Company registration number 02778086 (England and Wales)
PADLEY & VENABLES LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
PADLEY & VENABLES LIMITED
COMPANY INFORMATION
Director
F M Brunner
Company number
02778086
Registered office
Callywhite Lane
Dronfield
S18 2XT
Auditor
BHP LLP
2 Rutland Park
Sheffield
S10 2PD
Business address
Callywhite Lane
Dronfield
S18 2XT
Bankers
National Westminster Bank plc
42 High Street
Sheffield
S1 2GE
PADLEY & VENABLES LIMITED
CONTENTS
Page
Strategic report
1
Director's report
2 - 3
Independent auditor's report
4 - 6
Profit and loss account
7
Statement of comprehensive income
8
Balance sheet
9
Statement of changes in equity
10
Statement of cash flows
11
Notes to the financial statements
12 - 28
PADLEY & VENABLES LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022
- 1 -
The director presents the strategic report for the year ended 31 December 2022.
Fair review of the business
Our objective is to present a balanced and practical review of the development and performance of our business during the year and its position at the year end. Our review is intended to reflect the size and nature of our business and is written in the context of the risks and uncertainties we face.
The company is a manufacturer of specialised Bar Steels and Consumable Accessories for use in the Mining and Construction Industries throughout the World. The Company’s activities are organised into two manufacturing divisions – Padley & Venables and Bedford Steels. In summary, the activities of the two divisions can be summarised as follows:-
Bedford Steels
Bedford Steels is a steel re-rolling facility, manufacturing a range of specialised Hollow and Solid Bar Sections for the Mining, Construction and General Engineering Industries. These products are supplied to manufacturers of consumable tools throughout the world.
Padley & Venables
Padley & Venables manufactures consumable tools for the Mining, Quarrying and Construction Industries. These products are divided into three main groups, Rock Drilling Accessories, Tools for boom mounted Breakers and Tools for hand held pneumatic/hydraulic Breakers. These products are marketed throughout the world, under two brand names, "P&V" and "Thomas Turton/Crossbow".
Key performance indicators
We consider that our key financial performance indicators are those that convey the financial performance and strength of the company as a whole, these being turnover, gross margin and return on capital employed.
Turnover increased to £27.5m (2021: £22.6m), gross profit increased to £5.4m (2021: £4.2m). Return on capital employed has increased by 4.83% (2021: 1.04%).
Principal risks and uncertainties
This year has seen a number of challenges and risks to the business. The post pandemic recovery has been slowed by the war in Ukraine which has caused significant price increases in energy and raw material.
High inflation has caused unease in the workforce as salaries have been under pressure to stay in-line. Staff retention and recruitment is still an issue as unemployment hovers around historic lows while the jobs market appears saturated.
However the business has continued to grow with healthy forward orders and increased turnover.
The company continues to pursue its strategy of continual investment in its employees, product development and plant and equipment in order to keep itself well positioned and ready to react positively to an ever changing environment.
F M Brunner
Director
31 January 2024
PADLEY & VENABLES LIMITED
DIRECTOR'S REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022
- 2 -
The director presents his annual report and financial statements for the year ended 31 December 2022.
Principal activities
The principal activity of the company is the manufacture of drilling equipment, demolition tools and rolled steel products.
Director
The director who held office during the year and up to the date of signature of the financial statements was as follows:
F M Brunner
Results and dividends
The results for the year are set out on page 7.
No ordinary dividends were paid. The director does not recommend payment of a final dividend.
Auditor
The auditor, BHP LLP, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
Statement of director's responsibilities
The director is responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.
Company law requires the director to prepare financial statements for each financial year. Under that law the director has 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 director must not approve the financial statements unless he is 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 director is required to:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The director is 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. He is 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.
PADLEY & VENABLES LIMITED
DIRECTOR'S REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 3 -
Statement of disclosure to auditor
So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.
On behalf of the board
F M Brunner
Director
31 January 2024
PADLEY & VENABLES LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF PADLEY & VENABLES LIMITED
- 4 -
Opinion
We have audited the financial statements of Padley & Venables Limited (the 'company') for the year ended 31 December 2022 which comprise the profit and loss account, the statement of comprehensive income, the balance sheet, the statement of changes in equity, the statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
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 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 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 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.
