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Registered number: 13216065










D.A. PAK HOLDINGS LIMITED










ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 MARCH 2023

 
D.A. PAK HOLDINGS LIMITED
 
 
COMPANY INFORMATION


Directors
J A Brighton 
R A Brighton 
P A Teasdale (appointed 1 August 2022)




Registered number
13216065



Registered office
Mort House
Crowcrofts Road, Newstead Industrial Estate

Trentham

Stoke-On-Trent

Staffordshire

ST4 8HX




Independent auditors
Shorts
Chartered Accountants & Registered Auditor

2 Ashgate Road

Chesterfield

Derbyshire

S40 4AA




Bankers
National Westminster Bank plc





 
D.A. PAK HOLDINGS LIMITED
 

CONTENTS



Page
Group Strategic Report
 
1 - 2
Directors' Report
 
3 - 4
Independent Auditors' Report
 
5 - 8
Consolidated Statement of Comprehensive Income
 
9
Consolidated Balance Sheet
 
10
Company Balance Sheet
 
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 - 34


 
D.A. PAK HOLDINGS LIMITED
 
 
GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2023

Introduction
 
The directors present their strategic report for the year ended 31 March 2023.

Business review
 
The primary activity of the Group is the sale and distribution of innovative flexible packaging solutions, using products that are sourced from exclusive partners in the UK, Europe, and Asia.
The Group has grown largely because our Customers value our ability to respond quickly and reliably to customer needs.  This vital part of our service is managed from our head-office and main distribution centre, situated in Stoke-on-Trent, UK.  This location provides easy access to the UK’s motorway network and together with our selected logistics partners, we can provide additional storage facilities and fast-response distribution capabilities, to maintain the flexible customer response required.    
The war in Ukraine disrupted the global economy and supply chains, causing shortages and an increased cost base.  The resultant inflation has created a challenging trading environment, but we have been able to minimise this disruption for our clients thanks to the global spread of our supplier base. Despite the challenges, the Group traded strongly during 2023 increasing turnover and profitability over 2022 in line with the Group’s growth strategy.
Sales of £14.1M were ahead of budget, and margins were ahead of budget also.
Overheads in the period increased over the previous year, but after adjusting for accounting changes caused by the group restructuring at the end of the 2022 year, the net increases reflected an increased headcount, and greater sales and marketing activity levels.  These increased costs were more than covered by the increased profit generated in the year.
On 25 February 2022, a group restructure took place which involved the creation of a holding company, DA Pak Holdings Ltd to hold the property at Stoke, and the buyout and retirement of a founder director and shareholder, Mr M Poulter.
At the first anniversary of the restructure, the company is positioned well, and is ahead of the forecast trading profit position at £1.37M with an additional profit on disposal of the property of £0.62M. Therefore, the actual performance comprises sales growth higher than budgeted, but at significantly improved gross margins, which has delivered the excess profit even after increasing operating costs.
The quality of earnings has increased which is pleasing, and the business continues to be cash generative.  
The Directors are satisfied with the financial position of the Group.
Sustainability
The Group is committed to ensuring the sustainability of human, social, environmental, and economic resources and complies with all relevant environmental policies. 
The UK government implemented a plastic packaging tax in April 2022. The  in line with its manufacturing partners is implementing more sustainable products, where permissible supplying products containing a minimum of 30% recycled materials instead of virgin polymer. 
The Group is striving to further improve its ESG (Environmental, Sustainability, Governance) and has appointed an independent advisor to further improve strategy and policy moving forwards.
 

Page 1

 
D.A. PAK HOLDINGS LIMITED
 

GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023

Principal risks and uncertainties
 
Pricing
The Group is exposed to fluctuations in market prices of raw materials. This position is monitored daily but using our global network of suppliers, we can mitigate some of this risk.
Market
The flexible packaging industry within which the group operates is highly competitive. The Group understands and lives by its core values and strengths to ensure we maintain standards for both the Group and our customers. 
Credit risk
The Group vets all customers prior to conducting business.  Customers requiring a credit facility must pass our credit-check and must adhere to our terms and conditions of sale. Trade debtor balances are continuously monitored to minimising exposure to credit risks.
Foreign currency risk
The Group conducts limited trading in foreign currencies and doesn’t require the provision of accounts in foreign currencies. 

