Company Registration No. 00555418 (England and Wales)
H.L. THORNE & CO. LIMITED
CONSOLIDATED ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
H.L. THORNE & CO. LIMITED
COMPANY INFORMATION
DIRECTORS
Mr M R Thorne
Mrs S A Thorne
Mr G E Thorne
Mr A C W Brown    (Appointed 3 October 2022)
Mr M K Turner (Appointed 3 October 2022)
SECRETARY
Mr A C W Brown
COMPANY NUMBER
00555418
REGISTERED OFFICE
The Metal Works
Union Road
Oldbury
West Midlands
England
B69 3EX
AUDITORS
JW Hinks LLP
Chartered Accountants
19 Highfield Road
Edgbaston
Birmingham
B15 3BH
H.L. THORNE & CO. LIMITED
CONTENTS
PAGE
Strategic report
1 - 2
Directors' report
3
Directors' responsibilities statement
4
Independent auditor's report
5 - 7
Profit and loss account
8
Group statement of comprehensive income
9
Group balance sheet
10
Company balance sheet
11
Group statement of changes in equity
12
Company statement of changes in equity
13
Group statement of cash flows
14
Notes to the financial statements
15 - 32
H.L. THORNE & CO. LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2023
- 1 -

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

 

FAIR REVIEW OF THE BUSINESS

 

The results for the year and financial position of the group are as shown in the annexed financial statements.

 

We aim to present a balanced comprehensive review of the development and performance of our business during the year and its position at the year end. Our review is consistent with the size and non-complex nature of our business and is written in the context of the risks and uncertainties we face.

 

We consider that our key financial performance indicators are those that communicate financial performance and strength of the group as a whole, these being turnover and gross margin.

 

Turnover and gross margin of the group were as follows:

 

 

 

 

2023

 

2022

 

 

 

£’000

 

£’000

 

 

 

 

 

 

Turnover

 

 

74,309

 

66,312

Gross profit

 

 

2,173

 

2,195

Gross margin

 

 

2.92%

 

3.30%

 

 

 

=====

 

======

 

 

H.L. THORNE & CO. LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 2 -
PRINCIPAL RISKS AND UNCERTAINTIES

 

The group's principal financial instruments comprise cash and short-term deposits. The main purpose of these financial instruments is to raise finance for the group's operations. The group has various other financial instruments such as trade debtors and trade creditors, which arise directly from its operations. The group does not enter into derivative transactions.

 

It is, and has been throughout the period under review, the group's policy that no trading in financial instruments shall be undertaken. The main risks arising from the group's financial instruments are interest rate risk, credit risk, liquidity risk and currency risk. The board reviews and agrees policies for managing each of these risks and they are summarised below.

 

lnterest rate risk

The group's exposure to market risk for changes in interest rates is minimal due to the group having no loans or overdrafts. The additional requirement for medium to long term debt finance will be reviewed by the directors based the group's forecast requirements.

 

Credit risk

The group trades with only recognised, credit worthy third parties. lt is the group policy that all customers who wish to trade on credit terms are subject to credit vetting procedures. ln addition, receivable balances are monitored on an ongoing basis with the result that the group's exposure to bad debts is not significant.

 

Liquidity risk

The group's objective is to maintain a balance between continuity of funding and flexibility through the use of cash and short term deposits.

 

Currency risk

The group minimises its exposure to currency risk through the use of hedge funds and foreign bank accounts.

 

 

 

 

On behalf of the board

Mr G E Thorne
DIRECTOR
2 November 2023
H.L. THORNE & CO. LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2023
- 3 -

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

PRINCIPAL ACTIVITIES

The principal activity of the company and group continued to be that of a metal recycling company.

DIRECTORS

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

Mr M R Thorne
Mrs S A Thorne
Mr G E Thorne
Mr A C W Brown (Appointed 3 October 2022)
Mr M K Turner (Appointed 3 October 2022)
RESULTS AND DIVIDENDS

The results for the year are set out on page 8.

No ordinary dividends were paid. The directors do not recommend payment of a further dividend.

AUDITOR

In accordance with the company's articles, a resolution proposing that JW Hinks LLP be reappointed as auditor of the group will be put at a General Meeting.

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 G E Thorne
DIRECTOR
2 November 2023
H.L. THORNE & CO. LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 MARCH 2023
- 4 -

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.

