Company Registration No. NI029570 (Northern Ireland)
N.K. HOLDINGS LIMITED
GROUP ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023
N.K. HOLDINGS LIMITED
COMPANY INFORMATION
Directors
Mr A Davidson
Mr P Davidson
Secretary
Mr S Ferguson
Company number
NI029570
Registered office
40 Trailcock Road
Carrickfergus
Co Antrim
BT38 7NU
Auditor
GMcG BELFAST
Chartered Accountants & Statutory Auditor
Alfred House
19 Alfred Street
Belfast
BT2 8EQ
Bankers
Danske Bank
21-23 High Street
Carrickfergus
Co Antrim
BT38 7AL
Solicitors
Millar McCall Wylie
Eastleigh House
396 Upper Newtownards Road
Belfast
BT4 3EY
N.K. HOLDINGS LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2 - 3
Independent auditor's report
4 - 9
Group statement of comprehensive income
10
Group balance sheet
11
Company balance sheet
12
Group statement of changes in equity
13
Company statement of changes in equity
14
Group statement of cash flows
15
Company statement of cash flows
16
Notes to the financial statements
17 - 37
N.K. HOLDINGS LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 30 APRIL 2023
- 1 -

The directors present the strategic report for the year ended 30 April 2023.

Business review

The principal activities of the group during the year were the manufacture and erection of security fencing, galvanising steel products and providing anti-corrosive treatments. The group also holds investment properties for rental return.

 

The directors aim to present a balanced and comprehensive review of the development and performance of the group during the year and its position as at 30 April 2023. This review is consistent with the size and nature of the business and is written in the context of the risks and uncertainties it faces.

 

As for many businesses of its size, the business environment in which the group operates remains challenging, the fencing market in Ireland and the United Kingdom is highly competitive.

 

The directors continue to identify opportunities to increase turnover, and continue to monitor and reduce costs where possible. The directors anticipate higher volumes of trade into 2024, and are hopeful of maintaining market share.

 

The directors are pleased with the group results for the year given the challenging market conditions.

Principal risks and uncertainties

The key risks and uncertainties affecting the group are considered to relate to competition from other businesses, employee retention, product availability and the general downturn in customer spending due to the current economic climate.

 

In these circumstances, the directors work closely with suppliers, customers, staff and financial institutions to carefully manage the business.

Financial key performance indicators

The directors consider that the key performance indicators are those that communicate the financial performance and strength of the group as a whole, these being turnover, gross margin, operating profit and net assets.

 

There has been an increase in turnover of 14.4% in the year from £16.93m to £19.36m and the gross profit margin has increased from 31.43% to 35.82%.

 

The group had an operating profit for the year of £2,341k compared to an operating profit of £1,298k in 2022.

 

The net assets have increased from £10.48m in 2022 to £11.51m in 2023; this after a dividend payment of £740k during the year.

On behalf of the board

Mr A Davidson
Director
17 October 2023
N.K. HOLDINGS LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 APRIL 2023
- 2 -

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

Directors

The directors who held office during the year and up to the date of signature of the financial statements were as follows:

Mr A Davidson
Mr P Davidson
Results and dividends

The results for the year are set out on page 10.

Ordinary dividends were paid amounting to £740,000. The directors do not recommend payment of a further dividend.

Auditor

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

Statement of directors' responsibilities

The directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulations.

 

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the group and company, and of the profit or loss of the group for that period. In preparing these financial statements, the directors are required to:

 

 

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the group’s and company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the group and company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

N.K. HOLDINGS LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2023
- 3 -
Statement of disclosure to auditor

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the auditor of the company is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the auditor of the company is aware of that information.

On behalf of the board
Mr A Davidson
Director
17 October 2023
N.K. HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF N.K. HOLDINGS LIMITED
- 4 -
Opinion

We have audited the financial statements of N.K. Holdings Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 30 April 2023 which comprise the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows, the company statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the group and parent company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

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

 

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the group's and 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.

N.K. HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF N.K. HOLDINGS LIMITED
- 5 -

Other information

The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

 

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of our audit:

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 their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.

 

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

N.K. HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF N.K. HOLDINGS LIMITED
- 6 -
Responsibilities of directors

As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the 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 parent company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

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

The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

N.K. HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF N.K. HOLDINGS LIMITED
- 7 -
Extent to which the audit was considered capable of detecting irregularities, including fraud

We identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and then design and perform audit procedures responsive to those risks, including obtaining audit evidence that is sufficient and appropriate to provide a basis for our opinion.

