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Registered number: 11051546










STM GROUP HOLDINGS LTD










ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 JANUARY 2023

 
STM GROUP HOLDINGS LTD
 
 
COMPANY INFORMATION


Director
Mr P B Simpson 




Registered number
11051546



Registered office
Solar House
1st Floor

Romford Road

London

E15 4LJ




Independent auditors
MHA
Chartered Accountants and Statutory Auditors

2 London Wall Place

London

EC2Y 5AU




Bankers
HSBC Bank Plc
59-61 The Mall

London

E15 1XF





 
STM GROUP HOLDINGS LTD
 

CONTENTS



Page
Group Strategic Report
 
1 - 2
Director's Report
 
3 - 5
Independent Auditors' Report
 
6 - 9
Consolidated Statement of Comprehensive Income
 
10
Consolidated Balance Sheet
 
11
Company Balance Sheet
 
12
Consolidated Statement of Changes in Equity
 
13
Company Statement of Changes in Equity
 
14
Consolidated Statement of Cash Flows
 
15 - 16
Consolidated Analysis of Net Debt
 
17
Notes to the Financial Statements
 
18 - 33


 
STM GROUP HOLDINGS LTD
 
 
GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 31 JANUARY 2023

Introduction
 
The Director presents his Report and Financial Statements for the period ended 31 January 2023.

Business review
 
Over the last 12-months the STM Group has been reviewing the business structure and some historic events that have taken place. To realign the business STM Group have adjusted its prior year accounts. These adjustments have in no way effected the current trading position of the company, in fact STM Group is growing and strengthening its position in the marketplace. Over the next 12 months STM are confident there will be an even stronger more stable company with a positive financial standing.

Principal risks and uncertainties
 
The Director is pleased that STM Group, through careful planning and management, now appears to be emerging from this challenging period in good financial shape. The STM business model has been adapted to
address the prevailing challenges, which are expected to continue over the coming year. The primary aim, of promoting the Company profile and market reputation, will continue, with an ongoing focus on its financial performance.
Financial risk
Due to the nature of the industry in which the company operates, there are various financial risks which the
company may be exposed to, namely, credit risk, liquidity risk and interest risk.
Credit risk
The company offers credit terms to its customers that allow payment after delivery of the supply of goods and
services. The company prides itself on strong ongoing customer relationships and this reduces the exposure to
credit risk in the majority of cases.
Liquitity risk
The company seeks to ensure sufficient liquidity is available to meet day-to-day operations and future potential
developments by way of invoice financing arrangements that are used to provide short-term debt flexibility.
Interest risk
The company keeps interest rate exposure under review to ensure this is factored into any business decisions.

Financial key performance indicators
 
During the current reporting period, STM Group (UK) Ltd, the main trading subsidiary of the group, made a pre-tax profit of £302,501, which reflects an encouraging improvement on the previous year. This is a result of improved business management, combined with a focus on delivering the 5 Year Business Plan. Despite the challenging times, the business has continued to invest in people and infrastructure, whilst demonstrating admirable control over key costs. The Balance Sheet has also improved, with not only increased profit for the year but also, equally importantly, the effective management of both debt and liquidity. These improvements are, clearly, evident when compared to previous financial years.

Page 1

 
STM GROUP HOLDINGS LTD
 

GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023

Other key performance indicators
 
The group's other key performance indicator is considered to be its net assets position. This is as follows for
the last two years:
                         
2023               2022
Net Liabilities    £619,093     £763,660


This report was approved by the board and signed on its behalf.



Mr P B Simpson
Director

Date: 6 March 2024

Page 2

 
STM GROUP HOLDINGS LTD
 
 
 
DIRECTOR'S REPORT
FOR THE YEAR ENDED 31 JANUARY 2023

The director presents his report and the financial statements for the year ended 31 January 2023.

Principal activity

The principal activity of the company is that of the holding company.

Director's responsibilities statement

The director is responsible for preparing the Group Strategic Report, the Director's Report and the consolidated financial statements in accordance with applicable law and regulations.
 
