REGISTERED NUMBER: |
A H WORTH LIMITED |
STRATEGIC REPORT, |
REPORT OF THE DIRECTORS AND |
FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 MAY 2023 |
REGISTERED NUMBER: |
A H WORTH LIMITED |
STRATEGIC REPORT, |
REPORT OF THE DIRECTORS AND |
FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 MAY 2023 |
A H WORTH LIMITED (REGISTERED NUMBER: 02267537) |
CONTENTS OF THE FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 MAY 2023 |
Page |
Company Information | 1 |
Strategic Report | 2 | to | 4 |
Report of the Directors | 5 | to | 6 |
Report of the Independent Auditors | 7 | to | 9 |
Income Statement | 10 |
Other Comprehensive Income | 11 |
Statement of Financial Position | 12 |
Statement of Changes in Equity | 13 |
Notes to the Financial Statements | 14 | to | 23 |
A H WORTH LIMITED |
COMPANY INFORMATION |
FOR THE YEAR ENDED 31 MAY 2023 |
DIRECTORS: |
SECRETARY: |
REGISTERED OFFICE: |
REGISTERED NUMBER: |
AUDITORS: |
Enterprise Way |
Pinchbeck |
Spalding |
Lincolnshire |
PE11 3YR |
A H WORTH LIMITED (REGISTERED NUMBER: 02267537) |
STRATEGIC REPORT |
FOR THE YEAR ENDED 31 MAY 2023 |
The directors present their strategic report for the year ended 31 May 2023. |
REVIEW OF BUSINESS |
The majority of the Group's potato, fresh prepared and vegetable product sales continue to be to leading UK retailers and home delivery avenues and involve a broad range of product types and grower sources. Fresh and prepared potatoes continue to be the largest product area of the company. |
Extreme weather events (high temperatures and heavy rainfall) meant that our potato yields were down meaning more free buy purchasing at expensive prices. |
Significant cost inflation continues to be an ongoing major challenge to both the Company and the wider industry and this impacted the financial year with raw material input prices, labour cost and availability, energy price and transport costs all materially increasing, predominantly due to the uncertainty and supply side shortages created by the Ukraine crisis. |
Whilst there are some signs that this, and wider inflationary pressure are starting to ease slightly, we expect it to continue to have some impact on the next financial year. |
The Board continues to take proactive steps to mitigate and recover cost through efficiencies and continued investment in people and assets and as such is confident that the outlook for the business is positive for the next financial year. |
A H WORTH LIMITED (REGISTERED NUMBER: 02267537) |
STRATEGIC REPORT |
FOR THE YEAR ENDED 31 MAY 2023 |
PRINCIPAL RISKS AND UNCERTAINTIES |
The management of the business and the execution of the company's strategy are subject to a number of risks. Risks are formally reviewed by the board and appropriate processes put in place to monitor and mitigate them. |
The key risks affecting the company are set out below: |
Customers |
In order to reduce the potential loss of custom the company values integrity and seeks to conduct its business with professionalism and aspires to provide excellent service in the eyes of our customers. The business works to align itself to all its customers' objectives and be at the forefront of developing supply chain value. The company's strategy continues to be to develop the business across more sectors to ensure optimum crop utilisation and extend its range in growth produce categories. |
The company monitors the changes in ultimate consumer consumptions trends and consequently seeks to develop core businesses to cater for these. |
Employees |
The company respects and cares for its staff and invests in their employment potential in return for loyalty, openness, commitment and performance. The company operates a variety of progression based structures, invests in personal and professional development, provides significant work related benefits and employs an open and honest process of continuous dialogue to ensure employees' interests are aligned with the company. The company believes in remunerating its staff fairly for doing a good job which includes taking on responsibility, working as a team and supporting the company's continuous improvement. |
Commodity risk |
As a large part of the company's operations are involved with agricultural raw materials, it is exposed to the vagaries of climate and economic cycles and the company operates a variety of tools to reduce exposure to this risk. These include contracting supply price and quantity with suppliers, growing our own crops, having a wide customer spectrum to ensure optimum product utilisation and working with customers to increase real value. The challenges of raw material supply were exacerbated following the Ukraine crisis and this continues to contribute to commodity volatility. |
Brexit risk |
