Company registration number 13539191 (England and Wales)
COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 30 JUNE 2022
COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
COMPANY INFORMATION
Directors
Mr S Fernando
Mr T O Ogden
(Appointed 21 December 2021)
Mr D Mowat
(Appointed 21 December 2021)
Mr S Clare
(Appointed 3 July 2023)
Company number
13539191
Registered office
Lowry House
17 Marble Street
Manchester
M2 3AW
Auditor
Xeinadin Audit Limited
Riverside House
Kings Reach Business Park
Yew Street
Stockport
SK4 2HD
COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
CONTENTS
Page
Strategic report
1 - 4
Directors' report
5
Directors' responsibilities statement
6
Independent auditor's report
7 - 9
Profit and loss account
10
Group statement of comprehensive income
11
Group balance sheet
12
Company balance sheet
13
Group statement of changes in equity
14
Company statement of changes in equity
15
Group statement of cash flows
16
Company statement of cash flows
17
Notes to the financial statements
18 - 38
COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
STRATEGIC REPORT
FOR THE PERIOD ENDED 30 JUNE 2022
- 1 -

The Strategic Report has been prepared for the Group as a whole and therefore gives greater emphasis to those matters which are significant to Cocogreen Professional Substrates Limited and its subsidiary undertakings when viewed as a whole.

Principal activities

The principal activity of the Group during the period is the manufacturing, importing, and exporting of Coir products. The principal activity of the Company is that of a holding company and as the parent of the Group. The Group’s core product is a coconut coir growing media (substrate) which we grow, process and ship to food growers, enabling them to grow more for less using a sustainable resource. The Group exports to 30+ countries, with more added every year.

Review of the business

Turnover across the Group for the period was £7,607,504 for the period ending 30th June 2022. The Group continues to be funded through its own working capital with cash reserves at 30th June 2022 amounting to £1,312,674 as well as access to an invoice finance facility. Shareholders’ funds are £2,905,029 as a result of loss in the period of £186,486.

Gross profit was £1,538,504 for the period. Gross profit was achieved across domestic and international markets with growth experienced through investment in existing operations. The Group’s gross margin is 20.2%.

Operating profit was £194,148 for the period. Exchange rate gains and losses relate predominantly to the retranslation of intercompany loans owed from fellow subsidiary companies from local currency to GBP. The loans were not called in during the year and there is no intention to do so post year end. Other comprehensive income also relates to currency translation of overseas subsidiaries from local currency to GBP.

The Group’s subsidiaries during the year are subject to local statutory audits by an external auditor in their local jurisdictions. For the current period results that are consolidated in the Group numbers, all local statutory audits have clean external audit opinions attributed to them in relation to the results for the period ended 30th June 2022.

The directors believe that investment into the Group during the year as a result of the transaction will result in the Group being well placed to deliver profitable returns in future years.

Principal risks and uncertainties

The principal risk to the business is a downturn in activity in the agricultural industry in which the Group provides Coir products. The directors manage this risk through a diversified international client base, along with an increasing presence across international location, being active in many crop categories possible, and with strong relationships are established.

The directors do not consider the Group to be subject to significant financial risk due to foreign exchange as the geographical spread of customers, utilisation of various currencies acceptable around the world mitigates against volatility in any one currency. The Group’s credit risk is primarily attributable to its trade receivables; however, the Group has no significant concentration of Credit risk with exposure spread over a diversified customer base. Furthermore, the Group has in place credit insurance which the directors believe has been set at appropriate levels to further mitigate credit risk to its receivables. The Group does not have a history of bad debts. The Group’s liquidity risk is managed through an invoice finance facility with the Group’s bankers.

The directors feel the Group have mitigated against any potential risks because of the war in Ukraine. The Group does not have a physical presence or office in these countries. The war in Ukraine is not affecting any Growth plans for the Group and the Group continues to trade as normal, mitigating risk by having an international customer base and is not subject to the economic performance of one country.

The directors feel the Group navigated Brexit due to the Group’s established global presence and minimal European exposure, and now our practice of hiring local market experts is paying dividends in overseas markets, such as Europe. The Group has complete control over the supply chain, meaning that in addition to confidently meeting growing demand, the Group can ensure consistent quality, excellent working conditions, and competitive pricing without compromising on sustainability goals. This level of control also allows the Group to continually refine a circular business model.

COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
- 2 -
Research and development

The Group continues to collaborate with numerous research teams. This allows us to share best practice and new innovations with our suppliers, customers and even competitors, ensuring that our coconut coir is grown, processed, used and recycled as sustainably as possible, backed up by our proven research, demonstrating how growers can save on water they would traditionally use, through irrigation control, and researching a new product range derived from spent coir, whilst reducing costs and achieving industry leading yield and financial returns. The Group’s in-house R&D initiatives have enhanced our product to the extent that it now supports higher yields and higher quality produce than traditional soil or alternative substrate/soilless agricultural methods. This is supported by the Group’s investment in unique technologies.

Key performance indicators

Earnings before interest, tax, depreciation and amortisation (EBITDA) was £324,421 during the period. EBITDA continues to be a key performance indicator as it provides a measure of the Group’s operating performance.

