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REGISTERED NUMBER: 07186552 (England and Wales)



















STRATEGIC REPORT, REPORT OF THE DIRECTORS AND

FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2023

FOR

TILLOTTS PHARMA UK LIMITED

TILLOTTS PHARMA UK LIMITED (REGISTERED NUMBER: 07186552)






CONTENTS OF THE FINANCIAL STATEMENTS
for the Year Ended 31 DECEMBER 2023




Page

Company Information 1

Strategic Report 2

Report of the Directors 5

Report of the Independent Auditors 8

Statement of Comprehensive Income 11

Balance Sheet 12

Statement of Changes in Equity 13

Cash Flow Statement 14

Notes to the Cash Flow Statement 15

Notes to the Financial Statements 16


TILLOTTS PHARMA UK LIMITED

COMPANY INFORMATION
for the Year Ended 31 DECEMBER 2023







DIRECTORS: Mr J Thorpe
Dr B Lange
Mr M P Portmann





SECRETARY: Ms L Robinson





REGISTERED OFFICE: Larbourne Suite
The Stables
Wellingore Hall
Wellingore
Lincolnshire
LN5 0HX





REGISTERED NUMBER: 07186552 (England and Wales)





AUDITORS: FKCA Limited
Statutory Auditor
260 - 270 Butterfield
Great Marlings
Luton
Bedfordshire
LU2 8DL

TILLOTTS PHARMA UK LIMITED (REGISTERED NUMBER: 07186552)

STRATEGIC REPORT
for the Year Ended 31 DECEMBER 2023

The directors present their strategic report for the year ended 31 December 2023.

REVIEW OF BUSINESS
Key performance indicators
Key performance indicators used to monitor and measure the effectiveness and productivity of the company include:

Financial performance
- 2023 was the eleventh consecutive year that Tillotts Pharma UK achieved double digit growth in sales revenue. Sales income in 2023 exceeded £57.8 million, before rebates, representing 20% growth over the previous year and 112% of original budget. The growth is partly due to an increase in sales volume and also partly due to achieving higher ex-factory prices following a reduction in the rate of wholesaler discount.
- Cost of Sales significantly increased in 2023 as a result of the Prescription Price Regulatory Scheme (PPRS) Voluntary scheme (VPAS) rate of rebate which increased from 15% in 2021 to 26.5% in 2023, the magnitude of the increase was foreseen in mid 2022 which enabled mitigatory actions to be implemented, the effect of these mitigations was to reduce the effective rate of rebate from 26.5% to 20%. Forecasts indicate that this rebate will increase to between 22% and 40% from 2024 under the terms of the new Voluntary Pricing and Access scheme, further mitigations are necessary.
- The cost of the VPAS rebate after mitigations came in at £11.2 million.
- Operating expenses were £20.3 million which was £3.3 million above budget and entirely to the increase in VPAS rebate, there were no other material variances from budget.
- There were no bad debts in 2023.
- Cash-flow in 2023 was robust with intercompany loans repaid and reserves made.

Sales performance
- Sales of Octasa in 2023 were aligned with forecast and original budget.
- Sales of Octasa 800 generated revenue of £28.2 million which is 50% of total sales income. Sales of Octasa 800 achieved 101% of sales budget. The Octasa brand is the market leading mesalazine in the UK with a cash market share of 38%.
- At £1.8 million Entocort sales accounted for 3% of sales revenue, the fall in revenue is due to generic competition and a reduced price per pack. Tillotts UK received a marketing authorisation for an unbranded budesonide, our own generic version of Entocort, in late 2022 this is now established in the market. The first consignment of stock arrived in April 2023. Unbranded budesonide mitigates the risk of losing the entire market to a generic competitor and reduces the cost of sale by avoiding VPAS and having reduced marketing costs.
- Dificlir was debranded to fidaxomicin as a mitigation to avoid VPAS, removing the brand name has not effected sales, sales performance throughout for fidaxomicin through 2023 was above target, fidaxomicin exceeded £13.6 million in sales revenue and growth of 25% in 2023.

Supply performance
- The lingering after-effects of the pandemic and continuing uncertainties at the manufacturing site caused supply chain during challenges in 2023, however continuity of supply of all pack sizes and strengths of all medications was maintained throughout 2023.
- In 2023 Tillotts UK changed our wholesale arrangements, entering into a single wholesaler agreement with Alliance Healthcare on 1st February 2023. This reduced the supplier discounts significantly and improved our capability for cash flow forecasting.

