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Registered number: SC583326













ROVOP HOLDINGS LIMITED






ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
 

 

 
ROVOP HOLDINGS LIMITED
 

COMPANY INFORMATION


Directors
M McBride 
G Park 
N Potter 
M Somerville 
D Larssen (appointed 13 March 2023)




Registered number
SC583326



Registered office
Silvertrees Drive
Westhill

Aberdeen

AB32 6BH




Independent auditor
Anderson Anderson & Brown Audit LLP

Kingshill View

Prime Four Business Park

Kingswells

Aberdeen

AB15 8PU





 
ROVOP HOLDINGS LIMITED
 

CONTENTS



Page
Group strategic report
1 - 3
Directors' report
4 - 6
Directors' responsibilities statement
7
Independent auditor's report
8 - 11
Consolidated statement of comprehensive income
12
Consolidated balance sheet
13
Company balance sheet
14
Consolidated statement of changes in equity
15
Company statement of changes in equity
16
Consolidated statement of cash flows
17 - 18
Consolidated analysis of net debt
19
Notes to the financial statements
20 - 39


 
ROVOP HOLDINGS LIMITED
 

GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2023

Introduction
 
The principal activity of the Group is the provision of remotely operated vehicle (ROV) services to the oil & gas, offshore wind and utilities industries.

Business review
The Group delivered revenue of £52.9m (2022: £40.3m) and gross profit of £18.6m (2022: £14.0m). This performance reflects a record year for the Group, driven by strong demand for the Group’s services and continued strong performance on operational delivery. Commercial asset utilisation levels were strong  at 50% across the entire fleet (2022: 38%) resulting in record operational ROV and personnel days. EBITDA* for the financial period was £11.0m (2022: £7.0m). This represents an EBITDA margin of 20.7% (2022: 17.3%) reflecting rates escalation and a more efficient cost structure in the business during the last twelve months.
The strong EBITDA performance was the main driver of the cash balance increasing to £9.5m (2022: £3.6m). This is after further capex investment in the Group's ROV fleet of £3.1m (2022: £2.3m).
The levels of activity have continued to grow since the end of the financial year resulting in profitability being at record monthly levels and on a trailing twelve-month basis. The Group is now benefitting from having several multi-vessel customers with truly global activity which helps reduce, but not eliminate, the traditionally seasonal nature of the northern hemisphere sector. Pricing in the market is also improving and the concepts of minimum contractual days and reservation fees for assets are now widespread. The market for ROV pilots is very tight and the Group has invested in dedicated recruitment resources which, along with our highly skilled crew, has ensured the Group has been able to maintain high levels of service.
In summary, the financial and operational performance of the Group was the strongest in its 11-year history and has accelerated again since the end of the financial year. The prospects for the foreseeable future are very strong and the Group continues to make improvements across all areas of the business to ensure it can capitalise on further opportunities for growth. 
*Profit before interest, tax, depreciation, amortisation, foreign exchange and exceptional items

Energy Transition
 
As reported in previous years' accounts, the Group has continued to focus on Environmental, Social and Governance (ESG) which is now part of its core practices and beliefs.
ROVOP now has a contracted core proportion of revenue from non oil and gas both in terms of offshore wind construction and, particularly, cable lay. These areas now constitute a significant ongoing percentage of the Group’s revenue and will continue to be the case based on the current customer and vessel mix. 

Page 1
 

 
ROVOP HOLDINGS LIMITED
 

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

Principal risks and uncertainties
 
Liquidity risk
The Group manages its liquidity risk by matching long term assets with long term debt and by maintaining sufficient cash and availability of funding through an adequate amount of committed credit facilities. The Group put in place a new external borrowing facility during the year, the details of which are contained in Note 21, and has prepared cash flow forecasts that show significant headroom under the related covenants. The Group also continues to have access to an invoice finance facility. 
Currency risk
The Group's exposure to the risk of changes in foreign currency rates relates to its operating activities (when revenue or expenses are denominated in a different currency from its functional currency) as well as the new debt facility which is denominated in US Dollars (USD).
The Company's principal exposure arises from income denominated in USD, with costs principally denominated in Sterling (GBP) which are not fully matched. The USD debt facility reduces the net FX exposure. The Group has entered into forward contracts to partially manage the residual USD exposure.
Credit risk
The Group has trade debtors of £10.8m (2022: £10.2m) and bank balances of £9.5m (2022: £3.6m).
The Group has established procedures to minimise the risk of default by trade debtors including detailed credit checks undertaken before a customer is accepted as well as contractual rights of enforcement and remedy.

Financial key performance indicators
 
The Group sets a series of Key Performance Indicators (KPIs) related to the financial performance of the business within its annual budget and monitors these throughout the year.
KPIs are reviewed on a weekly basis and, as well as financial KPI’s such as revenue, ROV days delivered, project contribution per ROV day and EBITDA. operational KPIs are also measured and discussed across HSEQ, HR, Operations and ESG data.
A key operational KPI is commercial asset utilisation as this is a main driver of profitability. Return on capital employed is another important metric reviewed on a regular basis, mainly when pricing potential new projects and making capital expenditure decisions.