Future Developments
 
Continued challenging trading conditions remain in 2023, namely due to the ongoing conflict in Ukraine and rising interest rates in the UK. However, the Group is confident that based on the policies and strategy being implemented, it will deliver continued improvement in 2023.


This report was approved by the board on 30 October 2023 and signed on its behalf.



R A Brighton
Director

Page 2

 
D.A. PAK HOLDINGS LIMITED
 
 
 
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2023

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

Results and dividends

The profit for the year, after taxation and minority interests, amounted to £839,070 (2022 - £69,118).

Directors

The directors who served during the year were:

J A Brighton 
R A Brighton 
P A Teasdale (appointed 1 August 2022)

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.

Qualifying third party indemnity provisions

The directors have been granted a qualifying third party indemnity provision under section 234 of the Companies Act 2006. This indemnity does not provide cover in the event of a director acting fraudulently or dishonestly. 

Page 3

 
D.A. PAK HOLDINGS LIMITED
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 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.

Auditors

The auditorsShortswill be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

This report was approved by the board on 30 October 2023 and signed on its behalf.
 





R A Brighton
Director

Page 4

 
D.A. PAK HOLDINGS LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF D.A. PAK HOLDINGS LIMITED
 

Opinion


We have audited the financial statements of D.A. Pak Holdings Limited (the 'parent Company') and its subsidiaries (the 'Group') for the year ended 31 March 2023, which comprise the Group Statement of Comprehensive Income, the Group and Company Balance Sheets, the Group Statement of Cash Flows, the Group and 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 31 March 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 5

 
D.A. PAK HOLDINGS LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF D.A. PAK HOLDINGS 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 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.


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 6

 
D.A. PAK HOLDINGS LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF D.A. PAK HOLDINGS LIMITED (CONTINUED)


Responsibilities of directors
 

As explained more fully in the Directors' Responsibilities Statement set out on page 3, 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:

Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:

the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;
through discussions with the directors and other management and from our commercial knowledge and experience of the sectors that the Company operates in, we identified the laws and regulations applicable to the Company; and
focusing on the specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the Company, we assessed the extent of compliance with those laws and regulations identified above through making enquiries of management and inspecting relevant correspondence.

We assessed the susceptibility of the Company’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:

making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; and
considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations






Page 7

 
D.A. PAK HOLDINGS LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF D.A. PAK HOLDINGS LIMITED (CONTINUED)


To address the risk of fraud through management bias and override of controls, we:

performed analytical procedures to identify any unusual or unexpected relationships;
considered journal entries to identify unusual transactions;
assessed whether judgements and assumptions made in determining the accounting estimates were indicative of potential bias; and
investigated the rationale behind significant or unusual transactions.

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:

agreeing financial statement disclosures to underlying supporting documentation;
enquiring of management as to actual and potential litigation and claims; and
reviewing any correspondence with HMRC, relevant regulators and the Company’s legal advisors.

There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance.

Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.

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

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


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.





Howard Freeman BSc FCA (Senior Statutory Auditor)
  
for and on behalf of
Shorts
 
Chartered Accountants
Registered Auditor
  
2 Ashgate Road
Chesterfield
Derbyshire
S40 4AA

30 October 2023
Page 8

 
D.A. PAK HOLDINGS LIMITED
 
 
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2023

2023
2022
Note
£
£

  

Turnover
 4 
14,127,028
1,158,241

Cost of sales
  
(11,200,580)
(942,314)

Gross profit
  
2,926,448
215,927

Administrative expenses
  
(1,573,106)
(114,914)

Operating profit
 5 
1,353,342
101,013

Interest receivable and similar income
 9 
70
2

Interest payable and similar expenses
 10 
(115,304)
(1,461)

Profit before taxation
  
1,238,108
99,554

Tax on profit
 11 
(304,906)
(25,160)

Profit for the financial year
  
933,202
74,394

  

  

Total comprehensive income for the year
  
933,202
74,394

Profit for the year attributable to:
  

Non-controlling interests
  
94,132
5,276

Owners of the parent Company
  
839,070
69,118

  
933,202
74,394

The notes on pages 17 to 34 form part of these financial statements.

