Fluxys UK Limited 09829068 false 2022-01-01 2022-12-31 2022-12-31 The principal activity of the company is acting as a holding company in gas transport infrastructure entities, grouping the Fluxys participations / activities in UK. Digita Accounts Production Advanced 6.30.9574.0 true true true false true true true false 09829068 2022-01-01 2022-12-31 09829068 2022-12-31 09829068 bus:OrdinaryShareClass1 bus:Non-cumulativeShares 2022-12-31 09829068 core:RetainedEarningsAccumulatedLosses 2022-12-31 09829068 core:ShareCapital 2022-12-31 09829068 core:CurrentFinancialInstruments 2022-12-31 09829068 core:CurrentFinancialInstruments core:WithinOneYear 2022-12-31 09829068 core:Non-currentFinancialInstruments core:AfterOneYear 2022-12-31 09829068 core:ProvidedReleasedInPeriodProvisionsForImpairmentInvestments 2022-12-31 09829068 core:ProvisionsForImpairmentInvestments 2022-12-31 09829068 bus:FRS102 2022-01-01 2022-12-31 09829068 bus:Audited 2022-01-01 2022-12-31 09829068 bus:FullAccounts 2022-01-01 2022-12-31 09829068 bus:RegisteredOffice 2022-01-01 2022-12-31 09829068 bus:Director1 2022-01-01 2022-12-31 09829068 bus:Director2 2022-01-01 2022-12-31 09829068 bus:OrdinaryShareClass1 bus:Non-cumulativeShares 2022-01-01 2022-12-31 09829068 bus:PrivateLimitedCompanyLtd 2022-01-01 2022-12-31 09829068 1 2022-01-01 2022-12-31 09829068 core:RetainedEarningsAccumulatedLosses 2022-01-01 2022-12-31 09829068 core:ShareCapital 2022-01-01 2022-12-31 09829068 core:AllSubsidiaries 2022-01-01 2022-12-31 09829068 core:ParentEntities 2022-01-01 2022-12-31 09829068 core:Subsidiary1 2022-01-01 2022-12-31 09829068 core:Subsidiary1 1 2022-01-01 2022-12-31 09829068 core:Subsidiary1 countries:AllCountries 2022-01-01 2022-12-31 09829068 core:Subsidiary2 2022-01-01 2022-12-31 09829068 core:Subsidiary2 1 2022-01-01 2022-12-31 09829068 core:Subsidiary2 countries:AllCountries 2022-01-01 2022-12-31 09829068 core:Subsidiary3 2022-01-01 2022-12-31 09829068 core:Subsidiary3 1 2022-01-01 2022-12-31 09829068 core:Subsidiary3 countries:Belgium 2022-01-01 2022-12-31 09829068 core:UKTax 2022-01-01 2022-12-31 09829068 1 2022-01-01 2022-12-31 09829068 1 2022-01-01 2022-12-31 09829068 countries:AllCountries 2022-01-01 2022-12-31 09829068 countries:Belgium 2022-01-01 2022-12-31 09829068 2021-12-31 09829068 core:RetainedEarningsAccumulatedLosses 2021-12-31 09829068 core:ShareCapital 2021-12-31 09829068 core:CostValuation 2021-12-31 09829068 core:ProvisionsForImpairmentInvestments 2021-12-31 09829068 2021-01-01 2021-12-31 09829068 2021-12-31 09829068 bus:OrdinaryShareClass1 bus:Non-cumulativeShares 2021-12-31 09829068 core:RetainedEarningsAccumulatedLosses 2021-12-31 09829068 core:ShareCapital 2021-12-31 09829068 core:CurrentFinancialInstruments 2021-12-31 09829068 core:CurrentFinancialInstruments core:WithinOneYear 2021-12-31 09829068 core:Non-currentFinancialInstruments core:AfterOneYear 2021-12-31 09829068 bus:OrdinaryShareClass1 bus:Non-cumulativeShares 2021-01-01 2021-12-31 09829068 1 2021-01-01 2021-12-31 09829068 core:RetainedEarningsAccumulatedLosses 2021-01-01 2021-12-31 09829068 core:ShareCapital 2021-01-01 2021-12-31 09829068 core:Subsidiary1 1 2021-01-01 2021-12-31 09829068 core:Subsidiary2 1 2021-01-01 2021-12-31 09829068 core:Subsidiary3 1 2021-01-01 2021-12-31 09829068 core:UKTax 2021-01-01 2021-12-31 09829068 2020-12-31 09829068 core:RetainedEarningsAccumulatedLosses 2020-12-31 09829068 core:ShareCapital 2020-12-31 iso4217:GBP xbrli:pure xbrli:shares

