The directors present the strategic report and financial statements for the year ended 31 October 2023.
Background
JPO Communications Ltd ('JPO') was formed in March 2014. In July 2014 JPO acquired 100% of the issued share capital of Geoff Neal Litho Ltd ('GNL') a litho printing and direct mail company. This is the only investment held by JPO and is the source of all JPO's income in the form of rent for the land and buildings occupied by GNL and dividends.
Review of subsidiary
The company's turnover fell by almost 10% from £11,979,754 in 2022 to £10,841,447 in 2023. Demand remains subdued due to ongoing adverse economic conditions. The net profit before tax was £15,703, down from £687,612 in 2022. The profit in 2022 included an exceptional book profit on the sale of a Heidelberg printing press. The gross profit margin improved to 31.1% from 28.2% in 2022. Cash balances dropped during the year from £767,590 to £427,234. The CBILS loan was repaid in the year.
The print industry is an extremely competitive and challenging environment with constant downward pressure on profit margins. The company continues to adapt as best it can to the current market demands and requirements. Customer demand remains weak due to ongoing economic uncertainty and various adverse economic conditions such as high interest rates and inflation. Despite the various challenges the company holds good financial reserves and retains a strong customer base. The director remains confident the market will improve. The business is well placed to respond to an uplift in customer demand.
The results for the period are considered satisfactory as is the financial position at the year end.
The directors assess the performance of the business using a variety of key performance indicators, including the measurement of turnover and profit and liquid funds.
The consolidated group accounts of JPO Communications Ltd for the year ending 31 October 2023 delivered the following for the year:
Profit after taxation £128,687 profit (2022: £700,230 profit).
At the year end date, the balance sheet net asset value was £3,819,678 (2022: £4,206,126).
In the financial statements of Geoff Neal Litho Ltd for the year ending 31 October 2023 the company delivered the following for the year:
Turnover £10,841,447 (2022: £11,979,754).
Gross profit % of 31.10% (2022: 28.27%).
Profit before taxation £15,703 (2022 : £687,612).
Cash balance of £427,234 (2022: £767,590) and bank loan finance of £nil (2022: £385,495).
The directors are fully aware of their social and corporate responsibilities, particularly with regard to environmental issues and are continually striving to reduce the carbon footprint of the business. The subsidiary company has been accredited with ISO 9001, ISO 14001 and ISO 27001 standards.
On behalf of the board
The directors present their annual report and financial statements for the year ended 31 October 2023.
The results for the year are set out on page 9.
Interim dividends of £515,135 (2022 - £337,710) were paid in aggregate by the parent company during the year as follows:
Ordinary 'A' £1 shares £423,575 (2022 - £246,150)
Ordinary 'B' £1 shares £91,560 (2022 - £91,560)
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
The group’s principal financial instruments include bank overdrafts and loans, the main purpose of which is to raise finance for the group’s operations. In addition, the group has various other financial assets and liabilities such as trade debtors and trade creditors arising directly from its operations.
The group manages its cash and borrowing requirements in order to maximise interest income and minimise interest expense, whilst ensuring the group has sufficient liquid resources to meet the operating needs of the business.
The group is exposed to fair value interest rate risk on its fixed rate borrowings and cash flow interest rate risk on floating rate deposits, bank overdrafts and loans.
The subsidiary company did not carry out any research and development work in the current year. In previous years the company undertook various projects aimed at improving and increasing automation of the print process and also to create and enhance print product design solutions.
There have not been any events since the year end of such significance that require reference to in this report.
The company shall continue to strive for greater productivity and efficiency while ensuring the business keeps up to date with all technological advances
The auditor, AEL Markhams Ltd, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.
We have audited the financial statements of JPO Communications Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 October 2023 which comprise the group profit and loss account, the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows, the company 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).
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the group and parent company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Material uncertainty relating to going concern
We draw attention to the going concern note in the Accounting Policies section of the financial statements, which outlines the directors' assessment of the situation and the steps the directors are taking to mitigate the risks. These conditions indicate that a material uncertainty exists that may cast doubt on the company's ability to continue as a 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. Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report. Our opinion is not modified in respect of this matter.
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:
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.
In the light of the knowledge and understanding of the group and the parent company and their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or
the parent company financial statements are not in agreement with the accounting records and returns; or
certain disclosures of directors' remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the parent company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the parent company or to cease operations, or have no realistic alternative but to do so.
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below:
We identified the following areas as those most likely to have a material impact on the financial statements: health and safety; employment law; environmental policies and compliance with the UK Companies Act 2006 and the Financial Reporting Standard FRS102.
Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations was as follows:
- Enquiry of management about any known or suspected instances of non-compliance with laws and regulations, accidents in the workplace and fraud;
- Questioning judgements and assumptions made by management in their significant accounting estimates, in particular depreciation calculations;
- Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations.
- Auditing the risk of management override of controls, including through testing journal entries and other adjustments for appropriateness, and evaluating the business rationale of significant transactions outside the normal course of business.
There are inherent limitations in the audit procedures described above. The more removed the laws and regulations are from the financial transactions, the less likely it is that we would become aware of non-compliance. Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at: http://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.
Use of our report
This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.
The profit and loss account has been prepared on the basis that all operations are continuing operations.
These financial statements have been prepared in accordance with the provisions relating to medium-sized groups.
As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £399,083 (2022 - £282,375 profit).
JPO Communications Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is 7 Pier Road, Feltham, Middlesex, United Kingdom, TW14 0TW.
The group consists of JPO Communications Limited and its only subsidiary, Geoff Neal Litho Ltd.
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, modified to include the revaluation of freehold properties and to include investment properties and certain financial instruments at fair value. The principal accounting policies adopted are set out below.
The consolidated group financial statements consist of the financial statements of the parent company JPO Communications Limited together with all entities controlled by the parent company (its subsidiaries) and the group’s share of its interests in joint ventures and associates.
All financial statements are made up to 31 October 2023. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.
All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.
These financial statements are prepared on the going concern basis. The directors have a reasonable expectation that the group will continue in operational existence for the foreseeable future. However, the directors are aware of certain material uncertainties which may cause doubt on the group's ability to continue as a going concern.
In May 2023, JPO re-financed the five year loan facility it had with Barclays Bank Plc, taking out a new 15 year loan with National Westminster Bank Plc. JPO is reliant on the rental and dividend income from its subsidiary company Geoff Neal Litho Ltd ('GNL') to meet its bank loan repayment commitments. The director of GNL has considered relevant information, including budgets and forecasts and the impact of subsequent events in making their assessment of going concern. Demand for print remains subdued due to various adverse economic conditions such as high inflation and high interest rates.
Although the forecasts take account of the matters above, the underlying trading assumptions used in forecasting are uncertain and could be subject to significant variation. The directors have therefore concluded that these circumstances give rise to a material uncertainty. However, based on their assessments and the current resources available, the directors continue to adopt the going concern basis in preparing the annual report and accounts of the Group.
Turnover represents amounts receivable for goods and services net of VAT and trade discounts.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer. This in effect is when the job has been completed and the goods have been dispatched and received by the customer. A sales invoice is raised and the revenue is recorded based on the contracted price at the time of the sale i.e. when the amount of revenue can be measured reliably and it is probable that the economic benefits associated with the transaction will flow to the entity.
Revenue from contracts for the provision of professional services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that it is probable will be recovered.
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.
Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available. In the parent company financial statements, investments in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.
A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
At each reporting period end date, the group 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.
The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.
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.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. 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.
The group has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the group's balance sheet when the group becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset and the net amounts presented in the financial statements when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
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.
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.
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the group 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.
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 group after deducting all of its 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 are derecognised when the group's contractual obligations expire or are discharged or cancelled.
Equity instruments issued by the group are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the group.
The tax expense represents the sum of the tax currently payable and deferred tax.
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset if, and only if, there is a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
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.
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
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 balance sheet 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 leased asset are consumed.
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.
In the application of the group’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The most material accounting estimate in the financial statements is depreciation. When assessing the depreciation method and rate to apply, the directors estimate the useful life and residual value of the assets. The outcome of historic disposals of similar assets is a key source of information when making assumptions and judgements.
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.
An analysis of the group's turnover is as follows:
The average monthly number of persons (including directors) employed by the group and company during the year was:
Their aggregate remuneration comprised:
The main rate of corporation tax increased from 19% to 25% on 1 April 2023.
The deferred tax provision is calculated using a 25% corporation tax rates (2022 : 25%).
The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:
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:
When JPO Communications Ltd acquired the shares in Geoff Neal Litho Ltd in 2014 for £1,644,180 the fair value of the assets was calculated as £3,204,639 thus creating negative goodwill of £1,560,459. The directors chose to write this back over a five year period. The amortisation completed in the year end 31 October 2018.
The carrying value of land and buildings comprises:
The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.
Land and buildings with a carrying value of £5,000,000 (2022 - £5,000,000) have legal charges registered on them in respect of the bank borrowings.
