The directors present the strategic report and financial statements for Space & Time Media Limited (the company) for the twelve months ended 30 June 2023.
The business delivered a year of strong trading growth despite the challenges of the macroeconomic climate continuing to play its part. UK interest rates reached levels not seen since 2008, and house price inflation per annum slowed from 6.4% in June 2022 to 1.7% by June 2023. As anticipated, this led to increased levels of spending amongst our key property clients, who contributed to a 17% increase in turnover in the year to £87,272,463 (2022: £74,880,195). Furthermore, the business continued its strategic expansion into new sectors, a large proportion was driven by clients in the global healthcare and pharmaceuticals industry with spending growing 118% versus the previous year. This encouraging growth in activity led to Gross profit increasing in the year to £9,788,898 (2022: £8,551,282). RPI remained above 8% throughout the period however and this along with continued inflationary pressures within the labour market led to administration expenses, after other operating income, increasing year on year to £8,129,517 (2022: £7,446,186). Despite these exceptional cost pressures, the increased levels of business activity in the year meant the business delivered an overall 31% increase in profit before tax for the year of £1,806,195 (2022: £1,379,609).
Space & Time combines media and specialist technology solutions across the entire customer experience to create Growth Marketing outcomes for ambitious brand partners. During the year the company further evolved its strategy of providing technology-enabled solutions, launching several proprietary products to clients in the year and further developing its roadmap of relevant, first-to-market solutions.
The year ended 30 June 2023 was the second full year of trading of the agency’s repositioning, which was unveiled to clients through the spring and early summer of 2021 and to the wider market in August 2021. This repositioning saw the creation of our four divisions; Media, Technology, Performance Creative and Training, which innovate as specialist businesses with a raft of specialist solutions available to clients. These are interwoven by an operating model designed to maximise value to clients, ultimately led by our client experience team, overseeing our exemplary track record of building and retaining long-term client partnerships.
The anticipated commercial benefits of each of these changes have been realised through the year in facilitating deeper relationships with existing clients, additional value facilitated by the broader range of capabilities and solutions available, a large number of new business wins, and more robust profit margins spearheaded by our industry leading technology offering.
Our capability gives clients access to the entire customer experience by utilising our four strategic divisions:
Media
Our agnostic and omni-channel approach to media planning ensures we always create the most effective plans to deliver against our clients’ business needs and objectives. With fully in-house teams in Paid Search, Programmatic, Social Media, Amazon, Content, Research & Insights, Print, Audio/Visual and OOH, we are experts across all media channels, enabling clients to access the full extent of a client’s end customer journey.
Technology
Harnessing the power of tech and data, our specialist teams connect and visualise disparate data sources using a blend of artificial intelligence, machine learning and the company’s own intellectual property to create meaningful and actionable insights for clients to activate across their marketing campaigns and their entire technology ecosystem, accelerating business performance and intelligence at every level of a client’s organisation.
Performance Creative
Our team uses technology to drive enhanced campaign performance, personalised experiences, and increased automation through innovative and seamless creative production capability. We collaborate with existing creative partners, accelerate the performance of existing assets, or create ‘ground-up’ campaign ideation across Display, Social, DOOH, Video, Audio and Dynamic formats.
Training
We offer a range of bespoke training programmes to clients with in-house teams or brands looking to develop their own understanding of the marketing landscape. Programmes are delivered by our product specialists and held at the company’s offices, a 3rd party venue, remotely or at a client’s offices.
Awards won by the agency in 2022-23 were:
Prolific North Tech Awards – shortlisted
Digital Transformation of the Year
Cloud Technology Provider of the Year
BIMA100
Eliette Cremer & Sharon Wright – BIMA100 Strategists & Consultants
GENCFO Digital Finance Function Awards
SME Finance Team of the Year
Artificial Intelligence
As a proven early-stage adopter of many AI driven technologies and machine learning capability, Space & Time has a deep understanding of effective, equitable and responsible use AI.
