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SGH INVESTMENTS LIMITED
DIRECTORS' REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

 
SGH INVESTMENTS LIMITED
 

COMPANY INFORMATION


Directors
Mr N Skene 
Mr D Skene 
Mrs J Mason 




Registered number
08835158



Registered office
c/o Ashfords LLP
Ashford House

Grenadier Road

Exeter

EX1 3LH




Independent auditors
EQ Audit Services LLP (Statutory auditor)
Chartered Accountants

Pentland House

Saltire Centre

Glenrothes

Fife

KY6 2AH




Bankers
Bank of Scotland
9 Falkland Gate

Glenrothes

Fife

KY7 5LW




Solicitors
MacRoberts
10 George Street

Edinburgh

EH2 2PF





 
SGH INVESTMENTS LIMITED
 

CONTENTS



Page
Group strategic report
 
 
1
Directors' report
 
 
2 - 3
Independent auditors' report
 
 
4 - 7
Consolidated statement of comprehensive income
 
 
8
Consolidated statement of financial position
 
 
9
Company statement of financial position
 
 
10 - 11
Consolidated statement of changes in equity
 
 
12
Company statement of changes in equity
 
 
13
Consolidated statement of cash flows
 
 
14 - 15
Consolidated analysis of net debt
 
 
16
Notes to the financial statements
 
 
17 - 37


 
SGH INVESTMENTS LIMITED
 

GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 30 JUNE 2023

Introduction
 
The directors have pleasure in presenting their strategic report for the year ended 30 June 2023.

Business review
 
The principal activities during the current year and the previous year were the operation of quarries and concrete product production.
Key performance indicators continue to be monitored over a number of areas.  Robust control over all aspects of working capital, strict monitoring of all aspects of cash flow and the monitoring of actual results against a detailed budget, including unit gross profit calculations for each physical unit of productive activity, by division.
The Group’s pre tax profit for the period was £3,679,361 whilst the Group’s balance sheet shows a net asset position of £20,537,817 with net current assets of £10,084,440 including a cash at bank and in hand figure of £8,458,524. Turnover increased by 11.3%.
Within the balance sheet tangible fixed assets total £14,221,867. It is the directors’ opinion that the open market value of these assets is in excess of the book figures, albeit this has not been independently valued or substantiated.  The underlying total value provides real comfort to the directors that the asset base is such that it underpins operations in such a way to allow the Group to take advantage of all manner of opportunities.   Additional  planning consent for a key site was granted during the period which has expanded the life for sand, gravel and hard rock mining.  The Group functions without the need to operate a bank overdraft.

Principal risks and uncertainties
 
In the construction sector the main commercial risks surround the level of general construction and housebuilding which is on-going at any time, in chosen geographical markets, needed to generate a requirement for the Group’s goods and services.  Other risks surround the timely and predictable supply of new commercial vehicles, plant and equipment together with the supply of raw materials in sufficient quantities and quality as well as the availability of staff across all disciplines. Those risks which the business finds itself exposed to are managed by a strong and experienced board of directors and management team.
The Group’s principal financial instruments comprise bank balances and hire purchase agreements.  There are currently no loan balances outstanding in any form.  The main purpose of these instruments is to finance operations.  Due to the nature of these financial instruments  there is no exposure to price risk.  In respect of bank balances the liquidity risk is managed by maintaining flexibility through the use of cash at bank resources.   In respect of hire purchase agreements, the liquidity risk is managed by ensuring there are sufficient liquid funds to meet scheduled repayments.

Safety and health, environment and quality
 
The Group recognises the importance of health and safety, environment and quality and has policies and procedures in place to ensure requirements are met at all times. 


This report was approved by the board on 31 October 2023 and signed on its behalf.



Mr N Skene
Director

Page 1

 
SGH INVESTMENTS LIMITED
 

 
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2023

The directors present their report and the financial statements for the year ended 30 June 2023.

Directors' responsibilities statement

The directors are responsible for preparing the Group strategic report, the Directors' report and the consolidated 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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), 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 the Group and of the profit or loss of the Group for that period.

 In preparing these financial statements, the directors are required to:


select suitable accounting policies for the Group's financial statements and then apply them consistently;

make judgments 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 Group 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 the Group and to enable them to ensure that the financial statements comply with the Companies Act 2006They are also responsible for safeguarding the assets of the Company and the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Results and dividends

The profit for the year, after taxation, amounted to £2,970,438 (2022 - £2,825,477).

Particulars of dividends paid are detailed in the notes to the accounts.

Directors

The directors who served during the year were:

Mr N Skene 
Mr D Skene 
Mrs J Mason 

Future developments

Core operations remain healthy and the directors consider the business to be in a strong financial position to exploit future opportunities.

Page 2

 
SGH INVESTMENTS LIMITED
 

 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023


Disclosure of information to auditors

Each of the persons who are directors at the time when this Directors' report is approved has confirmed that:
 
so far as the director is aware, there is no relevant audit information of which the Company and the Group's auditors are unaware, and

the director has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the Company and the Group's auditors are aware of that information.

