Company registration number 03455690 (England and Wales)
CF FERTILISERS UK LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
CF FERTILISERS UK LIMITED
COMPANY INFORMATION
Directors
Mrs Susan Menzel
Mr Ashraf Malik
Mr Bert Frost
Mr Christopher Bohn
Mr Brett Nightingale
Company number
03455690
Registered office
Head Office Building
Ince
Chester
United Kingdom
CH2 4LB
Auditor
Azets
Alpha House
4 Greek St
Stockport
Cheshire
United Kingdom
SK3 8AB
Bankers
Citibank N.A
Citi Group Centre
Canada Square
Canary Wharf
London
United Kingdom
E14 5LB
Solicitors
Eversheds
Bridgewater Place
Water Lane
Leeds
United Kingdom
LS11 5DR
Burges Salmon LLP
One Glass Wharf
Bristol
BS2 0ZX
Hill Dickinson LLP
No 1 St Pauls Square
Liverpool
United Kingdom
L3 9SJ
CF FERTILISERS UK LIMITED
COMPANY INFORMATION
Shoosmiths LLP
XYZ Building
2 Hardman Boulevard
Spinningfields
Manchester
United Kingdom
M3 3AZ
Skadden, Arps, Slate, Meagher & Flom (UK) LLP
40 Bank Street
Canary Wharf
London
United Kingdom
E14 5DS
WilmerHale
49 Park Lane
London
United Kingdom
W1K 1PS
CF FERTILISERS UK LIMITED
CONTENTS
Page
Strategic report
1 - 3
Directors' report
4 - 6
Directors' responsibilities statement
7
Independent auditor's report
8 - 10
Profit and loss account
11
Statement of comprehensive income
12
Balance sheet
13 - 14
Statement of changes in equity
15
Notes to the financial statements
16 - 39
CF FERTILISERS UK LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -

The Directors present the Strategic Report for the year ended 31 December 2023.

Principal activities

The principal activities of CF Fertilisers UK Limited (“the Company”) are the manufacture and supply of plant nutrients into the agricultural market and intermediate chemicals into the process chemicals industry.

 

The immediate parent company is CF Industries (UK) Limited, which is an intermediate holding company, ultimately controlled by CF Industries Holdings, Inc.

Results for the year
2023
2022
%
£'000
£'000
change
Turnover
252,124
578,473
(56)
Operating profit/(loss)
30,990
(31,863)
197
Profit/(loss) for the financial year
31,433
(28,057)
212
Costs attributable to UK restructuring
(3,428)
(134,074)
(97)
Operating profit excl. UK restructuring
34,418
102,211
(66)
Turnover decreased in comparison to the prior year, as product prices adjusted downwards after the unprecedented upward price pressure on wholesale gas and market prices in 2022.
Expenses incurred in relation to the 2022 Ince site closure and Billingham Ammonia plant closure are summarised in the above table. The Company continues to operate the Ammonia importation model to fulfil production at the Billingham site.
2023
2022
%
£'000
£'000
change
Net current assets
146,361
146,634
(0)
Net assets
228,037
197,545
15
Net assets excluding pension liability
233,479
219,932
6
Defined benefit pension liability
(5,442)
(22,387)
(76)
There was no dividend payment in the year (2022: £Nil).
The net pension liabilities decrease from 2022 was mainly attributable to an improvement in the return on plan assets.
CF FERTILISERS UK LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
Principal risks and uncertainties

The Company’s activities are exposed to several financial risks including price risk, credit risk and liquidity risk.

Price risk

Ammonia prices are recognised as a source of risk as they represent a significant portion of product cost and can fluctuate with market conditions. The Company’s exposure to Ammonia price risk is constantly monitored with regular updates given to the Directors and Management.

Credit risk

The Company’s principal financial assets are bank balances and trade debtors.

The Company continually reviews the credit risk associated with its trade debtors.

The Company’s principal financial liabilities are trade payables and accruals. The Company purchases under typical industry credit terms.

Liquidity risk

As at 31 December 2023, the Company had no outstanding balance under the revolving loan facility provided by CF Industries Enterprises, LLC. This facility was amended on 8 March 2024, extending the £45,000,000 facility termination date to 31 December 2026. None of the aforementioned loan was drawn as at 31 December 2023.

The Board periodically undertakes a review of treasury risks facing the Company and ensures the appropriate treasury management strategies are in place to manage those risks.

Going concern

On 31 December 2023, the Company showed a cash position of £115,025,000. The Company continues to have access to a £45,000,000 revolving loan facility provided by CF Industries Enterprises LLC and a £5,000,000 7-day tenor unsecured overdraft facility with Citi Bank. On 31 December 2023, no borrowings were outstanding on either facility.

The Directors have prepared cash flow forecasts for a period of at least 12 months from the date of approval of these financial statements. The forecast has been prepared on the basis that the Company continues to operate from the Billingham complex under the imported Ammonia model. Management has developed several plausible severe downside scenarios, including a mechanical failure of the Billingham complex and adverse foreign exchange rate movements. The forecast demonstrates that by taking account of plausible downside changes, the Company will have sufficient funds to meet its liabilities as they fall due for that period, with sufficient headroom to fund anticipated costs as they become due.

Consequently, the Directors are confident that the Company will have sufficient funds to continue to meet its liabilities as they fall due for at least 12 months from the date of approval of the financial statements. The Directors have therefore prepared the financial statements on a going concern basis.

Future prospects

The Directors are confident regarding the future outlook of the business.

Environment

The Company is committed to conducting business in a manner which will protect the environment, in accordance with all legal requirements and sound environmental management practices. The Company has practices in place for the continuous review and improvement of its operations in order to reduce their environmental impact and its use of resources, outlined in the Directors’ Report, Streamlined Energy and Carbon Reporting.

Safety

The Company puts safety first and takes it seriously, not only of the individuals who work in its plants, but also the communities in which it operates. The Company continually reviews and seeks to improve the safety of its operations. Safety (and operational reliability) underpins the Company’s significant level of capital expenditure.

CF FERTILISERS UK LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -
Corporate governance

The Directors are committed to engagement with employees and other stakeholders of the Company in compliance with section 172(1) (a) to (f), The Companies (Miscellaneous Reporting) Regulations 2018, described below and in the Directors’ Report p 4-6.

 

During the period, the Directors have focused attention on how to deliver the best outcomes considering the management of all stakeholders including employees, customers, suppliers and the broader community, evidenced as follows:

 

 

The Directors are satisfied that S172 requirements have been performed to a high standard and in line with the code of conduct requirements of all employees.

On behalf of the board

Mr Christopher Bohn
Director
27 March 2024
CF FERTILISERS UK LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 4 -

The Directors present their annual report and financial statements for the year ended 31 December 2023.

Results and dividends

The results for the year are set out on page 11.

No ordinary dividends were paid. The Directors do not recommend payment of a final dividend.