In the year and in line with significantly increased global attention on the topic, the agency has accelerated its plan to develop a roadmap for AI into the future, focussing on GenAI, agency tooling, risk protection and measured performance implementation to ensure the technology is available to clients within a safe, commercial and scaleable framework.
Culture
The company places huge value on our talent and we have a number of initiatives that recognise this and enhance our staff’s general well-being and reiterates our commitment to social and environmental sustainability across the organisation.
Our continued investment in the company’s award-winning Space Academy training and development programme provides all staff with online bespoke learning pathways;
‘LaunchPad’, our talent attraction and induction programme, educates all new starters on our values as well as our stance and instructions for accessing our support programmes for mental health, wellbeing, training and personal development, Corporate Social Responsibility and introduces them to a ‘buddy’ and line manager that will oversee their growth in the company. This programme has been extremely successful during the year, with a high percentage of LaunchPad candidates offered permanent roles in the business at the end of their training programme;
Our flexible working policy continues to give staff greater flexibility and control of their work/life balance;
As a Living Wage Employer, we are committed to ensuring that our staff and the staff of any suppliers we work with are paid commensurately with the relevant living wage; and
Our membership of Ad Net Zero highlights our ongoing commitment to reducing the carbon impact of the advertising industry.
Principal risks and uncertainties
The company regularly reviews business risk and aims to mitigate these risks wherever possible through its internal systems and controls and where appropriate, targeted staff training. The directors consider the company’s main commercial and financial risks to be:
Economic uncertainty
Whilst the macroeconomic climate has stabilised to some degree, in comparison with the significant number of economic shocks experienced in the previous financial year, sustained price inflation, continued labour market pressures and increased interest rates continue to present significant headwinds within the UK economy. The company has assessed the risks and the potential impact on the business as a result of these economic factors, and measures have been taken to mitigate such risks and their impact as far as possible. These include continued focus on sector diversification, reviews of commercial terms with existing clients to improve certainty around income streams, and ongoing prioritisation of internal talent development to improve staff retention and reduce costs. The company remains profitable since the year end and has sufficient cash resources for the foreseeable future. As a result, the directors believe that they have the ability to respond effectively to continued uncertainty and that the company will be able to continue to meet its liabilities as they fall due for a period of at least twelve months from the date of the approval of these financial statements.
In common with all businesses, the performance of the company will be influenced by the general economic environment. We closely monitor leading market indicators particularly for sectors that our major clients and suppliers operate within. In addition, we work closely with all our clients and suppliers to ensure that we remain informed of how their businesses are performing and the key challenges that they face. The company reforecasts, at a minimum, on a quarterly basis and closely monitors its cash flow. It has historically and will continue to act promptly and decisively to address its business operations and cost base as and when trading or cash flow circumstances dictate.
Client retention
As a growth marketing agency, we enable our clients to secure optimal value from every part of the customer experience and their marketing investment. We form long-term partnerships through business empathy and commercial alignment, working across fully managed, hybrid or in-house models to deliver best-in-class expertise across media, technology, performance creative and training, driving market-beating long-term growth outcomes. We deliver this proactive approach every day, regularly monitoring and responding to our clients’ needs and their pre-agreed KPIs.
Credit and cash flow risk
The company, in common with all others, is potentially exposed to the risk of non-recovery of its debts. This risk is mitigated by credit checking and having credit limits in place for all customers. In addition, the company operates a robust credit control regime and wherever possible, credit insures its clients.
Trade creditors' liquidity risk is managed by ensuring sufficient funds are available to meet debts as they fall due. The company changed corporate banking partners from Lloyds to Barclays during the year, and now has a £6.5 million receivables finance facility in place with Barclays Bank PLC that provides appropriate working capital to meet the company’s day to day business needs. The company’s long-term business forecasts support the view that the company will have adequate resources to meet its debts as they fall due for the foreseeable future and for at least twelve months from the date of signing of these financial statements.