In identifying and assessing potential risks of material misstatement in respect of irregularities, including fraud and non-compliances with laws and regulations, we considered the following:

As a result of these procedures, we considered the opportunities and incentives that may exist within the group and company for fraud and identified the greatest potential for fraud in revenue recognition. In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override.

We also obtained an understanding of the legal and regulatory frameworks that the group and company operates in, focusing on provisions of those laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements. The key laws and regulations we considered in this context included the Companies Act 2006, and local tax legislation.

In addition, we considered provisions of other laws and regulations that do not have a direct effect on the financial statements but compliance with which may be fundamental to the group and company’s ability to operate or to avoid a material penalty.

N.K. HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF N.K. HOLDINGS LIMITED
- 8 -
Audit response to risks identified

Our procedures to respond to the risks identified included the following:

We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members and remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit.

Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. In addition, as with any audit, there remains a higher risk of non-detection of irregularities, as they may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls. We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

N.K. HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF N.K. HOLDINGS LIMITED
- 9 -

Use of our report

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

Mrs Susan Dunlop FCA (Senior Statutory Auditor)
For and on behalf of GMcG BELFAST
17 October 2023
Chartered Accountants
Statutory Auditor
Chartered Accountants & Statutory Auditor
Alfred House
19 Alfred Street
Belfast
BT2 8EQ
N.K. HOLDINGS LIMITED
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 APRIL 2023
- 10 -
2023
2022
Notes
£
£
Turnover
3
19,361,612
16,927,067
Cost of sales
(12,426,789)
(11,606,974)
Gross profit
6,934,823
5,320,093
Distribution costs
(466,480)
(381,629)
Administrative expenses
(4,096,526)
(3,791,168)
Other operating (expenses)/income
(33,043)
150,911
Operating profit
4
2,338,774
1,298,207
Interest receivable and similar income
8
2,340
116
Interest payable and similar expenses
9
(155,622)
(122,058)
Profit before taxation
2,185,492
1,176,265
Tax on profit
10
(412,363)
(218,451)
Profit for the financial year
25
1,773,129
957,814
Other comprehensive income
Currency translation (loss)/gain taken to retained earnings
(420)
341
Total comprehensive income for the year
1,772,709
958,155
Profit for the financial year is all attributable to the owners of the parent company.
Total comprehensive income for the year is all attributable to the owners of the parent company.
N.K. HOLDINGS LIMITED
GROUP BALANCE SHEET
AS AT
30 APRIL 2023
30 April 2023
- 11 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
12
6,246,263
6,162,231
Investment property
13
2,694,940
1,653,253
8,941,203
7,815,484
Current assets
Stocks
16
2,237,444
2,287,257
Debtors
17
5,394,348
4,856,585
Cash at bank and in hand
2,171,165
2,370,828
9,802,957
9,514,670
Creditors: amounts falling due within one year
18
(4,746,582)
(4,899,124)
Net current assets
5,056,375
4,615,546
Total assets less current liabilities
13,997,578
12,431,030
Creditors: amounts falling due after more than one year
19
(1,880,564)
(1,464,888)
Provisions for liabilities
Deferred tax liability
22
605,796
487,633
(605,796)
(487,633)
Net assets
11,511,218
10,478,509
Capital and reserves
Called up share capital
24
50,667
50,667
Revaluation reserve
25
1,603,223
1,618,757
Capital redemption reserve
25
49,333
49,333
Profit and loss reserves
25
9,807,995
8,759,752
Total equity
11,511,218
10,478,509
The financial statements were approved by the board of directors and authorised for issue on 17 October 2023 and are signed on its behalf by:
17 October 2023
Mr A Davidson
Mr P Davidson
Director
Director
Company registration number NI029570 (Northern Ireland)
N.K. HOLDINGS LIMITED
COMPANY BALANCE SHEET
AS AT 30 APRIL 2023
30 April 2023
- 12 -
2023
2022
Notes
£
£
£
£
Fixed assets
Investment property
13
7,474,969
6,929,027
Investments
14
585,697
585,697
8,060,666
7,514,724
Current assets
Debtors
17
1,736,581
535,242
Cash at bank and in hand
391,989
652,096
2,128,570
1,187,338
Creditors: amounts falling due within one year
18
(588,497)
(366,179)
Net current assets
1,540,073
821,159
Total assets less current liabilities
9,600,739
8,335,883
Creditors: amounts falling due after more than one year
19
(277,497)
-
Provisions for liabilities
Deferred tax liability
22
89,953
89,837
(89,953)
(89,837)
Net assets
9,233,289
8,246,046
Capital and reserves
Called up share capital
24
50,667
50,667
Capital redemption reserve
25
7,000
7,000
Profit and loss reserves
25
9,175,622
8,188,379
Total equity
9,233,289
8,246,046

As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £1,727,243 (2022 - £962,739 profit).