Page 2
 

 
ROVOP HOLDINGS LIMITED
 

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

Directors' statement of compliance with duty to promote the success of the Group
 
The Directors recognise, both individually and collectively, their duty to act in a way which they consider, in good faith, would be most likely to promote the success of the Group for the benefit of its members as a whole in accordance with section 172 of the Companies Act 2006.
When making these decisions, the directors have given regard to:
• the likely consequences of any decision in the long term;
• the interests of the Group’s employees;
• the need to foster the Group’s business relationships with suppliers, customers and others;
• the impact of the Group’s operations on the community and the environment;
• the desirability of the Group maintaining a reputation for high standards of business conduct; and
• the need to act fairly as between shareholders of the Group.
The majority of stakeholder engagement is carried out by the Board of directors who meet on a regular basis. The Board considers and discusses information from across the organisation to help it understand the impact of the Group's operations, and the interests and views of our key stakeholders. It also reviews strategy, financial and operational performance as well as information covering areas such as key risks and legal and regulatory compliance.
As a result of these activities, the Board has an overview of engagement with stakeholders, and other relevant factors, which enables the directors to comply with their legal duty under section 172 of the Companies Act 2006


This report was approved by the Board and signed on its behalf.



G Park
Director

Date: 26 September 2023

Page 3
 

 
ROVOP HOLDINGS LIMITED
 
 
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2023

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

Results and dividends

The profit for the year, after tax, amounted to £3.4m (2022: loss of £6.6m).

The current year profit includes non-cash charges for interest of £5.8m (2022: £6.4m) and depreciation of £7.5m (2022: £7.1m). 

Directors

The directors who served during the year were:

M McBride 
G Park 
N Potter 
M Somerville 
D Larssen (appointed 13 March 2023)

Future developments

The directors are confident that the prospects for the market for the Group's services, coupled with the wider global customer base that has been built up over the last two years, will continue to drive growth in the business. The Group continues to generate a significant proportion of its revenue from offshore wind construction and cable lay. Activity on the vessels on which our assets are placed continues to be strong and looks set to continue for the foreseeable future. As a result of this high commercial utilisation and the improvement in pricing across the market, the Group continues to look at opportunities to increase the size of its fleet through the second-hand market as well as new-build work class ROVs.

Research and development activities

The Group and Company, in partnership with certain customers, continues to look for innovative systems and processes to ensure a high-quality service delivery.

Engagement with suppliers, customers and others

The Group has regular dialogue with all of its stakeholders across a wide variety of issues from commercial to environmental and believes that this approach is beneficial to the future for all interested parties.

Page 4
 

 
ROVOP HOLDINGS LIMITED
 

DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023

Greenhouse gas emissions, energy consumption and energy efficiency action

The Group fully recognises its responsibility to protect the environment and has a strong environmental policy, objectives and guidelines in place which are reviewed and updated regularly. The Group complies with all regulations covering the processing and disposal of toxic & non-toxic waste and uses qualified licensed contractors for the collection and disposal of waste where appropriate.
The following disclosures cover the Group’s UK subsidiaries’ emissions for the financial periods ending 31 March 2022 and 31 March 2023:
Energy use
During the current reporting period, a total of 269,051kWh (2022: 215,279kWh) of energy was used and a total of 51 tonnes of CO2e (2022: 44 tonnes of CO2e) was emitted.
The increase in emissions was primarily due to the increased use of gas and electricity due to various reasons such as weather conditions and more personnel returning to work in our offices post-Covid as well as increased activity in the workshops and across the business generally to meet higher customer demand.  
Energy efficiency action
The Group is committed to energy efficiency and the protection of the environment.  This commitment and the Group’s intentions are outlined in the corporate HSEQ policy, and procedures are in place to assess environmental aspects and impacts and reduce the corporate impact on the environment.  Examples of measures the Group takes to reduce environmental impacts and increase the efficiency of energy consumption are provided as follows:
 
Modern buildings with motion activated LED lighting systems
Thermostatic controls on heating and cooling systems
Commitment to electricity and gas use reduction year on year contained within the corporate management system objectives
Roll out of Carbon Net Zero Road Map to plan progress towards attainment of Net Zero operations in line with the government’s 2050 target
ROVOP is fully certified in line with ISO 14001:2015, by NQA

Intensity ratio
In the 2023 financial year, the Group emitted 0.97 tonnes of CO2e per £1 million turnover (2022: 1.10 tonnes).
Methodology
Data in relation to energy consumption has been gathered by the in house HSEQ department, using metrics provided from meter readings, vehicle mileage logs and fuel bills.
 
Electricity – amount purchased for use in the Aberdeen office and warehouse.
Gas combustion   amount purchased for central heating in the Aberdeen office.
Transport – amount of energy used by the Group when it is responsible for buying the fuel; includes fleet vehicles, hire cars, fuel/mileage claims refunded to employees when on business

No subsidiaries within the Group meet the reporting criteria, other than ROVOP Limited which has chosen not to disclose the information in its accounts. Therefore, no information is disclosed in respect of subsidiaries.

Page 5
 

 
ROVOP HOLDINGS LIMITED
 

DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023

Disclosure of information to auditors

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

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

Post balance sheet events

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

Auditor

The auditor, Anderson Anderson & Brown Audit LLPwill be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

This report was approved by the Board and signed on its behalf.
 





G Park
Director

Date: 26 September 2023

Page 6
 

 
ROVOP HOLDINGS LIMITED
 

DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 MARCH 2023

The directors are responsible for preparing the Group strategic report, the Directors' report and the consolidated financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and the Group and of the profit or loss of the Group for that period.

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

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

make judgements and accounting estimates that are reasonable and prudent;

state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;

prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group will continue in business.

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

Page 7
 

 
ROVOP HOLDINGS LIMITED
 
 
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ROVOP HOLDINGS LIMITED
 

Opinion


We have audited the financial statements of ROVOP Holdings Limited (the 'parent Company') and its subsidiaries (the 'Group') for the year ended 31 March 2023, which comprise the Consolidated statement of comprehensive income, the Consolidated balance sheet, the Company balance sheet, the Consolidated statement of cash flows, the Consolidated statement of changes in equity, the Company statement of changes in equity and the related notes, including a summary of significant accounting policiesThe financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).


