REGISTERED NUMBER: 01305567 (England and Wales) |
Group Strategic Report, Report of the Directors and |
Consolidated Financial Statements |
for the Year Ended 30 September 2022 |
for |
Shepperton Group Limited |
REGISTERED NUMBER: 01305567 (England and Wales) |
Group Strategic Report, Report of the Directors and |
Consolidated Financial Statements |
for the Year Ended 30 September 2022 |
for |
Shepperton Group Limited |
Shepperton Group Limited (Registered number: 01305567) |
Contents of the Consolidated Financial Statements |
for the Year Ended 30 September 2022 |
Page |
Company Information | 1 |
Group Strategic Report | 2 |
Report of the Directors | 3 |
Report of the Independent Auditors | 4 |
Consolidated Income Statement | 7 |
Consolidated Balance Sheet | 8 |
Company Balance Sheet | 9 |
Consolidated Statement of Changes in Equity | 10 |
Company Statement of Changes in Equity | 11 |
Consolidated Cash Flow Statement | 12 |
Notes to the Consolidated Cash Flow Statement | 13 |
Notes to the Consolidated Financial Statements | 14 |
Shepperton Group Limited |
Company Information |
for the Year Ended 30 September 2022 |
DIRECTORS: |
SECRETARY: |
REGISTERED OFFICE: |
REGISTERED NUMBER: |
Shepperton Group Limited (Registered number: 01305567) |
Group Strategic Report |
for the Year Ended 30 September 2022 |
The directors present their strategic report of the company and the group for the year ended 30 September 2022. |
PRINCIPAL ACTIVITY |
The principal activity of Shepperton Group Limited is that of a holding company of a trading group, whose subsidiaries' activities are builders, public works contractors and property maintenance. |
REVIEW OF BUSINESS AND FUTURE DEVELOPMENTS |
The financial year was dominated by the continued effects of the COVID-19 pandemic, with significant price inflation and supply chain issues; during the period an exceptionally high number of corporate failures in the supply chain caused very material delivery issues. Correspondingly the results were significantly reduced turnover overall, as well as several key contracts on fixed prices being impacted and incurring losses. |
Despite the challenges, the group continues to benefit from its solid financial base. |
Looking forward, the construction business has a strong order book, with a return to profit expected in the medium to long term. The development businesses have been investing in stock during this period, with sales generating cash and margin during the next financial year. |
PRINCIPAL RISKS AND UNCERTAINTIES |
The principal risks and uncertainties arise from the continued inflationary price pressure experienced in the market, which present both a risk to the company's ability to source materials and labour at estimated price, as well as the customer base reviewing project viability. The company also continues to monitor and stand by to react to further pandemic disruptions. |
KEY PERFORMANCE INDICATORS |
The board uses a number of tools to monitor the Group's performance on a divisional basis, including a review of key performance indicators (KPIs) on a regular and consistent basis across the Group. Examples of the KPIs currently used for the group include: |
Financial key performance indicators |
2022 | 2021 |
Return on capital employed | -30.0% | 2.3% |
Gross margin | 0.2% | 6.7% |
Cash at bank | 4,207,757 | 7,332,736 |
Net profit margin | -8.6% | 0.7% |
Current ratio | 1.50 | 1.61 |
Non-financial key performance indicators |
2022 | 2021 |
Accident / incident rate (AIR) | 0.00 | 0.30 |
FINANCIAL RISK MANAGEMENT |
Despite the difficult market conditions generally, the company remains well placed to take advantage of market opportunities, and remains positive on its financial position. Medium to long term forecasts are positive in both profitability and cash generation terms. |
MARKET RISK |
Rising prices, along with reduction in demand for some sectors of the company's customer base may affect the company's ability to secure further work. The Company continues to monitor this and plans to mitigate against this risk by maintaining a well-diversified portfolio of work. Likewise, the Company maintains a broad supplier base to mitigate against supply side risk. |
ON BEHALF OF THE BOARD: |
Shepperton Group Limited (Registered number: 01305567) |
Report of the Directors |
for the Year Ended 30 September 2022 |
The directors present their report with the financial statements of the company and the group for the year ended 30 September 2022. |
DIVIDENDS |
No dividends will be distributed for the year ended 30 September 2022. |
DIRECTORS |
The directors shown below have held office during the whole of the period from 1 October 2021 to the date of this report. |
Other changes in directors holding office are as follows: |
STATEMENT OF DIRECTORS' RESPONSIBILITIES |
The directors are responsible for preparing the Group Strategic Report, the Report of the Directors 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 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 and then apply them consistently; |
- | make judgements and accounting estimates that are reasonable and prudent; |
- | prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business. |
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's and the group's transactions and disclose with reasonable accuracy at any time the financial position of the company and the group 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 company and the group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. |
STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS |
So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the group's auditors are unaware, and each director has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the group's auditors are aware of that information. |
AUDITORS |
The auditors, Sumer Audit, will be proposed for re-appointment at the forthcoming Annual General Meeting. |
ON BEHALF OF THE BOARD: |
Report of the Independent Auditors to the Members of |
Shepperton Group Limited |
Opinion |
We have audited the financial statements of Shepperton Group Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 30 September 2022 which comprise the Consolidated Income Statement, Consolidated Other Comprehensive Income, Consolidated Balance Sheet, Company Balance Sheet, Consolidated Statement of Changes in Equity, Company Statement of Changes in Equity, Consolidated Cash Flow Statement and Notes to the Consolidated Cash Flow Statement, Notes to the Financial Statements, including a summary of 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: |
- | give a true and fair view of the state of the group's and of the parent company affairs as at 30 September 2022 and of the group's loss for the year then ended; |
- | have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and |
- | have been prepared in accordance with the requirements of the Companies Act 2006. |
Basis for opinion |
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the 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 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. |
Other information |
The directors are responsible for the other information. The other information comprises the information in the Group Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon. |
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. |
In connection with our audit of the financial statements, 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 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 the audit: |
- | the information given in the Group Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
- | the Group Strategic Report and the Report of the Directors 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 Report of the Directors. |
We have nothing to report in respect of the following matters where 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. |
Report of the Independent Auditors to the Members of |
Shepperton Group Limited |
Responsibilities of directors |
As explained more fully in the Statement of Directors' Responsibilities set out on page three, 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 necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. |
In preparing the financial statements, the directors are responsible for assessing the group's and the parent company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the group or the parent company or to cease operations, or have no realistic alternative but to do so. |
Auditors' responsibilities for the audit of the financial statements |
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue a Report of the Auditors that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. |
The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below: |
Based on our understanding of the Group we identified that the principal risks of non-compliance with laws and regulations related to health and safety, anti-bribery, employment law and company legislation, and we considered the extent to which non-compliance might have a material effect on the financial statements of the Group. We also considered those laws and regulations that have a direct impact on the preparation of the financial statements such as the Companies Act 2006 and taxation legislation. We evaluated management’s incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls), and determined that the principal risks were related to posting inappropriate journal entries to increase revenue or reduce expenditure, and management bias in accounting estimates and judgemental areas of the financial statements. Audit procedures performed by the audit engagement team included: |
- Discussions with management, including consideration of known or suspected instances of non-compliance with laws and regulations and fraud; |
- Understanding of management’s internal controls designed to prevent and detect irregularities, and fraud; |
- Reviewing the Group’s legal costs to check for non-compliance with laws and regulations and fraud; |
- Reviewing Board of Directors minutes; |
- Review of tax compliance with the involvement of our tax specialists in the audit; |
- Designing audit procedures to incorporate unpredictability around the nature, timing or extent of our testing of |
expenses and work-in-progress; |
- Testing any transactions entered into outside of the normal course of the Group’s business; |
- Identifying and testing journal entries, in particular any journal entries with fraud characteristics such as journals with |
round numbers. |
There are inherent limitations in the audit procedures described above and the further removed non-compliance with |
laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion. |