H.L. THORNE & CO. LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF H.L. THORNE & CO. LIMITED
- 5 -
OPINION

We have audited the financial statements of H L Thorne & Co Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 March 2023 which comprise the group profit and loss account, 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 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.

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:

H.L. THORNE & CO. LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF H.L. THORNE & CO. LIMITED
- 6 -
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:

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.

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

 

We identified areas of laws and regulations that could reasonably be expected to have a material effect on the financial statements and discussed the policies and procedures regarding compliance.

Specific areas considered were as follows:

 

Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected all irregularities including those leading to material misstatements in the financial statements or non-compliance with regulation, even though we have properly planned and performed our audit in accordance with auditing standards.

This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.

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.

H.L. THORNE & CO. LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF H.L. THORNE & CO. LIMITED
- 7 -
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.

MARCUS ROSE FCA CTA (SENIOR STATUTORY AUDITOR)
FOR AND ON BEHALF OF JW HINKS LLP
CHARTERED ACCOUNTANTS
STATUTORY AUDITOR
19 Highfield Road
Edgbaston
Birmingham
B15 3BH
2 November 2023
H.L. THORNE & CO. LIMITED
GROUP PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 MARCH 2023
- 8 -
2023
2022
Notes
£
£
TURNOVER
3
74,309,215
66,312,042
Cost of sales
(72,136,112)
(64,116,725)
GROSS PROFIT
2,173,103
2,195,317
Administrative expenses
(2,174,614)
(1,604,710)
Other operating income
47,452
351,475
OPERATING PROFIT
4
45,941
942,082
Interest receivable and similar income
8
71,082
29,020
Interest payable and similar expenses
9
(94,697)
(51,216)
PROFIT BEFORE TAXATION
22,326
919,886
Tax on profit
10
(24,000)
(186,405)
(LOSS)/PROFIT FOR THE FINANCIAL YEAR
(1,674)
733,481
(Loss)/profit for the financial year is attributable to:
- Owners of the parent company
17,592
772,659
- Non-controlling interests
(19,266)
(39,178)
(1,674)
733,481

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

H.L. THORNE & CO. LIMITED
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2023
- 9 -
2023
2022
£
£
(LOSS)/PROFIT FOR THE YEAR
(1,674)
733,481
OTHER COMPREHENSIVE INCOME
Actuarial (loss)/gain on defined benefit pension schemes
(6,000)
36,000
TOTAL COMPREHENSIVE INCOME FOR THE YEAR
(7,674)
769,481
Total comprehensive income for the year is attributable to:
- Owners of the parent company
11,592
808,659
- Non-controlling interests
(19,266)
(39,178)
(7,674)
769,481
H.L. THORNE & CO. LIMITED
GROUP BALANCE SHEET
AS AT
31 MARCH 2023
31 March 2023
- 10 -
2023
2022
Notes
£
£
£
£
FIXED ASSETS
Tangible assets
11
2,485,675
2,111,153
CURRENT ASSETS
Stocks
15
5,038,368
4,183,861
Debtors
16
7,486,077
8,006,491
Cash at bank and in hand
316,250
1,145,685
12,840,695
13,336,037
CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
17
(6,364,781)
(6,575,897)
NET CURRENT ASSETS
6,475,914
6,760,140
TOTAL ASSETS LESS CURRENT LIABILITIES
8,961,589
8,871,293
CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR
18
(77,188)
(3,218)
PROVISIONS FOR LIABILITIES
22
(37,000)
(13,000)
NET ASSETS
8,847,401
8,855,075
CAPITAL AND RESERVES
Called up share capital
23
3,362
3,362
Profit and loss reserves
8,906,188
8,894,596
EQUITY ATTRIBUTABLE TO OWNERS OF THE PARENT COMPANY
8,909,550
8,897,958
NON-CONTROLLING INTERESTS
(62,149)
(42,883)
8,847,401
8,855,075
The financial statements were approved by the board of directors and authorised for issue on 2 November 2023 and are signed on its behalf by:
02 November 2023
Mr G E Thorne
DIRECTOR
H.L. THORNE & CO. LIMITED
COMPANY BALANCE SHEET
AS AT 31 MARCH 2023
31 March 2023
- 11 -
2023
2022
Notes
£
£
£
£
FIXED ASSETS
Tangible assets
11
2,485,675
2,111,153
Investments
12
10
10
2,485,685
2,111,163
CURRENT ASSETS
Stocks
15
5,038,368
4,183,861
Debtors
16
7,432,376
7,771,802
Cash at bank and in hand
316,248
1,145,683
12,786,992
13,101,346
CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
17
(6,050,412)
(6,160,816)
NET CURRENT ASSETS
6,736,580
6,940,530
TOTAL ASSETS LESS CURRENT LIABILITIES
9,222,265
9,051,693
CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR
18
(77,188)
(3,218)
PROVISIONS FOR LIABILITIES
22
(37,000)
(13,000)
NET ASSETS
9,108,077
9,035,475
CAPITAL AND RESERVES
Called up share capital
23
3,362
3,362
Profit and loss reserves
9,104,715
9,032,113
TOTAL EQUITY
9,108,077
9,035,475