Directors

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

Mrs Susan Menzel
Mr Ashraf Malik
Mr Bert Frost
Mr Douglas Barnard
(Resigned 12 January 2024)
Mr Christopher Bohn
Mr Brett Nightingale
Qualifying third party indemnity provisions

The Company has made qualifying third party indemnity provisions for the benefit of its Directors during the year. These provisions remain in force at the reporting date.

Supplier payment policy

It is Company policy to agree and clearly communicate the terms of payment as part of the commercial arrangement negotiated with suppliers and then to pay according to those terms based upon the timely receipt of an accurate invoice.

Trade creditor days of the Company for the year ended 31 December 2023 were 24 days (2022: 20 days), calculated as the ratio, expressed in days, between the amounts invoiced to the Company by its suppliers in the year and the amounts due to trade creditors at the year end.

Political and charitable donations

During the year the Company made charitable donations of £32,444 (2022: £6,000), principally to local charities serving the communities in which the Company operates. The Company made no political donations (2022: £Nil).

Disabled persons

The Company gives full and fair consideration to applications for employment made by disabled persons having regard to their particular aptitudes and abilities. Appropriate training is arranged and reasonable adjustments made for disabled persons, including retraining for suitable alternative work for employees who become disabled, the aim being to facilitate the employee’s ability to remain within the organisation.

Employee involvement

Regular meetings are held with employee representatives. Opportunity is given at these meetings for senior management to be questioned about matters that concern the employees.

The Company complies with all employment legislation including requirements concerning equal opportunities in employment, employment of disabled people and health and safety at work.

 

Health, safety and welfare of employees

The Company is committed to protecting the health, safety and welfare of its employees. This is achieved by complying with all relevant health and safety legislation and adopting appropriate industry standards. This in turn is supported by controlled systems of work and the provision of health, safety and welfare training and services. The Company has achieved certification to OSHAS 18001 across all locations.

CF FERTILISERS UK LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 5 -
Post reporting date events

There have been no post balance sheet events since 31st December 2023 to the date of signing the Directors Report that warrant disclosure.

Auditor

Azets were appointed as auditor to the Company and in accordance with section 485 of the Companies Act 2006, a resolution proposing that they be re-appointed will be put at a Board Meeting.

Energy and carbon report

2023 Emissions have been significantly reduced by plant shutdowns due to extremely high UK energy prices and are not representative of normal operations. During 2022, the closure of the Ince site was announced, further reducing emissions in 2022 and in future years.

2023
2022
Energy consumption
kWh
kWh
Aggregate of energy consumption in the year
202,710,255
3,452,112,225
2023
2022
Emissions of CO2 equivalent
metric tonnes
metric tonnes
Scope 1 - direct emissions
- Production of products
36,204
636,741
- Fuel consumed for owned transport
946
1,494
37,150
638,235
Scope 3 - other indirect emissions
- From business travel in rented cars or employee-owned vehicles where the Company is responsible for purchasing fuel
298
482
Total gross emissions
37,448
638,717
Intensity ratio
Total gross tCO2e/Turnover (£m)
149
1,104.14
Quantification and reporting methodology

The Company's operations are subject to reporting requirements under the ETS, with direct emissions calculated in-line with ETS permit requirements.

Energy efficiency action summary

The Company's operations are significantly less energy intensive in 2023, since the Company has transitioned from manufacturing Ammonia to purchase Ammonia. However, continued improvement projects on existing plants are assessed and incremental steps undertaken during periodic maintenance shutdowns to improve efficiency.

Statement of disclosure to auditor

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

Other information

Current developments in the business and particulars of significant events which have occurred in the financial year have been included in the Strategic Report on pages 1-3, along with details of financial risks to the business, going concern and related cashflow; and the actions undertaken by the Directors to manage such risks.

CF FERTILISERS UK LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 6 -
On behalf of the board
Mr Christopher Bohn
Director
27 March 2024
CF FERTILISERS UK LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 7 -

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

 

Company law requires the Directors to prepare financial statements for each financial year. Under that law the Directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law).

 

Under company law the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and of the profit or loss of the Company for that period. In preparing these financial statements, the Directors are required to:

 

 

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

CF FERTILISERS UK LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF CF FERTILISERS UK LIMITED
- 8 -
Opinion

We have audited the financial statements of CF Fertilisers UK Limited (the 'Company') for the year ended 31 December 2023 which comprise the profit and loss account, the statement of comprehensive income, the balance sheet, the statement of changes in equity 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 101 Reduced Disclosure Framework (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

Basis for opinion

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

Conclusions relating to going concern

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

 

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

 

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

Other information

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

 

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

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

CF FERTILISERS UK LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF CF FERTILISERS UK LIMITED
- 9 -
Matters on which we are required to report by exception

In the light of the knowledge and understanding of the Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Directors Report.

 

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

Responsibilities of Directors

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

Auditor's responsibilities for the audit of the financial statements

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

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.

CF FERTILISERS UK LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF CF FERTILISERS UK LIMITED
- 10 -

Extent to which the audit was considered capable of detecting irregularities, including fraud

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above and on the Financial Reporting Council’s website, to detect material misstatements in respect of irregularities, including fraud.

 

We obtain and update our understanding of the entity, its activities, its control environment, and likely future developments, including in relation to the legal and regulatory framework applicable and how the entity is complying with that framework.  Based on this understanding, we identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion.  This includes consideration of the risk of acts by the entity that were contrary to applicable laws and regulations, including fraud.

 

In response to the risk of irregularities and non-compliance with laws and regulations, including fraud, we designed procedures which included:

 

 

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 of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

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.

Helen Davies (Senior Statutory Auditor)
For and on behalf of Azets Audit Services
27 March 2024
Chartered Accountants
Statutory Auditor
Alpha House
4 Greek St
Stockport
Cheshire
United Kingdom
SK3 8AB
CF FERTILISERS UK LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 11 -
2023
2022
Notes
£'000
£'000
Turnover
3
252,124
578,473
Cost of sales
27
(230,151)
(555,651)
Gross profit
21,973
22,822
Distribution costs
(14,774)
(23,076)
Administrative expenses
27
(14,177)
(31,461)
Other operating income
4
53,967
21,197
Other operating expenses
4
(15,999)
(21,345)
Operating profit/(loss)
5
30,990
(31,863)
Interest receivable and similar income
8
15,464
7,374
Interest payable and similar expenses
9
(13,496)
(9,497)
Profit/(loss) before taxation
32,958
(33,986)
Tax on profit/(loss)
10
(1,525)
5,929
Profit/(loss) for the financial year
31,433
(28,057)

The notes on pages 16 to 39 form part of these financial statements.

CF FERTILISERS UK LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
- 12 -
2023
2022
Notes
£'000
£'000
Profit/(loss) for the year
31,433
(28,057)
Other comprehensive income:
Items that will not be reclassified to profit or loss
Actuarial (loss)/gain on defined benefit pension schemes
21
(1,741)
22,334
Tax relating to items not reclassified
10
435
(5,174)
Total items that will not be reclassified to profit or loss
(1,306)
17,160
Total comprehensive income/(loss) for the year
30,127
(10,897)

The notes on pages 16 to 39 form part of these financial statements.

