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COMPANY REGISTRATION NUMBER: 04516852
CHESTERFIELD POULTRY LIMITED
FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 June 2023
CHESTERFIELD POULTRY LIMITED
FINANCIAL STATEMENTS
YEAR ENDED 30 JUNE 2023
CONTENTS
PAGE
Strategic report
1
Directors' report
4
Independent auditor's report to the members
6
Statement of income and retained earnings
11
Statement of financial position
12
Statement of cash flows
13
Notes to the financial statements
14
CHESTERFIELD POULTRY LIMITED
STRATEGIC REPORT
YEAR ENDED 30 JUNE 2023
Business review We aim to present a balanced and comprehensive review of the development and performance of our business during the year and its position at the year end. Our review is consistent with the size and non complex nature of our business and is written in the context of the risks and uncertainties we face. The company continues to supply halal poultry chicken to businesses in the United Kingdom. The directors consider the key performance indicators of the company to be turnover and net profit. Turnover for the year is £204,520,405 compared to £163,082,350 in 2022, an increase of 25.4%. Overall, the company has achieved a profit before tax of £10,909,673 compared to £7,633,717 in the previous year, a result which the directors are satisfied with given the increase in turnover. The company has seen administrative expenses level off as the continued development of new premises acquired in 2014 continues. Work continues to be undertaken to the property which, whilst fully operational, continues to require improvements and modifications. A parent company was incorporated on 27th April 2022 called Chesterfield Poultry Holdings Limited Principal risks and uncertainties The principal risks and uncertainties facing the company continue to be the cost of poultry, which in itself is affected by the market price of feed, and the market price for the end product, affected by supply and demand. The directors closely monitor these to ensure that the company remains competitive and profitable. The directors are satisfied that the company is adequately placed for another successful year. Plans for the future With support from our team and financial backers, we are confident that the 2024 year end will be another profitable year. Engagement with suppliers, customers and others in a business relationship with the company Management monitor closely how suppliers, customers, and other business relationships are managed. The company has fostered good working relationships with the various suppliers and customers, who are paid on a timely basis to ensure no disruption to the supply chain, and payments from customers are closely monitored to ensure cashflow is not affected. Promoting the success of the company Management constantly review the operations of the company to ensure the welfare of the employees, reputation of the company and its impact on the local environment are meeting the highest standards in accordance with all legal and industry requirements so that they ultimately benefit and contribute to the overall success of the company. Support of a local football team via sponsorship gives visible promotion of the company in the local area, as well as utilisation of social media platforms. Streamlined energy and carbon reporting UK Greenhouse gas emissions and energy use data for the year ended 30 June 2023:
2023 2022
Energy consumption used to calculate emissions (kWh) 10,205,648 9,841,835
Scope 1 emissions in metric tonnes CO2e
Gas 1,863 1,786
Scope 2 emissions in metric tonnes CO2e
Purchased electricity 1,395 1,793
Scope 3 emissions in metric tonnes CO2e
Business travel in employee owned vehicles 3 5
Total gross emissions in metric tonnes CO2e 3,261 3,584
Intensity ratio
Tonnes / £m of turnover 16 22
Quantification and reporting methodology We have followed the 2019 HM Government Environmental Reporting Guidelines. We have also used the GHG Reporting Protocol – Corporate Standard and have used the 2023 UK Government's Conversion Factors for Company Reporting. Intensity measurement The chosen intensity measurement ratio is total gross emissions in metric tonnes CO2e per £1m of turnover which we believe is an appropriate ratio for the size of the company and the sector we operate. Measures taken to improve efficiency Processes are monitored to ensure any efficiencies are gained, specific measures taken include: Use of LED lighting in place of standard tungsten / halogen lighting throughout the site; Meetings are held remotely where possible to reduce unnecessary travelling; and Working with a utilities provider to reduce electricity consumption via the use of additional consumption data.
This report was approved by the board of directors on 14 March 2024 and signed on behalf of the board by:
M F Ahmed
Director
Registered office:
5 Coulman Street
Thorne
Doncaster
DN8 5JT
CHESTERFIELD POULTRY LIMITED
DIRECTORS' REPORT
YEAR ENDED 30 JUNE 2023
The directors present their report and the financial statements of the company for the year ended 30 June 2023 .