Post balance sheet events

There have been no significant events affecting the Group since the year end.

This report was approved by the board on 31 October 2023 and signed on its behalf.
 





Mr N Skene
Director

Page 3

 
SGH INVESTMENTS LIMITED
 

 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SGH INVESTMENTS LIMITED
 

Opinion


We have audited the financial statements of SGH Investments Limited (the 'parent Company') and its subsidiaries (the 'Group') for the year ended 30 June 2023, which comprise the Consolidated statement of comprehensive income, the Consolidated statement of financial position, the Company statement of financial position, the Consolidated statement of cash flows, the Consolidated statement of changes in equity, the Company statement of changes in equity and the related notes, including a summary of significant accounting policiesThe 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 Group's and of the parent Company's affairs as at 30 June 2023 and of the Group's 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 Group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council's Ethical Standard and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.


Conclusions relating to going concern


In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.


Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Group's or the parent Company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.


Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.


Page 4

 
SGH INVESTMENTS LIMITED
 

 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SGH INVESTMENTS LIMITED (CONTINUED)


Other information


The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' report thereon. The directors are responsible for the other information contained within the Annual ReportOur 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.


Opinion 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 Group strategic report and the Directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the Group strategic report and the Directors' report have been prepared in accordance with applicable legal requirements.


Matters on which we are required to report by exception
 

In the light of the knowledge and understanding of the Group and the parent Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group strategic report or the Directors' report.


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


adequate accounting records have not been kept by the parent Company, or returns adequate for our audit have not been received from branches not visited by us; or
the parent Company 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.


Page 5

 
SGH INVESTMENTS LIMITED
 

 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SGH INVESTMENTS LIMITED (CONTINUED)


Responsibilities of directors
 

As explained more fully in the Directors' responsibilities statement set out on page 2, 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 Group's and the parent Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Group or the parent Company or to cease operations, or have no realistic alternative but to do so.


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 an Auditors' 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 Group financial statements.


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

We gained an understanding of the legal and regulatory framework applicable to the company and the industry in which it operates, and considered the risk of acts by the company that were contrary to applicable laws and regulations, including fraud. We designed audit procedures to respond to the risk, 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 deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion.
We focused on laws and regulations which could give rise to a material misstatement in the financial statements, including, but not limited to, the Companies Act 2006 and UK tax legislation. Our tests included agreeing the financial statement disclosures to underlying supporting documentation and enquiries with management. There are inherent limitations in the audit procedures described above 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 would become aware of it. We did not identify any key audit matters relating to irregularities, including fraud. As in all our audits, we also addressed the risk of management override of internal controls, including testing journals and evaluating whether there was evidence of bias by the directors that represented a risk of material misstatement due to fraud.


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 Auditors' report.


Page 6

 
SGH INVESTMENTS LIMITED
 

 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SGH INVESTMENTS LIMITED (CONTINUED)


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 2006Our 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 Auditors' 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.





Mark Gibson CA (Senior statutory auditor)
  
for and on behalf of
EQ Audit Services LLP (Statutory auditor)
 
Chartered Accountants
  
Pentland House
Saltire Centre
Glenrothes
Fife
KY6 2AH

31 October 2023
Page 7

 
SGH INVESTMENTS LIMITED
 

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2023

2023
2022
£
£

  

Turnover
 4 
28,294,578
25,412,910

Cost of sales
  
(22,631,073)
(20,006,006)

Gross profit
  
5,663,505
5,406,904

Administrative expenses
  
(1,925,705)
(1,615,758)

Other operating income
 5 
12,540
23,759

Operating profit
 6 
3,750,340
3,814,905

Interest receivable and similar income
 9 
76,090
5,877

Interest payable and similar expenses
 10 
(147,069)
(107,714)

Profit before taxation
  
3,679,361
3,713,068

Tax on profit
 11 
(708,923)
(887,591)

Profit for the financial year
  
2,970,438
2,825,477

Profit for the year attributable to:
  

Owners of the parent Company
  
2,970,438
2,825,477

  
2,970,438
2,825,477

There were no recognised gains and losses for 2023 or 2022 other than those included in the consolidated statement of comprehensive income.

There was no other comprehensive income for 2023 (2022:£NIL).

The notes on pages 17 to 37 form part of these financial statements.

Page 8

 
SGH INVESTMENTS LIMITED
REGISTERED NUMBER: 08835158

CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2023

2023
2022
£
£

Fixed assets
  

Tangible assets
 14 
14,221,867
11,941,738

Investment property
 16 
269,426
269,426

  
14,491,293
12,211,164

Current assets
  

Stocks
 17 
1,172,678
1,073,899

Debtors: amounts falling due within one year
 18 
6,399,216
7,005,702

Cash at bank and in hand
 19 
8,458,524
7,753,382

  
16,030,418
15,832,983

Creditors: amounts falling due within one year
 20 
(5,945,978)
(5,928,276)

Net current assets
  
 
 
10,084,440
 
 
9,904,707

Total assets less current liabilities
  
24,575,733
22,115,871

Creditors: amounts falling due after more than one year
 21 
(2,570,527)
(2,704,095)

Provisions for liabilities
  

Deferred taxation
 25 
(1,217,449)
(1,167,222)

Restoration provision
 26 
(249,940)
(227,175)

  
 
 
(1,467,389)
 
 
(1,394,397)

Net assets
  
20,537,817
18,017,379


Capital and reserves
  

Called up share capital 
 27 
19,600
19,600

Share premium account
 28 
8,816,235
8,816,235

Profit and loss account
 28 
11,701,982
9,181,544

Equity attributable to owners of the parent Company
  
20,537,817
18,017,379


The financial statements were approved and authorised for issue by the board and were signed on its behalf on 31 October 2023.




