On one of these projects the main subcontractor engaged to undertake most of the works, went into administration leaving TSL to complete their subcontract works and the rectification of substantial defects in their works at significant cost to the business with no recourse to recover funds from the subcontractor. As a result of lessons learned from these projects, new improved construction management procedures, reporting structures and experienced key management personnel have been added and appointed.

Elsewhere in the business our Skyhook division, engaged mainly in helicopter lifting and construction works, performed very strongly in 2022, with a record year for the bracken spraying element of these operations, and an exceptional year for lifting, survey and precision vertical reference works. Skyhook has continued to broaden and strengthen its relationships with key customers and with indication towards the end of 2022 of significant mast construction works in remote areas suiting aircraft usage across the UK as part of the 'Notspot' and 'Partial Notspot' 4G/5G upgrades, is ideally placed to capitalise on these future works in 2023 and beyond.

Across the remainder of the business, the Quarrying, Haulage, Piers and Landscaping divisions performed in line with expectations and financial projections.

In Q3 of 2022, TSL took proactive steps to progressively reduce its carbon footprint by employing the services of an external sustainability consultant to provide education and support to our management team and employees on a journey to carbon neutrality and its contribution to saving the planet. The development of this plan will continue in 2023 in order that we can continue to support our customers on their own journeys and commitments to the attainment of zero carbon footprints.

Whilst 2022 has brought several unexpected challenges, it has reinforced the importance to TSL of recruiting and retaining the right people to deliver its aims, both strategically as the business seeks continued growth and consolidation of its position in the markets it serves, and practically, in its continual improvement of service delivery. Subsequently, as well as acting proactively to benchmark rates of pay locally and across the sectors it operates in, senior management have acted on employee feedback from welfare surveys and now offer healthcare packages as part of the wider remuneration package and are taking greater steps to communicate the company's wider performance and strategic aims to its employees in order to enable them to see their contribution to the company's future success and plan their longer term career and development with TSL. This fits well with wider government backed schemes to encourage workers into construction and related sectors particularly in the geographical areas the company operates in.

The outlook for 2023 and beyond is extremely positive and is based upon the businesses growing reputation for the delivery of quality services consistently across all business divisions. This is supported by the award in 2023 of several negotiated and repeat business works in both the private and public sectors. These include significant social housing commercial building and infrastructure construction projects. It has also secured places on several helicopter lifting and social housing and wider construction frameworks which will provide further opportunities for repeat business in 2023 and beyond.


T.S.L. Contractors Ltd. (Registered number: SC067094)

Strategic Report
For The Year Ended 31 December 2022

PRINCIPAL RISKS AND UNCERTAINTIES
Finance risk management objectives and policies
The company's operations expose it to a variety of financial risks that include the effects of changes in credit risk, liquidity risk and interest rate risk. The company seeks to limit the adverse effects on the financial performance by monitoring levels of debt finance and related finance costs.

Credit risk
The company has implemented a policy that requires credit checks on potential customers, where sales will be made on credit, before the transaction takes place. The amount of exposure to any individual counterparty is subject to limit which is regularly assessed by the directors.

Liquidity risk
The company aims to mitigate risk by managing cash generated by its operations.

Interest rate cash flow risk
While the company utilises external debt, its exposure to interest rate risk is kept to a minimum. The directors will revisit the appropriateness of this policy should the company's operations change in size or nature.

GOING CONCERN
The directors have assessed that the company has adequate resources to meet the ongoing costs of the business for a minimum of 12 months from the date of signing the financial statements. Accordingly, they continue to adopt the going concern basis in preparing the financial statements.

KEY PERFORMANCE INDICATORS
The directors have identified the following key financial performance indicators :

2022 2021
Turnover £36,451,497 £30,852,324
Gross profit 6% 9%
Net assets £6,366,227 £6,419,246

ON BEHALF OF THE BOARD:





A D Knight - Director


19 October 2023

T.S.L. Contractors Ltd. (Registered number: SC067094)

Report of the Directors
For The Year Ended 31 December 2022

The directors present their report with the financial statements of the company for the year ended 31 December 2022.

