Company registration number 07939436 (England and Wales)
Ellis Patents Holdings Limited
Annual Report and Financial Statements
For The Year Ended 28 February 2023
ELLIS PATENTS HOLDINGS LIMITED
COMPANY INFORMATION
Directors
Mr C J Calvert
Mr N R Foreman
Mr R M Lowish
Mr D Macfarlane
Mr M G Mullin
Mr R A Shaw
Mr J M Weaving
Secretary
Mrs D Holmes
Company number
07939436
Registered office
High Street
Rillington
Malton
YO17 8LA
Auditor
Azets Audit Services Limited
Triune Court
Monks Cross Drive
York
YO32 9GZ
ELLIS PATENTS HOLDINGS LIMITED
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3
Directors' responsibilities statement
4
Independent auditor's report
5 - 7
Group statement of comprehensive income
8
Group balance sheet
9
Company balance sheet
10
Group statement of changes in equity
11
Company statement of changes in equity
12
Group statement of cash flows
13
Notes to the financial statements
14 - 34
ELLIS PATENTS HOLDINGS LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 28 FEBRUARY 2023
- 1 -

The directors present the strategic report for the year ended 28 February 2023.

Fair review of the business

The principal activity of the Group is the design, manufacture and marketing of cable and pipe fixings.

 

The impact of Covid-19 was very much less apparent, although material prices and shipping prices remained high, easing somewhat later in the year.

 

The invasion of Ukraine had an impact on energy prices but the Group’s significant investment in solar panels went some way to mitigating these costs.

 

The Group’s activities have returned to normal and trading conditions have continued to improve.

Principal risks and uncertainties

The Group operates in a competitive commercial environment, which by its nature, presents risks and uncertainties. However, there are strategies in place to maintain and grow market share globally, whilst geographical coverage and market sector diversity ensure there is no overdependence on any particular territory or sector.

 

Principal risks also arise from financial aspects of doing business, and in particular related to financial instruments.

 

The Group’s principal financial instruments comprise cash, trade debtors and trade creditors which arise directly from its operations. The Group does not enter into derivative transactions and it is the Group’s policy that no trading in financial instruments be undertaken. The main risks arising from the Group’s financial instruments are commodity risk, credit risk and foreign exchange risk.

 

Commodity risk

Material prices and shipping prices were high at the beginning of the year but eased as the year progressed. The Group has continued to mitigate risk by holding stock.

 

Credit risk

The Group trades with recognised creditworthy third parties. Trade debtor balances are monitored on an ongoing basis with the result that the Group’s exposure to bad debts is not considered to be significant. The majority of trade debtors are insured.

 

Foreign exchange risk

As far as is practical the Group continued to mitigate foreign exchange risk using forward exchange contracts.

Key performance indicators

The directors consider the key performance indicators to be sales, gross profit, and cash.

 

Sales increased in the financial year by 22.4%, following an increase of 33.9% in the prior year. Gross profit (as a percentage of sales) has marginally reduced this year, from 45.3% to 44.3%. Cash levels have remained healthy throughout the year as a result of careful cash management.

 

Given the relatively straightforward nature of the Group’s operations, the directors do not believe there to be value in a more in-depth review of its KPIs.

 

The Group’s balance sheet as detailed on page 9 shows a satisfactory position with shareholders’ funds amounting to £7,736,329 (2022 £7,118,255).

ELLIS PATENTS HOLDINGS LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2023
- 2 -
Future developments

The Group continues to develop new products, explore new market sectors, and expand its global reach, and consequently the directors are confident about the future prospects of the Group.

By order of the board

Mrs D Holmes
Secretary
27 June 2023
ELLIS PATENTS HOLDINGS LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 28 FEBRUARY 2023
- 3 -

The directors present their annual report and financial statements for the year ended 28 February 2023.

Results and dividends

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

The profit for the year after taxation and the impact of revalutions of land buildings amounted to £1,431,456 (2022 - £1,176,016). Particulars of dividends paid are detailed in note 10 to the financial statements. The directors do not recommend payment of a final dividend.

Directors

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

Mr C J Calvert
Mr N R Foreman
Mr R M Lowish
Mr D Macfarlane
Mr M G Mullin
Mr R A Shaw
Mr J M Weaving
Mr N J Nightingale
(Resigned 12 July 2022)
Research and development

The group undertakes research and development activities to maintain competitive edge. The group continues to update and improve its existing products as well as developing new products and services that can be taken to market.

