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REGISTERED NUMBER: 01921630 (England and Wales)


















Strategic Report, Report of the Directors and

Financial Statements for the Year Ended 28 February 2023

for


MHH Contracting Limited



MHH Contracting Limited (Registered number: 01921630)








Contents of the Financial Statements

for the Year Ended 28 February 2023





Page




Company Information  

1




Strategic Report  

2




Report of the Directors  

4




Report of the Independent Auditors  

6




Income Statement  

9




Other Comprehensive Income  

10




Balance Sheet  

11




Statement of Changes in Equity  

12




Cash Flow Statement  

13




Notes to the Cash Flow Statement  

14




Notes to the Financial Statements

16





MHH Contracting Limited



Company Information

for the Year Ended 28 February 2023









DIRECTORS:

Mr M H Hague


Mrs J A Hague







SECRETARY:

Mrs J A Hague







REGISTERED OFFICE:

Prospect Farm


Kirkedge Road


High Bradfield


Sheffield


South Yorkshire


S6 6LJ







REGISTERED NUMBER:

01921630 (England and Wales)







AUDITORS:

Sutton McGrath Hartley


5 Westbrook Court


Sharrowvale Road


Sheffield


South Yorkshire


S11 8YZ



MHH Contracting Limited (Registered number: 01921630)



Strategic Report

for the Year Ended 28 February 2023


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


REVIEW OF BUSINESS

The principal activities of the company are providing services to the construction industry. The scope of the company's operations includes demolition & dismantling, earthworks, excavation, aggregate supplies, waste disposal, recycling, asbestos removal and site remediation.

MHH Contracting Limited also holds a portfolio of commercial and residential properties which are used to generate a rental yield.

PRINCIPAL RISKS AND UNCERTAINTIES

The principal risk to the activities of the company arises mainly from economic pressures of the construction industry. The company continues to mitigate this risk by using multiple different customers. The impact of inflationary pressures has driven up costs, but this has been eased by passing increases onto customers where possible. Despite this, the company has returned positive results and remains confident about opportunities into future years.


The impact of and quantification of a continued increase in bank interest rates has led to increased interest costs but the impact reduced with an upside gain from interest received.


Balance sheet risk emanates from reduction in profitability and adverse movement in the property market negatively impacting the valuation of the property portfolio.


During the year, the company has substantially invested in building its asset levels mainly focusing on increasing the size of the lorry fleet. The company has taken advantage of the super deduction scheme introduced by the Government to aid this process.


KEY PERFORMANCE INDICATORS

The key performance indicator used by the company to show the growth made is the level of turnover.


The company has grown the following revenue streams in the year:

- Customers loads removal increase by 10%

- Materials sold increase by 25%

- Plant hire increase by 32%

- Tipping increase by 31%


This quantifies as an increase of £1.825m of the £3.3m increase in turnover from the previous year and confirms the continued growth of the company.


The gross profit margin has remaining comparable in both years at between 25 - 28%. Despite an increase in turnover in the year, a reduction in margin was due to increased costs in vehicle expenses driven by an increased fleet and growing inflationary running costs.


As mentioned above, significant investment has grown the asset base of the company which has allowed increase volume and quality of services the company can provide.




MHH Contracting Limited (Registered number: 01921630)



Strategic Report

for the Year Ended 28 February 2023


FUTURE DEVELOPMENTS

The company continues to grow its asset base and service its continuing and growing customer list.


The company has identified potential growth opportunities both externally and internally which will lead to diversifying the company revenue streams.


An internal software program has been introduced which has allowed the services provided to be conducted more efficiently and improved communication between customers. The providing of a premium service to our customers remains our highest priority.


ON BEHALF OF THE BOARD:






Mr M H Hague - Director



29 November 2023



MHH Contracting Limited (Registered number: 01921630)



Report of the Directors

for the Year Ended 28 February 2023


The directors present their report with the financial statements of the company for the year ended 28 February 2023.


DIVIDENDS

No dividends will be distributed for the year ended 28 February 2023.


DIRECTORS

The directors shown below have held office during the whole of the period from 1 March 2022 to the date of this report.


Mr M H Hague

Mrs J A Hague


DONATIONS AND EXPENDITURE

The company has made donations of £6,966 (2023) and £50 (2022) to non-political parties.