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 Report of the Auditors. |
Report of the Independent Auditors to the Members of |
Shepperton Group Limited |
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 a Report of the Auditors 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. |
for and on behalf of |
Statutory Auditors |
Hermes House |
Fire Fly Avenue |
Swindon |
Wiltshire |
SN2 2GA |
Shepperton Group Limited (Registered number: 01305567) |
Consolidated |
Income Statement |
for the Year Ended 30 September 2022 |
2022 | 2021 |
Notes | £ | £ |
TURNOVER | 4 | 28,180,850 | 44,640,654 |
Cost of sales | 28,119,098 | 41,639,778 |
GROSS PROFIT | 61,752 | 3,000,876 |
Administrative expenses | 2,534,723 | 2,710,078 |
(2,472,971 | ) | 290,798 |
Other operating income | 97,202 | 81,621 |
OPERATING (LOSS)/PROFIT | 7 | (2,375,769 | ) | 372,419 |
Interest receivable and similar income | - | 1,273 |
(2,375,769 | ) | 373,692 |
Interest payable and similar expenses | 8 | 19,200 | 14,043 |
(LOSS)/PROFIT BEFORE TAXATION | (2,394,969 | ) | 359,649 |
Tax on (loss)/profit | 9 | 32,269 | 67,393 |
(LOSS)/PROFIT FOR THE FINANCIAL YEAR | ( |
) |
Shepperton Group Limited (Registered number: 01305567) |
Consolidated Balance Sheet |
30 September 2022 |
2022 | 2021 |
Notes | £ | £ | £ | £ |
FIXED ASSETS |
Tangible assets | 12 | 1,599,172 | 1,640,438 |
Investments | 13 | - | - |
1,599,172 | 1,640,438 |
CURRENT ASSETS |
Stocks | 14 | 5,810,587 | 4,386,739 |
Debtors | 15 | 9,097,900 | 10,722,269 |
Cash at bank | 4,207,757 | 7,332,736 |
19,116,244 | 22,441,744 |
CREDITORS |
Amounts falling due within one year | 16 | 12,803,798 | 14,018,154 |
NET CURRENT ASSETS | 6,312,446 | 8,423,590 |
TOTAL ASSETS LESS CURRENT LIABILITIES |
7,911,618 |
10,064,028 |
CREDITORS |
Amounts falling due after more than one year |
17 |
1,472,974 |
1,198,146 |
NET ASSETS | 6,438,644 | 8,865,882 |
CAPITAL AND RESERVES |
Called up share capital | 21 | 2,020 | 2,020 |
Other reserves | 22 | 93,267 | 93,267 |
Retained earnings | 22 | 6,343,357 | 8,770,595 |
SHAREHOLDERS' FUNDS | 6,438,644 | 8,865,882 |
The financial statements were approved by the Board of Directors and authorised for issue on 10 November 2023 and were signed on its behalf by: |
G K Davis - Director |
Shepperton Group Limited (Registered number: 01305567) |
Company Balance Sheet |
30 September 2022 |
2022 | 2021 |
Notes | £ | £ | £ | £ |
FIXED ASSETS |
Tangible assets | 12 | 404,103 | 414,441 |
Investments | 13 |
CURRENT ASSETS |
Debtors | 15 |
Cash at bank |
CREDITORS |
Amounts falling due within one year | 16 |
NET CURRENT ASSETS |
TOTAL ASSETS LESS CURRENT LIABILITIES |
CREDITORS |
Amounts falling due after more than one year |
17 |
NET ASSETS |
CAPITAL AND RESERVES |
Called up share capital | 21 | 2,020 | 2,020 |
Retained earnings |
SHAREHOLDERS' FUNDS |
Company's profit for the financial year | 1,389 | 288,941 |
The financial statements were approved by the Board of Directors and authorised for issue on |
Shepperton Group Limited (Registered number: 01305567) |
Consolidated Statement of Changes in Equity |
for the Year Ended 30 September 2022 |
Called up |
share | Retained | Other | Total |
capital | earnings | reserves | equity |
£ | £ | £ | £ |
Balance at 1 October 2020 | 2,020 | 8,528,339 | 93,267 | 8,623,626 |
Changes in equity |
Dividends | - | (50,000 | ) | - | (50,000 | ) |
Total comprehensive income | - | 292,256 | - | 292,256 |
Balance at 30 September 2021 | 2,020 | 8,770,595 | 93,267 | 8,865,882 |
Changes in equity |
Total comprehensive income | - | (2,427,238 | ) | - | (2,427,238 | ) |
Balance at 30 September 2022 | 2,020 | 6,343,357 | 93,267 | 6,438,644 |
Shepperton Group Limited (Registered number: 01305567) |
Company Statement of Changes in Equity |
for the Year Ended 30 September 2022 |
Called up |
share | Retained | Total |
capital | earnings | equity |
£ | £ | £ |
Balance at 1 October 2020 | 2,020 | 3,021,842 | 3,023,862 |
Changes in equity |
Dividends | - | ( |
) | ( |
) |
Total comprehensive income | - |
Balance at 30 September 2021 | 2,020 | 3,260,783 | 3,262,803 |
Changes in equity |
Total comprehensive income | - |
Balance at 30 September 2022 | 2,020 | 3,262,172 | 3,264,192 |
Shepperton Group Limited (Registered number: 01305567) |
Consolidated Cash Flow Statement |
for the Year Ended 30 September 2022 |
2022 | 2021 |
Notes | £ | £ |
Cash flows from operating activities |
Cash generated from operations | 1 | (4,533,827 | ) | 903,587 |
Interest paid | (19,200 | ) | (14,043 | ) |
Tax paid | (42,143 | ) | (1,278 | ) |
Net cash from operating activities | (4,595,170 | ) | 888,266 |
Cash flows from investing activities |
Purchase of tangible fixed assets | (35,608 | ) | (47,609 | ) |
Interest received | - | 1,273 |
Net cash from investing activities | (35,608 | ) | (46,336 | ) |
Cash flows from financing activities |
New loans in year | - | 314,482 |
Loan repayments in year | (603,199 | ) | (2,365,409 | ) |
Drawdowns on existing loans | 2,108,998 | 372,422 |
Equity dividends paid | - | (50,000 | ) |
Net cash from financing activities | 1,505,799 | (1,728,505 | ) |
Decrease in cash and cash equivalents | (3,124,979 | ) | (886,575 | ) |
Cash and cash equivalents at beginning of year |
2 |
7,332,736 |
8,219,311 |
Cash and cash equivalents at end of year | 2 | 4,207,757 | 7,332,736 |
Shepperton Group Limited (Registered number: 01305567) |
Notes to the Consolidated Cash Flow Statement |