Mr N Skene
Director

The notes on pages 17 to 37 form part of these financial statements.

Page 9

 
SGH INVESTMENTS LIMITED
REGISTERED NUMBER: 08835158

COMPANY STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2023

2023
2022
£
£

Fixed assets
  

Tangible assets
 14 
14,221,867
11,941,738

Investments
 15 
2
2

Investment property
 16 
269,426
269,426

  
14,491,295
12,211,166

Current assets
  

Debtors: amounts falling due within one year
 18 
2,496,750
2,535,039

Cash at bank and in hand
 19 
7,396,695
7,086,502

  
9,893,445
9,621,541

Creditors: amounts falling due within one year
 20 
(1,804,667)
(1,952,647)

Net current assets
  
 
 
8,088,778
 
 
7,668,894

Total assets less current liabilities
  
22,580,073
19,880,060

  

Creditors: amounts falling due after more than one year
 21 
(2,570,527)
(2,704,095)

Provisions for liabilities
  

Deferred taxation
 25 
(1,218,248)
(1,168,057)

  
 
 
(1,218,248)
 
 
(1,168,057)

Net assets excluding pension asset
  
18,791,298
16,007,908

Net assets
  
18,791,298
16,007,908


Capital and reserves
  

Called up share capital 
 27 
19,600
19,600

Profit and loss account brought forward
  
15,988,308
14,667,891

Profit for the year
  
3,233,390
1,770,417

Other changes in the profit and loss account

  

(450,000)
(450,000)

Profit and loss account carried forward
  
18,771,698
15,988,308

  
18,791,298
16,007,908


Page 10

 
SGH INVESTMENTS LIMITED
REGISTERED NUMBER: 08835158

COMPANY STATEMENT OF FINANCIAL POSITION (CONTINUED)
AS AT 30 JUNE 2023

The financial statements were approved and authorised for issue by the board and were signed on its behalf on 31 October 2023.


Mr N Skene
Director

The notes on pages 17 to 37 form part of these financial statements.

Page 11

 
SGH INVESTMENTS LIMITED
 

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2023


Called up share capital
Capital reserve
Profit and loss account
Total equity

£
£
£
£

At 1 July 2022
19,600
8,816,235
9,181,544
18,017,379



Profit for the year
-
-
2,970,438
2,970,438

Dividends: Equity capital
-
-
(450,000)
(450,000)


At 30 June 2023
19,600
8,816,235
11,701,982
20,537,817



CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2022


Called up share capital
Capital reserve
Profit and loss account
Total equity

£
£
£
£

At 1 July 2021
19,600
8,816,235
6,806,067
15,641,902



Profit for the year
-
-
2,825,477
2,825,477

Dividends: Equity capital
-
-
(450,000)
(450,000)


At 30 June 2022
19,600
8,816,235
9,181,544
18,017,379


The notes on pages 17 to 37 form part of these financial statements.

Page 12

 
SGH INVESTMENTS LIMITED
 

COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2023


Called up share capital
Profit and loss account
Total equity

£
£
£

At 1 July 2022
19,600
15,988,308
16,007,908



Profit for the year
-
3,233,390
3,233,390

Dividends: Equity capital
-
(450,000)
(450,000)


At 30 June 2023
19,600
18,771,698
18,791,298



COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2022


Called up share capital
Profit and loss account
Total equity

£
£
£

At 1 July 2021
19,600
14,667,891
14,687,491



Profit for the year
-
1,770,417
1,770,417

Dividends: Equity capital
-
(450,000)
(450,000)


At 30 June 2022
19,600
15,988,308
16,007,908


The notes on pages 17 to 37 form part of these financial statements.

Page 13

 
SGH INVESTMENTS LIMITED
 

CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2023

2023
2022
£
£

Cash flows from operating activities

Profit for the financial year
2,970,438
2,825,477

Adjustments for:

Depreciation of tangible assets
2,495,783
2,484,297

(Profit)/loss on disposal of tangible assets
(375,828)
(694,269)

Government grants
-
(12,264)

Interest paid
147,069
107,714

Interest received
(76,090)
(5,877)

Taxation charge
708,923
887,591

(Increase) in stocks
(98,779)
(380,761)

Decrease/(increase) in debtors
606,486
(951,831)

Increase/(decrease) in creditors
252,181
(42,576)

Increase in provisions
22,765
25,876

Corporation tax (paid)
(715,699)
(566,607)