Registration number: 09829068

Fluxys UK Limited

Annual Report and Financial Statements

for the Year Ended 31 December 2022

 

Fluxys UK Limited

Contents

Company Information

1

Strategic Report

2 to 3

Directors' Report

4 to 5

Independent Auditor's Report

6 to 9

Profit and Loss Account

10

Statement of Comprehensive Income

11

Balance Sheet

12

Statement of Changes in Equity

13

Notes to the Financial Statements

14 to 22

 

Fluxys UK Limited

Company Information

Directors

Mr N C R Daubies

Mr B De Waele

Registered office

Clarendon House
Clarendon Road
Cambridge
Cambs
CB2 8FH

Auditors

BDO LLP
Newton House
Cambridge Business Park
Cambridge
CB4 0WZ

 

Fluxys UK Limited

Strategic Report for the Year Ended 31 December 2022

The directors present their strategic report for the year ended 31 December 2022.

Fair review of the business

Objectives and activities
The main activity of Fluxys UK Limited consists of acting as a holding company in gas transport infrastructure entities, grouping the Fluxys participations / activities in the UK.

Achievements and performance
The results for the year ended 31 December 2022 show a profit of €63.04m (2021: €12.77m).
At 31 December 2022, the company had net assets of €133.43m (31 December 2021100.38m).

Principal risks and uncertainties

The main risks and uncertainties that Fluxys UK faces are closely linked to those of its main subsidiary, Interconnector Limited (“Interconnector”).

The principal risk is the market risk. The company is a source of flexible gas supply and competes with other infrastructure assets such as pipelines, LNG terminals and storage. There is increasing competition from LNG deliveries to continental Europe and from BBL Company (the operator of a competitor pipeline between the UK and the Netherlands). Interconnector aims for a fair and competitive environment in the markets in which it operates, and has adopted strategies to deliver this through the use of innovative products, services and pricing models. Interconnector also works with regulators and governments to ensure a fair and competitive environment. In the long term the market could be impacted by the energy transition and this evolution is being monitored.

Financial risk management

Currently, Fluxys UK Limited is not exposed to price risk, to currency risk, to credit risk, liquidity risk, cash flow risk. The interest rate risk exposure is fully hedged.

Future developments

As a holding company, Fluxys UK follows the investment opportunities which are in the scope of the Fluxys group activities. Its future developments are also closely linked to those of its main subsidiary, Interconnector.

Section 172(1) statement

Section 172 of the Companies Act 2006 sets out a number of general duties that directors owe to a company. This includes exercising reasonable care, skill and diligence and avoiding conflicts of interests to promote the success of the Company.

The directors of the Company consider that they have responsibly and appropriately discharged their duties under the Companies Act 2006 (the “Act”), including their duty to act in the way that they consider, in good faith, will be most likely to promote the success of the Company for the benefit of its members as a whole, having due regard in doing so for the matters set out in section 172 (1) (a) to (f) in the Act (“s.172”).