In our opinion the financial statements:


give a true and fair view of the state of the Group's and of the parent Company's affairs as at 31 March 2023 and of the Group's profit for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.


Basis for opinion


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


Conclusions relating to going concern


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


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


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


Page 8
 

 
ROVOP HOLDINGS LIMITED

 

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ROVOP HOLDINGS LIMITED (CONTINUED)

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


We have nothing to report in this regard.


Opinion on other matters prescribed by the Companies Act 2006
 

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


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


Matters on which we are required to report by exception
 

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


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


adequate accounting records have not been kept by the parent Company, or returns adequate for our audit have not been received from branches not visited by us; or
the parent Company financial statements are not in agreement with the accounting records and returns; or
certain disclosures of directors' remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.


Responsibilities of directors
 

As explained more fully in the Directors' responsibilities statement set out on page 7, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.


In preparing the financial statements, the directors are responsible for assessing the Group's and the parent Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Group or the parent Company or to cease operations, or have no realistic alternative but to do so.


Page 9
 

 
ROVOP HOLDINGS LIMITED

 

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ROVOP HOLDINGS LIMITED (CONTINUED)

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 Group financial statements.


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

We obtained an understanding of the legal and regulatory frameworks within which the company operates, focusing on those laws and regulations that have a direct effect on the determination of material amounts and disclosures in the financial statements.
The laws and regulations we considered in this context were the Companies Act 2006 and UK Taxation
legislation.
We considered the opportunities and incentives that may exist within the organisation for fraud and identified the greatest potential for fraud in the following areas:

timing of revenue recognition
compliance with relevant laws and regulations which may impact on the financial statements and those that the company needs to comply with for the purpose of trading
management judgements applied in calculating provisions
management override of controls to manipulate the Group’s key performance indicators to meet targets.

We discussed these risks with client management, designed audit procedures to address these risks including:

reviewed internal documentation and correspondence with regulators for evidence or irregularities
testing a sample of sales transactions to source documents and review of recognition of income around the year end
consideration of the assumptions applied whether the judgements applied in calculation of provisions were appropriate
reviewed areas of judgement and tested a sample of journal entries for indicators of management bias
performed analytical procedures to identify any unusual or unexpected relationships which may be an indication of material misstatement due to fraud

Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. 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 for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditor's report.


Page 10
 

 
ROVOP HOLDINGS LIMITED

 

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ROVOP HOLDINGS LIMITED (CONTINUED)

Use of our report
 

This report is made solely to the Company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in an 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.





Christopher Masson (Senior statutory auditor)
  
for and on behalf of
Anderson Anderson & Brown Audit LLP
 
Statutory Auditor
  
Kingshill View
Prime Four Business Park
Kingswells
Aberdeen
AB15 8PU

26 September 2023
Page 11
 

 
ROVOP HOLDINGS LIMITED
 

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2023

2023
2022
Note
£
£

  

Turnover
 5 
52,993,963
40,347,464

Cost of sales
  
(34,895,523)
(26,362,258)

Gross profit
  
18,098,440
13,985,206

Administrative expenses
  
(7,123,566)
(7,005,361)

Other operating income
 6 
-
13,457

EBITDA
  
10,974,874
6,993,302

Depreciation
  
(7,490,099)
(7,146,979)

Exceptional items
  
6,074,978
3,391

Gain on foreign exchange
  
1,622,822
465,917

Interest receivable and similar income
  
541
-

Interest payable and similar expenses
 10 
(6,222,829)
(6,659,907)

Profit/(loss) before tax
  
4,960,287
(6,344,276)

Tax on profit/(loss)
 11 
(1,525,802)
(214,552)

Profit/(loss) for the financial year
  
3,434,485
(6,558,828)

  

Foreign exchange movement
  
266,731
25,001

Other comprehensive income for the year
  
266,731
25,001

Total comprehensive income for the year
  
3,701,216
(6,533,827)

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

The notes on pages 20 to 39 form part of these financial statements.

Page 12
 

 
ROVOP HOLDINGS LIMITED

REGISTERED NUMBER:SC583326

CONSOLIDATED BALANCE SHEET
AS AT 31 MARCH 2023

2023
2022
Note
£
£

Fixed assets
  

Tangible fixed assets
 13 
32,431,629
36,830,528

  
32,431,629
36,830,528

Current assets
  

Stocks
 15 
197,002
104,422

Debtors: amounts falling due within one year
 16 
17,838,520
16,459,264

Cash at bank and in hand
 17 
9,458,682
3,595,872

  
27,494,204
20,159,558

Creditors: amounts falling due within one year
 18 
(9,966,533)
(7,597,838)

Net current assets
  
 
 
17,527,671
 
 
12,561,720

Total assets less current liabilities
  
49,959,300
49,392,248

Creditors: Amounts falling due after more than one year
 19 
(20,430,000)
-

  
 
 
(20,430,000)
 
 
-

Net assets
  
29,529,300
49,392,248


Financed by:
  

Shareholder loans including amortised interest and unamortised issue costs
  
39,913,819
63,477,983

Capital and reserves
  

Called up share capital 
 24 
251,153
251,153

Share premium account
  
25,156,845
25,156,845

Capital redemption reserve
  
273
273

Foreign exchange reserve
  
299,368
32,637

Other reserves
  
5,004,340
5,004,340

Profit and loss account
  
(41,096,498)
(44,530,983)

  
29,529,300
49,392,248


The financial statements were approved and authorised for issue by the Board and were signed on its behalf by: 