for the Year Ended 30 September 2022 |
1. | RECONCILIATION OF (LOSS)/PROFIT FOR THE FINANCIAL YEAR TO CASH GENERATED FROM OPERATIONS |
2022 | 2021 |
£ | £ |
(Loss)/profit for the financial year | (2,427,238 | ) | 292,256 |
Depreciation charges | 76,876 | 89,011 |
Loss on disposal of fixed assets | - | 1,302 |
Finance costs | 19,200 | 14,043 |
Finance income | - | (1,273 | ) |
Taxation | 32,269 | 67,393 |
(2,298,893 | ) | 462,732 |
(Increase)/decrease in stocks | (1,423,848 | ) | 1,017,998 |
Decrease in trade and other debtors | 1,624,369 | 978,353 |
Decrease in trade and other creditors | (2,435,455 | ) | (1,555,496 | ) |
Cash generated from operations | (4,533,827 | ) | 903,587 |
2. | CASH AND CASH EQUIVALENTS |
The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts: |
Year ended 30 September 2022 |
30.9.22 | 1.10.21 |
£ | £ |
Cash and cash equivalents | 4,207,757 | 7,332,736 |
Year ended 30 September 2021 |
30.9.21 | 1.10.20 |
£ | £ |
Cash and cash equivalents | 7,332,736 | 8,219,311 |
3. | ANALYSIS OF CHANGES IN NET FUNDS |
At 1.10.21 | Cash flow | At 30.9.22 |
£ | £ | £ |
Net cash |
Cash at bank | 7,332,736 | (3,124,979 | ) | 4,207,757 |
7,332,736 | (3,124,979 | ) | 4,207,757 |
Debt |
Debts falling due within 1 year | (360,716 | ) | (1,542,370 | ) | (1,903,086 | ) |
Debts falling due after 1 year | (413,269 | ) | 36,570 | (376,699 | ) |
(773,985 | ) | (1,505,800 | ) | (2,279,785 | ) |
Total | 6,558,751 | (4,630,779 | ) | 1,927,972 |
Shepperton Group Limited (Registered number: 01305567) |
Notes to the Consolidated Financial Statements |
for the Year Ended 30 September 2022 |
1. | STATUTORY INFORMATION |
Shepperton Group Limited is a |
2. | ACCOUNTING POLICIES |
Basis of preparing the financial statements |
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires Group management to exercise judgment in applying the Group's accounting policies (see note 3). |
The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and hs not presented its own Statement of comprehensive income in these financial statements. |
The following principal accounting policies have been applied: |
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. The are deconsolidated from the date control ceases. |
Going concern |
Having examined funding levels and prepared worst case scenario cash flow projections, the Directors feel confident that the Company has adequate resources to continue in operational existence of the foreseeable future, being a period of at least 12 months from the signing of the financial statements. We therefore consider that use of the going concern basis is appropriate. |
Turnover |
Turnover is recognised to the extent that it is probable that the economic benefits will flow to the Group and the turnover can be reliably measured. Turnover is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before turnover is recognised: |
Sales of land and property |
Turnover from the sale of land is recognised when all of the following conditions are satisfied: |
- the Group has transferred the significant risks and rewards of ownership to the buyer; |
- the Group retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold; |
- the amount of turnover can be measured reliably; |
- it is probably that the Group will receive the consideration due under the transaction; and |
- the costs incurred or to be incurred in respect of the transaction can be measured reliably. |
Construction contracts |
Turnover from construction contracts is recognised in accordance with the stage of completion of the contract when all of the following conditions are satisfied: |
- the amount of turnover can be measured reliably; |
- it is probable that the Group will receive the consideration due under the contract; |
- the stage of completion of the contract at the end of the reporting period can be measured reliably; |
and |
- the costs incurred and the costs to complete the contract can be measured reliably. |
Profit on long-term contracts is taken as the work is carried out if the final outcome can be assessed with reasonable certainty. The profit included is calculated on a prudent basis to reflect the proportion of the work carried out at the year-end, by recording turnover and related costs as contract activity progresses. Turnover is calculated as that proportion of total contract value which costs incurred to date bear to total expected costs from that contract. Revenue derived from variations on contracts are recognised only when they have been accepted by the customer. Full provision is made for losses on all contracts in the year in which they are first foreseen. |
Shepperton Group Limited (Registered number: 01305567) |
Notes to the Consolidated Financial Statements - continued |
for the Year Ended 30 September 2022 |
2. | ACCOUNTING POLICIES - continued |
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. |
At each reporting date the company assess whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined which is the higher of its fair value less costs to sell and its value in use. An impairment loss is recognised where the carrying amount exceeds the recoverable amount. |
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives. |
Depreciation is provided on the following basis: |
Freehold property | - 2% on cost |
Plant and machinery | - 12.5% and 25% reducing balance |
Motor vehicles | - 25% on cost |
