Company registration number 00210739 (England and Wales)
BEN BENNETT JR LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
BEN BENNETT JR LIMITED
COMPANY INFORMATION
Directors
Ms J Bennett
Mrs N Bennett
Mr D Barks
Mr B Bennett
Secretary
Mr I Wingfield
Company number
00210739
Registered office
Danecourt
Lisle Road
Rotherham
S60 2RL
Auditor
BHP LLP
2 Rutland Park
Sheffield
S 10 2PD
Bankers
HSBC
35 College Street
Rotherham
South Yorkshire
S65 1AF
BEN BENNETT JR LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2 - 3
Independent auditor's report
4 - 6
Profit and loss account
7
Balance sheet
8
Statement of changes in equity
9
Statement of cash flows
10
Notes to the financial statements
11 - 25
BEN BENNETT JR LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022
- 1 -
The directors present the strategic report for the year ended 31 December 2022.
Fair review of the business
We aim to present a balanced and comprehensive review of the developments and performance of our business during the year and its position at the year-end. Our review is consistent with the size and non-complex nature of our medium sized business and is written in the context of the risks and uncertainties we face.
The Company is split into two main divisions plus the smaller UK Blade division:
Grange Mill Quarry – high purity limestone in lumps and powders
Eastwood Rolling Mills – production of cold rolled mild, carbon and hardened and tempered steel strip
UK Blade – manufacture of small hacksaws.
We consider that our key financial performance indicators are those that communicate the financial performance and strength of the Company as a whole, these being turnover, movements in operating profit and net profits after tax.
Movements in turnovers of the various activities of the Company were as follows:
Sales of limestone products +22.9%
Sales of steel strip +26.0%
Sales of small hacksaws +3.3%
We continue to invest in our operations, with capital expenditure of £1,460,934 during 2022.
The operating profit has increased to £1,757,456 in 2022 from £1,196,952 in 2021 (+46.9%). Profit before taxation is down £29,871 due to adverse movements in our investments in listed securities.
Development and performance
During 2022 we experienced, like many companies, significant inflationary pressures. This impacted on our Gross Profit, which although higher by £594,289 showed a decrease as a percentage of sales from 38.9% in 2021 to 36.2% in 2022, as we absorbed some of the cost increases.
As we progress into 2023, the steel industry is very weak across the whole sector, however the limestone side of the business remains steady and comparable to 2022.
Ms J Bennett
Director
8 November 2023
BEN BENNETT JR LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022
- 2 -
The directors present their report and financial statements for the year ended 31 December 2022.
Principal activities
The principal activity of the company continued to be that of quarrying of limestone, the manufacture of cold rolled and hardened and tempered steel strip and the manufacture of small hacksaws.
Results and dividends
The results for the year are set out on page 7.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
Ms J Bennett
Mrs N Bennett
Mr D Barks
Mr B Bennett
Mr A Rawson
(Resigned 30 June 2022)
Auditor
The auditor, BHP LLP, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
Statement of directors' responsibilities
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 company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the 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 company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
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 company’s auditor 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 company’s auditor is aware of that information.
BEN BENNETT JR LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 3 -
On behalf of the board
Ms J Bennett
Director
8 November 2023
BEN BENNETT JR LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF BEN BENNETT JR LIMITED
- 4 -
Opinion
We have audited the financial statements of Ben Bennett Jr Limited (the 'company') for the year ended 31 December 2022 which comprise the profit and loss account, 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).
In our opinion the financial statements:
give a true and fair view of the state of the company's affairs as at 31 December 2022 and of its profit for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.
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 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 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.
The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit:
the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
BEN BENNETT JR LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF BEN BENNETT JR LIMITED
- 5 -
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its 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:
adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors' responsibilities statement, 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 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 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.
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
Through discussion with management and inspection of documentation, we have gained an understanding of the specific laws and regulations which govern Ben Bennett Jr. Limited. Through the use of suitably experienced audit staff, with prior knowledge of the client and their industry we were able to adequately assess the company’s fraud risk. There are inherent limitations in the audit procedures described and, the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements the less likely we would become aware of it.
We designed audit procedures to respond to the risk, recognising that the risk of not detecting material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion. A review of expenditure has taken place to ensure that this does not display any evidence of legal proceedings against the company which have not otherwise been disclosed to the auditor. As the company operates in the quarry industry, accident reports have been reviewed alongside any correspondence with the Health and Safety Executive. We have also reviewed minutes of the management team's meetings to identify any irregularities.