The Company is part of the Fluxys SA Group. Consequently, the Board of the Fluxys SA Group and its Committees have overarching decision making authority for the Group on a number of reserved matters. These include setting the Group’s strategy and values, as well as reviewing and approving the Group’s operating plans, policies, processes and management structures, amongst others. Responsibility for actioning the Group Board’s decisions and strategic direction throughout the day-to-day management of the Group then rests with the Group Board’s executive directors and the Group’s senior leadership team. The directors of the Company therefore ensure that they give due care and consideration to discharging their duties and having regard for the matters in s.172 by adopting and adhering to the Group’s internal governance arrangements as outlined above.

 

Fluxys UK Limited

Strategic Report for the Year Ended 31 December 2022

In particular, the directors of the Company have considered the likely consequences of decisions in the long term, and the need to maintain a reputation for high standards of business conduct by ensuring that the Group’s strategy, policies and minimum standards are adopted and supported by the Company. The Company’s principal activity is that of a holding company and therefore the directors consider the needs of the Group in its decision-making as its direct stakeholders. Furthermore, as the Company relies on the resources of the Group, including its employees, suppliers and other business relationships, the directors also consider the needs of these indirect stakeholders, and any consequent impacts on them, by adopting and supporting the Group Board’s decisions where these stakeholders were directly considered.

Approved and authorised by the Board on 13 February 2024 and signed on its behalf by:
 

.........................................
Mr N C R Daubies
Director

.........................................
Mr B De Waele
Director

 

Fluxys UK Limited

Directors' Report for the Year Ended 31 December 2022

The directors present their report and the financial statements for the year ended 31 December 2022.

Directors of the company

The directors who held office during the year were as follows:

Mr N C R Daubies

Mr B De Waele

Information included in the Strategic Report

Likely future developments in the group's business and financial risk management policies have been included in the Strategic report.

Energy and Carbon reporting

The company has taken exemption from reporting under the Streamlined Energy and Carbon Reporting Framework.
The company has taken the low emission exemption for companies using less than 40,000kwh of energy.

Going concern

The prospects of the company are entirely dependent on the success of its affiliates Interconnector and GMSL. Taking into consideration the prospects for INT and GMSL, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future.

The company has 2 zero coupon notes with maturity date in 2024. In the event that the notes are not extended or replaced, the directors are satisfied that the company will have sufficient liquid resources to repay the balances in full as they fall due. Thus, they continue to adopt the going concern basis in preparing this management report.

Directors responsibilities statement

The directors acknowledge their responsibilities for preparing the Annual Report and the financial statements in accordance with applicable law and regulations.

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

select suitable accounting policies and apply them consistently;

make judgements and accounting estimates that are reasonable and prudent;

state whether applicable United Kingdom Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and

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.

 

Fluxys UK Limited

Directors' Report for the Year Ended 31 December 2022

Disclosure of information to the auditors

Each director has taken steps that they ought to have taken as a director in order to make themselves aware of any relevant audit information and to establish that the company's auditors are aware of that information. The directors confirm that there is no relevant information that they know of and of which they know the auditors are unaware.

Approved and authorised by the Board on 13 February 2024 and signed on its behalf by:
 

.........................................
Mr N C R Daubies
Director

.........................................
Mr B De Waele
Director

 

Fluxys UK Limited

Independent Auditor's Report to the Members of Fluxys UK Limited

Opinion on the financial statements

In our opinion the financial statements:

give a true and fair view of the state of the company's affairs as at 31 December 2022 and of its profit for the year then ended;

have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

have been prepared in accordance with the requirements of the Companies Act 2006.

We have audited the financial statements of Fluxys UK Limited (the 'company') for the year ended 31 December 2022, which comprise the Profit and Loss Account, Statement of Comprehensive Income, Balance Sheet, Statement of Changes in Equity, and Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

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 responsibilities for the audit of the financial statements section of our report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Independence

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.

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 original 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 included in the Annual Report and Financial Statements, other than the financial statements and our auditor’s report 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.

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.

 

Fluxys UK Limited

Independent Auditor's Report to the Members of Fluxys UK Limited

Other Companies Act 2006 reporting

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

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

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

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Directors' Report.