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 £78,602 (2022 - profit of £518,170).

The financial statements were approved by the board of directors and authorised for issue on 2 November 2023 and are signed on its behalf by:
02 November 2023
Mr G E Thorne
DIRECTOR
COMPANY REGISTRATION NO. 00555418
H.L. THORNE & CO. LIMITED
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2023
- 12 -
Share capital
Profit and loss reserves
Total controlling interest
Non-controlling interest
Total
£
£
£
£
£
BALANCE AT 1 APRIL 2021
3,362
8,085,937
8,089,299
(3,705)
8,085,594
YEAR ENDED 31 MARCH 2022:
Profit for the year
-
772,659
772,659
(39,178)
733,481
Other comprehensive income:
Actuarial gains on defined benefit plans
-
36,000
36,000
-
36,000
Total comprehensive income
-
808,659
808,659
(39,178)
769,481
BALANCE AT 31 MARCH 2022
3,362
8,894,596
8,897,958
(42,883)
8,855,075
YEAR ENDED 31 MARCH 2023:
Loss for the year
-
17,592
17,592
(19,266)
(1,674)
Other comprehensive income:
Actuarial gains on defined benefit plans
-
(6,000)
(6,000)
-
(6,000)
Total comprehensive income
-
11,592
11,592
(19,266)
(7,674)
BALANCE AT 31 MARCH 2023
3,362
8,906,188
8,909,550
(62,149)
8,847,401
H.L. THORNE & CO. LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2023
- 13 -
Share capital
Profit and loss reserves
Total
£
£
£
BALANCE AT 1 APRIL 2021
3,362
8,477,943
8,481,305
YEAR ENDED 31 MARCH 2022:
Profit for the year
-
518,170
518,170
Other comprehensive income:
Actuarial gains on defined benefit plans
-
36,000
36,000
Total comprehensive income
-
554,170
554,170
BALANCE AT 31 MARCH 2022
3,362
9,032,113
9,035,475
YEAR ENDED 31 MARCH 2023:
Profit for the year
-
78,602
78,602
Other comprehensive income:
Actuarial gains on defined benefit plans
-
(6,000)
(6,000)
Total comprehensive income
-
72,602
72,602
BALANCE AT 31 MARCH 2023
3,362
9,104,715
9,108,077
H.L. THORNE & CO. LIMITED
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2023
- 14 -
2023
2022
Notes
£
£
£
£
CASH FLOWS FROM OPERATING ACTIVITIES
Cash (absorbed by)/generated from operations
28
(64,436)
937,235
Interest paid
(94,697)
(51,216)
Income taxes paid
(188,405)
(70,764)
NET CASH (OUTFLOW)/INFLOW FROM OPERATING ACTIVITIES
(347,538)
815,255
INVESTING ACTIVITIES
Purchase of tangible fixed assets
(526,538)
(89,974)
Proceeds from disposal of tangible fixed assets
61,599
13,250
Interest received
1,082
20
NET CASH USED IN INVESTING ACTIVITIES
(463,857)
(76,704)
FINANCING ACTIVITIES
Purchase of derivatives
50,535
198,606
Payment of finance leases obligations
(68,575)
(37,130)
NET CASH (USED IN)/GENERATED FROM FINANCING ACTIVITIES
(18,040)
161,476
NET (DECREASE)/INCREASE IN CASH AND CASH EQUIVALENTS
(829,435)
900,027
Cash and cash equivalents at beginning of year
1,145,685
245,658
CASH AND CASH EQUIVALENTS AT END OF YEAR
316,250
1,145,685
H.L. THORNE & CO. LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
- 15 -
1
ACCOUNTING POLICIES
COMPANY INFORMATION

H.L. Thorne & Co. Limited (“the Company”) is a limited company domiciled and incorporated in England and Wales. The registered office and trading address is The Metal Works, Union Street, Oldbury, West Midlands, B69 3EX.

