Company registration number 01879474 (England and Wales)
PAXTON ACCESS LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
PAXTON ACCESS LIMITED
COMPANY INFORMATION
Directors
A Stroud
P Bannister
G O'Hara
P Rawlinson
N O'Donnell
S Brotherton-Ratcliffe
S Taylor
(Appointed 6 February 2023)
B Bowen
(Appointed 1 January 2024)
A Clements
(Appointed 1 January 2024)
Secretary
A Clements
Company number
01879474
Registered office
Paxton House
Home Farm Road
Brighton
East Sussex
BN1 9HU
Auditor
Humphrey & Co Audit Services Ltd
7-9 The Avenue
Eastbourne
East Sussex
BN21 3YA
Business address
Paxton House
Home Farm Road
Brighton
East Sussex
BN1 9HU
Bankers
HSBC Bank plc
153 North Street
Brighton
East Sussex
BN1 1SW
PAXTON ACCESS LIMITED
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3 - 6
Directors' responsibilities statement
7
Independent auditor's report
8 - 10
Statement of comprehensive income
11
Statement of financial position
12
Statement of changes in equity
13
Statement of cash flows
14
Notes to the financial statements
15 - 30
PAXTON ACCESS LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -
The directors present the strategic report and financial statements for the year ended 31 December 2023.
Fair review of the business
Following a challenging 2022, 2023 has been a very successful year for Paxton Access Limited (Paxton).
In brief, the company grew during the year, with turnover increasing by 7.4% (2022: 10.1%) and gross profit by 17.9% (2022: 1.9%). At the same time administrative expenses increased by 3.9% (2022: 23.3%) and net profit for the year before tax ended up at £4,320,858 (2022: £160,141). The company's net worth at the end of the year was £28,874,250 (2022: £24,621,392).
Paxton operates in a highly competitive market. In order to maintain and improve its position in this market substantial investment has continued to be made by the company in Research and Development. This investment goes to improving existing products and creating new innovative products for the market with a focus on providing returns over the longer term.
The company did not enter any new markets in the year, instead looking to cultivate the overseas markets already entered into, with particular focus on the US.
Environmental matters
The company is committed to being environmentally responsible and has shown this in achieving the ISO 14001:2015 accreditation for its manufacturing facility in Eastbourne (originally in February 2018) and passing the audit for this in the past five years. The company continuously reviews its policies and capital to see where environmental improvements can be made and has installed charge-points for plug in hybrid cars to encourage the use of low emission vehicles. As well as this, Paxton has a cross company environmental group to track and report on environmental initiatives. As part of the design and build process of our new Electronics Centre we installed 96,400w solar panels to the roof of the building to help reduce our emissions.
Social and community issues
The company takes social and community issues seriously and has arranged multiple charity days through the year to generate donation income for selected charities.
Principal risks and uncertainties
The company's business is partly speculative, in that it is not known which new products will succeed, even though sales trends for existing products are known. The Directors cannot give any undertaking as to the success or otherwise of new products yielded by its research and development work. There is therefore a significant risk inherent with expenditure related to this.
The Directors are not privy to new products currently in development by the company's competitors; there is therefore a risk that sales of its own products may suffer in the future as a result of unknown improvements in competitors' products.
The company is typical of many companies of its type in that it is heavily reliant on IT systems. Whilst the Directors diligently review and improve measures for ensuring resilience of its systems and back up of its data, they cannot absolutely ensure that failures will not damage the company's business at some point. In order to mitigate this risk the company continues to invest heavily in its IT infrastructure.
Sales to Paxton customers are made on a credit basis. Trade debtors amount to a substantial sum. Mindful of the current credit conditions affecting all companies, including our customers, there is an increased awareness regarding the importance of adherence to our credit terms. The Board has satisfied itself that its customers are financially sound and will continue to be able to fund their debt for the foreseeable future. There is continued focus on strong credit management to ensure timely payment from customers and a healthy corporate liquidity position.
As a company with a global presence, we are aware of the risk posed by worldwide geo-political instability. To mitigate this, we always take this under consideration whenever looking to expand into new markets and when sourcing new materials, as well as keeping our current positions under ongoing review.