PRINCIPAL ACTIVITY
The principal activity of the company in the year under review was that of construction work, road haulage, supply of quarry materials and the provision of aviation services for the construction industry and other sectors.

DIVIDENDS
No interim dividend was paid during the year. The directors recommend a final dividend of £1.94 per share.

DIRECTORS
The directors shown below have held office during the whole of the period from 1 January 2022 to the date of this report.

A D Knight
I Lumsden

STATEMENT OF DIRECTORS' RESPONSIBILITIES
The directors are responsible for preparing the Strategic Report, the Report of the Directors 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), including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland'. 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 AS TO DISCLOSURE OF INFORMATION TO AUDITORS
So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and each director has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the company's auditors are aware of that information.

ON BEHALF OF THE BOARD:





A D Knight - Director


19 October 2023

Report of the Independent Auditors to the Members of
T.S.L. Contractors Ltd.

Opinion
We have audited the financial statements of T.S.L. Contractors Ltd. (the 'company') for the year ended 31 December 2022 which comprise the Statement of Comprehensive Income, Statement of Financial Position, Statement of Changes in Equity, Statement of Cash Flows and Notes to the Statement of Cash Flows, Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:
-give a true and fair view of the state of the company's affairs as at 31 December 2022 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.

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 Auditors' 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.

Other information
The directors are responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon.

Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether 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 the audit:
- the information given in the Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and
- the Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements.

Report of the Independent Auditors to the Members of
T.S.L. Contractors Ltd.


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 Report of the Directors.

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:
- 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 directors' remuneration specified by law are not made; or
- we have not received all the information and explanations we require for our audit.

Responsibilities of directors
As explained more fully in the Statement of Directors' Responsibilities set out on page four, 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 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.

Report of the Independent Auditors to the Members of
T.S.L. Contractors Ltd.


Auditors' 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 a Report of the Auditors that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud.

Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:
- The engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;
- We identified the laws and regulations applicable to the company through discussions with directors and other management, and from our wider knowledge and experience;
- We focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the company, including the Companies Act 2006 and FRS 102.
- We assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal correspondence; and
- Identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit.

We assessed the susceptibility of the company's financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:
- Making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; and
- Considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations

Audit response to risks identified
To address the risk of fraud through management bias and override of controls, we:
- Performed analytical procedures to identify any unusual or unexpected relationships;
- Tested journal entries to identify unusual transactions;
- Assessed whether judgements and assumptions made in determining the accounting estimates set out were indicative of potential bias; and
- Investigated the rationale behind significant or unusual transactions.

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:
- Agreeing financial statement disclosures to underlying supporting documentation;
- Enquiring of management as to actual and potential litigation and claims; and
- Requesting correspondence with HMRC, Companies House and the company's legal advisors.

There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.

Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors.

Report of the Independent Auditors to the Members of
T.S.L. Contractors Ltd.


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 a Report of the Auditors 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.




Janice Alexander (Senior Statutory Auditor)
for and on behalf of Robb Ferguson
Chartered Accountants & Statutory Auditors
Regent Court
70 West Regent Street
Glasgow
G2 2QZ

19 October 2023

T.S.L. Contractors Ltd. (Registered number: SC067094)

Statement of Comprehensive
Income
For The Year Ended 31 December 2022

2022 2021
Notes £    £   

TURNOVER 36,451,497 30,852,324

Cost of sales 34,368,855 28,114,303
GROSS PROFIT 2,082,642 2,738,021

Administrative expenses 1,975,528 1,729,249
107,114 1,008,772

Other operating income 250,000 14,325
OPERATING PROFIT 5 357,114 1,023,097


Interest payable and similar expenses 6 125,592 121,466
PROFIT BEFORE TAXATION 231,522 901,631