The financial statements were approved by the board of directors and authorised for issue on 17 October 2023 and are signed on its behalf by:
17 October 2023
Mr A Davidson
Mr P Davidson
Director
Director
Company registration number NI029570 (Northern Ireland)
N.K. HOLDINGS LIMITED
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 APRIL 2023
- 13 -
Share capital
Revaluation reserve
Capital redemption reserve
Profit and loss reserves
Total
Notes
£
£
£
£
£
Balance at 1 May 2021
50,667
1,634,291
49,333
8,426,063
10,160,354
Year ended 30 April 2022:
Profit for the year
-
-
-
957,814
957,814
Other comprehensive income:
Currency translation differences
-
-
-
341
341
Total comprehensive income
-
-
-
958,155
958,155
Dividends
11
-
-
-
(640,000)
(640,000)
Transfers
-
(15,534)
-
15,534
-
Balance at 30 April 2022
50,667
1,618,757
49,333
8,759,752
10,478,509
Year ended 30 April 2023:
Profit for the year
-
-
-
1,773,129
1,773,129
Other comprehensive income:
Currency translation differences
-
-
-
(420)
(420)
Total comprehensive income
-
-
-
1,772,709
1,772,709
Dividends
11
-
-
-
(740,000)
(740,000)
Transfers
-
(15,534)
-
15,534
-
Balance at 30 April 2023
50,667
1,603,223
49,333
9,807,995
11,511,218
N.K. HOLDINGS LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 APRIL 2023
- 14 -
Share capital
Capital redemption reserve
Profit and loss reserves
Total
Notes
£
£
£
£
Balance at 1 May 2021
50,667
7,000
7,865,640
7,923,307
Year ended 30 April 2022:
Profit and total comprehensive income for the year
-
-
962,739
962,739
Dividends
11
-
-
(640,000)
(640,000)
Balance at 30 April 2022
50,667
7,000
8,188,379
8,246,046
Year ended 30 April 2023:
Profit and total comprehensive income
-
-
1,727,243
1,727,243
Dividends
11
-
-
(740,000)
(740,000)
Balance at 30 April 2023
50,667
7,000
9,175,622
9,233,289
N.K. HOLDINGS LIMITED
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 APRIL 2023
- 15 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
30
2,732,252
1,480,267
Interest paid
(158,244)
(122,328)
Income taxes paid
(339,258)
(44,753)
Net cash inflow from operating activities
2,234,750
1,313,186
Investing activities
Purchase of tangible fixed assets
(733,144)
(594,607)
Proceeds from disposal of tangible fixed assets
918,926
-
Purchase of investment property
(1,107,266)
(339,415)
Proceeds from disposal of investment property
1
-
Loans made
(500,000)
-
Interest received
2,340
116
Net cash used in investing activities
(1,419,143)
(933,906)
Financing activities
Proceeds from new bank loans
475,000
200,000
Repayment of bank loans
(215,895)
(213,381)
Payment of finance leases obligations
(534,375)
(276,747)
Dividends paid to equity shareholders
(740,000)
(640,000)
Net cash used in financing activities
(1,015,270)
(930,128)
Net decrease in cash and cash equivalents
(199,663)
(550,848)
Cash and cash equivalents at beginning of year
2,370,828
2,921,676
Cash and cash equivalents at end of year
2,171,165
2,370,828
N.K. HOLDINGS LIMITED
COMPANY STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 APRIL 2023
- 16 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash (absorbed by)/generated from operations
31
(200,979)
270,912
Interest paid
(5,330)
(1,314)
Income taxes paid
(97,228)
(35,205)
Net cash (outflow)/inflow from operating activities
(303,537)
234,393
Investing activities
Purchase of investment property
(1,107,266)
(339,415)
Proceeds from disposal of investment property
858,664
-
0
Loans made
(500,000)
-
0
Interest received
1,191
69
Dividends received
1,225,000
400,000
Net cash generated from investing activities
477,589
60,654
Financing activities
Proceeds from new bank loans
325,000
-
Repayment of bank loans
(19,159)
(32,353)
Dividends paid to equity shareholders
(740,000)
(640,000)
Net cash used in financing activities
(434,159)
(672,353)
Net decrease in cash and cash equivalents
(260,107)
(377,306)
Cash and cash equivalents at beginning of year
652,096
1,029,402
Cash and cash equivalents at end of year
391,989
652,096
N.K. HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023
- 17 -
1
Accounting policies
Company information

N.K. Holdings Limited (“the company”) is a private limited company domiciled and incorporated in Northern Ireland. The registered office is 40 Trailcock Road, Carrickfergus, Co Antrim, BT38 7NU.