Brexit continues to have some impact on the business in a number of ways. The majority of raw materials are sourced in the UK but the business could be impacted by future trade agreements, exchange rates and agricultural support payments. The business will continue to manage its exposure to these risks by continuing to match customer contracts and the purchase of raw materials. In addition purchases in euros will be hedged at the time of transaction. |
A large proportion of our workforce is drawn from EU nationals, of which the majority are fully employed by the company. Others are engaged on a temporary basis through registered employment agencies. To date we have not seen any significant adverse trends in the availability of labour and policy will continue to support our workforce by rewarding fairly and providing a modern and desirable working environment. |
Natural resources |
A further key risk is the environment and the consumption of natural resources. The company respects the environment in which it operates and works to conserve natural resources and enhance the natural environment. The company and its subsidiaries are working on a range of initiatives to reduce the carbon footprint associated with its supply chains in active participation with customers and suppliers. These include the production of renewable energy from anaerobic digestion and solar panels and its membership of LEAF (Linking Environment & Farming). Furthermore, it recognises inflationary pressures arising from fossil fuel prices and commodity shortages and works closely with customers and suppliers to mitigate this through supply chain efficiencies. |
A H WORTH LIMITED (REGISTERED NUMBER: 02267537) |
STRATEGIC REPORT |
FOR THE YEAR ENDED 31 MAY 2023 |
SECTION 172(1) STATEMENT |
Stakeholder Engagement |
As the Board at A H Worth Limited, we have a legal responsibility under section 172 of the Companies Act 2006 to act in the way we consider, in good faith, would be most likely to promote the company's success for the benefit of its members as a whole, and to have regard to the long-term effect of our decisions on the company and its stakeholders. This statement addresses the ways in which we as a Board outwork this responsibility. |
Engaging with stakeholders |
Our key stakeholders, and the ways in which we engage with them, are as follows: |
Our employees |
Without the dedication and commitment from our employees, we know that we wouldn't be able to support our customers and suppliers in the way that we continue to do. This was highlighted further throughout the challenges of Covid and the Ukraine crisis. To strengthen this, we want to create an inspiring and motivating environment for our employees with cross-functional teams, clear goals and a culture that celebrates achievement. We believe that together, in the right atmosphere, we can continue to achieve more. |
Our customers and suppliers |
Working with our customers and suppliers in a respectful and enjoyable way is essential for our business to succeed. Therefore, we must stay committed to building relationships that last, by taking the time to understand the needs of our customers, suppliers and partners. |
Our community |
We pride ourselves in actively participating in all of our communities. It is a key value that we ensure that we have a wide range of local initiatives to help our communities thrive, grow and diversify, ranging from Open Farm Sundays where we welcome the public to our farms, to the various local projects that we support. |
Our planet |
We believe that long term outcomes are always better than short term impacts. Therefore, at A H Worth, we believe that sustainability should underpin everything that we do. From the way that we farm our land so that it's preserved for future generations, to the use of renewable energy sources, and in the reduction of waste, we strive to behave in a truly sustainable way. |
FINANCIAL KEY PERFORMANCE INDICATORS |
The key performance indicators of the business which are monitored through the production of periodic management accounts are as follows: |
2023 | 2022 |
Turnover | £79.7m | £74.6m |
Turnover movement year on year | 6.7% | (0.9%) |
Gross profit | £15m | £17.9m |
Gross profit - % of sales | 18.9% | 24.0% |
Operating profit/(loss) | (£6.8m) | (£1.6m) |
OTHER KEY PERFORMANCE INDICATORS |
The Management employ a range of customer and internally derived Key Performance Indicators often on a daily or even hourly basis to assist in the control and monitoring of business progress. These indicators include physical performance, financial, quality assurance, technical and customer service measures. Where possible they are produced from a range of bespoke and externally provided control systems. The company prides itself in actively seeking the feedback of its customers to assist in the continuous improvement of service and quality and this feedback along with formal financial and operating performance measures are reported comprehensively to the A H Worth and Company Limited Board on a monthly basis. |
ON BEHALF OF THE BOARD: |
A H WORTH LIMITED (REGISTERED NUMBER: 02267537) |
REPORT OF THE DIRECTORS |