Financial position at the reporting date
Net assets have increased from £7.6 million to £8.8 million reflecting the profit recognised in the year.

FUTURE OUTLOOK
Trading conditions are bleak, the toughest for decades and made more so by the 2024 Voluntary Scheme for Branded Medicines Pricing and Access (PPRS) levy. High rates of inflation have increased prices from service providers and have increased manufacturing costs, government policy through VPAS has dramatically increased the cost of sale, and NHS environment does not permit price increases.

Changing the supply model in 2023 to a single wholesaler agreement cut distribution costs significantly, and a new supply equilibrium without loss of volume has been achieved in the wholesale market.

TILLOTTS PHARMA UK LIMITED (REGISTERED NUMBER: 07186552)

STRATEGIC REPORT
for the Year Ended 31 DECEMBER 2023


FUTURE OUTLOOK (continued)
In 2024 the rate of growth of market share for Octasa 400mg and 800mg sales will reduce as the brands achieve full potential with no further range extensions planned in the year. No generic versions of mesalazine are expected on the market in 2024.

Entrance to the supply chain of a generic oral budesonide capsule has detrimentally commoditise this sector of the market halving the price per pack obtained.

There are new molecules available in the market in 2024, these are indicated for moderate to severe patients and are higher in price than the existing treatment options. There is an increase in the number of bio-similar agents available and these are no longer considered high cost drugs by the NHS, the effect of these new entrants is to encourage earlier prescribing of these bio-similar agents. We expect to see the first bio-similar versions of ustekinumab available in the UK in the first quarter of 2024 which will also encourage earlier use of biologic agents.

PRINCIPAL RISKS AND UNCERTAINTIES
Management continually monitor the key risks facing the company together with assessing the controls used for managing these risks. The board of directors formally reviews and documents the principal risks facing the business at least annually. The principal risks and uncertainties facing the company are as follows:
- VPAG: The new 2024 scheme that came into effect from 1 January 2024 has a duration of five years and the rates of rebate required for medicines with active ingredients that have had a marketing authorisation for 12 years or more is too high too high to be sustained therefore Tillotts UK has left the voluntary scheme and is now by default in the Statutory scheme.
- Supply chain uncertainties remain a profoundly serious threat to the growth of business in 2024.
- The risk of new parallel import of Octasa has increased with the change to the single wholesaler model.
- Loss of Key personnel: Unaffordable wage expectations, the cost-of-living crisis has increased sensitivity about wage levels, Tillotts Pharma UK has key personnel who are at heightened risk of loss, recruiters have targeted Tillotts when scouting for talent, loss of key personnel due to salary pressure is a significant threat.
- Due to high inflation increased costs have driven up daily rates of service providing agencies.
- Adverse economic pressures are likely to increase the risk of loss of key service providing agencies.

SECTION 172(1) STATEMENT
The board of directors have always acted in the way they consider, in good faith, would be most likely to promote the success of the group for the benefit of its members as a whole, having regard to the stakeholders and matters set out in s172(1) (a) - (f) of the Companies Act 2006, in the decisions taken during the year ended 31 December 2023.

Human Resources and key Personnel
Key personnel are identified as critical for the future performance of the business, functional developmental and professional training has been offered to these key personnel. A graduate recruitment programme has been running for several years, with several employees that joined the organization through this scheme now in managerial roles and sharing their experience in the wider local economy through local government engagement schemes.

Tillotts Pharma UK duty of care toward employees was extended in 2023 through an employee support programme including long-term financial planning, health (including mental health) awareness initiatives and flexibility for employees to work from home In 2024 a new employee benefit of Heath Screening is being made available for all staff with 5 years' service or more.

In 2023 all line managers had retention and development of staff as key performance indicators.

Governance and Social Responsibility
Tillotts Pharma UK are an active member of the business economy in Lincolnshire and within the health care community nationally. Tillotts support the Lincolnshire Enterprise partnership, providing input to education and employment forums locally. Tillotts are active members of the trade body Ethical Medicines Industry Group (EMIG) and represented the industry in discussions with the Department of Health and other governmental organisations.