Net cash generated from operating activities

5,937,249
3,676,770


Cash flows from investing activities

Purchase of tangible fixed assets
(4,945,834)
(3,459,789)

Sale of tangible fixed assets
545,750
1,070,875

Government grants received
-
12,264

Interest received
76,090
5,877

HP interest paid
(136,614)
(82,378)

Net cash from investing activities

(4,460,608)
(2,453,151)
Page 14

 
SGH INVESTMENTS LIMITED
 

CONSOLIDATED STATEMENT OF CASH FLOWS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023


2023
2022

£
£



Cash flows from financing activities

Repayment of other loans
(492,264)
(616,415)

New hire purchase and finance leases
1,746,100
2,339,862

Repayment of hire purchase and finance leases
(1,564,880)
(1,260,847)

Dividends paid
(450,000)
(450,000)

Interest paid
(10,455)
(25,336)

Net cash used in financing activities
(771,499)
(12,736)

Net increase in cash and cash equivalents
705,142
1,210,883

Cash and cash equivalents at beginning of year
7,753,382
6,542,499

Cash and cash equivalents at the end of year
8,458,524
7,753,382


Cash and cash equivalents at the end of year comprise:

Cash at bank and in hand
8,458,524
7,753,382


The notes on pages 17 to 37 form part of these financial statements.

Page 15

 
SGH INVESTMENTS LIMITED
 

CONSOLIDATED ANALYSIS OF NET DEBT
FOR THE YEAR ENDED 30 JUNE 2023





At 1 July 2022
Cash flows
New hire purchase/
finance leases
At 30 June 2023
£

£

£

£

Cash at bank and in hand

7,753,382

705,142

-

8,458,524

Debt due after 1 year

(214,990)

214,990

-

-

Debt due within 1 year

(277,274)

277,274

-

-

Hire purchase

(3,841,196)

1,564,880

(1,746,100)

(4,022,416)


3,419,922
2,762,286
(1,746,100)
4,436,108

The notes on pages 17 to 37 form part of these financial statements.

Page 16

 
SGH INVESTMENTS LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

1.


General information

SGH Investments Limited is a private Company, limited by shares, domiciled in England, registration
number 08835158. The registered office is Ashford House, Grenadier Road, Exeter, EX1 3LH.
The financial statements are presented in Sterling which is the functional currency of the Company and
rounded to the nearest £.

2.Accounting policies

 
2.1

Basis of preparation of financial statements

The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.

The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires Group management to exercise judgment in applying the Group's accounting policies (see note 3).

The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of comprehensive income in these financial statements.

The following principal accounting policies have been applied:

 
2.2

Basis of consolidation

The consolidated financial statements present the results of the Company and its own subsidiaries ("the Group") as if they form a single entity. Intercompany transactions and balances between group companies are therefore eliminated in full.
The consolidated financial statements incorporate the results of business combinations using the purchase method. In the Statement of financial position, the acquiree's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquired operations are included in the Consolidated statement of comprehensive income from the date on which control is obtained. They are deconsolidated from the date control ceases.

Page 17

 
SGH INVESTMENTS LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

2.Accounting policies (continued)

 
2.3

Turnover

Turnover is recognised to the extent that it is probable that the economic benefits will flow to the Group and the turnover can be reliably measured. Turnover is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before turnover is recognised:

Sale of goods

Turnover from the sale of goods is recognised when all of the following conditions are satisfied:
the Group has transferred the significant risks and rewards of ownership to the buyer;
the Group retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;
the amount of turnover can be measured reliably;
it is probable that the Group will receive the consideration due under the transaction; and
the costs incurred or to be incurred in respect of the transaction can be measured reliably.

Rendering of services

Turnover from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:
the amount of turnover can be measured reliably;
it is probable that the Group will receive the consideration due under the contract;
the stage of completion of the contract at the end of the reporting period can be measured reliably; and
the costs incurred and the costs to complete the contract can be measured reliably.

 
2.4

Operating leases: the Group as lessee

Rentals paid under operating leases are charged to profit or loss on a straight-line basis over the lease term.

Benefits received and receivable as an incentive to sign an operating lease are recognised on a straight-line basis over the lease term, unless another systematic basis is representative of the time pattern of the lessee's benefit from the use of the leased asset.

 
2.5

Leased assets: the Group as lessee

Assets obtained under hire purchase contracts and finance leases are capitalised as tangible fixed assets. Assets acquired by finance lease are depreciated over the shorter of the lease term and their useful lives. Assets acquired by hire purchase are depreciated over their useful lives. Finance leases are those where substantially all of the benefits and risks of ownership are assumed by the company. 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 profit or loss so as to produce a constant periodic rate of charge on the net obligation outstanding in each period.

Page 18

 
SGH INVESTMENTS LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

2.Accounting policies (continued)

 
2.6

Government grants

Grants of a revenue nature are recognised in the Statement of Comprehensive Income in the same period as the related expenditure.
During the prior year the Company was in receipt of the following revenue grant in relation to the Covid-19 pandemic:
Coronavirus Job Retention Scheme (CJRS) which is recognised when receivable.

 
2.7

Finance costs

Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.