Exchange rate fluctuations
A significant part of the company’s activity is UK based but for its material overseas trade it mitigates exchange rate risk to a greater extent by ensuring that its overseas customers settle, and their related suppliers are paid, via the group’s US Dollar and Euro bank accounts wherever possible.
Key performance indicators
The key performance indicators monitored by the directors are those that best demonstrate the financial performance and strength of the company. Specifically, we look at year on year trends in the profit and loss account, in turnover and gross profit margin and on the balance sheet, the level of net current assets and cash balances to monitor the financial health and liquidity of the company. In common with most businesses, the global legacy impact of COVID–19 and other macroeconomic events have had a material impact on the company’s key performance indicators in the current and prior year.
The company saw a 17% increase in turnover in the year to £87,272,463 (2022: £74,880,195). Gross profit increased by 14%, to £9,788,898 (2022: £8,551,282), driven by revenue growth from existing clients, new business wins and continued diversification of the company’s client base specifically within the global healthcare and pharmaceuticals industry. Administration expenses, after other operating income, saw a 9% increase year on year to £8,129,517 (2022: £7,446,186), driven predominantly by persistent labour market challenges and increased RPI related cost pressures more generally. Interest receivable and similar income saw an 8% increase year on year to £347,500 (2022: £321,000) due to improved trading and resultant dividend income from the company’s subsidiary and associate undertakings. The overall improvement in trading in the year delivered an increase in profit before tax of 31% to reach £1,806,195 (2022: £1,379,609) as at the year end.
The tax charge for the year increased to £208,059 (2022: £119,682) as a result of the increased profit before tax.
This year-on-year improvement in trading increased the working capital requirements of the business and saw cash at bank and in hand decrease by £372,960 year on year to £2,119,882 (2022: £2,492,842). Encouragingly, the company’s net liabilities fell by 65% to £572,988 (2022: £1,630,405) as at 30 June 2023.
The board approved an intragroup dividend in the year to its ultimate parent of £575,000 (2022: £1,333,500), after this dividend, the company reported an increase in net assets of 67% to £2,550,218 (2022: £1,527,082) at its year-end).
The directors have been encouraged by the improvements in trading, financial strength and cash generation of the company in the months that have followed the year end and whilst the economic climate remains challenging, there are reasonable grounds to expect the financial strength of the business to continue to improve for the rest of the next financial year.
The Board has a long-term growth strategy for the business to build strategic and commercial alignment with our clients’ own business objectives to ensure long-term value creation, growth and deeper partnerships. This coupled with our ubiquitous commercial approach means that we deliver for our clients truly integrated solutions designed to expedite and enhance growth opportunities across their entire marketing operation.
The company aims to be a highly relevant growth partner to its clients by ensuring our capability is aligned with the entire customer journey and the proprietary products offered significantly enhance their growth prospects, many of these being designed to be authentic to the specific industry and sector our clients operate in. This is a key component of the agency’s strategy to grow into new sectors and will play a key role in the Boards commitment to achieving future growth both organically and by acquisition.
The Board recognises the importance of the company’s wider stakeholders when performing their duties under Section 172(1) of the Companies Act and their duties to act in the way they consider, in good faith, would be most likely to promote the success of the company for the benefit of its members as a whole and in doing so have regard (amongst other matters) to:
The likely consequences of any decisions in the long term.
The interests of the company’s employees.
The need to foster the company’s business relationships with suppliers, customers and others.
The impact of the company’s operations on the community and environment.
The desirability of the company maintaining a reputation for high standards of business conduct.
The need to act fairly between members of the company.
The Board considers that all their decisions are taken with the long-term in mind, understanding that these decisions need to regard the interests of the company’s employees, its relationships with suppliers, customers, the communities and the environment in which it operates.