 

The group consists of N.K. Holdings Limited and all of its subsidiaries.

1.1
Accounting convention

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

The financial statements are prepared in sterling. Monetary amounts in these financial statements are rounded to the nearest £. The company operates with two functional currencies, sterling and euro.

The financial statements have been prepared under the historical cost convention, modified to include investment properties and certain financial instruments at fair value. The principal accounting policies adopted are set out below.

1.2
Basis of consolidation

In the parent company financial statements, the cost of a business combination is the fair value at the acquisition date of the assets given, equity instruments issued and liabilities incurred or assumed, plus costs directly attributable to the business combination. The excess of the cost of a business combination over the fair value of the identifiable assets, liabilities and contingent liabilities acquired is recognised as goodwill. The cost of the combination includes the estimated amount of contingent consideration that is probable and can be measured reliably, and is adjusted for changes in contingent consideration after the acquisition date. Provisional fair values recognised for business combinations in previous periods are adjusted retrospectively for final fair values determined in the 12 months following the acquisition date. Investments in subsidiaries, joint ventures and associates are accounted for at cost less impairment.

 

Deferred tax is recognised on differences between the value of assets (other than goodwill) and liabilities recognised in a business combination accounted for using the purchase method and the amounts that can be deducted or assessed for tax, considering the manner in which the carrying amount of the asset or liability is expected to be recovered or settled. The deferred tax recognised is adjusted against goodwill or negative goodwill.

The consolidated group financial statements consist of the financial statements of the parent company N.K. Holdings Limited together with all entities controlled by the parent company (its subsidiaries) and the group’s share of its interests in joint ventures and associates.

 

All financial statements are made up to 30 April 2023. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.

 

All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.

1.3
Going concern

At the time of approving the financial statements, the directors have a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

N.K. HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2023
1
Accounting policies (Continued)
- 18 -
1.4
Turnover

Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.

 

When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income.

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

Revenue from contracts for the provision of professional services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that it is probable will be recovered.

Rental income is recognised evenly over the period of the tenancy agreement.

1.5
Tangible fixed assets

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

 

On transition to FRS 102 the group elected to use the revaluation of certain premises at 30 April 2014 as the deemed cost for that asset and continues to adopt a policy of non-revaluation from that date as permitted under Section 35 of FRS 102. The property is depreciated over its useful economic life from that date.

 

The difference between depreciation based on the deemed cost charged in the profit and loss account and the asset’s original cost is transferred from the revaluation reserve to retained earnings through equity.

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

Freehold land and buildings
5% per annum straight line
Leasehold improvements
10% per annum straight line
Plant and equipment
10-25% per annum straight line
Fixtures and fittings
15-20% per annum straight line
Motor vehicles
25% per annum straight line

Freehold land is not depreciated.

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in the profit and loss account.

N.K. HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2023
1
Accounting policies (Continued)
- 19 -
1.6
Investment properties

Investment property, which is property held to earn rentals and/or for capital appreciation, is initially recognised at cost, which includes the purchase cost and any directly attributable expenditure. Subsequently it is measured at fair value at the reporting end date. The surplus or deficit on revaluation is recognised in profit or loss.

 

Where fair value cannot be achieved without undue cost or effort, investment property is accounted for as

tangible fixed assets.

1.7
Fixed asset investments

Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available.

 

In the parent company financial statements, investments in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.

A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

1.8
Impairment of fixed assets

At each reporting period end date, the group reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

 

The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

 

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

N.K. HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2023
1
Accounting policies (Continued)
- 20 -
1.9
Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.

 

Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

1.10
Cash at bank and in hand

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

1.11
Financial instruments

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

 

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

 

Financial assets and liabilities are offset and 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.

Basic financial assets

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

Other financial assets

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

N.K. HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2023
1
Accounting policies (Continued)
- 21 -
Impairment of financial assets

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

 

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

 

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

Derecognition of financial assets

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

Classification of financial liabilities

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

Basic financial liabilities

Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

 

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

 

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

Other financial liabilities

Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.

 

Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

N.K. HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2023
1
Accounting policies (Continued)
- 22 -
Derecognition of financial liabilities

Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.

