Company registration number 01274236 (England and Wales)
GEOFF NEAL LITHO LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2023
GEOFF NEAL LITHO LIMITED
COMPANY INFORMATION
Director
Mr S J Neal
Secretary
Mr S J Neal
Company number
01274236
Registered office
7 Pier Road
Feltham
Middlesex
United Kingdom
TW14 0TW
Auditor
AEL Markhams Ltd
2nd Floor
201 Haverstock Hill
Belsize Park
London
United Kingdom
NW3 4QG
Bankers
Barclays Bank plc
72-74 High Street
Feltham
London
TW13 4DD
National Westminster Bank Plc
Chatham Customer Service Centre
Western Avenue
Waterside
Chatham Marine
Kent
ME4 4RT
GEOFF NEAL LITHO LIMITED
CONTENTS
Page
Strategic report
1
Director's report
2 - 3
Director's responsibilities statement
4
Independent auditor's report
5 - 7
Profit and loss account
8
Statement of comprehensive income
9
Balance sheet
10
Statement of changes in equity
11
Notes to the financial statements
12 - 24
GEOFF NEAL LITHO LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 OCTOBER 2023
- 1 -

The director presents the strategic report for the year ended 31 October 2023.

Review of the business

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.

Principal risks and uncertainties

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.

Development and performance

The results for the year are considered satisfactory as is the financial position at the year end.

Key performance indicators

The performance of the business is assessed by using a variety of key performance indicators, including the measurement of turnover and profit and liquid funds.

 

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/loss before taxation £15,703 (2022: £687,612 profit).

Cash balance of £427,234 (2022: £767,590) and bank loan finance of £nil (2022: £385,495).

Other information and explanations

The company is fully aware of its social and corporate responsibilities, particularly with regard to environmental issues and is continually striving to reduce its carbon footprint. The company has been accredited with ISO 9001, ISO 14001 and ISO 27001 standards.

On behalf of the board

Mr S J Neal
Director
30 July 2024
GEOFF NEAL LITHO LIMITED
DIRECTOR'S REPORT
FOR THE YEAR ENDED 31 OCTOBER 2023
- 2 -

The director presents his annual report and financial statements for the year ended 31 October 2023.

Principal activities

The principal activities of the company continued to be that of litho printing and direct mail.

Results and dividends

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

Interim dividends of £275,435 (2022 - £244,960) were paid during the year to the parent company.

Director

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

Mr S J Neal
Financial instruments
Treasury operations and financial instruments

The company’s principal financial instruments include bank overdrafts and loans, the main purpose of which is to raise finance for the company’s operations. In addition, the company has various other financial assets and liabilities such as trade debtors and trade creditors arising directly from its operations.

Liquidity risk

The company manages its cash and borrowing requirements in order to maximise interest income and minimise interest expense, whilst ensuring the company has sufficient liquid resources to meet the operating needs of the business.

Interest rate risk

The company 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.

Credit risk

Investments of cash surpluses, borrowings and derivative instruments are made through banks and companies which must fulfil credit rating criteria approved by the Board. All customers who wish to trade on credit terms are subject to credit verification procedures. Trade debtors are monitored on an ongoing basis and provision is made for doubtful debts where necessary.

Research and development

The 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.

Post reporting date events

There have not been any events since the year end of such significance that require reference to in this report.

Future developments

The company shall continue to strive for greater production efficiency and technological advance.

 

Auditor

The auditor, AEL Markhams Ltd, is deemed to be reappointed under section 487(2) of the Companies Act 2006.

GEOFF NEAL LITHO LIMITED
DIRECTOR'S REPORT (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
- 3 -
Statement of disclosure to auditor

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

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 J Neal
Director
30 July 2024
GEOFF NEAL LITHO LIMITED
DIRECTOR'S RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 OCTOBER 2023
- 4 -

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

 

Company law requires the director to prepare financial statements for each financial year. Under that law the director has 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 director must not approve the financial statements unless he is satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the director is required to:

 

 

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

GEOFF NEAL LITHO LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF GEOFF NEAL LITHO LIMITED
- 5 -
Opinion

We have audited the financial statements of Geoff Neal Litho Limited (the 'company') for the year ended 31 October 2023 which comprise the profit and loss account, the statement of comprehensive income, the balance sheet, the statement of changes in equity and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 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 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 director's assessment of the situation and the steps the director is 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 director's use of the going concern basis of accounting in the preparation of the financial statements is appropriate. Our responsibilities and the responsibilities of the director with respect to going concern are described in the relevant sections of this report. Our report 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 director is 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:

GEOFF NEAL LITHO LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF GEOFF NEAL LITHO LIMITED (CONTINUED)
- 6 -
Matters on which we are required to report by exception

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report and the director's report.