Page 9

 
D.A. PAK HOLDINGS LIMITED
REGISTERED NUMBER: 13216065

CONSOLIDATED BALANCE SHEET
AS AT 31 MARCH 2023

2023
2022
Note
£
£

Fixed assets
  

Intangible assets
 13 
2,196,817
2,449,078

Tangible assets
 14 
2,017,288
1,988,221

  
4,214,105
4,437,299

Current assets
  

Stocks
 16 
3,699,661
4,044,031

Debtors: amounts falling due within one year
 17 
2,359,016
3,100,281

Cash at bank and in hand
 18 
172,810
180,789

  
6,231,487
7,325,101

Creditors: amounts falling due within one year
 19 
(4,915,087)
(6,441,622)

Net current assets
  
 
 
1,316,400
 
 
883,479

Total assets less current liabilities
  
5,530,505
5,320,778

Creditors: amounts falling due after more than one year
 20 
(1,211,084)
(1,730,138)

Provisions for liabilities
  

Deferred taxation
 22 
(2,339)
(19,330)

Net assets
  
 
 
4,317,082
 
 
3,571,310


Capital and reserves
  

Called up share capital 
 23 
250
250

Other reserves
 24 
3,268,085
3,268,085

Profit and loss account
 24 
814,518
69,118

Equity attributable to owners of the parent Company
  
4,082,853
3,337,453

Non-controlling interests
  
234,229
233,857

  
4,317,082
3,571,310


The financial statements were approved and authorised for issue by the board and were signed on its behalf on 30 October 2023.


R A Brighton
Director

The notes on pages 17 to 34 form part of these financial statements.

Page 10

 
D.A. PAK HOLDINGS LIMITED
REGISTERED NUMBER: 13216065

COMPANY BALANCE SHEET
AS AT 31 MARCH 2023

2023
2022
Note
£
£

Fixed assets
  

Tangible assets
 14 
1,747,116
-

Investments
 15 
3,283,913
3,283,913

  
5,031,029
3,283,913

Current assets
  

Debtors: amounts falling due within one year
 17 
103,337
-

Cash at bank and in hand
 18 
17,901
3,650

  
121,238
3,650

Creditors: amounts falling due within one year
 19 
(2,309,778)
(1,361,690)

Net current liabilities
  
 
 
(2,188,540)
 
 
(1,358,040)

Total assets less current liabilities
  
2,842,489
1,925,873

  

Creditors: amounts falling due after more than one year
 20 
(1,211,084)
(1,730,138)

  

Net assets
  
1,631,405
195,735


Capital and reserves
  

Called up share capital 
 23 
250
250

Profit and loss account
  
1,631,155
195,485

  
1,631,405
195,735


The financial statements were approved and authorised for issue by the board and were signed on its behalf on 30 October 2023.


R A Brighton
Director

The notes on pages 17 to 34 form part of these financial statements.