Fixtures, fittings and office equipment | - 25% reducing balance |
Valuation of investments |
Investments in subsidiaries are measured at cost less accumulated impairment. |
Stocks |
Stocks and work-in-progress have been valued at the lower of cost and net realisable value. Net realisable value is based on the estimated selling price less any further costs expected to be incurred to completion. Stock includes valuations of all work performed by sub-contractors, whether certified or not, any capitalised interest, and all overheads other than those relating to the general administration of the business. |
Amounts recoverable on contracts which are included in debtors are stated at cost plus attributable profit to the extent that this is reasonably certain after making provision for contingencies, less any losses incurred or foreseen in bringing contracts to completion, and less amounts received as progress payments. Cost of this purpose includes valuations of all work performed by sub-contractors, whether certified or not, any capitalised interest, and all overheads other than those relating to the general administration of the business. |
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. |
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. |
Shepperton Group Limited (Registered number: 01305567) |
Notes to the Consolidated Financial Statements - continued |
for the Year Ended 30 September 2022 |
2. | ACCOUNTING POLICIES - continued |
Financial instruments |
The Group only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in ordinary shares. |
Debt instruments (other thank those wholly repayable or receivable within one year), including loans and other accounts receivable and payable, are initially measured at present value of the future cash flows and subsequently at amortised cost using the effective interest method. Debt instruments that are payable or receivable within one year, typically trade debtors and creditors, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received. However, if the arrangements of a short-term instrument constitute a financing transaction, like the payment of a trade debt deferred beyond normal business terms or in case of an out-right short-term loan that is not at market rate, the financial asset or liability is measured, initially at the present value of future cash flows discounted at a market rate of interest for a similar debt instrument and subsequently at amortised cost, unless it qualifies as a loan from a director in the case of a small company, or a public benefit entity concessionary loan. |
Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the Consolidated statement of comprehensive income. |
For financial assets measured at amortised cost, the impairment loss is measured as the difference between an asset's carrying amount and the present value of estimated cash flows discounted at the asset's original effective interest rate. If a financial asset has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate determined under the contract. |
For financial assets measured at cost less impairment, the impairment loss is measured as the difference between an asset's carrying amount the best estimate of the recoverable amount, which is an approximation of the amount that the Group would receive for the asset if it were sold at the balance sheet date. |
Financial assets and liabilities are offset and the net amount reported in the Balance sheet when there is an enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously. |
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. |
Dividends |
Equity dividends are recognised when they become legally payable. Interim equity dividends are recognised when paid. Final equity dividends are recognised when approved by the shareholders at an annual general meeting. |
Taxation |
Taxation for the year comprises current and deferred tax. Tax is recognised in the Consolidated Income Statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. |
Current or deferred taxation assets and liabilities are not discounted. |
Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date. |
Deferred tax |
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date. |
Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference. |
Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. |
Shepperton Group Limited (Registered number: 01305567) |
Notes to the Consolidated Financial Statements - continued |
for the Year Ended 30 September 2022 |
2. | ACCOUNTING POLICIES - continued |
Operating leases: the group as lessee |
Rentals paid under operating leases are charged to profit or loss on a straight line basis over the lease term. |
Benefits received and receivable as an incentive to sign an operating lease are recognised on a straight line basis over the lease term, unless another systematic basis is representative of the time pattern of the lessee's benefit from the use of the leased asset. |
Pension costs and other post-retirement benefits |
The Group operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Group pays fixed contributions into a separate entity. Once the contributions have been paid the Group has no further payment obligations. |
The contributions are recognised as an expense in profit of 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. |
Interest income |