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 year 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.
PADLEY & VENABLES LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF PADLEY & VENABLES LIMITED
- 5 -
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the 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, 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 remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
Responsibilities of director
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 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 company or to cease operations, or has 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.
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.
We gained an understanding of the legal and regulatory framework applicable to the company and the industry in
which it operates, and considered the risk of such regulations, including fraud. We designed audit procedures to
respond to the risk, recognizing that the risk of not detecting a material misstatement due to fraud is higher than
the risk of not detecting one resulting from error.
We focused on laws and regulations relevant to the company which could give rise to a material misstatement
due in the financial statements. Our testing included discussions with management, directors and those staff
with direct responsibility for the compliance of laws and regulations, agreeing financial statement disclosures to
underlying supporting documentation, and reviewing legal expenses. There are inherent limitations in the audit
procedures described 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 would be come aware of it.
As part of our audit we addressed the risk of management override of internal controls, including testing of
journals and review of the nominal ledger. We challenged assumptions and judgements made by management
regarding significant accounting estimates. We evaluated whether there was evidence of bias by the directors
that represented a risk of material misstatement due to 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.
PADLEY & VENABLES LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF PADLEY & VENABLES LIMITED
- 6 -
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.
Terri Pierpoint
Senior Statutory Auditor
For and on behalf of BHP LLP
1 February 2024
Chartered Accountants
Statutory Auditor
PADLEY & VENABLES LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2022
- 7 -
2022
2021
Notes
£
£
Turnover
3
27,526,689
22,587,936
Cost of sales
(22,137,225)
(18,382,667)
Gross profit
5,389,464
4,205,269
Distribution costs
(2,451,457)
(2,086,904)
Administrative expenses
(1,879,534)
(1,907,503)
Operating profit
4
1,058,473
210,862
Interest receivable and similar income
7
58,117
49,749
Interest payable and similar expenses
8
(25,405)
Profit before taxation
1,091,185
260,611
Tax on profit
9
(178,512)
(410,954)
Profit/(loss) for the financial year
912,673
(150,343)
The profit and loss account has been prepared on the basis that all operations are continuing operations.
PADLEY & VENABLES LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2022
- 8 -
2022
2021
£
£
Profit/(loss) for the year
912,673
(150,343)
Other comprehensive income
Revaluation of tangible fixed assets
140,000
-
Actuarial (loss)/gain on defined benefit pension schemes
(1,452,000)
82,000
Tax relating to other comprehensive income
363,000
(20,500)
Other comprehensive income for the year
(949,000)
61,500
Total comprehensive income for the year
(36,327)
(88,843)
PADLEY & VENABLES LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2022
31 December 2022
- 9 -
2022
2021
Notes
£
£
£
£
Fixed assets
Tangible assets
12
4,890,586
5,404,133
Investment properties
13
434,418
294,418
Investments
14
8
8
5,325,012
5,698,559
Current assets
Stocks
15
17,238,137
12,928,233
Debtors
16
8,406,833
8,150,608
Cash at bank and in hand
1,558,115
2,399,161
27,203,085
23,478,002
Creditors: amounts falling due within one year
17
(5,281,699)
(3,181,836)
Net current assets
21,921,386
20,296,166
Total assets less current liabilities
27,246,398
25,994,725
Provisions for liabilities
(660,000)
(701,000)
Net assets excluding pension surplus
26,586,398
25,293,725
Defined benefit pension surplus
22
1,057,500
2,386,500
Net assets
27,643,898
27,680,225
Capital and reserves
Called up share capital
19
1,600,002
1,600,002
Revaluation reserve
20
140,000
Profit and loss reserves
25,903,896
26,080,223
Total equity
27,643,898
27,680,225
The financial statements were approved and signed by the director and authorised for issue on 31 January 2024
F M Brunner
Director
Company Registration No. 02778086
PADLEY & VENABLES LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2022
- 10 -
Share capital
Revaluation reserve
Profit and loss reserves
Total
Notes
£
£
£
£
Balance at 1 January 2021
1,600,002
28,424,834
30,024,836
Year ended 31 December 2021:
Loss for the year
-
-
(150,343)
(150,343)
Other comprehensive income:
Actuarial losses on defined benefit plans