PAXTON ACCESS LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
Section 172 Statement
Duty to promote the success of the company
The Directors consider the successful running of Paxton in terms of achieving its long-term strategy which centres on building a resilient company that is great to work for and known for the quality of our products. The ongoing success of Paxton centres around positively engaging all stakeholders of the company. The Directors remain mindful of the long term consequences of key commercial decisions and determined that these were in the interests of the company’s owner, employees, agency staff, contractors, customers, installers, suppliers and local community.
The principal decisions made in the year were:
Invest in a new Surface Mount Technology (SMT) line to work in parallel with our current line to provide both resilience and greater production efficiency.
Open a new state of the art Paxton Electronics Centre, housing our two SMT lines next door to our Paxton Technology Centre in Brighton. Encouraging inter-departmental collaboration whilst providing the capacity for future growth.
Renewed focus on our impact to the environment through our cross departmental Paxton Green Team, including engaging a consultant to track and plan for how we can reduce our carbon footprint.
Breaking ground on a joint project to build a bespoke office and factory space in Greenville, SC, to facilitate our growth in the US, with a planned opening for Summer 2024.
Following the stabilisation of the electronic component market, making a concerted effort to reduce stock holding whilst providing the same service to our distribution network and installers worldwide.
As set out in the Directors’ report, the company takes employee involvement very seriously and we ensure we engage with our teams at all levels on a wide range of matters. The company regularly engages with its distributors, installers, and suppliers to seek feedback and maintain these important relationships.
The Directors confirm that throughout the year they have acted in the way they consider in good faith, to be most likely to promote the continued success of Paxton for the benefit of its members.
A Stroud
Director
30 April 2024
PAXTON ACCESS LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -
The directors present their annual report and financial statements for the year ended 31 December 2023.
Principal activities
The principal activity of the company is the manufacture and distribution of electronic access control systems.
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 unless otherwise stated were as follows:
A Stroud
P Bannister
G O'Hara
P Rawlinson
N O'Donnell
S Brotherton-Ratcliffe
S Taylor
(Appointed 6 February 2023)
B Bowen
(Appointed 1 January 2024)
A Clements
(Appointed 1 January 2024)
Financial instruments
Treasury operations and financial instruments
The company operates a treasury function which is responsible for managing the liquidity, interest and foreign currency risks associated with the company’s activities.
The company’s principal financial instruments are cash balances. In addition, the company has various other financial assets and liabilities such as trade debtors and creditors arising directly from its operations.
Interest rate risk
Interest rate risk arises from cash balances, bank overdrafts and loans. The directors continually review the company's exposure to interest rates and take action to ensure that the risk is appropriate in relation to the financial results of the company.
Foreign currency risk
The company’s principal foreign currency exposures arise from trading with overseas companies. Dollar and Euro bank accounts are maintained in order to try and mitigate foreign currency risk.
Credit risk
The company has implemented policies that require appropriate credit checks on potential customers before sales are made. In addition the company has insured its risk of debtor irrecoverability.
Research and development
The company is heavily committed to research and development activities. During the year the company concentrated its research and development activities on both continuous improvement on its current product portfolio as well as diversification into other market sectors.
PAXTON ACCESS LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 4 -
Disabled persons
Applications for employment by disabled persons are always fully considered, bearing in mind the aptitudes of the applicant concerned. In the event of members of staff becoming disabled, every effort is made to ensure that their employment within the company continues and that the appropriate training is arranged. It is the policy of the company that the training, career development and promotion of disabled persons should, as far as possible, be identical to that of other employees.
Employee involvement
Paxton is conscious of the need to keep employees informed regarding the progress and future plans of the company and the mutual benefit that can be engendered by good internal communications. This is achieved through regular meetings with managers and employees and an open forum in which a two-way flow of comment and ideas is encouraged. An example of this is the Paxton Exchange which offers senior management facetime with the whole company, and therefore the opportunity to communicate company goals and achievements as well as any challenges faced. A significant amount of time and money is invested in employee training in the company and is available to everyone. The Paxton Seagull, our employee magazine, is a further commitment to improving communications within the company. This is complimented by a fortnightly Paxton E-gull, emailed to all employees. The company is committed to providing a fantastic company culture for all its staff members.