Page 11

 
D.A. PAK HOLDINGS LIMITED
 

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2023


Called up share capital
Other reserves
Profit and loss account
Equity attributable to owners of parent Company
Non-controlling interests
Total equity

£
£
£
£
£
£


Comprehensive income for the period

Profit for the period
-
-
69,118
69,118
5,276
74,394
Total comprehensive income for the period
-
-
69,118
69,118
5,276
74,394

Shares issued during the period
250
-
-
250
-
250

Non-controlling interest on acquisition
-
-
-
-
228,581
228,581

Share transfer
-
3,268,085
-
3,268,085
-
3,268,085


Total transactions with owners
250
3,268,085
-
3,268,335
228,581
3,496,916



At 1 April 2022
250
3,268,085
69,118
3,337,453
233,857
3,571,310


Comprehensive income for the year

Profit for the year
-
-
839,070
839,070
94,132
933,202
Total comprehensive income for the year
-
-
839,070
839,070
94,132
933,202

Dividends: Equity capital
-
-
(93,670)
(93,670)
(93,760)
(187,430)


Total transactions with owners
-
-
(93,670)
(93,670)
(93,760)
(187,430)


At 31 March 2023
250
3,268,085
814,518
4,082,853
234,229
4,317,082


The notes on pages 17 to 34 form part of these financial statements.

Page 12

 
D.A. PAK HOLDINGS LIMITED
 

COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2023


Called up share capital
Profit and loss account
Total equity

£
£
£


At 1 February 2021
-
-
-


Comprehensive income for the period

Profit for the period
-
195,485
195,485

Shares issued during the period
250
-
250



At 1 April 2022
250
195,485
195,735


Comprehensive income for the period

Profit for the year
-
1,529,340
1,529,340

Dividends: Equity capital
-
(93,670)
(93,670)


At 31 March 2023
250
1,631,155
1,631,405


The notes on pages 17 to 34 form part of these financial statements.

Page 13

 
D.A. PAK HOLDINGS LIMITED
 

CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2023

2023
2022
£
£

Cash flows from operating activities

Profit for the financial year
933,202
74,394

Adjustments for:

Amortisation of intangible assets
252,261
20,580

Depreciation of tangible assets
60,966
58,753

Loss on disposal of tangible assets
(643,661)
-

Interest paid
115,305
1,461

Interest received
(70)
(2)

Taxation charge
304,906
25,160

Decrease in stocks
344,370
-

Decrease in debtors
741,269
598,095

(Decrease)/increase in creditors
(1,825,173)
983,861

Corporation tax (paid)/received
(477,595)
293,237

Net cash generated from operating activities

(194,220)
2,055,539


Cash flows from investing activities

Purchase of tangible fixed assets
(132,819)
(58,753)

Sale of tangible fixed assets
686,447
-

Purchase of fixed asset investments
-
(6,374,858)

Interest received
70
2

Net cash from investing activities

553,698
(6,433,609)
Page 14

 
D.A. PAK HOLDINGS LIMITED
 

CONSOLIDATED STATEMENT OF CASH FLOWS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023


2023
2022

£
£



Cash flows from financing activities

Issue of ordinary shares
-
250

Share for share exchange
-
3,268,085

New secured loans
-
1,291,985

Repayment of loans
(64,722)
-

Dividends paid
(93,670)
-

Interest paid
(115,305)
(1,461)

Dividends paid to non-controlling interests
(93,760)
-

Net cash used in financing activities
(367,457)
4,558,859

Net (decrease)/increase in cash and cash equivalents
(7,979)
180,789

Cash and cash equivalents at beginning of year
180,789
-

Cash and cash equivalents at the end of year
172,810
180,789


Cash and cash equivalents at the end of year comprise:

Cash at bank and in hand
172,810
180,789

172,810
180,789


The notes on pages 17 to 34 form part of these financial statements.

Page 15

 
D.A. PAK HOLDINGS LIMITED
 

CONSOLIDATED ANALYSIS OF NET DEBT
FOR THE YEAR ENDED 31 MARCH 2023




At 1 April 2022
Cash flows
At 31 March 2023
£

£

£

Cash at bank and in hand

180,789

(7,979)

172,810

Debt due after 1 year

(1,230,138)

19,054

(1,211,084)

Debt due within 1 year

(88,232)

41,296

(46,936)


(1,137,581)
52,371
(1,085,210)

The notes on pages 17 to 34 form part of these financial statements.

