Company registration number 11178390 (England and Wales)
ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2023
ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
COMPANY INFORMATION
Directors
Mr J P Ellis
Mr S Ellis
Company number
11178390
Registered office
Wessex House
Teign Road
Newton Abbot
Devon
TQ12 4AA
Auditor
Darnells Audit Limited
Quay House
Quay Road
Newton Abbot
Devon
TQ12 2BU
Business address
Riviera House
Nicholson Road
Torquay
Devon
TQ2 7TD
ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3 - 4
Independent auditor's report
5 - 7
Group statement of comprehensive income
8
Group balance sheet
9 - 10
Company balance sheet
11
Group statement of changes in equity
12
Company statement of changes in equity
13
Group statement of cash flows
14
Company statement of cash flows
15
Notes to the financial statements
16 - 35
ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
STRATEGIC REPORT
FOR THE YEAR ENDED 31 OCTOBER 2023
- 1 -

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

Business Review
The directors consider that the key financial performance indicators are Turnover, Gross margin, Earnings before Interest, Tax, Depreciation and Amortisation (EBITDA) and Net Assets. Together these demonstrate the financial performance and strength of the company. An overview of these indicators for both the current period and the prior year is given below:
2023
2022
£
£
Turnover
16,963,994
14,649,526
Gross profit
4,471,238
3,651,123
Gross margin
26.36%
24.92%
EBITDA
1,996,231
1,607,584
Net assets
4,725,822
3,544,744

The group's turnover is up by £2.31 million on the sales achieved for 2022, reflecting strong growth in sales to wholesalers by Elite Optical Distribution Limited, despite this period of higher-than-normal interest rates.

 

The group's Gross profit margin has risen by 1.5% to 26.4% (24.9% in 2022), resulting in an increase in Gross profit of £0.82 million.

 

The group's share of the retained profit for the year was £1.07 million (2022: £0.79 million) after voting dividends of £51.4k (2022: £53.2k).

 

The group has maintained a strong Balance Sheet position, with Net current assets of £3.11 million compared with £2.88 million at 31 October 2022. The overall increase has arisen from a concerted effort to improve all lines on the balance sheet.

 

The directors are more than satisfied with the group's results for the year and the continued strength of its balance sheet.

Principal Risks and Uncertainties

The group's principal commercial risks include the uncertain economic environment, which is affecting suppliers and customers alike. The directors monitor and manage those risks by reviewing the performance of each company in the group on a regular basis. The directors also maintain close working relationships with the group's suppliers to ensure distribution remains as smooth as possible given the current economic headwinds and global supply chain disruptions.

 

The impact of the war in Ukraine and rising inflation levels for the UK, and their effects at the date of these financial statements are still uncertain, with the full range of possible effects unknown. To date the group has been able to manage its pricing in line with increasing costs, but the full impact of these economic events upon the group's long-term operations is uncertain, and may take many months to become known.

 

The directors believe that the exposure of the group to price risk, credit risk, liquidity risk and cash flow risk is well monitored and maintained at a satisfactory level given the nature and scale of operations.

ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
- 2 -
Financial Instruments

The group's principal financial instruments comprise trade debtors and creditors, loans from directors, together with bank and other loans.

 

Due to the nature of the financial instruments used by the group, there is no exposure to price risk. The group's approach to managing other risks applicable to the financial instruments concerned is shown below.

 

Liquidity risk is managed by the directors' monitoring of rolling forecasts, maintaining a balance between available cash reserves and its underdrawn bank loan facility at a floating rate of interest.

 

In respect of loans, these comprise loans from financial institutions. The interest rate on bank loans is variable, and they are repaid by fixed monthly repayments over the life of the loan. The group manages the liquidity risk by ensuring there are sufficient funds to meet the payments. Loans from Directors are unsecured and interest free.

 

Trade debtors are managed in respect of credit and cash flow risk by the implementation of policies that require appropriate checks on potential customers before any sales are made. The company has no significant concentration of credit risk due to the nature of the business.

 

Trade creditors risk is managed by ensuring that there are sufficient funds available to meet amounts as they fall due.

On behalf of the board

Mr S Ellis
Director
29 July 2024
ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 OCTOBER 2023
- 3 -

The directors present their annual report and consolidated financial statements for the year ended 31 October 2023. Information required to be disclosed under Schedule 7 of the Companies Act 2006 is set out in the Strategic Report on pages 1 - 2.