Tax on profit 7 227,571 (109,265 )
PROFIT FOR THE FINANCIAL YEAR 3,951 1,010,896

OTHER COMPREHENSIVE LOSS
Deferred tax on revaluation reserve (18,986 ) -
Income tax relating to other comprehensive
loss

-

-
OTHER COMPREHENSIVE LOSS FOR
THE YEAR, NET OF INCOME TAX

(18,986

)

-
TOTAL COMPREHENSIVE
(LOSS)/INCOME FOR THE YEAR

(15,035

)

1,010,896

T.S.L. Contractors Ltd. (Registered number: SC067094)

Statement of Financial Position
31 December 2022

2022 2021
Notes £    £    £    £   
FIXED ASSETS
Tangible assets 10 7,052,652 7,401,335
Investments 11 80 80
7,052,732 7,401,415

CURRENT ASSETS
Stocks 12 1,279,616 1,268,026
Debtors 13 7,785,760 7,002,928
Cash at bank and in hand 1,071,123 1,008,908
10,136,499 9,279,862
CREDITORS
Amounts falling due within one year 14 7,902,907 7,219,942
NET CURRENT ASSETS 2,233,592 2,059,920
TOTAL ASSETS LESS CURRENT
LIABILITIES

9,286,324

9,461,335

CREDITORS
Amounts falling due after more than one
year

15

(1,987,792

)

(2,356,341

)

PROVISIONS FOR LIABILITIES 19 (932,305 ) (685,748 )
NET ASSETS 6,366,227 6,419,246

CAPITAL AND RESERVES
Called up share capital 20 21,800 21,800
Revaluation reserve 21 239,731 262,802
Capital redemption reserve 21 8,200 8,200
Retained earnings 21 6,096,496 6,126,444
SHAREHOLDERS' FUNDS 6,366,227 6,419,246

The financial statements were approved by the Board of Directors and authorised for issue on 19 October 2023 and were signed on its behalf by:





A D Knight - Director


T.S.L. Contractors Ltd. (Registered number: SC067094)

Statement of Changes in Equity
For The Year Ended 31 December 2022

Called up Capital
share Retained Revaluation redemption Total
capital earnings reserve reserve equity
£    £    £    £    £   

Balance at 1 January 2021 21,800 5,246,651 266,887 8,200 5,543,538

Changes in equity
Dividends - (135,188 ) - - (135,188 )
Total comprehensive income - 1,014,981 (4,085 ) - 1,010,896
Balance at 31 December 2021 21,800 6,126,444 262,802 8,200 6,419,246

Changes in equity
Dividends - (37,984 ) - - (37,984 )
Total comprehensive loss - 8,036 (23,071 ) - (15,035 )
Balance at 31 December 2022 21,800 6,096,496 239,731 8,200 6,366,227

T.S.L. Contractors Ltd. (Registered number: SC067094)

Statement of Cash Flows
For The Year Ended 31 December 2022

2022 2021
Notes £    £   
Cash flows from operating activities
Cash generated from operations 1 763,170 1,334,951
Interest paid (12,158 ) (11,779 )
Interest element of hire purchase payments
paid

(113,434

)

(109,687

)
Tax paid 305,160 -
Net cash from operating activities 942,738 1,213,485

Cash flows from investing activities
Purchase of tangible fixed assets (482,048 ) (1,143,653 )
Sale of tangible fixed assets 789,285 870,980
Net cash from investing activities 307,237 (272,673 )

Cash flows from financing activities
New loans in year - 210,000
Bank loan repayments in year (151,696 ) (96,002 )
Hire purchase repayments in year (960,367 ) (1,034,925 )
Amount withdrawn by directors (37,713 ) (96,796 )
Equity dividends paid (37,984 ) (135,188 )
Net cash from financing activities (1,187,760 ) (1,152,911 )

Increase/(decrease) in cash and cash equivalents 62,215 (212,099 )
Cash and cash equivalents at beginning of
year