Directors statement of compliance with duty to promote the success of the Group

Stakeholder Group

Why we engage

How we engage

Employees

Our employees are an integral asset to the Group and to the effective delivery of our product. Their attraction to our business, ongoing development, motivation, and retention is key to the long-term success of the business. It is our responsibility to invest in them so they can succeed in their roles, and they grow, and drive the growth, of the Group

Engagement is through many channels. Group wide communication from the board is fed down on a departmental basis regarding vision, successes, and performance. Face to face channels with all employees tend to include regular team meetings and business reviews (appraisals). E-mail communication continues to support the business daily in every way. We commission independent surveys to determine the views of our employees.

Customers

Customers are either part of our network of distributors, or food growers themselves, growing high value, high sensitivity crops, using modern, high-tech systems. They range from smaller operations to large multinationals and we recognise that our successes rely on developing and continually investing in our relationships with them by doing everything we can to add value. The way we engage determines whether new customers are onboarded, whether this develops into repeat business, whether we are referred business and whether long-standing, embedded strategic partnerships are secured.

We are continuously communicating, networking with and effectively engaging customers regarding our impacts and sustainability achievements, through; key events, including for charity, which generate extensive PR; speaker slots at trade fairs, shows and conferences we’re invited to, e.g., a industry event on produce; calls and telephone surveys, and our employees and representatives, e.g., our international commercial sales team and distributors.

Suppliers

Our suppliers are fundamental to our ability to deliver services to our clients on a timely, flexible, sustainably compliant way. We expect all our suppliers to operate in a professional way and in line with our own values.

The Group encourages businesses in the supply chain to reduce their carbon footprint and reliance on fossil fuels. The Group’s SQS certification is part of this, providing full visibility and control over the supply chain. The Group is also working with farmers to encourage them to recycle their spent materials back into the earth.

COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
- 3 -
Directors statement of compliance with duty to promote the success of the Group

Stakeholder Group

Why we engage

How we engage

Environment

We understand that sustainability is quickly becoming a key pillar of modern business and society. We look to work with suppliers that are aligned to our own environmental expectations, just as our growers look to partner with ethical suppliers in line with their own environmental objectives.

ESG has always been core to the purpose of Cocogreen, but today we see more and more customers adopting ESG-centric approaches, highlighting the changing priorities within food production and global business. Certifications serve as an external benchmark for organisational goals, with the Group holding certifications such as OMRI (Organic Materials Review Institute) meaning that products grown on the Group’s substrates can in turn be sold as organic across international markets, ECOCERT and LEAF(Linking Environment and Farming), meeting their standards for delivering more sustainable food and farming.

Community and charities

We recognise that by actively supporting our local communities we develop closer ties and trust, create more opportunity locally and support long term sustainability to the areas and countries we operate within.

Cocogreen supports quality of life improvements for our employees and communities. Working in purpose-driven organisations, especially with diverse representation, positively impacts engagement, productivity and performance. We encourage local fund-raising events held by our employees in local offices for their local communities to be the best way supporting our local communities. Equally, we support employees who fundraise for the charities they hold close to their hearts.

 

The table below shows the key events and decisions made by the Board during the year, the stakeholders they impacted, and the associated actions taken by the directors to engage with the relevant stakeholders. Events and decisions are considered to be key if they are either material to the business or have a significant impact on one or more category of stakeholder.

 

Key events / decisions

Stakeholders affected

Actions and impact

The group decided to purse a private equity investment during the year

Shareholders, Employees and Lenders

Discussions with interested investors were arranged in order to identify a suitable investor. Detailed Due Diligence process was completed by both the buyer and the seller. Successful completion of the transaction to enable ambitious growth plans of the business.

 

COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
- 4 -

Disabled employees

Applications for employment by disabled persons are always fully considered, bearing in mind the abilities of the applicant concerned. In the event of members of staff being disabled every effort it made to ensure that their employment with the Group continues, and that appropriate training is arranged. It is the policy of the Group and the Company that the training, career development and promotion of disabled persons should, as far as possible, be identical to that of other employees.

Employee consultation

The Group places considerable value on the involvement of its employees and has continued to keep them informed on matters affecting them as employees and on the various factors affecting the performance of the group and the Company. This is achieved through formal and informal meetings. Employees are consulted regularly on a wide range of matters affecting their current and future interests.

Future developments

The subsidiaries in Sri Lanka have had a new auditor appointed for the 2023 financial year, to further support the Group’s global growth plans and structure.

The directors expect the general level of activity to increase in the forthcoming year. This is supporting by the continued domestic and international growth of the business and subsequent investment during the year from our investors, along with increased investment in production capacity to meet demand. The Group aims to be carbon neutral by 2026 as implementations fully mature.

On behalf of the board

Mr S Fernando
Director
23 November 2023
COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
DIRECTORS' REPORT
FOR THE PERIOD ENDED 30 JUNE 2022
- 5 -

The directors present their annual report and financial statements for the period ended 30 June 2022.