Auditor

The auditor, Azets Audit Services Limited, is deemed to be reappointed under section 487(2) of the Companies Act 2006.

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.

By order of the board
Mrs D Holmes
Secretary
27 June 2023
ELLIS PATENTS HOLDINGS LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 28 FEBRUARY 2023
- 4 -

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

 

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

 

 

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

ELLIS PATENTS HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF ELLIS PATENTS HOLDINGS LIMITED
- 5 -
Opinion

We have audited the financial statements of Ellis Patents Holdings Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 28 February 2023 which comprise the Group Statement of Comprehensive Income, the Group Balance Sheet, the Company Balance Sheet, the Group Statement of Changes in Equity, the Company Statement of Changes in Equity, the Group Statement of Cash Flows and 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 FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

Basis for opinion

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

Conclusions relating to going concern

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

 

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

 

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

Other information

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

 

We have nothing to report in this regard.

 

 

 

 

ELLIS PATENTS HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ELLIS PATENTS HOLDINGS LIMITED
- 6 -

Opinions on other matters prescribed by the Companies Act 2006

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

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the group and the parent company and their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report. We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

 

Responsibilities of directors

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

Auditor's responsibilities for the audit of the financial statements

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

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

ELLIS PATENTS HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ELLIS PATENTS HOLDINGS LIMITED
- 7 -

Extent to which the audit was considered capable of detecting irregularities, including fraud

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above and on the Financial Reporting Council’s website, to detect material misstatements in respect of irregularities, including fraud.

 

We obtain and update our understanding of the entity, its activities, its control environment, and likely future developments, including in relation to the legal and regulatory framework applicable and how the entity is complying with that framework.  Based on this understanding, we identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion.  This includes consideration of the risk of acts by the entity that were contrary to applicable laws and regulations, including fraud.

 

In response to the risk of irregularities and non-compliance with laws and regulations, including fraud, we designed procedures which included:

 

 

Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation.  This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance.  The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

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.

Alan Sidebottom (Senior Statutory Auditor)
For and on behalf of Azets Audit Services Limited
27 June 2023
Chartered Accountants
Statutory Auditor
Triune Court
Monks Cross Drive
York
YO32 9GZ
ELLIS PATENTS HOLDINGS LIMITED
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 28 FEBRUARY 2023
- 8 -
2023
2022
Notes
£
£
Turnover
3
9,200,095
7,518,062
Cost of sales
(5,127,376)
(4,109,324)
Gross profit
4,072,719
3,408,738
Distribution costs
(179,652)
(141,045)
Administrative expenses
(2,404,300)
(1,867,009)
Other operating income
13,550
15,600
Operating profit
4
1,502,317
1,416,284
Share of profits of associates
128,908
62,219
Interest receivable and similar income
7
13,174
423
Change in fair value of investment properties
8
100,000
-
Profit before taxation
1,744,399
1,478,926
Tax on profit
9
(281,977)
(302,910)
Profit for the financial year
1,462,422
1,176,016
Other comprehensive income
Revaluation of tangible fixed assets
(108,402)
-
0
Tax relating to other comprehensive income
77,436
-
0
Total comprehensive income for the year
1,431,456
1,176,016
Total comprehensive income for the year is all attributable to the owners of the parent company.

The group statement of comprehensive income has been prepared on the basis that all operations are continuing operations.