 
2.8

Pensions

SGH Investments Limited makes contributions to the D Skene Plant Hire Limited Retirement Benefit Scheme (1986). The assets of the scheme are held separately from those of the Company. The annual contributions payable are charged to the Statement of comprehensive income.
Skene Group Construction Services Limited operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations.
The contributions are recognised as an expense in the Consolidated statement of comprehensive income when they fall due. Amounts not paid are shown in other creditors as a liability in the Statement of financial position. The assets of the plan are held separately from the Group in independently administered funds.

Page 19

 
SGH INVESTMENTS LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

2.Accounting policies (continued)

 
2.9

Current and deferred taxation

The tax expense for the year comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.

The current tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the Company and the Group operate and generate income.

Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the reporting date, except that:
The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits;
Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met; and
Where they relate to timing differences in respect of interests in subsidiaries, associates, branches and joint ventures and the Group can control the reversal of the timing differences and such reversal is not considered probable in the foreseeable future.

Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.

Page 20

 
SGH INVESTMENTS LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

2.Accounting policies (continued)

 
2.10

Tangible fixed assets

Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using both the straight-line method and reducing balance basis.

Depreciation is provided on the following basis:

Freehold property
-
2% - 20% straight line or reducing balance
Plant and machinery
-
10% - 50% straight line or reducing balance
Motor vehicles
-
20% straight line
Mineral rights
-
written off over the estimated life of the quarry

The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.

  
2.11

Impairment of fixed assets and goodwill

Assets that are subject to depreciation or amortisation are assessed at each reporting date to determine whether there is any indication that the assets are impaired. Where there is any indication that an asset may be impaired, the carrying value of the asset (or cash-generating unit to which the asset has been allocated) is tested for impairment. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset's (or CGU's) fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (CGUs). Non-financial assets that have been previously impaired are reviewed at each reporting date to assess whether there is any indication that the impairment losses recognised in prior periods may no longer exist or may have decreased.

 
2.12

Investment property

Investment property is carried at fair value determined annually by the directors and derived from the current market rents and investment property yields for comparable real estate, adjusted if necessary for any difference in the nature, location or condition of the specific asset. No depreciation is provided. Changes in fair value are recognised in profit or loss.

 
2.13

Valuation of investments

Investments in subsidiaries are measured at cost less accumulated impairment.

Page 21

 
SGH INVESTMENTS LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

2.Accounting policies (continued)

 
2.14

Stocks

Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a weighted average basis. Work in progress and finished goods include labour and attributable overheads.
At each reporting date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in the Consolidated statement of comprehensive income.

 
2.15

Debtors

Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.

 
2.16

Cash and cash equivalents

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.

 
2.17

Creditors

Short term creditors are measured at the transaction price. Other financial liabilities are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.

 
2.18

Provisions for liabilities

Provisions are made where an event has taken place that gives the Group a legal or constructive obligation that probably requires settlement by a transfer of economic benefit, and a reliable estimate can be made of the amount of the obligation.
Provisions are charged as an expense to profit or loss in the year that the Group becomes aware of the obligation, and are measured at the best estimate at the reporting date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties.
When payments are eventually made, they are charged to the provision carried in the Statement of financial position.

 
2.19

Financial instruments

The Group has elected to apply the provisions of Section 11 “Basic Financial Instruments” of FRS 102 to all of its financial instruments.

Financial instruments are recognised in the Group's Statement of financial position when the Group 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.

Page 22

 
SGH INVESTMENTS LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

2.Accounting policies (continued)

 
2.20

Dividends

Equity dividends are recognised when they become legally payable. Interim equity dividends are recognised when paid. Final equity dividends are recognised when approved by the shareholders at an annual general meeting.

  
2.21

Restoration costs

When the Group is legally or contractually required to restore a quarry site the estimated costs of site restoration are accrued over the estimated operating life of the quarry on a site by site basis.
The Group estimates its total future costs requirements for these activities. The provisions have not been discounted as the effect of doing so would not be material.


3.


Judgments in applying accounting policies and key sources of estimation uncertainty

The most significant estimation within the Group's financial statements relates to depreciation, particularly plant and machinery depreciation. The directors review depreciation rates on a regular basis to ensure that the policy rates remain appropriate and fairly charge the cost of fixed assets over their predicted useful lives for each specific category of fixed asset. Although gains on sale of fixed assets are regularly achieved, this arises where assets are sold within their useful lives.
Other areas of significant estimation within the Group's financial statements relate to the timing of revenue recognition and valuation of stock and work in progress. The directors review the valuation methodology on a regular basis to ensure the carrying value of stock and work in progress remains appropriate. Due consideration is given to amounts realised following the year end in relation to stock and work in progress included in the financial statements at the year end.
Included within the financial statements is a restoration provision relating to the Lomond and Soutra quarries, which represents an estimate of the amount that would be required to be paid in order to discharge the Group's legal responsibilities in respect of the sites.


4.


Turnover

The whole of the turnover is attributable to construction supplies and services.

2023
2022
£
£

United Kingdom
28,294,578
25,412,910


All turnover arose within the United Kingdom.