Results and dividends

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

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

Directors

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

Mr S Fernando
Mr T O Ogden
(Appointed 21 December 2021)
Mr D Mowat
(Appointed 21 December 2021)
Mr S Clare
(Appointed 3 July 2023)
Mr S Shelbourn
(Appointed 3 November 2022 and resigned 30 June 2023)

 

Mr S Fernando was appointed when the company was incorporated, which was 30th July 2021.

Going Concern

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

Statement of disclosure to auditor

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

On behalf of the board
Mr S Fernando
Director
23 November 2023
COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE PERIOD ENDED 30 JUNE 2022
- 6 -

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

 

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

 

 

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

 

The directors confirm that so far as they are aware, there is no relevant audit information (as defined by section 418(3) of the Companies Act 2006) of which the company's auditors are unware. They have taken all the steps that they ought to have taken as directors in order to make themselves aware of any relevant audit information and to establish that the company's auditors are aware of that information.

COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
- 7 -
Disclaimer of Opinion

We were engaged to audit the consolidated financial statements of Cocogreen Professional Substrates Limited (“the Parent Company”) and its subsidiaries (“the Group”), for the period ended 30 June 2022 which comprise the profit and loss account, the statement of comprehensive income, the balance sheet, the statement of changes in equity, the statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

We do not express an opinion on the accompanying financial statements of the Group. Because of the significance of the matters described in the Basis for Disclaimer of Opinion section of our report, we have not been able to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion on these consolidated financial statements.

Basis for Disclaimer of Opinion

The Group contains a financially significant component; Cocogreen UK Lanka Group (Pvt) Limited; a company incorporated in Sri Lanka. This component manufactures and exports coir products on behalf of the group and is audited by a component auditor based in Sri Lanka. For the purposes of our audit, we conducted pre-planning procedures in conjunction with the Sri Lankan Auditor which included an agreement with them that they would provide us with their audit working papers upon request.

In accordance with the agreements at the pre-planning stage, we arranged to review the working papers of the component auditor; however, our attempts to review the auditor’s working papers were unsuccessful. Accordingly, we are unable to say to what extent the absence of our review of the working papers may have had on our ability to assess the quality and reliability of the financial information included within these financial statements. We designed alternative audit procedures, including enquiries of management but the outcome of these alternative procedures meant that we were still not able to gather sufficient appropriate evidence over certain material balances as set out below.

The material balances over which we were unable to gather sufficient appropriate audit evidence, which relate to Cocogreen UK Lanka Group (Pvt) Limited and are contained in the Group’s Consolidated Balance Sheet after consolidation adjustments are as follows: Leasehold land & buildings £398,355; Plant & Machinery £363,796; Motor Vehicles £235,170; Capital Work In progress £158,185; Stock £1,263,091; Other debtors £352,411, Cash at bank and in hand £254,396; Trade creditors £236,043; Deferred tax liabilities £124,504.

The material balances over which we were unable to gather sufficient appropriate audit evidence, which relate to Cocogreen UK Lanka Group (Pvt) Limited and are contained in the Group’s Consolidated Profit & Loss Account after consolidation adjustments are as follows: Other operating income £115,143; deferred tax timing differences £127,504.

 

In addition to the matter above, shortly before the Group was established, three Group components based in Sri Lanka sold land and buildings amounting to £1,162,299 to a related party. The land and buildings have been subsequently leased back to the Group. We have been unable to verify if the sale and leaseback of the land and buildings has been accounted for correctly by all Group components and therefore have been unable to verify if the opening and closing balances in relation to these transactions are correctly stated in these consolidated financial statements.

 

As a result of the matters described above; we were unable to determine whether any adjustments might have been found necessary in respect of the balances described and the associated elements making up the statement of comprehensive income, statement of changes in equity, statement of cash flows and associated disclosure notes to the financial statements. Accordingly, we are unable to express an opinion on the accompanying financial statements.

COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
- 8 -

Opinions on other matters prescribed by the Companies Act 2006

Because of the significance of the matter described in the basis for disclaimer of opinion section of our report, we have been unable to form an opinion, whether based on the work undertaken in the course of the audit:

• the information given in the strategic report and directors’ report for the period for which the financial statements are prepared is consistent with the financial statements; and

• the strategic report and directors’ report have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

Notwithstanding our disclaimer of an opinion on the financial statements, in the light of the knowledge and understanding of the company and its environment obtained in the course of the audit performed subject to the pervasive limitation described above, we have not identified material misstatements in the strategic report or the directors’ report.

 

Arising from the limitation of our work referred to above:

• we have not obtained all the information and explanations that we considered necessary for the purpose of our audit; and

• we were unable to determine whether adequate accounting records have been kept; and

• returns adequate for our audit have not been received from components not visited by us

 

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:

• the financial statements are not in agreement with the accounting records and returns; or

• certain disclosures of directors’ remuneration specified by law are not made

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the parent company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the parent company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

Our responsibility is to conduct an audit of the group financial statements in accordance with International Standards on Auditing (UK) and to issue an auditor’s report.

However, because of the matter described in the basis for disclaimer of opinion section of our report, we were not able to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion on these financial statements.

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.