ELLIS PATENTS HOLDINGS LIMITED
GROUP BALANCE SHEET
AS AT
28 FEBRUARY 2023
28 February 2023
- 9 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
12
3,375,508
3,557,412
Investment properties
13
565,000
465,000
Investments
14
290,995
227,838
4,231,503
4,250,250
Current assets
Stocks
16
2,498,664
2,120,529
Debtors
17
1,837,752
1,614,420
Cash at bank and in hand
1,263,451
1,504,723
5,599,867
5,239,672
Creditors: amounts falling due within one year
18
(1,506,346)
(1,801,128)
Net current assets
4,093,521
3,438,544
Total assets less current liabilities
8,325,024
7,688,794
Creditors: amounts falling due after more than one year
19
(216,695)
(160,103)
Provisions for liabilities
Deferred tax liability
20
372,000
410,436
(372,000)
(410,436)
Net assets
7,736,329
7,118,255
Capital and reserves
Called up share capital
22
42,864
42,664
Share premium account
436,389
392,691
Revaluation reserve
523,932
554,898
Other reserves
121,865
121,865
Profit and loss reserves
6,611,279
6,006,137
Total equity
7,736,329
7,118,255
The financial statements were approved by the board of directors and authorised for issue on 27 June 2023 and are signed on its behalf by:
27 June 2023
Mr R A Shaw
Director
ELLIS PATENTS HOLDINGS LIMITED
COMPANY BALANCE SHEET
AS AT 28 FEBRUARY 2023
28 February 2023
- 10 -
2023
2022
Notes
£
£
£
£
Fixed assets
Intangible assets
11
1
1
Investment properties
13
2,021,500
2,135,764
Investments
14
444,602
400,704
2,466,103
2,536,469
Current assets
Debtors
17
-
0
124,913
Cash at bank and in hand
417,364
377,152
417,364
502,065
Creditors: amounts falling due within one year
18
(103,225)
(212,544)
Net current assets
314,139
289,521
Total assets less current liabilities
2,780,242
2,825,990
Provisions for liabilities
Deferred tax liability
20
122,000
173,436
(122,000)
(173,436)
Net assets
2,658,242
2,652,554
Capital and reserves
Called up share capital
22
42,864
42,664
Share premium account
436,389
392,691
Profit and loss reserves
2,178,989
2,217,199
Total equity
2,658,242
2,652,554

As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £819,070 (2022 - £583,978 ).

 

The financial statements were approved by the board of directors and authorised for issue on 27 June 2023 and are signed on its behalf by:
27 June 2023
Mr R A Shaw
Director
Company Registration No. 07939436
ELLIS PATENTS HOLDINGS LIMITED
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 28 FEBRUARY 2023
- 11 -
Share capital
Share premium account
Revaluation reserve
Other reserves
Profit and loss reserves
Total
Notes
£
£
£
£
£
£
Balance at 1 March 2021
42,664
392,691
554,898
121,865
5,512,745
6,624,863
Year ended 28 February 2022:
Profit and total comprehensive income for the year
-
-
-
-
1,176,016
1,176,016
Dividends
10
-
-
-
-
(682,624)
(682,624)
Balance at 28 February 2022
42,664
392,691
554,898
121,865
6,006,137
7,118,255
Year ended 28 February 2023:
Profit for the year
-
-
-
-
1,462,422
1,462,422
Other comprehensive income:
Revaluation of tangible fixed assets
-
-
(108,402)
-
-
(108,402)
Tax relating to other comprehensive income
-
-
77,436
-
-
0
77,436
Total comprehensive income for the year
-
-
(30,966)
-
1,462,422
1,431,456
Issue of share capital
22
200
-
0
-
-
-
200
Dividends
10
-
-
-
-
(857,280)
(857,280)
Other movements
-
43,698
-
-
-
43,698
Balance at 28 February 2023
42,864
436,389
523,932
121,865
6,611,279
7,736,329
ELLIS PATENTS HOLDINGS LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 28 FEBRUARY 2023
- 12 -
Share capital
Share premium account
Profit and loss reserves
Total
Notes
£
£
£
£
Balance at 1 March 2021
42,664
392,691
2,315,845
2,751,200
Year ended 28 February 2022:
Profit and total comprehensive income for the year
-
-
583,978
583,978
Dividends
10
-
-
(682,624)
(682,624)
Balance at 28 February 2022
42,664
392,691
2,217,199
2,652,554
Year ended 28 February 2023:
Profit and total comprehensive income for the year
-
-
819,070
819,070
Issue of share capital
22
200
-
0
-
200
Dividends
10
-
-
(857,280)
(857,280)
Other movements
-
43,698
-
43,698
Balance at 28 February 2023
42,864
436,389
2,178,989
2,658,242
ELLIS PATENTS HOLDINGS LIMITED
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 28 FEBRUARY 2023
- 13 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
30
1,145,656
1,463,324
Income taxes paid
(168,770)
(51,624)
Net cash inflow from operating activities
976,886
1,411,700
Investing activities
Purchase of tangible fixed assets
(298,424)
(287,983)
Proceeds on disposal of tangible fixed assets
2,021
5,290
Receipts from associates
65,751
57,783
Interest received
13,174
423
Net cash used in investing activities
(217,478)
(224,487)
Financing activities
Dividends paid to equity shareholders
(1,000,680)
(538,624)
Net cash used in financing activities
(1,000,680)
(538,624)
Net (decrease)/increase in cash and cash equivalents
(241,272)
648,589
Cash and cash equivalents at beginning of year
1,504,723
856,134
Cash and cash equivalents at end of year
1,263,451
1,504,723
ELLIS PATENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 28 FEBRUARY 2023
- 14 -
1
Accounting policies
Company information