 

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

 

Responsibilities of director

As explained more fully in the director's responsibilities statement, the director is 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 director determines 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 director is responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the director either intends to liquidate the company or to cease operations, or has 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 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.

GEOFF NEAL LITHO LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF GEOFF NEAL LITHO LIMITED (CONTINUED)
- 7 -

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.

Mr Marc Jason
Senior Statutory Auditor
For and on behalf of AEL Markhams Ltd
30 July 2024
Chartered Accountants
Statutory Auditor
2nd Floor
201 Haverstock Hill
Belsize Park
London
United Kingdom
NW3 4QG
GEOFF NEAL LITHO LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 OCTOBER 2023
- 8 -
2023
2022
Notes
£
£
Turnover
3
10,841,447
11,979,754
Cost of sales
(7,469,697)
(8,593,170)
Gross profit
3,371,750
3,386,584
Distribution costs
(148,487)
(153,106)
Administrative expenses
(3,148,008)
(2,454,803)
Operating profit
4
75,255
778,675
Interest receivable and similar income
7
4,938
812
Interest payable and similar expenses
8
(64,490)
(91,875)
Profit before taxation
15,703
687,612
Tax on profit
9
(10,664)
(168,797)
Profit for the financial year
5,039
518,815

The profit and loss account has been prepared on the basis that all operations are continuing operations.

GEOFF NEAL LITHO LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 OCTOBER 2023
- 9 -
2023
2022
£
£
Profit for the year
5,039
518,815
Other comprehensive income
-
-
Total comprehensive income for the year
5,039
518,815
GEOFF NEAL LITHO LIMITED
BALANCE SHEET
AS AT
31 OCTOBER 2023
31 October 2023
- 10 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
11
859,669
1,102,257
Current assets
Stocks
12
267,288
328,308
Debtors
13
3,197,214
4,220,111
Cash at bank and in hand
427,234
767,590
3,891,736
5,316,009
Creditors: amounts falling due within one year
14
(2,614,023)
(3,701,997)
Net current assets
1,277,713
1,614,012
Total assets less current liabilities
2,137,382
2,716,269
Creditors: amounts falling due after more than one year
15
(33,797)
(281,641)
Provisions for liabilities
Deferred tax liability
18
214,917
275,564
(214,917)
(275,564)
Net assets
1,888,668
2,159,064
Capital and reserves
Called up share capital
20
500
500
Capital redemption reserve
500
500
Profit and loss reserves
1,887,668
2,158,064
Total equity
1,888,668
2,159,064

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

The financial statements were approved and signed by the director and authorised for issue on 30 July 2024
Mr S J Neal
Director
Company registration number 01274236 (England and Wales)
GEOFF NEAL LITHO LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 OCTOBER 2023
- 11 -
Share capital
Capital redemption reserve
Profit and loss reserves
Total
Notes
£
£
£
£
Balance at 1 November 2021
500
500
1,884,209
1,885,209
Year ended 31 October 2022:
Profit and total comprehensive income
-
-
518,815
518,815
Dividends
10
-
-
(244,960)
(244,960)
Balance at 31 October 2022
500
500
2,158,064
2,159,064
Year ended 31 October 2023:
Profit and total comprehensive income
-
-
5,039
5,039
Dividends
10
-
-
(275,435)
(275,435)
Balance at 31 October 2023
500
500
1,887,668
1,888,668
GEOFF NEAL LITHO LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2023
- 12 -
1
Accounting policies
Company information

Geoff Neal Litho Limited is a private company limited by shares incorporated in England and Wales. The registered office is 7 Pier Road, Feltham, Middlesex, United Kingdom, TW14 0TW.

1.1
Accounting convention

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

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

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

This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements:

 

- Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;

- Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues’: Interest income/expense and net gains/losses for each category of financial instrument; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;

- Section 26 ‘Share based Payment’: Share-based payment expense charged to profit or loss, reconciliation of opening and closing number and weighted average exercise price of share options, how the fair value of options granted was measured, measurement and carrying amount of liabilities for cash-settled share-based payments, explanation of modifications to arrangements;

- Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.

 

The financial statements of the company are consolidated in the financial statements of JPO Communications Ltd. These consolidated financial statements are available from its registered office address.

1.2
Going concern

These financial statements are prepared on the going concern basis. The director has a reasonable expectation that the company will continue in operational existence for the foreseeable future. However, the director is aware of certain material uncertainties which may cause doubt on the company's ability to continue as a going concern.