TILLOTTS PHARMA UK LIMITED (REGISTERED NUMBER: 07186552)

STRATEGIC REPORT
for the Year Ended 31 DECEMBER 2023


SECTION 172(1) STATEMENT (continued)
Charitable activity
During 2023 Tillotts sold obsolete communications equipment donating the proceeds to charitable organisations involved in the care of patients with IBD and donated similar equipment to patient organisations for the benefit of patients.

ENGAGEMENT WITH SUPPLIERS, CUSTOMERS AND OTHERS
The company aims to have positive and strong business relationships with key stakeholders, such as customers and suppliers, to ensure long term sustainable value. The director and management teams deal directly with the engagement of the customers and suppliers in relation to the business.

ON BEHALF OF THE BOARD:





Mr J Thorpe - Director


18 March 2024

TILLOTTS PHARMA UK LIMITED (REGISTERED NUMBER: 07186552)

REPORT OF THE DIRECTORS
for the Year Ended 31 DECEMBER 2023

The directors present their report with the financial statements of the company for the year ended 31 December 2023.

PRINCIPAL ACTIVITY
The principal activity of the company in the year under review was that of the promotion and sale of the group's products to healthcare professionals working in the gastro-intestinal field, to NHS procurement agencies, and NHS commissioning bodies.

DIVIDENDS
No dividends will be distributed for the year ended 31 December 2023.

DIRECTORS
The directors shown below have held office during the whole of the period from 1 January 2023 to the date of this report.

Mr J Thorpe
Dr B Lange
Mr M P Portmann

FINANCIAL INSTRUMENTS
Treasury operations and financial instruments
The company's principal financial instruments include cash balances and borrowings from the parent company, the main purpose of which are to provide working capital for the company's operations. In addition, the company has various other financial assets and liabilities such as trade receivables and trade payables arising directly from its operations.

Liquidity Risk
The company manages its cash and borrowing requirements in order to ensure that the company has sufficient liquid resources to meet the operating needs of its business.

Interest Rate Risk
The company is exposed to cash flow interest rate risk on its floating rate deposit and fixed rate borrowing from the parent company. The company regularly monitors both the sums on deposit and those due to the parent company in order to minimise the risk.

Foreign Currency Risk
The company's principal foreign currency exposures arise from trading operations in overseas countries. The company does not believe this risk requires active management due to the small sums involved.

Price and Credit Risk
The company sets its prices in accordance with the prevailing economic and market conditions. The NHS uses rebates to control the NHS spend on branded medicines and operates price controls on established medicines therefore it is not possible to get an increase in the price of any medicine already on the market. The company participated in the 2019 Voluntary Scheme for Branded Medicines Pricing and Access, the new VPAG scheme which became effective on 1st January 2024 will result in levies in excess of 30% for medicines with active pharmaceutical ingredients that have been on the market for 12 years or more, there are no advantages for TP UK in this scheme as such TP UK has by default left the VPAG scheme and is now in the Statutory Scheme. The rebate charged in statutory scheme does not increase with time on the market and may be marginally lower. Mitigations to offset the cost of the statutory scheme are being sought.

Credit terms are strictly controlled and sums due are collected in accordance with their terms. Credit risk assessments are conducted for all new customers and credit risk insurance has been considered but not taken.

STREAMLINED ENERGY AND CARBON REPORTING
As part of the new streamlined energy and carbon reporting (SECR) framework the company is committed to adhering to the new regulatory guidance on reducing GHG emission levels. Trend analysis will develop in future years to allow benchmarking against similar sized businesses within the industry.






TILLOTTS PHARMA UK LIMITED (REGISTERED NUMBER: 07186552)

REPORT OF THE DIRECTORS
for the Year Ended 31 DECEMBER 2023

STREAMLINED ENERGY AND CARBON REPORTING (continued)
The quantity of emissions of carbon dioxide (Co2) equivalent resulting from the company's activities during the year ended 31 December 2023 are:

2023 2023 2022 2022
tCO2e kWh tCO2e kWh
Direct emissions 1 7,042 - -
Indirect emissions 3 16,379 - -
Other indirect emissions 186 529,119 66 275,231*
Total gross CO 2e based on above 191 552,540 66 275,231
Total kWh per pack sold 0.48 0.24

* Limited data available for 2022 reporting.

The carbon accounting and reporting approach used follows the 2019 HM Government Environmental Reporting Guidelines, including the GHG Reporting Protocol - Corporate Standard and the 2022 UK Government's Conversion Factors for company reporting.