 

The Group consists of H.L. Thorne & Co. 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, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

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

The company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements for parent company information presented within the consolidated financial statements:

 

1.2
BUSINESS COMBINATIONS

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.

1.3
BASIS OF CONSOLIDATION

The consolidated group financial statements consist of the financial statements of the parent company H L Thorne & Co 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 31 March 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.

H.L. THORNE & CO. LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
ACCOUNTING POLICIES
(Continued)
- 16 -

Entities in which the group holds an interest and which are jointly controlled by the group and one or more other venturers under a contractual arrangement are treated as joint ventures. Entities other than subsidiary undertakings or joint ventures, in which the group has a participating interest and over whose operating and financial policies the group exercises a significant influence, are treated as associates.

Investments in joint ventures and associates are carried in the group balance sheet at cost plus post-acquisition changes in the group’s share of the net assets of the entity, less any impairment in value. The carrying values of investments in joint ventures and associates include acquired goodwill.

 

If the group’s share of losses in a joint venture or associate equals or exceeds its investment in the joint venture or associate, the group does not recognise further losses unless it has incurred obligations to do so or has made payments on behalf of the joint venture or associate.

 

Unrealised gains arising from transactions with joint ventures and associates are eliminated to the extent of the group’s interest in the entity.

1.4
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.

1.5
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.

1.6
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.

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
2% on cost
Plant and equipment
at varying rates on cost
Fixtures and fittings
at varying rates on cost
Motor vehicles
25% on reducing balance

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

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.

H.L. THORNE & CO. LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
ACCOUNTING POLICIES
(Continued)
- 17 -

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.

An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The group considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.

 

Investments in associates are initially recognised at the transaction price (including transaction costs) and are subsequently adjusted to reflect the group’s share of the profit or loss, other comprehensive income and equity of the associate using the equity method. Any difference between the cost of acquisition and the share of the fair value of the net identifiable assets of the associate on acquisition is recognised as goodwill. Any unamortised balance of goodwill is included in the carrying value of the investment in associates.

 

Losses in excess of the carrying amount of an investment in an associate are recorded as a provision only when the company has incurred legal or constructive obligations or has made payments on behalf of the associate.

 

In the parent company financial statements, investments in associates are accounted for at cost less impairment.

Entities in which the group has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.

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.

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.

H.L. THORNE & CO. LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
ACCOUNTING POLICIES
(Continued)
- 18 -
1.10
CASH AND CASH EQUIVALENTS

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.

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.

H.L. THORNE & CO. LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
ACCOUNTING POLICIES
(Continued)
- 19 -
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.

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
DERIVATIVES

Derivatives are initially recognised at fair value at the date a derivative contract is entered into and are subsequently remeasured to fair value at each reporting end date. The resulting gain or loss is recognised in profit or loss immediately unless the derivative is designated and effective as a hedging instrument, in which event the timing of the recognition in profit or loss depends on the nature of the hedge relationship.

 

A derivative with a positive fair value is recognised as a financial asset, whereas a derivative with a negative fair value is recognised as a financial liability.

1.14
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.

H.L. THORNE & CO. LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
ACCOUNTING POLICIES
(Continued)
- 20 -
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.

1.15
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.

1.16
RETIREMENT BENEFITS

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

1.17
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.

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.