CF FERTILISERS UK LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2023
31 December 2023
- 13 -
2023
2022
as restated
Notes
£'000
£'000
£'000
£'000
Fixed assets
Tangible fixed assets
13
95,301
80,170
Current assets
Stocks
14
20,833
44,493
Deferred tax asset
19
8,380
10,392
Debtors
15
24,783
62,107
Cash at bank and in hand
115,025
63,616
169,021
180,608
Creditors: amounts falling due within one year
16
(22,660)
(33,974)
Net current assets
146,361
146,634
Total assets less current liabilities
241,662
226,804
Creditors: amounts falling due after more than one year
16
(2,716)
(245)
Provisions for liabilities
Other provisions
20
(5,467)
(6,627)
Net assets excluding pension liability
233,479
219,932
Defined benefit pension liability
21
(5,442)
(22,387)
Net assets
228,037
197,545
Capital and reserves
Called up share capital
23
13,594
13,594
Share premium account
97,359
97,359
Other reserves
3,633
3,268
Profit and loss reserves
113,451
83,324
Total equity
228,037
197,545

The notes on pages 16 to 39 form part of these financial statements.

The note in relation to the prior year restatement can be found at note 28.
CF FERTILISERS UK LIMITED
BALANCE SHEET (CONTINUED)
AS AT
31 DECEMBER 2023
31 December 2023
- 14 -
The financial statements were approved by the Board of Directors and authorised for issue on 27 March 2024 and are signed on its behalf by:
Mr Christopher Bohn
Director
Company registration number 03455690
CF FERTILISERS UK LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 15 -
Share capital
Share premium account
Other reserves
Profit and loss reserves
Total
£'000
£'000
£'000
£'000
£'000
Balance at 1 January 2022
13,594
97,359
2,673
94,221
207,847
Year ended 31 December 2022:
Loss for the year
-
-
-
(28,057)
(28,057)
Other comprehensive income:
Actuarial gains on pension schemes
-
-
-
22,334
22,334
Tax relating to other comprehensive income
-
-
-
(5,174)
(5,174)
Total comprehensive loss for the year
-
-
-
(10,897)
(10,897)
Transactions with owners in their capacity as owners:
Share based payments
-
-
595
-
0
595
Balance at 31 December 2022
13,594
97,359
3,268
83,324
197,545
Year ended 31 December 2023:
Profit for the year
-
-
-
31,433
31,433
Other comprehensive income:
Actuarial losses on pension schemes
-
-
-
(1,741)
(1,741)
Tax relating to other comprehensive income
-
-
-
435
435
Total comprehensive income for the year
-
-
-
30,127
30,127
Transactions with owners in their capacity as owners:
Share based payments
-
-
365
-
0
365
Balance at 31 December 2023
13,594
97,359
3,633
113,451
228,037

The notes on pages 16 to 39 form part of these financial statements.

CF FERTILISERS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 16 -
1
Accounting policies
Company information

CF Fertilisers UK Limited (the "Company") is a private company limited by shares incorporated in England and Wales. The registered office is Head Office Building, Ince, Chester, United Kingdom, CH2 4LB. The Company's principal activities and nature of its operations are disclosed in the Strategic Report.

1.1
Accounting convention

The financial statements have been prepared in accordance with Financial Reporting Standard 101 Reduced Disclosure Framework (FRS 101) and in accordance with applicable accounting standards.

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 £'000.

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

As permitted by FRS 101, the Company has taken advantage of the following disclosure exemptions from the requirements of International Financial Reporting Standards (IFRS):

 

Where required, equivalent disclosures are given in the group accounts of CF Industries Holdings, Inc. The group accounts of CF Industries Holdings, Inc. are available to the public and can be obtained as set out in note 26.

1.2
Prior period error

Prior period restatement to align impairment to underlying assets (Note 28).

1.3
Going concern

The trueDirectors have at the time of approving the financial statements, gained the necessary assurance to be confident that the Company has adequate resources to continue in operational existence for at least 12 months from the date of signing these accounts. The Directors continue to adopt the going concern basis of accounting in preparing the financial statements.

1.4
Turnover

Turnover represents the invoiced value of goods and services provided in the normal course of business, net of rebates, and excluding value added tax. Revenue is recognised at the point of despatch, or where satisfaction of a performance obligation transfers control of goods to the customer occurs, when this is not the same as the date of despatch.

CF FERTILISERS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 17 -

Other operating income relates mainly to the sale of utilities, which are covered by contracts to supply. The income recognised is determined as follows:

1.5
Goodwill

Goodwill represents the excess of the cost of acquisition over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less impairment losses.

 

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. An impairment loss recognised for goodwill is subsequently reversed if, and only if, the reasons for the impairment loss have ceased to apply. At year end, the goodwill has been fully amortised/impaired.

1.6
Intangible assets other than goodwill

Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.

 

Patents, trademarks and similar rights

Patents and trademarks are included at net book value as at the transition date 1 January 2014.

Research and development

Expenditure on research activities is written off to the profit and loss account in the year in which it is incurred.

Expenditure on development activities is capitalised if the product or process is technically and commercially feasible and the Company intends and has the technical ability and sufficient resources to complete development, future economic benefits are probable and if the Company can measure reliably the expenditure attributable to the intangible asset during its development. Development activities involve a plan or design for the production of new or substantially improved products or processes. The expenditure capitalised includes the cost of material and any external labour involved with the development project. Other development expenditure is recognised in the profit and loss account as an expense is incurred.

 

Other intangible assets

Expenditure on internally generated goodwill and brands is recognised in the profit and loss account as an expense is incurred.

 

Amortisation 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:

 

CF FERTILISERS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 18 -
1.7
Tangible fixed assets

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

 

Stocks of precious metals, used as catalysts in the production process, are valued on a weighted average cost basis. Cost comprises purchase price and associated refining costs.

The cost of precious metals used in the manufacture of nitric acid is charged at an estimated rate of use, based on production levels, over the life of the campaign. The amount of precious metal actually used during the campaign is established when the catalyst is removed from the plant at the end of the campaign and the remaining precious metal is recovered as part of the refining process. Any adjustment to estimated usage is made at the end of the refining process.

Engineering spares of a long term nature are valued at cost, with provision made for slow moving and obsolete spares, less any provision for impairment.

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

Freehold buildings
4% - 7%
Plant and equipment
3% - 25%

The costs associated with the plant maintenance for periodic shutdowns and catalyst replacement are capitalised within plant and equipment and depreciated over the period until the next shutdown or replacement, being no longer than 15 years.

 

Freehold land and capital work in progress are not depreciated.

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.