Use of our report

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

 

 

 

COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
- 9 -
...................
Nichola Coles (FCCA) (Senior Statutory Auditor)
For and on behalf of Xeinadin Audit Limited
23 November 2023
Accountants
Statutory Auditor
Riverside House
Kings Reach Business Park
Yew Street
Stockport
SK4 2HD
COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
GROUP PROFIT AND LOSS ACCOUNT
FOR THE PERIOD ENDED 30 JUNE 2022
- 10 -
Period
ended
30 June
2022
Notes
£
Turnover
3
7,607,504
Cost of sales
(6,069,000)
Gross profit
1,538,504
Distribution costs
(218,416)
Administrative expenses
(1,589,395)
Other operating income
463,455
Operating profit
4
194,148
Interest receivable and similar income
8
2,231
Interest payable and similar expenses
9
(286,040)
Loss before taxation
(89,661)
Tax on loss
10
(96,825)
Loss for the financial period
25
(186,486)
Loss for the financial period is all attributable to the owners of the parent company.
COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE PERIOD ENDED 30 JUNE 2022
- 11 -
Period
ended
30 June
2022
£
Loss for the period
(186,486)
Other comprehensive income
Currency translation loss arising in the period
(967,446)
Total comprehensive income for the period
(1,153,932)
Total comprehensive income for the period is all attributable to the owners of the parent company.
COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
GROUP BALANCE SHEET
AS AT
30 JUNE 2022
30 June 2022
- 12 -
2022
Notes
£
£
Fixed assets
Goodwill
11
370,763
Other intangible assets
11
1,677
Total intangible assets
372,440
Tangible assets
12
1,478,971
1,851,411
Current assets
Stocks
15
1,430,020
Debtors
16
5,730,599
Cash at bank and in hand
1,312,674
8,473,293
Creditors: amounts falling due within one year
17
(5,550,139)
Net current assets
2,923,154
Total assets less current liabilities
4,774,565
Creditors: amounts falling due after more than one year
18
(1,709,076)
Provisions for liabilities
Deferred tax liability
21
157,679
(157,679)
Net assets excluding pension liability
2,907,810
Defined benefit pension liability
22
(51,750)
Net assets
2,856,060
Capital and reserves
Called up share capital
23
12,446
Share premium account
24
3,997,546
Other reserves
(967,446)
Profit and loss reserves
25
(186,486)
Total equity
2,856,060
The financial statements were approved by the board of directors and authorised for issue on 23 November 2023 and are signed on its behalf by:
23 November 2023
Mr S Fernando
Director
Company registration number 13539191 (England and Wales)
COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
COMPANY BALANCE SHEET
AS AT 30 JUNE 2022
30 June 2022
- 13 -
2022
Notes
£
£
Fixed assets
Investments
13
1,640,904
Current assets
Debtors
16
2,523,795
Cash at bank and in hand
723,951
3,247,746
Creditors: amounts falling due within one year
17
(922,800)
Net current assets
2,324,946
Net assets
3,965,850
Capital and reserves
Called up share capital
23
12,446
Share premium account
24
3,997,546
Profit and loss reserves
25
(44,142)
Total equity
3,965,850

As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s loss for the period was £44,142.

The financial statements were approved by the board of directors and authorised for issue on 23 November 2023 and are signed on its behalf by:
23 November 2023
Mr S Fernando
Director
Company registration number 13539191 (England and Wales)
COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 30 JUNE 2022
- 14 -
Share capital
Share premium account
Other reserves
Profit and loss reserves
Total
Notes
£
£
£
£
£
Balance at 1 December 2021
-
-
-
-
-
Period ended 30 June 2022:
Loss for the period
-
-
-
(186,486)
(186,486)
Other comprehensive income:
Currency translation differences
-
-
(967,446)
-
0
(967,446)
Total comprehensive income
-
-
(967,446)
(186,486)
(1,153,932)
Issue of share capital
23
12,446
3,997,546
-
-
4,009,992
Balance at 30 June 2022
12,446
3,997,546
(967,446)
(186,486)
2,856,060
COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 30 JUNE 2022
- 15 -
Share capital
Share premium account
Profit and loss reserves
Total
Notes
£
£
£
£
Balance at 1 December 2021
-
-
-
-
Period ended 30 June 2022:
Profit and total comprehensive income
-
-
(44,142)
(44,142)
Issue of share capital
23
12,446
3,997,546
-
4,009,992
Balance at 30 June 2022
12,446
3,997,546
(44,142)
3,965,850
COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
GROUP STATEMENT OF CASH FLOWS
FOR THE PERIOD ENDED 30 JUNE 2022
- 16 -
2022
Notes
£
£
Cash flows from operating activities
Cash absorbed by operations
28
(2,787,896)
Interest paid
(210,181)
Income taxes refunded
200,680
Net cash outflow from operating activities
(2,797,397)
Investing activities
Purchase of intangible assets
(429,767)
Purchase of tangible fixed assets
(1,623,433)
Proceeds from disposal of tangible fixed assets
55,452
Repayment of loans
(15,123)
Interest received
2,231
Net cash used in investing activities
(2,010,640)
Financing activities
Proceeds from issue of shares
4,009,992
Proceeds from bank loans
2,563,867
Proceeds from finance leases obligations
79,534
Net cash generated from/(used in) financing activities
6,653,393
Net increase in cash and cash equivalents
1,845,356
Cash and cash equivalents at beginning of period
-
Effect of foreign exchange rates
(967,446)
Cash and cash equivalents at end of period
877,910
Relating to:
Cash at bank and in hand
1,312,674
Bank overdrafts included in creditors payable within one year
(434,764)
877,910
COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
COMPANY STATEMENT OF CASH FLOWS
FOR THE PERIOD ENDED 30 JUNE 2022
- 17 -
2022
Notes
£
£
Cash flows from operating activities
Cash absorbed by operations
29
(1,630,137)
Investing activities
Investment
(1,640,904)
Repayment of loans
(15,000)
Net cash used in investing activities
(1,655,904)
Financing activities
Proceeds from issue of shares
4,009,992
Net cash generated from/(used in) financing activities
4,009,992
Net increase in cash and cash equivalents
723,951
Cash and cash equivalents at beginning of period
-
Cash and cash equivalents at end of period
723,951
COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 30 JUNE 2022
- 18 -
1
Accounting policies
Company information