Our emissions inventory includes all Scope 1 and 2 emissions as well as the categories "upstream transportation and distribution", "waste generated in operations", "business travel" and "employee commuting" in Scope 3. The "downstream transportation and distribution" category could not be analysed due to a lack of data. We will work together with our customers to improve the data situation and data collection regarding CO2e emissions in order to be able to report on this category in future. Nevertheless, estimations show that this category is not a material driver of our carbon footprint.

To achieve our group-wide net zero commitment, we, Tillotts Pharma UK, have additionally set ourselves the following medium-term carbon emissions reduction target. We are striving to reduce our carbon emissions to 140 t CO2e in 2030. This is a reduction of 26 % despite steady growth.

Carbon Reduction Projects
Completed carbon reduction initiatives
- Establishment of a Sustainability Leadership Team for the entire group of companies (TPG)
- Tree planting initiative
- Reducing emissions from business trips and commuting by actively promoting working from home and
increasing the use of online customer meetings instead of on-site appointments.

Planned carbon reduction initiatives
The sustainability target set can only be achieved through ambitious and comprehensive measures that require the active cooperation of our employees. Workshops were held to identify a broad portfolio of projects and measures, which were assessed based on their feasibility as well as their impact and divided into 4 categories relating to their planned implementation.

Immediate measures (2024)
- Sustainability training to raise awareness among all employees.
- Tree planting initiative close to the office building.
- Promotion of public transport and sustainable means of transport instead of climate-damaging subsidies (parking
spaces, etc.)
- Transparent internal and external reporting of our Carbon Reduction Plan.
- Participate at "Cycle to Work Day"

Short-term measures (2024-2026)
- Inclusion of climate risks and opportunities in our risk management system.
- Integration of climate considerations into companies' strategic decision-making processes.
- Working with the owners of the rented office to measure electricity consumption and switch to 100% renewable
energy.
- Reduction of business travel through effective measurement and a sustainable travel policy as well as CO2
compensation for unavoidable business trips.



TILLOTTS PHARMA UK LIMITED (REGISTERED NUMBER: 07186552)

REPORT OF THE DIRECTORS
for the Year Ended 31 DECEMBER 2023

STREAMLINED ENERGY AND CARBON REPORTING (continued)
Short-term measures (2024-2026) (continued)
- Work with transporters to understand their own emissions. Encourage them to set their own carbon reduction
targets.
- Work together with customers to improve the data collection regarding CO2e emissions in the category
"downstream transportation and distribution".

Medium-term measures (2027-2029)
- Group-wide introduction of the Corporate Sustainability Reporting Directive. This involves the implementation
of a wide range of processes and key figures that we use to manage and track all sustainability issues.
- Transparent internal and external reporting on our sustainability journey (strategy, processes, key figures,
measures).

Long-term measures (from 2030)
- Complete renunciation of fossil fuels in the fleet of the transport company.

STATEMENT OF DIRECTORS' RESPONSIBILITIES
The directors are responsible for preparing the Strategic Report, the Report of the Directors and the financial statements in accordance with applicable law and regulations.

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

-select suitable accounting policies and then apply them consistently;
-make judgements and accounting estimates that are reasonable and prudent;
-state whether applicable accounting standards have been followed, subject to any material departures disclosed and
explained in the financial statements;
-prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.

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

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS
So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and each director has taken all the steps that he or she ought to have taken as a director in order to make himself or herself aware of any relevant audit information and to establish that the company's auditors are aware of that information.

ON BEHALF OF THE BOARD:





Mr J Thorpe - Director


18 March 2024

REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF
TILLOTTS PHARMA UK LIMITED

Opinion
We have audited the financial statements of Tillotts Pharma UK Limited (the 'company') for the year ended 31 December 2023 which comprise the Statement of Comprehensive Income, Balance Sheet, Statement of Changes in Equity, Cash Flow Statement and Notes to the Cash Flow Statement, Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:
-give a true and fair view of the state of the company's affairs as at 31 December 2023 and of its profit for the year then ended;
-have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
-have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

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

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

Other information
The directors are responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon.

Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
- the information given in the Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and
- the Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements.

REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF
TILLOTTS PHARMA UK LIMITED


Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Report of the Directors.

We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:
- adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
- the financial statements are not in agreement with the accounting records and returns; or
- certain disclosures of directors' remuneration specified by law are not made; or
- we have not received all the information and explanations we require for our audit.