Company law requires the director to prepare financial statements for each financial year. Under that law the director has elected to prepare the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the director must not approve the financial statements unless he is satisfied that they give a true and fair view of the state of affairs of the Company and the Group and of the profit or loss of the Group for that period.

 In preparing these financial statements, the director is required to:


select suitable accounting policies for the Group's financial statements and then apply them consistently;

make judgments and accounting estimates that are reasonable and prudent;

prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group will continue in business.

The director is responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and the Group and to enable him to ensure that the financial statements comply with the Companies Act 2006He is also responsible for safeguarding the assets of the Company and the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Results and dividends

The profit for the year, after taxation, amounted to £144,567 (2022 - loss £851,930).

No dividends have been paid in the year (2021 - £Nil).

Director

The director who served during the year was:

Mr P B Simpson 

Future developments

The group is looking to grow each year. The Director considers that the company is well positioned to keep
the ongoing uncertainty of the economic climate following Brexit minimal.
The group oppertes in a highly competitive market and profit margins are constantly squeezed. The Director is therefore conscious that costs and overheads are constantly monitored to maintain a level of profitability within the group. The Director expects the way forward for growth is by building on current relationships and
efficiency.

Page 3

 
STM GROUP HOLDINGS LTD
 
 
 
DIRECTOR'S REPORT (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023

Engagement with employees

The group is an Equal Opportunities and Diversity Aware employer, committed to promoting equality, diversity and inclusion amongst its workforce, whilst eliminating discrimination. Through its Support, Trust,Manage Vision, STM treats all employees as 'internal customers'. The STM aim is to create an inclusive environment and culture, with a diverse workforce that is representative of all sections of society, where everyone has the opportunity to fully contribute, and achieve, individual, full potential.
It is STM's policy to treat all employees (and job applicants) fairly and equally, regardless of individual sex, sexual orientation, gender re-assignment, marriage or civil partnership, pregnancy or maternity, race, colour, creed, nationality, ethnic or national origin, marital status, religion or belief, age, disability, or union membership status.
STM's policy is to recruit disabled workers for those vacancies that they are able to fill. All neccessary assistance with initial training courses is given. Once employed, a career plan is developed so as to ensure suitable opportunities for each disables poerson. Arrangements are made, wherever possible, for retraining employees who become disabled, to enable them to perform work identified as apprropriate for their aptitudes and abilities.
STM, consequently, commits to ensuring every employee is given equal opportunity in every aspect of their working role, with individual differences (and similarities) not only being embraced, but also where individual employee contribution is recognised, celebrated and valued. All STM employees will be given the necessary support and encouragement to develop individual ability and utilise unique talent.
This policy to all aspects of employment, recruitment and related Terms & Conditions of Employment, including pay and benefits, training, appraisals, career development, conduct at work, disciplinary and grievance procedures, termination of employment and all other aspects of employment.

Qualifying third party indemnity provisions

Director's liability and indemnity insurance was in force throughout the year to cover the directors and officers of
the company against actions brought against them in their personal capacities. Cover is not provided where the
individual has acted fraudulently or dishonestly.

Disclosure of information to auditors

Post balance sheet events

There have been no significant events affecting the Group since the year end.

Page 4

 
STM GROUP HOLDINGS LTD
 
 
 
DIRECTOR'S REPORT (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023


Auditors

The auditorsMHAwill be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

This report was approved by the board and signed on its behalf.
 





Mr P B Simpson
Director

Date: 6 March 2024

Page 5

 
STM GROUP HOLDINGS LTD
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF STM GROUP HOLDINGS LTD
 

Opinion


We have audited the financial statements of STM Group Holdings Ltd (the 'parent Company') and its subsidiaries (the 'Group') for the year ended 31 January 2023, which comprise the Group Statement of Comprehensive Income, the Group and Company Balance Sheets, the Group Statement of Cash Flows, the Group and Company Statement of Changes in Equity and the related notes, including a summary of significant accounting policiesThe 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 Group's and of the parent Company's affairs as at 31 January 2023 and of the Group's profit for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.


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 Group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council's Ethical Standard and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.


Conclusions relating to going concern


In auditing the financial statements, we have concluded that the director's use of the going concern basis of accounting in the preparation of the financial statements is appropriate.


Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Group's or the parent Company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.


Our responsibilities and the responsibilities of the director with respect to going concern are described in the relevant sections of this report.


Page 6

 
STM GROUP HOLDINGS LTD
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF STM GROUP HOLDINGS LTD (CONTINUED)


Other information


The other information comprises the information included in the Annual Report other than the financial statements and  our Auditors' Report thereon.  The director is responsible for the other information contained within the Annual Report.  Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated.  If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves.  If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.


We have nothing to report in this regard.


Opinion 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 Group Strategic Report and the Director's Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the Group Strategic Report and the Director's Report 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 Group and the parent Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group Strategic Report or the Director's Report.


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


adequate accounting records have not been kept by the parent Company, or returns adequate for our audit have not been received from branches not visited by us; or
the parent Company financial statements are not in agreement with the accounting records and returns; or
certain disclosures of director's remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.


Responsibilities of directors
 

As explained more fully in the Director's Responsibilities Statement set out on page 3, the director is responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the director determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.


In preparing the financial statements, the director is responsible for assessing the Group's and the parent Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the director either intends to liquidate the Group or the parent Company or to cease operations, or have no realistic alternative but to do so.


Page 7

 
STM GROUP HOLDINGS LTD
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF STM GROUP HOLDINGS LTD (CONTINUED)


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 an Auditors' 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 Group financial statements.


Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

• Obtaining an understanding of the legal and regulatory frameworks that the company operates in;
• Reviewing key correspondence with regulatory authorities;
• Testing for evidence of management override;
• Enquiry of management to identify any instances of non-compliance with laws and regulations;
• Enquiry of management around actual and potential litigation and claims;
• Enquiry of management to identify any instances of known or suspected instances of fraud;
• Discussing among the engagement team regarding how and where fraud might occur.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instance of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or representation.


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 Auditors' Report.


Page 8

 
STM GROUP HOLDINGS LTD
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF STM GROUP HOLDINGS LTD (CONTINUED)


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 2006Our 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 Auditors' 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.





Atul Kariya  FCCA (Senior Statutory Auditor)
  
for and on behalf of
MHA
 
Chartered Accountants and Statutory Auditors
  
London
United Kingdom

14 March 2024
MHA is the trading name of MacIntrye Hudson LLP, a limited liability partnership in England and Wales
(registered number OC312313).
Page 9

 
STM GROUP HOLDINGS LTD
 
 
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 JANUARY 2023

31 January
As restated
14 months ended
31 January
2023
2022
Note
£
£

  

Turnover
 4 
25,477,435
30,533,489

Cost of sales
  
(20,846,719)
(25,947,461)

Gross profit
  
4,630,716
4,586,028

Administrative expenses
  
(4,489,149)
(5,400,978)

Other operating income
 5 
-
66,278

Operating profit/(loss)
 6 
141,567
(748,672)

Interest receivable and similar income
 9 
7,003
6,836

Interest payable and similar expenses
 10 
(4,003)
(15,929)

Profit/(loss) before taxation
  
144,567
(757,765)

Tax on profit/(loss)
 11 
-
(94,165)

Profit/(loss) for the financial year
  
144,567
(851,930)

Profit/(loss) for the year attributable to:
  

Owners of the parent Company
  
144,567
(851,930)

  
144,567
(851,930)

There was no other comprehensive income for 2023 (2022:£NIL).

The notes on pages 18 to 33 form part of these financial statements.

Page 10

 
STM GROUP HOLDINGS LTD
REGISTERED NUMBER: 11051546

CONSOLIDATED BALANCE SHEET
AS AT 31 JANUARY 2023

As restated
2023
2022
Note
£
£

Fixed assets
  

Intangible assets
 12 
768,712
922,453

Tangible assets
 13 
292,620
318,316

  
1,061,332
1,240,769

Current assets
  

Debtors: amounts falling due within one year
 15 
6,287,987
4,792,215

Cash at bank and in hand
 16 
2,246
1,381

  
6,290,233
4,793,596

Creditors: amounts falling due within one year
 17 
(7,970,658)
(6,798,025)