2

1,008,908

1,221,007

Cash and cash equivalents at end of year 2 1,071,123 1,008,908

T.S.L. Contractors Ltd. (Registered number: SC067094)

Notes to the Statement of Cash Flows
For The Year Ended 31 December 2022

1. RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM
OPERATIONS
2022 2021
£    £   
Profit before taxation 231,522 901,631
Depreciation charges 985,456 825,613
Profit on disposal of fixed assets (194,920 ) (284,210 )
Finance costs 125,592 121,466
1,147,650 1,564,500
Increase in stocks (11,590 ) (24,298 )
Increase in trade and other debtors (1,050,279 ) (1,701,070 )
Increase in trade and other creditors 677,389 1,495,819
Cash generated from operations 763,170 1,334,951

2. CASH AND CASH EQUIVALENTS

The amounts disclosed on the Statement of Cash Flows in respect of cash and cash equivalents are in respect of these Statement of Financial Position amounts:

Year ended 31 December 2022
31.12.22 1.1.22
£    £   
Cash and cash equivalents 1,071,123 1,008,908
Year ended 31 December 2021
31.12.21 1.1.21
£    £   
Cash and cash equivalents 1,008,908 1,221,007


T.S.L. Contractors Ltd. (Registered number: SC067094)

Notes to the Statement of Cash Flows
For The Year Ended 31 December 2022

3. ANALYSIS OF CHANGES IN NET DEBT

Other
non-cash
At 1.1.22 Cash flow changes At 31.12.22
£    £    £    £   
Net cash
Cash at bank
and in hand 1,008,908 62,215 1,071,123
1,008,908 62,215 1,071,123
Debt
Finance leases (2,653,892 ) 960,367 (749,090 ) (2,442,615 )
Debts falling due
within 1 year (147,012 ) 30,204 - (116,808 )
Debts falling due
after 1 year (532,906 ) 121,492 - (411,414 )
(3,333,810 ) 1,112,063 (749,090 ) (2,970,837 )
Total (2,324,902 ) 1,174,278 (749,090 ) (1,899,714 )

T.S.L. Contractors Ltd. (Registered number: SC067094)

Notes to the Financial Statements
For The Year Ended 31 December 2022

1. STATUTORY INFORMATION

T.S.L. Contractors Ltd. is a private company, limited by shares , registered in Scotland. The company's registered number and registered office address can be found on the Company Information page.

The presentation currency of the financial statements is the Pound Sterling (£).


2. ACCOUNTING POLICIES

Basis of preparing the financial statements
These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention as modified by the revaluation of certain assets.

Turnover
Turnover is stated net of VAT and trade discounts. Turnover from the sale of goods is recognised when the goods are physically delivered to the customer. Turnover from the supply of services represents the value of services provided under contracts to the extent that there is a right to consideration and is recorded at the value of the consideration due. Where a contract has only been partially completed at the balance sheet date turnover represents the value of the service provided to the date based on a proportion of the total contract value. Where payments are received from customers in advance of services provided, the amounts are recorded as deferred income and included as part of creditors due within one year.

Profit is recognised on long-term contracts, if the final outcome can be assessed with reasonable certainty, by including in the profit and loss account turnover and related costs as contract activity progresses. Turnover is calculated by reference to the value of work performed to date as a proportion of the total contract value.

Tangible fixed assets
Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life or, if held under finance lease, over the lease term, whichever is shorter.

Land and buildings freehold - 2% and 5% straight line
Plant and machinery - 6%, 10%, 15%, 20%, 25% and 30% reducing balance
Fixtures and fittings - 7.5%, 15%, 20%, 25%, 40% reducing balance
Motor vehicles - 20%, 25%, 30% and 33% reducing balance

Tangible fixed assets other than freehold land are stated at cost or valuation less depreciation.

Stocks and long term contracts
Stocks and work in progress are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items.

Cost is calculated using the first-in, first-out method and includes all purchase, transport, and handling costs in bringing stocks to their present location and condition.

