The director presents the strategic report for the period ended 31 October 2023.
During the year the group's trading companies were SDSDAB Limited and A&B Glass Company Limited. As a result of strong demand in construction, A&B Glass operated throughout the year at full, or close to full capacity. Turnover for the year at £30,937,837 was 11% higher than £27,894,988 for the prior year ended 31 October 2022. However, price rather than volume was the main driver of growth, and although operating profit was broadly in line with 2022, in percentage terms it dropped from 4.0% to 3.1%.
The company’s inability to pass on higher input prices and overhead costs (particularly labour costs), resulted in a reduction in profit for the year from £855,436 to £536,578.
SDSDAB Limited turnover for the year at £1,240,544 was higher than £1,193,937 for the year ended 31 October 2022, and lower overheads meant that profit before tax of £837,712 was significantly higher than £123,611 the previous year. SDSDAB profitability is likely to reduce in future accounting periods no new lease arrangements are planned to replace existing leases come to an end.
As this is the group's first trading period, there are no comparatives. For the period ended 31 October 2023 the group's turnover was £29,365,871 with a profit before tax of £1,236,785.
Business environment
The industry has traditionally been extremely competitive, and the group has always faced intense price pressure in the marketplace.
Throughout 2021 & 2022 the industry faced a combination of supply chain issues and both general and industry-specific cost inflation. While these factors eased somewhat over the last year, this has been offset by increased customer reluctance to accept any upward price movement, particularly as demand eased towards the end of the financial year.
Strategy
The group continues to service the newbuild and commercial refurbishment sectors.
At the date of this report, the director has no plans to materially change this strategy.
Future outlook
Despite the macro-economic uncertainty and industry-specific challenges, the group has a sizeable order book and will continue to work diligently to protect margins and profitability wherever possible. During the year the group’s investment in the integrated service hub contributed to improved response and customer satisfaction levels, which have become an increasingly important KPI for both newbuild and commercial customers.
In 2022 the group started a significant capital project to replace old production machinery and this will continue throughout 2024 and beyond. It is hoped that increased levels of automation will both increase product quality and enable the redeployment and upskilling of much of the production team.
The director has considered the principal risks and uncertainties during the coming year, many of which are driven by factors which cannot be controlled, or which are difficult to predict.
The key business risk affecting the group's financial performance is considered to be 'the UK economy. The director will closely monitor the impact of this and the risk factors below and will take swift strategic action should the need arise.
Price Risk
The group is exposed to increasing commodity price risk as a result of its purchasing requirements. The director continually monitor prices, but in the current economic climate, the ability to fix prices or engage alternative suppliers is effectively non-existent.
Credit Risk
The group has policies that require appropriate health checks on both potential and existing customers. This credit risk is managed on a proactive basis through the sales process through to debt collection and recovery.
Liquidity Cashflow Risk
Cashflow and liquidity risk is managed and minimised by diligent management of the credit control function, and credit terms are strictly enforced. In order to maintain the group’s invoice discounting facility, the business insures virtually all debts and maintains a broad spread of customers in all divisions.
Brexit Risk
The group's turnover for the year has been derived from its principal activity wholly undertaken in the United Kingdom. The directors see currency fluctuations as a result of purchasing requirements as the main Brexit risk.
The director considers that the key financial indicators of the business are turnover, gross profit, operating profit, net bank borrowings and short term liquidity. The Director and senior management continually monitor and report on these financial KPls and are satisfied with the group's performance in relation to them.
Other performance indicators
An important non-financial KPI is the reportable accidents per employee of which there were none in the current or prior period.
On behalf of the board
The director presents his annual report and financial statements for the period ended 31 October 2023.
The results for the period are set out on page 9.
No ordinary dividends were paid. The director does not recommend payment of a further dividend.
The director who held office during the period and up to the date of signature of the financial statements was as follows:
The group's treasury activities are operated within policies and procedures approved by the Board, which include defined controls on the use of financial instruments managing the group's risk.
The group finances its operations by a mixture of retained profits, cash, and an invoice discounting facility
Engagement with employees
The group is an equal opportunity employer and is committed to ensuring no employee or applicant is treated less favourably on grounds of age, race, religion, gender, ethnic origin, disability or sexual orientation.
The group continues to support the employment of disabled persons, wherever practicable, and to ensure that they share in the training, career development and promotion opportunities available to all employees.
As the group has adjusted to macro-economic changes and industry-specific pressures employees have continued to adapt superbly to generate efficiency gains and cost savings throughout the business. As pressure on margins have become more acute, this is a significant contributor to the year’s results.