Net current liabilities
  
 
 
(1,680,425)
 
 
(2,004,429)

Total assets less current liabilities
  
(619,093)
(763,660)

Net liabilities
  
(619,093)
(763,660)


Capital and reserves
  

Called up share capital 
 18 
1,001
1,001

Share premium account
 19 
1,324,000
1,324,000

Profit and loss account
 19 
(1,944,094)
(2,088,661)

  
(619,093)
(763,660)


The financial statements were approved and authorised for issue by the board and were signed on its behalf by: 




Mr P B Simpson
Director

Date: 6 March 2024

The notes on pages 18 to 33 form part of these financial statements.

Page 11

 
STM GROUP HOLDINGS LTD
REGISTERED NUMBER: 11051546

COMPANY BALANCE SHEET
AS AT 31 JANUARY 2023

2023
2022
Note
£
£

Fixed assets
  

Investments
 14 
2,760,682
2,760,682

  
2,760,682
2,760,682

Current assets
  

Debtors: amounts falling due within one year
 15 
3,470
3,470

Cash at bank and in hand
 16 
1,168
1,378

  
4,638
4,848

Creditors: amounts falling due within one year
 17 
(1,572,027)
(1,568,044)

Net current liabilities
  
 
 
(1,567,389)
 
 
(1,563,196)

Total assets less current liabilities
  
1,193,293
1,197,486

  

  

Net assets
  
1,193,293
1,197,486


Capital and reserves
  

Called up share capital 
 18 
1,001
1,001

Share premium account
 19 
1,324,000
1,324,000

Profit and loss account
 19 
(131,708)
(127,515)

  
1,193,293
1,197,486


The financial statements were approved and authorised for issue by the board and were signed on its behalf by: 


Mr P B Simpson
Director

Date: 6 March 2024

The notes on pages 18 to 33 form part of these financial statements.

Page 12

 
STM GROUP HOLDINGS LTD
 

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 JANUARY 2023


Called up share capital
Share premium account
Profit and loss account
Equity attributable to owners of parent Company
Total equity

£
£
£
£
£


At 1 December 2020 (as previously stated)
1,001
1,324,000
57,798
1,382,799
1,382,799

Prior year adjustment
-
-
(1,294,529)
(1,294,529)
(1,294,529)


At 1 December 2020 (as restated)
1,001
1,324,000
(1,236,731)
88,270
88,270


Comprehensive income for the period

Loss for the period
-
-
(851,930)
(851,930)
(851,930)
Total comprehensive income for the period
-
-
(851,930)
(851,930)
(851,930)



At 1 February 2022 (as previously stated)
1,001
1,324,000
51,355
1,376,356
1,376,356

Prior year adjustment
-
-
(2,140,016)
(2,140,016)
(2,140,016)


At 1 February 2022 (as restated)
1,001
1,324,000
(2,088,661)
(763,660)
(763,660)


Comprehensive income for the year

Profit for the year
-
-
144,567
144,567
144,567
Total comprehensive income for the year
-
-
144,567
144,567
144,567


At 31 January 2023
1,001
1,324,000
(1,944,094)
(619,093)
(619,093)


The notes on pages 18 to 33 form part of these financial statements.

Page 13

 
STM GROUP HOLDINGS LTD
 

COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 JANUARY 2023


Called up share capital
Share premium account
Profit and loss account
Total equity

£
£
£
£


At 1 December 2020
1,001
1,324,000
(97,893)
1,227,108


Comprehensive income for the period

Loss for the period
-
-
(29,622)
(29,622)


Other comprehensive income for the period
-
-
-
-


Total comprehensive income for the period
-
-
(29,622)
(29,622)


Total transactions with owners
-
-
-
-



At 1 February 2022
1,001
1,324,000
(127,515)
1,197,486


Comprehensive income for the period

Loss for the year
-
-
(4,193)
(4,193)


Other comprehensive income for the year
-
-
-
-


Total comprehensive income for the year
-
-
(4,193)
(4,193)


Total transactions with owners
-
-
-
-


At 31 January 2023
1,001
1,324,000
(131,708)
1,193,293


The notes on pages 18 to 33 form part of these financial statements.

