Company registration number 05892469 (England and Wales)
HIGHWOOD GROUP LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
HIGHWOOD GROUP LIMITED
COMPANY INFORMATION
Directors
M O Baskerville
M Hawthorne
S Beech
E Lord
S Matthews
P Prosser
N Brown
(Appointed 3 October 2022)
Company number
05892469
Registered office
The Hay Barn
Upper Ashfield Farm
Hoe Lane
Romsey
Hampshire
SO51 9NJ
Auditor
Fiander Tovell Limited
Stag Gates House
63/64 The Avenue
Southampton
Hampshire
SO17 1XS
HIGHWOOD GROUP LIMITED
CONTENTS
Page
Strategic report
1 - 3
Directors' report
4 - 7
Independent auditor's report
8 - 10
Group statement of comprehensive income
11
Group balance sheet
12
Company balance sheet
13
Group statement of changes in equity
14
Company statement of changes in equity
15
Group statement of cash flows
16
Notes to the financial statements
17 - 32
HIGHWOOD GROUP LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 30 JUNE 2023
- 1 -

The directors present the strategic report for the year ended 30 June 2023.

Review of the business and key performance indicators

The group’s results for the year comprised turnover of £76.5m (2022 - £73.5m), a gross profit of £5.5m (2022 - £8.6m), operating profit of £1.3m (2022 – £4.7m) and profit on ordinary activities before taxation of £0.2m (2022 - £4.6m).

 

However, the past year was once again marked by hyper-inflationary conditions, supply chain and logistical challenges, and difficulties with subcontractors, all of which have had a notable impact on the profit margins of our ongoing legacy construction projects. Despite these challenges, the group achieved significant milestones by successfully securing and initiating four new contracts with a combined value of £60 million. Additionally, the group finalised three land deals, incorporating two associated contracted construction projects with new clients for the group in Octopus Real Estate at Alton for a 67 bedroom care home and Inspired Villages Group at Horndean for a zero-carbon Integrated Retirement Community. Throughout the year, the group completed, or was in the contractual process for, a total of 344 homes across various sites. Furthermore, progress was made as the group commenced construction on two new care homes and three housing schemes. Notably, four care homes with a total of 263 beds were successfully completed during the year, and the group is poised to deliver three more care homes with a combined capacity of 184 beds by the end of the 2024 financial year.

Principal risks and uncertainties

While the challenges posed by the uncertainties of COVID and Brexit are largely behind us, the aftermath has ushered in a new set of risks on some of our legacy projects for the group, some of which were underscored in the strategic report of the previous year.

The key risks and uncertainties expected to impact the group in the future include:

  1. Escalating inflation in the construction sector, particularly in essential materials such as plasterboard, timber, and steel, with annual price hikes surpassing 20%.

  2. Shortages of skilled labour in critical trades, a pervasive issue across the industry, impacting project timelines. These risks are actively addressed through proactive engagement with our supply chain ahead of schedule and a strategic focus on core supply chain partners.

  3. Challenges in the planning process within our operational area, exacerbated by staff shortages in local authorities and the substantial impact of regulatory requirements (water neutrality, nitrates, phosphates), which continue to impede the pace of delivery and contribute significantly to the costs of the development process.

  4. Political uncertainty and the effects the Autumn Budget released by then Prime Minister, Liz Truss, had on the investment market; specifically for the Group in respect of care homes, where the cost of borrowing and investment returns based upon a yield calculation had made some new schemes unviable for the time being.

  5. The potential for subcontractors facing liquidation poses a risk of incurring additional costs on ongoing contracts.

HIGHWOOD GROUP LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 2 -
Strategies and future outlook

The group's primary strategy revolves around the successful execution of partnership activities, involving the sourcing of land, navigating through the planning process, and subsequently developing (constructing/selling) in collaboration with housing associations, local authorities, or private sector owners/managers. This approach enables the group to maintain a positive cash position while extracting favourable margins from identified sites. Emphasising a balanced delivery across care homes, retirement living, and housing sites, the group perceives these sub-sectors as possessing enduring long-term growth prospects.

Complementing this core strategy, the group aims to sustain its robust contracting business, focusing on core competencies in housing, care homes, and retirement living products.

In the short term, the group boasts a pipeline exceeding £120 million in its contracting business, and collectively, with other associated companies under the same control, holds ownership or control over approximately 3,000 housing sites and 9 care home sites. The Directors express confidence in the ongoing success and growth of the group in the short term.

While the broader economic outlook anticipates a general weakening, the business has proactively mitigated much of this risk by diversifying its operations between construction and development in collaboration with partners. Moreover, the strategic product base spanning care, retirement, and housing aligns with sustained strong demand trends.

