Company Registration No. SC195444 (Scotland)
CALEDONIAN PLYWOOD COMPANY LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2023
CALEDONIAN PLYWOOD COMPANY LIMITED
COMPANY INFORMATION
Directors
S McKelvie
D Bartlett
D J Kilpatrick
Secretary
S Logan
Company number
SC195444
Registered office
1 Cardowan Park
Tannochside Park
UDDINGSTON
G71 5PF
Auditor
Johnston Carmichael LLP
227 West George Street
Glasgow
G2 2ND
CALEDONIAN PLYWOOD COMPANY LIMITED
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3 - 6
Directors' responsibilities statement
7
Independent auditor's report
8 - 11
Profit and loss account
12
Balance sheet
13
Statement of changes in equity
14
Statement of cash flows
15
Notes to the financial statements
16 - 28
CALEDONIAN PLYWOOD COMPANY LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MAY 2023
- 1 -

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

Fair review of the business

During the year turnover and margins returned to pre-Covid levels of 2020 and before. We have continued to invest in capital equipment and to refine our manufacturing processes to achieve improvements in efficiency and reduction of our carbon footprint.

We expect tough trading conditions for our sheet material division in the coming year however with recent strong results we feel we are well placed to emerge from the economic turmoil all businesses in our sector are currently facing. Our manufacturing division has grown steadily in recent years and we expect this trend to continue with a very healthy order book in place.

 

The company’s key financial indicators for the year are summarised in the table below:

 

 

2023

2022

Change

 

£'000

£'000

%

Turnover

70,428

80,067

-12%

Gross Margin

8,647

17,316

-50%

Operating Profit

2,542

11,326

-78%

Shareholder Funds

17,995

16,638

8%

 

We continue our commitment to quality ensuring our mills have retained all quality accreditations.

Principal risks and uncertainties

The company’s principal financial instruments comprise cash and cash equivalents. Other financial assets and liabilities, such as trade creditors and loan against imports, arise directly from the company’s operating activities.

 

The main risks associated with the company’s financial assets and liabilities are set out below.

 

Liquidity risk

The company aims to mitigate liquidity risk in respect of bank borrowings by managing a balance between cash generation from operations and flexibility through the use of import financing and invoice factoring facilities.

 

Foreign currency risk

The company buys goods and services denominated in currencies other than sterling. As a result, the value of the company’s non-sterling purchases, financial assets and liabilities, cash flows can be affected significantly by movements in exchange rates.

 

The company adopts a conservative approach to currency risk management.

Section 172 statement

Section 172(1) of the Companies Act 2006 provides that a director of a company must act in a way that he considers, in good faith, would be most likely to promote the success of the company for the benefit of its members as a whole, and in doing so have regard (amongst other matters) to various other stakeholder interests – below are the six key factors:

 

CALEDONIAN PLYWOOD COMPANY LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
- 2 -
Stakeholder engagement

1. Shareholders

 

Shareholders provide funds that help run and grow our business and they expect a sustainable return.

 

Operational and finance meetings are held monthly with our shareholders, where we engage and exchange views, and monitor closely how the financial year is progressing. Formal chaired, minuted meetings are held quarterly where strategic, operational, and financial matters and reviewed and discussed, providing a platform for well-informed decision making.

 

2. Customers

 

Our customers are our lifeblood whom we value highly. They provide the opportunities which provides gainful employment for our people and a return for our shareholders.

 

Service to our customers is of prime importance, proactively build meaningful relationships with them, and we systematically seek feedback on how we are performing.

 

We also interact with our customers through framework agreements, tenders, and call orders.

 

We fully adhere to the standards set out and agreed through ISO:9001 and look for continuous improvement in all our business activities.

 

3. Our people

 

Our people provide the external services to our customers and support each other in that common goal. We are passionate about nurturing a highly motivated, well-trained, team-orientated workforce and ensuring effective communication to all.

 

Health & safety is of paramount importance in our business.

4. Suppliers

 

We fully support collaboration with our suppliers as it reduces the risk in our supply chain and strengthens the platform from which we provide a service to our customers.

