Company registration number SC003582 (Scotland)
J. & A. MITCHELL AND COMPANY LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JULY 2023
J. & A. MITCHELL AND COMPANY LIMITED
COMPANY INFORMATION
Directors
N Clapperton
P B Lefebvre
I Edward
S A Campbell
A Murray
(Appointed 21 August 2023)
Secretary
S A Campbell
Company number
SC003582
Registered office
Springbank Distillery
Well Close
Campbeltown
Argyll
PA28 6ET
Auditor
MHA MacIntyre Hudson
6 St Colme Street
Edinburgh
EH3 6AD
J. & A. MITCHELL AND COMPANY LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2 - 3
Independent auditor's report
4 - 6
Group statement of comprehensive income
7
Group balance sheet
8
Company balance sheet
9
Group statement of changes in equity
10
Company statement of changes in equity
11
Group statement of cash flows
12
Notes to the financial statements
13 - 26
J. & A. MITCHELL AND COMPANY LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 JULY 2023
- 1 -

The Companies of the Group act as manufacturers of Scotch Malt Whisky and as merchants for bottled whisky overseas and as wholesalers and retailers within the United Kingdom.

Business review

The Group turnover for the year amounted to £17,793,758 an increase of £4,506,387 on last year. The profit before tax for the financial year was £5,951,127, an increase of £1,805,788. 

 

Production levels remain consistent with experienced staffing numbers maintained. The sales teams sold the entire allocated stock of bottled whisky for the year and the sales figures were greatly assisted by the introduction of the ‘Countdown Collection’ in advance of the company’s 200th anniversary coupled with the growing success of the Malts Whisky Festival.

 

It is anticipated that the financial results for the coming year will be similar to those in this report, with the new quarterly allocation system now maintaining adequate levels of stock to assist future cashflows.

 

The increased reserves will allow the company to move forward with plans for the new bottling hall facility which will in turn free up some essential warehousing space.

Principal risks and uncertainties

The major risks facing the group comprise a complete worldwide drop in the popularity of Scotch Whisky and the loss of maturing stock by fire or theft.  The first risk will be mitigated by the maintenance of the Group’s reputation for quality at the top end of the market internationally and the secondly by the Group’s stocks being stored in many separate locations.

Key performance indicators

The indicators considered by the directors in assessing the group’s performance are the ability to fulfil sales target quotas, which are constrained by availability of matured stock, whilst considering the necessity to plan forward for twenty one years and secondly, the requirement to achieve a proper after tax profit margin; 25% is considered to be satisfactory value.

 

For 2024 the aim is to maintain the distillery output and the Group turnover at their current levels whilst taking advantage of any opportunities to increase them.

On behalf of the board

N Clapperton
Director
27 February 2024
J. & A. MITCHELL AND COMPANY LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 JULY 2023
- 2 -

The directors present their annual report and financial statements for the year ended 31 July 2023.

Directors

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

H G Wright
(Deceased 5 August 2023)
N Clapperton
P B Lefebvre
I Edward
S A Campbell
A Murray
(Appointed 21 August 2023)

It is with much sadness that we report Mr Hedley G Wright died on 5 August 2023. Mr Wright was Chairman of J&A Mitchell & Company Limited for over 60 years and dedicated himself to maintaining the quality and traditions that Springbank and Glengyle Distilleries, along with William Cadenhead Limited, are famous for. Neil Clapperton replaces Mr Wright as Chairman.

Results and dividends

The results for the year are set out on page 7.

Ordinary dividends were paid amounting to £132,000.

Auditor

In accordance with the company's articles, a resolution proposing that MHA MacIntyre Hudson be reappointed as auditor of the group will be put at a General Meeting.

Statement of directors' responsibilities

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

 

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

 

 

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the group’s and company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and 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 group and company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

J. & A. MITCHELL AND COMPANY LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2023
- 3 -
Statement of disclosure to auditor

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the auditor of the company is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the auditor of the company is aware of that information.