DIRECTORS
The directors who served the company during the year were as follows:
M F Ahmed
N Iqbal
K Ahmed
DIVIDENDS
Particulars of recommended dividends are detailed in note 14 to the financial statements.
DISCLOSURE OF INFORMATION IN THE STRATEGIC REPORT
Information required by schedule 7 of the Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008 has been included in the Strategic Report.
DIRECTORS' RESPONSIBILITIES STATEMENT
The directors are responsible for preparing the strategic report, directors' 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 the profit or loss of the company for that period. In preparing these financial statements, the directors are required to: - select suitable accounting policies and then apply them consistently; - make 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 company will continue in business. The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. AUDITOR
Each of the persons who is a director at the date of approval of this report confirms that:
- so far as they are aware, there is no relevant audit information of which the company's auditor is unaware; and - they have taken all steps that they ought to have taken as a director to make themselves aware of any relevant audit information and to establish that the company's auditor is aware of that information.
This report was approved by the board of directors on 14 March 2024 and signed on behalf of the board by:
M F Ahmed
Director
Registered office:
5 Coulman Street
Thorne
Doncaster
DN8 5JT
CHESTERFIELD POULTRY LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF CHESTERFIELD POULTRY LIMITED
YEAR ENDED 30 JUNE 2023
OPINION
We have audited the financial statements of Chesterfield Poultry Limited (the 'company') for the year ended 30 June 2023 which comprise the statement of income and retained earnings, statement of financial position, statement of cash flows and the related notes, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice). In our opinion the financial statements: - give a true and fair view of the state of the company's affairs as at 30 June 2023 and of its profit for the year then ended; - have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; - 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 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. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
OPINIONS ON OTHER MATTERS PRESCRIBED BY THE COMPANIES ACT 2006
In our opinion, based on the work undertaken in the course of the audit:
- the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
- the strategic report and the directors' 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 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: - adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or - the financial statements are not in agreement with the accounting records and returns; or - certain disclosures of directors' remuneration specified by law are not made; or - we have not received all the information and explanations we require for our audit.
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. 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: Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows: - the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations; - we identified the laws and regulations applicable to the company through discussions with directors and other management, and from our commercial knowledge and experience of the company and sector in which it operates; - we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the company, including the Companies Act 2006, taxation legislation, data protection, anti-bribery, employment, environmental and health and safety legislation; - we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal correspondence; and - identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit. We assessed the susceptibility of the company's financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by: - making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; and - considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations. To address the risk of fraud through management bias and override of controls, we: - performed analytical procedures to identify any unusual or unexpected relationships; - tested journal entries to identify unusual transactions; - assessed whether judgements and assumptions made in determining the accounting estimates set out in Note 3 were indicative of potential bias; and - investigated the rationale behind significant or unusual transactions. In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to: - agreeing financial statement disclosures to underlying supporting documentation; - reading the minutes of meetings of those charged with governance; - enquiring of management as to actual and potential litigation and claims; and - reviewing correspondence with HMRC, relevant regulators and the company's legal advisors. There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any. Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion. As part of an audit in accordance with ISAs (UK), we exercise professional judgment and maintain professional scepticism throughout the audit. We also: - Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. - Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the internal control. - Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors. - Conclude on the appropriateness of the directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the company to cease to continue as a going concern. - Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
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.