H.L. THORNE & CO. LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 21 -
3
TURNOVER AND OTHER REVENUE

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

2023
2022
£
£
TURNOVER ANALYSED BY CLASS OF BUSINESS
Scrap metal sales
74,309,215
66,312,042
2023
2022
£
£
TURNOVER ANALYSED BY GEOGRAPHICAL MARKET
United Kingdom
25,052,218
21,459,966
Europe
15,875,261
17,537,587
Rest of the World
33,381,736
27,314,489
74,309,215
66,312,042
2023
2022
£
£
OTHER REVENUE
Interest income
71,082
29,020
Commissions received
22,452
-
4
OPERATING PROFIT
2023
2022
£
£
Operating profit for the year is stated after charging/(crediting):
Exchange gains
(96,145)
(9,745)
Depreciation of owned tangible fixed assets
243,333
121,523
Depreciation of tangible fixed assets held under finance leases
69,873
31,680
Profit on disposal of tangible fixed assets
(33,118)
(8,883)
Cost of stocks recognised as an expense
71,715,001
63,776,194

Exchange differences recognised in profit or loss during the year, except for those arising on financial instruments measured at fair value through profit or loss, amounted to £96,145 (2022 - £9,745).

5
AUDITORS' REMUNERATION
2023
2022
Fees payable to the company's auditor and its associates:
£
£
FOR AUDIT SERVICES
Audit of the financial statements of the group and company
20,000
19,400
Audit of the company's subsidiaries
9,200
8,900
29,200
28,300
FOR SERVICES IN RESPECT OF ASSOCIATED PENSION SCHEMES
Audit
1,600
1,500
H.L. THORNE & CO. LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 22 -
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
Administration and operations
18
15
18
15
Directors
5
4
5
4
23
19
23
19

Their aggregate remuneration comprised:

Group
Company
2023
2022
2023
2022
£
£
£
£
Wages and salaries
1,164,153
979,988
1,164,153
979,988
Social security costs
106,447
77,894
106,447
77,894
Pension costs
85,001
80,655
85,001
80,655
1,355,601
1,138,537
1,355,601
1,138,537
7
DIRECTORS' REMUNERATION
2023
2022
£
£
Remuneration for qualifying services
424,071
342,930
Company pension contributions to defined contribution schemes
5,575
5,894
429,646
348,824
Remuneration disclosed above includes the following amounts paid to the highest paid director:
2023
2022
£
£
Remuneration for qualifying services
162,157
165,806

2 directors receive accruing retirement benefits under money purchase schemes (2022: 2).

8
INTEREST RECEIVABLE AND SIMILAR INCOME
2023
2022
£
£
INTEREST INCOME
Interest on the net defined benefit asset
70,000
29,000
Other interest income
1,082
20
Total income
71,082
29,020
H.L. THORNE & CO. LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 23 -
9
INTEREST PAYABLE AND SIMILAR EXPENSES
2023
2022
£
£
Other interest on financial liabilities
94,697
51,216
10
TAXATION
2023
2022
£
£
UK corporation tax on profits for the current period
-
0
188,405
DEFERRED TAX
Origination and reversal of timing differences
24,000
(2,000)
Total tax charge
24,000
186,405

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 / (loss) on ordinary activities before tax
22,326
919,886
Expected tax charge based on the standard rate of corporation tax in the UK of 19.00% (2022: 19.00%)
4,242
174,778
Tax effect of expenses that are not deductible in determining taxable profit
151
7,228
Unutilised tax losses carried forward
68,989
-
0
Permanent capital allowances in excess of depreciation
(73,382)
6,399
Deferred tax movement
24,000
(2,000)
Tax expense for the year
24,000
186,405
H.L. THORNE & CO. LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 24 -
11
TANGIBLE FIXED ASSETS
GROUP
Freehold land and buildings
Plant and equipment
Fixtures and fittings
Motor vehicles
Total
£
£
£
£
£
COST
At 1 April 2022
2,206,165
394,216
241,704
381,238
3,223,323
Additions
154,778
183,284
18,436
359,711
716,209
Disposals
(266)
-
0
(167,942)
(110,749)
(278,957)
At 31 March 2023
2,360,677
577,500
92,198
630,200
3,660,575
DEPRECIATION AND IMPAIRMENT
At 1 April 2022
329,263
309,393
219,698
253,816
1,112,170
Depreciation charged in the year
97,895
75,328
22,562
117,421
313,206
Eliminated in respect of disposals
(266)
-
0
(167,942)
(82,268)
(250,476)
At 31 March 2023
426,892
384,721
74,318
288,969
1,174,900
CARRYING AMOUNT
At 31 March 2023
1,933,785
192,779
17,880
341,231
2,485,675
At 31 March 2022
1,876,902
84,823
22,006
127,422
2,111,153
COMPANY
Freehold land and buildings
Plant and equipment
Fixtures and fittings
Motor vehicles
Total
£
£
£
£
£
COST
At 1 April 2022
2,206,165
394,216
241,704
381,238
3,223,323
Additions
154,778
183,284
18,436
359,711
716,209
Disposals
(266)
-
0
(167,942)
(110,749)
(278,957)
At 31 March 2023
2,360,677
577,500
92,198
630,200
3,660,575
DEPRECIATION AND IMPAIRMENT
At 1 April 2022
329,263
309,393
219,698
253,816
1,112,170
Depreciation charged in the year
97,895
75,328
22,562
117,421
313,206
Eliminated in respect of disposals
(266)
-
0
(167,942)
(82,268)
(250,476)
At 31 March 2023
426,892
384,721
74,318
288,969
1,174,900
CARRYING AMOUNT
At 31 March 2023
1,933,785
192,779
17,880
341,231
2,485,675
At 31 March 2022
1,876,903
84,823
22,005
127,422
2,111,153
H.L. THORNE & CO. LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
11
TANGIBLE FIXED ASSETS
(Continued)
- 25 -