Section 172 statement

The prosperity of our business hinges on the unwavering support of our stakeholders. Establishing and nurturing positive relationships with those who share our values is a paramount focus for us. Collaborating towards common objectives not only reinforces our shared values but also plays a pivotal role in achieving enduring, sustainable success.

Our group operates cohesively as a consolidated entity, seamlessly integrating both development and contracting activities under a unified executive board. This board, comprised of Directors from all group companies, oversees and evaluates major decisions made by the group. Additionally, there is an oversight board featuring Directors from Highwood Holdings Ltd. This structure ensures that decisions endorsed by the executive board undergo thorough review, aligning consistently with the company's high standards and values.

Regular reviews of our long-term plan, conducted at least annually, form a crucial part of our strategic approach. In these reviews, a comprehensive assessment is made of all stakeholders, spanning from our dedicated staff to the extensive supply chain and valued business partners. An annual summary communication event serves as a platform to update all employees on the outcomes of these plan discussions, outlining the strategic trajectory of the business.

Employees: Employees are at the heart of the business, and our management prioritises regular engagement with them through various channels such as news updates, communication events, and away day gatherings. Despite being a relatively small business with 90 employees at year-end, we place a strong emphasis on fostering meaningful individual relationships with each team member. To ensure an open dialogue, the company conducts an annual staff survey, providing a platform for anonymous feedback on any issue. This proactive approach allows management to comprehend and address key concerns raised by our valued staff.

As part of our unwavering commitment to creating an exceptional workplace, the group has introduced several enhanced benefits since April 2022. These improvements encompass a more robust pension plan, increased life cover, enhanced income support, and the option for employees to join a private medical scheme. Our dedication to supporting a positive work environment remains steadfast, and we will persist in refining our efforts toward that goal.

The board takes this opportunity to express gratitude to all staff members for their collective efforts in contributing to the success of the year, overcoming various challenges along the way.

Customers: Our business thrives on partnerships, underscoring the paramount importance of the relationship between the company and our valued partners/customers. This dynamic is a central focus for all levels of management and employees, emphasising regular and transparent communication. Highwood takes pride in its commitment to delivering a superior service and product, a cornerstone of our organisational culture that ensures enduring customer relationships. To fuel our expansion plans, senior management actively seeks out new partnerships, reinforcing our dedication to sustainable growth.

HIGHWOOD GROUP LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 3 -

Suppliers: Our supply chain is integral to the seamless delivery of our products, and the company has cultivated a longstanding reputation as a preferred business partner, grounded in trust, consistent communication across all management levels, and steadfast fulfilment of commitments. We particularly pride ourselves on maintaining excellent payment terms for our suppliers, recognising it as a pivotal factor in fostering positive relationships and loyalty. This strong bond has played a crucial role in mitigating supply chain interruptions, addressing the risks highlighted in this report.

Environment: The Highwood group is acutely aware of the environmental impact of construction activities and is unwaveringly committed to implementing the requirements of the Streamlined Energy and Carbon Reporting (SECR), introduced on April 1, 2019. This commitment underscores our dedication to environmental responsibility and sustainability in our operations.

An independent assessment determined the scope of Highwood's activities requiring reporting on energy use and associated gas emissions, adhering to the methodology outlined in the Government's Streamlined Energy and Carbon Reporting (SECR) Guidance. During this 12-month period, carbon emissions measured at 2.3 tonnes CO2e per £1 million turnover. Demonstrating environmental responsibility, Highwood Group commits to achieving net-zero carbon emissions from Scope 1 & 2 activities covered by SECR by 2025.

To enhance energy efficiency, upcoming development sites will incorporate more energy-efficient portacabins for use as site offices. These feature advanced elements like PIR and LED lighting, insulated walls, programmable wall heaters, and door closers, aimed at optimising electrical and heating efficiency. Progress at our head office includes the conversion of most light fittings to LED, and efforts are underway to explore the feasibility of installing rooftop solar panels. Encouraging eco-friendly practices, an electric vehicle salary sacrifice scheme is available to all employees, complemented by the installation of two electric vehicle charging points at the head office, utilised daily by both employees and customers. Highwood's decarbonisation strategy includes nature-based carbon capture solutions on development sites, emphasizing the protection and additional planting of trees to contribute to environmental sustainability.

On behalf of the board

N Brown
Director
6 February 2024
HIGHWOOD GROUP LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2023
- 4 -

The directors present their annual report and financial statements for the year ended 30 June 2023.

Principal activities

The principal activity of the company is that of a holding company.

 

The principal activity of the group continued to be that of property development, building and construction services.

Results and dividends

The results for the year are set out on page 11.