Page 23

 
SGH INVESTMENTS LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

5.


Other operating income

2023
2022
£
£

Net rents receivable
12,540
11,495

Government grants receivable
-
12,264

12,540
23,759



6.


Operating profit

The operating profit is stated after charging:

2023
2022
£
£

Depreciation of tangible fixed assets
2,495,783
2,484,297

(Profit)/loss on sale of tangible fixed assets
(375,828)
(694,269)

Fees payable to the Group's auditor and its associates for the audit of the Company's annual financial statements
9,055
8,240

Other operating lease rentals
129,301
150,000

Defined contribution pension cost
233,707
162,979

Page 24

 
SGH INVESTMENTS LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

7.


Employees

Staff costs, including directors' remuneration, were as follows:


Group
Group
Company
Company
2023
2022
2023
2022
£
£
£
£


Wages and salaries
4,080,375
4,035,841
297,895
317,004

Social security costs
470,736
456,797
50,189
43,756

Cost of defined contribution scheme
233,707
162,979
62,000
-

4,784,818
4,655,617
410,084
360,760


The average monthly number of employees, including the directors, during the year was as follows:



Group
Group
Company
Company
        2023
        2022
        2023
        2022
            No.
            No.
            No.
            No.









Production staff
81
82
-
-



Administrative staff
9
9
-
-



Management staff
10
10
-
-



Directors
3
3
3
3

103
104
3
3


8.


Directors' remuneration

2023
2022
£
£

Directors' emoluments
351,323
387,134

Group contributions to defined contribution pension schemes
62,000
-

413,323
387,134


During the year retirement benefits were accruing to 2 directors (2022 - NIL) in respect of defined contribution pension schemes.

The highest paid director received remuneration of £245,449 (2022 - £235,976).

The value of the Group's contributions paid to a defined contribution pension scheme in respect of the highest paid director amounted to £22,000 (2022 - £NIL).

Page 25

 
SGH INVESTMENTS LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

9.


Interest receivable

2023
2022
£
£


Other interest receivable
76,090
5,877


10.


Interest payable and similar expenses

2023
2022
£
£


Other loan interest payable
10,455
25,336

Finance leases and hire purchase contracts
136,614
82,378

147,069
107,714


11.


Taxation


2023
2022
£
£

Corporation tax


Current tax on profits for the year
716,742
604,946

Adjustments in respect of previous periods
(58,046)
(100,649)

658,696
504,297


Total current tax
658,696
504,297

Deferred tax


Origination and reversal of timing differences
50,227
135,737

Changes to tax rates
-
247,557

Total deferred tax
50,227
383,294


Taxation on profit on ordinary activities
708,923
887,591
Page 26

 
SGH INVESTMENTS LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
 
11.Taxation (continued)


Factors affecting tax charge for the year

The tax assessed for the year is lower than (2022 - lower than) the standard rate of corporation tax in the UK of 20.5% (2022 - 19%). The differences are explained below:

2023
2022
£
£


Profit on ordinary activities before tax
3,679,361
3,713,068


Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 20.5% (2022 - 19%)
754,269
705,483

Effects of:


Expenses not deductible for tax purposes
1,791
835

Other differences leading to an increase (decrease) in the tax charge
2,011
1,789

Adjustments to tax charge in respect of prior periods
(58,046)
(100,649)

Change in tax rates leading to an increase (decrease) in taxation
8,898
280,133

Total tax charge for the year
708,923
887,591


Factors that may affect future tax charges

There was an increase in the UK corporation tax rate from 19% to 25% (effective from 1 April 2023) which was enacted in 2021. The 19% rate will continue to apply for companies with profits up to £50,000.


12.


Dividends

2023
2022
£
£


Ordinary B shares of £1 each
400,000
400,000


Ordinary D shares of £1 each
50,000
50,000

450,000
450,000


13.


Parent company profit for the year

The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of comprehensive income in these financial statements. The profit after tax of the parent Company for the year was £3,233,390 (2022 - £1,770,417).

Page 27

 
SGH INVESTMENTS LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

14.


Tangible fixed assets

Group






Freehold property
Plant and machinery
Motor vehicles
Mineral rights
Total

£
£
£
£
£



Cost or valuation


At 1 July 2022
1,161,647
19,010,377
1,008,225
2,955,030
24,135,279


Additions
2,179,181
2,594,185
172,468
-
4,945,834


Disposals
-
(1,579,558)
(98,346)
-
(1,677,904)



At 30 June 2023

3,340,828
20,025,004
1,082,347
2,955,030
27,403,209



Depreciation


At 1 July 2022
124,292
10,215,538
719,681
1,134,030
12,193,541


Charge for the year on owned assets
8,682
2,277,913
130,844
78,344
2,495,783


Disposals
-
(1,413,604)
(94,378)
-
(1,507,982)



At 30 June 2023

132,974
11,079,847
756,147
1,212,374
13,181,342



Net book value



At 30 June 2023
3,207,854
8,945,157
326,200
1,742,656
14,221,867



At 30 June 2022
1,037,355
8,794,839
288,544
1,821,000
11,941,738

The net book value of assets held under finance leases or hire purchase contracts, included above, are as follows:


2023
2022
£
£



Plant and machinery
5,232,086
5,035,855

Motor vehicles
-
6,659

5,232,086
5,042,514

Page 28

 
SGH INVESTMENTS LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

Company






Freehold property
Plant and machinery
Motor vehicles
Mineral rights
Total

£
£
£
£
£

Cost or valuation


At 1 July 2022
1,161,647
19,010,377
1,008,225
2,955,030
24,135,279


Additions
2,179,181
2,594,185
172,468
-
4,945,834


Disposals
-
(1,579,558)
(98,346)
-
(1,677,904)



At 30 June 2023

3,340,828
20,025,004
1,082,347
2,955,030
27,403,209



Depreciation


At 1 July 2022
124,292
10,215,538
719,681
1,134,030
12,193,541


Charge for the year on owned assets
8,682
2,277,913
130,844
78,344
2,495,783


Disposals
-
(1,413,604)
(94,378)
-
(1,507,982)



At 30 June 2023

132,974
11,079,847
756,147
1,212,374
13,181,342



Net book value



At 30 June 2023
3,207,854
8,945,157
326,200
1,742,656
14,221,867



At 30 June 2022
1,037,355
8,794,839
288,544
1,821,000
11,941,738






The net book value of assets held under finance leases or hire purchase contracts, included above, are as follows:


2023
2022
£
£



Plant and machinery
5,232,086
5,035,855

Motor vehicles
-
6,659

5,232,086
5,042,514

Page 29

 
SGH INVESTMENTS LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

15.


Fixed asset investments

Company





Investments in subsidiary companies

£



Cost or valuation


At 1 July 2022
2



At 30 June 2023
2






Net book value



At 30 June 2023
2



At 30 June 2022
2


Subsidiary undertakings


The following were subsidiary undertakings of the Company:

Name

Registered office

Principal activity

Class of shares

Holding

Skene Group Construction Services Limited
Skene House, Viewfield Industrial Estate, Glenrothes, Fife KY6 2RD
Operation of quarries, concrete product production and contract work
Ordinary
100%
Skene Group Quarries Limited
Skene House, Viewfield Industrial Estate, Glenrothes, Fife KY6 2RD
Dormant
Ordinary
100%

Page 30

 
SGH INVESTMENTS LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

16.


Investment property

Group


Investment property

£



Valuation


At 1 July 2022
269,426



At 30 June 2023
269,426

The 2023 valuations were made by the directors, on an open market value for existing use basis.






Company





Investment property

£



Valuation


At 1 July 2022
269,426



At 30 June 2023
269,426

The 2023 valuations were made by the directors, on an open market value for existing use basis.



17.


Stocks

Group
Group
2023
2022
£
£

Raw materials and consumables
208,948
207,514

Work in progress
963,730
866,385

1,172,678
1,073,899


Page 31

 
SGH INVESTMENTS LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

18.


Debtors

Group
Group
Company
Company
2023
2022
2023
2022
£
£
£
£


Trade debtors
5,975,898
6,390,258
-
-

Amounts owed by group undertakings
-
-
2,481,586
2,239,713

Prepayments and accrued income
423,318
615,444
15,164
295,326

6,399,216
7,005,702
2,496,750
2,535,039



19.


Cash and cash equivalents

Group
Group
Company
Company
2023
2022
2023
2022
£
£
£
£

Cash at bank and in hand
8,458,524
7,753,382
7,396,695
7,086,502



20.


Creditors: Amounts falling due within one year

Group
Group
Company
Company
2023
2022
2023
2022
£
£
£
£

Trade creditors
2,350,734
2,033,658
41,994
124

Corporation tax
315,783
372,786
148,019
141,695

Other taxation and social security
822,048
870,900
142,210
159,398

Obligations under finance lease and hire purchase contracts
1,451,889
1,352,091
1,451,889
1,352,091

Other creditors
563,462
553,200
-
-

Accruals and deferred income
442,062
468,367
20,555
22,065

Other loans
-
277,274
-
277,274

5,945,978
5,928,276
1,804,667
1,952,647


Secured loans
Hire purchase liabilities are secured over the assets to which they relate.

Page 32

 
SGH INVESTMENTS LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

21.


Creditors: Amounts falling due after more than one year

Group
Group
Company
Company
2023
2022
2023
2022
£
£
£
£

Other loans
-
214,990
-
214,990

Net obligations under finance leases and hire purchase contracts
2,570,527
2,489,105
2,570,527
2,489,105

2,570,527
2,704,095
2,570,527
2,704,095


Secured loans
Hire purchase liabilities are secured over the assets to which they relate.


22.


Loans


Analysis of the maturity of loans is given below:


Group
Group
Company
Company
2023
2022
2023
2022
£
£
£
£

Amounts falling due within one year

Other loans
-
277,274
-
277,274

Amounts falling due 1-2 years

Other loans
-
214,990
-
214,990

Amounts falling due 2-5 years


-
492,264
-
492,264



23.