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
£
£
£
£
Property improvements
38,352
-
38,352
-
Plant and equipment
38,351
-
38,351
-
0
Motor vehicles
88,755
36,541
88,755
36,541
165,458
36,541
165,458
36,541
Depreciation charge for the year in respect of leased assets
69,873
12,180
69,873
12,180
12
FIXED ASSET INVESTMENTS
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Investments in subsidiaries
13
-
0
-
0
10
10
MOVEMENTS IN FIXED ASSET INVESTMENTS
COMPANY
Shares in subsidiaries
£
COST OR VALUATION
At 1 April 2022 and 31 March 2023
10
CARRYING AMOUNT
At 31 March 2023
10
At 31 March 2022
10
13
SUBSIDIARIES

Details of the company's subsidiaries at 31 March 2023 are as follows:

Name of undertaking
Registered office
Class of
% Held
shares held
Direct
Thorne Metal Recyclers Limited
England
Ordinary
76.00
Thorne Metals Limited
England
Ordinary
100.00

All subsidiaries are registered at the same address as H.L. Thorne & Co Limited.

H.L. THORNE & CO. LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 26 -
14
FINANCIAL INSTRUMENTS
Group
Company
2023
2022
2023
2022
£
£
£
£
CARRYING AMOUNT OF FINANCIAL ASSETS
Instruments measured at fair value through profit or loss
16,682
64,847
12,145
-
CARRYING AMOUNT OF FINANCIAL LIABILITIES
Measured at fair value through profit or loss
- Other financial liabilities
145,540
143,170
145,540
143,170
15
STOCKS
Group
Company
2023
2022
2023
2022
£
£
£
£
Metal stocks
5,038,368
4,183,861
5,038,368
4,183,861
16
DEBTORS
Group
Company
2023
2022
2023
2022
AMOUNTS FALLING DUE WITHIN ONE YEAR:
£
£
£
£
Trade debtors
6,595,033
6,509,061
4,866,450
5,532,174
Amounts owed by group undertakings
-
-
1,679,419
807,045
Derivative financial instruments
16,682
64,847
12,145
-
Other debtors
767,267
1,263,092
767,267
1,263,092
Prepayments and accrued income
107,095
169,491
107,095
169,491
7,486,077
8,006,491
7,432,376
7,771,802
17
CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Obligations under finance leases
20
66,594
19,468
66,594
19,468
Trade creditors
5,174,351
5,424,802
4,877,603
5,072,721
Corporation tax payable
-
0
188,405
-
0
137,900
Other taxation and social security
44,368
34,559
40,524
34,559
Derivative financial instruments
145,540
143,170
145,540
143,170
Other creditors
371,271
271,942
369,557
270,010
Accruals and deferred income
562,657
493,551
550,594
482,988
6,364,781
6,575,897
6,050,412
6,160,816
H.L. THORNE & CO. LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 27 -
18
CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Obligations under finance leases
20
77,188
3,218
77,188
3,218
19
LOANS AND OVERDRAFTS
Group
Company
2023
2022
2023
2022
£
£
£
£
Directors' loans
-
0
(2,927)
-
0
(2,927)
Payable within one year
-
0
(2,927)
-
0
(2,927)
20
FINANCE LEASE OBLIGATIONS
Group
Company
2023
2022
2023
2022
£
£
£
£
Future minimum lease payments due under finance leases:
Within one year
66,594
19,468
66,594
19,468
In two to five years
77,188
3,218
77,188
3,218
143,782
22,686
143,782
22,686
21
RETIREMENT BENEFIT SCHEMES
2023
2022
DEFINED CONTRIBUTION SCHEMES
£
£
Charge to profit or loss in respect of defined contribution schemes
21,001
15,655
DEFINED BENEFIT SCHEME - COMPANY