ROBERT ANDERSON
(Senior Statutory Auditor)
For and on behalf of
Streets Audit LLP
Chartered accountants & statutory auditor
Tower House
Lucy Tower Street
Lincoln
LN1 1XW
15 March 2024
CHESTERFIELD POULTRY LIMITED
STATEMENT OF INCOME AND RETAINED EARNINGS
YEAR ENDED 30 JUNE 2023
2023
2022
Note
£
£
TURNOVER
4
204,520,405
163,082,350
Cost of sales
( 152,067,920)
( 116,848,465)
---------------
---------------
GROSS PROFIT
52,452,485
46,233,885
Distribution costs
( 14,176,158)
( 11,695,677)
Administrative expenses
( 27,368,566)
( 26,802,904)
Other operating income
5
91,800
86,855
---------------
---------------
OPERATING PROFIT
6
10,999,561
7,822,159
Other interest receivable and similar income
10
62,581
6,476
Amounts written back to investments
11
( 50)
Interest payable and similar expenses
12
( 152,469)
( 194,868)
---------------
---------------
PROFIT BEFORE TAXATION
10,909,673
7,633,717
Tax on profit
13
( 2,670,788)
( 1,868,414)
---------------
-------------
PROFIT FOR THE FINANCIAL YEAR AND TOTAL COMPREHENSIVE INCOME
8,238,885
5,765,303
---------------
-------------
Dividends paid and payable
14
( 13,800,000)
( 870,000)
RETAINED EARNINGS AT THE START OF THE YEAR
23,536,843
18,641,540
---------------
---------------
RETAINED EARNINGS AT THE END OF THE YEAR
17,975,728
23,536,843
---------------
---------------
All the activities of the company are from continuing operations.
CHESTERFIELD POULTRY LIMITED
STATEMENT OF FINANCIAL POSITION
30 June 2023
2023
2022
Note
£
£
£
FIXED ASSETS
Tangible assets
15
18,405,349
14,302,490
Investments
16
50
50
---------------
---------------
18,405,399
14,302,540
CURRENT ASSETS
Stocks
17
1,661,357
1,547,939
Debtors
18
18,937,430
22,933,837
Cash at bank and in hand
6,063,455
13,102,964
---------------
---------------
26,662,242
37,584,740
CREDITORS: amounts falling due within one year
19
23,503,674
24,965,582
---------------
---------------
NET CURRENT ASSETS
3,158,568
12,619,158
---------------
---------------
TOTAL ASSETS LESS CURRENT LIABILITIES
21,563,967
26,921,698
CREDITORS: amounts falling due after more than one year
20
1,708,233
1,840,849
PROVISIONS
Taxation including deferred tax
22
1,880,000
1,544,000
---------------
---------------
NET ASSETS
17,975,734
23,536,849
---------------
---------------
CAPITAL AND RESERVES
Called up share capital
26
6
6
Profit and loss account
27
17,975,728
23,536,843
---------------
---------------
SHAREHOLDERS FUNDS
17,975,734
23,536,849
---------------
---------------
These financial statements were approved by the board of directors and authorised for issue on 14 March 2024 , and are signed on behalf of the board by:
M F Ahmed
Director
Company registration number: 04516852
CHESTERFIELD POULTRY LIMITED
STATEMENT OF CASH FLOWS
YEAR ENDED 30 JUNE 2023
2023
2022
£
£
CASH FLOWS FROM OPERATING ACTIVITIES
Profit for the financial year
8,238,885
5,765,303
Adjustments for:
Depreciation of tangible assets
2,042,224
1,761,039
Other interest receivable and similar income
( 62,581)
( 6,476)
Interest payable and similar expenses
152,469
194,868
Loss on disposal of tangible assets
121,314
Tax on profit
2,670,788
1,868,414
Accrued expenses
92,273
1,470,052
Changes in:
Stocks
( 113,418)
( 184,632)
Trade and other debtors
3,996,407
1,484,253
Trade and other creditors
182,809
5,142,933
---------------
---------------
Cash generated from operations
17,199,856
17,617,068
Interest paid
( 152,469)
( 194,868)
Interest received
62,581
6,476
Tax (paid)/received
( 3,200,000)
421,982
---------------
---------------
Net cash from operating activities
13,909,968
17,850,658
---------------
---------------
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of tangible assets
( 6,145,083)
( 3,359,086)
Proceeds from sale of tangible assets
4,666
Proceeds from sale of subsidiaries
50
---------------
---------------
Net cash used in investing activities
( 6,145,083)
( 3,354,370)
---------------
---------------
CASH FLOWS FROM FINANCING ACTIVITIES
Repayments of borrowings
( 759,218)
( 2,505,989)
Payments of finance lease liabilities
( 245,176)
( 447,714)
Dividends paid
( 13,800,000)
( 870,000)
---------------
---------------
Net cash used in financing activities
( 14,804,394)
( 3,823,703)
---------------
---------------
NET (DECREASE)/INCREASE IN CASH AND CASH EQUIVALENTS
( 7,039,509)
10,672,585
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR
13,102,964
2,430,379
---------------
---------------
CASH AND CASH EQUIVALENTS AT END OF YEAR
6,063,455
13,102,964
---------------
---------------
CHESTERFIELD POULTRY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
YEAR ENDED 30 JUNE 2023
1. GENERAL INFORMATION
The company is a private company limited by shares, registered in England and Wales. The address of the registered office is 5 Coulman Street, Thorne, Doncaster, DN8 5JT.