The director is hugely appreciative of these efforts and would like to thank everyone for all their hard work, not just for the last twelve months, but from May 2020 when internal and external problems meant the group faced an uncertain future. He also recognises that moving forward, employee engagement is crucial to staff recruitment, development and retention.
Engagement with suppliers, customers and others
The group is reliant on a small number of key suppliers, most of whom are industry-specific. Close working relationships have always been key and particularly so since May 2020 as the industry has faced significant challenges maintaining continuity of supply in the light of worldwide shortages of raw materials and reduction in shipping capacity.
Both the newbuild and commercial divisions of the group operate in a very price-competitive environment and have a relatively small number of large customers. These customers provide the business with long term contract work.
As detailed in the Strategic Report, the group changed funders and bankers during the year, and managing relationships with both are crucial. This involves ensuring access to funding, the management of headroom and cashflow; together with the smooth interaction between internal and external personnel.
There are no material post balance sheet events to report.
Ensors Accountants LLP were appointed as auditor to the group and in accordance with section 485 of the Companies Act 2006, a resolution proposing that they be re-appointed will be put at a General Meeting.
The group's business activities, together with the factors likely to affect its future development, performance and position are set out in the Strategic Report.
The director has reviewed the group's recent trading performance and its forecasts through to October 2024 to assess the required level of finance. In their consideration of going concern, the director has reviewed the cash forecasts and revenue projections, which they believe are prudent. Forecasts for the year ended 31 October 2024 show that the group will remain profitable and there is sufficient headroom in the available funding facility to continue as a going concern and meet its liabilities as they fall due.
The group's trading entities are well-established and have long-standing relationships with both customers and suppliers. The steadily increasing turnover, consistent profitability and positive cash generation over the last three years have all given the director confidence that the group enjoys a new-found flexibility that will allow it to adapt to challenges to the commercial environment that may arise in the future. For these reasons the director adopts the going concern basis in preparing these financial statements.
This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.
We have audited the financial statements of A & B Glass Group Limited (the 'parent company') and its subsidiaries (the 'group') for the period ended 31 October 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).
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 director's 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 director 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 director is responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit:
the information given in the strategic report and the director's report for the financial period for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the director's report have been prepared in accordance with applicable legal requirements.
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 director's 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 by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or
the parent company 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.
As explained more fully in the director's responsibilities statement, the director is 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 director determines 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 director is 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 director either intends to liquidate the parent company or to cease operations, or has no realistic alternative but to do so.
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
In identifying and assessing risks of material misstatement in respect of irregularities, including fraud, the audit engagement team:
obtained an understanding of the nature of the industry and sector, including the legal and regulatory framework that the company and group operates in and how the company and group are complying with the legal and regulatory framework;
inquired of management, and those charged with governance, about their own identification and assessment of the risks of irregularities, including any known actual, suspected or alleged instances of fraud;
audited the risk of management override of controls, including through testing journal entries and other adjustments for appropriateness;
discussed matters about non-compliance with laws and regulations and how fraud might occur including assessment of how and where the financial statements may be susceptible to fraud;
reviewed and challenged accounting estimates to ensure no indication of management bias.
However, it is the primary responsibility of management, with the oversight of those charged with governance, to ensure that the entity's operations are conducted in accordance with the provisions of laws and regulations and for the prevention and detection of fraud.
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.
These financial statements have been prepared in accordance with the provisions relating to medium-sized groups.
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 year was £399,956.
A & B Glass Group Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is .
The group consists of A & B Glass Group Limited and all of its subsidiaries.
These financial statements are presented for the period between 11 November 2022 and 31 October 2023, a period of less than one year, due to alignment with the statutory year-ends of the other companies within the group. The company was incorporated, and trade commenced, on 11 November 2022.
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
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:
Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;
Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.
The consolidated group financial statements consist of the financial statements of the parent company A & B Glass 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 31 October 2023. 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.
Subsidiaries are consolidated in the group’s financial statements from the date that control commences until the date that control ceases.
At the time of approving the financial statements, the director has a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future. Thus the director continues to adopt the going concern basis of accounting in preparing the financial statements.
Turnover is recognised at the fair value of the consideration received or receivable for the sale of 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.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on delivery of the goods and, where applicable installation), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.
Revenue from contracts for the provision of services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to labour costs and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that it is probable will be recovered.
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.
In the parent company financial statements, investments in subsidiaries 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.
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.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
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, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
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.
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, 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.