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

adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or

the financial statements are not in agreement with the accounting records and returns; or

certain disclosures of 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 Directors responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Auditor’s responsibilities for the audit of the financial statements

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

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

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

Non-compliance with laws and regulations

Based on:

Our understanding of the Company and the industry in which it operates;

Discussion with management and those charged with governance;

Obtaining and understanding of the Company’s policies and procedures regarding compliance with laws and regulations; and

 

Fluxys UK Limited

Independent Auditor's Report to the Members of Fluxys UK Limited

 

we considered the significant laws and regulations to be FRS 102 Financial Reporting Standards, the Companies Act 2006, UK tax legislation, etc.

The Company/Group is also subject to laws and regulations where the consequence of non-compliance could have a material effect on the amount or disclosures in the financial statements, for example through the imposition of fines or litigations. We identified such laws and regulations to be the Companies Act 2006 and UK tax legislation.

Our procedures in respect of the above included:

Enquiry with management and those charged with governance as to whether the Company is in compliance with laws and regulations that may have a material effect on the financial statements;

Review of minutes of meeting of those charged with governance for any instances of non-compliance with laws and regulations;

Review of correspondence with tax authorities, where available, for any instances of non-compliance with laws and regulations;

Review of financial statement disclosures and agreeing to supporting documentation;

 


Fraud

We assessed the susceptibility of the financial statements to material misstatement, including fraud. Our risk assessment procedures included:

Enquiry with management and those charged with governance regarding any known or suspected instances of fraud;

Obtaining an understanding of the Company’s policies and procedures relating to:
o Detecting and responding to the risks of fraud; and
o Internal controls established to mitigate risks related to fraud.

Review of minutes of meeting of those charged with governance for any known or suspected instances of fraud;

Discussion amongst the engagement team as to how and where fraud might occur in the financial statements;

Performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud;

 

Based on our risk assessment, we considered the areas most susceptible to fraud to be valuation of investment, management override of controls and bias in making judgements and estimates.

Our procedures in respect of the above included:

Obtaining an understanding of management’s investment valuation method including the forecasts, and reviewing these for evidence of bias;

Obtaining specialist’s review of management’s valuation method and challenging management on any material findings that indicate existing of bias;

Testing a sample of journal entries throughout the year, which met a defined risk criteria, by agreeing to supporting documentation;

Assessing significant estimates made by management for bias. These include impairment assessment of the investments.

 

Fluxys UK Limited

Independent Auditor's Report to the Members of Fluxys UK Limited

 

We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members who were all deemed to have appropriate competence and capabilities and remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit.

Our audit procedures were designed to respond to risks of material misstatement in the financial statements, recognising that the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery, misrepresentations or through collusion. There are inherent limitations in the audit procedures performed and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we are to become aware of it.

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.

......................................
Piers Harrison (Senior Statutory Auditor)
For and on behalf of BDO LLP, Statutory Auditor
Cambridge, UK

BDO LLP is a limited liability partnership registered in England and Wales (with registered number OC305127).

13 February 2024

 

Fluxys UK Limited

Profit and Loss Account for the Year Ended 31 December 2022

Note

2022

2021

Turnover

-

-

Gross profit/(loss)

 

-

-

Administrative expenses

 

(93,737)

(106,957)

Operating loss

3

(93,737)

(106,957)

Income from shares in group undertakings

 

76,636,454

27,758,146

Other interest receivable and similar income

5

297,405

-

Amounts written off investments

 

(11,580,229)

(13,215,517)

Interest payable and similar expenses

6

(2,584,952)

(1,958,787)

   

62,768,678

12,583,842

Profit before tax

 

62,674,941

12,476,885

Tax on profit

7

368,635

293,765

Profit for the financial year

 

63,043,576

12,770,650

The above results were derived from continuing operations.

The company has no recognised gains or losses for the year other than the results above.