 

We also interact with our suppliers through tenders, agreements, and purchase orders.

 

A quality and sustainable supply chain is key to our competitiveness and product certification through well-managed forests is vital.

 

5. Social Responsibility

 

We recognise that we have a responsibility to the wider community and environment; and as a responsible importer, commit to be as environmentally friendly as possible in all our endeavours.

On behalf of the board

S McKelvie
Director
13 October 2023
CALEDONIAN PLYWOOD COMPANY LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MAY 2023
- 3 -

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

Principal activities

The principal activity of the company continued to be that of sourcing and supply of plywood and the manufacturing of specialist fire doors and door sets.

Results and dividends

The results for the year are set out on page 12.

Ordinary dividends were paid amounting to £374,084. 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:

S McKelvie
D Bartlett
D J Kilpatrick
Auditor

The auditor, Johnston Carmichael LLP, is deemed to be reappointed under section 487(2) of the Companies Act 2006.

CALEDONIAN PLYWOOD COMPANY LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
- 4 -
Energy and carbon report

Caledonian Plywood Company Limited recognise that we have a responsibility to the environment and endeavour to be as environmentally friendly as possible in our business activities.

We recycle our waste and separate our wood waste and mixed recycling waste as well as our paper and food waste. We are audited by SEPA (Scottish Environmental Protection Agency) under the Packaging Waste Regulations.

We are both FSC® or PEFC™ Certified allowing us to offer Certified products from sustainable forests.

The environmental impact of our operations

We recognise our responsibility to mitigate the impact of our operations on climate change and are taking steps to reduce this wherever possible. 98% of the scope 2 electricity emissions within our operational control are purchased from sustainable energy and we remain focused on identifying and implementing energy saving measures across our organisational footprint.

For this financial year we have continued the procurement PHEV company cars with significantly lower emissions than in prior years and replaced 2 diesel powered forklifts with electric powered units and expect to replace the remaining diesel units by 31 May 2024. Since the year end we have replaced the first of our company cars with a full EV model.

Energy Use and Greenhouse Gas Emissions – Market Based

 

2023

2022

 

 

Energy Use kWh

Tonnes CO₂e

Energy Use kWh

Tonnes CO₂e

Scope 1 energy use & emissions from stationery combustion gas

302,461

55.22

333,962

61.17

Scope 1 energy use & emissions from mobile combustion, transport, and site fuel use

513,094

124.53

479,664

114.71

Scope 2 energy use & emissions from electricity - market based

528,810

1.89

496,478

1.75

Total energy use & greenhouse gas emissions

1,344,366

181.64

1,310,104

177.63

Greenhouse gas emissions per FTE

 

2.3899

 

2.2773

Greenhouse gas emissions per £ 100,000 revenue

 

0.2579

 

0.2219

 

Energy Use and Greenhouse Gas Emissions – Location Based

 

2023

2022

 

Energy Use kWh

Tonnes CO₂e

Energy Use kWh

Tonnes CO₂e

Scope 1 energy use & emissions from stationery combustion gas

302,461

55.22

333,962

61.17

Scope 1 energy use & emissions from mobile combustion, transport and site fuel use

513,095

124.53

479,663

114.71

Scope 2 energy use & emissions from electricity - location based

528,810

109.83

496,478

105.42

Total energy use & greenhouse gas emissions

1,344,366

289.58

1,310,103

281.30

 

Energy use in 2023 has increased compared to the previous year due to higher sales and volume performance from our Leeds manufacturing location.

CALEDONIAN PLYWOOD COMPANY LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
- 5 -

Methodology

Our Scope 1 and Scope 2 energy use and greenhouse gas emissions data for 2023 has been internally produced by the Company.

To calculate the footprint, data was collated from across the Company and from our suppliers to identify the amount of energy used in our operations. The Company uses the most robust and accurate data source available for each component of its energy use and carbon emission calculations. Assumptions and estimations are only used when strictly necessary by means of the most robust data and assumptions available.