G Park
Director

Date: 26 September 2023

Page 13
 

 
ROVOP HOLDINGS LIMITED

REGISTERED NUMBER:SC583326

COMPANY BALANCE SHEET
AS AT 31 MARCH 2023

2023
2022
Note
£
£

Fixed assets
  

Investments
 14 
30,211,063
30,211,063

  
30,211,063
30,211,063

Current assets
  

Debtors: amounts falling due within one year
 16 
1,000
-

Cash at bank and in hand
 17 
140
170

  
1,140
170

Creditors: amounts falling due within one year
 18 
(904,235)
(824,035)

Net current liabilities
  
 
 
(903,095)
 
 
(823,865)

Total assets less current liabilities
  
29,307,968
29,387,198

  

  

Net assets
  
29,307,968
29,387,198


Capital and reserves
  

Called up share capital 
 24 
251,153
251,153

Share premium account
  
25,156,845
25,156,845

Capital redemption reserve
  
273
273

Other reserves
  
5,004,340
5,004,340

Profit and loss account brought forward
  
(1,025,413)
(1,126,688)

(Loss)/profit for the year

  

(79,230)
101,275

Profit and loss account carried forward
  
(1,104,643)
(1,025,413)

  
29,307,968
29,387,198


The financial statements were approved and authorised for issue by the Board and were signed on its behalf by: 


G Park
Director

Date: 26 September 2023

The notes on pages 20 to 39 form part of these financial statements.

Page 14
 

 

ROVOP HOLDINGS LIMITED
 
 
 


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



Called up share capital
Share premium account
Capital redemption reserve
Foreign exchange reserve
Other reserves
Profit and loss account
Total equity


£
£
£
£
£
£
£



At 1 April 2021
251,153
25,156,845
273
7,636
5,004,340
(37,972,155)
(7,551,908)





Loss for the year
-
-
-
-
-
(6,558,828)
(6,558,828)


Foreign exchange movement
-
-
-
25,001
-
-
25,001





At 1 April 2022
251,153
25,156,845
273
32,637
5,004,340
(44,530,983)
(14,085,735)





Profit for the year
-
-
-
-
-
3,434,485
3,434,485


Foreign exchange movement
-
-
-
266,731
-
-
266,731



At 31 March 2023
251,153
25,156,845
273
299,368
5,004,340
(41,096,498)
(10,384,519)



The notes on pages 20 to 39 form part of these financial statements.

Page 15 
 

 

ROVOP HOLDINGS LIMITED
 
 
 


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



Called up share capital
Share premium account
Capital redemption reserve
Other reserves
Profit and loss account
Total equity


£
£
£
£
£
£



At 1 April 2021
251,153
25,156,845
273
5,004,340
(1,126,688)
29,285,923





Profit for the year
-
-
-
-
101,275
101,275





At 1 April 2022
251,153
25,156,845
273
5,004,340
(1,025,413)
29,387,198





Loss for the year
-
-
-
-
(79,230)
(79,230)



At 31 March 2023
251,153
25,156,845
273
5,004,340
(1,104,643)
29,307,968



The notes on pages 20 to 39 form part of these financial statements.

Page 16 
 

 
ROVOP HOLDINGS LIMITED
 

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

2023
2022
£
£

Cash flows from operating activities

Profit/(loss) for the financial year
3,434,485
(6,558,828)

Adjustments for:

Depreciation of tangible assets
7,490,040
7,146,979

Other interest payable
466,861
227,222

Non-cash interest payable
5,755,968
6,432,685

Tax charge
1,525,802
214,552

Increase in stocks
(92,580)
(18,534)

Increase in debtors
(1,386,675)
(6,269,878)

Increase in creditors
2,093,682
782,007

Corporation tax (paid)
(1,511,377)
(535,653)

Effect of foreign exchange rates
266,731
29,902

Interest recieved
(541)
-

Exceptional non-cash gain on settlement of loans
(9,118,674)
-

Other movements
(8,679)
-

Net cash generated from operating activities

8,915,043
1,450,454


Cash flows from investing activities

Interest received
541
-

Purchase of tangible fixed assets
(3,082,462)
(2,253,031)

Net cash from investing activities

(3,081,921)
(2,253,031)
Page 17
 

 
ROVOP HOLDINGS LIMITED
 

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


2023
2022

£
£



Cash flows from financing activities

New secured loans
24,394,347
1,000,000

Repayment of shareholder loans
(23,661,289)
-

Repayment of finance leases
-
(3,490)

Movements on working capital facility
268,004
389,492

Interest paid
(466,861)
(227,222)

Other foreign currency movements
(504,513)
-

Net cash used in financing activities
29,688
1,158,780

Net increase in cash and cash equivalents
5,862,810
356,203

Cash and cash equivalents at the beginning of year
3,595,872
3,239,669

Cash and cash equivalents at the end of year
9,458,682
3,595,872


Cash and cash equivalents at the end of year comprise:

Cash at bank and in hand
9,458,682
3,595,872

9,458,682
3,595,872


Page 18
 

 
ROVOP HOLDINGS LIMITED
 

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





At 1 April 2022
Cash flows
Other non-cash changes
At 31 March 2023
£

£

£

£

Cash at bank and in hand

3,595,872

5,862,810

-

9,458,682

Debt due after 1 year

(63,477,983)

(733,058)

3,867,222

(60,343,819)


(59,882,111)
5,129,752
3,867,222
(50,885,137)

The notes on pages 20 to 39 form part of these financial statements.

Page 19
 

 
ROVOP HOLDINGS LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

1.