2. STATEMENT OF COMPLIANCE
These financial statements have been prepared in compliance with FRS 102, 'The Financial Reporting Standard applicable in the UK and the Republic of Ireland'.
3. ACCOUNTING POLICIES
Basis of preparation
The financial statements have been prepared on the historical cost basis, as modified by the revaluation of certain financial assets and liabilities and investment properties measured at fair value through profit or loss.
The financial statements are prepared in sterling, which is the functional currency of the entity.
Judgements and key sources of estimation uncertainty
The directors make estimates and assumptions about the future. These estimates and assumptions impact recognised assets and liabilities, as well as revenue and expenses and other disclosures. These estimates are based on historical experience and on various assumptions considered reasonable under the prevailing conditions. The actual outcome may diverge from these estimates if other assumptions are made, or other conditions arise. The estimates and assumptions that may have a significant effect on the carrying amounts of assets and liabilities within financial year include: Tangible fixed assets are recognised at cost, less accumulated depreciation and any impairments. Depreciation takes place over the estimated useful life, down to the assessed residual value. The carrying amount of the company's fixed assets is tested as soon as changed conditions show that a need for impairment has arisen. The recoverability of debtors and associated provisioning is considered on a regular basis. When calculating the debtor provision, the directors consider the age of the debts and the financial position of its customers. Recoverability of related party debtors is also considered.
Revenue recognition
Turnover is measured at the fair value of the consideration received or receivable for goods supplied and services rendered, net of discounts and Value Added Tax. Revenue from the sale of goods is recognised when the significant risks and rewards of ownership have transferred to the buyer (usually on despatch of the goods); the amount of revenue can be measured reliably; it is probable that the associated economic benefits will flow to the entity; and the costs incurred or to be incurred in respect of the transactions can be measured reliably.
Income tax
The taxation expense represents the aggregate amount of current and deferred tax recognised in the reporting period. Tax is recognised in profit or loss, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, tax is recognised in other comprehensive income or directly in equity, respectively. Current tax is recognised on taxable profit for the current and past periods. Current tax is measured at the amounts of tax expected to pay or recover using the tax rates and laws that have been enacted or substantively enacted at the reporting date. Deferred tax is recognised in respect of all material timing differences that have originated but not reversed at the balance sheet date where transactions or events have occurred at that date that will result in an obligation to pay more, or a right to pay less or to receive more tax. Deferred tax is measured on an undiscounted basis at the tax rates that are expected to apply in the periods in which timing differences reverse, based on tax rates and laws enacted or substantively enacted at the balance sheet date.
Foreign currencies
Foreign currency transactions are initially recorded in the functional currency, by applying the spot exchange rate as at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated at the exchange rate ruling at the reporting date, with any gains or losses being taken to the profit and loss account.
Operating leases
Lease payments are recognised as an expense over the lease term on a straight-line basis. Lease income is recognised in profit or loss on a straight line basis over the lease term. The aggregate cost of lease incentives are recognised as a reduction to income over the lease term on a straight-line basis. Costs, including depreciation, incurred in earning the lease income are recognised as an expense. Any initial direct costs incurred in negotiating and arranging the operating lease are added to the carrying amount of the lease and recognised as an expense over the lease term on the same basis as the lease income.
Tangible assets
Tangible assets are initially recorded at cost, and subsequently stated at cost less any accumulated depreciation and impairment losses. Any tangible assets carried at revalued amounts are recorded at the fair value at the date of revaluation less any subsequent accumulated depreciation and subsequent accumulated impairment losses.