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

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

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

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

The objectives of our audit are to identify and assess the risk of material misstatement of the financial statements due to fraud and error; to obtain sufficient appropriate audit evidence regarding the assessment of risk of material misstatement due to fraud or error; and to respond appropriately to those risks. Owing to the inherent limitations of an audit, there is unavoidable risk that material misstatements in the financial statements may not be detected, even though the audit is properly planned and performed in accordance with the ISAs (UK). The more removed the laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. 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.

REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF
TILLOTTS PHARMA UK LIMITED

Auditors' responsibilities for the audit of the financial statements (continued)
In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, our procedures included the following:
- we obtained an understanding of the legal and regulatory frameworks applicable to the company and the sector in which they operate. We determined the following laws and regulations were most significant: the Companies Act 2006, UK corporate taxation laws, Medicines & Healthcare products regulations (including Wholesale Distribution Authorisation) and Department of Health and Social Care regulations (including The Voluntary Scheme 2019).
- we obtained an understanding of how the company is complying with those legal and regulatory frameworks by making enquires to management. We corroborated our enquires through our review of UK Leadership Team minutes, licensing data held on regulators' websites and recalculations of financial reports provided to regulators.
- we ensured that identified laws and regulations were communicated within the audit team along with ensuring the audit team had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations.
understanding of how fraud might occur by:
- making enquiries of management as to where they considered there was a susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; and
- considering the internal controls in place to mitigate the risk of fraud and non-compliance with laws and regulations.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors.

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




Stephen Mason BSc FCA (Senior Statutory Auditor)
for and on behalf of FKCA Limited
Statutory Auditor
260 - 270 Butterfield
Great Marlings
Luton
Bedfordshire
LU2 8DL

20 March 2024

TILLOTTS PHARMA UK LIMITED (REGISTERED NUMBER: 07186552)

STATEMENT OF COMPREHENSIVE
INCOME
for the Year Ended 31 DECEMBER 2023

2023 2022
Notes £    £   

TURNOVER 53,899,030 44,536,181

Cost of sales 43,143,707 33,664,220
GROSS PROFIT 10,755,323 10,871,961

Administrative expenses 8,341,797 8,901,640
2,413,526 1,970,321

Other operating income 600 1,650
OPERATING PROFIT 4 2,414,126 1,971,971

Interest receivable and similar income 5 102,180 292
2,516,306 1,972,263

Interest payable and similar expenses 6 824,216 450,941
PROFIT BEFORE TAXATION 1,692,090 1,521,322

Tax on profit 7 403,871 289,016
PROFIT FOR THE FINANCIAL YEAR 1,288,219 1,232,306

OTHER COMPREHENSIVE INCOME - -
TOTAL COMPREHENSIVE INCOME
FOR THE YEAR

1,288,219

1,232,306

TILLOTTS PHARMA UK LIMITED (REGISTERED NUMBER: 07186552)

BALANCE SHEET
31 DECEMBER 2023

2023 2022
Notes £    £   
CURRENT ASSETS
Stocks 8 7,619,339 12,637,145
Debtors 9 18,344,721 9,601,831
Cash at bank 5,511,546 12,228,580
31,475,606 34,467,556
CREDITORS
Amounts falling due within one year 10 22,629,332 26,909,501
NET CURRENT ASSETS 8,846,274 7,558,055
TOTAL ASSETS LESS CURRENT
LIABILITIES

8,846,274

7,558,055

CAPITAL AND RESERVES
Called up share capital 12 20,000 20,000
Retained earnings 8,826,274 7,538,055
SHAREHOLDERS' FUNDS 8,846,274 7,558,055

The financial statements were approved by the Board of Directors and authorised for issue on 18 March 2024 and were signed on its behalf by:





Mr J Thorpe - Director


TILLOTTS PHARMA UK LIMITED (REGISTERED NUMBER: 07186552)

STATEMENT OF CHANGES IN EQUITY
for the Year Ended 31 DECEMBER 2023

Called up
share Retained Total
capital earnings equity
£    £    £   
Balance at 1 January 2022 20,000 6,305,749 6,325,749

Changes in equity
Total comprehensive income - 1,232,306 1,232,306
Balance at 31 December 2022 20,000 7,538,055 7,558,055