Interest income is recognised in profit or loss using the effective interest method. |
Borrowing costs |
Except for those costs capitalised as work in progress, all borrowing costs are recognised in the Consolidated statement of comprehensive income in the year in which they are incurred. |
3. | CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY |
The preparation of financial statements in conformity with generally accepted accounting practice requires management to make estimates and judgements that affect the reported amounts of assets and liabilities as well as the disclosure of contingent assets and liabilities at the balance sheet date and the reported amounts of revenue and expenses during the reporting period. |
Revenue and margin recognition |
The Group's revenue recognition and margin recognition policies in respect of long term contracts are central to the way in which the Group values the work it has carried out each financial period. This policy requires forecasts to be made of the outcomes of the contracts, which require assessments and judgements to be made on the margin likely to be achieved, and hence the costs likely to be incurred. |
Valuation of work in progress |
Work in progress comprises costs related to property development. It is initially recorded at cost and then subsequently reviewed regularly by the Directors to ensure it is being valued at the lower of cost and net realisable value. |
Stock provisions |
The Group is required to critically assess the likelihood of future revenue from land options and other stocks held at year end and to make sufficient provisions as are deemed necessary against costs included within stock which may not be recoverable through future sales. |
4. | TURNOVER |
The turnover and loss (2021 - profit) before taxation are attributable to the one principal activity of the group. |
An analysis of turnover by class of business is given below: |
2022 | 2021 |
£ | £ |
Construction contracts | 24,667,570 | 40,141,165 |
Sale of land and property | 3,513,280 | 4,499,489 |
28,180,850 | 44,640,654 |
All turnover arose within the United Kingdom. |
Shepperton Group Limited (Registered number: 01305567) |
Notes to the Consolidated Financial Statements - continued |
for the Year Ended 30 September 2022 |
5. | EMPLOYEES AND DIRECTORS |
Staff costs, including directors' remuneration, were as follows: |
2022 | 2021 |
£ | £ |
Wages and salaries | 3.683.482 | 4,408,519 |
Social security costs | 448.079 | 503,947 |
Cost of defined pension contribution scheme | 279.685 | 304,760 |
4.411.247 | 5,217,226 |
The average monthly number of employees, including the directors, during the year was as follows: |
2022 | 2021 |
No. | No. |
Management | 7 | 10 |
Office administration | 21 | 26 |
Construction | 38 | 42 |
66 | 78 |
6. | DIRECTORS' EMOLUMENTS |
2022 | 2021 |
£ | £ |
Directors' emoluments | 230,600 | 376,087 |
Company contribution to defined contribution pension schemes | 13,321 | 13,317 |
243,921 | 389,404 |
During the year retirement benefits were accruing to 1 directors (2021 - 1) in respect of defined benefit contribution pension schemes. |
The highest paid director received remuneration of £174,600 (2021 - £231,847). |
The value of the company's contributions paid to a defined contribution pension scheme in respect of the highest paid director amount to £13,321 (2021 - £13,317). |
Key management are those persons having authority and responsibility for planning, controlling and directing the activities of the group, or in relation to the company. In the opinion of the board the group and company's key management are the directors. The total remuneration paid to key management personnel for the year totalled £230,600 (2021 - £460,400). |
7. | OPERATING (LOSS)/PROFIT |
The operating loss (2021 - operating profit) is stated after charging: |
2022 | 2021 |
£ | £ |
Depreciation of tangible fixed assets | 76,874 | 89,010 |
Auditors' remuneration for audit of the financial statements of the Company | 8,000 | 7,500 |
Auditors' remuneration for audit of the financial statements of the Group's subsidiaries |
25,000 |
26,085 |
Auditors' remuneration for non-audit services | 1,500 | 2,200 |
Other operating lease rentals | 57,193 | 58,425 |
Stock charged as an expense | 2,434,585 | 916,252 |
Shepperton Group Limited (Registered number: 01305567) |
Notes to the Consolidated Financial Statements - continued |
for the Year Ended 30 September 2022 |
8. | INTEREST PAYABLE AND SIMILAR EXPENSES |
2022 | 2021 |
£ | £ |
Bank interest | 5,394 | 5,050 |
Bank loan interest | 8,843 | 8,466 |
Interest payable | 4,963 | 527 |
19,200 | 14,043 |
9. | TAXATION |
Analysis of the tax charge |
The tax charge on the loss for the year was as follows: |
2022 | 2021 |
£ | £ |
Current tax: |
UK corporation tax | 32,269 | 67,393 |
Tax on (loss)/profit | 32,269 | 67,393 |
UK corporation tax has been charged at 19 % (2021 - 19 %). |
Reconciliation of total tax charge included in profit and loss |
The tax assessed for the year is higher than the standard rate of corporation tax in the UK. The difference is explained below: |
2022 | 2021 |
£ | £ |
(Loss)/profit before tax | (2,394,969 | ) | 359,649 |
(Loss)/profit multiplied by the standard rate of corporation tax in the UK of 19 % (2021 - 19 %) |
(455,044 |
) |
68,333 |
Effects of: |
Expenses not deductible for tax purposes | 2,069 | 5,229 |