Page 16

 
D.A. PAK HOLDINGS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

1.


General information

D.A. Pak Holdings Limited is a private company limited by shares, incorporated in England and Wales (registered number: 13216065). Its registered office is Mort House, Crowcrofts Road, Newstead Industrial Estate, Trentham, Stoke-On-Trent, Staffordshire, ST4 8HX. The principal activity of the company throughout the year continued to be that of a holding company.

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 companys functional and presentation currency is pounds sterling.

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 Balance Sheet, 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.
D A Pak Limited was acquired by the group on 25th February 2022, and as such the comparative balances included in the Consolidated Statement of Comprehensive Income include only trading results for D A Pak Limited from March 2022.

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 Balance Sheet, 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

 
D.A. PAK HOLDINGS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

2.Accounting policies (continued)


2.2
Basis of consolidation (continued)

In accordance with the transitional exemption available in FRS 102, the group has chosen not to retrospectively apply the standard to business combinations that occurred before the date of transition to FRS 102, being 22 February 2021.

 
2.3

Revenue

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the revenue can be reliably measured. Revenue 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 revenue is recognised:

Sale of goods

Revenue 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 revenue 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.

 
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.

 
2.5

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.

 
2.6

Pensions

Defined contribution pension plan

The Group operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Group pays fixed contributions into a separate entity. Once the contributions have been paid the Group has no further payment obligations.

The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Balance Sheet. The assets of the plan are held separately from the Group in independently administered funds.

Page 18

 
D.A. PAK HOLDINGS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

2.Accounting policies (continued)

 
2.7

Current and deferred taxation

Tax is recognised in the Income statement, except that a change 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 balance sheet date in the countries where the Company operates and generates income.
Deferred balances are recognised in respect of all material timing differences that have originated but not reversed by the Balance Sheet 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; and any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.

 
2.8

Intangible assets

Goodwill

Goodwill represents the difference between amounts paid on the cost of a business combination and the acquirer’s interest in the fair value of the Group's share of its identifiable assets and liabilities of the acquiree at the date of acquisition. Subsequent to initial recognition, goodwill is measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is amortised on a straight-line basis to the Consolidated Statement of Comprehensive Income over its useful economic life.

Other intangible assets

Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.

All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.

 
2.9

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.

Page 19

 
D.A. PAK HOLDINGS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

2.Accounting policies (continued)


2.9
Tangible fixed assets (continued)

Land is not depreciated. Depreciation on other assets is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, as follows.

Depreciation is provided on the following basis:

Freehold property
-
2%
straight line
Plant and machinery
-
15%
reducing balance
Motor vehicles
-
25%
reducing balance
Fixtures and fittings
-
15%
reducing balance

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.

 
2.10

Valuation of investments

Investments in subsidiaries are measured at cost less accumulated impairment.

Investments in unlisted Group shares, whose market value can be reliably determined, are remeasured to market value at each balance sheet date. Gains and losses on remeasurement are recognised in the Consolidated Statement of Comprehensive Income for the period. Where market value cannot be reliably determined, such investments are stated at historic cost less impairment.

Investments in listed company shares are remeasured to market value at each balance sheet date. Gains and losses on remeasurement are recognised in profit or loss for the period.

 
2.11

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 first in, first out basis. Work in progress and finished goods include labour and attributable overheads.

At each balance sheet 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 profit or loss.

 
2.12

Debtors

Short-term debtors are measured at transaction price, less any impairment.

Page 20

 
D.A. PAK HOLDINGS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

2.Accounting policies (continued)

 
2.13

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.

In the Consolidated Statement of Cash Flows, cash and cash equivalents are shown net of bank overdrafts that are repayable on demand and form an integral part of the Group's cash management.

 
2.14

Creditors

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

 
2.15

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 balance sheet 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 Balance Sheet.