As a Board we fulfil our duties as follows:
Group repositioning
The company’s divisional restructure, implemented in Autumn 2021, is now embedded in our operational and reporting structures and has strengthened our strategic position for years to come. More recently, we have begun to target the consolidating of our market position in a number of industry verticals outside of the residential development sector, to support the ongoing diversification of our client portfolio, whilst ensuring that our property expertise is maintained.
Employees, Community and Environment
The company recognises the huge impact that our employees make and our commitment to other important initiatives. This is described fully in the ‘Culture’ paragraph, on Page 2 of these financial statements.
Clients & suppliers
Securing and retaining clients and suppliers is another core focus. Our approach to this is explained in the ‘Client Retention’ and Economic uncertainty paragraphs on Page 3 of these financial statements.
On behalf of the board
The directors present their annual report and financial statements for the year ended 30 June 2023.
The results for the year are set out on page 15.
Ordinary dividends of £575,000 (2022: £1,333,500) were paid during the year. The directors do not recommend payment of a final dividend.
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
The company is looking to expand and new markets will feature strongly, whether that be through organic development of new relationships, new business, acquisition or by expanding our activities overseas.
We will continue to keep the business relevant in its market through a controlled investment in high quality employees, a strong management structure and innovative product creation.
The company is well positioned to deliver a strong performance in 2023/24.
The auditor, Moore Kingston Smith LLP, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
We recognise the necessity that businesses contribute to reducing global emissions and we intend to play our part, by doing more than the legal minimum. We also recognise the increasing importance placed by our clients on the carbon in their supply chain, and we seek to add value for them here as we do everywhere else. We have therefore chosen to outperform the 2050 target set by the UK government in 2019, and we will work to make the change as swiftly as possible.
Carbon emissions are classified as Scope1, 2 or 3. Scope 1 includes direct emissions from burning fossil fuels in a gas boiler to heat company premises. Scope 2 is made up of indirect emissions that a company is directly responsible for, such as burning fossil fuels for the generation of electricity and emissions from public transport made on company business. Scope 3 are indirect emissions the company is indirectly responsible for up and down its value chain; it tends to be much wider and could include things such as emissions from the company’s use of cloud computing, employee commuting and home working.
During the reporting period the agency made significant progress on understanding its footprint, including modelling legacy emissions for each year back to 2019, improving data capture opportunities to allow for more granular reporting moving forwards, and fulfilling the SECR framework for the first time.
Emissions were up year on year, reflecting the return to more “normal” ways of working post-COVID, however the agency remains committed to a series of ambitious but realistic emissions pledges:
Net zero across all three scopes by 2030 on a 90/10 basis using a 2019 base year.
Operational net zero ahead of this deadline.
Supporting clients to understand the carbon intensity of their chosen media and technology partners and consequently the emissions attributable to their campaigns.
With the capacity to capture and analyse emissions data now in place, the focus for the business will shift towards roadmapping its way towards meeting these ambitious targets: engaging with staff, landlords and key suppliers to increase transparency, improve reporting and, ultimately, drive down emissions.
With COVID still impacting on ways of working and with formal workplace restrictions in place for some of the period, emissions during Financial Year 2022 were artificially depressed, giving rise to an increase in emissions year on year. The increase seen in Financial Year 2023 represents the first full year with a return to more normal operating protocols concerning meeting clients in-person, in-office working, albeit on a 3/2 hybrid basis and increased travel between offices.
Off-setting some of this increase in Financial Year 2023 was the relocation of our London Head Office to premises powered by 100% renewable electricity. Additionally, this was the first full year in which we had no on-premises computer servers following our migration to cloud computing in the spring of 2022.
Utilities emissions below are presented using a market-based attribution excluding the newer London office's usage entirely and whilst reduction in usage will also be an objective, increasing the business’s use of renewable energy is intended as key means of reducing our overall emissions.
We have followed the 2019 HM Government Environmental Reporting Guidelines. We have also used the GHG Reporting Protocol – Corporate Standard and have used the 2023 and 2022 UK Government’s Conversion Factors for Company Reporting.