Income not taxable for tax purposes | - | (51,776 | ) |
Depreciation in excess of capital allowances | 5,698 | 4,658 |
Utilisation of tax losses | (31,518 | ) | (16,571 | ) |
Other timing differences leading to an increase in taxation | - | 57,520 |
Group relief | 36,002 | - |
Losses carried forward | 475,062 | - |
Total tax charge | 32,269 | 67,393 |
The Finance Bill 2021 includes legislation to increase the main rate of corporation tax from 19% to 25% from 1 April 2023. |
10. | INDIVIDUAL INCOME STATEMENT |
As permitted by Section 408 of the Companies Act 2006, the Income Statement of the parent company is not presented as part of these financial statements. |
11. | DIVIDENDS |
2022 | 2021 |
£ | £ |
Ordinary A shares of £0.10 each |
Interim | - | 50,000 |
Shepperton Group Limited (Registered number: 01305567) |
Notes to the Consolidated Financial Statements - continued |
for the Year Ended 30 September 2022 |
12. | TANGIBLE FIXED ASSETS |
Group |
Plant & |
machinery, |
fixtures |
& fittings, |
Freehold | Motor | office |
property | vehicles | equipment | Totals |
£ | £ | £ | £ |
COST |
At 1 October 2021 | 1,699,718 | 18,055 | 417,433 | 2,135,206 |
Additions | - | - | 35,608 | 35,608 |
Disposals | - | - | (27,264 | ) | (27,264 | ) |
At 30 September 2022 | 1,699,718 | 18,055 | 425,777 | 2,143,550 |
DEPRECIATION |
At 1 October 2021 | 254,086 | 7,750 | 232,932 | 494,768 |
Charge for year | 25,210 | 3,000 | 48,664 | 76,874 |
Eliminated on disposal | - | - | (27,264 | ) | (27,264 | ) |
At 30 September 2022 | 279,296 | 10,750 | 254,332 | 544,378 |
NET BOOK VALUE |
At 30 September 2022 | 1,420,422 | 7,305 | 171,445 | 1,599,172 |
At 30 September 2021 | 1,445,632 | 10,305 | 184,501 | 1,640,438 |
Company |
Plant & |
machinery, |
fixtures |
Fixtures | & fittings, |
Freehold | and | office |
property | fittings | equipment | Totals |
£ | £ | £ | £ |
COST |
At 1 October 2021 |
Additions |
At 30 September 2022 |
DEPRECIATION |
At 1 October 2021 |
Charge for year |
At 30 September 2022 |
NET BOOK VALUE |
At 30 September 2022 |
At 30 September 2021 |
Shepperton Group Limited (Registered number: 01305567) |
Notes to the Consolidated Financial Statements - continued |
for the Year Ended 30 September 2022 |
13. | FIXED ASSET INVESTMENTS |
Company |
Shares in |
group |
undertakings |
£ |
COST |
At 1 October 2021 |
and 30 September 2022 |
NET BOOK VALUE |
At 30 September 2022 |
At 30 September 2021 |
Subsidiary undertakings |
The following were subsidiary undertakings of the Company: |
Name |
Principal activity |
Class of shares |
Holding |
Halsall Construction Limited | Construction | Ordinary | 100% |
Halsall Homes Limited | Construction | Ordinary | 100% |
Shepperton Builders Limited | Construction | Ordinary | 100% |
Halsall Properties Limited | Dormant | Ordinary | 100% |
Portform Two Limited | Dormant | Ordinary | 100% |
Portform Three Limited | Dormant | Ordinary | 100% |
Portform Limited | Dormant | Ordinary | 100% |
The registered office of both Halsall Construction Limited and Halsall Homes Limited is 1 Roman Way, Bath Business Park, Peasedown St John, Bath, Somerset, BA2 8SG. All other subsidiaries are registered at 11 Lansdowne Court, Bumpers Way, Chippenham, England, SN15 6RZ. |
14. | STOCKS |
2022 | 2021 |
£ | £ |
Land held for resale | 2,654,430 | 2,707,817 |
Work in progress | 3,156,157 | 1,678,922 |
5,810,587 | 4,386,739 |
The carrying value of stock includes capitalised interest of £67,200 (2021 - £35,672). |
15. | DEBTORS |
Group | Company |
2022 | 2021 | 2022 | 2021 |
£ | £ | £ | £ |
Amounts falling due within one year: |
Trade debtors | 2,373,940 | 3,804,895 |
Amounts owed by group undertakings | - | - |
Amounts recoverable on contract | 1,019,505 | 1,308,937 |
Amounts owed by related parties | 4,128,166 | 4,290,671 |
Other debtors | 483,076 | 420,609 |
Prepayments and accrued income | 146,840 | 186,599 |
8,151,527 | 10,011,711 |
Shepperton Group Limited (Registered number: 01305567) |
Notes to the Consolidated Financial Statements - continued |
for the Year Ended 30 September 2022 |
15. | DEBTORS - continued |
Group | Company |
2022 | 2021 | 2022 | 2021 |
£ | £ | £ | £ |
Amounts falling due after more than one | year: |
Amounts recoverable on contract | 946,373 | 710,558 |
Aggregate amounts | 9,097,900 | 10,722,269 |
16. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
Group | Company |
2022 | 2021 | 2022 | 2021 |
£ | £ | £ | £ |
Bank loans and overdrafts (see note 18) | 1,903,086 | 360,716 |
Trade creditors | 4,376,390 | 3,919,948 |
Amounts owed to related parties | 38,526 | 199,549 |
Amounts owed to group undertakings | - | - |
Tax | - | 9,874 |
Social security and other taxes | 226,023 | 456,910 |
Other creditors | 274,087 | 7,553,034 |
Accruals and deferred income | 5,985,686 | 1,518,123 |
12,803,798 | 14,018,154 |
17. | CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR |
Group | Company |
2022 | 2021 | 2022 | 2021 |
£ | £ | £ | £ |
Bank loans (see note 18) | 376,699 | 413,269 |
Trade creditors | 1,096,275 | 784,877 |
1,472,974 | 1,198,146 |
18. | LOANS |
An analysis of the maturity of loans is given below: |
Group | Company |
2022 | 2021 | 2022 | 2021 |
£ | £ | £ | £ |
Amounts falling due within one year or on | demand: |
Bank loans | 1,903,086 | 360,716 |
Amounts falling due between two and five | years: |
Bank loans - 2-5 years | 173,438 | 321,970 |
Amounts falling due in more than five years: |