General information

The Company is a private company limited by shares and is incorporated in the UK. The address of the registered office is Silvertrees Drive, Westhill, Aberdeen, AB32 6BH. The principal activity of the Company is to act as a holding company for the Group. The principal activity of the Group is the provision of remotely operated vehicle (ROV) services to the oil & gas and offshore wind industries.

2.


Going concern

The financial statements are prepared on a going concern basis, which assumes that the Group and Company will continue to meet its liabilities as they fall due.

The Group generated strong cash flows during the year and has continued to do so during the early months of the new financial year. Projections show the financial position continuing to improve with record levels of utilisation of the Group’s ROVs and associated crews. Industry projections show this demand increasing for the foreseeable future. This will ensure there continues to be sufficient working capital for the Group to meet its financial obligations.

As a result of the above considerations, the directors have continued to adopt the going concern basis of accounting in preparing the annual financial statements.

3.Accounting policies

 
3.1

Basis of preparation of financial statements

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

The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires Group management to exercise judgement in applying the Group's accounting policies (see note 4).

The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of comprehensive income in these financial statements. The profit/(loss) for the year is disclosed on the Company balance sheet..

The following principal accounting policies have been applied:

 
3.2

Basis of consolidation

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

Page 20
 

 
ROVOP HOLDINGS LIMITED
 

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

3.Accounting policies (continued)

 
3.3

Foreign currency translation

Functional and presentation currency

The Company's functional and presentational currency is GBP.

Transactions and balances

Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.

At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.

Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss except when deferred in other comprehensive income as qualifying cash flow hedges.

Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the Consolidated statement of comprehensive income within 'finance income or costs'. All other foreign exchange gains and losses are presented in profit or loss within 'other operating income'.

 
3.4

Revenue

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

Rendering of services

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

 
3.5

Operating leases: the Group as lessee

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

Page 21
 

 
ROVOP HOLDINGS LIMITED
 

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

3.Accounting policies (continued)

 
3.6

Leased assets: the Group as lessee

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

 
3.7

Government grants

Grants are accounted under the accruals model as permitted by FRS 102. Grants relating to expenditure on tangible fixed assets are credited to profit or loss at the same rate as the depreciation on the assets to which the grant relates. The deferred element of grants is included in creditors as deferred income.
Grants of a revenue nature are recognised in the Consolidated statement of comprehensive income in the same period as the related expenditure.

 
3.8

Interest income

Interest income is recognised in profit or loss using the effective interest method.

 
3.9

Finance costs

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

 
3.10

Borrowing costs

All borrowing costs are recognised in profit or loss in the year in which they are incurred.

  
3.11

Corresponding amounts

In accordance with FRS 28 (Corresponding amounts), the comparative figures in the profit and loss account have been re-classified to show the results on a comparable basis with the current year. 

 
3.12

Pensions

Defined contribution pension plan

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

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

Page 22
 

 
ROVOP HOLDINGS LIMITED
 

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

3.Accounting policies (continued)

  
3.13

Provisions for liabilities

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

 
3.14

Current and deferred tax

Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.

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

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

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

 
3.15

Exceptional items

Exceptional items are transactions that fall within the ordinary activities of the Group but are presented separately due to their size or incidence.

 
3.16

Intangible assets

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

Page 23
 

 
ROVOP HOLDINGS LIMITED
 

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

3.Accounting policies (continued)

 
3.17

Tangible fixed assets

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

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

Depreciation is provided on the following basis:

Tenants improvements
-
3 - 15 years straight line
Plant and machinery
-
3 - 12 years straight line
Motor vehicles
-
5 years straight line
Fixtures and fittings
-
3 - 10 years straight line
Computer equipment
-
3 years straight line

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

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

 
3.18

Valuation of investments

Investments in subsidiaries are measured at cost less accumulated impairment.

 
3.19

Stocks

Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis. Work in progress and finished goods include labour and attributable overheads.

At each balance sheet date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in profit or loss.

 
3.20

Debtors

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

 
3.21

Cash and cash equivalents

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

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

Page 24
 

 
ROVOP HOLDINGS LIMITED
 

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

3.Accounting policies (continued)

 
3.22

Creditors

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

 
3.23

Financial instruments

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

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

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

Basic financial assets

Basic financial assets, which include trade and other receivables, cash and bank balances, are initially measured at their transaction price including transaction costs and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, 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.

Discounting is omitted where the effect of discounting is immaterial. The Group's cash and cash equivalents, trade and most other receivables due with the operating cycle fall into this category of financial instruments.

Other financial assets

Other financial assets, which includes investments in equity instruments which are not classified as subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the recognised transaction price. Such assets are subsequently measured at fair value with the changes in fair value being recognised in the profit or loss. Where other financial assets are not publicly traded, hence their fair value cannot be measured reliably, they are measured at cost less impairment.

Impairment of financial assets

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

Financial assets are impaired when events, subsequent to their initial recognition, indicate the estimated future cash flows derived from the financial asset(s) have been adversely impacted. The impairment loss will be the difference between the current carrying amount and the present value of the future cash flows at the asset(s) original effective interest rate.

If there is a favourable change in relation to the events surrounding the impairment loss then the impairment can be reviewed for possible reversal. The reversal will not cause the current carrying amount to exceed the original carrying amount had the impairment not been recognised. The impairment reversal is recognised in the profit or loss.

Financial liabilities

Financial liabilities and equity instruments are classified according to the substance of the contractual
Page 25
 

 
ROVOP HOLDINGS LIMITED
 

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

3.Accounting policies (continued)


3.23
Financial instruments (continued)

arrangements entered into. An equity instruments any contract that evidences a residual interest in the assets of the Group after the deduction of all its liabilities.