 
2.16

Financial instruments

The group only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities such as bank and cash balances, trade and other accounts receivable and payable, loans from banks and other third parties and loans to and from related parties.
Debt instruments (other than those wholly repayable or receivable within one year), including loans and other accounts receivable and payable, are initially measured at the transaction price and subsequently at amortised cost using the effective interest method. Debt instruments that are payable or receivable within one year, typically trade payables or receivables, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received. However, if the arrangements of a short-term instrument constitute a financing transaction, the financial asset or liability is measured, initially, at the present value of the future cash flow discounted at a market rate of interest for a similar debt instrument and subsequently at amortised cost.
Financial assets and liabilities are offset and the net amount reported in the Balance Sheet when there is an 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 21

 
D.A. PAK HOLDINGS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

2.Accounting policies (continued)

 
2.17

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.


3.


Judgments in applying accounting policies and key sources of estimation uncertainty

No significant judgements have had to be made by management in preparing these financial statements. The Group makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have the greatest level of uncertainty are addressed below:
(i) Stock provisioning
When calculating the stock provision, management considers the nature and condition of the inventory, as well as applying assumptions around anticipated saleability of stock. The carrying value of stock after making such a provision was £3,699,661 (2022: £4,044,031).
ii) Impairment of debtors
The Group makes an estimate of the recoverable value of trade and other debtors. When assessing impairment of trade and other debtors, management considers factors including the current credit rating of the debtor, the ageing profile of debtors and historical experience. The amount of trade and other debtors after making such provision was £2,353,982 (2022: £3,095,337).


4.


Turnover

2023
2022
£
£

Turnover
14,127,028
1,158,241


All turnover arose within the United Kingdom.


5.


Operating profit

The operating profit is stated after charging:

2023
2022
£
£

Depreciation of tangible fixed assets
60,966
58,753

Profit on disposal of tangible fixed assets
(643,661)
(5,000)

Other operating lease rentals
48,980
51,809

Operating lease rentals
5,286
7,055

Defined contribution pension costs
53,278
58,753

Page 22

 
D.A. PAK HOLDINGS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

6.


Auditors' remuneration

During the year, the Group obtained the following services from the Company's auditors:


2023
2022
£
£

Fees payable to the Company's auditors for the audit of the consolidated and parent Company's financial statements

14,370
-


7.


Employees

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


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


Wages and salaries
506,092
35,275
-
-

Social security costs
52,423
4,697
-
-

Cost of defined contribution scheme
160,315
10,368
-
-

718,830
50,340
-
-


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.









Directors
3
2
3
2



Employees
15
15
-
-

18
17
3
2


8.


Directors' remuneration




During the year retirement benefits were accruing to 1 director (2022 - 1) in respect of defined contribution pension schemes.

Page 23

 
D.A. PAK HOLDINGS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

9.


Interest receivable

2023
2022
£
£


Other interest receivable
70
2


10.


Interest payable and similar expenses

2023
2022
£
£


Bank interest payable
-
1,082

Mortgage interest payable
55,251
-

Other interest payable
60,053
379

115,304
1,461


11.


Taxation


2023
2022
£
£

Corporation tax


Current tax on profits for the year
321,897
26,533


Total current tax
321,897
26,533

Deferred tax


Origination and reversal of timing differences
(3,695)
(160)

Movement in provisions
(13,296)
(1,213)

Total deferred tax
(16,991)
(1,373)


Taxation on profit
304,906
25,160
Page 24

 
D.A. PAK HOLDINGS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
 
11.Taxation (continued)


Factors affecting tax charge for the year/period

The tax assessed for the year/period is higher than (2022 - higher than) the standard rate of corporation tax in the UK of19% (2022 -19%). The differences are explained below:

2023
2022
£
£


Profit before tax
1,238,107
99,554


Profit multiplied by standard rate of corporation tax in the UK of 19% (2022 - 19%)
235,240
18,915

Effects of:


Expenses not deductible for tax purposes, other than goodwill amortisation and impairment
62,754
6,194

Capital allowances for year/period in excess of depreciation
(107,921)
(182)

Other tax charge (relief) on exceptional items
117,600
-

Remeasurement of deferred tax for changes in tax rates
(4,492)
421

Other tax adjustments, reliefs and transfers
-
(44)

Movement in deferred tax not recognised
1,725
(144)

Total tax charge for the year/period
304,906
25,160






12.