Changes in equity
Total comprehensive income - 1,288,219 1,288,219
Balance at 31 December 2023 20,000 8,826,274 8,846,274

TILLOTTS PHARMA UK LIMITED (REGISTERED NUMBER: 07186552)

CASH FLOW STATEMENT
for the Year Ended 31 DECEMBER 2023

2023 2022
Notes £    £   
Cash flows from operating activities
Cash generated from operations 1 9,636,499 9,397,022
Interest paid (824,216 ) (450,941 )
Tax paid (312,326 ) (331,599 )
Net cash from operating activities 8,499,957 8,614,482

Cash flows from investing activities
Interest received 102,180 292
Net cash from investing activities 102,180 292

Cash flows from financing activities
Loan repayments in year (15,319,171 ) (2,589,280 )
Net cash from financing activities (15,319,171 ) (2,589,280 )

(Decrease)/increase in cash and cash equivalents (6,717,034 ) 6,025,494
Cash and cash equivalents at beginning of
year

2

12,228,580

6,203,086

Cash and cash equivalents at end of year 2 5,511,546 12,228,580

TILLOTTS PHARMA UK LIMITED (REGISTERED NUMBER: 07186552)

NOTES TO THE CASH FLOW STATEMENT
for the Year Ended 31 DECEMBER 2023

1. RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM
OPERATIONS
2023 2022
£    £   
Profit before taxation 1,692,090 1,521,322
Finance costs 824,216 450,941
Finance income (102,180 ) (292 )
2,414,126 1,971,971
Decrease in stocks 5,017,806 5,099,677
(Increase)/decrease in trade and other debtors (8,742,890 ) 1,228,290
Increase in trade and other creditors 10,947,457 1,097,084
Cash generated from operations 9,636,499 9,397,022

2. CASH AND CASH EQUIVALENTS

The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts:

Year ended 31 December 2023
31.12.23 1.1.23
£    £   
Cash and cash equivalents 5,511,546 12,228,580
Year ended 31 December 2022
31.12.22 1.1.22
£    £   
Cash and cash equivalents 12,228,580 6,203,086


3. ANALYSIS OF CHANGES IN NET FUNDS

Other
non-cash
At 1.1.23 Cash flow changes At 31.12.23
£    £    £    £   
Net cash
Cash at bank 12,228,580 (6,717,034 ) 5,511,546
12,228,580 (6,717,034 ) 5,511,546
Debt
Debts falling due
within 1 year 6,098,190 (15,319,108 ) 10,970,918 1,750,000
6,098,190 (15,319,108 ) 10,970,918 1,750,000
Total 18,326,770 (22,036,142 ) 10,970,918 7,261,546

4. MAJOR NON-CASH TRANSACTIONS

During the year the company converted £10,947,457 of trade amounts owed to a group undertaking into an interest bearing loan.

TILLOTTS PHARMA UK LIMITED (REGISTERED NUMBER: 07186552)

NOTES TO THE FINANCIAL STATEMENTS
for the Year Ended 31 DECEMBER 2023

1. STATUTORY INFORMATION

Tillotts Pharma UK Limited is a private company, limited by shares , registered in England and Wales. The company's registered number and registered office address can be found on the Company Information page.

2. ACCOUNTING POLICIES

Basis of preparing the financial statements
These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

Turnover
The turnover shown in the profit and loss account represents amounts invoiced during the year less discounts and rebates given, exclusive of Value Added Tax.

Stocks
Stocks are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items.

Financial instruments
The company has chosen to adopt Sections 11 and 12 of FRS 102 in respect of financial instruments.

Basic financial assets and liabilities, including trade and other debtors, trade and other creditors and loans from fellow group companies are recognised at cost.

Taxation
Taxation for the year comprises current tax. Tax is recognised in the Statement of Comprehensive Income, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

Foreign currencies
Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result.

Pension costs and other post-retirement benefits
The company operates a defined contribution pension scheme. Contributions payable to the company's pension scheme are charged to profit or loss in the period to which they relate.