Repayable by instalments |
Bank loans more 5 yr by instal | 203,261 | 91,299 | 84,481 | 91,300 |
Shepperton Group Limited (Registered number: 01305567) |
Notes to the Consolidated Financial Statements - continued |
for the Year Ended 30 September 2022 |
18. | LOANS - continued |
Bank loans of £1,865,514 (2021 - £314,482) due within one year in Shepperton Builders Limited, a subsidiary undertaking, were secured by fixed charges over the company's freehold land and properties and a floating charge over the company's assets. Bank loans were repayable on demand or on the sale of the development property to which they relate and attracted interest at 4.75% above bank Base Rate. This loan was fully repaid during the financial year. |
Bank loans of £27,757 (2021 - £35,130) due within one year, £128,223 (2021 - £149,029) due between 2 and 5 years and £118,780 (2021 - £125,103) due after more than 5 years in Halsall Construction Limited, a subsidiary undertaking, are secured by fixed charges over the company's freehold land and properties and a floating charge over the company's other assets. The bank loan is repayable on demand or on the sale of the development property to which it relates and attracts interest of Base Rate plus £2.29%. |
The remaining bank loan of £139,512 (2021 - £150,242) is secured by a fixed charge over the freehold property and a floating charge on the other assets of the company. It attracts interest at Base Rate plus 2.95% per annum and is repayable in instalments. |
19. | LEASING AGREEMENTS |
Minimum lease payments fall due as follows: |
Group |
Non-cancellable operating | leases |
2022 | 2021 |
£ | £ |
Within one year | 35,869 | 42,119 |
Between one and five years | 28,342 | 26,316 |
64,211 | 68,435 |
The Group and Company had no commitments under non-cancellable operating leases as at the current or prior balance sheet date. |
20. | FINANCIAL INSTRUMENTS |
The carrying value of the group's financial assets and liabilities are summarised by category below: |
2022 | 2021 |
£ | £ |
Financial Assets |
Cash held at bank and in hand | 4,207,757 | 7,332,736 |
Financial assets that are debt instruments measured at amortised cost | 8,951,060 | 10,224,350 |
13,158,817 | 17,557,086 |
Financial liabilities |
Financial liabilities measured at amortised cost | 13,888,849 | 14,455,457 |
Financial assets that are debt instruments measured at amortised cost, comprise debtors other than prepayments. |
Financial liabilities measured at amortised cost comprise creditors other than taxation. |
Shepperton Group Limited (Registered number: 01305567) |
Notes to the Consolidated Financial Statements - continued |
for the Year Ended 30 September 2022 |
21. | CALLED UP SHARE CAPITAL |
Allotted, issued and fully paid: |
Number: | Class: | Nominal | 2022 | 2021 |
value: | £ | £ |
Ordinary A | £0.10 | 2,000 | 2,000 |
Ordinary B | £0.10 | 10 | 10 |
Ordinary C | £0.10 | 10 | 10 |
2,020 | 2,020 |
Holders of Ordinary A shares are entitled to dividend payments according to the time being paid up on them. These shares are irredeemable and carry one vote per share. |
Holders of Ordinary B and C shares are not entitled to receive dividend payments. These shares are irredeemable and do not carry any voting rights. |
22. | RESERVES |
Other reserves |
Other reserves constitutes a capital reserve which is not available for distribution. |
Profit and loss account |
Profit and loss account represents the entity's accumulated earnings less dividends paid and payable. |
23. | PENSION COMMITMENTS |
The Group operates a defined contribution pension scheme. The assets of the scheme are held separately from those of the Group in an independently administered fund. The pension cost charge represents contributions payable by the Group to the fund and amounted to £279,685 (2021 - £304,760). Contributions totalling £26,641 (2021 - £32,150) were payable to the fund at the balance sheet date. |
24. | CONTINGENT LIABILITIES |
The company is party to cross guarantees in respect of certain bank borrowings of group companies. These are secured by a floating charge over the assets of all group companies and a fixed charge over certain freehold properties in various group companies. |
25. | RELATED PARTY DISCLOSURES |
As at the balance sheet date there were amounts owed to Shepperton Group Limited from Shepperton Properties Limited of £1,085,597 (2021 - £1,247,739) being a connected company. |
As at the balance sheet date there were amounts owed to Shepperton Group Limited from Shepperton Ventures Limited of £6,787 (2021 - £6,787) the company's ultimate parent. |
As at the balance sheet date there were amounts due to Shepperton Builders Limited from the ultimate parent company Shepperton Ventures Limited of £3,034,782 (2021 - £3,034,782) in relation to the demerger of Shepperton Properties Limited, this debt is secured on the shares in Shepperton Properties Limited. |
As at the balance sheet date an amount of £Nil (2021 - £161,022) was due from Shepperton Builders Limited to Shepperton Properties Limited, a company controlled by Shepperton Ventures Limited. |
26. | ULTIMATE CONTROLLING PARTY |
The ultimate controlling part of Shepperton Group Limited is Shepperton Ventures Limited which is controlled by its shareholder G K Davis. Shepperton Ventures Limited is a company incorporated in the British Virgin Islands. |