Company registration number 04719079 (England and Wales)
NETGEM UK LIMITED
FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
PAGES FOR FILING WITH REGISTRAR
NETGEM UK LIMITED
CONTENTS
Page
Balance sheet
1
Statement of changes in equity
2
Notes to the financial statements
3 - 9
NETGEM UK LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2022
31 December 2022
- 1 -
2022
2021
Notes
£
£
£
£
Fixed assets
Tangible assets
3
347,594
279,239
Current assets
Stocks
188,653
205,114
Debtors
4
4,448,243
2,099,318
Cash at bank and in hand
525,487
392,436
5,162,383
2,696,868
Creditors: amounts falling due within one year
5
(4,061,052)
(1,650,158)
Net current assets
1,101,331
1,046,710
Net assets
1,448,925
1,325,949
Capital and reserves
Called up share capital
1,000
1,000
Capital contribution
6
406,665
377,148
Profit and loss reserves
6
1,041,260
947,801
Total equity
1,448,925
1,325,949

The directors of the company have elected not to include a copy of the profit and loss account within the financial statements.true

These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies regime.

The financial statements were approved by the board of directors and authorised for issue on 27 November 2023 and are signed on its behalf by:
Mr S Thevenot
Director
Company Registration No. 04719079
NETGEM UK LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2022
- 2 -
Share capital
Capital contribution
Profit and loss reserves
Total
Notes
£
£
£
£
Balance at 1 January 2021
1,000
370,740
855,736
1,227,476
Year ended 31 December 2021:
Profit and total comprehensive income for the year
-
-
92,065
92,065
Credit to equity for equity settled share-based payments
-
6,408
6,408
Balance at 31 December 2021
1,000
377,148
947,801
1,325,949
Year ended 31 December 2022:
Profit and total comprehensive income for the year
-
-
93,459
93,459
Credit to equity for equity settled share-based payments
-
29,517
-
29,517
Balance at 31 December 2022
1,000
406,665
1,041,260
1,448,925
NETGEM UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
- 3 -
1
Accounting policies
Company information

Netgem UK Limited is a private company limited by shares incorporated in England and Wales. The registered office is Bank Chambers, 6-10 Borough High Street, London, SE1 9QQ.

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 as applicable to companies subject to the small companies regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.

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.

1.2
Going concern

The Directors are confident about the Outlook for Netgem UK ltd, based on the fact that several multi-year distribution agreements have been signed, and that the demand in the market for 'TV streaming services' is increasing, in association with the distribution of Broadband services (primary distribution channels of Netgem TV), fuelled by more Content available to stream as well as an acceleration of switching to 'Full Fibre' Broadband thanks to large infrastructure investments.  true

 

Additionally, the company is making a profit, and has reasonable prospects based on the above to continue to do so. In terms of treasury, the company is benefiting from the cash pooling mechanism at the Group level to fund its growth plans (particularly the investments in TV boxes), so in this context, the Directors have concluded that the company will be able to carry on business as a going concern and settle its obligations as they fall due for a period of at least twelve months from the signature of these financial statements.

1.3
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.

 

When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income.

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 dispatch of the goods), 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.

Rental revenue from the provision of renting and leasing TV boxes is recognised evenly over the period of the contract.

1.4
Research and development expenditure

Research and development expenditure is written off against profits in the year in which it is incurred.

1.5
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.

NETGEM UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 4 -

Depreciation is recognised so as to write off the cost of assets less their residual values over their useful lives on the following bases:

Leasehold land and buildings
33% straight line
Plant and equipment
33% straight line
Fixtures and fittings
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 credited or charged to profit or loss.

1.6
Impairment of fixed assets

At each reporting period end date, the company reviews the carrying amounts of its tangible 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.

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.

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.

1.7
Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

1.8
Cash and cash equivalents

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

NETGEM UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 5 -
1.9
Financial instruments

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

 

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

 

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

Basic financial assets

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

Classification of financial liabilities

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

Basic financial liabilities

Basic financial liabilities, including creditors, bank loans, loans from fellow group companies, 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.

1.10
Equity instruments

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

1.11
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 company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

NETGEM UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 6 -
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 when the company has 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.

1.12
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.

 

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.

1.13
Retirement benefits

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

1.14
Share-based payments

The company's employees participates in a share-based payment arrangement granted to its employees by its parent company. The fair value at the date of grant is measured 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 an estimate of shares that will eventually vest. A corresponding adjustment is made to equity and shown as a capital contribution.

1.15
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 leases asset are consumed.

1.16
Foreign exchange

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.

NETGEM UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 7 -
2
Employees

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

2022
2021
Number
Number
Total
14
11
3
Tangible fixed assets
Land and buildings
Assets held for lease
Total
£
£
£
Cost
At 1 January 2022
25,632
598,225
623,857
Additions
-
0
243,751
243,751
At 31 December 2022
25,632
841,976
867,608
Depreciation and impairment
At 1 January 2022
25,632
318,986
344,618
Depreciation charged in the year
-
0
175,396
175,396
At 31 December 2022
25,632
494,382
520,014
Carrying amount
At 31 December 2022
-
0
347,594
347,594
At 31 December 2021
-
0
279,239
279,239
4
Debtors
2022
2021
Amounts falling due within one year:
£
£
Trade debtors
3,372,680
1,250,360
Corporation tax recoverable
103,748
322,221
Other debtors
60,798
36,271
Prepayments and accrued income
911,017
490,466
4,448,243
2,099,318
NETGEM UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 8 -
5
Creditors: amounts falling due within one year
2022
2021
£
£
Trade creditors
146,083
109,964
Amounts owed to group undertakings
1,975,044
728,516
Corporation tax
-
0
12,367
Other taxation and social security
158,637
163,716
Other creditors
-
0
26,508
Accruals and deferred income
1,781,288
609,087
4,061,052
1,650,158
6
Reserves
Capital contribution

The capital contribution relates to accumulated share based payment charges which are expected to be settled by the company's parent company for no consideration by Netgem UK Limited.

Profit and loss reserves

This reserve represents cumulative profit and losses for Netgem UK Limited.

7
Operating lease commitments
Lessee

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

2022
2021
£
£
327,010
65,735
8
Events after the reporting date

There are no post balance sheet events to be reported.

9
Related party transactions
Transactions with related parties

During the year the company entered into the following transactions with related parties:

Expenses
2022
2021
£
£
Other related parties
114,344
246,569
NETGEM UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
9
Related party transactions
(Continued)
- 9 -

The following amounts were outstanding at the reporting end date:

2022
2021
Amounts due to related parties
£
£
Other related parties
68,695
29,501

The company is a wholly owned member of Netgem's group, and as such has taken advantage of the exemption permitted by FRS102 1A related party disclosure, not to provide disclosures of transaction entered into with other wholly owned members of the group.

10
Parent company

The company's ultimate parent undertaking and controlling party is Netgem S.A., a company incorporated in France (R.C.S Nanterre 408 024 578). Copies of its consolidated financial statements, in which the company is included, are available from its registered office: Le Colisée, 10 avenue de l'Arche, 92419 Courbevoie, France.

 

Netgem S.A. is the smallest and largest group for which group accounts are prepared and which includes Netgem UK Limited in its consolidated financial statements.

11
Audit report information

As the income statement has been omitted from the filing copy of the financial statements, the following information in relation to the audit report on the statutory financial statements is provided in accordance with s444(5B) of the Companies Act 2006:

The auditor's report was unqualified.

The senior statutory auditor was Yuvan Deena and the auditor was Mazars LLP.
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