 

The director 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 director has therefore concluded that these circumstances give rise to a material uncertainty. However, based on their assessment and the current resources available, the director continues to adopt the going concern basis in preparing the annual report and accounts.

 

1.3
Turnover

Turnover represents amounts receivable for goods and services net of VAT and trade discounts.

GEOFF NEAL LITHO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
1
Accounting policies
(Continued)
- 13 -

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.

1.4
Tangible fixed assets

Plant and equipment is stated at cost less accumulated depreciation and any recognised impairment losses.

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

Plant and machinery
10-25% Reducing balance/Straight line
Fixtures, fittings & equipment
25% Reducing balance/Straight line

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

1.5
Impairment of fixed assets

At each reporting period end date, the company reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

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

 

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

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.

1.6
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.

 

GEOFF NEAL LITHO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
1
Accounting policies
(Continued)
- 14 -

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.

1.7
Cash and cash equivalents

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

1.8
Financial instruments

The company 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 company's balance sheet when the company becomes party to the contractual provisions of the instrument.

 

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

Basic financial assets

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

Other financial assets

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

Impairment of financial assets

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

 

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

 

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

Derecognition of financial assets

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

GEOFF NEAL LITHO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
1
Accounting policies
(Continued)
- 15 -
Classification of financial liabilities

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.

Basic financial liabilities

Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

 

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

 

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

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 company’s contractual obligations expire or are discharged or cancelled.

1.9
Equity instruments

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

1.10
Taxation

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

Current tax

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

GEOFF NEAL LITHO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
1
Accounting policies
(Continued)
- 16 -
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 when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

1.11
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.

1.12
Retirement benefits

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

1.13
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 leases asset are consumed.

1.14
Foreign exchange

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.

GEOFF NEAL LITHO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
- 17 -
2
Judgements and key sources of estimation uncertainty

In the application of the company’s accounting policies, the director is 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.

3
Turnover and other revenue

An analysis of the company's turnover is as follows:

2023
2022
£
£
Turnover analysed by class of business
Sales of goods
10,841,447
11,979,754
2023
2022
£
£
Other revenue
Interest income
4,938
812

 

4
Operating profit
2023
2022
Operating profit for the year is stated after charging/(crediting):
£
£
Fees payable to the company's auditor for the audit of the company's financial statements
18,000
21,000
Depreciation of owned tangible fixed assets
120,117
182,337
Depreciation of tangible fixed assets held under finance leases
182,000
(94,687)
Profit on disposal of tangible fixed assets
-
(704,913)
Operating lease charges
129,081
144,885
GEOFF NEAL LITHO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
- 18 -
5
Employees

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

2023
2022
Number
Number
Sales, production and administration
49
55
Directors
1
2
Total
50
57
2023
2022
£
£
Wages and salaries
2,073,523
2,276,079
Social security costs
227,255
261,842
Pension costs
56,496
60,762
2,357,274
2,598,683
6
Director's remuneration
2023
2022
£
£
Remuneration for qualifying services
14,775
32,610
Company pension contributions to defined contribution schemes
-
220
14,775
32,830

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

7
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
4,938
812
GEOFF NEAL LITHO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
- 19 -
8
Interest payable and similar expenses
2023
2022
£
£
Interest on bank overdrafts and loans
46,841
51,888
Other interest on financial liabilities
4,307
5,281
Interest on finance leases and hire purchase contracts
13,342
34,706
64,490
91,875
9
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
71,311
-
0
Deferred tax
Origination and reversal of timing differences
(60,647)
168,797
Total tax charge
10,664
168,797

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
15,703
687,612
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00% (2022: 19.00%)
3,926
130,646
Tax effect of expenses that are not deductible in determining taxable profit
14,809
8,882
Effect of change in corporation tax rate
(7,861)
66,136
Group relief
-
0
25,302
Permanent capital allowances in excess of depreciation
(210)
-
0
Research and development tax credit
-
0
(62,169)
Taxation charge for the year
10,664
168,797

The main corporation tax rate increased to 25% from 1 April 2023, the deferred tax provision has been calculated using this 25% rate (2022 : 25%).

 

GEOFF NEAL LITHO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
- 20 -
10
Dividends
2023
2022
£
£
Interim paid
275,435
244,960
11
Tangible fixed assets
Plant and machinery
Fixtures, fittings & equipment
Total
£
£
£
Cost
At 1 November 2022
3,199,861
515,400
3,715,261
Additions
59,529
-
0
59,529
At 31 October 2023
3,259,390
515,400
3,774,790
Depreciation and impairment
At 1 November 2022
2,119,345
493,659
2,613,004
Depreciation charged in the year
290,144
11,973
302,117
At 31 October 2023
2,409,489
505,632
2,915,121
Carrying amount
At 31 October 2023
849,901
9,768
859,669
At 31 October 2022
1,080,516
21,741
1,102,257

The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.