Full data from both suppliers for energy, gas and gas oil supplies and internally generated data for company car and truck mileages was available for the year, no estimates have needed to be applied.

We do not consider refrigerant losses on our air conditioning units to be material and as such these are not reported in our emissions data. For business travel, the company analyses mileage information to establish the level of scope 1 emissions. Each vehicle’s respective CO2e g/km rating is applied. We do not consider non-company vehicle travel to be material and as such this is not reported in our emissions data.

For site diesel, usage is based on litres delivered to site within the financial period.

Greenhouse gas (GHG) emissions are calculated in line with GHG Reporting Protocol – Corporate standard and reported in line with the UK Government’s Guidance on Streamlined Energy and Carbon Reporting and mandatory GHG reporting guidance.

The boundary has been set based upon operational control approach on our business activities and property portfolio. Warehousing and site movements at Port of Tilbury which is controlled and operated by the Port are not included, nor are subcontracted logistics. There is 100% alignment with our financial reporting. 100% of our energy consumption and carbon emissions are UK based.

Matters addressed in the strategic report

The company has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the company's strategic report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the directors' report. It has done so in respect of future developments, engagement with suppliers, customers and others and financial risk management objectives and policies where applicable.

CALEDONIAN PLYWOOD COMPANY LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
- 6 -
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
S McKelvie
D Bartlett
Director
Director
13 October 2023
CALEDONIAN PLYWOOD COMPANY LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 MAY 2023
- 7 -

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

 

 

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the 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.

CALEDONIAN PLYWOOD COMPANY LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF CALEDONIAN PLYWOOD COMPANY LIMITED
- 8 -
Opinion

We have audited the financial statements of Caledonian Plywood Company Limited (the 'company') for the year ended 31 May 2023 which comprise the statement of comprehensive income, the balance sheet, the statement of changes in equity, the statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice). In our opinion the financial statements:

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor 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 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 the audit:

 

CALEDONIAN PLYWOOD COMPANY LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF CALEDONIAN PLYWOOD COMPANY LIMITED
- 9 -
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 and the directors' report.

 

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

 

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the 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 responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at: http://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.

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

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, 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 assessed whether the engagement team collectively had the appropriate competence and capabilities to identify or recognise non-compliance with laws and regulations by considering their experience, past performance and support available.

 

All engagement team members were briefed on relevant identified laws and regulations and potential fraud risks at the planning stage of the audit. Engagement team members were reminded to remain alert to any indications of fraud or non-compliance with laws and regulations throughout the audit.

CALEDONIAN PLYWOOD COMPANY LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF CALEDONIAN PLYWOOD COMPANY LIMITED
- 10 -

Extent to which the audit is considered capable of detecting irregularities, including fraud (continued)
We obtained an understanding of the legal and regulatory frameworks that are applicable to company and the sector in which it operates, focusing on those provisions that had a direct effect on the determination of material amounts and disclosures in the financial statements. The most relevant frameworks we identified include:

 

We gained an understanding of how the company is complying with these laws and regulations by making enquiries of management and those charged with governance. We corroborated these enquiries through our review of relevant correspondence with regulatory bodies and board meeting minutes.

 

We assessed the susceptibility of the financial statements to material misstatement, including how fraud might occur, by meeting with management and those charged with governance to understand where it was considered there was susceptibility to fraud. This evaluation also considered how management and those charged with governance were remunerated and whether this provided an incentive for fraudulent activity. We considered the overall control environment and how management and those charged with governance oversee the implementation and operation of controls. We identified a heightened fraud risk in relation to:

 

 

In addition to the above, the following procedures were performed to provide reasonable assurance that the financial statements were free of material fraud or error:

 

 

Our audit procedures were designed to respond to the risk of material misstatements in the financial statements, recognising that the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve intentional concealment, forgery, collusion, omission or misrepresentation. There are inherent limitations in the audit procedures performed and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we are to become aware of it.

CALEDONIAN PLYWOOD COMPANY LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF CALEDONIAN PLYWOOD COMPANY LIMITED
- 11 -

Use of our report

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members, as a body, for our audit work, for this report, or for the opinions we have formed.