Dividends

2023
2022
£
£


Ordinary B shares
46,835
-


Ordinary C shares
46,835
-

93,670
-

Page 25

 
D.A. PAK HOLDINGS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

13.


Intangible assets

Group and Company





Goodwill

£



Cost


At 1 April 2022
2,469,658



At 31 March 2023

2,469,658



Amortisation


At 1 April 2022
20,580


Charge for the year on owned assets
252,261



At 31 March 2023

272,841



Net book value



At 31 March 2023
2,196,817



At 31 March 2022
2,449,078



No intangible assets are held in the parent company. 

Page 26

 
D.A. PAK HOLDINGS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

14.


Tangible fixed assets

Group






Freehold property
Plant and machinery
Motor vehicles
Fixtures and fittings
Total

£
£
£
£
£



Cost


At 1 April 2022
1,810,694
45,214
263,511
265,415
2,384,834


Additions
4,804
-
124,661
3,354
132,819


Disposals
-
-
(110,996)
-
(110,996)



At 31 March 2023

1,815,498
45,214
277,176
268,769
2,406,657



Depreciation


At 1 April 2022
56,882
32,029
155,248
152,454
396,613


Charge for the year on owned assets
11,500
1,978
30,294
17,194
60,966


Disposals
-
-
(68,210)
-
(68,210)



At 31 March 2023

68,382
34,007
117,332
169,648
389,369



Net book value



At 31 March 2023
1,747,116
11,207
159,844
99,121
2,017,288



At 31 March 2022
1,753,812
13,185
108,263
112,961
1,988,221

Page 27

 
D.A. PAK HOLDINGS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

           14.Tangible fixed assets (continued)


Company






Freehold property

£

Cost


Additions
1,754,804



At 31 March 2023

1,754,804



Depreciation


Charge for the year on owned assets
7,688



At 31 March 2023

7,688



Net book value



At 31 March 2023
1,747,116



At 31 March 2022
-






Page 28

 
D.A. PAK HOLDINGS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

15.


Fixed asset investments

Company





Investments in subsidiary companies

£



Cost


At 1 April 2022
3,283,913



At 31 March 2023
3,283,913





Subsidiary undertaking


The following was a subsidiary undertaking of the Company:

Name

Class of shares

Holding

D A Pak Limited
Ordinary
95%

The aggregate of the share capital and reserves as at 31 March 2023 and the profit or loss for the year ended on that date for the subsidiary undertaking were as follows:

Name
Aggregate of share capital and reserves
Profit/(Loss)

D A Pak Limited
3,772,774
1,775,069


16.


Stocks

Group
Group
2023
2022
£
£

Finished goods and goods for resale
3,699,661
4,044,031


Page 29

 
D.A. PAK HOLDINGS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

17.


Debtors

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


Trade debtors
2,353,982
3,095,336
-
-

Amounts owed by group undertakings
1
-
-
-

Prepayments and accrued income
5,033
4,945
103,337
-

2,359,016
3,100,281
103,337
-



18.


Cash and cash equivalents

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

Cash at bank and in hand
172,810
180,789
17,901
3,650



19.


Creditors: Amounts falling due within one year

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

Bank loans
16,179
61,847
16,179
61,847

Trade creditors
2,418,083
3,412,181
-
-

Amounts owed to group undertakings
-
-
1,752,372
598,093

Corporation tax
162,699
318,397
8,686
-

Other taxation and social security
206,948
138,126
-
-

Other creditors
2,107,057
2,509,321
528,420
700,000

Accruals and deferred income
4,121
1,750
4,121
1,750

4,915,087
6,441,622
2,309,778
1,361,690


Page 30

 
D.A. PAK HOLDINGS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

20.