The Group has an invoice discounting agreement. The amount owed by customers to the Group is included within trade debtors and the amount owed to the invoice discounting company is included within creditors. The amount owed to the invoice discounting company represents the difference between the amounts advanced by the discounting company and the invoices discounted. The interest element of the invoice discounting charges and other related costs are recognised as they accrue and included in the Statement of Comprehensive Income within interest payable and similar expenses.
Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.
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.
The tax expense represents the sum of the tax currently payable and deferred 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.
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.
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
Equity-settled share-based payments are measured at fair value at the date of grant by reference to the fair value of the equity instruments granted using the Black-Scholes model. The fair value determined at the grant date is expensed on a straight-line basis over the vesting period, based on the estimate of shares that will eventually vest. A corresponding adjustment is made to equity.
The expense in relation to options over the parent company’s shares granted to employees of a subsidiary is recognised by the company as a capital contribution, and presented as an increase in the company’s investment in that subsidiary.
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.
Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.
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.
In the application of the group’s accounting policies, the director is required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.
In categorising leases as finance leases or operating leases, management makes judgements as to whether significant risks and rewards of ownership have transferred to the company and group as a lessee.
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.
The cost element of stock carried forward in the statement of financial position is estimated by the directors based on raw material cost plus an appropriate proportion of labour and overheads. This therefore represents a critical accounting estimate arrived at by the directors based on their experience.
In determining whether there are indicators of impairment of the company's tangible and intangible assets management make judgements. The factors taken into consideration in reaching such a decision include the economic viability and expected future financial performance of the asset.
Using the information available at the statement of financial position date, the directors make judgements based on their experience on the level of impairment required for stock and trade debtors and the provision for future warranty costs. Further information received after the statement of financial position date may impact on the level of provision.
The group applies its policies on turnover and long term contracts when recognising revenue and profit on partially completed contracts. The application of this policy requires judgements to be made in respect of the total expected costs to complete and the profit margin achievable on each contract. The company has in place established internal control processes to ensure that the evaluation of costs and revenues is based upon appropriate estimates.
The whole of the turnover is attributable to the principal business activity.
All turnover arose within the United Kingdom.
The average monthly number of persons (including directors) employed by the group and company during the period was:
Their aggregate remuneration comprised:
The actual charge for the period can be reconciled to the expected charge/(credit) for the period based on the profit or loss and the standard rate of tax as follows:
Impairment tests have been carried out where appropriate and the following impairment losses have been recognised in profit or loss:
The impairment losses in respect of financial assets are recognised in other gains and losses in the profit and loss account.
More information on impairment movements in the period is given in note 10.
The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.
Details of the company's subsidiaries at 31 October 2023 are as follows:
* All these subsidiary undertakings under S394A and S448A of the Companies Act 2006 are exempt from preparing and filing individual accounts. These companies have taken exemption in S479A of the Companies Act 2006 from the requirements in the Act for their individual accounts to be audited.
The invoice financing is secured by a fixed and floating charge over the Companies assets and undertakings.
Obligations under hire purchase are secured on the underlying assets.
Amounts owed to group undertakings are interest free and repayable on demand.
The long-term loan has been part guaranteed by the UK Government under the Coronavirus Business Interruption Loan scheme ("CBILS"), The guarantee provides a partial guarantee, should the Group default on repaying the CBILS facility.
The Group borrowed £500,000 from IGF Business Credit Limited during the year ended 31 October 2021 under the CBILS. The loan is being repaid over a loan term of three years from the date the loan is first drawn down. Interest will be charged at 5.95% per annum over the base rate of National Westminster bank plc (currently 5.25%).
Obligations under hire purchase contracts are secured on the underlying assets.
The warranty provision relates to potential costs arising under a warranty on products. The provision is based on expected costs to be incurred based on previous warranty claims.
The following are the major deferred tax liabilities and assets recognised by the group and company, and movements thereon:
The deferred tax liabilities set out above mainly relate to accelerated capital allowances that are expected to reverse over the period that the underlying fixed assets are depreciated.
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.
Share based payment arrangements (share options) in respect of Directors involving a total of 102,273 Ordinary Shares of £0.10 with and exercise price of £0.10 per share were granted in May 2023. The options are exercisable in the event of a sale. Any share based payment charge is anticipated to be immaterial.
The profit and loss account reserve represents cumulative profit and loss net of distributions to owners.
On 15 November 2022 the group acquired 100 percent of the issued capital of SDSDAB Limited and its wholly owned subsidiaries.
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:
Amounts contracted for but not provided in the financial statements:
The remuneration of key management personnel is as follows.