STATEMENT OF DIRECTORS' RESPONSIBILITIES

The directors are responsible for preparing the Strategic Report, the Report of the Directors and the financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and 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 AS TO DISCLOSURE OF INFORMATION TO AUDITORS

So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and each director has taken all the steps that he or she ought to have taken as a director in order to make himself or herself aware of any relevant audit information and to establish that the company's auditors are aware of that information.



MHH Contracting Limited (Registered number: 01921630)



Report of the Directors

for the Year Ended 28 February 2023



AUDITORS

The auditors,  Sutton McGrath Hartley, will be proposed for re-appointment at the forthcoming Annual General Meeting.


ON BEHALF OF THE BOARD:






Mr M H Hague - Director



29 November 2023


Report of the Independent Auditors to the Members of

MHH Contracting Limited


Opinion

We have audited the financial statements of MHH Contracting Limited (the 'company') for the year ended 28 February 2023 which comprise the Income Statement, Other Comprehensive Income, Balance Sheet, Statement of Changes in Equity, Cash Flow Statement and Notes to the Cash Flow Statement, Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:
-give a true and fair view of the state of the company's affairs as at 28 February 2023 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.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report.  We are independent of the 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.


Other information

The directors are responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon.


Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.


In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.  We have nothing to report in this regard.


Opinions on other matters prescribed by the Companies Act 2006

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

-

the information given in the Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and

-

the Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements.


Report of the Independent Auditors to the Members of

MHH Contracting Limited



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 Report of the Directors.


We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:

-

adequate accounting records have not been kept, 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 directors' 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 Statement of Directors' Responsibilities set out on page four, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.


In preparing the financial statements, the directors are responsible for assessing the 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.


Auditors' responsibilities for the audit of the financial statements

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


The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:


Our assessment of the susceptibility to material misstatement, whether by fraud or error, is made in a risk based

approach.


In this approach, laws and regulations applicable to the entity, such as the Companies Act 2006, United Kingdom

Generally Accepted Accounting Practice including Financial Reporting Standard 102, the relevant tax compliance

regulations within the UK, employment law, and Health and Safety law is considered, and the policies and controls the entity has in place to comply with these laws are reviewed, by discussion, reviews of correspondence and registrations monitored by external bodies. The engagement team remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit.


Policies and controls relating to the risk of material misstatement as a result of fraud are also considered. These are

assessed by obtaining an understanding of the company's operations and control environment. The policies and

controls have been reviewed by discussion, review and sample testing of accounting entries, challenging assumptions and judgements, reviewing and evaluating related parties transactions, and wider background searches. Testing of income recognition and cut off, along with testing of inventory valuation is also completed.


We have ensured that the engagement team have appropriate levels of competence and experience to effectively

monitor these risks and carry out work relevant to our assessment of each risk, including consideration of the industry the company operates in and its size and complexity.


A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors.


Report of the Independent Auditors to the Members of

MHH Contracting Limited



Other matters which we are required to address

The comparative figures have not been audited as the audit exemption was taken. As far as we are aware, there is no material misstatement in those figures.


Use of our report

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





Jonathon Dickens ACA (Senior Statutory Auditor)

for and on behalf of Sutton McGrath Hartley

5 Westbrook Court

Sharrowvale Road

Sheffield

South Yorkshire

S11 8YZ


29 November 2023



MHH Contracting Limited (Registered number: 01921630)



Income Statement

for the Year Ended 28 February 2023


2023

2022


(Unaudited)



Notes

£

£


TURNOVER

13,987,505


10,679,063




Cost of sales

10,367,977


7,745,329



GROSS PROFIT

3,619,528


2,933,734




Administrative expenses

3,034,661


2,254,009



584,867


679,725




Other operating income

639,235


537,718



OPERATING PROFIT

4

1,224,102


1,217,443




Exceptional items

5

-


1,024,446



1,224,102


192,997




Interest receivable and similar income

157,602


118,523



1,381,704


311,520




Interest payable and similar expenses

6

176,398


157,015



PROFIT BEFORE TAXATION

1,205,306


154,505




Tax on profit

7

56,094


173,846



PROFIT/(LOSS) FOR THE FINANCIAL YEAR

1,149,212


(19,341

)




MHH Contracting Limited (Registered number: 01921630)



Other Comprehensive Income

for the Year Ended 28 February 2023


2023

2022


(Unaudited)



Notes

£

£


PROFIT/(LOSS) FOR THE YEAR

1,149,212


(19,341

)




OTHER COMPREHENSIVE INCOME  


Revaluation of properties

-


7,969,752



Income tax relating to other comprehensive

income

-


(951,900

)