-
-
82,000
82,000
Tax relating to other comprehensive income
-
(20,500)
(20,500)
Total comprehensive income for the year
-
-
(88,843)
(88,843)
Dividends
10
-
-
(2,255,768)
(2,255,768)
Balance at 31 December 2021
1,600,002
26,080,223
27,680,225
Year ended 31 December 2022:
Profit for the year
-
-
912,673
912,673
Other comprehensive income:
Revaluation of investment property
-
140,000
-
140,000
Actuarial gains on defined benefit plans
-
-
(1,452,000)
(1,452,000)
Tax relating to other comprehensive income
-
363,000
363,000
Total comprehensive income for the year
-
140,000
(176,327)
(36,327)
Balance at 31 December 2022
1,600,002
140,000
25,903,896
27,643,898
PADLEY & VENABLES LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2022
- 11 -
2022
2021
Notes
£
£
£
£
Cash flows from operating activities
Cash absorbed by operations
28
(286,825)
(189,089)
Interest paid
(25,405)
Income taxes paid
(195,152)
(46,021)
Net cash outflow from operating activities
(507,382)
(235,110)
Investing activities
Purchase of tangible fixed assets
(350,430)
(908,740)
Proceeds on disposal of tangible fixed assets
15,649
3,575
Interest received
1,117
749
Net cash used in investing activities
(333,664)
(904,416)
Financing activities
Dividends paid
(2,255,768)
Net cash used in financing activities
(2,255,768)
Net decrease in cash and cash equivalents
(841,046)
(3,395,294)
Cash and cash equivalents at beginning of year
2,399,161
5,794,455
Cash and cash equivalents at end of year
1,558,115
2,399,161
PADLEY & VENABLES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
- 12 -
1
Accounting policies
Company information
Padley & Venables Limited is a private company limited by shares incorporated in England and Wales. The registered office is Callywhite Lane, Dronfield, S18 2XT.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared on the historical cost convention, modified to include investment properties and certain financial instruments at fair value. The principal accounting policies adopted are set out below.
1.2
Going concern
Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
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.
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.
1.4
Intangible fixed assets - goodwill
Acquired goodwill is written off in equal annual instalments over its estimated useful economic life.
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.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Freehold land and buildings
2.5% straight line
Land and buildings Leasehold
2.5% straight line
Plant and machinery
5% - 16.6% straight line
Fixtures & fittings
16.6% straight line
Motor vehicles
25% straight line
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
PADLEY & VENABLES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 13 -
1.6
Investment properties
Investment property, which is property held to earn rentals and/or for capital appreciation, is measured using the fair value model and stated at its fair value as the reporting end date. The surplus or deficit on revaluation is recognised in the profit and loss account.
1.7
Fixed asset investments
Interests in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.
A subsidiary is an entity controlled by the company. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
1.8
Impairment of fixed assets
At each reporting period end date, the company 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.
1.9
Stocks
Stocks are stated at the lower of cost and net realisable value. Cost is based on standard costing principle with costs reviewed annually with reference to current cost and includes expenditure incurred in acquiring the stocks, production or conversion costs and other costs in bringing them to their existing location and condition. In the case of manufactured stocks and work in progress, cost includes an appropriate share of overheads based on normal operating capacity.
1.10
Cash and cash equivalents
Cash at bank and in hand are basic financial assets and include cash in hand and deposits held at call with banks.
1.11
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 statement of financial position when the company becomes party to the contractual provisions of the instrument.
Basic financial assets
Basic financial assets, which include trade and other receivables 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.
Other financial assets
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
PADLEY & VENABLES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 14 -
Impairment of financial assets
Financial assets 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. The impairment loss is recognised in profit or loss.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
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, including creditors and 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.
Other financial liabilities
Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
1.12
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.