1.12
Equity instruments

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

1.13
Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

Current tax

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax

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

 

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

1.14
Employee benefits

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

 

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

 

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

1.15
Retirement benefits

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

N.K. HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2023
1
Accounting policies (Continued)
- 23 -
1.16
Leases

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.

 

Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.

Rental income from operating leases is recognised on a straight line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight line basis over the lease term.

1.17
Government grants

Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.

 

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

1.18
Foreign exchange

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.

2
Judgements and key sources of estimation uncertainty

In the application of the group’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

 

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

N.K. HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2023
2
Judgements and key sources of estimation uncertainty (Continued)
- 24 -
Key sources of estimation uncertainty

The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.

Fixed assets

The annual depreciation charge on fixed assets depends primarily on the estimated lives of each type of asset and estimates of residual values. The directors regularly review these asset lives and change them as necessary to reflect current thinking on remaining lives in light of prospective economic utilisation and physical condition of the assets concerned. Changes in asset lives can have a significant impact on depreciation and amortisation charges for the period. Detail of the useful lives is included in the accounting policies.

Investment property

Fair value is determined annually and derived from the current market rents and investment property yields for comparable real estate. Valuation involves some estimation uncertainty but is based on periodic advice from independent expert valuers.

Stocks

At each balance sheet date the group's 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 assessment of the selling price of such stock involves some estimation uncertainty.

Debtors

Short term debtors are measured at transaction price, less any impairment. Impairment of such debtors involves some estimation uncertainty.

Taxation

Judgements are made in relation to the calculation of certain aspects of the year end tax provisions and the respective tax charge. The management used external professional advice to support the year end provisions.

3
Turnover and other revenue
2023
2022
£
£
Turnover analysed by class of business
Fencing, galvanising and anti-corrosive treatments
19,257,264
16,840,030
Rental income from investment properties
104,348
87,037
19,361,612
16,927,067
2023
2022
£
£
Turnover analysed by geographical market
United Kingdom
16,018,922
13,942,119
Republic of Ireland
3,342,690
2,984,948
19,361,612
16,927,067
N.K. HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2023
3
Turnover and other revenue (Continued)
- 25 -
2023
2022
£
£
Other revenue
Interest income
2,340
116
Grants received
-
100,000
Sundry income
-
50,911
4
Operating profit
2023
2022
£
£
Operating profit for the year is stated after charging/(crediting):
Exchange gains
(146,492)
(10,335)
Government grants
-
(100,000)
Depreciation of owned tangible fixed assets
636,651
556,867
Depreciation of tangible fixed assets held under finance leases
283,954
251,369
Profit on disposal of tangible fixed assets
(387,808)
(185,560)
Loss on disposal of investment property
65,578
-
0
Operating lease charges
20,219
10,677
5
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the group and company
11,830
7,000
Audit of the financial statements of the company's subsidiaries
30,440
27,605
42,270
34,605
6
Employees

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

Group
Company
2023
2022
2023
2022
Number
Number
Number
Number
Number of production staff
113
115
-
-
Number of distribution staff
4
4
-
-
Number of administration staff
47
43
-
-
Number of directors
2
2
2
2
Total
166
164
2
2
N.K. HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2023
6
Employees (Continued)
- 26 -

Their aggregate remuneration comprised:

Group
Company
2023
2022
2023
2022
£
£
£
£
Wages and salaries
4,947,090
4,446,880
73,884
73,884
Social security costs
463,561
411,815
9,225
8,937
Pension costs
128,194
123,228
-
0
-
0
5,538,845
4,981,923
83,109
82,821
7
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
412,061
261,347
Company pension contributions to defined contribution schemes
-
10,000
412,061
271,347
Remuneration disclosed above includes the following amounts paid to the highest paid director:
2023
2022
£
£
Remuneration for qualifying services
334,126
232,924
Company pension contributions to defined contribution schemes
-
10,000

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

8
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
2,340
116
2023
2022
Investment income includes the following:
£
£
Interest on financial assets not measured at fair value through profit or loss
2,340
116
N.K. HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2023
- 27 -
9
Interest payable and similar expenses
2023
2022
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
102,266
84,511
Other finance costs:
Interest on finance leases and hire purchase contracts
53,356
37,547
Total finance costs
155,622
122,058
10
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
318,698
206,099
Adjustments in respect of prior periods
(24,488)
(69,309)
Double tax relief
(3,024)
(4,673)
Total UK current tax
291,186
132,117
Foreign current tax on profits for the current period
3,024
5,328
Total current tax
294,210
137,445
Deferred tax
Origination and reversal of timing differences
113,248
84,538
Adjustment in respect of prior periods
4,905
(3,532)
Total deferred tax
118,153
81,006
Total tax charge
412,363
218,451
N.K. HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2023
10
Taxation (Continued)
- 28 -