On behalf of the board
N Clapperton
Director
27 February 2024
J. & A. MITCHELL AND COMPANY LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF J. & A. MITCHELL AND COMPANY LIMITED
- 4 -
Opinion

We have audited the financial statements of J. & A. Mitchell and Company Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 July 2023 which comprise the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the group and parent 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 group's and 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 directors with respect to going concern are described in the relevant sections of this report.

Other information

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

 

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of our audit:

J. & A. MITCHELL AND COMPANY LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF J. & A. MITCHELL AND COMPANY LIMITED
- 5 -
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 their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.

 

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

Responsibilities of directors

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

Auditor's responsibilities for the audit of the financial statements

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

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

We identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and then design and perform audit procedures to respond to those risks, including obtaining audit evidence that is sufficient and appropriate to provide a basis for our opinion.

 

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

J. & A. MITCHELL AND COMPANY LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF J. & A. MITCHELL AND COMPANY LIMITED
- 6 -

As a result of these procedures, we consider the opportunities and incentives that may exist within the company for fraud. In common with all audits under ISAs (UK), we perform specific procedures to respond to the risk of management override and inappropriate income recognition.

 

We also obtain an understanding of the legal and regulatory environment in which the company operates, focusing on those laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements and those which may be fundamental to the company’s ability to operate.

 

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 instances 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 misrepresentation.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

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.

Paul Marshall (Senior Statutory Auditor)
For and on behalf of MHA MacIntyre Hudson
27 February 2024
Chartered Accountants
Statutory Auditor
6 St Colme Street
Edinburgh
EH3 6AD
J. & A. MITCHELL AND COMPANY LIMITED
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 JULY 2023
- 7 -
2023
2022
Notes
£
£
Turnover
3
17,793,758
13,287,371
Cost of sales
(5,835,175)
(4,804,283)
Gross profit
11,958,583
8,483,088
Distribution costs
(407,724)
(341,743)
Administrative expenses
(5,797,486)
(4,241,244)
Other operating income
202,102
244,128
Operating profit
4
5,955,475
4,144,229
Interest receivable and similar income
8
1,035
1,656
Interest payable and similar expenses
9
(5,383)
(546)
Profit before taxation
5,951,127
4,145,339
Taxation
10
(1,266,014)
(834,975)
Profit for the financial year
4,685,113
3,310,364
Total comprehensive income for the year is all attributable to the owners of the parent company.

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

J. & A. MITCHELL AND COMPANY LIMITED
GROUP BALANCE SHEET
AS AT 31 JULY 2023
31 July 2023
- 8 -
2023
2022
Notes
£
£
£
£
Fixed assets
Goodwill
12
390,000
440,000
Tangible assets
13
7,978,869
6,913,680
8,368,869
7,353,680
Current assets
Stocks
16
19,818,340
16,869,695
Debtors
17
1,622,993
2,209,329
Cash at bank and in hand
5,231,795
3,186,112
26,673,128
22,265,136
Creditors: amounts falling due within one year
18
(2,716,766)
(2,036,254)
Net current assets
23,956,362
20,228,882
Total assets less current liabilities
32,325,231
27,582,562
Provisions for liabilities
Deferred tax liability
19
1,325,821
1,136,265
(1,325,821)
(1,136,265)
Net assets
30,999,410
26,446,297
Capital and reserves
Called up share capital
21
12,000
12,000
Share premium account
7,793
7,793
Profit and loss reserves
30,979,617
26,426,504
Total equity
30,999,410
26,446,297

These financial statements have been prepared in accordance with the provisions relating to medium-sized groups.

The financial statements were approved by the board of directors and authorised for issue on 27 February 2024 and are signed on its behalf by:
27 February 2024
N Clapperton
Director
Company registration number SC003582 (Scotland)
J. & A. MITCHELL AND COMPANY LIMITED
COMPANY BALANCE SHEET
AS AT 31 JULY 2023
31 July 2023
- 9 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
13
7,206,531
6,068,978
Investments
14
58,126
58,126
7,264,657
6,127,104
Current assets
Stocks
16
12,955,423
11,092,961
Debtors
17
339,417
620,066
Cash at bank and in hand
4,699,527
2,395,359
17,994,367
14,108,386
Creditors: amounts falling due within one year
18
(10,747,132)
(8,178,512)
Net current assets
7,247,235
5,929,874
Total assets less current liabilities
14,511,892
12,056,978
Provisions for liabilities
Deferred tax liability
19
1,061,052
880,010
(1,061,052)
(880,010)
Net assets
13,450,840
11,176,968
Capital and reserves
Called up share capital
21
12,000
12,000
Profit and loss reserves
13,438,840
11,164,968
Total equity
13,450,840
11,176,968

As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £2,405,872 (2022 - £1,922,535 profit).