We have also addressed the risk of management override of internal controls, including journals testing and a review of the nominal ledger, aided by audit technology. We were able to assess whether there was any evidence of management bias in the financial statements which may represent a risk of material misstatement due to fraud.
Audit work was performed in a timely manner shortly after the year end to allow appropriate evidence to be obtained.
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.
BEN BENNETT JR LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF BEN BENNETT JR LIMITED
- 6 -
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.
Daniel Varley
Senior Statutory Auditor
For and on behalf of BHP LLP
15 November 2023
Chartered Accountants
Statutory Auditor
2 Rutland Park
Sheffield
S 10 2PD
BEN BENNETT JR LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2022
- 7 -
2022
2021
as restated
Notes
£
£
Turnover
3
12,799,514
10,365,734
Cost of sales
(8,163,895)
(6,482,759)
Gross profit
4,635,619
3,882,975
Administrative expenses
(3,226,540)
(2,743,908)
Other operating income
73,194
57,885
Operating profit
4
1,482,273
1,196,952
Interest receivable and similar income
7
53,346
93,419
Change in fair value investments
(315,970)
234,332
Profit before taxation
1,219,649
1,524,703
Tax on profit
8
(592,630)
(410,000)
Profit for the financial year
627,019
1,114,703
The profit and loss account has been prepared on the basis that all operations are continuing operations.
BEN BENNETT JR LIMITED
BALANCE SHEET
AS AT 31 DECEMBER 2022
31 December 2022
- 8 -
2022
2021
as restated
Notes
£
£
£
£
Fixed assets
Goodwill
10
6,464
Other intangible assets
10
488,469
514,833
Total intangible assets
488,469
521,297
Tangible assets
11
5,231,601
4,941,710
Investments
12
2,510,682
2,697,319
8,230,752
8,160,326
Current assets
Stocks
14
575,401
394,720
Debtors
15
3,130,239
2,830,450
Cash at bank and in hand
3,198,827
2,497,545
6,904,467
5,722,715
Creditors: amounts falling due within one year
16
(2,116,055)
(2,007,896)
Net current assets
4,788,412
3,714,819
Total assets less current liabilities
13,019,164
11,875,145
Provisions for liabilities
Deferred tax liability
17
1,475,000
958,000
(1,475,000)
(958,000)
Net assets
11,544,164
10,917,145
Capital and reserves
Called up share capital
19
18,990
18,990
Capital redemption reserve
6,010
6,010
Profit and loss reserves
11,519,164
10,892,145
Total equity
11,544,164
10,917,145
The financial statements were approved by the board of directors and authorised for issue on 8 November 2023 and are signed on its behalf by:
Ms J Bennett
Director
Company Registration No. 00210739
BEN BENNETT JR LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2022
- 9 -
Share capital
Capital redemption reserve
Profit and loss reserves
Total
Notes
£
£
£
£
As restated for the period ended 31 December 2021:
Balance at 1 January 2021
18,995
6,005
10,230,431
10,255,431
Year ended 31 December 2021:
Profit and total comprehensive income for the year
-
-
1,114,703
1,114,703
Dividends
9
-
-
(452,984)
(452,984)
Redemption of shares
19
5
5
Reduction of shares
19
(5)
-
(5)
(10)
Balance at 31 December 2021
18,990
6,010
10,892,145
10,917,145
Year ended 31 December 2022:
Profit and total comprehensive income for the year
-
-
627,019
627,019
Balance at 31 December 2022
18,990
6,010
11,519,164
11,544,164
BEN BENNETT JR LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2022
- 10 -
2022
2021
as restated
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
24
1,888,553
1,456,015
Income taxes paid
(89,229)
(82,893)
Net cash inflow from operating activities
1,799,324
1,373,122
Investing activities
Purchase of tangible fixed assets
(1,460,934)
(1,242,270)
Proceeds from disposal of tangible fixed assets
438,879
346,000
Net movements on investments
(129,333)
(66,529)
Interest received
26,968
2,794
Dividends received
30,872
26,435
(Losses)/gains on investments
(4,494)
64,190
Net cash used in investing activities
(1,098,042)
(869,380)
Financing activities
Redemption of shares
(5)
Dividends paid
(452,984)
Net cash used in financing activities
-
(452,989)
Net increase in cash and cash equivalents
701,282
50,753
Cash and cash equivalents at beginning of year
2,497,545
2,446,792
Cash and cash equivalents at end of year
3,198,827
2,497,545
BEN BENNETT JR LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
- 11 -
1
Accounting policies
Company information
Ben Bennett Jr Limited is a private company limited by shares incorporated in England and Wales. The registered office is Danecourt, Lisle Road, Rotherham, S60 2RL.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
1.2
Going concern
Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
1.3
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.