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

2023
2022
£
£
Profit before taxation
2,185,492
1,176,265
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00% (2022: 19.00%)
546,373
223,490
Tax effect of expenses that are not deductible in determining taxable profit
(53,903)
(64,623)
Unutilised tax losses carried forward
1,143
499
Adjustments in respect of prior years
(19,583)
(72,841)
Effect of change in corporation tax rate
(91,663)
117,035
Effect of change in rates/foreign taxes
7
656
Deferred tax asset movement
328
(12,171)
Adjustment on consolidation
29,661
47,765
Fair value movement
-
(21,359)
Taxation charge
412,363
218,451
11
Dividends
2023
2022
Recognised as distributions to equity holders:
£
£
Interim paid
740,000
640,000
N.K. HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2023
- 29 -
12
Tangible fixed assets
Group
Freehold land and buildings
Leasehold improvements
Plant and equipment
Fixtures and fittings
Motor vehicles
Total
£
£
£
£
£
£
Cost
At 1 May 2022
3,918,365
652,299
6,595,541
528,505
255,317
11,950,027
Additions
-
0
454,618
1,068,037
12,069
-
0
1,534,724
Disposals
(495,745)
-
0
(189,399)
-
0
(48,000)
(733,144)
Exchange adjustments
-
0
-
0
-
0
1,027
-
0
1,027
At 30 April 2023
3,422,620
1,106,917
7,474,179
541,601
207,317
12,752,634
Depreciation and impairment
At 1 May 2022
1,111,425
227,950
4,024,178
336,477
87,766
5,787,796
Depreciation charged in the year
136,973
79,154
592,097
59,710
52,671
920,605
Eliminated in respect of disposals
(15,637)
-
0
(180,420)
-
0
(7,000)
(203,057)
Exchange adjustments
-
0
-
0
-
0
1,027
-
0
1,027
At 30 April 2023
1,232,761
307,104
4,435,855
397,214
133,437
6,506,371
Carrying amount
At 30 April 2023
2,189,859
799,813
3,038,324
144,387
73,880
6,246,263
At 30 April 2022
2,806,940
424,349
2,571,363
192,028
167,551
6,162,231
The company had no tangible fixed assets at 30 April 2023 or 30 April 2022.

The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.

Group
Company
2023
2022
2023
2022
£
£
£
£
Plant and equipment
1,027,431
617,245
-
0
-
0
Motor vehicles
1,667
67,870
-
0
-
0
1,029,098
685,115
-
-

Included in land and buildings is freehold land at a cost of £1,027,367 (2022 - £1,139,782) which is not depreciated.

N.K. HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2023
- 30 -
13
Investment property
Group
Company
2023
2023
£
£
Fair value
At 1 May 2022
1,653,253
6,929,027
Additions through external acquisition
1,107,266
1,107,266
Disposals
(65,579)
(561,324)
At 30 April 2023
2,694,940
7,474,969

The 2023 valuations were made by the directors, taking into account external valuations carried out on an open market value for existing use basis.

If investment properties were stated on an historical cost basis rather than a fair value basis, the amounts would have been included as follows:
Group
Company
2023
2022
2023
2022
£
£
£
£
Cost
2,163,604
1,121,888
5,273,910
4,727,968
Accumulated depreciation
-
-
-
-
Carrying amount
2,163,604
1,121,888
5,273,910
4,727,968
14
Fixed asset investments
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Investments in subsidiaries
15
-
0
-
0
585,697
585,697
Movements in fixed asset investments
Company
Shares in subsidiaries
£
Cost or valuation
At 1 May 2022 and 30 April 2023
585,697
Carrying amount
At 30 April 2023
585,697
At 30 April 2022
585,697
N.K. HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2023
- 31 -
15
Subsidiaries

Details of the company's subsidiaries at 30 April 2023 are as follows:

Name of undertaking
Address
Nature of business
Class of
% Held
shares held
Direct
N.K. Fencing Limited
1
Manufacture and installation of fencing
Ordinary
100.00
N.K. Coatings Limited
2
Galvanising of steel products
Ordinary
100.00
Flexquote Limited
3
Holding of investment property for rental return
Ordinary
100.00
N K Plant &
Engineering Limited
1
Dormant
Ordinary
100.00
N.K. Fencing Limited
4
Manufacture and installation of fencing
Ordinary
100.00
N.K. Aluminium Coatings Limited
5
Coating of steel products
Ordinary
100.00