Depreciation
Depreciation is calculated so as to write off the cost or valuation of an asset, less its residual value, over the useful economic life of that asset as follows:
Building Improvements
-
20% reducing balance
Plant & Machinery
-
8%/33% straight line/20% reducing balance
Fixtures & Fittings
-
20% reducing balance
Motor Vehicles
-
20% reducing balance
Depreciation on freehold property is not provided for in the financial statements on the grounds of immateriality. The directors consider freehold properties to have a long useful economic life and the residual value of the freehold properties not to be materially different from the value in the financial statements.
Investment property
Investment property is initially recorded at cost, which includes purchase price and any directly attributable expenditure. Investment property is revalued to its fair value at each reporting date and any changes in fair value are recognised in profit or loss.
Investments in subsidiaries and associates
Investments in associates and subsidiaries accounted for in accordance with the cost model are recorded at cost less any accumulated impairment losses. Dividends and other distributions received from the investment are recognised as income without regard to whether the distributions are from accumulated profits of the associate arising before or after the date of acquisition.
Impairment of fixed assets
A review for indicators of impairment is carried out at each reporting date, with the recoverable amount being estimated where such indicators exist. Where the carrying value exceeds the recoverable amount, the asset is impaired accordingly. Prior impairments are also reviewed for possible reversal at each reporting date. For the purposes of impairment testing, when it is not possible to estimate the recoverable amount of an individual asset, an estimate is made of the recoverable amount of the cash-generating unit to which the asset belongs. The cash-generating unit is the smallest identifiable group of assets that includes the asset and generates cash inflows that largely independent of the cash inflows from other assets or groups of assets.
Stocks
Stocks are valued at the lower of cost and net realisable value, on a first in, first out basis, after making due allowance for obsolete and slow moving items.
Finance leases and hire purchase contracts
Assets held under finance leases and hire purchase contracts are recognised in the statement of financial position as assets and liabilities at the lower of the fair value of the assets and the present value of the minimum lease payments, which is determined at the inception of the lease term. Any initial direct costs of the lease are added to the amount recognised as an asset. Lease payments are apportioned between the finance charges and reduction of the outstanding lease liability using the effective interest method. Finance charges are allocated to each period so as to produce a constant rate of interest on the remaining balance of the liability.
Provisions
Provisions are recognised when the entity has an obligation at the reporting date as a result of a past event, it is probable that the entity will be required to transfer economic benefits in settlement and the amount of the obligation can be estimated reliably. Provisions are recognised as a liability in the statement of financial position and the amount of the provision as an expense. Provisions are initially measured at the best estimate of the amount required to settle the obligation at the reporting date and subsequently reviewed at each reporting date and adjusted to reflect the current best estimate of the amount that would be required to settle the obligation. Any adjustments to the amounts previously recognised are recognised in profit or loss unless the provision was originally recognised as part of the cost of an asset. When a provision is measured at the present value of the amount expected to be required to settle the obligation, the unwinding of the discount is recognised as a finance cost in profit or loss in the period it arises.
Financial instruments
A financial asset or a financial liability is recognised only when the entity becomes a party to the contractual provisions of the instrument. Basic financial instruments are initially recognised at the transaction price, unless the arrangement constitutes a financing transaction, where it is recognised at the present value of the future payments discounted at a market rate of interest for a similar debt instrument. Debt instruments are subsequently measured at amortised cost. Financial assets that are measured at cost or amortised cost are reviewed for objective evidence of impairment at the end of each reporting date. If there is objective evidence of impairment, an impairment loss is recognised in profit or loss immediately. Any reversals of impairment are recognised in profit or loss immediately, to the extent that the reversal does not result in a carrying amount of the financial asset that exceeds what the carrying amount would have been had the impairment not previously been recognised.
Defined contribution plans
Contributions to defined contribution plans are recognised as an expense in the period in which the related service is provided.
4. TURNOVER
Turnover arises from:
2023
2022
£
£
Sale of goods
204,520,405
163,082,350
---------------
---------------
The whole of the turnover is attributable to the principal activity of the company wholly undertaken in the United Kingdom.