Basic financial liabilities, which include trade and other payables, bank loans, other loans and loans due to fellow group companies are initially measured at their transaction price after transaction costs. When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest. Discounting is omitted where the effect of discounting is immaterial.

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

Trade payables are obligations to pay for goods and services that have been acquired in the ordinary course of business from suppliers. Trade payables are classified as current liabilities if the payment is due within one year. If not, they represent non-current liabilities. Trade payables are initially recognised at their transaction price and subsequently are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial.

Other financial instruments

Derivatives, including forward exchange contracts, futures contracts and interest rate swaps, are not classified as basic financial instruments. These are initially recognised at fair value on the date the derivative contract is entered into, with costs being charged to the profit or loss. They are subsequently measured at fair value with changes in the profit or loss.

Debt instruments that do not meet the conditions as set out in FRS 102 paragraph 11.9 are subsequently measured at fair value through the profit or loss. This recognition and measurement would also apply to financial instruments where the performance is evaluated on a fair value basis as with a documented risk management or investment strategy.

Derecognition of financial instruments

Derecognition of financial assets

Financial assets are derecognised when their contractual right to future cash flow expire, or are settled, or when the Group transfers the asset and substantially all the risks and rewards of ownership to another party. If significant risks and rewards of ownership are retained after the transfer to another party, then the Group will continue to recognise the value of the portion of the risks and rewards retained.

Derecognition of financial liabilities

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

Page 26
 

 
ROVOP HOLDINGS LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

4.


Judgements in applying accounting policies and key sources of estimation uncertainty

The preparation of financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported for assets and liabilities as at the Balance sheet date and the amounts reported during the year for revenue and costs. However the nature of estimation means that actual outcomes could differ from those estimates. Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.  
Useful economic lives of tangible fixed assets
The annual depreciation charge for tangible fixed assets is sensitive to changes in the useful economic lives and residual values of the assets. Useful lives and residual values are reassessed annually. They are assessed where necessary to reflect current estimates based on economic utilisation and physical condition.
Impairment of debtors
The Group makes an assessment of the recoverable value of trade and other debtors. When assessing impairment of trade and other debtors, management consider various factors including the ageing profile of debtors and historical experience. On this basis, certain overdue balance have been fully provided for. The trade debtors figure in Note 16 is shown net of this provision.
Tax
Management estimation is required to determine the amount of deferred tax assets that can be recognised, based upon likely timing and level of future taxable profits together with an assessment of the effect of future tax planning strategies. As disclosed at Note 11 the deferred tax asset has not been recognised.


5.


Turnover

The whole of the turnover is attributable to the provision of remotely operated vehicle (ROV) services.

Analysis of turnover by country of destination:

2023
2022
£
£

United Kingdom
13,174,193
7,936,417

Rest of Europe
1,646,651
3,657,505

Rest of the world
38,173,119
28,753,542

52,993,963
40,347,464



6.


Other operating income

2023
2022
£
£

Government grants receivable
-
13,457

-
13,457


Page 27
 

 
ROVOP HOLDINGS LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

7.


Auditor's remuneration

During the year, the Group obtained the following services from the Company's auditor and its associates:


2023
2022
£
£



Fees payable to the Company's auditor and its associates for the audit of the consolidated and parent Company's financial statements
60,000
53,750


8.


Employees

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


Group
Group
2023
2022
£
£


Wages and salaries
20,644,030
19,347,305

Wages and salaries cost associated with exceptional item
1,572,161
-

Social security costs
1,600,420
1,445,122

Cost of defined contribution pension scheme
238,916
285,686

24,055,527
21,078,113


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


        2023
        2022
            No.
            No.







Administration
39
35



Operations
219
185



Management
8
8

266
228

Page 28
 

 
ROVOP HOLDINGS LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

9.


Directors' remuneration

2023
2022
£
£

Directors' emoluments
1,392,060
341,250

Group contributions to defined contribution pension schemes
16,551
36,375

1,408,611
377,625


The highest paid director received remuneration of £941,436 (2022 - £200,629).

The value of the Group's contributions paid to a defined contribution pension scheme in respect of the highest paid director amounted to £10,343 (2022 - £30,000).


10.


Interest payable and similar expenses

2023
2022
£
£


Bank interest payable
-
5,427

Other loan interest payable
5,755,968
6,432,685

Other interest payable
466,861
221,795

6,222,829
6,659,907

Included within other loan interest payable is £5,755,968 (2022 - £6,432,685) of interest payable on loan notes which have had no cash payments and the interest is rolled-up and accrued in the loan note creditor as disclosed at Note 21. The rolled up interest is not scheduled for payment until December 2024.


11.


Tax


2023
2022
£
£


Foreign tax


Foreign tax on income for the year
1,082,310
409,159

Foreign tax in respect of prior periods
443,492
-

Total current tax
1,525,802
409,159

Deferred tax


Origination and reversal of timing differences
-
(194,607)

Total deferred tax
-
(194,607)


Taxation on profit on ordinary activities
1,525,802
214,552
Page 29
 

 
ROVOP HOLDINGS LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
 
11.Tax (continued)


Factors affecting tax charge for the year

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

2023
2022
£
£


Profit/(loss) on ordinary activities before tax
4,960,287
(6,344,276)


Profit/(loss) on ordinary activities multiplied by standard rate of corporation tax in the UK of 19% (2022 - 19%)
942,455
(1,205,412)

Effects of:


Expenses not deductible for tax purposes
7,636
346

Impact of overseas subsidiary losses
649,052
841,160

Fixed asset differences
8,925
7,914

Deferred tax asset not recognised
(1,325,007)
260,888

Non-taxable income
-
(21,763)

Other permanent differences
(283,061)
(77,740)

Foreign tax
1,525,802
409,159

Total tax charge for the year
1,525,802
214,552


Factors that may affect future tax charges

The Group has a deferred tax asset in its UK companies of £4,394,028 (2022 restated - £5,719,035) which has not been recognised due to the uncertainty around the timing of its reversal.
The most recent Finance Act announced an increase to the main rate of corporation tax to 25% from April 2023. This increase in rate will have an impact on future tax charges. The deferred tax charge has been calculated based on the rate of 25%.