FOR THE YEAR ENDED 31 MAY 2023 |
The directors present their report with the financial statements of the company for the year ended 31 May 2023. |
PRINCIPAL ACTIVITY |
The principal activity of the company in the year under review was that of growing, packing and selling of fresh and fresh prepared produce. |
DIVIDENDS |
No dividends will be distributed for the year ended 31 May 2023. |
DIRECTORS |
The directors shown below have held office during the whole of the period from 1 June 2022 to the date of this report. |
DISABLED EMPLOYEES |
The group will employ disabled persons when they appear to be suitable for a particular vacancy and every effort is made to ensure that they are given full and fair consideration when such vacancies arise. There is a training scheme in operation so that employees who have been injured or disabled in the course of their employment can, where possible, continue in employment with the group. The group operates a progressive system for career development and progression which is available to all employees. |
ENGAGEMENT WITH EMPLOYEES |
The company encourages the involvement of its employees in its management through regular meetings of the site consultative teams which have responsibility for the dissemination of information of particular concern to employees and for receiving their views on important matters of policy. The group also holds a series of formal briefings on group performance including quarterly company reviews to which all employees are invited |
STATEMENT OF DIRECTORS' RESPONSIBILITIES |
The directors are responsible for preparing the Strategic Report, the Report of the Directors and the financial statements in accordance with applicable law and regulations. |
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to: |
- | select suitable accounting policies and then apply them consistently; |
- | make judgements and accounting estimates that are reasonable and prudent; |
- | state whether applicable 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 directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. |
STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS |
So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and each director has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the company's auditors are aware of that information. |
A H WORTH LIMITED (REGISTERED NUMBER: 02267537) |
REPORT OF THE DIRECTORS |
FOR THE YEAR ENDED 31 MAY 2023 |
AUDITORS |
The auditors, Duncan & Toplis Audit Limited, Statutory Auditor, will be proposed for re-appointment at the forthcoming Annual General Meeting. |
ON BEHALF OF THE BOARD: |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
A H WORTH LIMITED |
Opinion |
We have audited the financial statements of A H Worth Limited (the 'company') for the year ended 31 May 2023 which comprise the Income Statement, Other Comprehensive Income, Statement of Financial Position, Statement of Changes in Equity and Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice). |
In our opinion the financial statements: |
- | give a true and fair view of the state of the company's affairs as at 31 May 2023 and of its loss 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. |
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 Auditors' 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 directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate. |
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue. |
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report. |
Other information |
The directors are responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon. |
Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. |
In connection with our audit of the financial statements, 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 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 the audit: |
- | the information given in the Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
- | the Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements. |
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 Report of the Directors. |
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion: |
- | adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or |
- | the financial statements are not in agreement with the accounting records and returns; or |
- | certain disclosures of directors' remuneration specified by law are not made; or |
- | we have not received all the information and explanations we require for our audit. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
A H WORTH LIMITED |
Responsibilities of directors |
As explained more fully in the Statement of Directors' Responsibilities set out on page five, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. |
In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so. |
Auditors' 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 a Report of the Auditors 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: |