Cocogreen Professional Substrates Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is Lowry House, 17 Marble Street, Manchester, M2 3AW.

 

The group consists of Cocogreen Professional Substrates Limited and all of its subsidiaries.

 

The company was incorporated on 30th July 2021 and commenced trading on 2nd December 2021 when it acquired 100% of the share capital of S2H Group Limited, a group of companies incorporated in England, and Cocogreen UK Lanka Group (Pvt) Limited, a group of companies incorporated in Sri Lanka.

1.1
Reporting period

The financial statements are prepared for the seven month period ended 30 June 2022. This is the first period since incorporation therefore the financial statements do not contain any comparative amounts.

1.2
Accounting convention

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

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

1.3
Business combinations

The consolidated financial statements incorporate the results of business combinations using the purchase method. In the Statement of Financial Position, the acquiree's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date.

1.4
Basis of consolidation

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

 

All financial statements are made up to 30 June 2022. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.

 

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

Subsidiaries are consolidated in the group’s financial statements from the date that control commences until the date that control ceases.

1.5
Going concern

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

COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
1
Accounting policies
(Continued)
- 19 -
1.6
Turnover

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

 

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

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

1.7
Research and development expenditure

Research expenditure is written off against profits in the year in which it is incurred. Identifiable development expenditure is capitalised to the extent that the technical, commercial and financial feasibility can be demonstrated.

1.8
Intangible fixed assets - goodwill

Goodwill represents the excess of the cost of acquisition of a business over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is five years.

 

For the purposes of impairment testing, goodwill is allocated to the cash-generating units expected to benefit from the acquisition. Cash-generating units to which goodwill has been allocated are tested for impairment at least annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit.

1.9
Intangible fixed assets other than goodwill

Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.

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

Other intangible assets
5 years
1.10
Tangible fixed assets

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

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

Leasehold land and buildings
12% reducing balance
Plant and equipment
10% straight line
Fixtures and fittings
25% reducing balance
Computers
25% straight line
Motor vehicles
25% reducing balance
COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
1
Accounting policies
(Continued)
- 20 -

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

1.11
Fixed asset investments

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

 

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

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

1.12
Impairment of fixed assets

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

 

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

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

 

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

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

1.13
Stocks

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

 

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

COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
1
Accounting policies
(Continued)
- 21 -

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

1.14
Cash and cash equivalents

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

1.15
Financial instruments

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

 

Financial instruments are classified and accounted for, according to the substance of the contractual arrangement, as either financial assets, financial liabilities or equity instruments. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all its liabilities.

 

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

 

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

Basic financial assets

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

Derecognition of financial assets

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

Classification of financial liabilities

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

COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
1
Accounting policies
(Continued)
- 22 -
Basic financial liabilities

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

 

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

 

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

Derecognition of financial liabilities

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

1.16
Equity instruments

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

Changes in the fair value of derivatives that are designated and qualify as fair value hedges are recognised in profit and loss immediately, together with any changes in the fair value of the hedged asset or liability that are attributable to the hedged risk.

1.17
Taxation

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

Current tax

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

COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
1
Accounting policies
(Continued)
- 23 -
Deferred tax

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

 

Timing differences are differences between taxable profits and the results as stated in the Financial Statements which arise from the inclusion of gains and losses in tax assessments in periods different from those in which they are recognised for tax purposes.

 

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.

 

A net deferred tax asset is regarded as recoverable and therefore recognised only when it can be regarded as more likely than not that there will be suitable taxable profits from which the future reversal of underlying timing difference can be deducted.

 

Deferred tax is measured at the average tax rates which are expected to apply in the periods in which the timing differences are expected to reverse, based on tax rates and laws which have been enacted or substantively enacted by the balance sheet date. Deferred tax is measured on a non-discounted basis.

 

Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset if, and only if, there is a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

1.18
Employee benefits

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

 

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

 

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

1.19
Retirement benefits

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

The cost of providing benefits under defined benefit plans is determined separately for each plan using the projected unit credit method, and is based on actuarial advice.