Business relationships
The directors consider the fostering of good relationships with all stakeholders as essential for the ongoing success of the company. In that regard they have always considered the impact on the suppliers, customers, end users, staff and others of all decisions made. Key decisions, and their impact on specific groups, have been summarised in the s172 statement included on both our website and in the strategic report.
Future developments
The company is continuing to develop its overseas marketing and sales strategy and the directors expect that this will contribute to an increase in profitability.
Auditor
The auditor, Humphrey & Co Audit Services Ltd, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
PAXTON ACCESS LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 5 -
Energy and Greenhouse Gas report
Paxton Access Limited has appointed Carbon Footprint Ltd, a leading carbon and energy management company, to independently assess its Greenhouse Gas (GHG) emissions in accordance with the UK Government's ‘Environmental Reporting Guidelines: Including Streamlined Energy and Carbon Reporting Guidance'.
The GHG emissions have been assessed following the ISO 14064-1:2018 standard and has used the 2022 emission conversion factors published by Department for Environment, Food and Rural Affairs (Defra) and the Department for Business, Energy & Industrial Strategy (BEIS). The assessment follows the dual reporting approach for assessing Scope 2 emissions from electricity usage. The financial control approach has been used.
The table below summarises the GHG emissions for reporting year: 1st January 2022 to 31st December 2023.
Location-Based (tCO₂e)
Market-Based (tCO₂e)
Scope
Emission Source
1
Natural Gas
25.79
25.79
1
Company vehicles
18.93
18.93
2
Electricity
194.54
364.61
2
Company vehicles off-site charging
3.03
3.03
3.6
Cash Opt Out
70.45
70.45
3.6
Grey Fleet (employee-owned vehicles)
16.39
16.39
All
Total tCO₂e
329.13
499.20
All
Total tCO₂e per employee (FTE)
0.99
1.50
All
Total tCO₂e per £M turnover
5.36
8.13
Measures taken during 2023 to improve energy efficiency:
• 96,400w solar panels installed (456m²).
• We have moved 98% of our fleet cars to fully electric.
• Installed 6 car charging facilities across Brighton and Eastbourne.
• Replaced 100% warehouse high beam lighting to LED.
• VRF system installed at our electronic centre. Heat pump technology to heat our hot water.
• Green policy launched.
• Taken on a carbon consultant Carbon Footprint to help us calculate and reduce our Scope 1&2 emissions.
Activity
2023
2022
Total energy consumed (kWh)
1,224,474
1,210,448
Total Gross Location-Based Emissions (tCO₂e)
329.13
282.21
Total Gross Market-Based Emissions (tCO₂e)
499.20
*
Total Net Market-Based Emissions (tCO₂e)
499.20
*
Intensity ratio: tCO₂e (gross market-based) per employee
1.50
*
Intensity ratio: tCO₂e (gross market-based) per £M turnover
8.13
*
* it was not practical to prepare comparative data.
PAXTON ACCESS LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 6 -
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.
On behalf of the board
A Stroud
Director
30 April 2024
PAXTON ACCESS 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:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
state whether applicable UK 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.
PAXTON ACCESS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF PAXTON ACCESS LIMITED
- 8 -
Opinion
We have audited the financial statements of Paxton Access Limited (the 'company') for the year ended 31 December 2023 which comprise the statement of comprehensive income, the statement of financial position, the statement of changes in equity, the statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
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.
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.
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:
the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
PAXTON ACCESS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF PAXTON ACCESS 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:
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 remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
Extent to which the audit was considered capable of detecting irregularities, including fraud
We obtained an understanding of the company and the laws and regulations that could reasonably be expected to have a direct effect on the financial statements through discussion with the directors and management and the application of our knowledge and experience. We discussed with management whether there were any known or suspected instances of fraud and/or non-compliance with relevant laws and regulations. We also obtained an understanding of the company's accounting systems and internal controls.