Principal activities

The principal activity of the company during the year continued to be that of a holding company.

 

The principal activity of the group during the year continued to be that of the sale of optical equipment to both wholesale and retail customers.

 

Results and dividends

The results for the year are set out on page 8.

Ordinary dividends were paid amounting to £51,471. The directors do not recommend payment of a further dividend.

Directors

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

Mr J P Ellis
Mr S Ellis
Future developments

The directors remain very optimistic and upbeat as they continue to focus on reducing costs, whilst striving to expand the group's operations and maintain turnover in the current financial year.

 

The directors are also looking to expand market share by acquiring new businesses when the opportunity arises.

Statement of directors' responsibilities

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

 

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

 

 

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

ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
- 4 -
Statement of disclosure to auditor

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

Medium-sized companies exemption

This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.

On behalf of the board
Mr S Ellis
Director
29 July 2024
2024-07-29
ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
- 5 -
Opinion

We have audited the financial statements of Ellis Holdings Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 October 2023 which comprise the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows, 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).

In our opinion the financial statements:

Basis for opinion

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

Conclusions relating to going concern

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

 

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

 

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

Other information

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

 

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

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

ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
- 6 -
Matters on which we are required to report by exception

In the light of the knowledge and understanding of the group and the parent company and their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.

 

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

Responsibilities of directors

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

Auditor's responsibilities for the audit of the financial statements

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

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 risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery, misrepresentation or through collusion. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

 

However, the primary responsibility for the prevention and detection of fraud rests with those charged with governance of the company and management.

 

We obtained an understanding of the legal and regulatory frameworks that are applicable to the company, and determined the most significant are the Health & Safety at Work Act 1974, and the Health & Safety Regulations 1992 & 1999 (as well as FRS102, the Companies Act 2006 and relevant tax compliance regulations in the UK).

We assessed the susceptibility of the company's financial statements to material misstatement, including how fraud might occur, by considering the controls that the company has established to both address risks identified by management and to prevent, deter and detect fraud in the areas of:

 

 

We evaluated the conditions in the context of incentives and/or pressure to commit fraud, considering the opportunity to commit fraud and the potential rationalisation of the fraudulent act.

ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
- 7 -

Based on this understanding, we designed our audit procedures to detect material misstatements in respect of irregularities, including fraud, and to identify non-compliance with the laws and regulations above, as follows:

 

 

We corroborated our enquiries through inspection of supporting documentation and records, as well as reviewing correspondence with regulatory bodies where available.

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

Use of our report

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

Sean Murphy (Senior Statutory Auditor)
For and on behalf of Darnells Audit Limited
29 July 2024
Statutory Auditor
Quay House
Quay Road
Newton Abbot
Devon
TQ12 2BU
ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 OCTOBER 2023
- 8 -
2023
2022
Notes
£
£
Turnover
2
16,963,994
14,649,526
Cost of sales
(12,492,756)
(10,998,403)
Gross profit
4,471,238
3,651,123
Distribution costs
(614,685)
(614,475)
Administrative expenses
(2,074,332)
(1,787,287)
Other operating income
35,500
-
Operating profit
3
1,817,721
1,249,361
Interest receivable and similar income
1,336
-
0
Interest payable and similar expenses
7
(11,820)
(16,940)
Profit before taxation
1,807,237
1,232,421
Tax on profit
8
(469,693)
(275,396)
Profit for the financial year
1,337,544
957,025
Profit for the financial year is attributable to:
- Owners of the parent company
1,123,692
839,833
- Non-controlling interests
213,852
117,192
1,337,544
957,025
Total comprehensive income for the year is attributable to:
- Owners of the parent company
1,123,692
839,833
- Non-controlling interests
213,852
117,192
1,337,544
957,025
ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
GROUP BALANCE SHEET
AS AT 31 OCTOBER 2023
31 October 2023
- 9 -
2023
2022
Notes
£
£
£
£
Fixed assets
Goodwill
10
151,506
94,410
Other intangible assets
10
17,330
-
0
Total intangible assets
168,836
94,410
Tangible assets
11
2,982,019
1,355,677
3,150,855
1,450,087
Current assets
Stocks
15
3,038,617
3,081,081
Debtors
16
1,638,058
992,986
Cash at bank and in hand
1,827,610
1,309,694
6,504,285
5,383,761
Creditors: amounts falling due within one year
17
(3,388,713)
(2,504,587)
Net current assets
3,115,572
2,879,174
Total assets less current liabilities
6,266,427
4,329,261
Creditors: amounts falling due after more than one year
18
(1,420,864)
(756,371)
Provisions for liabilities
Deferred tax liability
21
119,741
28,146
(119,741)
(28,146)
Net assets
4,725,822
3,544,744
Capital and reserves
Called up share capital
23
200
200
Share premium account
39,980
39,980
Other reserves
2,099,900
2,099,900
Profit and loss reserves
2,302,752
1,230,531
Equity attributable to owners of the parent company
4,442,832
3,370,611
Non-controlling interests
282,990
174,133
4,725,822
3,544,744