Ordinary dividends were paid amounting to £2,000,000. The directors do not recommend payment of a further dividend.

Directors

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

N Meek
(Resigned 9 August 2023)
M O Baskerville
M Hawthorne
S Beech
E Lord
S Matthews
P Prosser
A Stevenson
(Resigned 31 October 2023)
N Brown
(Appointed 3 October 2022)
Financial instruments
Treasury operations and financial instruments

The group operates a centralised treasury function which is responsible for managing the liquidity and interest risks associated with the group's activities.

 

The group's principal financial instruments include bank balances, trade debtors and trade creditors arising directly from its operations.

Liquidity risk

The group manages its cash and borrowing requirements centrally in order to maximise interest income and minimise interest expense, whilst ensuring the group has sufficient liquid resources to meet the operating needs of the business.

Credit risk

Investments of cash surpluses and borrowings are made through financial institutions which must fulfil credit rating criteria approved by the board.

 

All customers who wish to trade on credit terms are subject to credit verification procedures. Trade debtors are monitored on an ongoing basis and provision is made for doubtful debts where necessary.

Pricing risk

The directors consider that the company faces the usual pricing risk of any other company operating in a competitive, commercial environment.

Auditor

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

HIGHWOOD GROUP LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 5 -
Energy and carbon report

UK energy use and associated greenhouse gas emissions

 

Current UK based annual energy usage and associated annual greenhouse gas (“GHG”) emissions are reported pursuant to the Companies (Directors’ Report) and Limited Liability Partnerships (Energy and Carbon Report) Regulations 2018 (“the 2018 Regulations”) that came into force 1 April 2019.

 

Organisational boundary

 

In accordance with the 2018 Regulations, the energy use and associated GHG emissions are for those assets owned or controlled within the UK only as defined by the operational control boundary, with the mandatory inclusion of scope 3 business travel in employee-owned vehicles (grey fleet). Emissions associated with rented equipment used in onsite operations is reported but considered voluntary according to the 2018 Regulations, as it is not considered transport or gas.

 

Reporting period

 

The annual reporting period is 1 July to 30 June each year and the energy and carbon emissions are aligned to this period.

 

2023
2022
Energy consumption
kWh
kWh
Aggregate of energy consumption in the year
- Gas combustion
70,343
20,156
- Electricity purchased
492,572
420,948
- Fuel consumed for transport
244,585
567,785
807,500
1,008,889
2023
2022
Emissions of CO2 equivalent
metric tonnes
metric tonnes
Scope 1 - direct emissions
- Gas combustion
12.90
3.70
- Fuel consumed for owned transport
14.50
28.30
27.40
32.00
Scope 2 - indirect emissions
- Electricity purchased
52.00
109.81
Scope 3 - other indirect emissions
- Fuel consumed for transport not owned by the group
105.60
77.20
Total gross emissions
185.00
219.01
Intensity ratio
Tonnes of CO2e per million-pound turnover
2.3
3.00
HIGHWOOD GROUP LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 6 -
Quantification and reporting methodology

The 2019 UK Government Environmental Reporting Guidelines and the GHG Protocol Corporate Accounting and Reporting Standard (revised edition) were followed. The 2023 UK Government GHG Conversion Factors for Company Reporting were used in emission calculations as these relate to the majority of the reporting period. The report has been reviewed independently by Briar (Briar Consulting Engineers Limited).

 

Electricity, gas and onsite operational fuel (diesel and gas oil) consumption were based on invoice records, while mileage was used to calculate energy and emissions from fleet vehicles and grey fleet. Gross calorific values were used except for mileage energy calculations as per Government GHG Conversion Factors.

 

The emissions are divided into mandatory and voluntary emissions according to the 2018 Regulations, then further divided into the direct combustion of fuels and the operation of facilities (scope 1), indirect emissions from purchased electricity (scope 2) and further indirect emissions that occur as a consequence of company activities but occur from sources not owned or controlled by the organisation (scope 3).

Intensity measurement

Three intensity ratios are reported showing emissions (tCO2e) per total million-pound (£m) turnover, per total million-pound (£m) cost of sales and per employee. The ratio activity data relates to UK operations only to align with the energy and emission reporting boundary. The turnover financial metric is considered the most relevant to the Company’s energy consuming activities and provides a good comparison of performance over time and across different organisations and sectors. Emissions per million-pound cost of sales and per employee provide other relevant comparable and performance metrics.

Measures taken to improve energy efficiency

This year, Highwood has begun steps in developing a net zero strategy, with emission saving opportunities being reviewed across owned buildings and development sites. As a result of this, plans are now in place for all new development sites to feature a more energy efficient portacabin(s) for use as site offices. These consist of PIR and LED lighting, insulated walls, programmable wall heaters and door closers to improve electrical and heating efficiency.