1.8
Impairment of tangible and intangible assets

At each reporting end date, the Company assesses whether there are indicators of impairment. If indicators are identified, the Company will assess the recoverable amount compared to the carrying value. Where it is not possible to estimate the recoverable amount of an individual asset, the Company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

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

 

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

 

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

CF FERTILISERS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 19 -
1.9
Stocks

Stocks are stated at the lower of cost and net realisable value. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.

 

Net realisable value is the estimated selling price less all estimated costs of completion and costs to be incurred in marketing, selling and distribution.

 

Engineering spares are valued at cost with provision made for slow moving and obsolete spares, less any provision for impairment.

1.10
Cash at bank and in hand

Cash and cash equivalents include cash in hand, deposits held 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.

1.11
Financial assets

Financial assets are recognised in the Company's balance sheet when the Company becomes party to the contractual provisions of the instrument. Financial assets are classified into specified categories, depending on the nature and purpose of the financial assets.

Impairment of financial assets

Financial assets carried at amortised cost are assessed for indicators of impairment at each reporting end date.

1.12
Financial liabilities

The Company recognises financial debt when the Company becomes a party to the contractual provisions of the instruments. Financial liabilities are classified as either 'financial liabilities at fair value through profit or loss' or 'other financial liabilities'.

 

Other financial liabilities, including borrowings, trade payables and other short-term monetary liabilities, are initially measured at amortised cost.

 

1.13
Equity instruments

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

1.14
Taxation

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

Current tax

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

CF FERTILISERS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 20 -
Deferred tax

Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit and is accounted for using the balance sheet liability method. Deferred tax liabilities are generally recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised. Such assets and liabilities are not recognised if the temporary difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

 

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

1.15
Provisions

Provisions are recognised when the Company has a legal or constructive present obligation as a result of a past event and it is probable that the Company will be required to settle that obligation, and a reliable estimate can be made of the amount of the obligation.

 

The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the reporting end date, taking into account the risks and uncertainties surrounding the obligation. Where a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows.

 

When some or all of the economic benefits required to settle a provision are expected to be recovered from a third party, a receivable is recognised as an asset if it is virtually certain that reimbursement will be received and the amount of the receivable can be measured reliably.

1.16
Employee benefits

Short-term employee benefit obligations are measured on an undiscounted basis and are expensed as the related service is provided. A liability is recognised for the amount expected to be paid under short-term cash bonus or profit-sharing plans if the Company has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably.

 

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

 

Termination benefits are recognised as an expense when the Company is demonstrably committed, without realistic possibility of withdrawal, to a formal detailed plan to either terminate employment before normal retirement date, or to provide termination benefits as a result of an offer made to encourage voluntary redundancy. Termination benefits for voluntary redundancies are recognised as an expense if the Company has made an offer of voluntary redundancy, it is probable that the offer will be accepted, and the number of acceptances can be estimated reliably. If benefits are payable more than 12 months after the reporting date, then they are discounted to present value.

CF FERTILISERS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 21 -
1.17
Retirement benefits

The Company operates pension schemes providing benefits based on final pensionable salary. The defined benefit Terra Nitrogen (UK) Limited Pension Scheme (East scheme) was closed to future accruals in 2003 and the defined benefit Kemira GrowHow UK Ltd Pension Fund (West scheme) was closed to future accruals in 2009.

The cost of providing benefits under defined benefit plans is determined separately for each plan using the projected unit credit method and is based on actuarial advice.

 

The change in the net defined benefit liability arising from employee service during the year is recognised as an employee cost. The cost of plan introductions, benefit changes, settlements and curtailments are recognised as an expense in measuring profit or loss in the period in which they arise.

For defined benefit schemes the amounts charged to operating profit are the current service costs and gains and losses on settlements and curtailments. They are included as part of staff costs. Past service costs are recognised immediately in the profit and loss account if the benefits have vested. If the benefits have not vested immediately, the costs are recognised over the period until vesting occurs. The interest cost and the expected return on assets are shown as a net amount of other finance costs or credits adjacent to interest. Actuarial gains and losses are recognised immediately as other comprehensive income.

Defined benefit schemes are funded, with the assets of the scheme held separately from those of the Company, in separate trustee administered funds. Pension scheme assets are measured at fair value and liabilities are measured on an actuarial basis using the projected unit credit method and discounted at a rate equivalent to the current rate of return on a high quality corporate bond of equivalent currency and term to the scheme liabilities. The actuarial valuations are obtained at least triennially and are updated at each balance sheet date. The resulting defined benefit asset or liability is presented separately after other net assets on the face of the Balance Sheet.

 

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

1.18
Share-based payments

The Company’s parent grants rights to its equity instruments to certain Company employees, which are accounted for as equity-settled in the consolidated accounts of the parent. The Company accounts for these share-based payments as equity-settled.

1.19
Leases

At inception, the Company assesses whether a contract is, or contains, a lease within the scope of IFRS 16. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. Where a tangible asset is acquired through a lease, the Company recognises a right-of-use asset and a lease liability at the lease commencement date. Right-of-use assets are included within tangible fixed assets, apart from those that meet the definition of investment property.

The right-of-use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date plus any initial direct costs and an estimate of the cost of obligations to dismantle, remove, refurbish or restore the underlying asset and the site on which it is located, less any lease incentives received.

 

The right-of-use asset is subsequently depreciated using the straight-line method from the commencement date to the earlier of the end of the useful life of the right-of-use asset or the end of the lease term. The estimated useful lives of right-of-use assets are determined on the same basis as those of other tangible fixed assets. The right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability.

CF FERTILISERS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 22 -

The lease liability is initially measured at the present value of the lease payments that are unpaid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Company's incremental borrowing rate. Lease payments included in the measurement of the lease liability comprise fixed payments, variable lease payments that depend on an index or a rate, amounts expected to be payable under a residual value guarantee, and the cost of any options that the Company is reasonably certain to exercise, such as the exercise price under a purchase option, lease payments in an optional renewal period, or penalties for early termination of a lease.

The lease liability is measured at amortised cost using the effective interest method. It is remeasured when there is a change in: future lease payments arising from a change in an index or rate; the Company's estimate of the amount expected to be payable under a residual value guarantee; or the Company's assessment of whether it will exercise a purchase, extension or termination option. When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of the right-of-use asset, or it is recorded in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero.

The Company has elected not to recognise right-of-use assets and lease liabilities for short-term leases of machinery that have a lease term of 12 months or less, or for leases of low-value assets including IT equipment. The payments associated with these leases are recognised in profit or loss on a straight-line basis over the lease term.

1.20
Grants

Government grants are recognised when there is reasonable assurance that the grant conditions will be met and the grants will be received.

1.21
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.

1.22

Environmental liabilities

Liabilities for environmental costs are recognised when environmental assessments or clean-ups are probable and the associated costs can be reasonably estimated. Generally, the timing of these provisions coincides with the commitment to a formal plan of action or, if earlier, on divestment or on closure of inactive sites. The amount recognised is the best estimate of the expenditure required. Where the liability will not be settled for a number of years, the amount recognised is the present value of the estimated future expenditure.