We audited the risk of management override of controls, by testing journal entries and other adjustments for appropriateness, and evaluating the business rationale of significant transactions outside the normal course of business. Our other audit procedures included, but were not limited to, attending a year end stock count, carrying out detailed substantive testing of a sample of income and expenditure transactions arising in the year and a sample of balance sheet items such as fixed assets, debtors, creditors, etc. We also reviewed the financial statements and checked disclosures to supporting documentation to assess compliance with applicable law and regulation.
Because of the inherent risk 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. The risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements as we will be less likely to become aware of instances of non-compliance. The risk is greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion omission or misrepresentation.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
PAXTON ACCESS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF PAXTON ACCESS LIMITED
- 10 -
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.
Mr Michael Macefield
Senior Statutory Auditor
For and on behalf of Humphrey & Co Audit Services Ltd
30 April 2024
Chartered Accountants
Statutory Auditor
7-9 The Avenue
Eastbourne
East Sussex
BN21 3YA
PAXTON ACCESS LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
- 11 -
2023
2022
Notes
£
£
Turnover
3
65,957,032
61,402,381
Cost of sales
(29,208,606)
(30,235,306)
Gross profit
36,748,426
31,167,075
Administrative expenses
(34,100,942)
(32,830,690)
Other operating income
2,219,422
1,863,237
Operating profit
4
4,866,906
199,622
Interest payable and similar expenses
8
(546,048)
(39,481)
Profit before taxation
4,320,858
160,141
Tax on profit
9
(68,000)
875,000
Profit for the financial year
4,252,858
1,035,141
The income statement has been prepared on the basis that all operations are continuing operations.
PAXTON ACCESS LIMITED
STATEMENT OF FINANCIAL POSITION
AS AT
31 DECEMBER 2023
31 December 2023
- 12 -
2023
2022
Notes
£
£
£
£
Fixed assets
Intangible assets
10
119,348
203,985
Tangible assets
11
3,119,307
1,967,170
3,238,655
2,171,155
Current assets
Stocks
12
8,644,367
10,990,868
Debtors falling due after more than one year
13
2,714,000
2,782,000
Debtors falling due within one year
13
26,112,653
24,694,080
Cash at bank and in hand
2,516,231
401,722
39,987,251
38,868,670
Creditors: amounts falling due within one year
14
(13,002,133)
(16,183,433)
Net current assets
26,985,118
22,685,237
Total assets less current liabilities
30,223,773
24,856,392
Creditors: amounts falling due after more than one year
15
(864,523)
Provisions for liabilities
Provisions
18
485,000
235,000
(485,000)
(235,000)
Net assets
28,874,250
24,621,392
Capital and reserves
Called up share capital
21
200,001
200,001
Profit and loss reserves
28,674,249
24,421,391
Total equity
28,874,250
24,621,392
The financial statements were approved by the board of directors and authorised for issue on 30 April 2024 and are signed on its behalf by:
A Stroud
Director
Company registration number 01879474 (England and Wales)
PAXTON ACCESS LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 13 -
Share capital
Profit and loss reserves
Total
£
£
£
Balance at 1 January 2022
200,001
23,386,250
23,586,251
Year ended 31 December 2022:
Profit and total comprehensive income
-
1,035,141
1,035,141
Balance at 31 December 2022
200,001
24,421,391
24,621,392
Year ended 31 December 2023:
Profit and total comprehensive income
-
4,252,858
4,252,858
Balance at 31 December 2023
200,001
28,674,249
28,874,250
PAXTON ACCESS LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 14 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from/(absorbed by) operations
26
3,768,030
(5,719,340)
Interest paid
(546,048)
(39,481)
Net cash inflow/(outflow) from operating activities
3,221,982
(5,758,821)
Investing activities
Purchase of intangible assets
(6,204)
(109,791)
Purchase of tangible fixed assets
(649,370)
(758,965)
Proceeds from disposal of tangible fixed assets
76,365
1,200
Net cash used in investing activities
(579,209)
(867,556)
Financing activities
Proceeds from new invoice discounting facility
2,863,780
Payment of finance leases obligations
(704,087)
(281,453)
Net cash generated from/(used in) financing activities
2,159,693
(281,453)
Net increase/(decrease) in cash and cash equivalents
4,802,466
(6,907,830)
Cash and cash equivalents at beginning of year
(2,267,825)
4,621,232
Effect of foreign exchange rates
(18,410)
18,773
Cash and cash equivalents at end of year
2,516,231
(2,267,825)
Relating to:
Cash at bank and in hand
2,516,231
401,722
Bank overdrafts included in creditors payable within one year
(2,669,547)
PAXTON ACCESS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 15 -
1
Accounting policies
Company information
Paxton Access Limited is a private company limited by shares incorporated in England and Wales. The registered office is Paxton House, Home Farm Road, Brighton, East Sussex, BN1 9HU.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
1.2
Going concern
The company benefits from the support of its owners and financial resilience developed through working with key managerial stakeholders. Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
1.3
Turnover
Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.