 

At the head office, most of the light fittings have now been converted to LED lighting and work is beginning to investigate the feasibility of roof top solar panels. The use of electric vehicles is also encouraged via an electric vehicle salary sacrifice scheme (available to all employees) along with the installation of 2 electric vehicle charging points at head office. The EV charge points are used daily by both employees and customers.

 

Nature based carbon capture solutions also form part of Highwood’s decarbonisation strategy on development sites through the protection of as many trees as possible and the additional planting of new trees.

HIGHWOOD GROUP LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 7 -
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 group and company, and of the profit or loss of the group for that period. In preparing these financial statements, the directors are required to:

 

 

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

Statement of disclosure to auditor

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

Disclosure in strategic report or directors' report

The group has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the group's strategic report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the directors' report. It has done so in respect of strategies and future outlook.

On behalf of the board
N Brown
Director
6 February 2024
HIGHWOOD GROUP LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF HIGHWOOD GROUP LIMITED
- 8 -
Opinion

We have audited the financial statements of Highwood Group Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 30 June 2023 which comprise the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows and notes to the financial statements, including 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:

Basis for opinion

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

Conclusions relating to going concern

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

 

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

 

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

Other information

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

 

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

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

HIGHWOOD GROUP LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF HIGHWOOD GROUP LIMITED
- 9 -
Matters on which we are required to report by exception

In the light of the knowledge and understanding of the group and the parent company and their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.

 

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

Responsibilities of directors

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

Auditor's responsibilities for the audit of the financial statements

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

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

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

Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:

We assessed the susceptibility of the group’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:

HIGHWOOD GROUP LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF HIGHWOOD GROUP LIMITED
- 10 -
Audit response to risks identified

To address the risk of fraud through management bias and override of controls, we:

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:

There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.

Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.

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.

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.

Adam Buse ACA (Senior Statutory Auditor)
For and on behalf of Fiander Tovell Limited
6 February 2024
Chartered Accountants
Statutory Auditor
Stag Gates House
63/64 The Avenue
Southampton
Hampshire
SO17 1XS
HIGHWOOD GROUP LIMITED
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2023
- 11 -
2023
2022
Notes
£'000
£'000
Turnover
3
76,520
73,471
Cost of sales
(70,984)
(64,904)
Gross profit
5,536
8,567
Administrative expenses
(4,360)
(3,950)
Other operating income
75
102
Operating profit
4
1,251
4,719
Interest receivable and similar income
8
15
1
Interest payable and similar expenses
9
(18)
(104)
Amounrts written off investments
10
(1,012)
-
Profit before taxation
236
4,616
Tax on profit
11
(16)
(903)
Profit for the financial year
220
3,713
Profit for the financial year is all attributable to the owners of the parent company.
Total comprehensive income for the year is all attributable to the owners of the parent company.

The profit and loss account has been prepared on the basis that all operations are continuing operations.

HIGHWOOD GROUP LIMITED
GROUP BALANCE SHEET
AS AT
30 JUNE 2023
30 June 2023
- 12 -
2023
2022
Notes
£'000
£'000
£'000
£'000
Fixed assets
Intangible assets
13
73
97
Tangible assets
14
221
227
294
324
Current assets
Stocks
17
4,641
5,756
Debtors falling due after more than one year
19
1,295
878
Debtors falling due within one year
19
19,427
17,943
Cash at bank and in hand
8,548
11,514
33,911
36,091
Creditors: amounts falling due within one year
20
(25,950)
(26,314)
Net current assets
7,961
9,777
Total assets less current liabilities
8,255
10,101
Creditors: amounts falling due after more than one year
21
(1,280)
(1,143)
Provisions for liabilities
Deferred tax liability
23
-
0
203
-
(203)
Net assets
6,975
8,755
Capital and reserves
Called up share capital
25
30
30
Share premium account
180
180
Profit and loss reserves
6,765
8,545
Total equity
6,975
8,755
The financial statements were approved by the board of directors and authorised for issue on 6 February 2024 and are signed on its behalf by:
06 February 2024
N Brown
Director
Company registration number 05892469 (England and Wales)
HIGHWOOD GROUP LIMITED
COMPANY BALANCE SHEET
AS AT 30 JUNE 2023
30 June 2023
- 13 -
2023
2022
Notes
£'000
£'000
£'000
£'000
Fixed assets
Intangible assets
13
14
18
Tangible assets
14
102
104
Investments
15
467
467
583
589
Current assets
Debtors
19
3,566
604
Cash at bank and in hand
32
69
3,598
673
Creditors: amounts falling due within one year
20
(4,151)
(1,232)
Net current liabilities
(553)
(559)
Total assets less current liabilities
30
30
Capital and reserves
Called up share capital
25
30
30

As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the period was £2,000,000 (2022 - £1,800,000).