Amounts recoverable on long term contracts, which are included in debtors, are stated at the net sales value of the work done after provision for contingencies and anticipated future losses on contracts, less amounts received as progress payments on account. Excess progress payments are included in creditors as payments on account.

Financial instruments
Basic financial instruments are recognised at amortised cost, except for investments in non-convertible preference and non-puttable ordinary shares which are measured at fair value, with changes recognised in profit or loss. Derivative financial instruments are initially recorded at cost and thereafter at fair value with changes recognised in profit or loss.


T.S.L. Contractors Ltd. (Registered number: SC067094)

Notes to the Financial Statements - continued
For The Year Ended 31 December 2022

2. ACCOUNTING POLICIES - continued
Taxation
Taxation for the year comprises current and deferred tax. Tax is recognised in the Statement of Comprehensive Income, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the statement of financial position date.

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the statement of financial position date.

Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference.

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

Hire purchase and leasing commitments
Assets obtained under hire purchase contracts and finance leases are capitalised as tangible fixed assets and depreciated over the shorter of the lease term and their useful lives. Obligations under such agreements are included in creditors net of the finance charge allocated to future periods. The finance element of the rental payment is charged to the profit and loss account so as to produce a constant periodic rate of charge on the net obligation outstanding in each period.

Rentals payable under operating leases are charged against income on a straight line basis over the lease term.

Pension costs and other post-retirement benefits
The company operates a defined contribution scheme for the benefit of its employees. The assets of the scheme are held separately from those of the company on independently administered funds. Contributions payable are charged to the profit and loss account in the year they are payable.

Group accounts
The company is entitled to the exemption under section 402 of the Companies Act 2006 from the obligation to prepare group accounts.

T.S.L. Contractors Ltd. (Registered number: SC067094)

Notes to the Financial Statements - continued
For The Year Ended 31 December 2022

3. CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported for assets and liabilities reported at the balance sheet date and the amounts reported for revenue and expenses during the year. However, the nature of estimation means that actual outcomes could differ from those estimates. The following judgements and estimates have had the most significant effects on amounts recognised in the financial statements.

Depreciation

The estimates and assumptions used to determine the depreciation charge requires judgements to be made as regards asset useful lives and residual values. The useful lives and residual values of the company's fixed assets are determined by management at the time the asset is acquired and reviewed annually for appropriateness. The lives are based on historical experience with similar assets. Historically, changes in useful lives have not resulted in material changes to the company's depreciation charge.

Revenue Recognition

Revenue on long term contracts for services is recognised according to the stage of completion reached on the contract by measuring a proportion of costs incurred for work performed to total estimated costs.Estimating the costs to completion and therefore the total contract costs is a key judgement in respect of revenue recognition on these contracts. Management bases their judgements of revenue and the assessment of the expected outcome of each contract on the latest information available. This includes contract valuations, and forecast costs to complete. The estimates of the contract positions and the profit or loss earned to date is updated regularly and the impact of any change in the accounting estimates are reflected in the financial statements. See notes 13 for amounts recoverable on contracts and payments received on account.

Provisions

Liabilities are recognised where the Company has an obligation at the Statement of Financial Position date as a result of a past event and it is probable that a transfer of economic benefit will be required in settlement with the amount of the settlement able to be estimated reliably. Liabilities are recognised at the amount that the Company anticipates it will pay to settle the debt or the amount it has received as advance payments for the goods or services it must provide. Provisions are measured at the best estimate of the amounts required to settle the obligation. Where the effect of the time value of money is material, the provision is based on the present value of those amounts, discounted at the pre-tax discount rate that reflects the risks specific to the liability. The unwinding of the discount is recognised within interest payable and similar charges.

