Company registration number 07632944 (England and Wales)
H G WALTER LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2023
H G WALTER LIMITED
COMPANY INFORMATION
Directors
P Heanen
A Heanen
C Heanen
D Heanen
L Heanen
Company number
07632944
Registered office
Unit 737 Tudor Estate Abbey Road
Park Royal
London
NW10 7UN
Auditor
Glazers
843 Finchley Road
London
NW11 8NA
H G WALTER LIMITED
CONTENTS
Page
Strategic report
1 - 3
Directors' report
4 - 5
Independent auditor's report
6 - 9
Statement of comprehensive income
10
Balance sheet
11
Statement of changes in equity
12
Statement of cash flows
13
Notes to the financial statements
14 - 27
H G WALTER LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 30 SEPTEMBER 2023
- 1 -

The directors present the strategic report for the year ended 30 September 2023.

Review of the business

The profit and loss account on page 10 of the financial statements provides a summary of the company's trading results for the year. The performance and results for the year are in line with the directors' expectations.

During the year the business enjoyed further growth with turnover increasing by 23%% from £34.9m to £42.9m. This growth was driven by an increasing share of the wholesale market and a wider product range. The additional activity provides a good return on the investment in the warehouse premises.

The wholesale sector of the business remains strong having achieved increasing profits whilst operating within a turbulent market. The directors remain focused on continuing to strengthen this area of the business as well as developing their online presence and achieving continued growth in both revenue and profits.

The company's balance sheet remains strong with net current assets of £6.3m and shareholders' funds of £7.75m. Profitability has enabled the company to make significant investment in the warehousing operations to strengthen the logistics and opportunities for a wider customer base.

 

The directors continue to review the business and industry to minimise or mitigate the risks that are prevalent in a commercial environment. The company continues to develop its product range.

H G WALTER LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023
- 2 -
Principal risks and uncertainties

The principal risk to the company is that of supply chain disruption. This risk is further increased on the basis that the company operates within a highly competitive marketplace. The company mitigates this risk, in part, through a diverse supply chain base and does not rely on any one single supplier. There are, however, factors that are more difficult to mitigate and plan for, including political, weather and regulatory challenges.

Product safety and quality is also a key risk to the company. The directors are confident that both the wholesale and retail premises are well placed to mitigate this risk as the company have stringent procedures in place to ensure the highest standards in food safety and quality. These procedures are regularly reviewed, and the company have a compliance led approach to any issues that would impact potential safety concerns.

The risk of commodity prices on the cost of goods sold is mitigated by careful stock management.

 

The financial instruments used by the company arise wholly and directly from its activities. The main financial instruments comprise debtors, cash at bank and trade creditors. The financial risks arising from these financial instruments are considered low. The mature financial stability of the business ensures the company maintains excellent terms with preferred suppliers and their credit partners.

Cash reserves have remained healthy over the year and the company continues to trade with the support of bank loans. Working capital will continue to be monitored on a regular basis by the directors.

The directors have not delegated the responsibility of monitoring financial risk management and the company's finance department implements the policies set by the company's directors. The department has specific guidelines agreed by the directors to manage credit risk.

Credit risk

The company has implemented policies that require appropriate credit checks on potential customers before new accounts are accepted. Furthermore, credit limits are set in place and reviewed on a quarterly basis.

Liquidity and cash flow risk

The directors consider the company to have sufficient available funds for operations. The directors are presented with cashflow reporting on a monthly basis when future plans, opportunities and risk are discussed.

 

Price risk

Expenditure made by the company is authorised prior to it being made by management in order to ensure that goods and services are not obtained at a higher price than necessary.

 

Key performance indicators

The key performance indicators used by the company include gross profit margin, which increased from 36% to 37.9% and turnover which increased from £34.9m to £42.9m. The results for the year were in line with targets and expectations.

The non financial key performance indicators include ensuring that product and service quality are of a reasonable value whilst constantly striving to improve quality control measures. The company also identifies customer care services as being significant.

 

The directors are mindful of environmental issues and have sought to minimise the impact of the company's activities on the environment.

In addition, other non financial key performance indicators include raising brand awareness and the company profile measured by both customer and supplier loyalties and other attributes such as patents and trademarks. Key performance indicators are maintained across all parts of the business to ensure we are constantly monitoring and challenging our results.