 

Fluxys UK Limited

Statement of Comprehensive Income for the Year Ended 31 December 2022

2022

2021

Profit for the year

63,043,576

12,770,650

Total comprehensive income for the year

63,043,576

12,770,650

 

Fluxys UK Limited

(Registration number: 09829068)
Balance Sheet as at 31 December 2022

Note

2022

2021

Fixed assets

 

Investments

8

212,362,386

223,942,615

Current assets

 

Debtors

9

61,819,041

15,144,094

Cash and cash equivalents

10

218,416

218,744

 

62,037,457

15,362,838

Creditors: Amounts falling due within one year

11

(26,214)

(15,501)

Net current assets

 

62,011,243

15,347,337

Total assets less current liabilities

 

274,373,629

239,289,952

Creditors: Amounts falling due after more than one year

11

(140,946,099)

(138,905,998)

Net assets

 

133,427,530

100,383,954

Capital and reserves

 

Called up share capital

12

64,843,221

64,843,221

Retained earnings

68,584,309

35,540,733

Shareholders' funds

 

133,427,530

100,383,954

Approved and authorised by the Board on 13 February 2024 and signed on its behalf by:
 

.........................................
Mr N C R Daubies
Director

.........................................
Mr B De Waele
Director

 

Fluxys UK Limited

Statement of Changes in Equity for the Year Ended 31 December 2022

Share capital

Retained earnings

Total

At 1 January 2022

64,843,221

35,540,733

100,383,954

Profit for the year

-

63,043,576

63,043,576

Dividends

-

(30,000,000)

(30,000,000)

At 31 December 2022

64,843,221

68,584,309

133,427,530




 

Share capital

Retained earnings

Total

At 1 January 2021

64,843,221

32,770,083

97,613,304

Profit for the year

-

12,770,650

12,770,650

Dividends

-

(10,000,000)

(10,000,000)

At 31 December 2021

64,843,221

35,540,733

100,383,954

 

Fluxys UK Limited

Notes to the Financial Statements for the Year Ended 31 December 2022

1

General information

The company is a private company limited by share capital, incorporated in England & Wales.

The address of its registered office is:
Clarendon House
Clarendon Road
Cambridge
Cambs
CB2 8FH

These financial statements were authorised for issue by the Board on 13 February 2024.

2

Accounting policies

Statement of compliance

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.

Summary of significant accounting policies and key accounting estimates

The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

Basis of preparation

These financial statements have been prepared using the historical cost convention except that as disclosed in the accounting policies certain items are shown at fair value.

The financial statements are prepared in euros, which is the functional currency of the entity.

Summary of disclosure exemptions

The company satisfies the criteria of being a qualifying entity as defined in FRS 102. As such, advantage has been taken of the following disclosure exemptions available under paragraph 1.12 of FRS102:

(a) No cash flow statement has been presented for the company.
(b) Disclosures in respect of financial instruments have not been presented..

Going concern

The directors, having assessed the business risks and the potential ongoing impact of Brexit and giving due consideration to the profitability of the business and the cash flow required to meet its on-going obligations, consider it appropriate to prepare the financial statements on a going concern basis.

The company has 2 zero coupon notes with maturity date in 2024. In the event that the notes are not extended or replaced, the directors are satisfied that the company will have sufficient liquid resources to repay the balances in full as they fall due. Thus, they continue to adopt the going concern basis in preparing this management report.

Exemption from preparing group accounts

The financial statements contain information about Fluxys UK Limited as an individual company and do not contain consolidated financial information as the parent of a group.
The company is exempt under section 401 of the Companies Act 2006 from the requirement to prepare consolidated financial statements as it and its subsidiary undertakings are included by full consolidation in the consolidated financial statements of Fluxys SA, a company incorporated in Belgium.

 

Fluxys UK Limited

Notes to the Financial Statements for the Year Ended 31 December 2022

Foreign currency transactions and balances

Transactions in foreign currencies are initially recorded at the functional currency rate prevailing at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated into the respective functional currency of the entity at the rates prevailing on the reporting period date. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rate on the date when the fair value is re-measured.