Hire purchase and finance leases


Minimum lease payments under hire purchase fall due as follows:

Group
Group
Company
Company
2023
2022
2023
2022
£
£
£
£

Within one year
1,451,889
1,352,091
1,451,889
1,352,091

Between 1-5 years
2,570,527
2,489,105
2,570,527
2,489,105

4,022,416
3,841,196
4,022,416
3,841,196

Page 33

 
SGH INVESTMENTS LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

24.


Financial instruments

Group
Group
Company
Company
2023
2022
2023
2022
£
£
£
£

Financial assets

Financial assets measured at fair value through profit or loss
8,458,524
7,753,382
7,396,695
7,086,502

Financial assets that are debt instruments measured at amortised cost
5,975,898
6,390,258
2,481,586
2,309,713

14,434,422
14,143,640
9,878,281
9,396,215


Financial liabilities

Financial liabilities measured at amortised cost
(3,315,903)
(3,467,858)
(62,549)
(514,453)


Financial assets measured at fair value through profit or loss comprise cash at bank and in hand.


Financial assets measured at amortised cost comprise trade debtors and other loans.


Financial liabilities measured at amortised cost comprise trade creditors, accruals, other creditors and loans.


25.


Deferred taxation


Group



2023
2022


£

£






At beginning of year
1,167,222
783,928


Charged to profit or loss
50,227
383,294



At end of year
1,217,449
1,167,222

Page 34

 
SGH INVESTMENTS LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
 
25.Deferred taxation (continued)

Company


2023
2022


£

£






At beginning of year
1,168,057
784,895


Charged to profit or loss
50,191
383,162



At end of year
1,218,248
1,168,057

Group
Group
Company
Company
2023
2022
2023
2022
£
£
£
£

Accelerated capital allowances
1,218,248
1,168,057
1,218,248
1,168,057

Other timing differences
(799)
(835)
-
-

1,217,449
1,167,222
1,218,248
1,168,057


26.


Provisions


Group



Restoration provision

£





At 1 July 2022
227,175


Charged to profit or loss
22,765



At 30 June 2023
249,940

The provision for restoration costs relates to the Group's obligations to restore quarry sites.
The level of expenditure to be incurred in order to fulfill this obligation has been estimated based on experience of the Group and from calculations performed by external independent consultants.
The timing of this expenditure is dependent upon the rate of excavation and planning consents over a number of years.
The provision has increased during the year in the amount of £22,765 to reflect estimated costs accrued over the useful lives of the quarries operated by the Group.

Page 35

 
SGH INVESTMENTS LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

27.


Share capital

2023
2022
£
£
Allotted, called up and fully paid



11,600 Ordinary A shares of £1.00 each
11,600
11,600
3,500 Ordinary B shares of £1.00 each
3,500
3,500
4,000 Ordinary C shares of £1.00 each
4,000
4,000
500 Ordinary D shares of £1.00 each
500
500

19,600

19,600



28.


Reserves

Capital reserve account

The capital reserve includes amounts arising on the acquisition of subsidiary companies.

Profit and loss account

The profit and loss account includes all current and prior period retained profits and losses.


29.


Capital commitments




At 30 June 2023 the Group and Company had capital commitments as follows:


Group
Group
Company
Company
2023
2022
2023
2022
£
£
£
£

Contracted for but not provided in these financial statements
566,920
1,108,989
566,920
1,108,989


30.


Pension commitments

The Group operates a defined contribution pension scheme. The assets of the scheme are held separately from those of the Group in an independently administered fund. The pension cost charge represents contributions payable by the Group to the fund and amounted to £233,707 (2022 - £162,979). Contributions totalling £13,310 (2022 - £12,654) were payable to the fund at the balance sheet date.

Page 36

 
SGH INVESTMENTS LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

31.


Commitments under operating leases

At 30 June 2023 the Group and the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:


Group
Group
Company
Company
2023
2022
2023
2022
£
£
£
£

Not later than 1 year
14,808
151,907
14,808
1,907

Later than 1 year and not later than 5 years
29,616
600,954
29,616
954

Later than 5 years
-
637,500
-
-

44,424
1,390,361
44,424
2,861




32.


Related party transactions

The Company and Group has taken the exemption available under s33.1A of FRS 102 not to disclose transactions with other wholly owned members of the group.
During the year, the Group entered into the following transactions with other related parties:


2023
2022
£
£

Sales to other related parties other than group companies
7,200
7,500
Purchases from other related parties other than group companies
961,344
907,092
Rents paid to other related parties other than group companies
114,493
150,000
Loans due to other related parties other than group companies
-
(492,264)
Net trading balances due from/(to) other related parties other than group companies
(367,121)
(366,281)

The parent Company paid dividends during the period totalling £450,000 to directors (2022: £450,000). 
On 31 January 2023, SGH Investments Limited purchased 10 acres of land at Soutra Hills Quarries, Soutra Mains Farm from D Skene Plant Hire Limited Retirement Benefit Scheme (1986) for £1,600,000.


33.


Controlling party

The parent Company was under the control of Mr D Skene throughout the current and previous year. Mr D Skene is the majority shareholder.


Page 37