James Hamilton (Senior Statutory Auditor)
For and on behalf of Johnston Carmichael LLP
13 October 2023
Chartered Accountants
Statutory Auditor
227 West George Street
Glasgow
G2 2ND
CALEDONIAN PLYWOOD COMPANY LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 MAY 2023
- 12 -
2023
2022
Notes
£
£
Turnover
2
70,427,676
80,067,128
Cost of sales
(62,017,846)
(62,750,638)
Gross profit
8,409,830
17,316,490
Distribution costs
(2,506,396)
(2,242,897)
Administrative expenses
(3,361,573)
(3,747,392)
Operating profit
3
2,541,861
11,326,201
Interest payable and similar expenses
7
(312,681)
(270,251)
Profit before taxation
2,229,180
11,055,950
Tax on profit
8
(490,556)
(2,142,883)
Profit and total comprehensive income for the financial year
1,738,624
8,913,067

The profit and loss account has been prepared on the basis that all operations are continuing operations.

CALEDONIAN PLYWOOD COMPANY LIMITED
BALANCE SHEET
AS AT
31 MAY 2023
31 May 2023
- 13 -
2023
2022
Notes
£
£
£
£
Fixed assets
Goodwill
10
1,575,000
1,800,000
Other intangible assets
10
31,300
46,948
Total intangible assets
1,606,300
1,846,948
Tangible assets
11
841,137
782,784
2,447,437
2,629,732
Current assets
Stocks
12
15,847,564
23,427,879
Debtors
13
13,274,985
15,388,106
Cash at bank and in hand
9,809
2,011
29,132,358
38,817,996
Creditors: amounts falling due within one year
14
(13,401,310)
(24,596,961)
Net current assets
15,731,048
14,221,035
Total assets less current liabilities
18,178,485
16,850,767
Creditors: amounts falling due after more than one year
15
-
0
(21,198)
Provisions for liabilities
Deferred tax liability
17
175,947
191,571
(175,947)
(191,571)
Net assets
18,002,538
16,637,998
Capital and reserves
Called up share capital
19
500,000
500,000
Profit and loss reserves
20
17,502,538
16,137,998
Total equity
18,002,538
16,637,998
The financial statements were approved by the board of directors and authorised for issue on 13 October 2023 and are signed on its behalf by:
S McKelvie
D Bartlett
Director
Director
Company Registration No. SC195444
CALEDONIAN PLYWOOD COMPANY LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MAY 2023
- 14 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 June 2021
500,000
9,320,931
9,820,931
Year ended 31 May 2022:
Profit and total comprehensive income for the year
-
8,913,067
8,913,067
Dividends
9
-
(2,096,000)
(2,096,000)
Balance at 31 May 2022
500,000
16,137,998
16,637,998
Year ended 31 May 2023:
Profit and total comprehensive income for the year
-
1,738,624
1,738,624
Dividends
9
-
(374,084)
(374,084)
Balance at 31 May 2023
500,000
17,502,538
18,002,538
CALEDONIAN PLYWOOD COMPANY LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MAY 2023
- 15 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
25
6,221,589
358,495
Interest paid
(312,681)
(270,251)
Income taxes paid
(1,445,941)
(2,075,155)
Net cash inflow/(outflow) from operating activities
4,462,967
(1,986,911)
Investing activities
Purchase of tangible fixed assets
(236,367)
(335,782)
Proceeds on disposal of tangible fixed assets
-
0
11,165
Net cash used in investing activities
(236,367)
(324,617)
Financing activities
Payment of finance leases obligations
(67,096)
(67,096)
Dividends paid
(374,084)
(2,096,000)
Net cash used in financing activities
(441,180)
(2,163,096)
Net increase/(decrease) in cash and cash equivalents
3,785,420
(4,474,624)
Cash and cash equivalents at beginning of year
(6,489,973)
(2,015,349)
Cash and cash equivalents at end of year
(2,704,553)
(6,489,973)
Relating to:
Cash at bank and in hand
9,809
2,011
Invoice finance
(2,714,362)
(6,491,984)
CALEDONIAN PLYWOOD COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2023
- 16 -
1
Accounting policies
Company information

Caledonian Plywood Company Limited is a private company limited by shares incorporated in Scotland. The registered office is 1 Cardowan Park, Tannochside Park, UDDINGSTON, G71 5PF.