Non-monetary items measured in terms of historical cost in a foreign currency are not retranslated.

Tax

The tax expense for the period comprises current tax. Tax is recognised in profit or loss, except that a change attributable to an item of income or expense recognised as other comprehensive income is also recognised directly in other comprehensive income.

The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the company operates and generates taxable income.

Investments

Investments in equity shares which are publicly traded or where the fair value can be measured reliably are initially measured at fair value, with changes in fair value recognised in profit or loss. Investments in equity shares which are not publicly traded and where fair value cannot be measured reliably are measured at cost less impairment.

Interest income on debt securities, where applicable, is recognised in income using the effective interest method.
Dividends on equity securities are recognised in income when receivable.

Cash and cash equivalents

Cash and cash equivalents comprise cash on hand and call deposits, and other short-term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of change in value.

Trade creditors

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if the company does not have an unconditional right, at the end of the reporting period, to defer settlement of the creditor for at least twelve months after the reporting date. If there is an unconditional right to defer settlement for at least twelve months after the reporting date, they are presented as non-current liabilities.

Trade creditors are recognised initially at the transaction price and subsequently measured at amortised cost.

Share capital

Ordinary shares are classified as equity. Equity instruments are measured at the fair value of the cash or other resources received or receivable, net of the direct costs of issuing the equity instruments. If payment is deferred and the time value of money is material, the initial measurement is on a present value basis.

Dividends

Dividend distribution to the company’s shareholders is recognised as a liability in the financial statements in the reporting period in which the dividends are declared. Interim dividends are recognised when paid.

 

Fluxys UK Limited

Notes to the Financial Statements for the Year Ended 31 December 2022

Financial instruments

Classification
A financial asset or a financial liability is recognised only when the entity becomes a party to the contractual provisions of the instrument.

 Recognition and measurement
Basic financial instruments are initially recognised at the transaction price, unless the arrangement constitutes a financing transaction, where it is recognised at the present value of the future payments discounted at a market rate of interest for a similar debt instrument.

Debt instruments are subsequently measured at amortised cost.

All other investments are measured at cost less impairment.

 Impairment
Financial assets that are measured at cost or amortised cost are reviewed for objective evidence of impairment at the end of each reporting date. If there is objective evidence of impairment, an impairment loss is recognised in profit or loss immediately.

For all equity instruments regardless of significance, and other financial assets that are individually significant, these are assessed individually for impairment. Other financial assets are either assessed individually or grouped on the basis of similar credit risk characteristics.

Judgements and Key sources of estimation uncertainty

The preparation of financial statements requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the group’s accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant are primarily related to potential impairments.

Judgements and estimates are based on prior experiences and on additional knowledge obtained on relevant transactions.

For investments this is specific to the business of each of the underlying subsidiaries, the current and future economic climate and the regulatory environment.

It involves, amongst others, estimates around the future level of revenues, capital and operating expenses, inflation and interest rates.

3

Operating loss

Arrived at after charging/(crediting)

2022

2021

Fees for management, accounting, legal treasury services

86,159

84,383

Fees for tax consulting

7,578

22,574

Auditor's remuneration for the audit of the company

15,502

28,520

 

Fluxys UK Limited

Notes to the Financial Statements for the Year Ended 31 December 2022

4

Staff costs

The average number of persons employed by the company (including directors) during the year, was as follows:

2022
No.

2021
No.

2

2

Directors are remunerated by other group undertakings. Their service to this entity is deemed incidental.