Ellis Patents Holdings Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is High Street, Rillington, Malton, YO17 8LA.

 

The group consists of Ellis Patents Holdings Limited and all of its subsidiaries.

1.1
Accounting convention

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

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £1.

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

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

 

 

The company has taken advantage of the disclosure exemptions of Section 33.1A of FRS 102 which permit it to not present details of its transactions with members of the group headed by Ellis Patents Holdings Limited where relevant group companies are all wholly owned. Details of outstanding balances as at the year end are given in notes 17 and 18.

1.2
Basis of consolidation

The Group has applied the principles of merger accounting in consolidating the results. Merger accounting requires that the results of the Group are presented as if the Group has always been in its present form, and does not require a re-evaluation of fair values as at the point of acquisition. Accordingly, a merger reserve has been created which represents the difference between the net assets of the Group as at the date of its creation, and the retained profits recognised by the Group as at that date.

ELLIS PATENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2023
1
Accounting policies
(Continued)
- 15 -

The consolidated financial statements incorporate those of Ellis Patents Holdings Limited and all of its subsidiaries (ie entities that the group controls through its power to govern the financial and operating policies so as to obtain economic benefits). Subsidiaries acquired during the year are consolidated using the purchase method. Their results are incorporated from the date that control passes.

 

All financial statements are made up to 28 February 2023. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.

 

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

1.3
Going concern

The directors have considered all factors, including in the wider economy, as part of their assessment of going concern. Although the current economic climate creates both cashflow and profitability risks for the group, the group continues to trade profitably and is cash generative. Budgets and cashflows have been prepared using assumptions for customer demand and supply chain costs as well as expectations for legal and regulatory environmental impacts. These budgets and cashflows indicate continuing profitability and cash generation, consequently the directors believe on balance that they have sufficient resources to enable trading to continue for a period of at least one year from the date of approval of the financial statements. Accordingly, these financial statements have been prepared on the going concern basis.

1.4
Turnover

Turnover represents amounts invoiced for goods despatched and services rendered during the year, net of VAT and trade discounts.

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), 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.

1.5
Research and development expenditure

Research and development expenditure is written off against profits in the year in which it is incurred.

1.6
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.

Intangible assets represent separable items of software purchased to facilitate non-production activities. These are amortised on a straight line basis over 5 years, being their estimated useful life.

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:

Software
5 years straight line
Patents
Over the expected useful life of the development
1.7
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. Freehold land and buildings are subsequently revalued to fair value on a periodic basis, with any unrealised profits taken to the revaluation reserve. Details of revaluations are given in note 12.

ELLIS PATENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2023
1
Accounting policies
(Continued)
- 16 -

Freehold land is not depreciated. For all other assets, depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Freehold buildings
50 years straight line
Plant and machinery
5 - 10 years straight line
Fixtures, fittings and equipment
10 years straight line
Tooling
10 years straight line

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.

1.8
Investment properties

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

1.9
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.

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

 

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

 

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

1.10
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.

ELLIS PATENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2023
1
Accounting policies
(Continued)
- 17 -

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 is estimated to be less than its carrying amount, the carrying amount of the asset 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 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 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.

1.11
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 are costed on an activity based costing model, with absorption of directly incurred overheads.

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.

1.12
Cash at bank and in hand

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

1.13
Financial instruments

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

 

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

 

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

Basic financial assets

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

ELLIS PATENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2023
1
Accounting policies
(Continued)
- 18 -
Other financial assets

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

Impairment of financial assets

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

 

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

 

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

Derecognition of financial assets

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

Classification of financial liabilities

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

Basic financial liabilities

Basic financial liabilities, including creditors, bank loans, and loans from fellow group companies, 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.