1.4
Intangible fixed assets - goodwill
Goodwill represents the excess of the cost of acquisition of unincorporated businesses 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.
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.
1.5
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 acquired on business combinations are recognised separately from goodwill at the acquisition date where it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the fair value of the asset can be measured reliably; the intangible asset arises from contractual or other legal rights; and the intangible asset is separable from the entity.
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:
Mineral Rights
5% straight line
BEN BENNETT JR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 12 -
1.6
Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Freehold land and buildings
10% reducing balance
Plant and machinery
10% to 30% reducing balance
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
1.7
Fixed asset investments
Interests in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.
A subsidiary is an entity controlled by the company. 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 company considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.
Entities in which the company has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.
1.8
Impairment of fixed assets
At each reporting period end date, the company 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.
Intangible assets with indefinite useful lives and intangible assets not yet available for use are tested for impairment annually, and wherever there is an indication that the asset may be impaired.
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.
BEN BENNETT JR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 13 -
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
1.9
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.
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.
1.10
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.11
Financial instruments
The company 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 company's balance sheet when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Other financial assets
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
BEN BENNETT JR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 14 -
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 company 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 company after deducting all of its liabilities.
Basic financial liabilities
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Other financial liabilities
Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
BEN BENNETT JR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 15 -
1.12
Equity instruments
Equity instruments issued by the company 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 company.
1.13
Derivatives
Derivatives are initially recognised at fair value at the date a derivative contract is entered into and are subsequently remeasured to fair value at each reporting end date. The resulting gain or loss is recognised in profit or loss immediately unless the derivative is designated and effective as a hedging instrument, in which event the timing of the recognition in profit or loss depends on the nature of the hedge relationship.
A derivative with a positive fair value is recognised as a financial asset, whereas a derivative with a negative fair value is recognised as a financial liability.
1.14
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’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 when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
1.15
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
1.16
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
BEN BENNETT JR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 16 -
1.17
Government grants
Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.
A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.
1.18
Foreign exchange
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.
2
Judgements and key sources of estimation uncertainty
In the application of the company’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.
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.
Useful economic life of assets
The Directors have used their knowledge of the business to estimate the useful economic life of the assets held by the business.
3
Turnover and other revenue
An analysis of the company's turnover is as follows:
2022
2021
£
£
Turnover
Limestone quarrying
9,412,758
7,654,059
Cold rolled steel strip
3,204,785
2,535,862
Blade manufacture
181,971
175,814
12,799,514
10,365,734
BEN BENNETT JR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
3
Turnover and other revenue
(Continued)
- 17 -
Other revenue
Interest income
26,968
2,794
Royalty income
53,894
Dividends received
30,872
26,435
Grants received
-
39,090
Turnover analysed by geographical market
2022
2021
£
£
United Kingdom
12,712,156
10,276,925
Exports
87,358
88,809
12,799,514
10,365,734
4
Operating profit
2022
2021
Operating profit for the year is stated after charging/(crediting):
£
£
Government grants
-
(39,090)
Fees payable to the company's auditor for the audit of the company's financial statements
18,000
18,300
Depreciation of owned tangible fixed assets
866,880
819,342
Profit on disposal of tangible fixed assets
(134,716)
(81,544)
Amortisation of intangible assets
32,828
30,870
5
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2022
2021
Number
Number
Limestone quarrying
40
41
Cold rolled steel strip
13
13
Blade manufacture
3
3
Head office
10
11
Total
66
68
BEN BENNETT JR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
5
Employees
(Continued)
- 18 -
Their aggregate remuneration comprised:
2022
2021
£
£
Wages and salaries
2,848,718
2,616,792
Social security costs
317,880
276,119
Pension costs
145,842
150,124
3,312,440
3,043,035
6
Directors' remuneration
2022
2021
£
£
Remuneration for qualifying services
593,009
435,622
Company pension contributions to defined contribution schemes
32,807
19,909
625,816
455,531
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 4 (2021 - 5).