We have identified areas of laws and regulations that could reasonably be expected to have a material effect on the financial statements from our general commercial experience, knowledge of the sector, a review of regulatory and legal correspondence and through discussions with Directors and other management obtained as part of the work required by auditing standards. We have also discussed with the Directors and other management the policies and procedures relating to compliance with laws and regulations. We communicated laws and regulations throughout the team and remained alert to any indications of non-compliance throughout the audit. |
The potential impact of different laws and regulations varies considerably. Firstly, the company is subject to laws and regulations that directly impact the financial statements (for example financial reporting legislation) and we have assessed the extent of compliance with such laws as part of our financial statements audit. |
Secondly, the company is subject to other laws and regulations where the consequence for non-compliance could have a material effect on the amounts or disclosures in the financial statements. We identified the following areas as those most likely to have such an effect: Health and Safety regulations, Food Safety regulations and Employment laws. |
Auditing standards limit the required audit procedures to identify non-compliance with these laws and regulations to enquiry of the Directors and other management and inspection. This inspection included a review of the external audits conducted in the year, confirmation of renewed relevant memberships and licenses and a detailed walkthrough of Health and Safety controls. Through these procedures, if we became aware of any non-compliance, we considered the impact on the procedures performed on the related financial statement items. |
Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. The further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it. As with any audit, there is a greater risk of non-detection of irregularities as these may involve collusion, intentional omissions of the override of internal controls. We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations. |
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
A H WORTH LIMITED |
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 a Report of the Auditors 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. |
for and on behalf of |
Enterprise Way |
Pinchbeck |
Spalding |
Lincolnshire |
PE11 3YR |
A H WORTH LIMITED (REGISTERED NUMBER: 02267537) |
INCOME STATEMENT |
FOR THE YEAR ENDED 31 MAY 2023 |
2023 | 2022 |
Notes | £ | £ | £ | £ |
TURNOVER |
Cost of sales |
GROSS PROFIT |
Distribution costs |
Administrative expenses |
21,784,157 | 19,600,407 |
(6,809,830 | ) | (1,730,550 | ) |
Other operating income |
OPERATING LOSS | 5 | ( |
) | ( |
) |
Profit/loss on sale of invest | 6 |
(6,926,111 | ) | (1,692,483 | ) |
Interest receivable and similar income | ( |
) |
(6,912,966 | ) | (1,696,657 | ) |
Interest payable and similar expenses | 7 |
LOSS BEFORE TAXATION | ( |
) | ( |
) |
Tax on loss | 8 | ( |
) |
LOSS FOR THE FINANCIAL YEAR | ( |
) | ( |
) |
A H WORTH LIMITED (REGISTERED NUMBER: 02267537) |
OTHER COMPREHENSIVE INCOME |
FOR THE YEAR ENDED 31 MAY 2023 |
2023 | 2022 |
Notes | £ | £ |
LOSS FOR THE YEAR | ( |
) | ( |
) |
OTHER COMPREHENSIVE INCOME | - | - |
TOTAL COMPREHENSIVE INCOME FOR THE YEAR | ( |
) | ( |
) |
A H WORTH LIMITED (REGISTERED NUMBER: 02267537) |
STATEMENT OF FINANCIAL POSITION |
31 MAY 2023 |
2023 | 2022 |
Notes | £ | £ | £ | £ |
FIXED ASSETS |
Intangible assets | 9 |
Tangible assets | 10 |
Investments | 11 |
CURRENT ASSETS |
Stocks | 12 |
Debtors | 13 |
Cash at bank and in hand |
CREDITORS |
Amounts falling due within one year | 14 |
NET CURRENT (LIABILITIES)/ASSETS | ( |
) |
TOTAL ASSETS LESS CURRENT LIABILITIES | ( |
) |
CREDITORS |
Amounts falling due after more than one year | 15 | ( |
) | ( |
) |
PROVISIONS FOR LIABILITIES | 18 | ( |
) |
NET (LIABILITIES)/ASSETS | ( |
) |
CAPITAL AND RESERVES |
Called up share capital | 19 |
Capital redemption reserve | 20 |
Retained earnings | 20 | ( |
) |
SHAREHOLDERS' FUNDS | ( |
) |
The financial statements were approved by the Board of Directors and authorised for issue on |
A H WORTH LIMITED (REGISTERED NUMBER: 02267537) |
STATEMENT OF CHANGES IN EQUITY |
FOR THE YEAR ENDED 31 MAY 2023 |
Called up | Capital |
share | Retained | redemption | Total |
capital | earnings | reserve | equity |
£ | £ | £ | £ |
Balance at 1 June 2021 |
Changes in equity |
Total comprehensive income | - | ( |
) | ( |
) |
Balance at 31 May 2022 | 1,776,457 | 3,288,814 | 5,083,558 |
Changes in equity |
Total comprehensive income | - | ( |
) | ( |
) |
Balance at 31 May 2023 | ( |
) | ( |
) |
A H WORTH LIMITED (REGISTERED NUMBER: 02267537) |
NOTES TO THE FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 MAY 2023 |
1. | STATUTORY INFORMATION |
A H Worth Limited is a |
2. | ACCOUNTING POLICIES |