ELLIS PATENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2023
1
Accounting policies
(Continued)
- 19 -
Other financial liabilities

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

 

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

Derecognition of financial liabilities

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

1.14
Equity instruments

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

1.15
Taxation

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

Current tax

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

Deferred tax

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

 

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

ELLIS PATENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2023
1
Accounting policies
(Continued)
- 20 -
1.16
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.

 

The Group operates a Senior Employee Bonus Scheme whereby a discretionary allocation of points is made each year by the shareholders, with the value of each point linked to the underlying share valuation of the Group. Members of the Scheme can only recognise the value after a vesting period, but after the vesting period those Members have the right to take settlement of the value in cash as at that date. At each balance sheet date the estimated present value of the Group's obligations under the Scheme is provided for as a liability, with the movement from the prior year's present value recognised as a movement in profit or loss.

1.17
Retirement benefits

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

1.18
Share-based payments

The fair value of equity-settled share based payments to employees is determined at the date of grant and is expensed on a straight-line basis over the vesting period based on the company's estimate of shares or options that will eventually vest. Where the date of grant and issue of shares is on the same date, amounts are recognised as an immediate expense to the profit and loss account as measured by reference to the fair value of shares provided to recipients.

1.19
Leases

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term.

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

1.20
Foreign exchange

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

2
Judgements and key sources of estimation uncertainty

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

 

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

ELLIS PATENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2023
2
Judgements and key sources of estimation uncertainty
(Continued)
- 21 -
Key sources of estimation uncertainty

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

Tooling expenditure

As part of its manufacturing process, the Group incurs expenditure on creating its own tooling for use in the primary trade; this expenditure is capitalised as a fixed asset and depreciated over 10 years.

 

The cost is determined by reference to the direct time incurred on each tool item, with the cost per hour calculated using a total cost formula, updated on an annual basis. The useful life is determined using management's expectation of the period of use of each tool using their experience of the renewal period of similar tools.

Investment properties

The Group and Company hold investment properties and land & buildings at their fair value, which approximates to the open market value on an existing use basis. The Group and Company obtain regular professional valuations to determine these estimates, with the last professional valuation being obtained for the year ended 28 February 2023.

Senior Employee Bonus Scheme

The Group operates a long term bonus scheme for a number of its primary management personnel. This is calculated by a discretionary allocation of points each year under the control of the shareholders, with these points being multiplied by an estimated market value for the Group. The total provision is scheduled in note 18.

3
Turnover

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

2023
2022
£
£
Turnover analysed by class of business
Sale of goods
9,055,926
7,401,721
Sundry and scrap sales
35,493
27,062
Carriage income
108,676
89,279
9,200,095
7,518,062
2023
2022
£
£
Turnover analysed by geographical market
UK
5,835,521
3,943,889
Europe but not in the EU
732,972
301,855
EU member states
724,013
948,392
Rest of the World
1,907,589
2,323,926
9,200,095
7,518,062
ELLIS PATENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2023
- 22 -
4
Operating profit
2023
2022
£
£
Operating profit for the year is stated after charging/(crediting):
Exchange losses
26,407
9,477
Research and development costs
53,220
45,385
Depreciation of owned tangible fixed assets
371,926
376,180
Profit on disposal of tangible fixed assets
(2,021)
(4,475)
Amortisation of intangible assets
-
744
Share-based payments
43,898
-
Operating lease charges
33,296
33,296
5
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the group and company
2,650
2,400
Audit of the financial statements of the company's subsidiaries
13,300
11,100
15,950
13,500
6
Employees

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

Group
Company
2023
2022
2023
2022
Number
Number
Number
Number
Office and management
25
26
7
8
Manufacturing
43
40
-
-
68
66
7
8

Their aggregate remuneration comprised:

Group
Company
2023
2022
2023
2022
£
£
£
£
Wages and salaries
2,362,593
1,998,967
30,544
30,664
Social security costs
231,361
170,446
2,078
-
Pension costs
228,541
204,129
-
0
-
0
2,822,495
2,373,542
32,622
30,664
ELLIS PATENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2023
- 23 -
7
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
13,174
423
8
Fair value gains
2023
2022
£
£
Changes in the fair value of investment properties
100,000
-
9
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
312,000
260,000
Adjustments in respect of prior periods
(69,023)
(25,583)
Total current tax
242,977
234,417
Deferred tax
Origination and reversal of timing differences
39,000
(2,275)
Changes in tax rates
-
0
70,768
Total deferred tax
39,000
68,493
Total tax charge
281,977
302,910
ELLIS PATENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2023
9
Taxation
(Continued)
- 24 -