Page 30
 

 
ROVOP HOLDINGS LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

12.


Exceptional items

2023
2022
£
£
Exceptional costs relating to staff costs

1,572,161

-

Exceptional gain on settlement of loans

(9,118,674)

-

Exceptional costs relating to professional fees

1,343,611

(3,391)

Other exceptional costs

127,924

-

(6,074,978)

(3,391)


Exceptional staff costs include long-term performance related payments due under agreed schemes.  The exceptional professional fees relate to the settlement of shareholder loans and the new external funding put in place during the year. 


13.


Tangible fixed assets

Group






Tenants improvements
ROV equipment
Computer equipment & motor vehicles
Assets under construction
Total

£
£
£
£
£



Cost or valuation


At 1 April 2022
965,466
66,005,858
1,033,563
6,525
68,011,412


Additions
70,889
2,920,360
91,213
-
3,082,462


Disposals
-
-
-
(2,934)
(2,934)


Exchange adjustments
12,110
(6,742)
6,245
-
11,613



At 31 March 2023

1,048,465
68,919,476
1,131,021
3,591
71,102,553



Depreciation


At 1 April 2022
577,501
29,803,917
799,466
-
31,180,884


Charge for the year on owned assets
75,954
7,270,070
144,016
-
7,490,040



At 31 March 2023

653,455
37,073,987
943,482
-
38,670,924



Net book value



At 31 March 2023
395,010
31,845,489
187,539
3,591
32,431,629



At 31 March 2022
387,965
36,201,941
234,097
6,525
36,830,528

Page 31
 

 
ROVOP HOLDINGS LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

14.


Fixed asset investments

Company





Investments in subsidiary companies

£



Cost or valuation


At 1 April 2022
30,211,063



At 31 March 2023
30,211,063






Net book value



At 31 March 2023
30,211,063



At 31 March 2022
30,211,063

ROVOP BV was liquidated during the period and no longer forms part of the group structure. 

Page 32
 

 
ROVOP HOLDINGS LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

Subsidiary undertakings


The following were subsidiary undertakings of the Company:

Name

Registered office

Class of shares

Holding

ROVOP Midco Limited
Silvertress Drive, Westhill, Aberdeen, AB32 6BH
Ordinary
100%
ROVOP Group Limited*
Silvertrees Drive, Westhill, Aberdeen, AB32 6BH
Ordinary
100%
ROVOP Limited**
Silvertrees Drive, Westhill, Aberdeen, AB32 6BH
Ordinary
100%
ROVOP Assets Limited**
Suite 1, 3rd Floor 11-12 St. James's Square, London, United Kingdom, SW1Y 4LB
Ordinary
100%
ROVOP Inc**
13719 FM 529, Houston, Texas 77041, United States of America
Ordinary
100%
ROVOP Assets 2 Limited**
Suite 1, 3rd Floor 11-12 St. James's Square, London, United Kingdom, SW1Y 4LB
Ordinary
100%
ROVOP Assets 3 Limited**
Suite 1, 3rd Floor 11-12 St. James's Square, London, United Kingdom, SW1Y 4LB
Ordinary
100%
ROVOP Assets 4 Limited**
Suite 1, 3rd Floor 11-12 St. James's Square, London, United Kingdom, SW1Y 4LB
Ordinary
100%
ROVOP Middle East DMCC**
Office 204, Jumeirah Business Centre 1, Cluster G, JLT, Dubai, United Arab Emirates
Ordinary
100%
ROVOP (Trinidad and Tobago) Ltd****
122-124 Frederick Street, Port of Spain, Trinidad and Tobago
Ordinary
100%
ROVOP Mexico SA*****
180 Bosque de Circuelos, 11700, Mexico
Ordinary
100%

* held 100% by ROVOP Midco Limited.
** held 100% by ROVOP Group Limited.
*** held 100% by ROVOP Limited.
**** held 100% by ROVOP Inc.
***** held 99% by ROVOP Inc and 1% by ROVOP Group Limited.

Page 33
 

 
ROVOP HOLDINGS LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

15.


Stocks

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

Spares and consumables
197,002
104,422
-
-

197,002
104,422
-
-



16.


Debtors



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


Trade debtors
10,760,651
10,164,910
-
-

Other debtors
2,912,619
1,697,932
1,000
-

Prepayments and accrued income
4,165,250
4,589,003
-
-

Tax recoverable
-
7,419
-
-

17,838,520
16,459,264
1,000
-



17.


Cash and cash equivalents

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

Cash at bank and in hand
9,458,682
3,595,872
140
170

9,458,682
3,595,872
140
170


Page 34
 

 
ROVOP HOLDINGS LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

18.


Creditors: Amounts falling due within one year

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

Trade creditors
3,218,236
1,930,239
-
-

Amounts owed to group undertakings
-
-
904,235
817,035

Corporation tax
7,006
-
-
-

Other tax and social security
1,477,581
718,503
-
-

Working capital facility
2,045,152
1,777,148
-
-

Other creditors
133,295
281,516
-
-

Accruals and deferred income
3,085,263
2,890,432
-
7,000

9,966,533
7,597,838
904,235
824,035


The working capital facility is secured over the trade debtors of ROVOP Limited.