2023
2022
£
£
Plant and machinery
662,396
796,146

Finance leases or hire purchase contracts are secured on the specific assets financed. The book value of the assets secured is disclosed above.

12
Stocks
2023
2022
£
£
Raw materials and consumables
192,827
231,853
Work in progress
74,461
96,455
267,288
328,308
GEOFF NEAL LITHO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
- 21 -
13
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
1,833,103
2,476,305
Amounts owed by group undertakings
1,249,990
1,638,850
Other debtors
26,909
300
Prepayments and accrued income
87,212
104,656
3,197,214
4,220,111
14
Creditors: amounts falling due within one year
2023
2022
Notes
£
£
Bank loans
16
-
0
148,672
Obligations under finance leases
17
41,010
307,106
Trade creditors
2,081,057
2,504,750
Corporation tax
71,311
-
0
Other taxation and social security
62,816
65,616
Other creditors
186,115
286,290
Accruals and deferred income
171,714
389,563
2,614,023
3,701,997

Finance leases and hire purchase contracts are secured on the specific assets financed. Included in other creditors above is £36,698 (2022 - £80,000) in respect of a finance arrangement for various items of Kodak and Nela equipment. The liability is secured on the assets concerned.

 

 

15
Creditors: amounts falling due after more than one year
2023
2022
Notes
£
£
Bank loans and overdrafts
16
-
0
236,823
Obligations under finance leases
17
33,797
26,557
Other creditors
-
0
18,261
33,797
281,641

Finance leases and hire purchase contracts are secured on the specific assets financed.

 

GEOFF NEAL LITHO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
- 22 -
16
Loans and overdrafts
2023
2022
£
£
Bank loans
-
0
385,495
Payable within one year
-
0
148,672
Payable after one year
-
0
236,823

The bank loan with Close Brothers was repaid in June 2023.

17
Finance lease obligations
2023
2022
Future minimum lease payments due under finance leases:
£
£
Within one year
45,300
320,448
In two to five years
37,192
26,704
82,492
347,152
Less: future finance charges
(7,685)
(13,489)
74,807
333,663

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 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.

18
Deferred taxation

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

Liabilities
Liabilities
2023
2022
Balances:
£
£
Accelerated capital allowances
214,917
275,564
2023
Movements in the year:
£
Liability at 1 November 2022
275,564
Credit to profit or loss
(60,647)
Liability at 31 October 2023
214,917
GEOFF NEAL LITHO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
18
Deferred taxation
(Continued)
- 23 -

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.

19
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
56,496
60,762

The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.

20
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
500
500
500
500
21
Operating lease commitments
Lessee

At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

2023
2022
£
£
Within one year
81,381
70,948
Between two and five years
92,218
84,848
173,599
155,796
22
Related party transactions
Remuneration of key management personnel

The directors are regarded as the key management personnel. Directors' remuneration is disclosed in another note.

Transactions with related parties
Sales
Sales
Purchases
Purchases
2023
2022
2023
2022
£
£
£
£
Entities over which the entity has control, joint control or significant influence
-
0
163,202
-
297,404
GEOFF NEAL LITHO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
22
Related party transactions
(Continued)
- 24 -
Services received
2023
2022
£
£
Entities over which the entity has control, joint control or significant influence
36,216
44,233

The amounts shown above are inclusive of VAT where applicable.

2023
2022
Amounts due to related parties
£
£
Entities over which the entity has control, joint control or significant influence
3,210
6,909

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.

23
Ultimate controlling party

The parent company of Geoff Neal Litho Limited is JPO Communications Ltd and its registered office is 7 Pier Road, Feltham, Middlesex, TW14 0TW. The parent company is owned and controlled by its directors, Mr. S. Neal and Mrs. C. Neal.

 

Largest group
JPO Communications Ltd
Smallest group
JPO Communications Ltd

JPO Communications Ltd owns 100% of Geoff Neal Litho Ltd. There are no other companies in the group. The financial results of Geoff Neal Litho Ltd are included in the consolidated group accounts of JPO Communications Ltd.

 

 

Guarantees and Security

 

Geoff Neal Litho Ltd has given a cross guarantee to NatWest Bank plc in respect of bank loans owing by JPO Communications Ltd. The loan balances at the year end date totalled £1,171,021.

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