H G WALTER LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023
- 3 -
Other information and explanations

Future developments

The company continues its commitment to supplying a range of products to a widening market of customers who require wholesale products at a competitive price. The company is continually enhancing its logistics network and production facilities and forecasts further growth from supply to major retailers, as well as expanding its online presence. The traditional customer base of hospitality and retail remain at the heart of the business strategy and the company aims to continue delivering high quality service to all its customers.

On behalf of the board

P Heanen
Director
1 March 2024
H G WALTER LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 SEPTEMBER 2023
- 4 -

The directors present their annual report and financial statements for the year ended 30 September 2023.

Principal activities

The principal activity of the company continued to be that of sale of meat and meat products.

Results and dividends

The results for the year are set out on page 10.

Ordinary dividends were paid amounting to £1,365,762. The directors do not recommend payment of a further dividend.

Directors

The directors who held office during the year and up to the date of signature of the financial statements were as follows:

P Heanen
A Heanen
C Heanen
D Heanen
L Heanen
Energy and carbon report

As the company has not consumed more than 40,000 kWh of energy in this reporting period, it qualifies as a low energy user under these regulations and is not required to report on its emissions, energy consumption or energy efficiency activities.

Statement of directors' responsibilities

The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.

 

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

 

 

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.

Strategic report

The company has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the company's strategic report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the directors' report.

H G WALTER LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023
- 5 -
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
P Heanen
Director
1 March 2024
H G WALTER LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF H G WALTER LIMITED
- 6 -
Opinion

We have audited the financial statements of H G Walter Limited (the 'company') for the year ended 30 September 2023 which comprise 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:

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the 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 other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are 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:

H G WALTER LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF H G WALTER LIMITED
- 7 -
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 directors' report.

 

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

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

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

The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

H G WALTER LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF H G WALTER LIMITED
- 8 -

In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, we considered the following:

 

1) Enquiries of management concerning the company's policies and procedures relating to:

 

2) Discussions among the engagement team regarding how and when fraud might occur in the financial statements and any potential indicators of fraud.

 

In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override.

 

We also obtained an understanding of the legal and regulatory framework that the company operates in, focusing on provisions of those laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements. The key laws and regulations we considered in this context included the UK Companies Act and United Kingdom Generally Accepted Accounting Practice.

 

In addition, we considered provisions of other laws and regulations that do not have a direct effect on the financial statements but compliance with which may be fundamental to the company's ability to operate or avoid a material penalty.

 

As a result of performing the above, we did not identify any key audit matters related to the potential risk of fraud or non-compliance with laws and regulations.

 

In addition to the above, our procedures to respond to risks identified included the following:

 

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

 

We note that our audit is not primarily designed to detect non-compliance with laws and regulations and the directors and other management are responsible for such internal control as the directors and other management of the company determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to errors or fraud, including compliance with laws and regulations. Additionally, 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. 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 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.

H G WALTER LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF H G WALTER LIMITED
- 9 -

Use of our report

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.

Paraskumar Shah FCA
Senior Statutory Auditor
For and on behalf of Glazers
1 March 2024
Chartered Accountants
Statutory Auditor
843 Finchley Road
London
NW11 8NA
H G WALTER LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 SEPTEMBER 2023
- 10 -
2023
2022
Notes
£
£
Turnover
3
42,859,765
34,903,533
Cost of sales
(26,602,827)
(22,329,489)
Gross profit
16,256,938
12,574,044
Administrative expenses
(11,113,054)
(8,959,973)
Operating profit
4
5,143,884
3,614,071
Interest payable and similar expenses
7
(37,961)
(26,334)
Profit before taxation
5,105,923
3,587,737
Tax on profit
8
(1,178,251)
(696,651)
Profit for the financial year
3,927,672
2,891,086

The profit and loss account has been prepared on the basis that all operations are continuing operations.