Creditors: Amounts falling due after more than one year

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

Bank loans
1,211,084
1,230,138
1,211,084
1,230,138

Other creditors
-
500,000
-
500,000

1,211,084
1,730,138
1,211,084
1,730,138


Included in creditors due withn and after more than one year is a bank loan of £1,227,263 (2022 £1,291,985) on which security has been given by the company.

Included in creditors due after more than one year is a bank loan on which £1,143,610 (2022 £962,780) is due after more than 5 years. 


21.


Loans




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

Amounts falling due within one year

Bank loans
16,179
61,847
16,179
61,847

Amounts falling due 1-2 years

Bank loans
15,002
63,281
15,002
63,281

Amounts falling due 2-5 years

Bank loans
51,472
204,077
51,472
204,077

Amounts falling due after more than 5 years

Bank loans
1,144,610
962,780
1,144,610
962,780

1,227,263
1,291,985
1,227,263
1,291,985


The loan is repayable in 180 monthly instalments from February 2022 at an interest rate of 2.35% above base.

Page 31

 
D.A. PAK HOLDINGS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

22.


Deferred taxation


Group



2023


£






At beginning of year
19,330


Charged to profit or loss
(16,991)



At end of year
2,339

Group
Group
2023
2022
£
£

Accelerated capital allowances
30,195
33,890

Movement in provisions
(27,856)
(14,560)

2,339
19,330


23.


Share capital

2023
2022
£
£
Allotted, called up and fully paid



125 (2022 - 125) Ordinary B shares shares of £1.00 each
125
125
125 (2022 - 125) Ordinary C shares shares of £1.00 each
125
125

250

250



24.


Reserves

Other reserves

Other reserves represent the fair value of shares recognised on acquisition from a share for share exchange. 

Profit and loss account

Profit and loss account represents all current and prior period profits and losses and is all considered to be distributable.

Page 32

 
D.A. PAK HOLDINGS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

25.
 

Business combinations

On 25th February 2022 the Company entered into an agreement to purchase 95% of the share capital of DA Pak Limited from the shareholders, for a total consideration of £6,551,998.

Acquisition of D A Pak Limited

Recognised amounts of identifiable assets acquired and liabilities assumed

Book value
Fair value adjustments
Fair value
£
£
£

Fixed Assets

Tangible
1,369,274
618,947
1,988,221

1,369,274
618,947
1,988,221

Current Assets

Stocks
4,044,031
-
4,044,031

Debtors
3,698,376
-
3,698,376

Cash at bank and in hand
177,140
-
177,140

Total Assets
9,288,821
618,947
9,907,768

Creditors

Due within one year
(5,577,517)
-
(5,577,517)

Deferred taxation
(19,330)
-
(19,330)

Total Identifiable net assets
3,691,974
618,947
4,310,921


Non-controlling interests
(228,581)

Goodwill
2,469,658

Total purchase consideration
6,551,998

Consideration

£


Cash
3,200,000

Equity instruments
3,268,085

Directly attributable costs
83,913

Total purchase consideration
6,551,998

Page 33

 
D.A. PAK HOLDINGS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

25.Business combinations (continued)


£


Purchase consideration settled in cash, as above
3,200,000

Equity instruments
3,268,085

Directly attributable costs
83,913

6,551,998

Less: Cash and cash equivalents acquired
(177,140)

Net cash outflow on acquisition
6,374,858


26.


Pension commitments

The Group operates a defined contributions 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 amounted to £160,315 (2022: £124,409). Contributions totalling £2,337 (2022: £2,636) were payable to the fund at the balance sheet date and are included in creditors.


27.


Commitments under operating leases

At 31 March 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
2023
2022
£
£

Not later than 1 year
184,460
41,293

Later than 1 year and not later than 5 years
627,347
36,404

Later than 5 years
206,667
-

1,018,474
77,697
Page 34