The company operates a defined benefit scheme for qualifying employees.

 

The most recent actuarial valuations of plan assets and the present value of the defined benefit obligation were carried out at 1 April 2020 by Atkin & Co, Fellow of the Institute of Actuaries. The present value of the defined benefit obligation, the related current service cost and past service cost were measured using the projected unit credit method.

2023
2022
Key assumptions
%
%
Discount rate
4.6
2.65
Expected rate of increase of pensions in payment
3.45
3.5
Expected rate of increase in deferred pensions
2.85
3.65
H.L. THORNE & CO. LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
21
RETIREMENT BENEFIT SCHEMES
(Continued)
- 28 -
Mortality assumptions
2023
2022

Assumed life expectations on retirement at age 65:

Years
Years
Retiring today
- Males
21.4
22
Retiring in 20 years
- Males
22.6
23.2

The amounts included in the balance sheet arising from the company's obligations in respect of defined benefit plans are as follows:

COMPANY
2023
2022
£
£
Present value of defined benefit obligations
4,675,000
5,679,000
Fair value of plan assets
(4,675,000)
(5,679,000)
Deficit in scheme
-
-
Total liability recognised
-
-
GROUP
2023
2022
Amounts recognised in the profit and loss account
£
£
Current service cost
64,000
65,000
Net interest on net defined benefit liability/(asset)
(70,000)
(29,000)
Total costs/(income)
(6,000)
36,000
GROUP
2023
2022
Amounts taken to other comprehensive income
£
£
Actual return on scheme assets
723,000
18,000
Less: calculated interest element
218,000
144,000
Return on scheme assets excluding interest income
941,000
162,000
Actuarial changes related to obligations
(935,000)
(198,000)
Total costs
6,000
(36,000)
H.L. THORNE & CO. LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
21
RETIREMENT BENEFIT SCHEMES
(Continued)
- 29 -
Group
Company
2023
2023

Movements in the present value of defined benefit obligations

£
£
Liabilities at 1 April 2022
5,679,000
5,679,000
Current service cost
64,000
64,000
Benefits paid
(281,000)
(281,000)
Actuarial gains and losses
(935,000)
(935,000)
Interest cost
148,000
148,000
At 31 March 2023
4,675,000
4,675,000
Group
Company
2023
2023

The defined benefit obligations arise from plans funded as follows:

£
£
Wholly unfunded obligations
-
-
Wholly or partly funded obligations
4,675,000
4,675,000
4,675,000
4,675,000
Group
Company
2023
2023

Movements in the fair value of plan assets

£
£
Fair value of assets at 1 April 2022
5,679,000
5,679,000
Interest income
218,000
218,000
Return on plan assets (excluding amounts included in net interest)
(941,000)
(941,000)
Benefits paid
(281,000)
(281,000)
At 31 March 2023
4,675,000
4,675,000

The actual return on plan assets was £218,000 (2022 - £144,000).