H G WALTER LIMITED
BALANCE SHEET
AS AT
30 SEPTEMBER 2023
30 September 2023
- 11 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
11
2,439,780
2,262,704
Current assets
Stocks
13
773,213
616,369
Debtors
14
4,515,462
4,221,816
Cash at bank and in hand
6,065,875
3,465,823
11,354,550
8,304,008
Creditors: amounts falling due within one year
15
(4,986,635)
(4,314,614)
Net current assets
6,367,915
3,989,394
Total assets less current liabilities
8,807,695
6,252,098
Creditors: amounts falling due after more than one year
16
(679,520)
(683,679)
Provisions for liabilities
Deferred tax liability
19
382,647
384,801
(382,647)
(384,801)
Net assets
7,745,528
5,183,618
Capital and reserves
Called up share capital
21
1
1
Profit and loss reserves
7,745,527
5,183,617
Total equity
7,745,528
5,183,618
The financial statements were approved by the board of directors and authorised for issue on 1 March 2024 and are signed on its behalf by:
P Heanen
Director
Company registration number 07632944 (England and Wales)
H G WALTER LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 SEPTEMBER 2023
- 12 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 October 2021
1
3,411,539
3,411,540
Year ended 30 September 2022:
Profit and total comprehensive income
-
2,891,086
2,891,086
Dividends
9
-
(1,119,008)
(1,119,008)
Balance at 30 September 2022
1
5,183,617
5,183,618
Year ended 30 September 2023:
Profit and total comprehensive income
-
3,927,672
3,927,672
Dividends
9
-
(1,365,762)
(1,365,762)
Balance at 30 September 2023
1
7,745,527
7,745,528
H G WALTER LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 SEPTEMBER 2023
- 13 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
25
5,293,959
3,181,939
Interest paid
(37,961)
(26,334)
Income taxes paid
(709,930)
(305,757)
Net cash inflow from operating activities
4,546,068
2,849,848
Investing activities
Purchase of tangible fixed assets
(578,771)
(224,420)
Net cash used in investing activities
(578,771)
(224,420)
Financing activities
Repayment of bank loans
(48,879)
(141,710)
Payment of finance leases obligations
47,959
-
0
Dividends paid
(1,365,762)
(1,119,008)
Net cash used in financing activities
(1,366,682)
(1,260,718)
Net increase in cash and cash equivalents
2,600,615
1,364,710
Cash and cash equivalents at beginning of year
3,465,260
2,100,550
Cash and cash equivalents at end of year
6,065,875
3,465,260
Relating to:
Cash at bank and in hand
6,065,875
3,465,823
Bank overdrafts included in creditors payable within one year
-
0
(563)
H G WALTER LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2023
- 14 -
1
Accounting policies
Company information

H G Walter Limited is an independent family-run butchers supplying some of the best restaurants in London. The company has a warehouse plant and shop in the UK and sells within the UK.

 

H G Walter Limited is a private company limited by shares incorporated in England and Wales. The registered office is Unit 737 Tudor Estate Abbey Road, Park Royal, London, NW10 7UN.

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 under the historical cost convention. 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 and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.

 

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

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

1.4
Intangible fixed assets - goodwill

Goodwill represents the excess of the cost of acquisition of unincorporated businesses over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is 10 years.

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.

H G WALTER LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023
1
Accounting policies
(Continued)
- 15 -

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:

Leasehold improvements
14 years straight line
Plant and equipment
15% reducing balance
Fixtures and fittings
15% reducing balance
Computers
33% straight line
Motor vehicles
25% reducing balance

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.

1.6
Impairment of fixed assets

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

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

 

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

1.7
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.

1.8
Cash and cash equivalents

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

H G WALTER LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023
1
Accounting policies
(Continued)
- 16 -
1.9
Financial instruments

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

 

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

 

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

Basic financial assets

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

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.

Impairment of financial assets

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

 

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

 

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

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.

H G WALTER LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023
1
Accounting policies
(Continued)
- 17 -
Basic financial liabilities

Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

 

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

 

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

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, unless hedge accounting is applied and the hedge is a cash flow hedge.

 

Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

Derecognition of financial liabilities

Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.

1.10
Equity instruments

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

1.11
Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

Current tax

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

H G WALTER LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023
1
Accounting policies
(Continued)
- 18 -
Deferred tax

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

 

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

1.12
Employee benefits

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

 

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

 

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

1.13
Retirement benefits

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

1.14
Leases

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.

 

Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.

1.15
Foreign exchange

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

H G WALTER LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023
- 19 -
2
Judgements and key sources of estimation uncertainty

In the application of the company’s accounting policies, the directors are 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.

Key accounting estimates and assumptions

Determining residual values and useful economic lives of property, plant and equipment and intangible fixed assets

The company depreciates tangible assets and amortises intangible assets over their estimated useful lives. The estimation of the useful lives of assets is based on historic performance, as well as expectations about future use, and therefore requires estimates and assumptions to be applied by management. The actual lives of these assets can vary depending on a variety of factors, including product life cycles and maintenance programmes.

 

Judgement is applied by management when determining the residual values for tangible and intangible fixed assets. When determining the residual value, management aim to assess the amount that the company would currently obtain for the disposal of the assets, if it were already of the condition expected at the end of its useful economic life.