4. EMPLOYEES AND DIRECTORS
2022 2021
£    £   
Wages and salaries 6,632,477 5,465,450
Social security costs 656,993 505,477
Other pension costs 190,105 155,899
7,479,575 6,126,826

The average number of employees during the year was as follows:
2022 2021

Construction and haulage 150 122
Directors 2 2
Administrative staff 10 10
Other 16 24
178 158

T.S.L. Contractors Ltd. (Registered number: SC067094)

Notes to the Financial Statements - continued
For The Year Ended 31 December 2022

4. EMPLOYEES AND DIRECTORS - continued

2022 2021
£    £   
Directors' remuneration 216,352 209,148
Directors' pension contributions to money purchase schemes 16,703 16,253

Information regarding the highest paid director is as follows:
2022 2021
£    £   
Emoluments etc 167,935 159,156
Pension contributions to money purchase schemes 15,450 15,000

5. OPERATING PROFIT

The operating profit is stated after charging/(crediting):

2022 2021
£    £   
Other operating leases 173,768 114,413
Depreciation - owned assets 454,115 324,362
Depreciation - assets on hire purchase contracts 531,341 501,251
Profit on disposal of fixed assets (194,920 ) (284,210 )
Auditors' remuneration 13,300 11,500

6. INTEREST PAYABLE AND SIMILAR EXPENSES
2022 2021
£    £   
Bank and other loan interest 12,158 11,779
Hire purchase interest 113,434 109,687
125,592 121,466

7. TAXATION

Analysis of the tax charge/(credit)
The tax charge/(credit) on the profit for the year was as follows:
2022 2021
£    £   
Current tax:
UK corporation tax - (255,826 )

Deferred tax 227,571 146,561
Tax on profit 227,571 (109,265 )

UK corporation tax has been charged at 19% (2021 - 19%).

T.S.L. Contractors Ltd. (Registered number: SC067094)

Notes to the Financial Statements - continued
For The Year Ended 31 December 2022

7. TAXATION - continued

Reconciliation of total tax charge/(credit) included in profit and loss
The tax assessed for the year is higher than the standard rate of corporation tax in the UK. The difference is explained below:

2022 2021
£    £   
Profit before tax 231,522 901,631
Profit multiplied by the standard rate of corporation tax in the UK of 19%
(2021 - 19%)

43,989

171,310

Effects of:
Expenses not deductible for tax purposes 590 866
Capital allowances in excess of depreciation (107,387 ) (355,005 )
Timing differences 290,379 362,640
Tax losses carried back - (255,826 )
Provisions - (33,250 )

Total tax charge/(credit) 227,571 (109,265 )

Tax effects relating to effects of other comprehensive income

2022
Gross Tax Net
£    £    £   
Deferred tax on revaluation reserve (18,986 ) - (18,986 )

8. DIVIDENDS
2022 2021
£    £   
Ordinary shares of £1 each
Final 37,984 135,188

9. PENSION COMMITMENTS

The company operates a defined contribution pension scheme. The assets of the scheme are held separately from those of the company in an independently administered fund. The pension cost represents contributions payable by the company to the fund and amounted to £190,105 (2021: £155,899). At the period end date, no amounts were outstanding.

T.S.L. Contractors Ltd. (Registered number: SC067094)

Notes to the Financial Statements - continued
For The Year Ended 31 December 2022

10. TANGIBLE FIXED ASSETS
Land and Fixtures
buildings Plant and and Motor
freehold machinery fittings vehicles Totals
£    £    £    £    £   
COST OR VALUATION
At 1 January 2022 1,298,193 8,931,014 867,078 550,509 11,646,794
Additions 31,248 964,688 60,957 174,245 1,231,138
Disposals - (910,085 ) - - (910,085 )
At 31 December 2022 1,329,441 8,985,617 928,035 724,754 11,967,847
DEPRECIATION
At 1 January 2022 16,523 3,301,548 422,632 504,756 4,245,459
Charge for year 8,814 794,169 112,002 70,471 985,456
Eliminated on disposal - (315,720 ) - - (315,720 )
At 31 December 2022 25,337 3,779,997 534,634 575,227 4,915,195
NET BOOK VALUE
At 31 December 2022 1,304,104 5,205,620 393,401 149,527 7,052,652
At 31 December 2021 1,281,670 5,629,466 444,446 45,753 7,401,335

Included in cost or valuation of land and buildings is freehold land of £ 320,561 (2021 - £ 320,561 ) which is not depreciated.