Fair value of plan assets at the reporting period end

Group
Company
2023
2022
2023
2022
£
£
£
£
Equity instruments
5,573,400
5,426,200
5,573,400
5,426,200
Debt instruments
557,340
667,840
557,340
667,840
Property
238,860
417,400
238,860
417,400
Other
1,592,400
1,836,560
1,592,400
1,836,560
Surplus restriction
(3,287,000)
(2,669,000)
(3,287,000)
(2,669,000)
4,675,000
5,679,000
4,675,000
5,679,000
H.L. THORNE & CO. LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 30 -
22
DEFERRED TAXATION

Deferred tax assets and liabilities are offset where the group or company has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:

Liabilities
Liabilities
2023
2022
GROUP
£
£
Accelerated capital allowances
82,000
13,000
Tax losses
(45,000)
-
37,000
13,000
Liabilities
Liabilities
2023
2022
COMPANY
£
£
Accelerated capital allowances
82,000
13,000
Tax losses
(45,000)
-
37,000
13,000
Group
Company
2023
2023
MOVEMENTS IN THE YEAR:
£
£
Liability at 1 April 2022
13,000
13,000
Charge to profit or loss
24,000
24,000
Liability at 31 March 2023
37,000
37,000
23
SHARE CAPITAL
Group and company
2023
2022
ORDINARY SHARE CAPITAL
£
£
ISSUED AND FULLY PAID
3,000 Deferred ordinary shares of £1 each
3,000
3,000
3,623 Ordinary shares of 10p each
362
362
3,362
3,362

All shares rank Pari Passu in all circumstances. The ordinary shares are not redeemable.

24
FINANCIAL COMMITMENTS, GUARANTEES AND CONTINGENT LIABILITIES

The group had no contingent liabilities at 31 March 2023 or at 31 March 2022.

H.L. THORNE & CO. LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 31 -
25
CAPITAL COMMITMENTS

Amounts contracted for but not provided in the financial statements:

Group
Company
2023
2022
2023
2022
£
£
£
£
Acquisition of tangible fixed assets
232,628
66,950
232,628
66,950
26
RELATED PARTY TRANSACTIONS
REMUNERATION OF KEY MANAGEMENT PERSONNEL

The remuneration of key management personnel is as follows.

2023
2022
£
£
Aggregate compensation
429,647
348,824
OTHER INFORMATION

H.L. Thorne & Co. Limited Retirement Benefits Scheme

 

Included within other debtors is an amount of £nil (2022: £4,348) due from H.L. Thorne & Co. Limited Retirement Benefit Scheme.

 

Thorne Family Trusts

 

During the year the company received loan advances from various trusts controlled by the Thorne family in the sum of £1,665,000. These loans were fully repaid prior to 31 March 2023. H.L. Thorne & Co. Limited paid loan interest of £29,119 to the various trusts controlled by the Thorne family. As at the 31 March 2023 an amount of £nil was due to H.L. Thorne & Co. Limited from the Thorne Family Trusts (2022: £2,364).

 

Thorne Timber Company Limited

 

As at 31 March 2023 an amount of nil (2022: £564) was due to H.L. Thorne & Co. Limited from the Thorne Timber Company Limited. Thorne Timber Company Limited is under the ultimate control of the Thorne family.

27
CONTROLLING PARTY

Mr M R Thorne, Mrs S A Thorne, Mr G E Thorne and Mr J H Thorne acting as Trustees of the Thorne Family Trusts, control the company by virtue of their interest in 100% of the issued share capital.

 

H.L. THORNE & CO. LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 32 -
28
CASH (ABSORBED BY)/GENERATED FROM GROUP OPERATIONS
2023
2022
£
£
(Loss)/profit for the year after tax
(1,674)
733,481
ADJUSTMENTS FOR:
Taxation charged
24,000
186,405
Finance costs
94,697
51,216
Investment income
(71,082)
(29,020)
Gain on disposal of tangible fixed assets
(33,118)
(8,883)
Depreciation and impairment of tangible fixed assets
313,206
153,203
Pension scheme non-cash movement
64,000
65,000
MOVEMENTS IN WORKING CAPITAL:
(Increase)/decrease in stocks
(854,507)
1,079,806
Decrease/(increase) in debtors
472,249
(2,906,177)
(Decrease)/increase in creditors
(72,207)
1,612,204
CASH (ABSORBED BY)/GENERATED FROM OPERATIONS
(64,436)
937,235
29
ANALYSIS OF CHANGES IN NET FUNDS - GROUP
1 April 2022
Cash flows
New finance leases
31 March 2023
£
£
£
£
Cash at bank and in hand
1,145,685
(829,435)
-
316,250
Obligations under finance leases
(22,686)
68,575
(189,671)
(143,782)
1,122,999
(760,860)
(189,671)
172,468
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