Basis of preparing the financial statements |
Financial Reporting Standard 102 - reduced disclosure exemptions |
The company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland": |
• | the requirements of Section 7 Statement of Cash Flows; |
• | the requirement of paragraph 3.17(d); |
• | the requirements of paragraphs 11.42, 11.44, 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b) and 11.48(c); |
• | the requirements of paragraphs 12.26, 12.27, 12.29(a), 12.29(b) and 12.29A; |
• | the requirement of paragraph 33.7. |
Revenue |
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the company and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised: |
Sale of goods |
Revenue from the sale of goods is recognised when all of the following conditions are satisfied: |
- the company has transferred the significant risks and rewards of ownership to the buyer; |
- the company retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold; |
- the amount of revenue can be measured reliably; |
- it is probable that the company will receive the consideration due under the transaction; and |
- the costs incurred or to be incurred in respect of the transaction can be measured reliably. |
Goodwill |
Goodwill represents the difference between amounts paid on the cost of a business combination and the acquirer's interest in the fair value of the company's share of its identifiable assets and liabilities of the acquiree at the date of acquisition. Subsequent to initial recognition, goodwill is measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is amortised on a straight line basis to the Statement of Total Comprehensive Income over its useful economic life. |
Intangible assets |
Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses. |
All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years. |
A H WORTH LIMITED (REGISTERED NUMBER: 02267537) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MAY 2023 |
2. | ACCOUNTING POLICIES - continued |
Tangible fixed assets |
Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management. |
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line or reducing balance method. |
Depreciation is provided on the following basis: |
Long-term leasehold property - 5 - 10 years |
Short-term leasehold property - 3 - 5 years |
Plant and machinery - 3 - 20 years or 15%-20% reducing balance |
Motor vehicles - 3 - 5 years or 25% reducing balance |
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date. |
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in the statement of total comprehensive income. |
Investments in subsidiaries and associates |
Investments in subsidiaries are measured at cost less accumulated impairment. |
Stocks |
Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis. Work in progress and finished goods include labour and attributable overheads. |
At each balance sheet date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in profit or loss. |
Stocks are valued in accordance with guidance notes on agricultural stock calculations for tax purposes and are stated at the lower of cost and net realisable value. Cost includes materials, direct labour and production overheads appropriate to the relevant stage of production. Net realisable value is based on estimated selling price less all further costs to completion and all relevant marketing, selling and distribution costs. |
Current and deferred taxation |
The tax expense for the year comprises current and deferred tax. Tax is recognised in the statement of total comprehensive income, except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively. |
The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the balance sheet date in the countries where the company operate and generate income. |
Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the balance sheet date, except that: |
- The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; |
- Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met; and |
- Where they relate to timing differences in respect of interests in subsidiaries, associates, branches and joint ventures and the company can control the reversal of the timing differences and such reversal is not considered probable in the foreseeable future. |
Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the balance sheet date. |
A H WORTH LIMITED (REGISTERED NUMBER: 02267537) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MAY 2023 |
2. | ACCOUNTING POLICIES - continued |
Research and development |
In the research phase of an internal project it is not possible to demonstrate that the project will generate future economic benefits and hence all expenditure on research shall be recognised as an expense when it is incurred. Intangible assets are recognised from the development phase of a project if and only if certain specific criteria are met in order to demonstrate the asset will generate probable future economic benefits and that its cost can be reliably measured. The capitalised development costs are subsequently amortised on a straight line basis over their useful economic lives, which range from 3 to 6 years. |