Itemised within Scope 3 indirect emissions are commuting emissions and homeworking emissions, modelled using responses to a staff survey conducted between July and September of 2023, with the results provided by 80 respondents applied on a percentage basis to the entire workforce. Since this is the first time the data was collected, the same survey has been used to understand commuter emissions for both financial year '23 and financial year '22, with financial year '22 data adjusted further to take account of 116 days during the period where due to the prevailing COVID-19 rules of the day our offices were closed to staff other than by exception.
The chosen intensity measurement ratio is total gross emissions in metric tonnes CO2e per £m revenue, giving the business a scalable understanding of its performance on this core metric as its growth plans are realised over the coming years.
Much of the focus during the period was on the capturing of more accurate and more granular data to facilitate the creation of a roadmap for carbon reduction. For example, the introduction of new fields for miles travelled or nights stayed within the coding tool for corporate credit cards, or securing regular meter readings from landlords. Progress has also been made concerning an algebraic reporting model for the upstream Scope 3 emissions of our clients' media investments.
In addition, the following energy efficiency measures have been taken:
The search for a new Edinburgh office was begun in earnest during the year and is likely to conclude during financial year 2024. The current location has an EPC rating of E+ and improving on this value is one of the core criteria for the new premises.
A step challenge was introduced, inviting staff to compete to achieve the highest step count over a month. This is planned to be repeated periodically as part of a plan to reduce commuting carbon emissions.
Engagement with the company's Cycle 2 Work scheme continued, with six loans issued during the year.
A salary sacrifice EV car scheme was introduced, with one employee taking advantage of this during the year.
Basis for 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.
Other information
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.
As explained more fully in the Directors' Responsibilities Statement set out on page 9, 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.
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.
As part of an audit in accordance with ISAs (UK) we exercise professional judgement and maintain professional scepticism throughout the audit. We also:
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. 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.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purposes of expressing an opinion on the effectiveness of the company’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors.
Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the company to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
Explanation as to what extent 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, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below.
The objectives of our audit in respect of fraud, are; to identify and assess the risks of material misstatement of the financial statements due to fraud; to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud, through designing and implementing appropriate responses to those assessed risks; and to respond appropriately to instances of fraud or suspected fraud identified during the audit. However, the primary responsibility for the prevention and detection of fraud rests with both management and those charged with governance of the company.
Our approach was as follows:
We obtained an understanding of the legal and regulatory requirements applicable to the company and considered that the most significant are the Companies Act 2006, UK financial reporting standards as issued by the Financial Reporting Council, and UK taxation legislation.
We obtained an understanding of how the company complies with these requirements by discussions with management and those charged with governance.
We assessed the risk of material misstatement of the financial statements, including the risk of material misstatement due to fraud and how it might occur, by holding discussions with management and those charged with governance.
We inquired of management and those charged with governance as to any known instances of non-compliance or suspected non-compliance with laws and regulations.
Based on this understanding, we designed specific appropriate audit procedures to identify instances of non-compliance with laws and regulations. This included making enquiries of management and those charged with governance and obtaining additional corroborative evidence as required.
There are inherent limitations in the audit procedures described above. We are less likely to become aware of instances of non-compliance with laws and regulations that are not closely related to events and transactions reflected in the financial statements. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion.
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.
The Profit and Loss Account has been prepared on the basis that all operations are continuing operations.
Space & Time Media Limited is a private company limited by shares incorporated in England and Wales. The registered office is 2nd Floor, 2 Old Street Yard, London, EC1Y 8AF.
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 £.
This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, 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:
Section 4 ‘Statement of Financial Position’ – Reconciliation of the opening and closing number of shares;
Section 7 ‘Statement of Cash Flows’ – Presentation of a statement of cash flow and related notes and disclosures;
Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues’ – Carrying amounts, interest income/expense and net gains/losses for each category of financial instrument; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;
Section 33 ‘Related Party Disclosures’ – Compensation for key management personnel.