Changes in the fair value of derivatives that are designated and qualify as fair value hedges are recognised in profit or loss immediately, together with any changes in the fair value of the hedged asset or liability that are attributable to the hedged risk.
1.13
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
PADLEY & VENABLES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 15 -
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.
Deferred tax
Deferred taxation is provided at appropriate rates on all timing differences using the liability method only to the extent that, in the opinion of the director, there is a reasonable probability that a liability or asset will crystallise in the foreseeable future.
1.14
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
1.15
Retirement benefits
The cost of providing benefits under defined benefit plans is determined separately for each plan using the projected unit credit method, and is based on actuarial advice.
The change in the net defined benefit liability arising from employee service during the year is recognised as an employee cost. The cost of plan introductions, benefit changes, settlements and curtailments are recognised as an expense in measuring profit or loss in the period in which they arise.
The net interest element is determined by multiplying the net defined benefit liability by the discount rate, taking into account any changes in the net defined benefit liability during the period as a result of contribution and benefit payments. The net interest is recognised in profit or loss as other finance revenue or cost.
Remeasurement changes comprise actuarial gains and losses, the effect of the asset ceiling and the return on the net defined benefit liability excluding amounts included in net interest. These are recognised immediately in other comprehensive income in the period in which they occur and are not reclassified to profit and loss in subsequent periods.
The net defined benefit pension asset or liability in the balance sheet comprises the total for each plan of the present value of the defined benefit obligation (using a discount rate based on high quality corporate bonds), less the fair value of plan assets out of which the obligations are to be settled directly. Fair value is based on market price information, and in the case of quoted securities is the published bid price. The value of a net pension benefit asset is limited to the amount that may be recovered either through reduced contributions or agreed refunds from the scheme.
1.16
Leases
Rentals payable under operating leases, including any lease incentives received, are charged to income on a straight line basis over the term of the relevant lease.
PADLEY & VENABLES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 16 -
2
Judgements and key sources of estimation uncertainty
In the application of the company’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.
Critical judgements
The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.
Stock valuation
In accordance with accounting policy 1.8, stock is based on standard costing. Management apply an uplift to stock valuation on an annual basis to account for the surcharges on stock purchased. Due to the economic environment management used a 24 month average to calculate the surcharge uplift as opposed to a 12 month average in the prior period.
3
Turnover and other revenue
An analysis of the company's turnover is as follows:
2022
2021
£
£
Turnover
Sales
27,526,689
22,587,936
In the opinion of the directors the disclosure of the geographical analysis of turnover would be seriously prejudicial to the interests of the company. This information has therefore not been disclosed.
4
Operating profit
2022
2021
Operating profit for the year is stated after charging/(crediting):
£
£
Exchange losses/(gains)
(403,556)
(154,646)
Fees payable to the company's auditors for the audit of the company's financial statements
32,880
28,530
Depreciation of owned tangible fixed assets
863,977
852,583
Profit on disposal of tangible fixed assets