Registered office addresses (all UK unless otherwise indicated):

1
40 Trailcock Road, Carrickfergus, BT23 7NU, Northern Ireland
2
4 Michelin Road, Mallusk, BT36 4PT, Northern Ireland
3
Invision House, Wilbury Way, Hitchin, SG4 0TY, England
4
Backweston, Leixlip, Dublin, Republic of Ireland
5
12 Michelin Road, Mallusk, BT36 4PT, Northern Ireland
16
Stocks
Group
Company
2023
2022
2023
2022
£
£
£
£
Raw materials and consumables
1,580,986
1,641,103
-
-
Work in progress
171,242
164,460
-
-
Finished goods and goods for resale
485,216
481,694
-
0
-
0
2,237,444
2,287,257
-
-
17
Debtors
Group
Company
2023
2022
2023
2022
Amounts falling due within one year:
£
£
£
£
Trade debtors
3,913,070
3,716,017
-
0
-
0
Amounts owed by group undertakings
-
-
905,800
234,192
Other debtors
1,020,287
619,045
830,781
300,000
Prepayments and accrued income
460,991
521,523
-
0
1,050
5,394,348
4,856,585
1,736,581
535,242
N.K. HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2023
- 32 -
18
Creditors: amounts falling due within one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Bank loans
20
251,467
200,019
36,649
8,305
Obligations under finance leases
21
334,260
274,105
-
0
-
0
Trade creditors
2,296,795
2,848,972
71,055
3,286
Amounts owed to group undertakings
-
0
-
0
4,909
125
Corporation tax payable
169,927
214,985
79,269
94,275
Other taxation and social security
405,311
405,013
5,357
47,887
Other creditors
438,720
300,076
359,272
194,383
Accruals and deferred income
850,102
655,954
31,986
17,918
4,746,582
4,899,124
588,497
366,179
19
Creditors: amounts falling due after more than one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Bank loans
20
1,406,870
1,199,213
277,497
-
0
Obligations under finance leases
21
473,157
265,075
-
0
-
0
Government grants
537
600
-
0
-
0
1,880,564
1,464,888
277,497
-
Amounts included above which fall due after five years are as follows:
Payable by instalments
145,891
-
97,282
-
20
Loans and overdrafts
Group
Company
2023
2022
2023
2022
£
£
£
£
Bank loans
1,658,337
1,399,232
314,146
8,305
Payable within one year
251,467
200,019
36,649
8,305
Payable after one year
1,406,870
1,199,213
277,497
-
0

Bank loans are secured by a floating charge over the assets and undertakings of the group, a fixed charge over the book debts of the group and by legal mortgages over the group's premises.

Bank loans includes four loans repayable by monthly and quarterly instalments at interest rates of between 2.96% and 8.5%. £145,891 is repayable over 5 years.

N.K. HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2023
- 33 -
21
Finance lease obligations
Group
Company
2023
2022
2023
2022
£
£
£
£
Future minimum lease payments due under finance leases:
Within one year
334,261
274,105
-
0
-
0
In two to five years
231,556
265,075
-
0
-
0
In over five years
241,600
-
0
-
0
-
0
807,417
539,180
-
-

Obligations under finance leases are secured on the assets to which they relate.

22
Deferred taxation

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

Liabilities
Liabilities
2023
2022
Group
£
£
Accelerated capital allowances
526,748
430,854
Revaluations
85,562
85,562
Other timing differences
(6,514)
(28,783)
605,796
487,633
Liabilities
Liabilities
2023
2022
Company
£
£
Accelerated capital allowances
4,391
4,275
Revaluations
85,562
85,562
89,953
89,837
Group
Company
2023
2023
Movements in the year:
£
£
Liability at 1 May 2022
487,633
89,837
Charge to profit or loss
118,153
116
Foreign exchange difference
10
-
Liability at 30 April 2023
605,796
89,953
N.K. HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2023
- 34 -
23
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
128,194
123,228

A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.

24
Share capital
Group and company
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
50,667
50,667
50,667
50,667
25
Reserves

Revaluation reserve

 

Group

The revaluation reserve of £1,603,223 (2022 - £1,618,757) arose on revaluation of land and buildings on first time adoption of FRS 102.

 

Capital redemption reserve

 

Group and Company

The capital redemption reserve arose on a purchase of own shares.

 

Profit and loss account

 

Group

The profit and loss account represents the retained earnings of the group and includes non-distributable reserves of £445,803 (2022 - £445,803).