5. OTHER OPERATING INCOME
2023
2022
£
£
Rental income
91,800
86,855
---------
---------
6. OPERATING PROFIT
Operating profit or loss is stated after charging/crediting:
2023
2022
£
£
Depreciation of tangible assets
2,042,224
1,761,039
Loss on disposal of tangible assets
121,314
Impairment of trade debtors
257,027
98,841
Foreign exchange differences
( 7,031)
( 38,217)
-------------
-------------
7. AUDITOR'S REMUNERATION
2023
2022
£
£
Fees payable for the audit of the financial statements
16,000
13,250
---------
---------
Fees payable to the company's auditor and its associates for other services:
Taxation advisory services
10,470
11,600
Other non-audit services
5,917
900
---------
---------
16,387
12,500
---------
---------
8. STAFF COSTS
The average number of persons employed by the company during the year, including the directors, amounted to:
2023
2022
No.
No.
Production staff
182
156
Administrative staff
34
31
----
----
216
187
----
----
The aggregate payroll costs incurred during the year, relating to the above, were:
2023
2022
£
£
Wages and salaries
14,550,677
13,528,947
Social security costs
781,522
631,457
Other pension costs
121,486
116,721
---------------
---------------
15,453,685
14,277,125
---------------
---------------
Aggregate payroll costs above include temporary staff costs of £6,932,022 (2022 - £7,439,154).
9. DIRECTORS' REMUNERATION
The directors' aggregate remuneration in respect of qualifying services was:
2023
2022
£
£
Remuneration
78,682
63,805
---------
---------
10. OTHER INTEREST RECEIVABLE AND SIMILAR INCOME
2023
2022
£
£
Interest on cash and cash equivalents
61,668
6,476
Interest on loan to director
913
---------
-------
62,581
6,476
---------
-------
11. AMOUNTS WRITTEN BACK TO INVESTMENTS
2023
2022
£
£
Amounts written off current asset investments
50
----
----
12. INTEREST PAYABLE AND SIMILAR EXPENSES
2023
2022
£
£
Interest on banks loans and overdrafts
149,703
191,340
Interest on obligations under finance leases and hire purchase contracts
2,766
3,528
----------
----------
152,469
194,868
----------
----------
13. TAX ON PROFIT
Major components of tax expense
2023
2022
£
£
Current tax:
UK current tax expense
2,334,788
1,568,414
Deferred tax:
Origination and reversal of timing differences
336,000
300,000
-------------
-------------
Tax on profit
2,670,788
1,868,414
-------------
-------------
Reconciliation of tax expense
The tax assessed on the profit on ordinary activities for the year is higher than (2022: higher than) the standard rate of corporation tax in the UK of 19 % (2022: 19 %).
2023
2022
£
£
Profit on ordinary activities before taxation
10,909,673
7,633,717
---------------
-------------
Profit on ordinary activities by rate of tax
2,072,838
1,450,406
Effect of expenses not deductible for tax purposes
915,956
628,931
Effect of capital allowances and depreciation
( 318,006)
( 210,923)
---------------
-------------
Tax on profit
2,670,788
1,868,414
---------------
-------------
Factors that may affect future tax expense
Changes to the UK corporation tax rates were substantively enacted as part of the Finance Bill 2021 (on 10 June 2021) including an increase to the main rate to 25% from 1 April 2023.