The charge for the year can be reconciled to the profit per the profit and loss account as follows:

2023
2022
£
£
Profit before taxation
1,744,399
1,478,926
Expected tax charge based on the standard rate of corporation tax in the UK of 19.00% (2022: 19.00%)
331,436
280,996
Tax effect of expenses that are not deductible in determining taxable profit
8,341
-
0
Tax effect of income not taxable in determining taxable profit
118
-
0
Effect of change in corporation tax rate
-
70,768
Depreciation on assets not qualifying for tax allowances
404
522
Under/(over) provided in prior years
(69,023)
(25,583)
R&D tax credits and Patent Box relief
-
0
(18,512)
Capitalised revenue
(236)
(118)
Other tax adjustments
10,937
1,167
Share of associated profits
-
(6,330)
Taxation charge
281,977
302,910

In addition to the amount charged to the profit and loss account, the following amounts relating to tax have been recognised directly in other comprehensive income:

2023
2022
£
£
Deferred tax arising on:
Revaluation of property
(77,436)
-
10
Dividends
2023
2022
Recognised as distributions to equity holders:
£
£
Interim paid
857,280
682,624

Equity dividends paid on ordinary shares amounted to £20.00 (2022 - £16.00) per share.

ELLIS PATENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2023
- 25 -
11
Intangible fixed assets
Group
Software
£
Cost
At 1 March 2022 and 28 February 2023
11,516
Amortisation and impairment
At 1 March 2022 and 28 February 2023
11,516
Carrying amount
At 28 February 2023
-
0
At 28 February 2022
-
0
Company
Patents
£
Cost
At 1 March 2022 and 28 February 2023
1
Amortisation and impairment
At 1 March 2022 and 28 February 2023
-
0
Carrying amount
At 28 February 2023
1
At 28 February 2022
1
ELLIS PATENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2023
- 26 -
12
Tangible fixed assets
Group
Freehold buildings
Plant and machinery
Fixtures, fittings and equipment
Tooling
Total
£
£
£
£
£
Cost or valuation
At 1 March 2022
2,135,764
2,520,337
276,223
3,486,679
8,419,003
Additions
94,150
142,803
14,582
46,889
298,424
Disposals
-
0
(8,405)
-
0
-
0
(8,405)
Revaluation
(208,414)
-
0
-
0
-
0
(208,414)
At 28 February 2023
2,021,500
2,654,735
290,805
3,533,568
8,500,608
Depreciation and impairment
At 1 March 2022
71,107
1,910,790
182,183
2,697,511
4,861,591
Depreciation charged in the year
28,905
148,416
17,307
177,298
371,926
Eliminated in respect of disposals
-
0
(8,405)
-
0
-
0
(8,405)
Revaluation
(100,012)
-
0
-
0
-
0
(100,012)
At 28 February 2023
-
0
2,050,801
199,490
2,874,809
5,125,100
Carrying amount
At 28 February 2023
2,021,500
603,934
91,315
658,759
3,375,508
At 28 February 2022
2,064,657
609,547
94,040
789,168
3,557,412
The company had no tangible fixed assets at 28 February 2023 or 28 February 2022.

The carrying value of land is:

Group
Company
2023
2022
2023
2022
£
£
£
£
Freehold
831,500
690,500
-
0
-
0

Freehold land and buildings represents premises used by the subsidiary company, Ellis Patents Limited, under an operating lease arrangement, with the group electing to revalue these sites to fair value with any gains taken through other comprehensive income to the revaluation reserve. The investment property was revalued on 10 May 2023 by Lawrence Hannah Property and Construction Consultants, on the basis of its open market value for continued use, which is believed by the directors to be equivalent to its fair value. The directors believe this valuation fairly presents the value as at the balance sheet date.