(15,649)
(3,575)
Operating lease charges
36,109
32,638
PADLEY & VENABLES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 17 -
5
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2022
2021
Number
Number
Production
128
126
Selling and administration
68
65
196
191
Their aggregate remuneration comprised:
2022
2021
£
£
Wages and salaries
6,669,517
6,335,505
Social security costs
648,644
591,692
Pension costs
149,218
140,018
7,467,379
7,067,215
6
Director's remuneration
2022
2021
£
£
Remuneration for qualifying services
157,902
275,807
Remuneration disclosed above include the following amounts paid to the highest paid director:
Remuneration for qualifying services
157,902
275,807
7
Interest receivable and similar income
2022
2021
£
£
Interest income
Return on pension scheme asset
57,000
49,000
Other interest income
1,117
749
Total income
58,117
49,749
8
Interest payable and similar expenses
2022
2021
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts
25,405
-
PADLEY & VENABLES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 18 -
9
Taxation
2022
2021
£
£
Current tax
UK corporation tax on profits for the current period
254,360
Adjustments in respect of prior periods
(21,551)
Total UK current tax
254,360
(21,551)
Foreign current tax on profits for the current period
45,152
45,215
Total current tax
299,512
23,664
Deferred tax
Origination and reversal of timing differences
(41,000)
260,000
Other adjustments
(80,000)
127,290
Total deferred tax
(121,000)
387,290
Total tax charge
178,512
410,954
The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:
2022
2021
£
£
Profit before taxation
1,091,185
260,611
Expected tax charge based on the standard rate of corporation tax in the UK of 19.00% (2021: 19.00%)
207,325
49,516
Tax effect of expenses that are not deductible in determining taxable profit
20,357
Change in unrecognised deferred tax assets
(354)
Adjustments in respect of prior years
(21,551)
Double tax relief
(45,152)
(29,130)
Other permanent differences
(4,763)
(12,609)
Other tax adjustments
1,001
1,871
Foreign tax
45,152
45,214
Effect of change in deferred tax rates
(25,051)
357,640
Taxation charge for the year
178,512
410,954
PADLEY & VENABLES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
9
Taxation
(Continued)
- 19 -
In addition to the amount charged to the profit and loss account, the following amounts relating to tax have been recognised directly in other comprehensive income:
2022
2021
£
£
Deferred tax arising on:
Actuarial differences recognised as other comprehensive income
(363,000)
20,500
10
Dividends
2022
2021
£
£
Final paid
2,255,768
11
Intangible fixed assets
Goodwill
£
Cost
At 1 January 2022 and 31 December 2022
379,109
Amortisation and impairment
At 1 January 2022 and 31 December 2022
379,109
Carrying amount
At 31 December 2022
At 31 December 2021
PADLEY & VENABLES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 20 -
12
Tangible fixed assets
Freehold land and buildings
Land and buildings Leasehold
Plant and machinery
Fixtures & fittings
Motor vehicles
Total
£
£
£
£
£
£
Cost
At 1 January 2022
1,624,744
356,304
13,607,068
1,237,779
357,684
17,183,579
Additions
168,266
140,148
42,016
350,430
Disposals
(24,250)
(24,250)
At 31 December 2022
1,624,744
356,304
13,775,334
1,377,927
375,450
17,509,759
Depreciation and impairment
At 1 January 2022
938,874
189,974
9,548,470
787,990
314,138
11,779,446
Depreciation charged in the year
40,620
8,903
754,104
36,902
23,448
863,977
Eliminated in respect of disposals
(24,250)
(24,250)
At 31 December 2022
979,494
198,877
10,302,574
824,892
313,336
12,619,173
Carrying amount
At 31 December 2022
645,250
157,427
3,472,760
553,035
62,114
4,890,586
At 31 December 2021
685,870
166,330
4,058,598
449,789
43,546
5,404,133
13
Investment property
2022
£
Fair value
At 1 January 2022
294,418
Net gains or losses through fair value adjustments
140,000
At 31 December 2022
434,418
Investment property totalling £294,418 was purchased on 11 June 2007. The director believes that the value represents the current market value of the properties at 31 December 2022.