1.1
Accounting convention

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

1.2
Going concern

At 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. The Directors have prepared detailed trading projections to the end of September 2024 based on current trading conditions and applied sensitivities to key assumptions. The sensitivities include the impact of a sustained and enforced downturn in demand arising from the current economic uncertainty.  true

 

Further, the Directors have assessed the appropriateness of the Company’s existing funding facilities and continued access to those funding facilities to meet the Company’s working capital requirements. The Directors are satisfied there is sufficient headroom in the Company’s existing funding facilities to meet its working capital requirements and have no reason to believe sufficient funding facilities will not be available. The projections and the company's performance in the year to 31 May 2023 provide the Directors’ with a reasonable expectation that the Company has sufficient funds in place to allow the Company to continue as a going concern for a minimum period of 12 months from the date of authorising the financial statements.  In making this assessment, the Directors acknowledge that forecasts are by nature forward looking and therefore may vary from actual results.

1.3
Turnover

Turnover represents amounts receivable from the sale of plywood and fire doors, net of VAT, trade 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 (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

1.4
Intangible fixed assets - goodwill

Goodwill represents the excess of the cost of acquisition of unincorporated businesses over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is 20 years.

 

It is reviewed for impairment at the end of the first accounting period following acquisition and in other periods if events or changes in circumstances indicate that the carrying value may not be recoverable.

CALEDONIAN PLYWOOD COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
1
Accounting policies
(Continued)
- 17 -
1.5
Intangible fixed assets other than goodwill

Intangible assets are represented by computer software. These are costs which are directly attributable to the production of identifiable and unique software products controlled by the company, that will probably generate economic benefits exceeding costs beyond one year. Direct costs include the costs of software development employees. Costs are amortised over their useful estimated lives.

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

Computer Software
3 years reducing balance
1.6
Tangible fixed assets

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

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

Plant and machinery
5 years reducing balance
Computer equipment
3 years reducing balance
Motor vehicles
4 years 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.

1.7
Impairment of fixed assets

At each reporting period end date, the company reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any).

1.8
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. Cost is based on the cost of purchase on a first in, first out basis.

1.9
Cash and cash equivalents

Cash and cash equivalents are basic financial assets and include cash in hand, bank overdrafts, invoice finance facilities and loans against imports. Bank overdrafts, invoice finance facilities and loans against imports are shown within borrowings in current liabilities.

1.10
Financial instruments

The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

 

Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.

 

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

CALEDONIAN PLYWOOD COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
1
Accounting policies
(Continued)
- 18 -
Basic financial assets

Basic financial assets, which include certain debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method. Financial assets classified as receivable within one year are not amortised.

Impairment of financial assets

Financial assets are assessed for indicators of impairment at each reporting end date.

 

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

Derecognition of financial assets

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

Classification of financial liabilities

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.

Basic financial liabilities

Basic financial liabilities, including certain creditors and loans are initially recognised at transaction price. Financial liabilities classified as payable within one year are not amortised.

 

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Derecognition of financial liabilities

Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.

1.11
Equity instruments

Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.

1.12
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.

CALEDONIAN PLYWOOD COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
1
Accounting policies
(Continued)
- 19 -
Deferred tax

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

 

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

1.13
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.

1.14
Retirement benefits

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

1.15
Leases

Assets obtained under hire purchase contracts are capitalised as tangible assets and depreciated over the shorter of the lease term and their useful lives. Obligations under such agreements are included in creditors net of finance charges 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, 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.

1.16
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.

 

Government grants are recognised in accordance with the performance model. A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.

1.17
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.