When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.
1.4
Research and development expenditure
Research expenditure is written off against profits in the year in which it is incurred. Identifiable development expenditure is capitalised to the extent that the technical, commercial and financial feasibility can be demonstrated.
1.5
Intangible fixed 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.
Intangible assets comprise of product development costs. Such assets are considered to have a finite useful life and the costs are amortised on a reducing balance basis over their estimated useful life. Intangible assets are stated at cost less amortisation and are reviewed for impairment whenever there is an indication that the carrying value may be impaired.
PAXTON ACCESS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 16 -
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:
Development Costs
33% reducing balance and 33% straight line
1.6
Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Freehold
No depreciation
Leasehold improvements
20% reducing balance and 20%/33% straight line
Plant and machinery
20%/33% reducing balance and 20%/33% straight line
Fixtures, fittings & equipment
20% reducing balance & 20%/25%/33% straight line
Motor vehicles
33% straight line
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
1.7
Impairment of fixed assets
At each reporting period end date, the company reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). 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.
1.8
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. 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.
Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.
The cost of stock is based on an average cost basis, where the actual cost of stock purchased to obtain the quantity held is identified and an average cost calculated.
At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.
PAXTON ACCESS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 17 -
1.9
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.10
Financial instruments
Financial instruments are recognised in the company's statement of financial position when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Other financial assets
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
Trade debtors, loans and other receivables that have fixed or determinable payments that are not quoted in an active market are classified as 'loans and receivables'. Loans and receivables are measured at amortised cost using the effective interest method, less any impairment.
Impairment of financial assets
Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
PAXTON ACCESS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 18 -
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
Basic financial liabilities
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
1.11
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
1.12
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 income statement 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.
PAXTON ACCESS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 19 -
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the income statement, 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.
1.13
Provisions
Provisions are recognised when the company has a legal or constructive present obligation as a result of a past event, 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 the effect of the time value of money is material, the amount expected to be required to settle the obligation is recognised at present value. When a provision is measured at present value, the unwinding of the discount is recognised as a finance cost in profit or loss in the period in which it arises.
1.14
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
1.15
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.16
Leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.
Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the statement of financial position as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.
Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.
PAXTON ACCESS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 20 -
Assets obtained under hire purchase contracts and finance leases are capitalised as tangible assets and depreciated over the shorter of the lease term and their useful lives. Obligations under such agreements are included in creditors net of the finance charge allocated to future periods. The finance element of the rental payment is charged to the profit and loss account so as to produce a constant periodic rate of charge on the net obligation in each period.
1.17
Foreign exchange
Monetary assets and liabilities denominated in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are recorded at a fixed rate that is used as an approximation for the actual rate. The fixed rates used are reviewed periodically. All differences are taken to profit and loss account.
2
Judgements and key sources of estimation uncertainty
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 where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
Critical judgements
The critical judgments which have the most significant impact on amounts recognised in the financial statements are as follows:
Stock provisioning
Provision is made where necessary for obsolete, slow moving and defective stocks. The directors review the level of the provision based on the level and condition of stock items and their knowledge of the business.