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

ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
GROUP BALANCE SHEET (CONTINUED)
AS AT 31 OCTOBER 2023
31 October 2023
- 10 -
The financial statements were approved by the board of directors and authorised for issue on 29 July 2024 and are signed on its behalf by:
29 July 2024
Mr S Ellis
Director
Company registration number 11178390 (England and Wales)
ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
COMPANY BALANCE SHEET
AS AT 31 OCTOBER 2023
31 October 2023
- 11 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
11
1,523,436
385,756
Investments
12
555
380
1,523,991
386,136
Current assets
Debtors
16
420,381
114,775
Cash at bank and in hand
404,552
522,409
824,933
637,184
Creditors: amounts falling due within one year
17
(69,656)
(180)
Net current assets
755,277
637,004
Total assets less current liabilities
2,279,268
1,023,140
Creditors: amounts falling due after more than one year
18
(1,389,838)
(534,792)
Net assets
889,430
488,348
Capital and reserves
Called up share capital
23
200
200
Profit and loss reserves
889,230
488,148
Total equity
889,430
488,348

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 £452,553 (2022 - £53,156 profit).

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

The financial statements were approved by the board of directors and authorised for issue on 29 July 2024 and are signed on its behalf by:
29 July 2024
Mr S Ellis
Director
Company registration number 11178390 (England and Wales)
ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 OCTOBER 2023
- 12 -
Share capital
Share premium account

"Merger" reserve

Profit and loss reserves
Total controlling interest
Non-controlling interest
Total
Notes
£
£
£
£
£
£
£
Balance at 1 November 2021
200
39,980
2,099,900
443,854
2,583,934
66,941
2,650,875
Year ended 31 October 2022:
Profit and total comprehensive income
-
-
-
839,833
839,833
117,192
957,025
Dividends
9
-
-
-
(53,156)
(53,156)
(10,000)
(63,156)
Balance at 31 October 2022
200
39,980
2,099,900
1,230,531
3,370,611
174,133
3,544,744
Year ended 31 October 2023:
Profit and total comprehensive income
-
-
-
1,123,692
1,123,692
213,852
1,337,544
Dividends
9
-
-
-
(51,471)
(51,471)
(105,000)
(156,471)
Acquisition of subsidiary
-
-
-
-
-
5
5
Balance at 31 October 2023
200
39,980
2,099,900
2,302,752
4,442,832
282,990
4,725,822
ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 OCTOBER 2023
- 13 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 November 2021
200
488,148
488,348
Year ended 31 October 2022:
Profit and total comprehensive income for the year
-
53,156
53,156
Dividends
9
-
(53,156)
(53,156)
Balance at 31 October 2022
200
488,148
488,348
Year ended 31 October 2023:
Profit and total comprehensive income
-
452,553
452,553
Dividends
9
-
(51,471)
(51,471)
Balance at 31 October 2023
200
889,230
889,430
ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 OCTOBER 2023
- 14 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
27
2,261,184
531,804
Interest paid
(11,820)
(16,940)
Income taxes paid
(355,954)
(169,072)
Net cash inflow from operating activities
1,893,410
345,792
Investing activities
Purchase of intangible assets
(182,840)
-
Purchase of tangible fixed assets
(1,658,013)
(456,505)
Proceeds from disposal of tangible fixed assets
13,980
34,167
Purchase of subsidiaries, net of cash acquired
(15)
-
Proceeds from disposal of subsidiaries, net of cash disposed
20
-
Interest received
1,336
-
0
Net cash used in investing activities
(1,825,532)
(422,338)
Financing activities
Proceeds from new bank loans
825,000
363,544
Repayment of bank loans
(220,353)
(17,769)
Payment of finance leases obligations
(1,676)
(5,024)
Dividends paid to equity shareholders
(51,471)
(53,156)
Dividends paid to non-controlling interests
(105,000)
(10,000)
Net cash generated from financing activities
446,500
277,595
Net increase in cash and cash equivalents
514,378
201,049
Cash and cash equivalents at beginning of year
1,303,404
1,102,355
Cash and cash equivalents at end of year
1,817,782
1,303,404
Relating to:
Cash at bank and in hand
1,827,610
1,309,694
Bank overdrafts included in creditors payable within one year
(9,828)
(6,290)
ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
COMPANY STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 OCTOBER 2023
- 15 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash absorbed by operations
28
(177,840)
(37,984)
Investing activities
Purchase of tangible fixed assets
(1,137,680)
-
0
Purchase of subsidiaries
(195)
(180)
Proceeds from disposal of subsidiaries
20
-
Interest received
1,336
-
0
Dividends received
451,471
53,156
Net cash (used in)/generated from investing activities
(685,048)
52,976
Financing activities
Proceeds from new bank loans
825,000
-
Repayment of bank loans
(28,498)
(4,970)
Dividends paid to equity shareholders
(51,471)
(53,156)
Net cash generated from/(used in) financing activities
745,031
(58,126)
Net decrease in cash and cash equivalents
(117,857)
(43,134)
Cash and cash equivalents at beginning of year
522,409
565,543
Cash and cash equivalents at end of year
404,552
522,409
ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2023
- 16 -
1
Accounting policies
Company information