The financial statements were approved by the board of directors and authorised for issue on 27 February 2024 and are signed on its behalf by:
27 February 2024
N Clapperton
Director
Company registration number SC003582 (Scotland)
J. & A. MITCHELL AND COMPANY LIMITED
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 JULY 2023
- 10 -
Share capital
Share premium account
Profit and loss reserves
Total
Notes
£
£
£
£
Balance at 1 August 2021
12,000
7,793
23,236,140
23,255,933
Year ended 31 July 2022:
Profit and total comprehensive income
-
-
3,310,364
3,310,364
Dividends
11
-
-
(120,000)
(120,000)
Balance at 31 July 2022
12,000
7,793
26,426,504
26,446,297
Year ended 31 July 2023:
Profit and total comprehensive income
-
-
4,685,113
4,685,113
Dividends
11
-
-
(132,000)
(132,000)
Balance at 31 July 2023
12,000
7,793
30,979,617
30,999,410
J. & A. MITCHELL AND COMPANY LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 JULY 2023
- 11 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 August 2021
12,000
9,362,433
9,374,433
Year ended 31 July 2022:
Profit and total comprehensive income for the year
-
1,922,535
1,922,535
Dividends
11
-
(120,000)
(120,000)
Balance at 31 July 2022
12,000
11,164,968
11,176,968
Year ended 31 July 2023:
Profit and total comprehensive income
-
2,405,872
2,405,872
Dividends
11
-
(132,000)
(132,000)
Balance at 31 July 2023
12,000
13,438,840
13,450,840
J. & A. MITCHELL AND COMPANY LIMITED
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 JULY 2023
- 12 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
27
4,833,922
3,316,102
Interest paid
(5,383)
(546)
Income taxes paid
(880,549)
(374,953)
Net cash inflow from operating activities
3,947,990
2,940,603
Investing activities
Purchase of intangible assets
-
(200,000)
Purchase of tangible fixed assets
(1,771,342)
(978,805)
Interest received
1,035
1,656
Net cash used in investing activities
(1,770,307)
(1,177,149)
Financing activities
Dividends paid to equity shareholders
(132,000)
(120,000)
Net cash used in financing activities
(132,000)
(120,000)
Net increase in cash and cash equivalents
2,045,683
1,643,454
Cash and cash equivalents at beginning of year
3,186,112
1,542,658
Cash and cash equivalents at end of year
5,231,795
3,186,112
J. & A. MITCHELL AND COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JULY 2023
- 13 -
1
Accounting policies
Company information

J. & A. Mitchell and Company Limited (“the company”) is a limited company domiciled and incorporated in Scotland. The registered office is Springbank Distillery, Well Close, Campbeltown, Argyll, PA28 6ET.

 

The group consists of J. & A. Mitchell and Company Limited and all of its subsidiaries.

1.1
Accounting convention

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

The company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements for parent company information presented within the consolidated financial statements:

 

The consolidated financial statements incorporate those of J. & A. Mitchell and Company Limited and all of its subsidiaries (ie entities that the group controls through its power to govern the financial and operating policies so as to obtain economic benefits).

 

All financial statements are made up to 31 July 2023. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.

 

All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.

J. & A. MITCHELL AND COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2023
1
Accounting policies
(Continued)
- 14 -
1.2
Going concern

At the time of approving the financial statements, the directors have a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

1.3
Turnover

Turnover is attributable to the manufacture, distillation and maturing in bonded warehouses of malt whisky.

 

Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.