Expenditure in respect of environmental liabilities that relates to current or future expenditure is expensed or capitalised as appropriate. Expenditure that relates to an existing condition caused by past operations and does not contribute to current or future earnings is expensed.

Carbon emissions

The Net Liability Approach has been adopted with respect to accounting for carbon emission rights. No asset or deferred income is recognised when the carbon emission allowances are initially allocated. Allowances received are used to offset any liability arising as a result of carbon emissions. No accounting entries are required so long as the Company holds sufficient allowances to meet its emission obligations.

If the Company has insufficient allowances to meet its emission obligation a provision is recognised on the basis of the best estimate of the cost to be incurred to meet the emission obligation. The cost is based on the current market price of the carbon emission allowances required to meet its obligation at the balance sheet date.

1.23

Intra-group financial instruments

Where the Company enters into financial guarantee contracts to guarantee the indebtedness of other companies within its group, the Company treats the guarantee contract as a contingent liability until such time as it becomes probable that the Company will be required to make a payment under the guarantee.

CF FERTILISERS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 23 -
2
Critical accounting estimates and judgements

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

 

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

 

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

Key sources of estimation uncertainty
Useful lives of property, plant and equipment

As described above, the Company reviews the estimated useful lives of property, plant and equipment during each reporting period.

UK restructuring

Following the decision to permanently close the Ince complex in 2022, provisions have been made for expected costs of redundancy, decommissioning and decontamination. Intangible assets have been written down in the prior period. Impairments to tangible assets have been made in the current and prior years.

Actuarial assumptions on pension obligations

In determining the valuation of the defined benefit pension deficit, certain assumptions about the scheme have been made, notably the expected return on assets, inflation, discount rates, mortality and pension increases. The factors affecting these assumptions are largely outside the Company’s control.

3
Turnover
2023
2022
£'000
£'000
Turnover analysed by class of business
Sale of goods
252,124
578,473
2023
2022
£'000
£'000
Turnover analysed by geographical market
United Kingdom
244,723
482,174
Rest of Europe
7,401
74,326
Other Countries
-
21,973
252,124
578,473
CF FERTILISERS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 24 -
4
Other operating income and expenses
2023
2022
£'000
£'000
Comprises:
Utility sales
15,584
21,197
Utility cost of sales
(15,999)
(24,551)
Profit/(loss) margin
(415)
(3,354)
Carbon credit sales
32,139
-
Precious metal recovery
6,629
-
Loss on disposal of tangible fixed assets
(385)
-
Gas swaps
-
3,206
Net other operating income/(expenses)
37,968
(148)
5
Operating profit/(loss)
2023
2022
as restated
Operating profit/(loss) for the year is stated after charging/(crediting):
£'000
£'000
Exchange losses
205
181
Research and development costs
32
52
Government grants
(91)
(127)
Fees payable to the auditor for the audit of the Company's financial statements
265
664
Fees payable for the preparation of the Company's financial statements
8
-
Depreciation of property, plant and equipment
5,581
19,568
Depreciation of leased property, plant and equipment
616
576
Impairment of intangible fixed assets
-
1,805
Impairment of tangible fixed assets
-
104,700
Impairment of stocks
-
0
3,709
The note in relation to the prior year restatement can be found at note 28.
6
Employees

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

2023
2022
Number
Number
Manufacturing
178
377
Sales and administration
40
76
Total
218
453
CF FERTILISERS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
6
Employees
(Continued)
- 25 -

Their aggregate remuneration comprised:

2023
2022
£'000
£'000
Wages and salaries
17,726
32,225
Social security costs
2,062
4,220
Pension costs
2,536
3,180
22,324
39,625
7
Directors' remuneration
2023
2022
£'000
£'000
Remuneration for qualifying services
-
0
609
Amounts receivable under long term incentive schemes
-
0
650
Company pension contributions to defined contribution schemes
-
15
-
0
1,274

The number of Directors for whom retirement benefits are accruing under defined contribution schemes amounted to 0 (2022 - 1).

The number of Directors who are entitled to receive shares under long term incentive schemes during the year was 0 (2022 - 1).

Remuneration disclosed above include the following amounts paid to the highest paid Director:
2023
2022
£'000
£'000
Remuneration for qualifying services
-
609
Long term incentive schemes
-
650
Company pension contributions to defined contribution schemes
-
15
8
Interest receivable and similar income
2023
2022
£'000
£'000
Interest income
Interest on bank deposits
2,754
104
Interest on pension scheme assets
12,710
7,270
Total income
15,464
7,374
CF FERTILISERS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 26 -
9
Interest payable and similar expenses
2023
2022
£'000
£'000
Interest on financial liabilities carried at amortised cost:
Interest payable to group undertakings
-
0
1,160
Interest on lease liabilities
176
6
Interest on other loans
-
0
21
176
1,187
Interest on pension scheme liabilities:
Interest on pension scheme liabilities
13,320
8,310
Total interest expense
13,496
9,497
10
Taxation
2023
2022
£'000
£'000
Current tax
UK corporation tax on profits for the current period
-
9,392
Adjustments in respect of prior periods
(922)
38
Total UK current tax
(922)
9,430
Deferred tax
Origination and reversal of temporary differences
(2,333)
(18,960)
Changes in tax rates
-
3,985
Benefit from previously unrecognised tax loss, credit or temporary difference
-
28
Adjustment in respect of prior periods
4,780
-
0
Current year pension deferred tax charge
-
(412)
2,447
(15,359)
Total tax charge/(credit)
1,525
(5,929)
CF FERTILISERS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
10
Taxation
(Continued)
- 27 -

The charge for the year can be reconciled to the profit/(loss) per the profit and loss account as follows:

2023
2022
£'000
£'000
Profit/(loss) before taxation
32,958
(33,986)
Expected tax charge/(credit) based on a corporation tax rate of 23.50% (2022: 19.00%)
7,745
(6,457)
Income not taxable
(8,667)
(3,524)
Under/(over) provided in prior years
-
39
Deferred tax adjustments in respect of prior years
4,780
4,013
Deferred tax current year
(2,333)
-
Taxation charge/(credit) for the year
1,525
(5,929)

In addition to the amount charged to the profit and loss account, the following amounts relating to tax have been recognised directly in other comprehensive income:

2023
2022
£'000
£'000
Deferred tax arising on:
Actuarial differences recognised as other comprehensive income
(435)
5,174
11
Impairments

Impairment tests have been carried out where appropriate and the following impairment losses have been recognised in profit or loss:

2023
2022
as restated
£'000
£'000
In respect of:
Goodwill
-
0
1,475
Intangible assets
-
0
330
Property, plant and equipment
-
0
104,700
Stocks
-
3,709
Recognised in:
Cost of sales
-
110,214
CF FERTILISERS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 28 -
12
Intangible fixed assets
Goodwill
Software
Patents & licences
Total
£'000
£'000
£'000
£'000
Cost
At 31 December 2022
13,184
260
3,910
17,354
At 31 December 2023
13,184
260
3,910
17,354
Amortisation and impairment
At 31 December 2022
13,184
260
3,910
17,354
At 31 December 2023
13,184
260
3,910
17,354
Carrying amount
At 31 December 2023
-
0
-
0
-
0
-
0
At 31 December 2022
-
0
-
0
-
0
-
0
13
Tangible fixed assets
Freehold buildings
Plant and equipment
Capital
work in
progress
Total
£'000
£'000
£'000
£'000
Cost
At 1 January 2023 (as restated)
18,519
578,763
27,751
625,033
Additions
-
0
10,881
11,224
22,105
Disposals
-
0
(38,509)
(10,211)
(48,720)
Transfers
-
0
10,240
(10,240)
-
0
At 31 December 2023
18,519
561,375
18,524
598,418
Accumulated depreciation and impairment
At 1 January 2023 (as restated)
14,139
519,223
11,501
544,863
Charge for the year
7
6,190
-
0
6,197
Eliminated on disposal
-
0
(38,442)
(9,501)
(47,943)
At 31 December 2023
14,146
486,971
2,000
503,117
Carrying amount
At 31 December 2023
4,373
74,404
16,524
95,301
At 31 December 2022 (as restated)
4,380
59,540
16,250
80,170
The note in relation to the prior year restatement can be found at note 28.
The gross book value of land and buildings includes £3,695,000 (2022: £3,695,000) of land that is not depreciated.
CF FERTILISERS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
13
Tangible fixed assets
(Continued)
- 29 -

Tangible fixed assets includes right-of-use assets, as follows:

Right-of-use assets
2023
2022
£'000
£'000
Net values at the year end
Property
1,158
-
Plant and equipment
1,735
3
Fixtures and fittings
6
29
Motor vehicles
6
60
2,905
92
Total additions in the year
3,429
8
Depreciation charge for the year
Property
102
-
Plant and equipment
437
373
Fixtures and fittings
23
45
Motor vehicles
54
158
616
576
14
Stocks
2023
2022
as restated
£'000
£'000
Raw materials, intermediate, finished stocks and consumables
20,042
44,320
Engineering spares
2,260
3,882
Impairment
(1,469)
(3,709)
20,833
44,493
The note in relation to the prior year restatement can be found at note 28.
15
Debtors
2023
2022
£'000
£'000
Trade debtors
18,799
57,907
Corporation tax recoverable
4,368
129
Prepayments and accrued income
1,616
4,071
24,783
62,107
CF FERTILISERS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 30 -
16
Creditors
Due within one year
Due after one year
2023
2022
2023
2022
Notes
£'000
£'000
£'000
£'000
Creditors
17
19,640
27,115
-
0
-
0
Taxation and social security
2,491
6,676
-
-
Lease liabilities
18
466
104
2,578
28
Deferred income
63
79
138
217
22,660
33,974
2,716
245
17
Creditors
2023
2022
£'000
£'000
Trade creditors
13,542
9,712
Amounts owed to fellow group undertakings
674
2,133
Accruals and deferred income
5,424
15,270
19,640
27,115
18
Lease liabilities
2023
2022
Maturity analysis
£'000
£'000
Within one year
466
104
In two to five years
2,578
28
Total undiscounted liabilities
3,044
132

Lease liabilities are classified based on the amounts that are expected to be settled within the next 12 months and after more than 12 months from the reporting date, as follows:

2023
2022
£'000
£'000
Current liabilities
466
104
Non-current liabilities
2,578
28
3,044
132
2023
2022
Amounts recognised in profit or loss include the following:
£'000
£'000
Interest on lease liabilities
176
6
CF FERTILISERS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 31 -
19
Deferred taxation

The following are the major deferred tax liabilities and assets recognised by the Company and movements thereon during the current and prior reporting period.

Tax losses
Retirement benefit obligations
Total
£'000
£'000
£'000
Liability at 1 January 2022
13,721
-
0
13,721
Asset at 1 January 2022
-
0
(13,928)
(13,928)
Deferred tax movements in prior year
Charge/(credit) to profit or loss
(14,947)
(412)
(15,359)
Charge/(credit) to other comprehensive income
-
5,174
5,174
Effect of change in tax rate - profit or loss
(3,985)
3,985
-
0
Asset at 1 January 2023
(5,211)
(5,181)
(10,392)
Deferred tax movements in current year
Charge/(credit) to profit or loss
(1,809)
4,256
2,447
Charge/(credit) to other comprehensive income
-
(435)
(435)
Asset at 31 December 2023
(7,020)
(1,360)
(8,380)
20
Provisions for liabilities
2023
2022
£'000
£'000
UK restructuring provisions
5,467
6,627
Movements on provisions:
UK restructuring provisions
£'000
At 1 January 2023
6,627
Additional provisions in the year
3,431
Provision released
(4,591)
At 31 December 2023
5,467
CF FERTILISERS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 32 -
21
Retirement benefit schemes
The Company operates both defined contribution and defined benefit pension schemes for all qualifying employees. The main pension schemes are:
1) Kemira GrowHow UK Limited Pension Scheme ("West Scheme"), a hybrid scheme which ceased to accrue on 31 August 2009;
2) Terra Nitrogen (UK) Limited Pension Scheme ("East Scheme"), a hybrid scheme which ceased to accrue in 2003; and
3) CF Fertilisers UK Limited Pension Scheme, a defined contribution scheme
The assets of the schemes are held separately from those of the Company in independently administered funds.
The schemes are subject to the funding legislation outlined in the Pensions Act 2004 which came into force on 30 December 2005. This, together with documents issued by the Pensions Regulator, and Guidance Notes adopted by the Financial Reporting Council, set out the framework for funding defined benefit occupational pension schemes in the UK.
2023
2022
Defined contribution schemes
£'000
£'000
Charge to profit or loss in respect of defined contribution schemes
1,343
2,350

The Board of Trustees of the CF Fertilisers UK Limited Pension Scheme is composed of two employer representatives, two member representatives and one Company appointed independent trustee (the Chair). The Trustees of the scheme are required to act in the best interest of the scheme's beneficiaries. The appointment of the Trustees is determined by the scheme's trust documentation.

Defined benefit schemes

The Board of Trustees of the West and East Schemes are composed of three employer representatives, two member representatives and is chaired by a Company appointed independent trustee. The Trustees of each of the schemes are required to act in the best interest of the schemes’ beneficiaries. The appointment of the Trustees is determined by the schemes’ trust documentation.

The schemes typically expose the Company to actuarial risks such as investment risk, interest rate risk, mortality risk and longevity risk. A decrease in corporate bond yields, a rise in inflation or an increase in life expectancy would result in an increase to scheme liabilities. This would detrimentally impact the balance sheet position and may give rise to increased charges on future profit and loss accounts. This effect would be partially offset by an increase in the value of the schemes’ bond holdings.