OTHER COMPREHENSIVE INCOME FOR THE

YEAR, NET OF INCOME TAX

-


7,017,852



TOTAL COMPREHENSIVE INCOME FOR THE

YEAR

1,149,212


6,998,511





MHH Contracting Limited (Registered number: 01921630)



Balance Sheet

28 February 2023


2023

2022


(Unaudited)



Notes

£

£

£

£

FIXED ASSETS

Intangible assets

8

23,260


-



Tangible assets

9

11,691,593


10,119,870



Investments

10

162,394


162,394



Investment property

11

9,069,046


9,069,046



20,946,293


19,351,310




CURRENT ASSETS

Stocks

12

414,746


415,319



Debtors

13

13,573,995


13,286,713



Cash at bank and in hand

550,549


865,378



14,539,290


14,567,410



CREDITORS

Amounts falling due within one year

14

6,719,154


5,573,789



NET CURRENT ASSETS

7,820,136


8,993,621



TOTAL ASSETS LESS CURRENT LIABILITIES

28,766,429


28,344,931




CREDITORS

Amounts falling due after more than one

year

15

(2,976,707

)

(3,762,024

)



PROVISIONS FOR LIABILITIES

19

(1,988,819

)

(1,931,363

)


NET ASSETS

23,800,903


22,651,544




CAPITAL AND RESERVES

Called up share capital

20

150


3



Revaluation reserve

9,357,112


9,357,112



Retained earnings

14,443,641


13,294,429



SHAREHOLDERS' FUNDS

23,800,903


22,651,544




The financial statements were approved by the Board of Directors and authorised for issue on 29 November 2023 and were signed on its behalf by:






Mr M H Hague - Director




MHH Contracting Limited (Registered number: 01921630)



Statement of Changes in Equity

for the Year Ended 28 February 2023


Called up



share

Retained

Revaluation

Total


capital

earnings

reserve

equity



£

£

£

£


Balance at 1 March 2021

3


13,313,770


2,339,260


15,653,033




Changes in equity

Total comprehensive income

-


(19,341

)

7,017,852


6,998,511



Balance at 28 February 2022

3


13,294,429


9,357,112


22,651,544




Changes in equity

Issue of share capital

147


-


-


147



Total comprehensive income

-


1,149,212


-


1,149,212



Balance at 28 February 2023

150


14,443,641


9,357,112


23,800,903





MHH Contracting Limited (Registered number: 01921630)



Cash Flow Statement

for the Year Ended 28 February 2023


2023

2022


(Unaudited)



Notes

£

£

Cash flows from operating activities

Cash generated from operations

1

1,913,592


2,103,339



Interest paid

(155,449

)

(135,757

)


Interest element of finance lease payments

paid

(20,949

)

(21,258

)


Tax paid

(1,298

)

(324,282

)


Net cash from operating activities

1,735,896


1,622,042




Cash flows from investing activities

Purchase of intangible fixed assets

(23,260

)

-



Purchase of tangible fixed assets

(2,481,982

)

(681,984

)


Sale of tangible fixed assets

261,299


765,650



Interest received

157,602


118,523



Net cash from investing activities

(2,086,341

)

202,189




Cash flows from financing activities

Loan repayments in year

(826,195

)

(1,155,517

)


New finance leases

819,000


190,455



Finance leases paid

(433,040

)

(492,611

)


Amount introduced by directors

565,036


20



Amount withdrawn by directors

(3,971

)

(565,863

)


Share issue

147


-



Loans from related companies

1,192,023


720,592



Repaid to related companies

(1,277,384

)

(1,367,624

)


Net cash from financing activities

35,616


(2,670,548

)



Decrease in cash and cash equivalents

(314,829

)

(846,317

)


Cash and cash equivalents at beginning of

year

2

865,378


1,711,695




Cash and cash equivalents at end of year

2

550,549


865,378





MHH Contracting Limited (Registered number: 01921630)



Notes to the Cash Flow Statement

for the Year Ended 28 February 2023


1.

RECONCILIATION OF PROFIT/(LOSS) FOR THE FINANCIAL YEAR TO CASH GENERATED FROM OPERATIONS

2023

2022


(Unaudited)



£

£


Profit/(loss) for the financial year

1,149,212


(19,341

)



Depreciation charges

785,616


632,131




Profit on disposal of fixed assets

(136,657

)

(396,859

)



Distinfield Loan Write off

-


1,527,040




Finance costs

176,398


157,015




Finance income

(157,602

)

(118,523

)



Taxation

56,094


173,846



1,873,061


1,955,309




Decrease in stocks

573


2,230




Increase in trade and other debtors

(962,951

)

(1,362,606

)



Increase in trade and other creditors

1,002,909


1,508,406




Cash generated from operations

1,913,592


2,103,339




2.