In May 2018 the company bought the land and buildings at 7 and 11 Pier Road from Geoff Neal Litho Ltd, the wholly owned subsidiary of JPO Communications Ltd for £2,600,000, split £1,750,000 and £850,000 respectively. The two properties were professionally valued in January 2022 for the purpose of sale at a combined value of £5,000,000. In order to attribute a value to each property an apportionment in the same ratio as 2018 has been applied to the long leasehold (7) and freehold (11) respectively.
In the financial statements of the Parent company the land and buildings are classified as Investment Properties but in the Consolidated financial statements of the Group they are classified as Tangible Fixed Assets as the buildings are occupied by the subsidiary company Geoff Neal Litho Ltd.
No depreciation is charged on the long leasehold building (7 Pier Road) or the freehold (Unit H, 11 Pier Road) on the grounds that the depreciation charge would be immaterial.
In the financial statements of the Parent company the land and buildings assets are classified as Investment properties but in the Consolidated financial statements of the Group they are classified as Tangible Fixed Assets as the buildings are occupied by the subsidiary company Geoff Neal Litho Ltd.
The carrying value of land and buildings comprises:
Details of the company's subsidiaries at 31 October 2023 are as follows:
Finance leases and hire purchase contracts are secured on the specific assets financed. Included in other creditors above is £36,698 in respect of a finance arrangement for various items of Kodak and Nela equipment relating to the subsidiary company. The liability is secured on the assets concerned.
Finance leases and hire purchase contracts are secured on the specific assets financed. Included in other creditors above is £nil (2022: £18,261) in respect of a finance arrangement for various items of Kodak and Nela equipment. The liability is secured on the assets concerned.
The long-term loans in the parent company are secured by fixed charges over unit G, 7 Pier Road and Unit H, 11 Pier Road and a debenture over the assets of the subsidiary company. The CBILS long term loan in the subsidiary company was repaid during the year.
At the Balance Sheet date JPO Communications Ltd had two long term bank loans with NatWest Bank plc. The details are as follows:
Current
Loan balance Repayment date Interest rate Repayments
£ 992,782 2038 (15 year loan) 2.18% above Base Rate Monthly
£ 178,239 2038 (15 year loan) 3.10% above Base Rate Monthly
The loan facility from Barclays Bank was repaid in May 2023.
Finance lease payments represent rentals payable by the company for certain items of plant and machinery or other fixed assets. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. At the balance sheet date the subsidiary company had two agreements in place. The average length of the agreements being 4.5 years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.
The following are the major deferred tax liabilities and assets recognised by the group and company, and movements thereon:
The deferred tax liability set out above is expected to reverse by £65,140 in the next financial year and relates to accelerated capital allowances that are expected to mature within the same period.
In the financial statements of the Parent company the land and buildings assets are classified as Investment properties but in the Consolidated financial statements of the Group they are classified as Tangible Fixed Assets as the buildings are occupied by the subsidiary company Geoff Neal Litho Ltd. In the Parent company financial statements the fair value gain on the revaluation of the properties and the associated deferred tax is recognised in the Profit & Loss account. In the Group accounts the revaluation forms a revaluation reserve in the Balance Sheet which is then reduced by the associated deferred tax provision.
A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.
Non-Distributable reserves
The revaluation reserve of £1,800,000 is made up of the revaluation of £2,400,000 less the associated deferred tax provision of £600,000 specifically relating to the revalued amount. The revaluation reserve is a non-distributable reserve in the Group financial statements.
In the financial statements of the Parent company the revalued element of the Investment Property, net of the related deferred tax, is included in total Profit & Loss reserves on the Balance Sheet and the non-distributable amount of £1,800,000 disclosed in the supporting notes.
At the reporting end date the group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
The remuneration of key management personnel is as follows.
The directors of both JPO Communications Ltd and Geoff Neal Litho Ltd are regarded as the key management personnel.
The balances and trading transactions outlined below are all with the subsidiary company and are therefore part of the group. During the year the group entered into the following transactions with related parties:
The amounts shown above are inclusive of VAT where applicable.
The following amounts were outstanding at the reporting end date:
Standard trading terms and conditions apply to the above transactions and there is no security attaching to the outstanding balances.
The following amounts were outstanding at the reporting end date:
Standard trading terms and conditions apply to the above transactions and there is no security attaching to the outstanding balances.
Dividends totalling £515,135 (2022 - £337,710) were paid in the year in respect of shares held by the company's directors.
Loans to/from directors
At the beginning of the year the director Mr. S. Neal owed £100 to JPO Communications Ltd. There were no transactions during the year, leaving a balance of £100 owing at the balance sheet date. This is an interest free loan repayable on demand.