Cost or valuation at 31 December 2022 is represented by:

Land and Fixtures
buildings Plant and and Motor
freehold machinery fittings vehicles Totals
£    £    £    £    £   
Valuation in 2015 770,000 - - - 770,000
Cost 559,441 8,985,617 928,035 724,754 11,197,847
1,329,441 8,985,617 928,035 724,754 11,967,847

If land and buildings had not been revalued they would have been included at the following historical cost:

2022 2021
£    £   
Cost 1,036,174 1,004,926
Aggregate depreciation 114,985 100,041

Land and buildings were valued on an open market basis on 20 February 2015 by DM Hall LLP .

The directors have considered the value for 31 December 2022 and have concluded that no change to current net book value is required.

T.S.L. Contractors Ltd. (Registered number: SC067094)

Notes to the Financial Statements - continued
For The Year Ended 31 December 2022

10. TANGIBLE FIXED ASSETS - continued

Fixed assets, included in the above, which are held under hire purchase contracts are as follows:
Plant and Motor
machinery vehicles Totals
£    £    £   
COST OR VALUATION
At 1 January 2022 4,673,859 45,816 4,719,675
Additions 653,504 142,745 796,249
Disposals (207,400 ) - (207,400 )
Transfer to ownership (310,103 ) - (310,103 )
At 31 December 2022 4,809,860 188,561 4,998,421
DEPRECIATION
At 1 January 2022 1,131,043 3,819 1,134,862
Charge for year 492,656 38,685 531,341
Eliminated on disposal (67,304 ) - (67,304 )
Transfer from/(to) ownership (204,986 ) - (204,986 )
At 31 December 2022 1,351,409 42,504 1,393,913
NET BOOK VALUE
At 31 December 2022 3,458,451 146,057 3,604,508
At 31 December 2021 3,542,816 41,997 3,584,813

11. FIXED ASSET INVESTMENTS
Unlisted
investments
£   
COST
At 1 January 2022
and 31 December 2022 5,079
PROVISIONS
At 1 January 2022
and 31 December 2022 4,999
NET BOOK VALUE
At 31 December 2022 80
At 31 December 2021 80

T.S.L. Contractors Ltd. (Registered number: SC067094)

Notes to the Financial Statements - continued
For The Year Ended 31 December 2022

11. FIXED ASSET INVESTMENTS - continued

The company's investments at the Statement of Financial Position date in the share capital of companies include the following:

Mull Developments Ltd
Registered office: Torosay Sandpit, Craignure, Isle Of Mull, Argyll, PA65 6AY
Nature of business: Dormant company
%
Class of shares: holding
Ordinary 99.98
31.7.22 31.7.21
£    £   
Aggregate capital and reserves (10,861 ) (10,861 )

TSL Landscaping Limited
Registered office: Torosay Sandpit, Craignure, Isle Of Mull, Scotland, PA65 6AY
Nature of business: Landscape service activities
%
Class of shares: holding
Ordinary 80.00
31.12.22 31.12.21
£    £   
Aggregate capital and reserves 100 100

12. STOCKS
2022 2021
£    £   
Raw materials 250,114 238,524
Land stocks and work-in- progress 1,029,502 1,029,502
1,279,616 1,268,026

13. DEBTORS
2022 2021
£    £   
Amounts falling due within one year:
Trade debtors 2,108,217 2,325,590
Amounts recoverable on long term contracts 3,666,726 2,571,259
Other debtors 254,104 3,580
Amounts owed by related parties 75,607 72,952
Directors' current accounts 37,713 -
Tax - 305,160
Prepayments and accrued income 831,997 839,909
6,974,364 6,118,450

T.S.L. Contractors Ltd. (Registered number: SC067094)