With reference to asset volatility, the Trustees utilise an LDI strategy which aims to reduce some of the volatility of the funding level of the fund to gilt yields. The discount rate is set with reference to corporate bonds, and thus some volatility remains. Regarding inflation risk, to better protect the fund’s assets against movements in inflation an LDI strategy providing hedging against movements in RPI was implemented.

The Company’s final salary schemes are subject to triennial valuation by independent actuaries (on the basis of annual valuations on the defined accrued benefits method). The latest valuation was at 31 December 2019, whilst a 31 December 2022 valuation is currently ongoing.

Funding policy

The Company expects to pay £10.8m and £10.3m in contributions to the West and East Schemes in 2024.

CF FERTILISERS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
21
Retirement benefit schemes
(Continued)
- 33 -
2023
2022
Key assumptions
%
%
Discount rate
4.55
4.80
Inflation assumption (RPI)
3.00
3.20
Increase in pensions in payment (RPI)
2.85
2.95
Mortality assumptions
2023
2022

Assumed life expectations on retirement at age 65:

Years
Years
Retiring today
- Males
21.7
22.1
- Females
23.8
24.2
Retiring in 20 years
- Males
23.0
23.4
- Females
25.2
25.7

The assumptions relating to post retirement mortality are as follows:

 

For 2023, S3PA Year of Birth tables with 100%/105% scaling factors for males/females, with CMI 2022 (Sk=7.0, A=0.2%) projections and long term rate of improvement of 1.25% p.a.

 

For 2022, S3PA Year of Birth tables with 102%/105% scaling factors for males/females, with CMI 2021 (Sk=7.0, A=0.3%) projections and long term rate of improvement of 1.25% p.a.

 

The above assumptions apply to both the West and East defined benefit pension schemes.

2023
2022
Amounts recognised in the profit and loss account
£'000
£'000
Net interest on defined benefit liability/(asset)
- West scheme
280
470
- East scheme
330
570
Administration costs and fair value adjustments
- West scheme
632
715
- East scheme
561
506
Total costs
1,803
2,261

Of the total expenses for the year, £1,193k relates to administration expenses, £12,710k to interest receivable and £13,320k to interest payable.

CF FERTILISERS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
21
Retirement benefit schemes
(Continued)
- 34 -
2023
2022
Amounts recognised in other comprehensive income
£'000
£'000
Actuarial changes arising from changes in demographic assumptions
- West scheme
(3,390)
(3,080)
- East scheme
(2,360)
(2,120)
Actuarial changes arising from changes in financial assumptions
- West scheme
3,440
(73,170)
- East scheme
2,520
(73,920)
Actuarial changes arising from experience adjustments
- West scheme
5,060
6,260
- East scheme
300
7,240
Return on plan assets (excluding interest)
- West scheme
(3,507)
61,218
- East scheme
(322)
55,238
Total costs/(income)
1,741
(22,334)

The amounts included in the balance sheet arising from the Company's obligations in respect of defined benefit plans are as follows:

2023
2022
£'000
£'000
Present value of defined benefit obligations
- West scheme
161,340
159,650
- East scheme
126,970
127,430
Fair value of plan assets
- West scheme
(158,667)
(148,992)
- East scheme
(124,201)
(115,701)
Deficit in schemes
5,442
22,387
CF FERTILISERS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
21
Retirement benefit schemes
(Continued)
- 35 -
2023
2022

Movements in the present value of defined benefit obligations

£'000
£'000
At 1 January 2023
- West scheme
159,650
236,380
- East scheme
127,430
200,010
Benefits paid
- West scheme
(10,810)
(11,240)
- East scheme
(6,850)
(7,590)
Actuarial gains and losses
- West scheme
5,110
(69,990)
- East scheme
460
(68,800)
Interest cost
- West scheme
7,390
4,500
- East scheme
5,930
3,810
At 31 December 2023
- West scheme
161,340
159,650
- East scheme
126,970
127,430
2023
2022

Movements in the fair value of plan assets:

£'000
£'000
At 1 January 2023
- West scheme
(148,992)
(207,895)
- East scheme
(115,701)
(166,055)
Interest income
- West scheme
(7,110)
(4,030)
- East scheme
(5,600)
(3,240)
Benefits paid
- West scheme
10,810
11,240
- East scheme
6,850
7,590
Contributions by the employer
- West scheme
(10,500)
(10,240)
- East scheme
(9,990)
(9,740)
Return on plan assets
- West scheme
(2,875)
61,933
- East scheme
240
55,744
At 31 December 2023
- West scheme
(158,667)
(148,992)
- East scheme
(124,201)
(115,701)
CF FERTILISERS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
21
Retirement benefit schemes
(Continued)
- 36 -
Sensitivity of the defined benefit obligations to changes in assumptions
West scheme obligations would have been affected by changes in assumptions as follows:
2023
2022
£'000
£'000
0.5% change in discount rate
- increase
+ 8,520
- 8,770
- decrease
- 9,040
+ 9,570
0.5% change in inflation rate
- increase
- 2,220
+ 3,390
- decrease
+ 2,680
- 3,230
East scheme obligations would have been affected by changes in assumptions as follows:
2023
2022
£'000
£'000
0.5% change in discount rate
- increase
+ 7,720
- 8,220
- decrease
- 8,330
+ 9,090
0.5% change in inflation rate
- increase
- 5,240
+ 6,970
- decrease
+ 4,250
- 6,180

The sensitivity information shown has been prepared using the same method used to adjust the results of the latest funding valuation to the balance sheet date. This is the same approach as has been adopted in previous periods.

 

The fair value of plan assets at the reporting period end was as follows:

West scheme
East scheme
West scheme
East scheme
2023
2023
2022
2022
£'000
£'000
£'000
£'000
Equity instruments
16,962
15,328
16,795
15,240
Property
6,566
6,863
6,120
6,985
Other investment funds
29,014
26,087
29,962
27,275
Bonds and gilts
101,948
65,534
76,784
61,041
Cash
4,177
10,389
19,331
5,160
158,667
124,201
148,992
115,701

Plan assets do not include any of the entity’s own transferable financial instruments or property, or other assets used by the entity. All assets have a quoted market value in an active market.

CF FERTILISERS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 37 -
22
Share-based payments

The Company issues share-based payments to certain employees.

2023
2022
£'000
£'000
Expenses
Related to equity settled share based payments
365
595

Share based payments account for the annual movements in other reserves.

23
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£'000
£'000
Authorised
Ordinary shares of £1 each
26,000,000
26,000,000
26,000
26,000
Issued and fully paid
Ordinary shares of £1 each
13,594,316
13,594,316
13,594
13,594
24
Capital commitments
2023
2022
£'000
£'000

At 31 December 2023 the Company had capital commitments as follows:

Contracted for but not provided in the financial statements:
Acquisition of tangible fixed assets
11,541
13,340
25
Related party transactions

The Company has taken advantage of the exemption available within FRS 101.8(k) that allows it not to disclose transactions with other companies in the CF Industries Holdings, Inc. group of companies for the year.