1.4
Intangible fixed assets - goodwill

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

 

For the purposes of impairment testing, goodwill is allocated to the cash-generating units expected to benefit from the acquisition. Cash-generating units to which goodwill has been allocated are tested for impairment at least annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit.

1.5
Tangible fixed assets

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Heritable property
2.5% straight line
Plant and machinery
10% straight line
Fixtures and fittings
20% straight line
Office equipment
33% straight line
Motor vehicles
25% straight line

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

The carrying value of tangible fixed assets are reviewed for impairment when events or changes in circumstances indicate the carrying value may not be recoverable.

J. & A. MITCHELL AND COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2023
1
Accounting policies
(Continued)
- 15 -
1.6
Fixed asset investments

In the parent company financial statements, investments in subsidiaries are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.

A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

1.7
Stocks

Work in progress consists of maturing malt whisky and stock consists of cased goods ready for sale. Stocks and work in progress are valued at the lower of cost and net realisable value after making due allowance for obsolete and slow-moving stocks. Cost includes all direct costs and an appropriate proportion of fixed and variable overheads.

1.8
Cash at bank and in hand

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

1.9
Financial instruments

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

 

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

 

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

Debtors

Debtors with no stated interest rate or are receivable within one year are measured at transaction price. Any losses arising from impairment are recognised in the income statement within other operating expenses.

Creditors

Creditors with no stated interest rate and payable within one year are recorded at transaction price.

1.10
Equity instruments

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

1.11
Taxation

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

Current tax

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

J. & A. MITCHELL AND COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2023
1
Accounting policies
(Continued)
- 16 -
Deferred tax

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

 

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

1.12
Employee benefits

The costs of short-term employee benefits are recognised as a liability and an expense.

 

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

 

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

1.13
Retirement benefits

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

1.14
Leases

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

1.15
Government grants

Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.

 

A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.

1.16
Foreign exchange

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

J. & A. MITCHELL AND COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2023
- 17 -
2
Judgements and key sources of estimation uncertainty

In the application of the group’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

 

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

Key sources of estimation uncertainty

The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.

Useful life of tangible assets

The company sets depreciation rates which reasonably reflect the probably economic life of an asset. The directors regularly review the policies for appropriateness. The directors also review of impairment when trigger events occur or annual as appropriate.

3
Turnover and other revenue
Turnover analysed by geographical market
2023
2022
£
£
United Kingdom
9,928,803
6,123,188
European Union
3,322,311
3,509,606
Rest of World
4,542,644
3,654,577
17,793,758
13,287,371
4
Operating profit
2023
2022
£
£
Operating profit for the year is stated after charging/(crediting):
Government grants
-
(26,460)
Depreciation of owned tangible fixed assets
706,153
590,055
Amortisation of intangible assets
50,000
40,000
Operating lease charges
21,795
61,285

Operating profit is stated after crediting other income of £nil (2022 - £26,460) for grant income in relation to the Coronavirus Job Retention Scheme.

J. & A. MITCHELL AND COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2023
- 18 -
5
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the group and company
11,080
9,910
Audit of the financial statements of the company's subsidiaries
23,760
21,600
34,840
31,510
For other services
Taxation compliance services
6,380
5,800
6
Employees

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

2023
2022
Number
Number
100
87

Their aggregate remuneration comprised:

2023
2022
£
£
Wages and salaries
3,988,847
3,197,488
Social security costs
372,622
354,773
Pension costs
143,044
127,248
4,504,513
3,679,509
7
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
674,219
588,752
Company pension contributions to defined contribution schemes
5,370
7,650
679,589
596,402
J. & A. MITCHELL AND COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2023
7
Directors' remuneration
(Continued)
- 19 -
Remuneration disclosed above includes the following amounts paid to the highest paid director:
2023
2022
£
£
Remuneration for qualifying services
283,514
277,784
8
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
509
30
Other interest income
526
1,626
Total income
1,035
1,656
9
Interest payable and similar expenses
2023
2022
£
£
Interest on bank overdrafts and loans
1,366
-
Other finance costs:
Other interest
4,017
546
Total finance costs
5,383
546
10
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
1,116,000
725,030
Adjustments in respect of prior periods
(39,542)
(20,876)
Total current tax
1,076,458
704,154
Deferred tax
Origination and reversal of timing differences
189,556
130,821
Total tax charge
1,266,014
834,975
J. & A. MITCHELL AND COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2023
10
Taxation
(Continued)
- 20 -