 

The change in the net defined benefit liability arising from employee service during the year is recognised as an employee cost. The cost of plan introductions, benefit changes, settlements and curtailments are recognised as an expense in measuring profit or loss in the period in which they arise.

COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
1
Accounting policies
(Continued)
- 24 -

The net interest element is determined by multiplying the net defined benefit liability by the discount rate, taking into account any changes in the net defined benefit liability during the period as a result of contribution and benefit payments. The net interest is recognised in profit or loss as other finance revenue or cost.

 

Remeasurement changes comprise actuarial gains and losses, the effect of the asset ceiling and the return on the net defined benefit liability excluding amounts included in net interest. These are recognised immediately in other comprehensive income in the period in which they occur and are not reclassified to profit and loss in subsequent periods.

The net defined benefit pension asset or liability in the balance sheet comprises the total for each plan of the present value of the defined benefit obligation (using a discount rate based on high quality corporate bonds), less the fair value of plan assets out of which the obligations are to be settled directly. Fair value is based on market price information, and in the case of quoted securities is the published bid price. The value of a net pension benefit asset is limited to the amount that may be recovered either through reduced contributions or agreed refunds from the scheme.

1.20
Leases

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

 

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

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

1.21
Foreign exchange

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

 

On consolidation, the results of overseas operations are translated into Sterling at rates approximating to those ruling when the transactions took place. All assets and liabilities of overseas operations are translated at the rate ruling at the reporting date. Exchange differences arising on translating the opening net assets at opening rate and the results of overseas operations at actual rate are recognised in other comprehensive income.

2
Judgements and key sources of estimation uncertainty

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

 

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

COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
- 25 -
3
Turnover and other revenue
2022
£
Turnover analysed by class of business
UK sales
2,591,447
Rest of world sales
5,016,057
7,607,504
2022
£
Turnover analysed by geographical market
UK sales
2,591,447
Rest of world sales
5,016,057
7,607,504
2022
£
Other revenue
Interest income
2,231
4
Operating profit
2022
£
Operating profit for the period is stated after charging:
Depreciation of owned tangible fixed assets
72,946
Loss on disposal of tangible fixed assets
16,064
Amortisation of intangible assets
57,327
Operating lease charges
33,352
5
Auditor's remuneration
2022
Fees payable to the company's auditor and associates:
£
For audit services
Audit of the financial statements of the group and company
22,800
COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
- 26 -
6
Employees

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

Group
Company
2022
2022
Number
Number
Office
59
4
Production
317
-
Total
376
4

Their aggregate remuneration comprised:

Group
Company
2022
2022
£
£
Wages and salaries
439,479
-
0
Social security costs
49,188
-
Pension costs
4,779
-
0
493,446
-
0
7
Directors' remuneration
2022
£
Remuneration for qualifying services
194,096
Company pension contributions to defined contribution schemes
770
194,866
8
Interest receivable and similar income
2022
£
Interest income
Interest receivable from group companies
2,231
2022
Investment income includes the following:
£
Interest on financial assets not measured at fair value through profit or loss
2,231
COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
- 27 -
9
Interest payable and similar expenses
2022
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
145,835
Other interest on financial liabilities
58,954
204,789
Other finance costs:
Interest on finance leases and hire purchase contracts
5,188
Exchange differences on financing transactions
75,859
Other interest
204
Total finance costs
286,040
10
Taxation
2022
£
Current tax
UK corporation tax on profits for the current period
101,005
Deferred tax
Origination and reversal of timing differences
(4,180)
Total tax charge
96,825

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

2022
£
Loss before taxation
(89,661)
Expected tax credit based on the standard rate of corporation tax in the UK of 19.00%
(17,036)
Other permanent differences
113,861
Taxation charge
96,825

The tax charge in the Group profit and loss account is taken from the individual accounts of the Group's subsidiaries, which is for the year ended 30th June 2022.

 

The note above is based on the Group loss before taxation, which represents the seven-month period ended 30th June 2022.

 

In addition, there are overseas subsidiaries based in Sri Lanka where the rate of tax is 24% (income tax) or 14% (interest income) depending on the type of income.

COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
- 28 -
11
Intangible fixed assets
Group
Goodwill
Other intangible assets
Total
£
£
£
Cost
At 1 December 2021
-
0
16,722
16,722
Additions
419,732
-
0
419,732
At 30 June 2022
419,732
16,722
436,454
Amortisation and impairment
At 1 December 2021
-
0
6,687
6,687
Amortisation charged for the period
48,969
8,358
57,327
At 30 June 2022
48,969
15,045
64,014
Carrying amount
At 30 June 2022
370,763
1,677
372,440
COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
- 29 -
12
Tangible fixed assets
Group
Leasehold land and buildings
Capital work in progress
Plant and equipment
Fixtures and fittings
Computers
Motor vehicles
Total
£
£
£
£
£
£
£
Cost
At 1 December 2021
564,184
158,185
624,234
22,308
29,747
270,155
1,668,813
Additions
-
0
-
0
71,516
291
8,197
25,785
105,789
Disposals
-
0
-
0
(71,516)
-
0
-
0
-
0
(71,516)
At 30 June 2022
564,184
158,185
624,234
22,599
37,944
295,940
1,703,086
Depreciation and impairment
At 1 December 2021
42,093
-
0
51,506
8,080
19,850
29,640
151,169
Depreciation charged in the period
13,767
-
0
47,980
3,166
2,824
5,209
72,946
At 30 June 2022
55,860
-
0
99,486
11,246
22,674
34,849
224,115
Carrying amount
At 30 June 2022
508,324
158,185
524,748
11,353
15,270
261,091
1,478,971
Included within the net book value of tangible fixed assets is £122,836 in respect of assets held under hire purchase contracts. Depreciation for the year on these assets was £7,494
COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
- 30 -
13
Fixed asset investments
Group
Company
2022
2022
Notes
£
£
Investments in subsidiaries
14
-
0
1,640,904
Movements in fixed asset investments
Company
Investments
£
Cost or valuation
At 1 December 2021
-
Additions
1,640,904
At 30 June 2022
1,640,904
Carrying amount
At 30 June 2022
1,640,904

During the year, Cocogreen Professional Substrates Limited acquired the sub groups S2H Group Limited and Cocogreen UK Lanka Group (PVT) Ltd.

14
Subsidiaries

Details of the company's subsidiaries at 30 June 2022 are as follows:

Name of undertaking
Address
Nature of business
Class of
% Held
shares held
Direct
Indirect
Cocogreen UK Lanka Group (PVT) Ltd   * *
Sri Lanka
Holding Company
Ordinary
100.00
-
S2H Group Limited   *
England and Wales
Holding Company
Ordinary
100.00
-
Cocogreen UK Lanka (PVT) Ltd   * * *
Sri Lanka
Exporting of coco peat & related products
Ordinary
-
100.00
Coyelco (PVT) Ltd    * * * *
Sri Lanka
Processing of coco peat & related products
Ordinary
-
100.00
Cocogreen (UK) Ltd *
England and Wales
Importing of coir products
Ordinary
-
100.00
Cocogreen Retail Ltd *
England and Wales
Other retail sale of coir products
Ordinary
-
100.00
Nuja Transport (PVT) Ltd   * *
Sri Lanka
Dormant Company
Ordinary
-
100.00
COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
14
Subsidiaries
(Continued)
- 31 -

Registered office addresses (all UK unless otherwise indicated)

 

 

 

*    -    Lowry House Floor 12, Marble Street, Manchester, England, M2 3AW

* *    -    Nidella Estate, Kalugalla Road, Deegama, Nikadalupotha, Sri Lanka

* * *    -    Lot No 07, Delana Estate, Kuliyapitiya, Sri Lanka

* * * *    -    Wariyapola Road, Kolamunna, Katupotha, Sri Lanka

 

 

The subsidiary Nuja Transport (PVT) Limited is exempt from the requirement to prepare individual accounts by virtue of S394A CA 2006. The capital reserves of this company at the end of the period was nil. As Nuja Transport (PVT) Limited is dormant it has subsequently been eliminated from the consolidation as the company is immaterial.

15
Stocks
Group
Company
2022
2022
£
£
Finished goods and goods for resale
1,430,020
-
0
16
Debtors
Group
Company
2022
2022
Amounts falling due within one year:
£
£
Trade debtors
3,969,242
-
0
Amounts owed by group undertakings
-
2,508,794
Other debtors
1,587,913
15,001
Prepayments and accrued income
173,444
-
0
5,730,599
2,523,795

Included within other debtors is an amount of £122 in respect of amounts due from directors.

COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
- 32 -
17
Creditors: amounts falling due within one year
Group
Company
2022
2022
Notes
£
£
Bank loans and overdrafts
19
1,335,633
-
0
Obligations under finance leases
20
33,456
-
0
Trade creditors
470,378
-
0
Corporation tax payable
139,826
-
0
Other taxation and social security
376,394
-
Other creditors
2,406,404
700,000
Accruals and deferred income
788,048
222,800
5,550,139
922,800

Included in other creditors and bank loans and overdrafts is an amount of £1,915,284 owed in respect of invoice discounting and other borrowings that are secured by way of a fixed and floating charge over the assets of the company.

18
Creditors: amounts falling due after more than one year
Group
Company
2022
2022
Notes
£
£
Bank loans and overdrafts
19
1,662,998
-
0
Obligations under finance leases
20
46,078
-
0
1,709,076
-

Included in bank loans and overdrafts is an amount of £1,203,420 that is secured by way of a fixed and floating charge over the assets of the company.

19
Loans and overdrafts
Group
Company
2022
2022
£
£
Bank loans
2,563,867
-
0
Bank overdrafts
434,764
-
0
2,998,631
-
Payable within one year
1,335,633
-
0
Payable after one year
1,662,998
-
0

Included in bank loans and overdrafts are amounts that are secured by way of a fixed and floating charge over the assets of the company.

COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
- 33 -
20
Finance lease obligations
Group
Company
2022
2022
£
£
Future minimum lease payments due under finance leases:
Within one year
33,456
-
0
In two to five years
46,078
-
0
79,534
-

Finance lease payments represent rentals payable by the company or group for certain items of plant and machinery. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is between 3-5 years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.