Page 14

 
STM GROUP HOLDINGS LTD
 

CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 JANUARY 2023

As restated
2023
2022
£
£

Cash flows from operating activities

Profit/(loss) for the financial year
144,567
(851,930)

Adjustments for:

Amortisation of intangible assets
153,741
179,365

Depreciation of tangible assets
33,346
41,428

Government grants
-
(66,278)

Interest paid
4,003
15,929

Interest received
(7,003)
(6,836)

Taxation charge
-
94,165

(Increase)/decrease in debtors
(1,495,772)
520,613

Increase in creditors
688,821
527,547

Corporation tax (paid)
(3,671)
(142,242)

Net cash generated from operating activities

(481,968)
311,761


Cash flows from investing activities

Purchase of tangible fixed assets
(7,650)
(18,922)

Government grants received
-
66,278

Interest received
7,003
6,836

Net cash from investing activities

(647)
54,192
Page 15

 
STM GROUP HOLDINGS LTD
 

CONSOLIDATED STATEMENT OF CASH FLOWS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023

As restated

2023
2022

£
£



Cash flows from financing activities

Repayment of loans
(220,973)
(274,027)

Interest paid
(4,003)
(15,929)

Net cash used in financing activities
(224,976)
(289,956)

Net (decrease)/increase in cash and cash equivalents
(707,591)
75,997

Cash and cash equivalents at beginning of year
(350,506)
(426,503)

Cash and cash equivalents at the end of year
(1,058,097)
(350,506)


Cash and cash equivalents at the end of year comprise:

Cash at bank and in hand
2,246
1,381

Bank overdrafts
(1,060,343)
(351,887)

(1,058,097)
(350,506)


The notes on pages 18 to 33 form part of these financial statements.

Page 16

 
STM GROUP HOLDINGS LTD
 

CONSOLIDATED ANALYSIS OF NET DEBT
FOR THE YEAR ENDED 31 JANUARY 2023




At 1 February 2022
Cash flows
At 31 January 2023
£

£

£

Cash at bank and in hand

1,381

865

2,246

Bank overdrafts

(351,887)

(708,456)

(1,060,343)

Debt due within 1 year

(220,973)

220,973

-


(571,479)
(486,618)
(1,058,097)

The notes on pages 18 to 33 form part of these financial statements.

Page 17

 
STM GROUP HOLDINGS LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023

1.


General information

STM Group Holdings Ltd is a private company limited by shares incorporated in England and Wales in the United Kingdom. The registered office of the entity is Solar House, 1st Floor, Romford Road, London, E15 4LJ. The principal activity of the company is that of the holding company.
The financial statements have been prepared for the 12 months to 31 January 2023. The comparative
figures are for a 14 month period and are therefore not entirely comparable.

2.Accounting policies

 
2.1

Basis of preparation of financial statements

The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.

The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires Group management to exercise judgment in applying the Group's accounting policies (see note 3).

The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of Comprehensive Income in these financial statements.

The following principal accounting policies have been applied:

 
2.2

Basis of consolidation

The consolidated financial statements present the results of the Company and its own subsidiaries ("the Group") as if they form a single entity. Intercompany transactions and balances between group companies are therefore eliminated in full.
The consolidated financial statements incorporate the results of business combinations using the purchase method. In the Balance Sheet, the acquiree's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquired operations are included in the Consolidated Statement of Comprehensive Income from the date on which control is obtained. They are deconsolidated from the date control ceases.
In accordance with the transitional exemption available in FRS 102, the Group has chosen not to retrospectively apply the standard to business combinations that occurred before the date of transition to FRS 102, being 01 January 2014.

Page 18

 
STM GROUP HOLDINGS LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023

2.Accounting policies (continued)

 
2.3

Revenue

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group 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:

Rendering of services

Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:
the amount of revenue can be measured reliably;
it is probable that the Group will receive the consideration due under the contract;
the stage of completion of the contract at the end of the reporting period can be measured reliably; and
the costs incurred and the costs to complete the contract can be measured reliably.

 
2.4

Operating leases: the Group as lessee

Rentals paid under operating leases are charged to profit or loss on a straight-line basis over the lease term.