If it is not possible to distinguish between the research phase and the development phase of an internal project, the expenditure is treated as if it were all incurred in the research phase only. |
Foreign currencies |
Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions. |
At each period end foreign currency monetary items are translated using the closing rate. Non- monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined. |
Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the statement of total comprehensive income except when deferred in other comprehensive income as qualifying cash flow hedges. |
Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the statement of total comprehensive income within 'finance income or costs'. All other foreign exchange gains and losses are presented in the statement of total comprehensive income within 'other operating income'. |
Hire purchase and leasing commitments |
Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the lease. |
Pensions |
Defined contribution pension plan |
The company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the company pays fixed contributions into a separate entity. Once the contributions have been paid the company has no further payment obligations. |
The contributions are recognised as an expense in the Statement of Total Comprehensive Income when they fall due. Amounts not paid are shown in accruals as a liability in the balance sheet. The assets of the plan are held separately from the company in independently administered funds. |
A H WORTH LIMITED (REGISTERED NUMBER: 02267537) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MAY 2023 |
2. | ACCOUNTING POLICIES - continued |
Financial instruments |
The company only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in ordinary shares. |
Debt instruments (other than those wholly repayable or receivable within one year), including loans and other accounts receivable and payable, are initially measured at present value of the future cash flows and subsequently at amortised cost using the effective interest method. Debt instruments that are payable or receivable within one year, typically trade debtors and creditors, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received. However, if the arrangements of a short-term instrument constitute a financing transaction, like the payment of a trade debt deferred beyond normal business terms or in case of an out-right short-term loan that is not at market rate, the financial asset or liability is measured, initially at the present value of future cash flows discounted at a market rate of interest for a similar debt instrument and subsequently at amortised cost, unless it qualifies as a loan from a director in the case of a small company, or a public benefit entity concessionary loan. |
Financial assets and liabilities are offset and the net amount reported in the Balance Sheet when there is an 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. |
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 income as appropriate. The company does not currently apply hedge accounting for interest rate and foreign exchange derivatives. |
Going concern |
After making enquiries, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Therefore, they continue to adopt the going concern basis of accounting in preparing the financial statements. |
3. | CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY |
The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported for assets and liabilities as at the balance sheet date and the amounts reported for revenues and expenses during the year. However, the nature of estimation means that actual outcomes could differ from those estimates. The following judgements have had the most significant effect on amounts recognise in the financial statements: |
Impairment of non-financial assets |
Where there are indicators of impairment of individual assets, the company performs impairment tests based on fair value less costs to sell or a value in use calculation. The fair value less costs to sell calculation is based on available data from binding sales transactions in an arms' length transaction on similar assets or observable market prices less incremental costs for disposing of the asset. The value in use calculation is based on a discounted cash flow model, The cash flows are derived from the budget for the relevant period and do not include restructuring activities that the company is not yet committed to or significant future investments that will enhance the asset's performance of the cash generating unit being tested. The recoverable amount is most sensitive to the discount rate used for the discounted cash flow model as well as the expected future cash flows and the growth rate used. |
Goodwill and intangible assets |