Recoverability of receivables

The company establishes a provision for receivables that are estimated not to be recoverable. When assessing recoverability the directors consider factors such as the ageing of the receivables, past experience of recoverability and the credit profile of the debtor.

3
Turnover
2023
2022
£
£
Turnover analysed by class of business
Wholesale
37,201,108
29,188,167
Retail
1,582,002
1,448,764
Online
4,076,655
4,266,602
42,859,765
34,903,533
2023
2022
£
£
Turnover analysed by geographical market
United Kingdom
42,859,765
34,903,533
H G WALTER LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023
- 20 -
4
Operating profit
2023
2022
Operating profit for the year is stated after charging/(crediting):
£
£
Exchange losses/(gains)
15,942
(11,181)
Fees payable to the company's auditor for the audit of the company's financial statements
18,000
24,500
Depreciation of owned tangible fixed assets
401,695
334,778
Operating lease charges
707,639
668,337
5
Employees

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

2023
2022
Number
Number
Management
8
9
Adminstration
24
21
Production
119
99
Retail
10
9
Total
161
138

Their aggregate remuneration comprised:

2023
2022
£
£
Wages and salaries
6,633,993
4,912,922
Social security costs
713,951
520,949
Pension costs
106,290
287,022
7,454,234
5,720,893
6
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
1,000,637
312,522
Company pension contributions to defined contribution schemes
5,283
203,026
1,005,920
515,548

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 5 (2022 - 5).

H G WALTER LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023
6
Directors' remuneration
(Continued)
- 21 -
Remuneration disclosed above include the following amounts paid to the highest paid director:
2023
2022
£
£
Remuneration for qualifying services
262,544
81,502
Company pension contributions to defined contribution schemes
1,321
40,756
7
Interest payable and similar expenses
2023
2022
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
13,447
26,334
Other finance costs:
Other interest
24,514
-
0
37,961
26,334
8
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
1,170,591
700,116
Adjustments in respect of prior periods
9,814
-
0
Total current tax
1,180,405
700,116
Deferred tax
Origination and reversal of timing differences
(2,154)
(3,465)
Total tax charge
1,178,251
696,651
H G WALTER LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023
8
Taxation
(Continued)
- 22 -

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:

2023
2022
£
£
Profit before taxation
5,105,923
3,587,737
Expected tax charge based on the standard rate of corporation tax in the UK of 22.00% (2022: 19.00%)
1,123,303
681,670
Tax effect of expenses that are not deductible in determining taxable profit
31,351
90,609
Adjustments in respect of prior years
9,814
-
0
Permanent capital allowances in excess of depreciation
15,937
(78,162)
Other non-reversing timing differences
(2,154)
(3,465)
Other permanent differences
-
0
5,999
Taxation charge for the year
1,178,251
696,651
9
Dividends
2023
2022
£
£
Final paid
1,365,762
1,119,008
10
Intangible fixed assets
Goodwill
£
Cost
At 1 October 2022 and 30 September 2023
730,000
Amortisation and impairment
At 1 October 2022 and 30 September 2023
730,000
Carrying amount
At 30 September 2023
-
0
At 30 September 2022
-
0
H G WALTER LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023
- 23 -
11
Tangible fixed assets
Leasehold improvements
Plant and equipment
Fixtures and fittings
Computers
Motor vehicles
Total
£
£
£
£
£
£
Cost
At 1 October 2022
1,985,998
1,291,291
548,365
87,999
106,939
4,020,592
Additions
-
0
136,239
267,333
68,714
106,485
578,771
At 30 September 2023
1,985,998
1,427,530
815,698
156,713
213,424
4,599,363
Depreciation and impairment
At 1 October 2022
709,285
591,950
339,269
64,778
52,606
1,757,888
Depreciation charged in the year
141,857
125,338
71,464
22,832
40,204
401,695
At 30 September 2023
851,142
717,288
410,733
87,610
92,810
2,159,583
Carrying amount
At 30 September 2023
1,134,856
710,242
404,965
69,103
120,614
2,439,780
At 30 September 2022
1,276,713
699,341
209,096
23,221
54,333
2,262,704
12
Financial instruments
2023
2022
£
£
Carrying amount of financial assets
Debt instruments measured at amortised cost
4,281,019
4,063,515
Carrying amount of financial liabilities
Measured at fair value through profit or loss
Measured at amortised cost
4,310,067
4,106,278
13
Stocks
2023
2022
£
£
Finished goods and goods for resale
773,213
616,369
14
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
3,999,232
3,746,127
Other debtors
281,787
317,388
Prepayments and accrued income
234,443
158,301
4,515,462
4,221,816
H G WALTER LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023
- 24 -
15
Creditors: amounts falling due within one year
2023
2022
Notes
£
£
Bank loans and overdrafts
17
88,012
88,575
Obligations under finance leases
18
9,388
6,149
Trade creditors
3,257,860
2,956,219
Corporation tax
1,170,591
700,116
Other taxation and social security
185,497
191,899
Other creditors
112,879
126,989
Accruals and deferred income
162,408
244,667
4,986,635
4,314,614
16
Creditors: amounts falling due after more than one year
2023
2022
Notes
£
£
Bank loans and overdrafts
17
580,622
629,501
Obligations under finance leases
18
98,898
54,178
679,520
683,679
17
Loans and overdrafts
2023
2022
£
£
Bank loans
668,634
717,513
Bank overdrafts
-
0
563
668,634
718,076
Payable within one year
88,012
88,575
Payable after one year
580,622
629,501