The financial statements were approved by the board of directors and authorised for issue on 6 February 2024 and are signed on its behalf by:
06 February 2024
N Brown
Director
Company Registration No. 05892469
HIGHWOOD GROUP LIMITED
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2023
- 14 -
Share capital
Share premium account
Profit and loss reserves
Total
Notes
£'000
£'000
£'000
£'000
Balance at 1 July 2021
30
180
6,632
6,842
Period ended 30 June 2022:
Profit and total comprehensive income for the period
-
-
3,713
3,713
Dividends
12
-
-
(1,800)
(1,800)
Balance at 30 June 2022
30
180
8,545
8,755
Year ended 30 June 2023:
Profit and total comprehensive income for the year
-
-
220
220
Dividends
12
-
-
(2,000)
(2,000)
Balance at 30 June 2023
30
180
6,765
6,975
HIGHWOOD GROUP LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2023
- 15 -
Share capital
Profit and loss reserves
Total
Notes
£'000
£'000
£'000
Balance at 1 July 2021
30
-
0
30
Period ended 30 June 2022:
Profit and total comprehensive income for the period
-
1,800
1,800
Dividends
12
-
(1,800)
(1,800)
Balance at 30 June 2022
30
-
0
30
Year ended 30 June 2023:
Profit and total comprehensive income for the year
-
2,000
2,000
Dividends
12
-
(2,000)
(2,000)
Balance at 30 June 2023
30
-
0
30
HIGHWOOD GROUP LIMITED
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2023
- 16 -
2023
2022
Notes
£'000
£'000
£'000
£'000
Cash flows from operating activities
Cash generated from operations
29
1,277
9,714
Interest paid
(18)
(104)
Income taxes paid
(945)
(860)
Net cash inflow from operating activities
314
8,750
Investing activities
Purchase of intangible assets
-
(120)
Purchase of tangible fixed assets
(63)
(100)
Interest received
15
1
Net cash used in investing activities
(48)
(219)
Financing activities
Repayment of borrowings
(1,232)
(1,677)
Dividends paid to equity shareholders
(2,000)
(1,800)
Net cash used in financing activities
(3,232)
(3,477)
Net (decrease)/increase in cash and cash equivalents
(2,966)
5,054
Cash and cash equivalents at beginning of year
11,514
6,460
Cash and cash equivalents at end of year
8,548
11,514
HIGHWOOD GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
- 17 -
1
Accounting policies
Company information

Highwood Group Limited (“the company”) is a private company limited by shares domiciled and incorporated in England and Wales. The registered office is The Hay Barn, Upper Ashfield Farm, Hoe Lane, Romsey, Hampshire, SO51 9NJ.

 

The group consists of Highwood Group Limited and all of its subsidiaries.

1.1
Accounting convention

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

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £'000.

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

The 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 for parent company information presented within the consolidated financial statements:

 

1.2
Basis of consolidation

Investments in subsidiaries, joint ventures and associates are accounted for at cost less impairment.

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

 

All financial statements are made up to 30 June 2023. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.

 

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

1.3
Going concern

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

HIGHWOOD GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 18 -
1.4
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. The group recognises turnover on an accruals basis, where the amount of turnover can be reliably measured and it is probable that the future economic benefits will flow to the group.

Revenue from construction contracts is recognised by reference to the value of certified work at the year end.

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:

Software
20% straight line
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:

Leasehold improvements
10% straight line
Plant and equipment
20% - 25% straight line
Fixtures and fittings
20% straight line
Computers
25% straight line
Motor vehicles
25% straight line

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

1.7
Fixed asset investments

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

 

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

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

HIGHWOOD GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 19 -
1.8
Impairment of fixed assets

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

 

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

1.9
Work in progress

Work in progress is stated at the lower of cost and estimated selling price less costs to complete and sell.

1.10
Construction contracts

Where the outcome of a construction contract can be estimated reliably, revenue and costs are recognised by reference to the stage of completion of the contract activity at the reporting end date. Variations in contract work, claims and incentive payments are included to the extent that the amount can be measured reliably and its receipt is considered probable.

 

When it is probable that total contract costs will exceed total contract turnover, the expected loss is recognised as an expense immediately.

1.11
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.

1.12
Financial instruments

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

 

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

 

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

Basic financial assets

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

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.

HIGHWOOD GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 20 -
Derecognition of financial assets

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

Classification of financial liabilities

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

Basic financial liabilities

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

 

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

 

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

Derecognition of financial liabilities

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

1.13
Equity instruments

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

1.14
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 group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

HIGHWOOD GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 21 -
Deferred tax

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

 

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

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.