14
Fixed asset investments
2022
2021
Notes
£
£
Investments in subsidiaries
26
8
8
PADLEY & VENABLES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 21 -
15
Stocks
2022
2021
£
£
Raw materials and consumables
8,989,431
5,872,554
Work in progress
2,453,377
2,451,985
Finished goods and goods for resale
5,795,329
4,603,694
17,238,137
12,928,233
16
Debtors
2022
2021
Amounts falling due within one year:
£
£
Trade debtors
5,178,127
4,635,832
Corporation tax recoverable
351,606
201,606
Amounts owed by group undertakings
2,396,445
1,936,398
Other debtors
250,688
841,076
Prepayments and accrued income
229,967
535,696
8,406,833
8,150,608
17
Creditors: amounts falling due within one year
2022
2021
£
£
Trade creditors
2,746,488
2,448,082
Amounts due to fellow group undertakings
1,175,904
15,543
Corporation tax
254,360
Other taxation and social security
209,779
214,281
Other creditors
375,749
150,312
Accruals and deferred income
519,419
353,618
5,281,699
3,181,836
18
Deferred taxation
Deferred tax assets and liabilities are offset where the company has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:
Liabilities
Liabilities
2022
2021
Balances:
£
£
ACAs
650,000
701,000
Revaluations
10,000
-
660,000
701,000
PADLEY & VENABLES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
18
Deferred taxation
(Continued)
- 22 -
2022
Movements in the year:
£
Liability at 1 January 2022
701,000
Credit to profit or loss
(41,000)
Liability at 31 December 2022
660,000
19
Share capital
2022
2021
2022
2021
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
1,600,002
1,600,002
1,600,002
1,600,002
20
Revaluation reserve
2022
2021
£
£
At the beginning of the year
-
Revaluation surplus arising in the year
140,000
-
At the end of the year
140,000
-
21
Capital commitments
Amounts contracted for but not provided in the financial statements:
2022
2021
£
£
Acquisition of tangible fixed assets
-
32,919
PADLEY & VENABLES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 23 -
22
Retirement benefits
The group operates a defined benefit pension scheme the assets of which are held in a separate trustee administered fund. A full actuarial valuation of the scheme was carried out as at 5 April 2022.
The valuation used for FRS 102 disclosures has been based on a full assessment of the assets of the scheme as at 31 December 2022.
Amounts recognised in the balance sheet
2022
2021
£000
£000
Fair value of scheme assets
55,762
73,871
Present value of scheme liabilities
(37,088)
(56,825)
Surplus in the scheme
18,674
17,046
Effect of asset ceiling
(17,264)
(13,864)
1,410
3,182
Related deferred tax liability
(352)
(796)
Net pension surplus
1,058
2,386
Amounts recognised in the profit and loss account
2022
2021
£000
£000
Current service cost
389
382
Net interest cost
(57)
(49)
Administrative costs
(12)
(24)
Net pension cost recognised in the profit and loss account
320
309
Amounts recognised in other comprehensive income
Actuarial (gains) losses
(18,549)
1,309
Return on scheme assets (excluding interest income)
16,851
699
Changes in asset ceiling (excluding interest income)
3,150
(2,090)
Net (gain)/loss recognised in other comprehensive income
1,452
(82)
PADLEY & VENABLES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
22
Retirement benefits
(Continued)
- 24 -
Change in scheme assets
2022
2021
£000
£000
Fair value of scheme assets at 1 January 2022
73,871
75,390
Return on scheme assets (excluding interest income)
(16,851)
(699)
Insurance premiums for risk benefits
(8)
(9)
Member contributions
30
31
Benefits paid
(2,599)
(1,945)
Administrative costs
12
24
Interest income
1,307
1,079
Fair value of scheme assets at 31 December 2022
55,762
73,871
Total return on scheme assets
(15,544)
380
Change in scheme liabilities
2022
2021
£000
£000
Scheme liabilities at 1 January 2022
56,825
56,255
Current service cost
389
382
Loss on curtailment/changes/introductions
-
-
Interest cost
1,000
802
Member contributions
30
31
Benefits paid
(2,599)
(1,945)
Insurance premiums for risk benefits
(8)
(9)
Actuarial gains
(18,549)
1,309
Scheme liabilities at 31 December 2022
37,088
56,825
Principal weighted average actuarial assumptions
Assumptions used to determine the scheme liabilities:
%
%
Discount rate
5.00%
1.80%
Rate of salary increases
3.40%
3.70%
Rate of RPI price inflation
3.40%
3.70%
Rate of CPI price inflation
3.01%
3.31%
Assumptions used to determine the net pension cost:
Discount rate
1.80%
1.45%
Rate of salary increases
3.70%
3.15%
Rate of RPI price inflation
3.70%
3.15%
Rate of CPI price inflation
3.31%
2.15%
PADLEY & VENABLES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
22
Retirement benefits
(Continued)
- 25 -
Life expectancy assumptions on the post retirement mortality table used to determine benefit obligations:
2022
2021
Years
Years
Member age 65 (current life expectancy)
24.10
23.70
Member age 45 (life expectancy at age 65)
28.00
27.60
2022
2021
Balance sheet reconciliation
£000
£000
Surplus in the scheme at 1 January 2022
3,182
3,409
Recognised in the profit and loss account
(320)
(309)
Amounts recognised in other comprehensive income
(1,452)
82
Surplus in the scheme at 31 December 2022
1,410
3,182
Defined contribution scheme
The company also operates a defined contribution pension scheme. The assets of the scheme are held separately from those of the company in an independently administered fund. Employee and employer contributions totalling £2,646 (2021: £3,024) were payable to the fund at the year end and are included in creditors.