CALEDONIAN PLYWOOD COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
- 20 -
2
Turnover and other revenue

An analysis of the company's turnover is as follows:

2023
2022
£
£
Turnover analysed by class of business
Sheet Materials
63,345,820
74,024,346
Manufacturing
7,081,856
6,042,782
70,427,676
80,067,128

All of the company's turnover is generated within the UK.

3
Operating profit
2023
2022
Operating profit for the year is stated after charging:
£
£
Depreciation of owned tangible fixed assets
137,552
91,499
Depreciation of tangible fixed assets held under finance leases
40,462
53,358
Amortisation of intangible assets
240,648
248,470
Operating lease charges
303,532
282,930
CALEDONIAN PLYWOOD COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
- 21 -
4
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the company
29,350
23,300
For other services
Other taxation services
4,705
4,280
5
Employees

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

2023
2022
Number
Number
Administration
21
23
Sales
9
10
Warehouse and Distribution
8
8
Manufacturing
39
37
Total
77
78

Their aggregate remuneration comprised:

2023
2022
£
£
Wages and salaries
2,874,604
2,876,834
Social security costs
351,786
260,062
Pension costs
138,579
121,463
3,364,969
3,258,359
6
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
220,406
213,515
Remuneration disclosed above include the following amounts paid to the highest paid director:
2023
2022
£
£
Remuneration for qualifying services
74,613
72,306
CALEDONIAN PLYWOOD COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
- 22 -
7
Interest payable and similar expenses
2023
2022
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
38,351
108,608
Interest on invoice finance arrangements
268,918
156,231
307,269
264,839
Other finance costs:
Interest on finance leases and hire purchase contracts
5,412
5,412
312,681
270,251
8
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
506,243
2,100,466
Adjustments in respect of prior periods
(63)
-
0
Total current tax
506,180
2,100,466
Deferred tax
Origination and reversal of timing differences
(15,624)
42,417
Total tax charge
490,556
2,142,883

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

2023
2022
£
£
Profit before taxation
2,229,180
11,055,950
Expected tax charge based on the standard rate of corporation tax in the UK of 20.00% (2022: 19.00%)
445,836
2,100,631
Tax effect of expenses that are not deductible in determining taxable profit
3,782
3,817
Adjustments in respect of prior years
(63)
-
0
Fixed asset differences
44,124
28,256
Remeasurement of deferred tax for changes in tax rates
(3,123)
10,179
Taxation charge for the year
490,556
2,142,883
CALEDONIAN PLYWOOD COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
- 23 -
9
Dividends
2023
2022
£
£
Interim paid
374,084
2,096,000
10
Intangible fixed assets
Goodwill
Computer Software
Total
£
£
£
Cost
At 1 June 2022 and 31 May 2023
4,500,000
359,289
4,859,289
Amortisation and impairment
At 1 June 2022
2,700,000
312,341
3,012,341
Amortisation charged for the year
225,000
15,648
240,648
At 31 May 2023
2,925,000
327,989
3,252,989
Carrying amount
At 31 May 2023
1,575,000
31,300
1,606,300
At 31 May 2022
1,800,000
46,948
1,846,948
11
Tangible fixed assets
Assets under construction
Plant and machinery
Computer equipment
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 June 2022
-
0
1,347,842
204,735
235,756
1,788,333
Additions
92,236
122,132
21,999
-
0
236,367
At 31 May 2023
92,236
1,469,974
226,734
235,756
2,024,700
Depreciation and impairment
At 1 June 2022
-
0
727,859
147,111
130,579
1,005,549
Depreciation charged in the year
-
0
128,498
23,222
26,294
178,014
At 31 May 2023
-
0
856,357
170,333
156,873
1,183,563
Carrying amount
At 31 May 2023
92,236
613,617
56,401
78,883
841,137
At 31 May 2022
-
0
619,983
57,624
105,177
782,784
CALEDONIAN PLYWOOD COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
11
Tangible fixed assets
(Continued)
- 24 -

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 machinery
102,647
128,309
Motor vehicles
44,941
66,458
147,588
194,767
12
Stocks
2023
2022
£
£
Raw materials and consumables
713,690
714,679
Work in progress
142,672
53,395
Finished goods and goods for resale
10,996,873
16,334,653
Goods in transit
3,994,329
6,325,152
15,847,564
23,427,879

Finished goods and goods for resale above is stated net of provision for impairment of £344,766 (2022: £281,249).