The company establishes a reliable estimate of the useful life of goodwill and intangible assets arising on business combinations. This estimate is based on a variety of factors such as the expected use of the acquired business, the expected usual life of the cash generating units to which the goodwill is attributed and any contractual provisions that can limit useful life. |
Taxation |
Management estimation is required to determine the amount of deferred tax assets that can be recognised, based upon likely timing and level of future taxable profits together with an assessment of the effect of future tax planning strategies. |
A H WORTH LIMITED (REGISTERED NUMBER: 02267537) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MAY 2023 |
4. | EMPLOYEES AND DIRECTORS |
2023 | 2022 |
£ | £ |
Wages and salaries |
Social security costs |
Other pension costs |
The average number of employees during the year was as follows: |
2023 | 2022 |
Administration | 93 | 94 |
Production | 211 | 251 |
2023 | 2022 |
£ | £ |
Directors' remuneration |
5. | OPERATING LOSS |
The operating loss is stated after charging/(crediting): |
2023 | 2022 |
£ | £ |
Hire of plant and machinery |
Depreciation - owned assets |
Profit on disposal of fixed assets | ( |
) |
Auditors' remuneration |
Foreign exchange differences | ( |
) |
6. | EXCEPTIONAL ITEMS |
2023 | 2022 |
£ | £ |
Exceptional items | (211,927 | ) | - |
Profit/loss on sale of invest | ( |
) |
(328,208 | ) | - |
Exceptional items relate to costs incurred as part of restructuring. |
7. | INTEREST PAYABLE AND SIMILAR EXPENSES |
2023 | 2022 |
£ | £ |
Bank interest |
A H WORTH LIMITED (REGISTERED NUMBER: 02267537) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MAY 2023 |
8. | TAXATION |
Analysis of the tax (credit)/charge |
The tax (credit)/charge on the loss for the year was as follows: |
2023 | 2022 |
£ | £ |
Deferred tax | ( |
) |
Tax on loss | ( |
) |
UK corporation tax has been charged at 25% . |
Reconciliation of total tax (credit)/charge included in profit and loss |
The tax assessed for the year is higher than the standard rate of corporation tax in the UK. The difference is explained below: |
2023 | 2022 |
£ | £ |
Loss before tax | ( |
) | ( |
) |
Loss multiplied by the standard rate of corporation tax in the UK of |
( |
) |
( |
) |
Effects of: |
Expenses not deductible for tax purposes |
Income not taxable for tax purposes | ( |
) | ( |
) |
Capital allowances in excess of depreciation | - | ( |
) |
Depreciation in excess of capital allowances | - |
Deferred tax | (417,787 | ) | 69,542 |
Change in tax rate | - | 100,269 |
Losses surrendered to group companies | 1,150,131 | 409,015 |
Total tax (credit)/charge | (417,787 | ) | 169,811 |
9. | INTANGIBLE FIXED ASSETS |
Computer |
Goodwill | software | Totals |
£ | £ | £ |
COST |
At 1 June 2022 |
and 31 May 2023 |
AMORTISATION |
At 1 June 2022 |
and 31 May 2023 |
NET BOOK VALUE |
At 31 May 2023 |
At 31 May 2022 |
A H WORTH LIMITED (REGISTERED NUMBER: 02267537) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MAY 2023 |
10. | TANGIBLE FIXED ASSETS |
Fixtures |
Freehold | Plant and | and |
property | machinery | fittings |
£ | £ | £ |
COST |
At 1 June 2022 |
Additions |
At 31 May 2023 |
DEPRECIATION |
At 1 June 2022 |
Charge for year |
At 31 May 2023 |
NET BOOK VALUE |
At 31 May 2023 |
At 31 May 2022 |
Motor | Computer |
vehicles | equipment | Totals |
£ | £ | £ |
COST |
At 1 June 2022 |
Additions |
At 31 May 2023 |
DEPRECIATION |
At 1 June 2022 |
Charge for year |
At 31 May 2023 |
NET BOOK VALUE |
At 31 May 2023 |
At 31 May 2022 |
11. | FIXED ASSET INVESTMENTS |
Shares in |
Shares in | associated |
subsidiary | undertakings | Totals |
£ | £ | £ |
COST |
At 1 June 2022 | 149,281 | 425,220 |
Disposals | ( |
) | (149,281 | ) |
At 31 May 2023 | 275,939 |
NET BOOK VALUE |
At 31 May 2023 | 275,939 |
At 31 May 2022 | 425,220 |
A H WORTH LIMITED (REGISTERED NUMBER: 02267537) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MAY 2023 |
12. | STOCKS |
2023 | 2022 |
£ | £ |
Stocks |
13. | DEBTORS |
2023 | 2022 |
£ | £ |
Amounts falling due within one year: |
Trade debtors |
Other debtors |
Prepayments and accrued income |
Amounts falling due after more than one year: |
Amounts owed by participating interests | 823,848 | 1,066,328 |
Aggregate amounts |
14. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2023 | 2022 |
£ | £ |
Hire purchase contracts (see note 16) |
Trade creditors |
Amounts owed to group undertakings |
Amounts owed to participating interests | 88,309 | 35,719 |
Taxation |
Other taxes and social security |
Other creditors |
Accruals and deferred income |
15. | CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR |
2023 | 2022 |
£ | £ |
Hire purchase contracts (see note 16) |
Amounts owed to group undertakings |
16. | LEASING AGREEMENTS |
Minimum lease payments fall due as follows: |
Hire purchase contracts |
2023 | 2022 |
£ | £ |
Net obligations repayable: |
Within one year |