Ellis Holdings Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is Wessex House, Teign Road, Newton Abbot, Devon TQ12 4AA.

 

The group consists of Ellis Holdings Limited and all of its subsidiaries.

1.1
Accounting convention

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

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

The financial statements have been prepared under the historical cost convention, [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.

1.2
Business combinations

In the parent company financial statements, the cost of a business combination is the fair value at the acquisition date of the assets given, equity instruments issued and liabilities incurred or assumed, plus costs directly attributable to the business combination. The excess of the cost of a business combination over the fair value of the identifiable assets, liabilities and contingent liabilities acquired is recognised as goodwill. The cost of the combination includes the estimated amount of contingent consideration that is probable and can be measured reliably, and is adjusted for changes in contingent consideration after the acquisition date. Provisional fair values recognised for business combinations in previous periods are adjusted retrospectively for final fair values determined in the 12 months following the acquisition date. Investments in subsidiaries, joint ventures and associates are accounted for at cost less impairment.

 

Deferred tax is recognised on differences between the value of assets (other than goodwill) and liabilities recognised in a business combination accounted for using the purchase method and the amounts that can be deducted or assessed for tax, considering the manner in which the carrying amount of the asset or liability is expected to be recovered or settled. The deferred tax recognised is adjusted against goodwill or negative goodwill.

1.3
Basis of consolidation

The consolidated group financial statements consist of the financial statements of the parent company Ellis Holdings 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.

Subsidiaries are consolidated in the group’s financial statements from the date that control commences until the date that control ceases.

ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
1
Accounting policies
(Continued)
- 17 -
1.4
Going concern

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

1.5
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.

1.6
Intangible fixed assets - goodwill

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

 

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

1.7
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 acquired on business combinations are recognised separately from goodwill at the acquisition date where it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the fair value of the asset can be measured reliably; the intangible asset arises from contractual or other legal rights; and the intangible asset is separable from the entity.

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:

Software
25% per annum on a straight-line basis
1.8
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.

ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
1
Accounting policies
(Continued)
- 18 -

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 land and buildings
No depreciation charged
Leasehold improvements
No depreciation charged
Plant and machinery
15% per annum on a reducing balance basis
Fixtures and fittings
15% per annum on a reducing balance basis
Computers
20% per annum on a straight-line basis
Motor vehicles
25% per annum on a reducing balance basis
Other assets
10% per annum on a reducing balance basis

No depreciation is charged on freehold and leasehold property as, in the opinion of the directors, the useful economic lives and residual values are such that any depreciation charge would be immaterial.