If revalued assets were stated on a historical cost basis rather than a fair value basis, the total amounts included would have been as follows:

ELLIS PATENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2023
12
Tangible fixed assets
(Continued)
- 27 -
2023
2022
£
£
Group
Cost
2,477,658
2,383,508
Accumulated depreciation
(493,188)
(448,681)
Carrying value
1,984,470
1,934,827
13
Investment property
Group
Company
2023
2023
£
£
Fair value
At 1 March 2022
465,000
2,135,764
Additions through external acquisition
-
94,150
Net gains or losses through fair value adjustments
100,000
(208,414)
At 28 February 2023
565,000
2,021,500

The investment property was revalued on 10 May 2023 by Lawrence Hannah Property and Construction Consultants, on the basis of its open market value for continued use, which is believed by the directors to be equivalent to its fair value. The directors believe this valuation fairly presents the value as at the balance sheet date.

If investment properties were stated on an historical cost basis rather than a fair value basis, the amounts would have been included as follows:
Group
Company
2023
2022
2023
2022
£
£
£
£
Cost
266,689
266,689
2,477,658
2,383,508
Accumulated depreciation
(60,625)
(55,468)
(495,071)
(448,681)
Carrying amount
206,064
211,221
1,982,587
1,934,827

The carrying value of land within investment properties is:

Group
Company
2023
2022
2023
2022
£
£
£
£
Freehold
142,000
117,000
831,500
690,500
ELLIS PATENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2023
- 28 -
14
Fixed asset investments
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Investments in subsidiaries
27
-
0
-
0
40,129
40,129
Investments in associates
28
290,995
227,838
208,949
208,949
Other investments
-
0
-
0
195,524
151,626
290,995
227,838
444,602
400,704
Movements in fixed asset investments
Group
Shares in associates
£
Cost or valuation
At 1 March 2022
227,838
Share of profits
137,833
Amortisation of goodwill
(8,925)
Dividends received
(65,751)
At 28 February 2023
290,995
Carrying amount
At 28 February 2023
290,995
At 28 February 2022
227,838
Movements in fixed asset investments
Company
Shares in subsidiaries and associates
Other
Total
£
£
£
Cost or valuation
At 1 March 2022
249,078
151,626
400,704
Share based payment expensed in subsidiary
-
43,898
43,898
At 28 February 2023
249,078
195,524
444,602
Carrying amount
At 28 February 2023
249,078
195,524
444,602
At 28 February 2022
249,078
151,626
400,704
ELLIS PATENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2023
- 29 -
15
Financial instruments
Group
Company
2023
2022
2023
2022
£
£
£
£
Carrying amount of financial liabilities
Measured at fair value through profit or loss
- Other financial liabilities
288,803
221,560
-
-
16
Stocks
Group
Company
2023
2022
2023
2022
£
£
£
£
Raw materials and consumables
1,398,754
1,037,951
-
-
Work in progress
434,918
463,475
-
-
Finished goods and goods for resale
664,992
619,103
-
0
-
0
2,498,664
2,120,529
-
-
17
Debtors
Group
Company
2023
2022
2023
2022
Amounts falling due within one year:
£
£
£
£
Trade debtors
1,733,746
1,511,741
-
0
-
0
Amounts owed by group undertakings
-
-
-
124,913
Prepayments and accrued income
104,006
102,679
-
0
-
0
1,837,752
1,614,420
-
124,913
18
Creditors: amounts falling due within one year
Group
Company
2023
2022
2023
2022
£
£
£
£
Trade creditors
409,525
555,618
-
0
-
0
Amounts owed to group undertakings
-
0
-
0
12,450
-
0
Corporation tax payable
312,000
237,793
77,000
61,293
Other taxation and social security
177,975
169,828
-
-
Dividends payable
600
144,000
600
144,000
Accruals and deferred income
606,246
693,889
13,175
7,251
1,506,346
1,801,128
103,225
212,544
ELLIS PATENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2023
- 30 -
19
Creditors: amounts falling due after more than one year
Group
Company
2023
2022
2023
2022
£
£
£
£
Senior employee bonus scheme
216,695
160,103
-
0
-
0

The long term creditor represents a provision for amounts due under the Group's Senior Employee Bonus Scheme, as detailed in note 2. Amounts accrued which fall due within one year are included within note 18 in accruals and deferred income, and amount to £72,109 (2022 - £61,457).