The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:

2023
2022
£
£
Profit before taxation
5,951,127
4,145,339
Expected tax charge based on the standard rate of corporation tax in the UK of 21.00% (2022: 19.00%)
1,249,737
787,614
Tax effect of expenses that are not deductible in determining taxable profit
21,691
11,081
Tax effect of income not taxable in determining taxable profit
-
0
(17,813)
Adjustments in respect of prior years
(39,542)
(20,876)
Depreciation on assets not qualifying for tax allowances
79,096
29,956
Other tax adjustments
12,095
13,553
Remeasurement of deferred tax for changes in tax rates
(57,063)
31,460
Tax expense for the year
1,266,014
834,975
11
Dividends
2023
2022
Recognised as distributions to equity holders:
£
£
Interim paid
132,000
120,000
12
Intangible fixed assets
Group
Goodwill
£
Cost
At 1 August 2022 and 31 July 2023
500,000
Amortisation and impairment
At 1 August 2022
60,000
Amortisation charged for the year
50,000
At 31 July 2023
110,000
Carrying amount
At 31 July 2023
390,000
At 31 July 2022
440,000

The goodwill was acquired as part of the acquisition of Cadenhead's Whisky Shop, Edinburgh on 23 December 2020 and Cadenhead Whisky Shop & Tasting Room, London, on 7 December 2021. Goodwill is amortised on a straight line basis over its estimated useful life of 10 years.

J. & A. MITCHELL AND COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2023
12
Intangible fixed assets
(Continued)
- 21 -
The company had no intangible fixed assets at 31 July 2023 or 31 July 2022.
13
Tangible fixed assets
Group
Heritable property
Plant and machinery
Fixtures and fittings
Office equipment
Motor vehicles
Total
£
£
£
£
£
£
Cost
At 1 August 2022
3,647,815
7,190,686
217,057
7,741
38,210
11,101,509
Additions
827,857
943,485
-
0
-
0
-
0
1,771,342
Disposals
-
0
-
0
(3,767)
(2,170)
-
0
(5,937)
At 31 July 2023
4,475,672
8,134,171
213,290
5,571
38,210
12,866,914
Depreciation and impairment
At 1 August 2022
359,227
3,671,782
121,770
7,740
27,310
4,187,829
Depreciation charged in the year
43,660
630,879
28,886
-
0
2,728
706,153
Eliminated in respect of disposals
-
0
-
0
(3,767)
(2,170)
-
0
(5,937)
At 31 July 2023
402,887
4,302,661
146,889
5,570
30,038
4,888,045
Carrying amount
At 31 July 2023
4,072,785
3,831,510
66,401
1
8,172
7,978,869
At 31 July 2022
3,288,588
3,518,904
95,287
1
10,900
6,913,680
Company
Heritable property
Plant and machinery
Fixtures and fittings
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 August 2022
3,547,815
6,061,986
147,508
38,210
9,795,519
Additions
827,857
891,436
-
0
-
0
1,719,293
At 31 July 2023
4,375,672
6,953,422
147,508
38,210
11,514,812
Depreciation and impairment
At 1 August 2022
344,227
3,250,120
104,884
27,310
3,726,541
Depreciation charged in the year
41,160
521,309
16,543
2,728
581,740
At 31 July 2023
385,387
3,771,429
121,427
30,038
4,308,281
Carrying amount
At 31 July 2023
3,990,285
3,181,993
26,081
8,172
7,206,531
At 31 July 2022
3,203,588
2,811,866
42,624
10,900
6,068,978
J. & A. MITCHELL AND COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2023
- 22 -
14
Fixed asset investments
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Investments in subsidiaries
15
-
0
-
0
58,126
58,126
Movements in fixed asset investments
Company
Shares in subsidiaries
£
Cost or valuation
At 1 August 2022 and 31 July 2023
58,126
Carrying amount
At 31 July 2023
58,126
At 31 July 2022
58,126
15
Subsidiaries