19.


Creditors: Amounts falling due after more than one year

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

Other loans (Note 21)
20,430,000
-
-
-

20,430,000
-
-
-


Other loans relate to a new loan entered into during the year with a balance of £20,430,000 (2022: £nil) due to a third party. The loan is repayable in full on its maturity date in February 2027 or when certain criteria are met in relation to available cash. It therefore falls due between 2-5 years. Interest is applied at 6.8% above the relevant base rate.



Page 35
 

 
ROVOP HOLDINGS LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

20.


Shareholder loans

Group
2023
Group
2022
£
£


Shareholder loans (Note 21)
39,913,819
63,477,983

39,913,819
63,477,983


Shareholder loans in the prior year comprised four loan note instruments, including rolled-up interest and redemption premium amounting £63,880,127. The balance above is shown net of debt issue costs of £402,144. During the current year an agreement was reached with a lender for two of these loans to be settled. At the year-end the balance due on the remaining two loan note instruments is £40,167,935 with the balance above shown net of debt issue costs of £254,116. The first loan note of £1,500,000, together with accrued interest of £1,057,810 is due for repayment in December 2027 and accrues interest at 20% per annum. The balance represents a loan note, including redemption premium and accrued interest, which is due for repayment in December 2024 and accrues interest at 10% per annum. The loans are secured over certain assets of the Group.


21.


Loans


Analysis of the maturity of loans is given below:


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

Amounts falling due 1-2 years

Shareholder loans
37,356,009
-
-
-

Amounts falling due 2-5 years

Other loans
20,430,000
-
-
-

Shareholder loans
-
59,269,347
-
-

Amounts falling due after more than 5 years

Shareholder loans
2,557,810
4,208,636
-
-

60,343,819
63,477,983
-
-


Page 36
 

 
ROVOP HOLDINGS LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

22.


Financial instruments

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

Financial assets

Financial assets measured at fair value through profit or loss
9,458,682
3,595,872
140
170

Financial assets that are debt instruments measured at amortised cost
16,638,202
16,157,780
-
-

26,096,884
19,753,652
140
170


Financial liabilities

Financial liabilities measured at amortised cost
(68,825,765)
(69,976,537)
(904,235)
(824,035)


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


Financial assets that are debt instruments measured at amortised cost comprise trade and other debtors and accrued income. 


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

Page 37
 

 
ROVOP HOLDINGS LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

23.


Deferred tax


Group



2022


£






At beginning of year
(194,607)


Charged to profit or loss
194,607



At end of period
-


24.


Share capital

2023
2022
£
£
Allotted, called up and fully paid



25,057,998 (2022 - 25,057,998) A Ordinary shares of £0.01 each
250,580
250,580
7,927 (2022 - 7,927) B Ordinary shares of £0.05 each
396
396
2,129 (2022 - 2,129) C Ordinary shares of £0.05 each
107
107
7,000 (2022 - 7,000) D Deferred shares of £0.01 each
70
70

251,153

251,153

A Ordinary shares permit the holders to vote in any general meeting of the Company. The shareholders have the right to receive a dividend in priority to all other shareholders but do not have any right to a fixed dividend. In the event of a winding up, holders of A Ordinary shares are entitled to be paid first however they do not confer any rights of redemption.
B Ordinary shares permit the holders to vote in any general meeting of the Company and the right to receive a dividend.
C Ordinary shares do not permit the holders to vote in any general meeting of the Company but do carry the right to receive a dividend.
D Deferred shares permit the holders to vote in any general meeting of the Company but are not entitled to dividends or other distributions from the Company.



25.


Pension commitments

The Group contributes to a defined contribution pension scheme. The assets of the scheme are held separately from those of the Group in an independently administered fund. The pension cost charge represents contributions payable by the Group to the fund and amounted to £238,916 (2022: £285,686). Contributions totalling £70,317 (2022: £75,162) were payable to the fund at the balance sheet date and are included in creditors. 

Page 38
 

 
ROVOP HOLDINGS LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

26.


Commitments under operating leases

At 31 March 2023 the Group and the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:


Group
Group
2023
2022
£
£


Not later than 1 year
389,247
459,088

Later than 1 year and not later than 5 years
1,248,000
1,321,544

Later than 5 years
2,132,000
2,444,000

3,769,247
4,224,632

27.


Related party transactions

The Company and the Group have taken advantage of the exemptions conferred by Financial Reporting Standard 102 Section 33.1A 'Related Party Disclosures' which allow exemption from the disclosure of related party transactions with other group companies. 
The Group incurred interest of £5,755,968 (2022: £6,432,685) and repaid capital and interest of £23,661,289 (2022: £nil) on loans from the shareholders. The capital repayment included the settlement of loans at a reduced amount resulting in an exceptional gain being reported in the profit and loss account of £9,118,674 (2022: £nil). As part of this refinancing, another shareholder introduced additional loan funding of £3,459,931. The balance outstanding at the balance sheet date on these loans, including accrued interest and redemption premium, was £40,167,935 (2022: £63,880,127).
During the year the Group incurred administrative expenses of £401,303 (2022: £62,000) from a company with a common director.  


28.


Controlling party

The ultimate parent company is ROVOP Guernsey Limited, a company incorporated in Guernsey with its registered office at PO Box 656, East Wing, Trafalgar Court, Les Banques, St Peter Port, Guernsey, GY1 3PP.
The directors believe that there is no ultimate controlling party. 

Page 39