The company has taken advantage of the exemption under section 400 of the Companies Act 2006 not to prepare consolidated accounts. The financial statements present information about the company as an individual entity and not about its group.
Space & Time Media Limited is a wholly owned subsidiary of Space and Time Holdings Limited. The ultimate parent company is Space & Time Group Limited. The results of Space & Time Media Limited are included in the consolidated financial statements of Space & Time Group Limited which are available from 2nd Floor, 2 Old Street Yard, London, EC1Y 8AF.
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.
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.
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.
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, 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.
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
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.
Changes in the fair value of derivatives that are designated and qualify as fair value hedges are recognised in profit or loss immediately, together with any changes in the fair value of the hedged asset or liability that are attributable to the hedged risk.
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.
The following estimates have had the most significant effect on amounts recognised in the financial statements.
In the normal course of business, the company makes an estimate of the amount and volume of media costs associated with each sale when the sale is ordered as well as any related rebates under the matching principle. These costs and rebates are reviewed periodically and adjusted where necessary.
The directors have completed a review of the trade debtor balances to determine balances which are unlikely to be received and a provision has been accounted for where necessary.
The investments held by the company are reviewed annually for impairment. If there is an indication of impairment, management will impair the asset to its recoverable amount.
The Directors have considered the carrying value of intercompany debtors at the reporting date. In establishing an appropriate provision, they have considered the on-going trading and net asset position of the respective companies as well as the nature of intercompany transactions, the ability of the group to vary these to ensure full recovery and the profitability of the group as a whole.
An analysis of the company's turnover is as follows:
The average monthly number of persons (including directors) employed by the company during the year was:
Their aggregate remuneration comprised:
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 8 (2022 - 7).
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:
The company's bank holds a fixed and floating charge over all assets of the company in respect of an invoice discounting facility provided to the company.
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.
At year end, the amounts outstanding in respect of pension contributions payable is £31,096 (2022: £31,200).
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:
As permitted by FRS 102 Section 33 "related party disclosures", the financial statements do not disclose
transactions with the immediate parent company and wholly owned fellow subsidiaries on the basis that group financial statements are prepared.
During the year, the company made sales of £26,572 (2022: £56,518) and purchases of £5,340,507 (2022: £4,924,051) with Adgenda Media International Limited, a company in which Space & Time Media Limited owns 55% of the share capital. As at 30 June 2023, there were amounts outstanding of £2,103,088 (2022: £1,325,947) due to Adgenda Media International Limited. During the year, Adgenda Media International Limited declared dividends to the company totalling £302,500 (2022: £267,000).
During the year, the company made sales of £110,153 (2022: £74,673) and purchases of £781,731 (2022: £742,011) with EG Media Limited, a company of which Space & Time Media Limited own 45% of the share capital. As at 30 June 2023, there were amounts outstanding of £323,086 (2022: £354,525) due to EG Media Limited. During the year, EG Media Limited declared dividends to the company totalling £45,000 (2022: £54,000).
The directors consider the immediate parent undertaking to be Space and Time Holdings Limited, a company incorporated in England and Wales. The ultimate parent undertaking is Space & Time Group Limited, a company incorporated in England and Wales.
Space & Time Group Limited is the smallest and largest group for which consolidated financial statements including the company are prepared. The consolidated financial statements of Space & Time Group Limited are available from its registered office, 2nd Floor, 2 Old Street Yard, London, EC1Y 8AF.
At the balance sheet date, there was no ultimate controlling party.
Details of the company's subsidiaries at 30 June 2023 are as follows:
As at 30 June 2022, there were amounts outstanding on the directors' current accounts of £44,849 (2022: £44,849).
No amounts were provided for or written off during the year.
Details of the company's associates at 30 June 2023 are as follows:
We have restated the prior year accounts for the reclassifications of intercompany wage recharges and bank interest payable. The reclassifications better reflect the substance of the transactions and hence provide more appropriate information for users of the financial statements.