Details of the company's subsidiaries at 31 July 2023 are as follows:

Name of undertaking
Address
Nature of business
Class of
% Held
shares held
Direct
Mitchell's Glengyle Limited
1
Whisky manufacturer and retailer of alcoholic drinks
Ordinary
99
Springbank Distillers Limited
2
Whisky manufacturer and retailer of alcoholic drinks
Ordinary
99
William Cadenhead Limited
2
Wine and spirit merchant
Ordinary
99
Cadenhead Retail Limited
2
Wine and spirit merchant
Ordinary
99

Registered office addresses (all UK unless otherwise indicated):

1
Springbank Distillery, Well Close, Campbeltown, Argyll, PA28 6ET
2
9 Bolgam Street, Campbeltown, Argyll, PA28 6HZ
16
Stocks
Group
Company
2023
2022
2023
2022
£
£
£
£
Raw materials and consumables
810,688
567,825
624,440
355,238
Work in progress
17,739,834
14,808,189
11,599,758
9,962,252
Finished goods and goods for resale
1,267,818
1,493,681
731,225
775,471
19,818,340
16,869,695
12,955,423
11,092,961
J. & A. MITCHELL AND COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2023
- 23 -
17
Debtors
Group
Company
2023
2022
2023
2022
Amounts falling due within one year:
£
£
£
£
Trade debtors
1,080,749
1,867,357
4,771
62,746
Corporation tax recoverable
144,000
65,000
-
0
-
0
Amounts owed by group undertakings
-
-
-
342,193
Other debtors
329,547
219,624
279,741
167,709
Prepayments and accrued income
68,697
57,348
54,905
47,418
1,622,993
2,209,329
339,417
620,066
18
Creditors: amounts falling due within one year
Group
Company
2023
2022
2023
2022
£
£
£
£
Trade creditors
197,495
503,750
85,003
421,116
Amounts owed to group undertakings
-
0
-
0
9,431,540
6,976,071
Corporation tax payable
814,789
539,880
388,795
265,916
Other taxation and social security
835,751
510,651
132,176
96,469
Other creditors
224,088
196,177
196,562
193,806
Accruals and deferred income
644,643
285,796
513,056
225,134
2,716,766
2,036,254
10,747,132
8,178,512
19
Deferred taxation

Deferred tax assets and liabilities are offset where the group or company has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:

Liabilities
Liabilities
2023
2022
Group
£
£
Accelerated capital allowances
1,325,821
1,136,265
Liabilities
Liabilities
2023
2022
Company
£
£
Accelerated capital allowances
1,061,052
880,010
J. & A. MITCHELL AND COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2023
19
Deferred taxation
(Continued)
- 24 -
Group
Company
2023
2023
Movements in the year:
£
£
Liability at 1 August 2022
1,136,265
880,010
Charge to profit or loss
189,556
181,042
Liability at 31 July 2023
1,325,821
1,061,052
20
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
143,044
127,248

A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.

21
Share capital
Group and company
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
12,000
12,000
12,000
12,000
22
Financial commitments, guarantees and contingent liabilities

Clydesdale Bank Plc holds a cross guarantee and floating charge over the entire assets of the group.

23
Operating lease commitments
Lessee

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

Group
Company
2023
2022
2023
2022
£
£
£
£
Within one year
13,881
4,567
4,922
4,567
Between two and five years
20,034
17,228
11,075
17,228
33,915
21,795
15,997
21,795
J. & A. MITCHELL AND COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2023
- 25 -
24
Capital commitments

Amounts contracted for but not provided in the financial statements:

Group
Company
2023
2022
2023
2022
£
£
£
£
Acquisition of tangible fixed assets
-
72,028
-
72,028
25
Purchase commitments

The group is committed to purchasing stock amounts of £296,608 (2022: £361,088) within 1 year, £1,152,580 (2022: £1,326,676) in 2 to 5 years and £2,006,940 (2022: £2,380,884) in over 5 years.