14. DIVIDENDS
Dividends paid during the year (excluding those for which a liability existed at the end of the prior year):
2023
2022
£
£
Equity dividends on ordinary shares
13,800,000
870,000
---------------
----------
15. TANGIBLE ASSETS
Freehold property
Plant and machinery
Fixtures and fittings
Motor vehicles
Investment property
Total
£
£
£
£
£
£
Cost
At 1 Jul 2022
5,735,512
16,472,598
2,869,021
353,450
554,869
25,985,450
Additions
607,904
5,354,424
170,207
12,548
6,145,083
-------------
--------------
-------------
----------
----------
--------------
At 30 Jun 2023
6,343,416
21,827,022
3,039,228
365,998
554,869
32,130,533
-------------
--------------
-------------
----------
----------
--------------
Depreciation
At 1 Jul 2022
1,261,050
8,339,861
1,941,212
140,837
11,682,960
Charge for the year
276,670
1,519,443
202,752
43,359
2,042,224
-------------
--------------
-------------
----------
----------
--------------
At 30 Jun 2023
1,537,720
9,859,304
2,143,964
184,196
13,725,184
-------------
--------------
-------------
----------
----------
--------------
Carrying amount
At 30 Jun 2023
4,805,696
11,967,718
895,264
181,802
554,869
18,405,349
-------------
--------------
-------------
----------
----------
--------------
At 30 Jun 2022
4,474,462
8,132,737
927,809
212,613
554,869
14,302,490
-------------
--------------
-------------
----------
----------
--------------
The investment property has been included at its purchase price, including stamp duty. The directors consider this to be a reasonable assessment, and not materially different from any fluctuation to the value at the year end. Plant and Machinery includes £4,542,086 (2022 - £1,118,946) of assets which were under construction at the year end. No depreciation has been applied against these assets.
Finance leases and hire purchase contracts
Included within the carrying value of tangible assets are the following amounts relating to assets held under finance leases or hire purchase agreements:
Plant and machinery
£
At 30 June 2023
118,942
----------
At 30 June 2022
988,170
----------
16. INVESTMENTS
Shares in participating interests
£
Cost
At 1 July 2022 and 30 June 2023
50
----
Impairment
At 1 July 2022 and 30 June 2023
----
Carrying amount
At 30 June 2023
50
----
At 30 June 2022
50
----
Investments relate to 50% of share capital held in Volaille Properties Limited, a company registered in England and Wales with a financial year ending 30th June.
To 30 June 2022, Volaille Properties Limited reported a net profit after tax of £117,204 (2021 - £125,380), and capital and reserves of £410,355.
17. STOCKS
2023
2022
£
£
Finished goods and goods for resale
386,615
310,739
Parts stock
1,274,742
1,237,200
-------------
-------------
1,661,357
1,547,939
-------------
-------------
Parts stock held at the year end includes a provision for impairment of £67,092 (2022 - £65,115).
18. DEBTORS
2023
2022
£
£
Trade debtors
14,173,549
13,562,765
Amounts owed by group undertakings
3,606
936,421
Prepayments and accrued income
764,172
780,592
Directors loan account
61,870
Other debtors
3,934,233
7,654,059
---------------
---------------
18,937,430
22,933,837
---------------
---------------
Trade debtors are stated after provisions for impairment of £476,931 (2022 - £233,580).
19. CREDITORS: amounts falling due within one year
2023
2022
£
£
Bank loans
140,741
778,734
Trade creditors
14,910,320
14,447,475
Accruals and deferred income
5,274,584
5,182,311
Corporation tax
1,125,184
1,990,396
Social security and other taxes
191,118
158,125
Obligations under finance leases and hire purchase contracts
11,401
245,186
Other creditors
1,850,326
2,163,355
---------------
---------------
23,503,674
24,965,582
---------------
---------------
Bank loans and overdrafts of £140,741 (2022 - £778,734) are secured by a fixed and floating charge over the assets of the company.
Hire purchase agreements are secured against the assets to which they relate.
20. CREDITORS: amounts falling due after more than one year
2023
2022
£
£
Bank loans
1,708,233
1,829,458
Obligations under finance leases and hire purchase contracts
11,391
-------------
-------------
1,708,233
1,840,849
-------------
-------------
Bank loans and overdrafts of £1,708,233 (2022 - £1,829,458) are secured by a fixed and floating charge over the assets of the company.
Hire purchase agreements are secured against the assets to which they relate.