Warranty provisioning
The company provides a 5 year warranty on its products. A provision for expected warranty claims is calculated based on prior experience of levels of warranty claims incurred and future expectations.
Useful life of fixed assets
The directors estimate the expected useful lives of the company's fixed assets which in turn impacts on the amount of depreciation charged in the year.
Deferred tax asset
The directors estimate the amount of deferred tax that is likely to be recovered by the likely availability of future taxable profits.
Key sources of estimation uncertainty
In the opinion of the directors there are no estimates or assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities within the next financial year.
PAXTON ACCESS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 21 -
3
Turnover
An analysis of the company's turnover is as follows:
2023
2022
£
£
Turnover analysed by class of business
Electronic access control systems
65,957,032
61,402,381
2023
2022
£
£
Turnover analysed by geographical market
UK
42,773,938
38,260,866
Europe
9,286,406
10,006,711
Rest of world
13,896,688
13,134,804
65,957,032
61,402,381
4
Operating profit
2023
2022
Operating profit for the year is stated after charging/(crediting):
£
£
Exchange differences apart from those arising on financial instruments measured at fair value through profit or loss
(28,728)
(148,579)
Research and development costs
701,915
819,924
Management fees receivable
(1,957,105)
(1,604,358)
Compensation for faulty goods
(134,049)
(163,566)
Depreciation of owned tangible fixed assets
688,613
497,668
Depreciation of tangible fixed assets held under finance leases
94,937
92,388
(Profit)/loss on disposal of tangible fixed assets
(1,627)
158
Amortisation of intangible assets
90,841
117,704
Operating lease charges
392,659
317,351
5
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the company
32,000
30,500
For other services
Taxation compliance services
2,750
2,500
All other non-audit services
3,250
3,000
6,000
5,500
PAXTON ACCESS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 22 -
6
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Administration
255
255
Production
74
74
Cleaning
2
2
Total
331
331
Their aggregate remuneration comprised:
2023
2022
£
£
Wages and salaries
15,547,238
14,620,691
Social security costs
1,693,675
1,651,003
Pension costs
804,944
1,218,382
18,045,857
17,490,076
7
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
2,067,009
2,443,358
Company pension contributions to defined contribution schemes
86,372
145,901
2,153,381
2,589,259
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 7 (2022 - 7).
Remuneration disclosed above include the following amounts paid to the highest paid director:
2023
2022
£
£
Remuneration for qualifying services
552,523
749,702
Company pension contributions to defined contribution schemes
17,658
17,483
PAXTON ACCESS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 23 -
8
Interest payable and similar expenses
2023
2022
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
411,989
-
Other interest on financial liabilities
82,385
26,311
494,374
26,311
Other finance costs:
Interest on finance leases and hire purchase contracts
51,674
13,170
546,048
39,481
9
Taxation
2023
2022
£
£
Deferred tax
Origination and reversal of timing differences
443,653
(875,000)
Adjustment in respect of prior periods
(375,653)
Total deferred tax
68,000
(875,000)
The standard rate of corporation tax in the UK increased from 19% to 25% on 1 April 2023. The average rate for the year was 23.5%.