26
Related party transactions
Transactions with related parties

During the year the group entered into the following transactions with related parties:

Sales
Sales
Purchases
Purchases
2023
2022
2023
2022
£
£
£
£
Group
Companies associated by common directors
21,016
22,108
403,668
433,272
Directors
42,937
47,061
74,819
219,275
Company
Directors
39,299
43,240
-
-
Other related parties
20,545
25,929
326,162
271,069

The following amounts were outstanding at the reporting end date:

Amounts due to related parties
2023
2022
£
£
Group
Directors
742
1,293
Company
Directors
742
1,293
J. & A. MITCHELL AND COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2023
- 26 -
27
Cash generated from group operations
2023
2022
£
£
Profit for the year after tax
4,685,113
3,310,364
Adjustments for:
Taxation charged
1,266,014
834,975
Finance costs
5,383
546
Investment income
(1,035)
(1,656)
Amortisation and impairment of intangible assets
50,000
40,000
Depreciation and impairment of tangible fixed assets
706,153
590,055
Movements in working capital:
Increase in stocks
(2,948,645)
(1,156,129)
Decrease/(increase) in debtors
665,336
(718,390)
Increase in creditors
405,603
416,337
Cash generated from operations
4,833,922
3,316,102
28
Analysis of changes in net debt - group
2023
£
Opening net funds
Cash and cash equivalents
3,186,112
Changes in net debt arising from:
Cash flows of the entity
2,045,683
Closing net funds as analysed below
5,231,795
Closing net funds
Cash and cash equivalents
5,231,795
2023-07-312022-08-01falseCCH SoftwareCCH Accounts Production 2023.300No description of principal activityH G WrightN ClappertonP B LefebvreI EdwardA MurrayA MurrayS A CampbellfalseSC003582bus:Consolidated2022-08-012023-07-31SC0035822022-08-012023-07-31SC003582bus:Director22022-08-012023-07-31SC003582bus:Director32022-08-012023-07-31SC003582bus:Director42022-08-012023-07-31SC003582bus:CompanySecretaryDirector12022-08-012023-07-31SC003582bus:Director52022-08-012023-07-31SC003582bus:CompanySecretary12022-08-012023-07-31SC003582bus:Director12022-08-012023-07-31SC003582bus:Director62022-08-012023-07-31SC003582bus:RegisteredOffice2022-08-012023-07-31SC0035822023-07-31SC003582bus:Consolidated2021-08-012022-07-31SC0035822021-08-012022-07-31SC003582bus:Consolidated2023-07-31SC003582core:Goodwillbus:Consolidated2023-07-31SC003582core:Goodwillbus:Consolidated2022-07-31SC003582bus:Consolidated2022-07-31SC0035822022-07-31SC003582core:LandBuildingscore:OwnedOrFreeholdAssetsbus:Consolidated2023-07-31SC003582core:PlantMachinerybus:Consolidated2023-07-31SC003582core:FurnitureFittingsbus:Consolidated2023-07-31SC003582core:ComputerEquipmentbus:Consolidated2023-07-31SC003582core:MotorVehiclesbus:Consolidated2023-07-31SC003582core:LandBuildingscore:OwnedOrFreeholdAssetsbus:Consolidated2022-07-31SC003582core:PlantMachinerybus:Consolidated2022-07-31SC003582core:FurnitureFittingsbus:Consolidated2022-07-31SC003582core:ComputerEquipmentbus:Consolidated2022-07-31SC003582core:MotorVehiclesbus:Consolidated2022-07-31SC003582core:LandBuildingscore:OwnedOrFreeholdAssets2023-07-31SC003582core:PlantMachinery2023-07-31SC003582core:FurnitureFittings2023-07-31SC003582core:MotorVehicles2023-07-31SC003582core:LandBuildingscore:OwnedOrFreeholdAssets2022-07-31SC003582core:PlantMachinery2022-