Notes to the Financial Statements - continued
For The Year Ended 31 December 2022

13. DEBTORS - continued
2022 2021
£    £   
Amounts falling due after more than one year:
Amounts recoverable on long
term contracts 811,396 884,478
811,396 884,478

Aggregate amounts 7,785,760 7,002,928

14. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
2022 2021
£    £   
Bank loans and overdrafts (see note 16) 116,808 147,012
Hire purchase contracts (see note 17) 866,237 830,457
Trade creditors 2,532,808 2,497,395
Social security and other taxes 196,461 291,555
VAT 191,980 218,022
Accruals and deferred income 3,998,613 3,235,501
7,902,907 7,219,942

15. CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE
YEAR
2022 2021
£    £   
Bank loans (see note 16) 411,414 532,906
Hire purchase contracts (see note 17) 1,576,378 1,823,435
1,987,792 2,356,341

16. LOANS

An analysis of the maturity of loans is given below:

2022 2021
£    £   
Amounts falling due within one year or on demand:
Bank loans 116,808 147,012

Amounts falling due between one and two years:
Bank loans - 1-2 years 118,419 117,928

Amounts falling due between two and five years:
Bank loans - 2-5 years 213,592 310,055

Amounts falling due in more than five years:

T.S.L. Contractors Ltd. (Registered number: SC067094)

Notes to the Financial Statements - continued
For The Year Ended 31 December 2022

16. LOANS - continued
2022 2021
£    £   
Amounts falling due in more than five years:
Repayable by instalments
Bank loans more 5 yr by instal 79,403 104,923

17. LEASING AGREEMENTS

Minimum lease payments fall due as follows:

Hire purchase contracts
2022 2021
£    £   
Net obligations repayable:
Within one year 866,237 830,457
Between one and five years 1,576,378 1,823,435
2,442,615 2,653,892

Non-cancellable operating leases
2022 2021
£    £   
Within one year 179,914 67,088
Between one and five years 212,770 145,801
392,684 212,889

18. SECURED DEBTS

The following secured debts are included within creditors:

2022 2021
£    £   
Bank loans 528,222 679,918
Hire purchase contracts 2,442,615 2,653,892
2,970,837 3,333,810

The Royal Bank of Scotland plc hold a standard security over land and buildings of the company together with a bond and floating charge over the whole of the assets of the company.

The bank also holds assignation of policies on the life of A D Knight, director, to the value of £275,000.

The obligations under hire purchase contracts are secured over the assets which the agreements relate to.

19. PROVISIONS FOR LIABILITIES
2022 2021
£    £   
Deferred tax 932,305 685,748

T.S.L. Contractors Ltd. (Registered number: SC067094)

Notes to the Financial Statements - continued
For The Year Ended 31 December 2022

19. PROVISIONS FOR LIABILITIES - continued

Deferred
tax
£   
Balance at 1 January 2022 685,748
Provided during year 227,571
Revaluation reserve movement 18,986
Balance at 31 December 2022 932,305

20. CALLED UP SHARE CAPITAL


Allotted, issued and fully paid:
Number: Class: Nominal 2022 2021
value: £    £   
21,800 Ordinary £1 21,800 21,800

21. RESERVES
Capital
Retained Revaluation redemption
earnings reserve reserve Totals
£    £    £    £   

At 1 January 2022 6,126,444 262,802 8,200 6,397,446
Profit for the year 3,951 3,951
Dividends (37,984 ) (37,984 )
Transfer to profit and loss account 4,085 (4,085 ) - -
Deferred tax movement - (18,986 ) - (18,986 )
At 31 December 2022 6,096,496 239,731 8,200 6,344,427

22. RELATED PARTY DISCLOSURES

Entities over which the entity has control, joint control or significant influence
2022 2021
£    £   
Amount due from related parties 75,607 72,952

Amounts are interest free and repayable on demand.

23. ULTIMATE CONTROLLING PARTY

The company is controlled by the director, A D Knight.