CASH AND CASH EQUIVALENTS



The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts:



Year ended 28 February 2023


28/2/23


1/3/22


£

£


Cash and cash equivalents

550,549


865,378




Year ended 28 February 2022


28/2/22


1/3/21

(Unaudited)



£

£


Cash and cash equivalents

865,378


1,711,695






MHH Contracting Limited (Registered number: 01921630)



Notes to the Cash Flow Statement

for the Year Ended 28 February 2023


3.

ANALYSIS OF CHANGES IN NET DEBT



At 1/3/22

Cash flow

At 28/2/23


£

£

£


Net cash



Cash at bank and in hand

865,378


(314,829

)

550,549



865,378


(314,829

)

550,549




Debt


Finance leases

(693,109

)

(385,960

)

(1,079,069

)



Debts falling due within 1 year

(1,033,844

)

(72,082

)

(1,105,926

)



Debts falling due after 1 year

(3,319,955

)

898,277


(2,421,678

)


(5,046,908

)

440,235


(4,606,673

)



Total

(4,181,530

)

125,406


(4,056,124

)




MHH Contracting Limited (Registered number: 01921630)



Notes to the Financial Statements

for the Year Ended 28 February 2023


1.

STATUTORY INFORMATION



MHH Contracting Limited is a private company, limited by shares , registered in England and Wales. The company's registered number and registered office address can be found on the Company Information page.


2.

ACCOUNTING POLICIES



Basis of preparing the financial statements


These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention as modified by the revaluation of certain assets.    



Turnover

Turnover is measured at the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes.

Long term contracts

Amounts recoverable on long term contracts, which are included in debtors, are stated at the net sales value of the work done after provision for contingencies and anticipated future losses on contracts, less amounts received as progress payments on account. Excess progress payments are included in creditors as payments on account.


Intangible assets

Intangible assets are initially measured at cost. After initial recognition, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.


Computer software is being amortised evenly over its estimated useful life of two years.



Tangible fixed assets


Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life.  


Plant and machinery

-

25% on reducing balance


Fixtures and fittings

-

25% on reducing balance


Motor vehicles

-

25% on reducing balance



Investment property

Investment property is shown at most recent valuation. Any aggregate surplus or deficit arising from changes in fair value is recognised in profit or loss.


Stocks

Stocks are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items.


MHH Contracting Limited (Registered number: 01921630)



Notes to the Financial Statements - continued

for the Year Ended 28 February 2023


2.

ACCOUNTING POLICIES - continued



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.

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.


MHH Contracting Limited (Registered number: 01921630)



Notes to the Financial Statements - continued

for the Year Ended 28 February 2023


2.

ACCOUNTING POLICIES - continued

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.

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 company’s contractual obligations expire or are discharged or cancelled.


Taxation

Taxation for the year comprises current and deferred tax. Tax is recognised in the Income Statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date.



MHH Contracting Limited (Registered number: 01921630)



Notes to the Financial Statements - continued

for the Year Ended 28 February 2023


2.

ACCOUNTING POLICIES - continued


Deferred tax

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date.

Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference.

Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.


Pension costs and other post-retirement benefits

The company operates a defined contribution pension scheme. Contributions payable to the company's pension scheme are charged to profit or loss in the period to which they relate.


Leases


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



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



Rental income and expenditure 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.



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 are included in the profit and loss account for the period.


3.

EMPLOYEES AND DIRECTORS

2023

2022


(Unaudited)



£

£


Wages and salaries

1,796,864


1,458,934




Social security costs

196,185


150,182




Other pension costs

154,261


150,646



2,147,310


1,759,762





MHH Contracting Limited (Registered number: 01921630)



Notes to the Financial Statements - continued

for the Year Ended 28 February 2023


3.

EMPLOYEES AND DIRECTORS - continued



The average number of employees during the year was as follows:

2023

2022


(Unaudited)




Management

5


5




Support staff

11


9




Contractors

36


32



52


46




2023

2022


(Unaudited)



£

£


Directors' remuneration

17,664


17,656




4.