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

1.9
Fixed asset investments

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.

An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The group considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.

 

Investments in associates are initially recognised at the transaction price (including transaction costs) and are subsequently adjusted to reflect the group’s share of the profit or loss, other comprehensive income and equity of the associate using the equity method. Any difference between the cost of acquisition and the share of the fair value of the net identifiable assets of the associate on acquisition is recognised as goodwill. Any unamortised balance of goodwill is included in the carrying value of the investment in associates.

 

Losses in excess of the carrying amount of an investment in an associate are recorded as a provision only when the company has incurred legal or constructive obligations or has made payments on behalf of the associate.

 

In the parent company financial statements, investments in associates are accounted for at cost less impairment.

Entities in which the group has a long-term interest and shares control under a contractual arrangement are classified as jointly controlled entities.

ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
1
Accounting policies
(Continued)
- 19 -
1.10
Impairment of fixed assets

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.

1.11
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.

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.

1.12
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.

ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
1
Accounting policies
(Continued)
- 20 -
1.13
Financial instruments

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

 

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

 

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

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.

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 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.

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 group after deducting all of its liabilities.

ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
1
Accounting policies
(Continued)
- 21 -
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.

Other financial liabilities

Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.

 

Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

Derecognition of financial liabilities

Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.

1.14
Equity instruments

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

1.15
Taxation

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

Current tax

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

ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
1
Accounting policies
(Continued)
- 22 -
Deferred tax

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

 

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

1.16
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.

1.17
Retirement benefits

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

1.18
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 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.

2
Turnover and other revenue
2023
2022
£
£
Turnover analysed by class of business
Sale of goods
16,963,994
14,649,526
ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
2
Turnover and other revenue
(Continued)
- 23 -
2023
2022
£
£
Other revenue
Interest income
1,336
-

All of the group's turnover derives from its principal activity in the UK.

3
Operating profit
2023
2022
£
£
Operating profit for the year is stated after charging/(crediting):
Exchange losses
548
34,381
Depreciation of owned tangible fixed assets
70,096
52,029
(Profit)/loss on disposal of tangible fixed assets
(4,095)
1,036
Amortisation of intangible assets
108,414
306,194
Operating lease charges
31,044
17,091
4
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the group and company
1,000
-
Audit of the financial statements of the company's subsidiaries
10,000
-
11,000
-

2023 is the first year that consolidated financial statements have been prepared and audited for the group.

5
Employees

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

Group
Company
2023
2022
2023
2022
Number
Number
Number
Number
Directors
2
2
2
2
Sales
21
20
-
-
Stores
8
7
-
-
Office & administration
5
4
-
-
Total
36
33
2
2
ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
5
Employees
(Continued)
- 24 -

Their aggregate remuneration comprised:

Group
Company
2023
2022
2023
2022
£
£
£
£
Wages and salaries
1,066,080
886,129
-
0
-
0
Social security costs
5,880
-
-
-
Pension costs
16,332
14,195
-
0
-
0
1,088,292
900,324
-
0
-
0
6
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
23,904
34,194
7
Interest payable and similar expenses
2023
2022
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
9,923
13,135
Other finance costs:
Interest on finance leases and hire purchase contracts
1,897
3,805
Total finance costs
11,820
16,940
8
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
378,098
275,396
Deferred tax
Origination and reversal of timing differences
91,595
-
0
Total tax charge
469,693
275,396
ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
8
Taxation
(Continued)
- 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:

2023
2022
£
£
Profit before taxation
1,807,237
1,232,421
Expected tax charge based on the standard rate of corporation tax in the UK of 22.50% (2022: 19.00%)
406,628
234,160
Tax effect of expenses that are not deductible in determining taxable profit
1,158
666
Unutilised tax losses carried forward
1,365
-
0
Effect of change in corporation tax rate
1,164
-
Permanent capital allowances in excess of depreciation
37,846
(17,049)
Depreciation on assets not qualifying for tax allowances
21,243
58,177
Other permanent differences
289
(558)
Taxation charge
469,693
275,396
9
Dividends
2023
2022
Recognised as distributions to equity holders:
£
£
Final paid
51,471
53,156
10
Intangible fixed assets
Group
Goodwill
Software
Total
£
£
£
Cost
At 1 November 2022
1,590,972
-
0
1,590,972
Additions
164,757
18,083
182,840
At 31 October 2023
1,755,729
18,083
1,773,812
Amortisation and impairment
At 1 November 2022
1,496,562
-
0
1,496,562
Amortisation charged for the year
107,661
753
108,414
At 31 October 2023
1,604,223
753
1,604,976
Carrying amount
At 31 October 2023
151,506
17,330
168,836
At 31 October 2022
94,410
-
0
94,410
Company
ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
10
Intangible fixed assets
(Continued)
- 26 -
The company had no intangible fixed assets at 31 October 2023 or 31 October 2022.
ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
- 27 -
11
Tangible fixed assets
Group
Freehold land and buildings
Leasehold improvements
Plant and machinery
Fixtures and fittings
Computers
Motor vehicles
Other assets
Total
£
£
£
£
£
£
£
£
Cost
At 1 November 2022
997,221
107,367
154,692
73,704
86,147
93,361
3,667
1,516,159
Additions
1,437,295
-
0
18,219
66,488
76,766
104,305
3,250
1,706,323
Disposals
-
0
-
0
-
0
-
0
-
0
(32,600)
-
0
(32,600)
At 31 October 2023
2,434,516
107,367
172,911
140,192
162,913
165,066
6,917
3,189,882
Depreciation and impairment
At 1 November 2022
4,396
-
0
40,207
25,475
60,981
28,995
428
160,482
Depreciation charged in the year
633
-
0
18,896
11,899
19,775
18,460
433
70,096
Eliminated in respect of disposals
-
0
-
0
-
0
-
0
-
0
(22,715)
-
0
(22,715)
At 31 October 2023
5,029
-
0
59,103
37,374
80,756
24,740
861
207,863
Carrying amount
At 31 October 2023
2,429,487
107,367
113,808
102,818
82,157
140,326
6,056
2,982,019
At 31 October 2022
992,825
107,367
114,485
48,229
25,166
64,366
3,239
1,355,677
ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
- 28 -
Company
Freehold land and buildings
Leasehold improvements
Total
£
£
£
Cost
At 1 November 2022
278,389
107,367
385,756
Additions
1,137,680
-
0
1,137,680
At 31 October 2023
1,416,069
107,367
1,523,436
Depreciation and impairment
At 1 November 2022 and 31 October 2023
-
0
-
0
-
0
Carrying amount
At 31 October 2023
1,416,069
107,367
1,523,436
At 31 October 2022
278,389
107,367
385,756
12
Fixed asset investments
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Investments in subsidiaries
13
-
0
-
0
555
380
Movements in fixed asset investments
Company
Shares in subsidiaries
£
Cost or valuation
At 1 November 2022
380
Additions
195
Disposals
(20)
At 31 October 2023
555
Carrying amount
At 31 October 2023
555
At 31 October 2022
380
13
Subsidiaries

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

ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
13
Subsidiaries
(Continued)
- 29 -
Name of undertaking
Registered office
Nature of business
Class of
% Held
shares held
Direct
Optics Warehouse Limited
Wessex House, Teign Road, Newton Abbot, Devon TQ12 4AA
Internet retailing of optical equipment
Ordinary
100.00
Elite Optical Distribution Limited
Wessex House, Teign Road, Newton Abbot, Devon TQ12 4AA
Sale of optical equipment to wholesalers
Ordinary
80.00
NICKWAKE Limited
Wessex House, Teign Road, Newton Abbot, Devon TQ12 4AA
Internet retailing of optical equipment
Ordinary
95.00
4Wildlife Limited
Wessex House, Teign Road, Newton Abbot, Devon TQ12 4AA
Retailing of optical equipment for watching wildlife
Ordinary
100.00
The aggregate capital and reserves and the result for the year of the subsidiaries noted above was as follows:
Name of undertaking
Capital and Reserves
Profit/(Loss)
£
£
Optics Warehouse Limited
2,153,557
336,878
Elite Optical Distribution Limited
1,647,988
1,058,992
NICKWAKE Limited
41,170
41,070
4Wildlife Limited
(5,968)
(6,068)
14
Financial instruments
Group
Company
2023
2022
2023
2022
£
£
£
£
Carrying amount of financial assets
Debt instruments measured at undiscounted amount receivable:
Trade and other debtors
1,573,861
989,858
394,500
114,775
Carrying amount of financial liabilities
Bank loans and obligations under finance leases
3,995,406
2,544,382
1,457,765
64,992
Debt instruments measured at undiscounted amount payable:
Trade and other creditors
2,800,768
2,004,563
596,271
470,160
15
Stocks
Group
Company
2023
2022
2023
2022
£
£
£
£
Finished goods and goods for resale
3,038,617
3,081,081
-
0
-
0
ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
- 30 -
16
Debtors
Group
Company
2023
2022
2023
2022
Amounts falling due within one year:
£
£
£
£
Trade debtors
876,678
943,283
1
1
Amounts owed by group undertakings
-
-
391,302
114,774
Other debtors
719,456
46,575
3,905
-
0
Prepayments and accrued income
41,924
3,128
25,173
-
0
1,638,058
992,986
420,381
114,775