21
Deferred taxation

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

Liabilities
2022
Group
£
Accelerated capital allowances
157,679
The company has no deferred tax assets or liabilities.
Group
Company
2022
2022
Movements in the period:
£
£
Asset at 1 December 2021
-
-
Charge to profit and loss account
157,679
-
Liability at 30 June 2022
157,679
-
COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
- 34 -
22
Retirement benefit schemes

The disclosures below relate to employee pension schemes of two subsidiary companies based in Sri Lanka. Having considered the nature and characteristics of the employee pension schemes, the directors are of the opinion that they do not represent defined benefit pension schemes for the purposes and definitions of FRS 102 Section 28 and have decided to include the disclosures as presented in the financial statements of Cocogreen UK Lanka (Pvt) Ltd and Coyelco (Pvt) Ltd.

 

Defined benefit schemes

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

2022
Group
£
Present value of defined benefit obligations
51,750
Deficit in scheme
51,750
The company had no post employment benefits at 30 June 2022.
Group
2022

Amounts recognised in the profit and loss account

£
Current service cost
15,434
Group
2022

Movements in the present value of defined benefit obligations

£
Liabilities at 1 December 2021
36,316
Current service cost
15,434
Group
2022

The defined benefit obligations arise from plans funded as follows:

£
Wholly unfunded obligations
(51,750)
Wholly or partly funded obligations
-
51,750
COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
22
Retirement benefit schemes
(Continued)
- 35 -

Other information

Gratuity is a defined benefit plan. The group is liable to pay gratuity in terms of the relevant statute. In order to meet this liability, a provision is carried forward in the balance sheet, equivalent to an amount calculated based on the gratuity formula method. The resulting difference between brought forward provision and carried forward provision is dealt with in the statement of comprehensive income.

 

The gratuity is not externally funded nor actuarially valued.

 

The gratuity liability is not externally funded.

23
Share capital
Group and company
2022
2022
Ordinary share capital
Number
£
Issued and fully paid
Ordinary shares of £1 each
12,446
12,446
24
Share premium account
Group
Company
2022
2022
£
£
At the beginning of the period
-
0
-
0
Issue of new shares
3,997,546
3,997,546
At the end of the period
3,997,546
3,997,546
25
Profit and loss reserves
Group
Company
2022
2022
£
£
At the beginning of the period
-
-
Loss for the period
(186,486)
(44,142)
At the end of the period
(186,486)
(44,142)
Other reserves
Other reserves consists of a currency translation reserve relating to overseas subsidiaries with a different presentational currency being revalued from local currency to GBP
COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
- 36 -
26
Operating lease commitments
Lessee

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

Group
Company
2022
2022
£
£
Within one year
34,460
-
In over five years
142,241
-
176,701
-
During the period operating lease payments were recognised as an expense in the profit and loss accounts amounting to £23,250.
27
Related party transactions
Transactions with related parties

The following amounts were outstanding at the reporting end date:

Amounts due to related parties
2022
£
Group
S2S Group PVT Ltd
700,000

The following amounts were outstanding at the reporting end date:

Amounts due from related parties
2022
Balance
£
Group
S2S Group PVT Ltd
1,237,627
COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
- 37 -
28
Cash absorbed by group operations
2022
£
Loss for the period after tax
(186,486)
Adjustments for:
Taxation charged
96,825
Finance costs
286,040
Investment income
(2,231)
Loss on disposal of tangible fixed assets
16,064
Amortisation and impairment of intangible assets
57,327
Depreciation and impairment of tangible fixed assets
72,946
Pension scheme non-cash movement
17,222
Movements in working capital:
Increase in stocks
(1,430,020)
Increase in debtors
(5,755,018)
Increase in creditors
4,039,435
Cash absorbed by operations
(2,787,896)
29
Cash absorbed by operations - company
2022
£
Loss for the period after tax
(44,142)
Movements in working capital:
Increase in debtors
(2,508,795)
Increase in creditors
922,800
Cash absorbed by operations
(1,630,137)
30
Analysis of changes in net debt - group
1 December 2021
Cash flows
Exchange rate movements
30 June 2022
£
£
£
£
Cash at bank and in hand
-
2,280,120
(967,446)
1,312,674
Bank overdrafts
-
(434,764)
-
(434,764)
-
1,845,356
(967,446)
877,910
Borrowings excluding overdrafts
-
(2,563,867)
-
(2,563,867)
Obligations under finance leases
-
(79,534)
-
(79,534)
-
(798,045)
(967,446)
(1,765,491)
COCOGREEN PROFESSIONAL SUBSTRATES LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
- 38 -
31
Analysis of changes in net funds - company
1 December 2021
Cash flows
30 June 2022
£
£
£
Cash at bank and in hand
-
723,951
723,951
32
Ultimate controlling party

In the opinion of the directors, as at 30th June 2022, the ultimate controlling parties are Mr S Fernando and Circularity GP I LLP, Acting in its capacity as general partner of Circularity European Growth Fund I LLP. These are ultimate controlling parties through their shareholding percentages.

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