5

Other interest receivable and similar income

2022

2021

Interest received from group undertakings

297,405

-

6

Interest payable and similar expenses

2022

2021

Interest expense on other finance liabilities

328

162

Foreign exchange gains/(losses)

544,523

(105,971)

Interest payable on loans from group undertakings

2,040,101

2,064,596

2,584,952

1,958,787

7

Taxation

Tax charged/(credited) in the profit and loss account

2022

2021

Current taxation

UK corporation tax

(368,635)

(293,765)

The tax on profit before tax for the year is lower than the standard rate of corporation tax in the UK (2021 - lower than the standard rate of corporation tax in the UK) of 19% (2021 - 19%). The differences are reconciled below:

2022

2021

Profit before tax

62,674,941

12,476,885

Corporation tax at standard rate

11,908,239

2,370,608

Effect of income exempt from taxation

(14,560,926)

(5,274,048)

Effect of expense not deductible in determining taxable profit (tax loss)

2,200,243

2,510,948

Increase in UK and foreign current tax from adjustment for prior periods

-

123,207

Tax increase/(decrease) arising from group relief

83,809

(24,480)

Total tax credit

(368,635)

(293,765)

 

Fluxys UK Limited

Notes to the Financial Statements for the Year Ended 31 December 2022

8

Investments

2022

2021

Investments in subsidiaries

212,362,386

223,942,615

Subsidiaries

Cost or valuation

At 1 January 2022

305,302,537

Provision

At 1 January 2022

81,359,922

Provision

11,580,229

At 31 December 2022

92,940,151

Carrying amount

At 31 December 2022

212,362,386

At 31 December 2021

223,942,615

Investments are assessed for indicators of impairment at each balance sheet date. An impairment loss was recognised in profit or loss resulting from a change in recoverable amount of an investment. This area involves a high degree of management judgement and complexity.

Details of undertakings

Details of the investments in which the company holds 20% or more of the nominal value of any class of share capital are as follows:

Undertaking

Registered office /
Incorporated in

Holding

Proportion of voting rights and shares held

     

2022

2021

Subsidiary undertakings

Gas Management Services Limited

Clarendon House
Clarendon Road
Cambridge
CB2 8FH

England & Wales

Ordinary

100%

100%

Interconnector Limited

15-16 Buckingham Street
London
England
WC2N 6DU

England & Wales

Ordinary

76%

76%

Interconnector Zeebrugge Terminal BV

Rue Guimard 4
1040 Etterbeek
Brussels

Belgium

Ordinary 'A'

26%

26%

 

Fluxys UK Limited

Notes to the Financial Statements for the Year Ended 31 December 2022


Interconnector Zeebrugge Terminal BV is a subsidiary as Fluxys UK Limited has control as a result of it's 26% direct interest and the 36.48% indirect interest held through Interconnector Limited.

Subsidiary undertakings

Gas Management Services Limited

The principal activity of Gas Management Services Limited is that of providing software and 24hr dispatching services to gas and power shippers and facility operators.

Interconnector Limited

The principal activity of Interconnector Limited is the operation of a subsea gas pipeline and terminal facilities to provide bi-directional gas transportation and ancillary services between the UK and continental European energy markets.

Interconnector Zeebrugge Terminal BV

The principal activity of Interconnector Zeebrugge Terminal BV is the operation and maintenance of gas terminal facilities at Zeebrugge, Belgium.

9

Debtors

Current

Note

2022

2021

Amounts owed by related parties

14

61,819,041

15,144,094

10

Cash and cash equivalents

2022

2021

Cash at bank

218,416

218,744

11

Creditors

Note

2022

2021

Due within one year

 

Trade creditors

 

-

15,501

Accruals

 

26,214

-

 

26,214

15,501

Due after one year

 

Other non-current financial liabilities due to related parties

14

140,946,099

138,905,998

Non-current financial liabilities due after one year as at 31 December 2022 include:

Zero coupon note denominated in EUR with nominal value of £101m and due date 28 February 2024 (all-in rate 1.590 %)

Zero coupon note denominated in EUR with nominal value of £42.5m and due date 27 May 2024 (all-in rate 1.220 %)

 

Fluxys UK Limited

Notes to the Financial Statements for the Year Ended 31 December 2022

Status of the Zero Coupon Note
The Zero Coupon Note constitutes unsecured and unsubordinated obligations of the Company.
The payment obligations of the Company under the Zero Coupon Note shall, save for such exceptions as may be provided by applicable legislation, at all times rank pari passu equally and rateably without discrimination or preference with all its other present and future unsecured and unsubordinated obligations.