 
2.5

Government grants

Grants are accounted under the accruals model as permitted by FRS 102. Grants relating to expenditure on tangible fixed assets are credited to profit or loss at the same rate as the depreciation on the assets to which the grant relates. The deferred element of grants is included in creditors as deferred income.
Grants of a revenue nature are recognised in the Consolidated Statement of Comprehensive Income in the same period as the related expenditure.

 
2.6

Interest income

Interest income is recognised in profit or loss using the effective interest method.

 
2.7

Finance costs

Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.

 
2.8

Borrowing costs

All borrowing costs are recognised in profit or loss in the year in which they are incurred.

Page 19

 
STM GROUP HOLDINGS LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023

2.Accounting policies (continued)

 
2.9

Pensions

Defined contribution pension plan

The Group operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Group pays fixed contributions into a separate entity. Once the contributions have been paid the Group has no further payment obligations.

The contributions are recognised as an expense in profit or loss 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 Group in independently administered funds.

 
2.10

Taxation

Tax is recognised in profit or loss 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 and the Group 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 Group 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.

Page 20

 
STM GROUP HOLDINGS LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023

2.Accounting policies (continued)

 
2.11

Intangible assets

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 Group'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 Consolidated Statement of Comprehensive Income over its useful economic life.

Other 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.

 
2.12

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, on a reducing balance basis.

Depreciation is provided on the following basis:

Motor vehicles
-
15%
Fixtures and fittings
-
10%
Office equipment
-
8%
Computer equipment
-
8%

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 profit or loss.

 
2.13

Valuation of investments

Investments in subsidiaries are measured at cost less accumulated impairment.

Page 21

 
STM GROUP HOLDINGS LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023

2.Accounting policies (continued)

 
2.14

Debtors

Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.

 
2.15

Cash and cash equivalents

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.

In the Consolidated Statement of Cash Flows, cash and cash equivalents are shown net of bank overdrafts that are repayable on demand and form an integral part of the Group's cash management.

 
2.16

Creditors

Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.

 
2.17

Financial instruments

The Group 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 that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the Consolidated Statement of Comprehensive Income.

For financial assets measured at amortised cost, the impairment loss is measured as the difference between an asset's carrying amount and the present value of estimated cash flows discounted at the asset's original effective interest rate. If a financial asset has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate determined under the contract.

For financial assets measured at cost less impairment, the impairment loss is measured as the difference between an asset's carrying amount and best estimate of the recoverable amount, which is an approximation of the amount that the Group would receive for the asset if it were to be sold at the
Page 22

 
STM GROUP HOLDINGS LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023

2.Accounting policies (continued)


2.17
Financial instruments (continued)

balance sheet date.

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.


3.


Judgments in applying accounting policies and key sources of estimation uncertainty

The director considers that the critical accounting policies where judgments and estimations have been
applied relate to the intangible and tangible asset lives, in particular the useful economic life of the goodwill, and residual values of plant and machinery, and the recoverability of trade debtors. The director has concluded that the asset values and residual values are appropriate for plant and machinery and that trade debtors are appropriately valued.


4.


Turnover

An analysis of turnover by class of business is as follows:


31 January
14 months ended
31 January
2023
2022
£
£

Sales
25,477,435
30,533,489

25,477,435
30,533,489


Analysis of turnover by country of destination:

31 January
14 months ended
31 January
2023
2022
£
£

United Kingdom
25,477,435
30,533,489

25,477,435
30,533,489


Page 23

 
STM GROUP HOLDINGS LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023

5.


Other operating income

31 January
14 months ended
31 January
2023
2022
£
£

Government grants receivable - CJRS
-
66,278

-
66,278



6.


Operating profit/(loss)

The operating profit/(loss) is stated after charging:

31 January
14 months ended
31 January
2023
2022
£
£

Other operating lease rentals
36,416
66,660


7.


Auditors' remuneration

During the year, the Group obtained the following services from the Company's auditors:


31 January
14 months ended
31 January
2023
2022
£
£

Fees payable to the Company's auditors for the audit of the consolidated and parent Company's financial statements
24,000
20,000

Page 24

 
STM GROUP HOLDINGS LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023

8.