The bank loans are secured by guarantees pledged by the directors totalling £1,400,000 in favour of the company's bankers. In addition this is supported by a legal charge over the leasehold premises at 51 and 51A Palliser Road, London, a property owned by a director.

 

A further legal charge is also held over another property owned personally by a director.

 

The Interest on bank loans are charged at 2.95% above the prevailing base rate, and a floating rate basis under which the interest rate will never be less than the margin of 2.95%. The bank loans are repayable by way of equal monthly instalments by 2031.

 

 

H G WALTER LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023
- 25 -
18
Finance lease obligations
2023
2022
Future minimum lease payments due under finance leases:
£
£
Within one year
9,388
6,149
In two to five years
98,898
54,178
108,286
60,327

The arrangement under finance leases are secured by their related assets.

19
Deferred taxation

The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:

Liabilities
Liabilities
2023
2022
Balances:
£
£
Accelerated capital allowances
382,647
384,801
2023
Movements in the year:
£
Liability at 1 October 2022
384,801
Credit to profit or loss
(2,154)
Liability at 30 September 2023
382,647
20
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
106,290
287,022

The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.

The pension cost charge represents contributions payable by the company to the fund and amounted to £106,290 (2022: £287,022). Contributions totalling £22,140 (2022: £37,669) were payable to the fund at the balance sheet date and are included in creditors.

21
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinery shares of 1p each
100
100
1
1
H G WALTER LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023
21
Share capital
(Continued)
- 26 -

The holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled to one vote per share at meetings of the company.

22
Operating lease commitments
Lessee

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

2023
2022
£
£
Within one year
578,371
507,191
Between two and five years
2,781,780
2,486,466
In over five years
504,900
1,401,908
3,865,051
4,395,565
23
Related party transactions
Remuneration of key management personnel

The remuneration of key management personnel is as follows.

2023
2022
£
£
Aggregate compensation
1,140,134
555,742

Rent paid in respect of properties owned by the directors amounted to £54,000 (2022: £54,000).

24
Directors' transactions

Dividends totalling £1,365,762 (2022 - £1,119,008) were paid in the year in respect of shares held by the company's directors.

The directors have pledged guarantees for bank loans totalling £1,400,000. In addition, this is supported by a legal charge over the leasehold premises at 51 and 51A Palliser Road, London, a property owned by a director.

A further legal charge is also held over another property owned personally by a director.

H G WALTER LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023
- 27 -
25
Cash generated from operations
2023
2022
£
£
Profit for the year after tax
3,927,672
2,891,086
Adjustments for:
Taxation charged
1,178,251
696,651
Finance costs
37,961
26,334
Depreciation and impairment of tangible fixed assets
401,695
334,778
Movements in working capital:
Increase in stocks
(156,844)
(206,928)
Increase in debtors
(293,646)
(1,112,592)
Increase in creditors
198,870
552,610
Cash generated from operations
5,293,959
3,181,939
26
Analysis of changes in net funds
1 October 2022
Cash flows
30 September 2023
£
£
£
Cash at bank and in hand
3,465,823
2,600,052
6,065,875
Bank overdrafts
(563)
563
-
0
3,465,260
2,600,615
6,065,875
Borrowings excluding overdrafts
(717,513)
48,879
(668,634)
Obligations under finance leases
(60,327)
(47,959)
(108,286)
2,687,420
2,601,535
5,288,955
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