Remuneration disclosed above include the following amounts paid to the highest paid director:
2022
2021
£
£
Remuneration for qualifying services
110,157
117,847
7
Interest receivable and similar income
2022
2021
£
£
Interest income
Interest on bank deposits
26,968
2,794
Other income from investments
Dividends received
30,872
26,435
57,840
29,229
Income from fixed asset investments
(Losses)/gains on investments
(4,494)
64,190
Total income
53,346
93,419
BEN BENNETT JR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
7
Interest receivable and similar income
(Continued)
- 19 -
Investment income includes the following:
Interest on financial assets not measured at fair value through profit or loss
26,968
2,794
Dividends from financial assets measured at fair value through profit or loss
30,872
26,435
8
Taxation
2022
2021
£
£
Current tax
UK corporation tax on profits for the current period
75,400
89,000
Adjustments in respect of prior periods
230
Total current tax
75,630
89,000
Deferred tax
Origination and reversal of timing differences
517,000
321,000
Total tax charge
592,630
410,000
The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:
2022
2021
£
£
Profit before taxation
1,219,649
1,524,703
Expected tax charge based on the standard rate of corporation tax in the UK of 19.00% (2021: 19.00%)
231,733
289,694
Tax effect of expenses that are not deductible in determining taxable profit
61,541
450
Tax effect of income not taxable in determining taxable profit
(56,719)
Gains not taxable
371,828
Adjustments in respect of prior years
230
Permanent capital allowances in excess of depreciation
(78,848)
(153,837)
Other permanent differences
42
Exempt dividends
(5,866)
(5,023)
Remeasurement of deferred tax for changes in rates
42,065
312,597
Other adjustments
(4,975)
Movement in deferred tax not regognised
341,733
(344,015)
Taxation charge for the year
592,630
410,000
BEN BENNETT JR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 20 -
9
Dividends
2022
2021
£
£
Ordinary first interim paid
-
69,959
Ordinary second interim paid
-
383,025
452,984
10
Intangible fixed assets
Goodwill
Mineral Rights
Total
£
£
£
Cost
At 1 January 2022 and 31 December 2022
128,270
532,876
661,146
Amortisation and impairment
At 1 January 2022
121,806
18,043
139,849
Amortisation charged for the year
6,464
26,364
32,828
At 31 December 2022
128,270
44,407
172,677
Carrying amount
At 31 December 2022
488,469
488,469
At 31 December 2021
6,464
514,833
521,297
11
Tangible fixed assets
Freehold land and buildings
Plant and machinery
Total
£
£
£
Cost
At 1 January 2022
1,269,095
10,906,182
12,175,277
Additions
1,460,934
1,460,934
Disposals
(1,085,850)
(1,085,850)
At 31 December 2022
1,269,095
11,281,266
12,550,361
Depreciation and impairment
At 1 January 2022
266,372
6,967,195
7,233,567
Depreciation charged in the year
1,915
864,965
866,880
Eliminated in respect of disposals
(781,687)
(781,687)
At 31 December 2022
268,287
7,050,473
7,318,760
Carrying amount
At 31 December 2022
1,000,808
4,230,793
5,231,601
At 31 December 2021
1,002,723
3,938,987
4,941,710
BEN BENNETT JR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
11
Tangible fixed assets
(Continued)
- 21 -
The net book value of land and buildings includes £122 of leasehold land.
The gross book value of land and buildings includes £945,364 (2020: £966,140) of non-depreciable assets.
12
Fixed asset investments
2022
2021
Notes
£
£
Investments in subsidiaries
13
6,499
6,499
Listed investments
2,504,183
2,690,820
2,510,682
2,697,319
The company holds 100% of the ordinary share capital of Super Limes Limited, a company incorporated in England and Wales. Super Limes Limited was dormant throughout the year.
The aggregate amount of capital and reserves of Super Limes Limited at 31 December 2022 was £9,901.