Employees

Staff costs were as follows:


Group
Group
Company
Company
2023
2022
2023
2022
£
£
£
£


Wages and salaries
17,755,214
23,554,833
-
-

Social security costs
1,457,818
1,832,045
-
-

Cost of defined contribution pension scheme
227,470
320,878
-
-

19,440,502
25,707,756
-
-


The average monthly number of employees, including the director, during the year was as follows:


      31 January
   14 months ended
       31 January
        2023
        2022
            No.
            No.







Directors
1
1



Employees
824
919

825
920

The Company has no employees other than the directors, who did not receive any remuneration (2022 - £NIL)

9.


Interest receivable

31 January
14 months ended
31 January
2023
2022
£
£


Other interest receivable
7,003
6,836

7,003
6,836

Page 25

 
STM GROUP HOLDINGS LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023

10.


Interest payable and similar expenses

31 January
14 months ended
31 January
2023
2022
£
£


Bank interest payable
4,003
15,929

4,003
15,929


11.


Taxation


31 January
As restated
14 months ended
31 January
2023
2022
£
£

Corporation tax


Current tax on profits for the year
-
94,165


-
94,165


Total current tax
-
94,165

Deferred tax

Total deferred tax
-
-


Taxation on profit on ordinary activities
-
94,165
Page 26

 
STM GROUP HOLDINGS LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023
 
11.Taxation (continued)


Factors affecting tax charge for the year/period

The tax assessed for the year/period is higher than (2022 - higher than) the standard rate of corporation tax in the UK of 19% (2022 - 19%). The differences are explained below:

31 January
14 months ended
31 January
2023
2022
£
£


Profit/(loss) on ordinary activities before tax
144,567
(757,765)


Profit/(loss) on ordinary activities multiplied by standard rate of corporation tax in the UK of 19% (2022 - 19%)
27,468
(143,975)

Effects of:


Expenses not deductible for tax purposes, other than goodwill amortisation and impairment
7,367
7,379

Utilisation of tax losses
(34,835)
-

Unrelieved tax losses carried forward
-
230,761

Total tax charge for the year/period
-
94,165


Factors that may affect future tax charges

The rate of corporation tax increased at April 2023 to 25%

Page 27

 
STM GROUP HOLDINGS LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023

12.


Intangible assets

Group and Company





Goodwill

£



Cost


At 1 February 2022
1,537,412



At 31 January 2023

1,537,412



Amortisation


At 1 February 2022
614,959


Charge for the year on owned assets
153,741



At 31 January 2023

768,700



Net book value



At 31 January 2023
768,712



At 31 January 2022
922,453



Page 28

 
STM GROUP HOLDINGS LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023

13.


Tangible fixed assets

Group






Motor vehicles
Fixtures and fittings
Office equipment
Computer equipment
Total

£
£
£
£
£



Cost or valuation


At 1 February 2022
109,915
32,932
390,704
117,347
650,898


Additions
-
148
-
7,502
7,650



At 31 January 2023

109,915
33,080
390,704
124,849
658,548



Depreciation


At 1 February 2022
84,488
27,342
182,650
38,102
332,582


Charge for the year on owned assets
5,448
916
18,358
8,624
33,346



At 31 January 2023

89,936
28,258
201,008
46,726
365,928



Net book value



At 31 January 2023
19,979
4,822
189,696
78,123
292,620



At 31 January 2022
25,427
5,590
208,054
79,245
318,316


14.


Fixed asset investments

Company





Investments in subsidiary companies

£



Cost or valuation


At 1 February 2022
2,760,682



At 31 January 2023
2,760,682




Page 29

 
STM GROUP HOLDINGS LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023

Subsidiary undertaking


The following was a subsidiary undertaking of the Company:

Name

Registered office

Class of shares

Holding

STM Group (UK) Limited
Solar House, 1st Floor, Romford Road, London, E15 4LJ
Ordinary
100%


15.