Group

Included in Other debtors is an amount of £628,046 (2022: £Nil) representing the value of goods in transit at the year end.

 

Company

Amounts owed by group undertakings are unsecured, interest free and repayable on demand.

 

17
Creditors: amounts falling due within one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Bank loans and overdrafts
19
74,008
23,550
43,180
-
0
Obligations under finance leases
20
11,801
693
-
0
-
0
Trade creditors
1,686,861
1,719,706
24,372
-
0
Amounts owed to group undertakings
-
0
-
0
375
180
Corporation tax payable
298,098
275,954
254
-
0
Other taxation and social security
463,349
433,330
-
-
Other creditors
801,872
44,062
-
0
-
0
Accruals and deferred income
52,724
7,292
1,475
-
0
3,388,713
2,504,587
69,656
180

Group

Bank loans and overdrafts are secured by a fixed and floating charge over all the assets of the group.

 

Obligations under finance leases and hire purchase contracts are secured upon the assets acquired.

 

Included in Other creditors is an amount payable of £628,046 (2022: £Nil) for goods in transit at the year end.

 

Company

Bank loans and overdrafts are secured by a fixed and floating charge over all the assets of the company.

ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
- 31 -
18
Creditors: amounts falling due after more than one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Bank loans and overdrafts
19
1,073,303
515,576
818,314
64,992
Obligations under finance leases
20
35,526
-
0
-
0
-
0
Other borrowings
19
312,035
240,795
-
0
-
0
Amounts owed to group undertakings
-
0
-
0
571,524
469,800
1,420,864
756,371
1,389,838
534,792

Group

Bank loans and overdrafts are secured by a fixed and floating charge over all the assets of the group.

 

Obligations under finance leases and hire purchase contracts are secured upon the assets acquired.

 

Company

Bank loans and overdrafts are secured by a fixed and floating charge over all the assets of the company.

 

Amounts owed to group undertakings are unsecured, interest free and repayable within 1-5 years.

 

 

Amounts included above which fall due after five years are as follows:
Payable by instalments
808,303
185,800
638,314
-
19
Loans and overdrafts
Group
Company
2023
2022
2023
2022
£
£
£
£
Bank loans
1,137,483
532,836
861,494
64,992
Bank overdrafts
9,828
6,290
-
0
-
0
Other loans
312,035
240,795
-
0
-
0
1,459,346
779,921
861,494
64,992
Payable within one year
74,008
23,550
43,180
-
0
Payable after one year
1,385,338
756,371
818,314
64,992

Group

The long-term bank loans are repayable by monthly instalments totalling £10,141. Interest is charged at rates of between 3% and 9.5%. The maturity dates of the loans range from 2034 to 2043.

 

Company

The long-term bank loans are repayable by monthly instalments totalling £7,265. Interest is charged at rates of between 4% and 7%. The maturity dates of the loans range from 2034 to 2043.

ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
- 32 -
20
Finance lease obligations
Group
Company
2023
2022
2023
2022
£
£
£
£
Future minimum lease payments due under finance leases:
Within one year
11,801
693
-
0
-
0
In two to five years
44,670
-
0
-
0
-
0
56,471
693
-
-
Less: future finance charges
(9,144)
-
0
-
0
-
0
47,327
693
-
0
-
0

Finance lease payments represent rentals payable by the company or group for certain items of plant and machinery. 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 3 years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.