3. EMPLOYEES AND DIRECTORS
2023 2022
£    £   
Wages and salaries 3,207,373 3,377,660
Social security costs 409,553 493,690
Other pension costs 159,877 167,609
3,776,803 4,038,959

TILLOTTS PHARMA UK LIMITED (REGISTERED NUMBER: 07186552)

NOTES TO THE FINANCIAL STATEMENTS - continued
for the Year Ended 31 DECEMBER 2023

3. EMPLOYEES AND DIRECTORS - continued

The average number of employees during the year was as follows:
2023 2022

Management and administration 13 12
Sales 28 28
41 40

2023 2022
£    £   
Directors' remuneration 256,604 244,968
Directors' pension contributions to money purchase schemes 19,407 19,407

The number of directors to whom retirement benefits were accruing was as follows:

Money purchase schemes 1 1

Information regarding the highest paid director is as follows:
2023 2022
£    £   
Emoluments etc 256,604 244,968
Pension contributions to money purchase schemes 19,407 19,407

4. OPERATING PROFIT

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

2023 2022
£    £   
Auditor's remuneration 11,760 11,200
Audit-related assurance services 8,860 47,176
Foreign exchange differences (2,715 ) 19,446
Operating lease costs 34,615 34,615

5. INTEREST RECEIVABLE AND SIMILAR INCOME
2023 2022
£    £   
Bank interest receivable 102,180 292

6. INTEREST PAYABLE AND SIMILAR EXPENSES
2023 2022
£    £   
Group loan interest paid 824,216 450,941

TILLOTTS PHARMA UK LIMITED (REGISTERED NUMBER: 07186552)

NOTES TO THE FINANCIAL STATEMENTS - continued
for the Year Ended 31 DECEMBER 2023

7. TAXATION

Analysis of the tax charge
The tax charge on the profit for the year was as follows:
2023 2022
£    £   
Current tax:
UK corporation tax 403,871 289,016
Tax on profit 403,871 289,016

Reconciliation of total tax charge included in profit and loss
The tax assessed for the year is lower than the standard rate of corporation tax in the UK. The difference is explained below:

2023 2022
£    £   
Profit before tax 1,692,090 1,521,322
Profit multiplied by the standard rate of corporation tax in the UK of 25%
(2022 - 19%)

423,023

289,051

Effects of:
Over/(under) provision of tax charge in respect of current period - (35 )
Charged at different rate of tax (19,152 ) -
Total tax charge 403,871 289,016

8. STOCKS
2023 2022
£    £   
Stocks 7,619,339 12,637,145

An impairment loss of £129,000 was reversed in cost of sales against stock during the year (2022 - loss recognised of £326,000).

9. DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
2023 2022
£    £   
Trade debtors 18,131,226 9,038,245
Amounts owed by group undertakings - 429,270
Other debtors 1,033 1,033
Prepayments and accrued income 212,462 133,283
18,344,721 9,601,831

TILLOTTS PHARMA UK LIMITED (REGISTERED NUMBER: 07186552)

NOTES TO THE FINANCIAL STATEMENTS - continued
for the Year Ended 31 DECEMBER 2023

10. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
2023 2022
£    £   
Trade creditors 446,485 607,728
Amounts owed to group undertakings 16,963,716 22,388,975
Corporation tax 184,454 92,909
Taxation and social security 8,690 163,731
VAT 778,608 794,752
Accruals and deferred income 4,247,379 2,861,406
22,629,332 26,909,501

The company has one remaining loan from the parent company included in amounts owed to group undertakings. An amount of £1,750,000 (2022 - £1,750,000) is granted for an undetermined period of time and it may be repaid at anytime, interest on this loan is 2% per annum. A second loan of £4,348,190 was repaid in the year, interest was payable on this loan at 6.5%. The remaining amount owed to group undertaking is payable in accordance with normal trading terms.

11. LEASING AGREEMENTS

Minimum lease payments under non-cancellable operating leases fall due as follows:
2023 2022
£    £   
Within one year 34,615 20,192
Between one and five years 19,240 -
53,855 20,192

12. CALLED UP SHARE CAPITAL

Allotted, issued and fully paid:
Number: Class: Nominal 2023 2022
value: £    £   
20,000 Ordinary 1 20,000 20,000

Ordinary shares are entitled to full voting, dividend and capital distribution rights. They do not confer any rights of redemption.

13. RELATED PARTY DISCLOSURES

The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party transactions with wholly owned subsidiaries within the group.

14. ULTIMATE CONTROLLING PARTY

The ultimate controlling party is Zeria Pharmaceutical Co. Limited, incorporated in Japan.

The registered office of the parent company, Tillotts Pharma AG, is Service Centre B-15, Baslerstrasse 15, CH-4310, Rheinfelden, Switzerland.