12

Share capital

Allotted, called up and fully paid shares

 

2022

2021

 

No.

No.

Ordinary shares of €0.82 each

79,200,000

64,843,221

79,200,000

64,843,221

         

Shares reserved for issue

Ordinary shares with an aggregate nominal value of € 116,503 remain allotted but uncalled.
The number of shares reserved for issue is 100,000.

13

Dividends

Interim dividends paid

   

2022

 

2021

Interim dividend of €0.3788 (2021 - €0.1263) per each Ordinary shares

 

30,000,000

 

10,000,000

         

14

Related party transactions

Group

Details of the group relationships are disclosed in Note 15.

The company’s operating expenses for the year ended 31 December 2022 included related party transactions in relation to services paid to Fluxys Europe SA. These services included Corporate Services and Corporate
Business Support Services.

The company has a cash pooling agreement with Fluxys SA. As of September 2022, interest was received because of increasing interest rates.

The company has a loan agreement with Fluxys SA. During the year ended 31 December 2022, the company incurred financial costs related to the loan agreement payable to Fluxys SA.

 

Fluxys UK Limited

Notes to the Financial Statements for the Year Ended 31 December 2022

Transactions with related parties:

2022

2021

Fluxys and associated companies

Operating expenses

65,583

78,875

Dividends paid

30,000,000

10,000,000

Interest received

(297,405)

-

Interest paid

2,040,101

2,064,596

Amounts outstanding at year end:

Cash pooling (included within amounts owed by related parties)

61,033,434

14,727,122

Outstanding loan (included within amounts owed by related parties)

(140,946,099)

(138,905,998)

Company

As mentioned in note 8, Gas Management Services Limited (GMSL) and Interconnector Limited (Interconnector) are fully and partly-owned subsidiaries of the company. Details of transactions and balances, which fully eliminate on consolidation in the group financial statements, are set out below.

Transactions with subsidiary undertakings:

2022

2021

Dividends income

GMSL

4,793,556

5,463,549

Interconnector

71,842,898

22,294,597

The company had the following balances outstanding at 31 December (to)/from subsidiary undertakings:

GMSL - Tax receivable

79,316

56,646

Interconnector - Tax receivable

706,291

360,326

The group participates in a corporation tax group settlement arrangement, whereby the company settles corporation tax liabilities on behalf of wholly- owned subsidiaries. The corporation tax liability is included in the amounts owed by subsidiary undertakings at year-end, as disclosed in the table above.

Commitments and guarantees

No guarantees were granted by the company.

15

Parent and ultimate parent undertaking

The company's immediate parent is Fluxys Europe SA, incorporated in Belgium.

 The ultimate parent is Publigas SA, incorporated in Belgium.

 The most senior parent entity producing publicly available financial statements is Publigas SA. These financial statements are available upon request from Galerie Ravenstein 4, 1000 Brussels, Belgium

 The ultimate controlling party is Publigas SA.

 

Fluxys UK Limited

Notes to the Financial Statements for the Year Ended 31 December 2022

The parent of the largest group in which these financial statements are consolidated is Publigas SA, incorporated in Belgium.

The address of Publigas SA is:
Galerie Ravenstein 4, 1000 Brussels, Belgium

These consolidated financial statements are available at this address.

The parent of the smallest group in which these financial statements are consolidated is Fluxys SA, incorporated in Belgium.

The address of Fluxys SA is:
Avenue des Arts 31, B-1040 Brussels, Belgium

These consolidated financial statements are available at this address.

16

Subsequent events

There are no events subsequent to the balance sheet date that require disclosure or adjustment in the financial statements.