1.16
Retirement benefits

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

1.17
Leases

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

1.18
Government grants

Government grants are recognised in the same period as the expense to which they relate 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.

2
Judgements and key sources of estimation uncertainty

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

 

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

HIGHWOOD GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
2
Judgements and key sources of estimation uncertainty
(Continued)
- 22 -
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.

Accounting for construction contracts

Recognition of revenue and profit is based on judgements made in respect of the ultimate profitability of a contract. Such judgements are arrived at through the use of estimation in relation to costs and value of work performed to date and to be performed in bringing contracts to completion. These estimates are made by reference to recovery of pre-contract costs, variations in work scopes, claim recoveries and expected contract costs to complete. The group has appropriate control procedures to ensure all estimates are determined on a consistent basis and subject to review and authorisation. The amount included in cost accruals which has been estimated based on the expected profit margin is £11,020,000 (2022: £14,522,000).

3
Turnover and other revenue

The total turnover of the group for the year has been derived from its principal activities wholly undertaken in the United Kingdom.

2023
2022
£'000
£'000
Turnover analysed by class of business
Property development, building and construction
76,970
73,471
2023
2022
£'000
£'000
Other revenue
Interest income
15
1
4
Operating profit
2023
2022
£'000
£'000
Operating profit for the year is stated after charging:
Depreciation of owned tangible fixed assets
69
59
Amortisation of intangible assets
24
23
Operating lease charges
135
131
5
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£'000
£'000
For audit services
Audit of the financial statements of the group and company
2
1
Audit of the financial statements of the company's subsidiaries
39
34
41
35
HIGHWOOD GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
5
Auditor's remuneration
(Continued)
- 23 -
For other services
Taxation compliance services
7
5
All other non-audit services
21
50
28
55
6
Employees

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

Group
Company
2023
2022
2023
2022
Number
Number
Number
Number
Directors
9
7
9
10
Administration
21
17
-
-
Operation
60
58
-
-
90
82
9
10

Their aggregate remuneration comprised:

Group
Company
2023
2022
2023
2022
£'000
£'000
£'000
£'000
Wages and salaries
6,397
5,349
-
0
-
0
Social security costs
743
625
-
-
Pension costs
211
137
-
0
-
0
7,351
6,111
-
0
-
0
7
Directors' remuneration
2023
2022
£'000
£'000
Remuneration for qualifying services
1,349
1,137
Company pension contributions to defined contribution schemes
55
28
1,404
1,165
HIGHWOOD GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
7
Directors' remuneration
(Continued)
- 24 -
Remuneration disclosed above includes the following amounts paid to the highest paid director:
2023
2022
£'000
£'000
Remuneration for qualifying services
190
167
Company pension contributions to defined contribution schemes
9
4

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 9 (2022: 7).

 

The amounts included for employee and directors' remuneration cover the year ended 30 June 2023.

8
Interest receivable and similar income
2023
2022
£'000
£'000
Interest income
Other interest income
15
1
9
Interest payable and similar expenses
2023
2022
£'000
£'000
Other interest on financial liabilities
16
104
Other interest
2
-
Total finance costs
18
104
10
Amounts written off investments
2023
2022
£'000
£'000
Other gains and losses
(1,012)
-
11
Taxation
2023
2022
£'000
£'000
Current tax
UK corporation tax on profits for the current period
215
1,118
Adjustments in respect of prior periods
4
(1)
Total current tax
219
1,117
HIGHWOOD GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
11
Taxation
2023
2022
£'000
£'000
(Continued)
- 25 -
Deferred tax
Origination and reversal of timing differences
(203)
(214)
Total tax charge
16
903

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:

2023
2022
£'000
£'000
Profit before taxation
236
4,616
Expected tax charge based on the standard rate of corporation tax in the UK of 20.50% (2022: 19.00%)
48
877
Tax effect of expenses that are not deductible in determining taxable profit
-
0
32
Adjustments in respect of prior years
4
(1)
Group relief
6
(2)
Permanent capital allowances in excess of depreciation
-
0
(3)
Other non-reversing timing differences
(42)
-
Taxation charge
16
903
12
Dividends
2023
2022
Recognised as distributions to equity holders:
£'000
£'000
Final paid
2,000
1,800
13
Intangible fixed assets
Group
Software
£'000
Cost
At 1 July 2022 and 30 June 2023
120
Amortisation and impairment
At 1 July 2022
23
Amortisation charged for the year
24
At 30 June 2023
47
HIGHWOOD GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
13
Intangible fixed assets
(Continued)
- 26 -
Carrying amount
At 30 June 2023
73
At 30 June 2022
97
Company
Software
£'000
Cost
At 1 July 2022 and 30 June 2023
21
Amortisation and impairment
At 1 July 2022
3
Amortisation charged for the year
4
At 30 June 2023
7
Carrying amount
At 30 June 2023
14
At 30 June 2022
18
14
Tangible fixed assets
Group
Leasehold improvements
Plant and equipment
Fixtures and fittings
Computers
Motor vehicles
Total
£'000
£'000
£'000
£'000
£'000
£'000
Cost
At 1 July 2022
263
226
49
73
17
628
Additions
-
0
29
5
29
-
0
63
At 30 June 2023
263
255
54
102
17
691
Depreciation and impairment
At 1 July 2022
166
210
3
15
7
401
Depreciation charged in the year
20
9
12
24
4
69
At 30 June 2023
186
219
15
39
11
470
Carrying amount
At 30 June 2023
77
36
39
63
6
221
At 30 June 2022
97
16
46
58
10
227
HIGHWOOD GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
14
Tangible fixed assets
(Continued)
- 27 -
Company
Fixtures and fittings
Computers
Total
£'000
£'000
£'000
Cost
At 1 July 2022
49
73
122
Additions
5
29
34
At 30 June 2023
54
102
156
Depreciation and impairment
At 1 July 2022
3
15
18
Depreciation charged in the year
12
24
36
At 30 June 2023
15
39
54
Carrying amount
At 30 June 2023
39
63
102
At 30 June 2022
46
58
104
15
Fixed asset investments
Group
Company
2023
2022
2023
2022
Notes
£'000
£'000
£'000
£'000
Investments in subsidiaries
16
-
0
-
0
467
467
Movements in fixed asset investments
Company
Shares in subsidiaries
£'000
Cost or valuation
At 1 July 2022 and 30 June 2023
467
Carrying amount
At 30 June 2023
467
At 30 June 2022
467
16
Subsidiaries

Details of the company's subsidiaries at 30 June 2023 are as follows:

HIGHWOOD GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
16
Subsidiaries
(Continued)
- 28 -
Name of undertaking
Registered office
Class of
% Held
shares held
Direct
Indirect
Highwood Construction Limited
England & Wales
Ordinary
100.00
-
Highwood Homes Limited
England & Wales
Ordinary
100.00
-
Highwood Residential Limited
England & Wales
Ordinary
100.00
-
Highwood Resources Limited
England & Wales
Ordinary
100.00
-
Highwood Land (Horndean) Limited
England & Wales
Ordinary
-
100.00
North Stoneham Developments Limited
England & Wales
Ordinary
-
100.00
Highwood Land (South Allington) Limited
England & Wales
Ordinary
-
100.00
Highwood (Botley) Limited
England & Wales
Ordinary
-
100.00
Highwood Ventures Limited
England & Wales
Ordinary
-
100.00
Highwood Ventures 2 Limited
England & Wales
Ordinary
-
100.00

During the year ended 30 June 2023, the group acquired the 100% shareholdings in Highwood Ventures 2 Limited.

 

To recognise the transfer of Highwood Ventures 2 Limited from being direct subsidiaries of the Group's holding company, Highwood Holdings Limited, to being a subsidiary of Highwood Construction Limited (and so within this group and this consolidation).

 

This transfer is a group reconstruction and as such is accounted for under merger accounting. This requires the transfer to be treated as if it was always in place. Therefore the transactions relating to the subsidiary has been brought into the comparative and opening positions.

The registered offices for all of the above entities are the same as for Highwood Group Limited.

17
Stocks
Group
Company
2023
2022
2023
2022
£'000
£'000
£'000
£'000
Work in progress
4,641
5,756
-
-
HIGHWOOD GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 29 -
18
Construction contracts

The revenue disclosed for, both the current and comparative periods, relates to construction contracts. All trade debtors, work in progress and trade creditors at the period end are related to these ongoing contracts.

 

The balance sheet also includes accrued income of £5,229,000 (2022 - £6,045,000), deferred income of £Nil (2022 - £Nil) and accrued costs of £11,020,000 (2022 - £14,522,000) in respect of these contracts.