2022
2021
£000
£000
Charged to profit and loss account
140
140
PADLEY & VENABLES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 26 -
23
Related party transactions
Remuneration of key management personnel
The remuneration of key management personnel is as follows.
2022
2021
£
£
Aggregate compensation
525,206
644,236
Transactions with related parties
2022
2021
£
£
Aggregate sales made to group companies:
Brunner & Lay Inc.
1,944,151
244,354
Brunner Canada Inc.
1,899
-
Brunner & Lay Australia Pty
4,209,927
4,159,868
6,205,977
4,404,222
Aggregate purchases from group companies:
Brunner & Lay Inc.
163,052
209,350
Freight recharges:
Brunner & Lay Australia Pty
49,070
38,296
The amounts owed by/ to other group companies at the year end are as follows:
Amounts owed to Padley & Venables Limited by:
2022
2021
£
£
Brunner & Lay Inc.
1,795,539
949,461
Brunner & Lay Australia Pty
600,906
986,937
2,396,445
1,936,398
Amounts owed by Padley & Venables Limited to:
2022
2021
£
£
Brunner & Lay Inc.
1,173,061
14,750
Brunner & Lay Australia Pty
2,844
793
1,175,905
15,543
PADLEY & VENABLES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
23
Related party transactions
(Continued)
- 27 -
The company is owed £35,404 (2021: £60,324) by the Padley & Venables Pension Fund as at the year end.
The company also received a loan from Brunner and Lay Canada for £1,000,000 which is owing at the year end.
24
Ultimate controlling party
The company's ultimate parent undertaking is Brunner & Lay International Limited, a company incorporated in the USA. This is the only group to incorporate the results of the company.
25
Directors' transactions
Description
% Rate
Opening Balance
Amounts Advanced
Interest Charged
Amounts Repaid
Closing Balance
£
£
£
£
£
F M Brunner - Loan account
2.00
41,564
253,418
1,117
579,095
(282,996)
41,564
253,418
1,117
579,095
(282,996)
26
Subsidiaries
The company has four subsidiaries at a total cost of investment of £8. The companies, which are registered in England and Wales, are as follows:-
Name of undertaking and country of
Nature of business
Class of
incorporation or residency
shareholding
Bedford Rock Drill Components Limited
UK
Dormant
Ordinary
Crossbow Demolition Tools Limited
UK
Dormant
Ordinary
Crossbow Rock Drills Limited
UK
Dormant
Ordinary
Thomas Turton Limited
UK
Dormant
Ordinary
There is a 100% direct shareholding in each subsidiary listed above.