21. FINANCE LEASES AND HIRE PURCHASE CONTRACTS
The total future minimum lease payments under finance leases and hire purchase contracts are as follows:
2023
2022
£
£
Not later than 1 year
11,401
245,186
Later than 1 year and not later than 5 years
11,391
---------
----------
11,401
256,577
---------
----------
22. PROVISIONS
Deferred tax (note 23)
£
At 1 July 2022
1,544,000
Charge against provision
336,000
-------------
At 30 June 2023
1,880,000
-------------
23. DEFERRED TAX
The deferred tax included in the statement of financial position is as follows:
2023
2022
£
£
Included in provisions (note 22)
1,880,000
1,544,000
-------------
-------------
The deferred tax account consists of the tax effect of timing differences in respect of:
2023
2022
£
£
Accelerated capital allowances
1,880,000
1,544,000
-------------
-------------
24. EMPLOYEE BENEFITS
Defined contribution plans
The amount recognised in profit or loss as an expense in relation to defined contribution plans was £ 120,165 (2022: £ 115,400 ).
25. FINANCIAL INSTRUMENTS
The carrying amount for each category of financial instrument is as follows:
2023
2022
£
£
Financial assets that are debt instruments measured at amortised cost
Trade debtors
14,173,549
13,562,765
---------------
---------------
Financial liabilities measured at amortised cost
Bank loans
1,848,974
2,608,192
Hire purchase agreements
11,401
256,577
Trade creditors
14,910,320
14,447,475
---------------
---------------
16,770,695
17,312,244
---------------
---------------
26. CALLED UP SHARE CAPITAL
Issued, called up and fully paid
2023
2022
No.
£
No.
£
Ordinary shares of £ 1 each
6
6
6
6
----
----
----
----
27. RESERVES
Profit and loss account - This reserve records retained earnings and accumulated losses.
28. ANALYSIS OF CHANGES IN NET DEBT
At 1 Jul 2022
Cash flows
At 30 Jun 2023
£
£
£
Cash at bank and in hand
13,102,964
(7,039,509)
6,063,455
Debt due within one year
(1,023,920)
871,778
(152,142)
Debt due after one year
(1,840,849)
132,616
(1,708,233)
---------------
-------------
-------------
10,238,195
( 6,035,115)
4,203,080
---------------
-------------
-------------
29. OPERATING LEASES
As lessee
The total future minimum lease payments under non-cancellable operating leases are as follows:
2023
2022
£
£
Not later than 1 year
122,086
156,685
Later than 1 year and not later than 5 years
332,334
235,677
----------
----------
454,420
392,362
----------
----------
CHESTERFIELD POULTRY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (continued)
YEAR ENDED 30 JUNE 2023
29. OPERATING LEASES (continued)
As lessor
The total future minimum lease payments receivable under non-cancellable operating leases are as follows:
2023
2022
£
£
Not later than 1 year
77,800
70,000
Later than 1 year and not later than 5 years
140,000
210,000
----------
----------
217,800
280,000
----------
----------
30. DIRECTORS' ADVANCES, CREDITS AND GUARANTEES
During the year there have been advances of £115,957, repayments of £55,000 and interest charged of £913. The balance owed by the director at the year end is £61,870 (2022 - £Nil) by N Iqbal . Bank loans are secured by a fixed and floating charge over all property and assets owned by the company. The directors have also given personal guarantees for £250,000 as well as providing personal property as additional security. The loans are on normal commercial terms and repayable by instalments.
31. RELATED PARTY TRANSACTIONS
Dividends of £Nil (2022 - £392,500) and £Nil (2022 - £392,500) were paid to M F Ahmed and N Iqbal, the directors, respectively. Dividends of £13,800,000 (2022 - £85,000) were paid to Chesterfield Poultry Holdings Limited. Transactions took place with three (2022 - four) related company's during the year. A total of £55,561 (2022 - £3,389,292) of sales, and £3,759,905 (2022 - £2,980,159) of purchases were made to the associates. At the year end, there was an amount of £314,884 (2022 - £1,316,280 - debtor) owed to the companies, which is held within trade and other creditors. The directors are considered to be key management, with no other remuneration being received other than dividends during the current and prior year. No further transactions with related parties were undertaken such as are required to be disclosed under FRS 102.
32. CONTROLLING PARTY
During the current and previous year, the company was controlled by the directors. On 27 April 2022 the share capital of the company was transferred to the parent company, Chesterfield Poultry Holdings Limited, a company registered in England and Wales and controlled by M F Ahmed and N Iqbal.