20
Deferred taxation

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

Liabilities
Liabilities
2023
2022
Group
£
£
Accelerated capital allowances
395,000
355,909
Senior employee bonus scheme
(73,000)
(49,000)
Revaluations
50,000
103,527
372,000
410,436
Liabilities
Liabilities
2023
2022
Company
£
£
Accelerated capital allowances
122,000
96,000
Revaluations
-
77,436
122,000
173,436
Group
Company
2023
2023
Movements in the year:
£
£
Liability at 1 March 2022
410,436
173,436
Charge to profit or loss / other comprehensive income
(38,436)
(51,436)
Liability at 28 February 2023
372,000
122,000

Deferred taxation balances are not expected to substantially unwind within the next 12 months.

 

ELLIS PATENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2023
- 31 -
21
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
228,541
204,129

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

22
Share capital
Group and company
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary voting of £1 each
40,864
40,664
40,864
40,664
Ordinary non-voting of £1 each
2,000
2,000
2,000
2,000
42,864
42,664
42,864
42,664

Each ordinary voting share is entitled to one vote, and carries rights to any discretionary dividend payments but no rights to fixed income. Each ordinary voting share carries equal rights to any capital distributions made.

 

Each ordinary non-voting share carries equal rights to any capital distributions made.

23
Operating lease commitments

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

Group
Company
2023
2022
2023
2022
£
£
£
£
Within one year
39,053
26,992
-
-
Between two and five years
51,930
13,806
-
-
90,983
40,798
-
-
ELLIS PATENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2023
- 32 -
24
Related party transactions
Transactions with related parties

During the year the group entered into the following transactions with related parties:

Sales
Sales
2023
2022
£
£
Group
Other related parties
594,540
284,411
Dividends
2023
2022
£
£
Company
Other related parties
65,751
57,783

The following amounts were outstanding at the reporting end date:

Amounts due from related parties
2023
2022
Balance
Balance
£
£
Group
Other related parties
76,726
25,010
25
Directors' transactions

Dividends totalling £316,656 (2022 - £210,448) were paid in the year in respect of shares held by the company's directors and, where relevant, their pension schemes.

26
Controlling party

The directors are of the opinion that there is no ultimate controlling party.

27
Subsidiaries

Details of the company's subsidiaries at 28 February 2023 are as follows:

Name of undertaking
Registered
Nature of business
Class of
% Held
office
shares held
Direct
Indirect
Ellis Patents Limited
England and Wales
Manufacturing
Ordinary
100.00
0

The registered office of Ellis Patents Limited is the same as the registered office of Ellis Patents Holdings Limited.

ELLIS PATENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2023
- 33 -
28
Associates

Details of associates at 28 February 2023 are as follows:

Name of undertaking
Registered office
Class of
% Held
shares held
Direct
Procab A.S
Kobbervikdalen 61, 3036 Drammen, Norway
Ordinary
20
29
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
432,082
324,091
Company pension contributions to defined contribution schemes
27,454
25,436
459,536
349,527
The number of directors for whom retirement benefits are accruing under defined benefit schemes amounted to 1 (2022 - 1).
Remuneration disclosed above includes the following amounts paid to the highest paid director:
2023
2022
£
£
Remuneration for qualifying services
231,701
114,468
Company pension contributions to defined contribution schemes
27,454
25,436
ELLIS PATENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2023
- 34 -
30
Cash generated from group operations
2023
2022
£
£
Profit for the year after tax
1,462,422
1,176,016
Adjustments for:
Share of results of associates and joint ventures
(128,908)
(62,219)
Taxation charged
281,977
302,910
Investment income
(13,174)
(423)
Gain on disposal of tangible fixed assets
(2,021)
(4,475)
Fair value gain on investment properties
(100,000)
-
0
Amortisation and impairment of intangible assets
-
744
Depreciation and impairment of tangible fixed assets
371,926
376,180
Equity settled share based payment expense
43,898
-
Movements in working capital:
Increase in stocks
(378,135)
(794,724)
Increase in debtors
(223,332)
(408,900)
(Decrease)/increase in creditors
(168,997)
878,215
Cash generated from operations
1,145,656
1,463,324
31
Analysis of changes in net funds - group
1 March 2022
Cash flows
28 February 2023
£
£
£
Cash at bank and in hand
1,504,723
(241,272)
1,263,451
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