07-31SC003582core:FurnitureFittings2022-07-31SC003582core:MotorVehicles2022-07-31SC003582core:ShareCapitalbus:Consolidated2023-07-31SC003582core:ShareCapitalbus:Consolidated2022-07-31SC003582core:SharePremiumbus:Consolidated2023-07-31SC003582core:SharePremiumbus:Consolidated2022-07-31SC003582core:ShareCapital2023-07-31SC003582core:ShareCapital2022-07-31SC003582core:RetainedEarningsAccumulatedLosses2023-07-31SC003582core:ShareCapitalbus:Consolidated2021-07-31SC003582core:SharePremiumbus:Consolidated2021-07-31SC003582core:RetainedEarningsAccumulatedLossesbus:Consolidated2021-07-31SC003582core:RetainedEarningsAccumulatedLossesbus:Consolidated2022-07-31SC003582core:RetainedEarningsAccumulatedLossesbus:Consolidated2023-07-31SC003582core:ShareCapital2021-07-31SC003582core:RetainedEarningsAccumulatedLosses2021-07-31SC003582core:RetainedEarningsAccumulatedLosses2022-07-31SC003582bus:Consolidated2021-07-31SC003582core:Goodwill2022-08-012023-07-31SC003582core:LandBuildingscore:OwnedOrFreeholdAssets2022-08-012023-07-31SC003582core:PlantMachinery2022-08-012023-07-31SC003582core:FurnitureFittings2022-08-012023-07-31SC003582core:ComputerEquipment2022-08-012023-07-31SC003582core:MotorVehicles2022-08-012023-07-31SC003582core:UKTaxbus:Consolidated2022-08-012023-07-31SC003582core:UKTaxbus:Consolidated2021-08-012022-07-31SC003582bus:Consolidated12022-08-012023-07-31SC003582bus:Consolidated12021-08-012022-07-31SC003582bus:Consolidated22022-08-012023-07-31SC003582bus:Consolidated22021-08-012022-07-31SC003582core:Goodwillbus:Consolidated2022-07-31SC003582core:Goodwillbus:Consolidated2022-08-012023-07-31SC003582core:LandBuildingscore:OwnedOrFreeholdAssetsbus:Consolidated2022-07-31SC003582core:PlantMachinerybus:Consolidated2022-07-31SC003582core:FurnitureFittingsbus:Consolidated2022-07-31SC003582core:ComputerEquipmentbus:Consolidated2022-07-31SC003582core:MotorVehiclesbus:Consolidated2022-07-31SC003582bus:Consolidated2022-07-31SC003582core:LandBuildingscore:OwnedOrFreeholdAssets2022-07-31SC003582core:PlantMachinery2022-07-31SC003582core:FurnitureFittings2022-07-31SC003582core:MotorVehicles2022-07-31SC0035822022-07-31SC003582core:LandBuildingscore:OwnedOrFreeholdAssetsbus:Consolidated2022-08-012023-07-31SC003582core:PlantMachinerybus:Consolidated2022-08-012023-07-31SC003582core:FurnitureFittingsbus:Consolidated2022-08-012023-07-31SC003582core:ComputerEquipmentbus:Consolidated2022-08-012023-07-31SC003582core:MotorVehiclesbus:Consolidated2022-08-012023-07-31SC003582core:CurrentFinancialInstruments2023-07-31SC003582core:CurrentFinancialInstruments2022-07-31SC003582core:CurrentFinancialInstrumentsbus:Consolidated2023-07-31SC003582core:CurrentFinancialInstrumentsbus:Consolidated2022-07-31SC003582core:CurrentFinancialInstrumentscore:WithinOneYearbus:Consolidated2023-07-31SC003582core:CurrentFinancialInstrumentscore:WithinOneYearbus:Consolidated2022-07-31SC003582core:CurrentFinancialInstrumentscore:WithinOneYear2023-07-31SC003582core:CurrentFinancialInstrumentscore:WithinOneYear2022-07-31SC003582bus:PrivateLimitedCompanyLtd2022-08-012023-07-31SC003582bus:FRS1022022-08-012023-07-31SC003582bus:Audited2022-08-012023-07-31SC003582bus:ConsolidatedGroupCompanyAccounts2022-08-012023-07-31SC003582bus:FullAccounts2022-08-012023-07-31xbrli:purexbrli:sharesiso4217:GBP