Movements in fixed asset investments
Shares in subsidiaries
Other investments
Total
£
£
£
Cost or valuation
At 1 January 2022
6,499
2,690,820
2,697,319
Additions
-
760,171
760,171
Valuation changes
-
(662,445)
(662,445)
Disposals
-
(284,363)
(284,363)
At 31 December 2022
6,499
2,504,183
2,510,682
Carrying amount
At 31 December 2022
6,499
2,504,183
2,510,682
At 31 December 2021
6,499
2,690,820
2,697,319
13
Subsidiaries
Details of the company's subsidiaries at 31 December 2022 are as follows:
Name of undertaking
Address
Class of
% Held
shares held
Direct
Super Limes Limited
England and Wales
Ordinary shares
100.00
BEN BENNETT JR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 22 -
14
Stocks
2022
2021
£
£
Raw materials and consumables
517,634
327,917
Work in progress
27,593
38,569
Finished goods and goods for resale
30,174
28,234
575,401
394,720
The company held consignment stocks at the year end amounting to £193,349 (2020: £136,635) in respect of which the benefits and risks of holding the stock had not passed to the company.
15
Debtors
2022
2021
Amounts falling due within one year:
£
£
Trade debtors
2,358,690
2,215,192
Other debtors
689,084
525,516
Prepayments and accrued income
82,465
89,742
3,130,239
2,830,450
16
Creditors: amounts falling due within one year
2022
2021
£
£
Trade creditors
639,818
688,531
Amounts owed to group undertakings
9,901
9,901
Corporation tax
75,400
88,999
Other taxation and social security
417,553
439,863
Other creditors
13,175
198,524
Accruals and deferred income
960,208
582,078
2,116,055
2,007,896
17
Deferred taxation
Deferred tax assets and liabilities are offset where the 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
2022
2021
Balances:
£
£
Accelerated capital allowances
1,475,000
958,000
BEN BENNETT JR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
17
Deferred taxation
(Continued)
- 23 -
2022
Movements in the year:
£
Liability at 1 January 2022
958,000
Charge to profit or loss
517,000
Liability at 31 December 2022
1,475,000
18
Retirement benefit schemes
2022
2021
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
145,842
150,124
The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.
19
Share capital
2022
2021
2022
2021
Ordinary share capital
Number
Number
£
£
Issued and fully paid
'A' ordinary shares of £1 each
3,995
3,995
3,995
3,995
'B' ordinary shares of £1 each
14,995
15,000
14,995
14,995
18,990
18,995
18,990
18,990
Each 'A' shares entitles holders to full voting rights. Each 'A' share carries the right to participate in a dividend distribution. Each 'A' share carries the right to participate in a capital distribution including on a winding up. Shares are not redeemable.
The 'B' shares shall rank pari passu in all respects as one class of shares with the 'A' shares.
20
Operating lease commitments
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
2022
2021
£
£
Within one year
53,718
75,460
Between two and five years
53,718
53,718
129,178
BEN BENNETT JR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 24 -
21
Capital commitments
Amounts contracted for but not provided in the financial statements:
2022
2021
£
£
Acquisition of tangible fixed assets
-
437,672
22
Related party transactions
Included within other debtors is an amount of £688,625 (2021: £473,356) owed to the company by Ben Bennett Jr Properties Limited. A company of which Jane Bennett is also a director and shareholder.
23
Ultimate controlling party
Following the death of the company's majority shareholder, Mr B Bennett Jr who owned 67% of the share capital. These shares are currently held within his estate which is yet to distributed.
24
Cash generated from operations
2022
2021
£
£
Profit for the year after tax
627,019
1,114,703
Adjustments for:
Taxation charged
592,630
410,000
Investment income
(53,346)
(93,419)
Gain on disposal of tangible fixed assets
(134,716)
(81,544)
Amortisation and impairment of intangible assets
32,828
30,870
Depreciation and impairment of tangible fixed assets
866,880
819,342
Other gains and losses
315,970
(234,332)
Movements in working capital:
(Increase)/decrease in stocks
(180,681)
273,641
Increase in debtors
(299,789)
(504,609)
Increase/(decrease) in creditors
121,758
(278,637)
Cash generated from operations
1,888,553
1,456,015
25
Prior period adjustment
Adjustments to equity
The prior period adjustments do not give rise to any effect upon equity.
Adjustments to profit for the previous financial period
2021
£
Total adjustments
-
BEN BENNETT JR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
25
Prior period adjustment
(Continued)
- 25 -
Notes to adjustments
An adjustment to the prior year has been made to move the investment portfolio held by the company from current asset investments to fixed asset investments.
26
Analysis of changes in net funds
1 January 2022
Cash flows
31 December 2022
£
£
£
Cash at bank and in hand
2,497,545
701,282
3,198,827
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