26
Controlling party

The immediate parent company is CF Industries (UK) Limited, a company incorporated in the United Kingdom.

The ultimate controlling party is CF Industries Holdings, Inc., 2375 Waterview Drive, Northbrook, Illinois, USA.

The largest group in which the results of the Company are consolidated is headed by CF Industries Holdings, Inc. No other group financial statement includes the results of the Company. The consolidated financial statements of CF Industries Holdings, Inc. can be obtained from the Company website https://www.cfindustries.com/.

CF FERTILISERS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 38 -
27
Restructuring costs
Costs attributable to the closure of the Ince complex, suspension of ammonia production at the Billingham complex, and associated employee restructuring costs.
Cost of sales
2023
2022
£'000
£'000
Impairments
Intangible fixed assets
-
1,805
Tangible fixed assets
-
104,700
Stocks
-
3,709
Total impairments
-
110,214
Decomissioning & decontamination costs
712
11,179
Total restructuring costs in cost of sales
712
121,393
Impairment triggering events occurred at May 2022 following announcement of permanent closure of the Ince complex; and at August 2022 on suspension of ammonia production at the Billingham complex.
Administrative expenses
2023
2022
£'000
£'000
Severance and payment in lieu of notice
1,485
10,477
Restructuring costs
1,231
1,567
Employment taxes
-
517
Consultancy
-
119
Total restructuring costs in administrative expenses
2,716
12,680
CF FERTILISERS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 39 -
28
Prior period adjustment

Prior period adjustment relates to a reallocation of long term spares stock impairment from stocks to tangible fixed assets.

In addition to below, a further prior year restatement relates to tangible fixed assets to adjust the brought forward balances of plant and equipment and capital work in progress cost and depreciation. The impact on NBV of this adjustment is £Nil.

 

The presentation of deferred tax assets and provisions has been altered on the face of the balance sheet. This has an impact on non-current assets, current assets and net current assets compared to the prior year filed accounts.

 

The prior period adjustment per note 5 is a reclassification of depreciation so that disclosure is consistent with the current year.

Changes to the balance sheet
At 31 December 2022
Previously reported
Adjustment
As restated
£'000
£'000
£'000
Fixed assets
Tangible fixed assets
88,867
(8,697)
80,170
Current assets
Stocks
35,796
8,697
44,493
Net assets
197,545
-
197,545
Capital and reserves
Total equity
197,545
-
197,545
2023-12-312023-01-01Mrs Susan MenzelMr Ashraf MalikMr Bert FrostMr Douglas BarnardMr Christopher BohnMr Brett NightingalefalseCCH SoftwareiXBRL Review & Tag 2022.2034556902023-01-012023-12-3103455690bus:Director12023-01-012023-12-3103455690bus:Director22023-01-012023-12-3103455690bus:Director32023-01-012023-12-3103455690bus:Director52023-01-012023-12-3103455690bus:Director62023-01-012023-12-3103455690bus:Director42023-01-012023-12-3103455690bus:RegisteredOffice2023-01-012023-12-3103455690bus:Agent12023-01-012023-12-3103455690bus:Agent22023-01-012023-12-31034556902023-12-31034556902022-01-012022-12-3103455690core:ContinuingOperations2023-01-012023-12-3103455690core:RetainedEarningsAccumulatedLosses2023-01-012023-12-3103455690core:RetainedEarningsAccumulatedLosses2022-01-012022-12-31034556902022-12-3103455690core:ShareCapital2023-12-3103455690core:ShareCapital2022-12-3103455690core:SharePremium2023-12-3103455690core:SharePremium2022-12-3103455690core:RetainedEarningsAccumulatedLosses2023-12-3103455690core:RetainedEarningsAccumulatedLosses2022-12-3103455690core:ShareCapital2021-12-3103455690core:SharePremium2021-12-3103455690core:RetainedEarningsAccumulatedLosses2021-12-31034556902021-12-3103455690core:UKTax2023-01-012023-12-3103455690core:UKTax2022-01-012022-12-3103455690core:Goodwill2022-01-012022-12-3103455690core:Goodwill2022-12-3103455690core:ComputerSoftware2022-12-3103455690core:CopyrightsPatentsTrademarksServiceOperatingRights2022-12-3103455690core:Goodwill2023-12-3103455690core:ComputerSoftware2023-12-3103455690core:CopyrightsPatentsTrademarksServiceOperatingRights2023-12-3103455690core:Goodwill2022-12-3103455690core:ComputerSoftware2022-12-3103455690core:CopyrightsPatentsTrademarksServiceOperatingRights2022-12-31034556902022-12-3103455690core:Goodwillcore:ContinuingOperations2023-12-3103455690core:Goodwillcore:ContinuingOperations2022-12-3103455690core:LandBuildingscore:OwnedOrFreeholdAssets2022-12-3103455690core:PlantMachinery2022-12-3103455690core:Non-standardPPEClass1ComponentTotalPropertyPlantEquipment2022-12-3103455690core:LandBuildingscore:OwnedOrFreeholdAssets2023-12-3103455690core:PlantMachinery2023-12-3103455690core:Non-standardPPEClass1ComponentTotalPropertyPlantEquipment2023-12-3103455690core:LandBuildingscore:OwnedOrFreeholdAssets2023-01-012023-12-3103455690core:PlantMachinery2023-01-012023-12-3103455690core:Non-standardPPEClass1ComponentTotalPropertyPlantEquipment2023-01-012023-12-3103455690core:ContinuingOperations2023-12-3103455690core:LandBuildingscore:OwnedOrFreeholdAssets2022-12-3103455690core:PlantMachinery2022-12-3103455690core:Non-standardPPEClass1ComponentTotalPropertyPlantEquipment2022-12-3103455690core:CurrentFinancialInstruments2023-12-3103455690core:CurrentFinancialInstruments2022-12-3103455690core:WithinOneYear2023-12-3103455690core:WithinOneYear2022-12-3103455690core:AfterOneYear2023-12-3103455690core:AfterOneYear2022-12-3103455690core:RetirementBenefitObligationsDeferredTax2021-12-3103455690core:TaxLossesCarry-forwardsDeferredTax2021-12-3103455690core:TaxLossesCarry-forwardsDeferredTax2022-12-3103455690core:RetirementBenefitObligationsDeferredTax2022-12-3103455690core:TaxLossesCarry-forwardsDeferredTax2023-12-3103455690core:RetirementBenefitObligationsDeferredTax2023-12-3103455690bus:PrivateLimitedCompanyLtd2023-01-012023-12-3103455690bus:FRS1012023-01-012023-12-3103455690bus:Audited2023-01-012023-12-3103455690bus:FullAccounts2023-01-012023-12-31xbrli:purexbrli:sharesiso4217:GBP