27
Analysis of changes in net funds
1 January 2022
Cash flows
31 December 2022
£
£
£
Cash at bank and in hand
2,399,161
(841,046)
1,558,115
PADLEY & VENABLES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 28 -
28
Cash absorbed by operations
2022
2021
£
£
Profit/(loss) for the year after tax
912,673
(150,343)
Adjustments for:
Taxation charged
178,512
410,954
Finance costs
25,405
Investment income
(1,117)
(749)
Gain on disposal of tangible fixed assets
(15,649)
(3,575)
Depreciation and impairment of tangible fixed assets
863,977
852,583
Pension scheme non-cash movement
320,000
309,000
Movements in working capital:
Increase in stocks
(4,309,904)
(1,819,426)
Increase in debtors
(106,225)
(1,502,161)
Increase in creditors
1,845,503
1,714,628
Cash absorbed by operations
(286,825)
(189,089)
2022-12-312022-01-01falseCCH SoftwareCCH Accounts Production 2023.300F M Brunnerfalse027780862022-01-012022-12-3102778086bus:Director12022-01-012022-12-3102778086bus:RegisteredOffice2022-01-012022-12-3102778086bus:Agent12022-01-012022-12-31027780862022-12-31027780862021-01-012021-12-3102778086core:RevaluationReserve2022-01-012022-12-3102778086core:RetainedEarningsAccumulatedLosses2022-01-012022-12-3102778086core:RetainedEarningsAccumulatedLosses2021-01-012021-12-3102778086core:RevaluationReserve2021-01-012021-12-3102778086core:RevenueReservesInvestmentFundsOnly2021-01-012021-12-31027780862021-12-3102778086core:LandBuildingscore:OwnedOrFreeholdAssets2022-12-3102778086core:LandBuildingscore:LeasedAssetsHeldAsLessee2022-12-3102778086core:PlantMachinery2022-12-3102778086core:FurnitureFittings2022-12-3102778086core:MotorVehicles2022-12-3102778086core:LandBuildingscore:OwnedOrFreeholdAssets2021-12-3102778086core:LandBuildingscore:LeasedAssetsHeldAsLessee2021-12-3102778086core:PlantMachinery2021-12-3102778086core:FurnitureFittings2021-12-3102778086core:MotorVehicles2021-12-3102778086core:CurrentFinancialInstrumentscore:WithinOneYear2022-12-3102778086core:CurrentFinancialInstrumentscore:WithinOneYear2021-12-3102778086core:CurrentFinancialInstruments2022-12-3102778086core:CurrentFinancialInstruments2021-12-3102778086core:ShareCapital2022-12-3102778086core:ShareCapital2021-12-3102778086core:RevaluationReserve2022-12-3102778086core:RevaluationReserve2021-12-3102778086core:RetainedEarningsAccumulatedLosses2022-12-3102778086core:RetainedEarningsAccumulatedLosses2021-12-3102778086core:ShareCapital2020-12-3102778086core:RevaluationReserve2020-12-3102778086core:RetainedEarningsAccumulatedLosses2020-12-31027780862020-12-3102778086core:RevaluationReserve2021-12-3102778086core:OtherReservesSubtotal2020-12-3102778086core:HedgingReserve2020-12-31027780862021-12-3102778086core:Goodwill2022-01-012022-12-3102778086core:LandBuildingscore:OwnedOrFreeholdAssets2022-01-012022-12-3102778086core:LandBuildingscore:LeasedAssetsHeldAsLessee2022-01-012022-12-3102778086core:PlantMachinery2022-01-012022-12-3102778086core:FurnitureFittings2022-01-012022-12-3102778086core:MotorVehicles2022-01-012022-12-3102778086bus:HighestPaidDirector2022-01-012022-12-3102778086core:UKTax2022-01-012022-12-3102778086core:UKTax2021-01-012021-12-3102778086core:ForeignTax2022-01-012022-12-3102778086core:ForeignTax2021-01-012021-12-310277808612022-01-012022-12-310277808612021-01-012021-12-310277808622022-01-012022-12-310277808622021-01-012021-12-310277808632022-01-012022-12-310277808632021-01-012021-12-310277808642022-01-012022-12-310277808642021-01-012021-12-3102778086core:Goodwill2021-12-3102778086core:Goodwill2022-12-3102778086core:Goodwill2021-12-3102778086core:LandBuildingscore:OwnedOrFreeholdAssets2021-12-3102778086core:LandBuildingscore:LeasedAssetsHeldAsLessee2021-12-3102778086core:PlantMachinery2021-12-3102778086core:FurnitureFittings2021-12-3102778086core:MotorVehicles2021-12-3102778086core:Non-currentFinancialInstruments2022-12-3102778086bus:PrivateLimitedCompanyLtd2022-01-012022-12-3102778086bus:FRS1022022-01-012022-12-3102778086bus:Audited2022-01-012022-12-3102778086bus:FullAccounts2022-01-012022-12-31xbrli:purexbrli:sharesiso4217:GBP