19
Debtors
Group
Company
2023
2022
2023
2022
Amounts falling due within one year:
£'000
£'000
£'000
£'000
Trade debtors
2,296
3,701
-
0
-
0
Corporation tax recoverable
66
6
-
0
-
0
Amounts owed by group undertakings
12,005
7,603
3,464
547
Other debtors
4,969
6,543
10
9
Prepayments
91
90
92
48
19,427
17,943
3,566
604
Amounts falling due after more than one year:
Trade debtors
1,295
878
-
0
-
0
Total debtors
20,722
18,821
3,566
604
20
Creditors: amounts falling due within one year
Group
Company
2023
2022
2023
2022
Notes
£'000
£'000
£'000
£'000
Other borrowings
22
-
0
1,232
-
0
-
0
Trade creditors
5,899
3,043
126
96
Amounts owed to group undertakings
5,420
6,048
3,783
812
Corporation tax payable
5
671
-
0
-
0
Other taxation and social security
387
469
232
291
Other creditors
93
33
-
0
-
0
Accruals and deferred income
14,146
14,818
10
33
25,950
26,314
4,151
1,232
HIGHWOOD GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 30 -
21
Creditors: amounts falling due after more than one year
Group
Company
2023
2022
2023
2022
£'000
£'000
£'000
£'000
Trade creditors
1,280
1,143
-
0
-
0
22
Loans and overdrafts
Group
Company
2023
2022
2023
2022
£'000
£'000
£'000
£'000
Other loans
-
0
1,232
-
0
-
0
Payable within one year
-
0
1,232
-
0
-
0

The above loan was repaid on 10 January 2023. The loan bore interest at 4% above Barclays Bank PLC base rate.

23
Deferred taxation

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

Liabilities
Liabilities
2023
2022
Group
£'000
£'000
Fair value adjustments on land
-
203
The company has no deferred tax assets or liabilities.
Group
Company
2023
2023
Movements in the year:
£'000
£'000
Liability at 1 July 2022
203
-
Credit to profit or loss
(203)
-
Asset at 30 June 2023
-
-
HIGHWOOD GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 31 -
24
Retirement benefit schemes
2023
2022
Defined contribution schemes
£'000
£'000
Charge to profit or loss in respect of defined contribution schemes
222
205

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

 

There were outstanding contributions at year end of £0 (2022: £1,000).

25
Share capital
Group and company
2023
2022
2023
2022
Ordinary share capital
Number
Number
£'000
£'000
Issued and fully paid
Ordinary shares of £1 each
30,000
30,000
30
30
26
Operating lease commitments
Lessee

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

Group
Company
2023
2022
2023
2022
£'000
£'000
£'000
£'000
Within one year
205
157
182
157
Between two and five years
427
525
411
525
632
682
593
682
27
Related party transactions

The company has taken advantage of the exemptions contained within section 33.1A of FRS102 to not disclose transactions with other group entities that are 100% owned members of the group.

 

The company operated an interest free loan account with CKS Investment Properties Limited and Hoe Lane Investments Limited, companies under the control of the former directors of the ultimate parent company of the group. At the balance sheet date, the company was owed £509,000 (2022: £215,000) from CKS Investment Properties and £252,000 from Hoe Lane Investments Limited in respect of these loans.

 

The company also operated an interest free loan account with Upper Ashfield Management Limited. The company is under the control of the directors of the ultimate parent company of the group. At the balance sheet date, the company was owed £9,000 (2022: £35,000) from Upper Ashfield Management Limited in respect of this loan.

HIGHWOOD GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 32 -
28
Controlling party

The immediate parent company is Highwood Holdings Limited, a company incorporated in England and Wales. The registered office is The Hay Barn, Upper Ashfield Farm, Romsey, Hampshire, SO51 9NJ. Copies of the consolidated accounts can be obtained from Companies House.

 

The ultimate parent is Highwood Group Holdings Limited. The registered office is The Hay Barn, Upper Ashfield Farm, Romsey, Hampshire, SO51 9NJ. Copies of the consolidated accounts can be obtained from Companies House.

29
Cash generated from group operations
2023
2022
£'000
£'000
Profit for the year after tax
220
3,713
Adjustments for:
Taxation charged
16
903
Finance costs
18
104
Investment income
(15)
(1)
Amortisation and impairment of intangible assets
24
23
Depreciation and impairment of tangible fixed assets
69
59
Other gains and losses
1,012
-
Movements in working capital:
Decrease in stocks
1,115
4,625
(Increase)/decrease in debtors
(2,853)
433
Increase/(decrease) in creditors
1,671
(145)
Cash generated from operations
1,277
9,714
30
Analysis of changes in net funds - group
1 July 2022
Cash flows
30 June 2023
£'000
£'000
£'000
Cash at bank and in hand
11,514
(2,966)
8,548
Borrowings excluding overdrafts
(1,232)
1,232
-
10,282
(1,734)
8,548
2023-06-302022-07-01falseCCH SoftwareCCH Accounts Production 2023.300N MeekM O BaskervilleM HawthorneS BeechE LordS MatthewsP ProsserA StevensonN BrownMr P M 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