Between one and five years |
A H WORTH LIMITED (REGISTERED NUMBER: 02267537) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MAY 2023 |
16. | LEASING AGREEMENTS - continued |
Non-cancellable operating | leases |
2023 | 2022 |
£ | £ |
Within one year |
Between one and five years |
17. | SECURED DEBTS |
Finance leases and hire purchase liabilities are secured against the assets to which they relate. Obligations under finance lease and hire purchase contracts are fixed at 1.75% to 2.85% and are repayable over a 5 year term. |
The bank loans and overdrafts are secured; HSBC Plc has a debenture over all monies and liabilities whenever and however incurred by the Company; whether now or in the future. |
18. | PROVISIONS FOR LIABILITIES |
2023 | 2022 |
£ | £ |
Deferred tax |
Accelerated capital allowances | - | 417,787 |
Deferred |
tax |
£ |
Balance at 1 June 2022 |
Credit to Income Statement during year | ( |
) |
Release of provision |
Balance at 31 May 2023 |
19. | CALLED UP SHARE CAPITAL |
Allotted, issued and fully paid: |
Number: | Class: | Nominal | 2023 | 2022 |
value: | £ | £ |
Ordinary shares | £1 | 1,776,457 | 1,776,457 |
20. | RESERVES |
Capital |
Retained | redemption |
earnings | reserve | Totals |
£ | £ | £ |
At 1 June 2022 | 3,307,101 |
Deficit for the year | ( |
) | - | ( |
) |
At 31 May 2023 | ( |
) | (3,303,814 | ) |
21. | ULTIMATE PARENT COMPANY |
The ultimate parent company and controlling party is A H Worth and Company Limited, Fleet Estate Office, Manor Farm, Holbeach Hurn, Lincolnshire, PE12 8LR, a company registered in England and Wales. Consolidated financial statements are prepared by the ultimate parent company and can be obtained from the registered office. |
A H WORTH LIMITED (REGISTERED NUMBER: 02267537) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MAY 2023 |
22. | PENSION COMMITMENTS |
The company operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the group in an independently administered fund. The pension cost charge represents contributions payable by the company to the fund and amounted to £289,426 (2022 - £377,848). Contributions totalling £38,591 (2022 - £34,920) were payable to the fund at the balance sheet date. |
23. | RELATED PARTY DISCLOSURES |
D R Worth is a director of Holbeach Marsh Co-operative Limited. During the year the company made sales to Holbeach Marsh Co-operative Limited of £nil (2022 - £8,658) and purchases from Holbeach Marsh Co-operative Limited of £nil (2022 - £nil). At the year end the company was owed £nil (2022 - £476) by Holbeach Marsh Co-operative Limited. The company owed £nil (2022 - £nil) to Holbeach Marsh Co-operative Limited. |
D R Worth is a director of Holbeach Biogas Limited. During the year the company made sales to Holbeach Biogas Limited of £117,546 (2022 - £48,525). At the year end the company was owed £12,088 (2022 - £nil) by Holbeach Biogas Limited. |
During the year the company sold goods and services to Manor Fresh Limited, a joint venture of the parent company, amounting to £253,434 (2022 - £240,622) and purchased goods amounting to £965,288 (2022 - £1,001,415). All these sales and purchases were on a normal commercial basis. At the year end the company was owed £nil (2022 - £21,674) by Manor Fresh Limited. The company owed £88,309 (2022 - £149,827) to Manor Fresh Limited. |
SLW Property Services Limited is owned and controlled by the wife of D R Worth (a director of the company). During the year the company made purchases of £10,173 (2022 - £10,683) for administration and accounting services from SLW Property Services Limited. At the year end the company owed £nil (2022 - £950) to SLW Property Services Limited. |
The company made purchases of £27,862 (2022 - £83,450) from Anglia Growing Partnership, a joint venture of the parent company. The company owed £nil (2022 - £5,499) to Anglia Growing Partnership at the year end. At the year end, the loan outstanding to Anglia Growing Partnership Limited totalled £823,848 (2022 - £1,048,848). |
24. | RESERVES |
Called up share capital represents the nominal value of shares that have been issued. |
The capital redemption reserve represents amounts transferred following the redemption of the company's own shares. |
The profit and loss account includes all current and prior period retained profits and losses. |
25. | SUBSIDIARY UNDERTAKINGS |
The following were subsidiary undertakings of the company: |
Name | Principal activity | Class of shares | Holding |
QV Foods Limited formerly QV Limited | Dormant | Ordinary | 100% |
Europa Produce Limited | Dormant | Ordinary | 100% |
Fresh Approach Limited | Dormant | Ordinary | 100% |
Pseedco | Dormant | Ordinary | 100% |
Greyfriars (UK) Limited | Dormant | Ordinary | 100% |
JOINT VENTURE |
The following were joint venture of the company: |
Name |
Principal activity |
Class of shares |
Holding |
Anglia Growing Partnership Limited |
Sale of fresh produce |
Ordinary |
50% |
Worth Growers Limited | Dormant | Ordinary | 50% |