The actual charge/(credit) for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:
2023
2022
£
£
Profit before taxation
4,320,858
160,141
Expected tax charge based on the standard rate of corporation tax in the UK of 23.50% (2022: 19.00%)
1,015,402
30,427
Tax effect of expenses that are not deductible in determining taxable profit
23,116
8,310
Effect of change in corporation tax rate
(386,677)
Permanent capital allowances in excess of depreciation
(33,678)
Research and development tax credit
(594,865)
(493,382)
Under/(over) provided in prior years
(375,653)
Taxation charge/(credit) for the year
68,000
(875,000)
PAXTON ACCESS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 24 -
10
Intangible fixed assets
Development Costs
£
Cost
At 1 January 2023
818,468
Additions - internally developed
6,204
At 31 December 2023
824,672
Amortisation and impairment
At 1 January 2023
614,483
Amortisation charged for the year
90,841
At 31 December 2023
705,324
Carrying amount
At 31 December 2023
119,348
At 31 December 2022
203,985
11
Tangible fixed assets
Freehold
Leasehold improvements
Plant and machinery
Fixtures, fittings & equipment
Motor vehicles
Total
£
£
£
£
£
£
Cost
At 1 January 2023
5,000
1,000,166
4,517,332
2,239,432
7,761,930
Additions
63,033
1,820,908
99,485
26,999
2,010,425
Disposals
(243,042)
(243,042)
At 31 December 2023
5,000
1,063,199
6,095,198
2,338,917
26,999
9,529,313
Depreciation and impairment
At 1 January 2023
676,897
3,244,188
1,873,675
5,794,760
Depreciation charged in the year
105,368
498,503
173,679
6,000
783,550
Eliminated in respect of disposals
(168,304)
(168,304)
At 31 December 2023
782,265
3,574,387
2,047,354
6,000
6,410,006
Carrying amount
At 31 December 2023
5,000
280,934
2,520,811
291,563
20,999
3,119,307
At 31 December 2022
5,000
323,269
1,273,144
365,757
1,967,170
PAXTON ACCESS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
11
Tangible fixed assets
(Continued)
- 25 -
The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.
2023
2022
£
£
Plant and machinery
1,245,119
369,553
Motor vehicles
20,999
1,266,118
369,553
12
Stocks
2023
2022
£
£
Raw materials and consumables
279,264
141,715
Finished goods and goods for resale
8,365,103
10,849,153
8,644,367
10,990,868
13
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
13,921,527
13,349,281
Amounts owed by group undertakings
10,240,380
8,051,905
Other debtors
11,971
12,538
Prepayments and accrued income
1,938,775
3,280,356
26,112,653
24,694,080
2023
2022
Amounts falling due after more than one year:
£
£
Deferred tax asset (note 19)
2,714,000
2,782,000
Total debtors
28,826,653
27,476,080
Trade debtors disclosed above are measured at amortised cost.
Amounts owed by group undertakings are interest free and have no set repayment date and are therefore considered repayable on demand.
PAXTON ACCESS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 26 -
14
Creditors: amounts falling due within one year
2023
2022
Notes
£
£
Bank loans and overdrafts
16
2,863,780
2,669,547
Obligations under finance leases
17
297,206
232,649
Trade creditors
6,881,003
10,866,587
Amounts owed to group undertakings
24,143
457,775
Taxation and social security
1,765,411
892,768
Accruals and deferred income
1,170,590
1,064,107
13,002,133
16,183,433
Amounts owed to group undertakings are interest free and have no set repayment date and are therefore considered repayable on demand.
Included within bank loans and overdrafts is an amount of £2,863,780 (2022: £nil) in respect of the company’s invoice discounting facility. This amount is secured by fixed and floating charges over the company’s assets.
15
Creditors: amounts falling due after more than one year
2023
2022
Notes
£
£
Obligations under finance leases
17
864,523
16
Loans and overdrafts
2023
2022
£
£
Invoice discounting facility
2,863,780
Bank overdrafts
2,669,547
2,863,780
2,669,547
Payable within one year
2,863,780
2,669,547
17
Finance lease obligations
2023
2022
Future minimum lease payments due under finance leases:
£
£
Within one year
297,206
232,649
In two to five years
864,523
1,161,729
232,649
PAXTON ACCESS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
17
Finance lease obligations
(Continued)
- 27 -
Finance lease payments represent rentals payable by the company for certain items of plant and machinery and motor vehicles. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is 60 months. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.
18
Provisions for liabilities
2023
2022
£
£
Warranty repairs
485,000
235,000
Movements on provisions:
Warranty repairs
£
At 1 January 2023
235,000
Additional provisions in the year
250,000
At 31 December 2023
485,000
The provision for warranty claims is a provision for future product costs arising in the normal course of business from prior year sales. The company provides a 5 year warranty on its products.