OPERATING PROFIT



The operating profit is stated after charging/(crediting):


2023

2022


(Unaudited)



£

£


Depreciation - owned assets

785,617


632,131




Profit on disposal of fixed assets

(136,657

)

(396,859

)



Audit Fees

4,500


-




5.

EXCEPTIONAL ITEMS

2023

2022


(Unaudited)



£

£


Exceptional items

-


(1,024,446

)



There are no exceptional items in the year ending 28 February 2023, However, compensation was recieved during the year ending 28 February 2022 after winning a court case.

6.

INTEREST PAYABLE AND SIMILAR EXPENSES


2023

2022


(Unaudited)



£

£


Bank loan interest

155,449


97,311




Interest on overdue tax

-


38,446




Hire purchase

20,949


21,258



176,398


157,015





MHH Contracting Limited (Registered number: 01921630)



Notes to the Financial Statements - continued

for the Year Ended 28 February 2023


7.

TAXATION



Analysis of the tax charge


The tax charge on the profit for the year was as follows:

2023

2022


(Unaudited)



£

£


Current tax:


UK corporation tax

56,094


173,846




Tax on profit

56,094


173,846





UK corporation tax has been charged at 19% .



Reconciliation of total tax charge included in profit and loss


The tax assessed for the year is lower than the standard rate of corporation tax in the UK. The difference is explained below:


2023

2022


(Unaudited)



£

£


Profit before tax

1,205,306


154,505




Profit multiplied by the standard rate of corporation tax in the UK of 19%

(2022 - 19%)  

229,008


29,356





Effects of:


Expenses not deductible for tax purposes

7,308


297,682




Capital allowances in excess of depreciation

(363,566

)

(36,847

)



Adjustments to tax charge in respect of previous periods

(1,364

)

(116,345

)



Deferred tax not provided on losses  

184,708


-




Total tax charge

56,094


173,846





Tax effects relating to effects of other comprehensive income




There were no tax effects for the year ended 28 February 2023.


2022



Gross


Tax


Net



£

£

£


Revaluation of properties

7,969,752


(951,900

)

7,017,852





MHH Contracting Limited (Registered number: 01921630)



Notes to the Financial Statements - continued

for the Year Ended 28 February 2023


8.

INTANGIBLE FIXED ASSETS

Computer


software



£


COST


Additions

23,260




At 28 February 2023

23,260




NET BOOK VALUE


At 28 February 2023

23,260




9.

TANGIBLE FIXED ASSETS

Fixtures



Freehold

Plant and

and

Motor



property

machinery

fittings

vehicles

Totals



£

£

£

£

£


COST


At 1 March 2022

7,968,500


6,325,114


112,462


524,550


14,930,626




Additions

52,036


1,983,753


115,193


331,000


2,481,982




Disposals

-


(374,890

)

-


(139,436

)

(514,326

)



At 28 February 2023

8,020,536


7,933,977


227,655


716,114


16,898,282




DEPRECIATION


At 1 March 2022

-


4,375,970


74,458


360,328


4,810,756




Charge for year

-


704,089


18,063


63,465


785,617




Eliminated on disposal

-


(292,098

)

-


(97,586

)

(389,684

)



At 28 February 2023

-


4,787,961


92,521


326,207


5,206,689




NET BOOK VALUE


At 28 February 2023

8,020,536


3,146,016


135,134


389,907


11,691,593




At 28 February 2022

7,968,500


1,949,144


38,004


164,222


10,119,870




The directors have valued the freehold land and buildings at a fair value of £7,968,500 as at 28 February 2022.The directors believes there is no material change in the value of the properties as at 28 February 2023.

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

20232022
Cost4,875,9694,875,969
Additions52,036

Carrying Value4,928,0054,875,969


MHH Contracting Limited (Registered number: 01921630)



Notes to the Financial Statements - continued

for the Year Ended 28 February 2023


10.

FIXED ASSET INVESTMENTS


2023

2022


(Unaudited)



£

£


Other investments not loans

162,394


162,394





Additional information is as follows:

Unlisted


investments



£


COST


At 1 March 2022


and 28 February 2023

162,392




NET BOOK VALUE


At 28 February 2023

162,392




At 28 February 2022

162,392





Investments (neither listed nor unlisted) were as follows:

2023

2022


(Unaudited)



£

£


Investment in subsidiaries

2


2




11.