21
Deferred taxation

The following are the major deferred tax liabilities and assets recognised by the group and company, and movements thereon:

Liabilities
Liabilities
2023
2022
Group
£
£
Accelerated capital allowances
119,741
28,146
The company has no deferred tax assets or liabilities.
Group
Company
2023
2023
Movements in the year:
£
£
Liability at 1 November 2022
28,146
-
Charge to profit or loss
91,595
-
Liability at 31 October 2023
119,741
-

The deferred tax liability] set out above is expected to reverse within the foreseeable future, and relates to accelerated capital allowances that are expected to mature within the same period.

22
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
16,332
14,195
ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
22
Retirement benefit schemes
(Continued)
- 33 -

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.

23
Share capital
Group and company
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
A Ordinary shares of £1 each
150
150
150
150
B Ordinary shares of £1 each
50
50
50
50
200
200
200
200
24

"Merger" reserve

2023
2022
Group
£
£
At the beginning and end of the year
2,099,900
2,099,900
2023
2022
Company
£
£
At the beginning and end of the year
-
-

Group

 

The "Merger" reserve above arose following the group reconstruction in 2018, when Ellis Holdings Limited acquired the entire issued share capital of Optics Warehouse Limited in a share for share exchange. The "Merger" reserve represents the difference between the nominal value of the shares issued and the fair value of the net assets acquired.

 

Company

 

Ellis Holdings Limited has taken advantage of the merger relief provisions under section 615 of the Companies Acy 2006 from creating a "Merger" reserve in its own financial statements.

25
Directors' transactions

Dividends totalling £51,471 (2022: £53,156) were paid in the year in respect of shares held by the company's directors.

26
Controlling party

The company's ultimate and immediate parent company is Ellis Holdings Limited, a company registered in England & Wales which heads the group to consolidate these financial statements. Copies of the consolidated group accounts can be obtained from its registered office at Wessex House, Teign Road, Newton Abbot, Devon TQ12 4AA.

 

The ultimate controlling party is Mr J P Ellis, the majority shareholder.

ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
- 34 -
27
Cash generated from group operations
2023
2022
£
£
Profit for the year after tax
1,337,544
957,025
Adjustments for:
Taxation charged
469,693
275,396
Finance costs
11,820
16,940
Investment income
(1,336)
-
0
(Gain)/loss on disposal of tangible fixed assets
(4,095)
1,036
Amortisation and impairment of intangible assets
108,414
306,194
Depreciation and impairment of tangible fixed assets
70,096
52,029
Movements in working capital:
Decrease/(increase) in stocks
42,464
(1,026,674)
Increase in debtors
(645,072)
(594,247)
Increase in creditors
871,656
544,105
Cash generated from operations
2,261,184
531,804

Non-cash items in Investing activities

Motor vehicle additions of £48,310 in the year under a hire purchase contract (2022: £Nil) have been excluded from the Statement of Cash Flows.

28
Cash absorbed by operations - company
2023
2022
£
£
Profit for the year after tax
452,553
53,156
Adjustments for:
Taxation charged
254
-
0
Investment income
(452,807)
(53,156)
Movements in working capital:
Increase in debtors
(305,606)
(7,964)
Increase/(decrease) in creditors
127,766
(30,020)
Cash absorbed by operations
(177,840)
(37,984)
ELLIS HOLDINGS LIMITED GROUP - CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
- 35 -
29
Analysis of changes in net funds - group
1 November 2022
Cash flows
31 October 2023
£
£
£
Cash at bank and in hand
1,309,694
517,916
1,827,610
Bank overdrafts
(6,290)
(3,538)
(9,828)
1,303,404
514,378
1,817,782
Borrowings excluding overdrafts
(773,631)
(675,887)
(1,449,518)
Obligations under finance leases
(693)
(46,634)
(47,327)
529,080
(208,143)
320,937
30
Analysis of changes in net funds/(debt) - company
1 November 2022
Cash flows
31 October 2023
£
£
£
Cash at bank and in hand
522,409
(117,857)
404,552
Borrowings excluding overdrafts
(64,992)
(796,502)
(861,494)
457,417
(914,359)
(456,942)
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