 

Company

The profit and loss account represents the retained earnings of the company and includes non-distributable reserves of £2,115,497 (2022 - £2,115,497).

N.K. HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2023
- 35 -
26
Operating lease commitments
Lessee

At the reporting end date the group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

Group
Company
2023
2022
2023
2022
£
£
£
£
Within one year
34,374
20,928
-
-
Between two and five years
35,636
20,732
-
-
70,010
41,660
-
-
Lessor

The operating leases represent leases of premises to third parties. The leases are negotiated over various terms.

At the reporting end date the group had contracted with tenants for the following minimum lease payments:

 

Group
Company
2023
2022
2023
2022
£
£
£
£
Within one year
67,000
78,660
362,000
373,660
Between two and five years
5,583
72,583
1,185,583
1,252,583
In over five years
-
-
49,167
344,167
72,583
151,243
1,596,750
1,970,410
27
Related party transactions
Remuneration of key management personnel

The remuneration of key management personnel is as follows.

2023
2022
£
£
Aggregate compensation
894,969
697,019
Transactions with related parties

During the year, land was sold with a carrying value of £65,579 from the company to a company which is related by virtue of common ownership, for consideration of £1.

N.K. HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2023
- 36 -
28
Directors' transactions

Dividends totalling £740,000 (2022 - £640,000) were paid in the year in respect of shares held by the company's directors.

At 1 May 2022 the balance due from the group to a director was £94,542. During the year this director made withdrawals totalling £228,846 and made repayments totalling £294,690. The amount due from the group at the year end to this director was £160,386. No interest was charged on the outstanding balance.

 

At 1 May 2022 the balance due from the group to a director was £59,236. During the year this director made withdrawals totalling £345,746 and made repayments totalling £445,310. The amount due from the group at the year end to this director was £158,800. No interest was charged on the outstanding balance.

 

An interest free loan of £500,000 has been advanced by the company to its directors. No repayments have been made in the year. No interest is payable to the company in respect of the loan and the loan is repayable by 31 January 2024.

29
Controlling party

The ultimate controlling party is considered to be Mr A Davidson who is the majority shareholder of the issued share capital.

30
Cash generated from group operations
2023
2022
£
£
Profit for the year after tax
1,773,129
957,814
Adjustments for:
Taxation charged
412,363
218,451
Finance costs
155,622
122,058
Investment income
(2,340)
(116)
Gain on disposal of tangible fixed assets
(387,808)
(185,560)
Loss on disposal of investment property
65,578
-
0
Depreciation and impairment of tangible fixed assets
920,605
808,236
Foreign exchange gains on cash equivalents
-
(71)
Movements in working capital:
Decrease/(increase) in stocks
49,813
(176,243)
Increase in debtors
(37,762)
(1,071,836)
(Decrease)/increase in creditors
(216,885)
807,598
Decrease in deferred income
(63)
(64)
Cash generated from operations
2,732,252
1,480,267

 

N.K. HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2023
- 37 -
31
Cash (absorbed by)/generated from operations - company
2023
2022
£
£
Profit for the year after tax
1,727,243
962,739
Adjustments for:
Taxation charged
82,338
121,018
Finance costs
5,330
1,314
Investment income
(1,226,191)
(400,069)
Gain on disposal of investment property
(297,341)
(187,585)
Fair value gain on investment properties
-
0
(112,415)
Movements in working capital:
Increase in debtors
(701,338)
(182,017)
Increase in creditors
208,980
67,927
Cash (absorbed by)/generated from operations
(200,979)
270,912
32
Analysis of changes in net funds/(debt) - group
1 May 2022
Cash flows
Acquisitions and disposals
New finance leases
30 April 2023
£
£
£
£
£
Cash at bank and in hand
2,370,828
(199,663)
-
-
2,171,165
Borrowings excluding overdrafts
(1,399,232)
215,895
(475,000)
-
(1,658,337)
Obligations under finance leases
(539,180)
534,375
-
(802,612)
(807,417)
432,416
550,607
(475,000)
(802,612)
(294,589)
33
Analysis of changes in net funds - company
1 May 2022
Cash flows
Acquisitions and disposals
30 April 2023
£
£
£
£
Cash at bank and in hand
652,096
(260,107)
-
391,989
Borrowings excluding overdrafts
(8,305)
19,159
(325,000)
(314,146)
643,791
(240,948)
(325,000)
77,843
2023-04-302022-05-01falseCCH SoftwareCCH Accounts Production 2023.200No description of principal activityMr A DavidsonMr P DavidsonMr S 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