INVESTMENT PROPERTY

Total



£


FAIR VALUE


At 1 March 2022


and 28 February 2023

9,069,046




NET BOOK VALUE


At 28 February 2023

9,069,046




At 28 February 2022

9,069,046





The directors have valued the investment property at a fair value of £9,069,046 as at 28 February 2022 based on market information.The directors believes there are no material change to the investment property valuation as at 28 February 2023.



The historical cost of the investment property is £2,160,372 (2022 - £2,160,372).


12.

STOCKS

2023

2022


(Unaudited)



£

£


Stocks

414,746


415,319





MHH Contracting Limited (Registered number: 01921630)



Notes to the Financial Statements - continued

for the Year Ended 28 February 2023


13.

DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR


2023

2022


(Unaudited)



£

£


Trade debtors

6,180,019


6,509,702




Bad debt provision

(79

)

(210,127

)



Other debtors

204,656


189,153




Intercompany loans

6,044,746


5,959,437




Directors' current accounts

1,959


563,024




Tax

-


199,968




Prepayments and accrued income

1,142,694


75,556



13,573,995


13,286,713




14.

CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR


2023

2022


(Unaudited)



£

£


Bank loans and overdrafts (see note 16)

1,105,926


1,033,844




Finance leases  (see note 17)

524,040


251,040




Trade creditors

2,886,612


1,023,396




Sales ledger credit balances

279,688


125,787




Tax

-


202,626




Social security and other taxes

51,235


37,638




VAT

118,617


216,851




Other creditors

215,297


200,000




Accruals and deferred income

1,537,739


2,482,607



6,719,154


5,573,789




15.

CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR


2023

2022


(Unaudited)



£

£


Bank loans (see note 16)

2,421,678


3,319,955




Finance leases  (see note 17)

555,029


442,069



2,976,707


3,762,024




16.

LOANS



An analysis of the maturity of loans is given below:


2023

2022


(Unaudited)



£

£


Amounts falling due within one year or on demand:


Bank loans

1,105,926


1,033,844





MHH Contracting Limited (Registered number: 01921630)



Notes to the Financial Statements - continued

for the Year Ended 28 February 2023


16.

LOANS - continued

2023

2022


(Unaudited)



£

£


Amounts falling due between two and five years:


Bank loans - 2-5 years

1,192,433


1,998,844




Loan Due for more than 5 years

1,229,245


1,321,111



2,421,678


3,319,955




17.

LEASING AGREEMENTS



Minimum lease payments under finance leases fall due as follows:



Finance leases  


2023

2022


(Unaudited)



£

£


Net obligations repayable:


Within one year

524,040


251,040




Between one and five years

555,029


442,069



1,079,069


693,109




18.

SECURED DEBTS



The following secured debts are included within creditors:


2023

2022


(Unaudited)



£

£


Bank loans

3,527,604


4,353,799




Finance leases

1,079,069


693,109



4,606,673


5,046,908





Net obligations under finance lease and hire purchase contracts are secured by fixed charges on the assets concerned.



The loans are secured on the assets of the company.


19.

PROVISIONS FOR LIABILITIES

2023

2022


(Unaudited)



£

£


Deferred tax

1,988,819


1,931,363





MHH Contracting Limited (Registered number: 01921630)



Notes to the Financial Statements - continued

for the Year Ended 28 February 2023


19.

PROVISIONS FOR LIABILITIES - continued


Deferred tax



£


Balance at 1 March 2022

1,931,363




Provided during year

57,456




Balance at 28 February 2023

1,988,819




20.

CALLED UP SHARE CAPITAL



Allotted, issued and fully paid:


Number:

Class:

Nominal

2023

2022


value:


£

£


3

Ordinary

£1

150


3




21.

DIRECTORS' ADVANCES, CREDITS AND GUARANTEES



The following advances and credits to directors subsisted during the years ended 28 February 2023 and 28 February 2022:


2023

2022


(Unaudited)



£

£


Mr M H Hague and Mrs J A Hague


Balance outstanding at start of year

563,024


(2,819

)



Amounts advanced

3,824


565,863




Amounts repaid

(565,035

)

(20

)



Amounts written off

-


-




Amounts waived

-


-




Balance outstanding at end of year

1,813


563,024




22.

RELATED PARTY DISCLOSURES



Entities over which the company has control



2023



2022




£   



£   




Amounts owed by related parties


159,136



159,136





Other related parties



2023



2022




£   



£   




Amounts owed by related parties


8,837,278



8,043,509




Amounts owed to related parties


300,000



200,000




Sales to related parties


944,383



1,369,840




Purchases from related parties


1,517,607



2,062,447