13
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
12,546,242
13,929,645
Other debtors
557,007
1,358,937
Prepayments and accrued income
171,736
99,524
13,274,985
15,388,106

Trade debtors are stated after provision for impairment of £27,000 (2022: £15,000).

 

At the year end, the value of trade debt subject to an invoice finance agreement was £12,554,962 (2022: £13,941,194).

CALEDONIAN PLYWOOD COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
- 25 -
14
Creditors: amounts falling due within one year
2023
2022
Notes
£
£
Obligations under hire purchase
16
21,198
67,096
Trade creditors
2,617,361
5,205,475
Corporation tax
382,671
1,322,432
Other taxation and social security
1,056,051
2,306,321
Invoice finance
2,714,362
6,491,984
Accruals and deferred income
6,609,667
9,203,653
13,401,310
24,596,961

Obligations under hire purchase are secured on the assets to which they relate.

 

The invoice finance facility is secured by a floating charge over the assets of the company.

15
Creditors: amounts falling due after more than one year
2023
2022
Notes
£
£
Obligations under hire purchase
16
-
0
21,198

Obligations under hire purchase are secured on the assets to which they relate.

16
Hire purchase
2023
2022
Future minimum lease payments due under hire purchase:
£
£
Within one year
21,198
67,096
In two to five years
-
0
21,198
21,198
88,294

Hire purchase payments represent rentals payable by the company for certain items of plant and machinery. The average lease term is 5 years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.

CALEDONIAN PLYWOOD COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
- 26 -
17
Deferred taxation

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

Liabilities
Liabilities
2023
2022
Balances:
£
£
Fixed assets timing differences
189,780
195,321
Short term timing differences
(13,833)
(3,750)
175,947
191,571
2023
Movements in the year:
£
Liability at 1 June 2022
191,571
Credit to profit or loss
(15,624)
Liability at 31 May 2023
175,947
18
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
138,579
121,463

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.

As at 31 May 2023 included in creditors is a pension commitment of £24,581 (2022: £15,734)

19
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
500,000
500,000
500,000
500,000
20
Profit and loss reserves

Profit and loss reserves relates to retained cumulative profits and losses net of dividends paid.

CALEDONIAN PLYWOOD COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
- 27 -
21
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
275,825
215,602
Between two and five years
932,438
417,974
In over five years
760,000
14,213
1,968,263
647,789
22
Capital commitments

Amounts contracted for but not provided in the financial statements:

2023
2022
£
£
Acquisition of tangible fixed assets
132,679
-
23
Related party transactions
Transactions with related parties

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

Rental costs
2023
2022
£
£
Other related parties
66,667
100,000
24
Ultimate controlling party

D J Kilpatrick is deemed to be the controlling party of the company.

CALEDONIAN PLYWOOD COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
- 28 -
25
Cash generated from operations
2023
2022
£
£
Profit for the year after tax
1,738,624
8,913,067
Adjustments for:
Taxation charged
490,556
2,117,572
Finance costs
312,681
270,251
Amortisation and impairment of intangible assets
240,648
248,470
Depreciation and impairment of tangible fixed assets
178,014
144,857
Movements in working capital:
Decrease/(increase) in stocks
7,580,315
(14,041,100)
Decrease/(increase) in debtors
2,113,121
(122,395)
(Decrease)/increase in creditors
(6,706,792)
2,827,773
Cash generated from operations
5,947,167
358,495
Difference
274,422
-
Per cash flow statement page
6,221,589
358,495
26
Analysis of changes in net debt
1 June 2022
Cash flows
31 May 2023
£
£
£
Cash and cash equivalents
(6,489,973)
3,785,420
(2,704,553)
Obligations under finance leases
(88,294)
67,096
(21,198)
(6,578,267)
3,852,516
(2,725,751)
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