Debtors

Group

Group
As restated
Company

Company
As restated
2023
2022
2023
2022
£
£
£
£


Trade debtors
4,233,611
3,224,185
-
-

Other debtors
470,498
280,849
3,470
3,470

Prepayments and accrued income
1,529,044
1,232,347
-
-

Tax recoverable
54,834
54,834
-
-

6,287,987
4,792,215
3,470
3,470



16.


Cash and cash equivalents

Group
Group
Company
Company
2023
2022
2023
2022
£
£
£
£

Cash at bank and in hand
2,246
1,381
1,168
1,378

Less: bank overdrafts
(1,060,343)
(351,887)
-
-

(1,058,097)
(350,506)
1,168
1,378


Page 30

 
STM GROUP HOLDINGS LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023

17.


Creditors: Amounts falling due within one year

Group

Group
As restated
Company

Company
As restated
2023
2022
2023
2022
£
£
£
£

Bank overdrafts
1,060,343
351,887
-
-

Bank loans
-
220,973
-
220,973

Trade creditors
2,566,504
2,047,040
-
-

Amounts owed to group undertakings
-
-
1,569,277
1,344,321

Corporation tax
90,494
94,165
-
-

Other taxation and social security
-
52,663
-
-

Other creditors
3,412,304
2,921,283
-
-

Accruals and deferred income
841,013
1,110,014
2,750
2,750

7,970,658
6,798,025
1,572,027
1,568,044


The bank loan and overdraft are secured on the assets of the company. 


18.


Share capital

2023
2022
£
£
Allotted, called up and fully paid



1,001 (2022 - 1,001) Ordinary shares of £1.00 each
1,001
1,001



19.


Reserves

Share premium account

Changes in the share premium account are set out in the Statement of Changes in Equity.

Profit and loss account

The Profit and loss account is represented by retained earnings. Changes in reserves are set out in the
Statement of Changes in Equity.

Page 31

 
STM GROUP HOLDINGS LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023

20.


Prior year adjustment

The financial statements of the group for the period ended 31 January 2022 and have been restated to  correctly include additional costs which were subject to extensive estimate and judgement.
The prior period adjustments include £1,294,529 relating to amounts brought forward at 1 December 2020 in relation to incorrectly classified transactions. This adjustment resulted in a decrease in reserves at 1 December 2020 and an increase in creditor balances at that date of £1,294,529.
The profit in the period to 31 January 2022 has been adjusted by £845,487 to a loss of £851,930 due to the inclusion of additional costs. This has resulted in a decrease to the profit and loss account of £845,487 and an increase in creditors.


21.


Pension commitments

The group 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 £227,470 (2022 - £271,485). Contributions totaling £6,508 (2022 - £6,202) were payable to the fund at the balance sheet date and are included in creditors.


22.


Commitments under operating leases

At 31 January 2023 the Group and the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:


Group
Group
2023
2022
£
£


Not later than 1 year
220,416
170,000

Later than 1 year and not later than 5 years
26,685
-

247,101
170,000
Group
Group
2023
2022
£
£


Not later than 1 year
10,743
50,059

Later than 1 year and not later than 5 years
15,144
30,006

25,887
80,065


23.


Transactions with directors

During the year, the group made advances totaling £Nil (2022 - £Nil) to Mr P B Simpson, the director, and received credits of £Nil (2022 - £Nil). Interest of £7,003 (2022 - £6,736) has been charged at commercial rates on overdrawn balances. As at 31 January 2023, Mr P B Simpson owed the group £287,136 (2022 - £280,133). The loan is unsecured and repayable on demand.

Page 32

 
STM GROUP HOLDINGS LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023

24.


Related party transactions

During the year, STM Cleaning Ltd, a limited liability company of which the director, Mr P B Simpson, is a
shareholder, provided services to the group totaling £3,200,271 (2022 - £1,613,986). STM Cleaning Ltd also received services from the group during the year totaling £3,200,271 (2022 - £1,615,637). As at 31 January 2023, STM Group Holding Ltd owed £Nil to STM Cleaning Ltd (2022 - £542). These transactions were on normal commercial terms.


25.


Controlling party

The group was under the control of the director, Mr P B Simpson, throughout the current year and prior period.

 
Page 33