19
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:
Assets
Assets
2023
2022
Balances:
£
£
Accelerated capital allowances
(63,000)
-
Tax losses
2,777,000
2,782,000
2,714,000
2,782,000
2023
Movements in the year:
£
Asset at 1 January 2023
(2,782,000)
Charge to profit or loss
68,000
Asset at 31 December 2023
(2,714,000)
PAXTON ACCESS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
19
Deferred taxation
(Continued)
- 28 -
Deferred tax assets and liabilities are offset where the company has a legally enforceable right to do so. It is estimated that approximately £625,000 of the deferred tax asset will reverse in the next 12 months.
Deferred tax balances have been measured at 25%.
20
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
804,944
1,218,382
The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.
At the Balance Sheet date the company had a pension liability of £150,285 (2022 - £143,723).
21
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
200,001
200,001
200,001
200,001
The holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled to one vote per share at meetings of the company. All ordinary shares rank equally with regard to the company's residual assets.
22
Operating lease commitments
Lessee
Operating lease payments consist of rentals payable by the company for motor vehicles, software and equipment. Motor vehicle leases are generally for a term of 3 years. Software and equipment leases are generally for a term of 5 years.
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
2023
2022
£
£
Within one year
527,106
361,558
Between two and five years
847,604
439,275
1,374,710
800,833
PAXTON ACCESS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 29 -
23
Capital commitments
Amounts contracted for but not provided in the financial statements:
2023
2022
£
£
Acquisition of tangible fixed assets
152,107
664,831
The company has commitments of £152,107 (2022 - £664,831) for property, plant and equipment, which are contracted for but not provided for in the Financial Statements.
24
Related party transactions
Guarantees
The company has entered into an unlimited cross guarantee with other group companies such that it will guarantee the lending of those other group companies should they be unable to meet their liabilities as and when they fall due. At 31 December 2023 the maximum potential exposure was £9,768,527 (2022 - £8,804,616). The company has also provided a guarantee of £300,000 to H M Revenue & Customs. No liability is expected to arise as a result of these arrangements.
The company has taken advantage of the exemption in Financial Reporting Standard 102 from disclosing transactions with other wholly owned subsidiaries of Paxton Access Group Limited.
25
Ultimate controlling party
The parent company of Paxton Access Limited is Paxton Access Group Limited, a company incorporated in England and Wales and whose registered office is Paxton House, Home Farm Road, Brighton, BN1 9HU.
The ultimate controlling party is A Brotherton-Ratcliffe, a former director of the company.
Paxton Access Group Limited is the parent undertaking of the largest and smallest group to consolidate these financial statements. Copies of the accounts can be obtained from Companies House.
PAXTON ACCESS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 30 -
26
Cash generated from/(absorbed by) operations
2023
2022
£
£
Profit for the year after tax
4,252,858
1,035,141
Adjustments for:
Taxation charged/(credited)
68,000
(875,000)
Finance costs
546,048
39,481
(Gain)/loss on disposal of tangible fixed assets
(1,627)
158
Amortisation and impairment of intangible assets
90,841
117,704
Depreciation and impairment of tangible fixed assets
783,550
590,056
Foreign exchange losses/(gains) on cash equivalents
18,410
(18,773)
Increase in provisions
250,000
-
Movements in working capital:
Decrease/(increase) in stocks
2,346,501
(3,740,258)
Increase in debtors
(1,418,573)
(4,586,713)
(Decrease)/increase in creditors
(3,167,978)
1,718,864
Cash generated from/(absorbed by) operations
3,768,030
(5,719,340)
27
Analysis of changes in net debt
1 January 2023
Cash flows
New finance leases
Exchange rate movements
31 December 2023
£
£
£
£
£
Cash at bank and in hand
401,722
2,132,919
-
(18,410)
2,516,231
Bank overdrafts
(2,669,547)
2,669,547
-
-
(2,267,825)
4,802,466
-
(18,410)
2,516,231
Borrowings excluding overdrafts
-
(2,863,780)
-
-
(2,863,780)
Obligations under finance leases
(232,649)
704,087
(1,633,167)
-
(1,161,729)
(2,500,474)
2,642,773
(1,633,167)
(18,410)
(1,509,278)
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