Company registration number 03642932 (England and Wales)
HORTON COMMERCIALS LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
HORTON COMMERCIALS LIMITED
COMPANY INFORMATION
Directors
D Wolfenden
Mr T A D Wolfenden
(Appointed 1 January 2024)
Mr T Wolfenden
(Appointed 1 January 2024)
Mrs S Wolfenden-Smith
(Appointed 1 January 2024)
Secretary
J Wolfenden
Company number
03642932
Registered office
C/O Azets
Secure House
Lulworth Close
Chandlers Ford
Southampton
Hampshire
United Kingdom
SO53 3TL
Auditor
Azets Audit Services
Secure House
Lulworth Close
Chandlers Ford
Southampton
Hampshire
United Kingdom
SO53 3TL
HORTON COMMERCIALS LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2 - 3
Independent auditor's report
4 - 6
Group statement of comprehensive income
7
Group balance sheet
8
Company balance sheet
9
Group statement of changes in equity
10
Company statement of changes in equity
11
Group statement of cash flows
12
Company statement of cash flows
13
Notes to the financial statements
14 - 33
HORTON COMMERCIALS LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -
The directors present the strategic report for the year ended 31 December 2023.
Review of the business
The company acquired its first subsidiary company, Blackmore Vale Leisure Limited, on 17 November 2022 strengethening the existing motorhome and caravan offering. This is the first year in which the group accounts include a full year of Blackmore Vale Leisure Limited financial figures.
On a like for like basis, the group continued to acheive excellent results during 2023, with sales increasing by 36% over sales acheived in 2022, which were an increase of 29% on sales acheived in 2021.
The results for the group show a pre-tax profit of £3,425,923 (2022 - £3,773,667) for the year and sales of £24,054,070 (2022 - £18,009,633).
At the year end the group had increased the total assets less current liabilities from £16,915,627 in 2022 to £19,452,541 in 2023.
The group's key financial and other performance indicators during the year were as follows:
Principal risks and uncertainties
The vehicle rental market in the South of England is highly competitive and the group strives to distinguish itself from its competitors by providing exceptional customer service.
Appropriate consideration is given to risk management objectives and policies. Facilities are in place to deal with cashflow and liquidity risk. Risk to pricing is mitigated by a diverse supplier portfolio. Credit risk is managed through the adoption of a rigorous credit policy.
D Wolfenden
Director
29 July 2024
HORTON COMMERCIALS LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
The directors present their annual report and financial statements for the year ended 31 December 2023.
Principal activities
The principal activity of the company and the group continued to be that of the rental and sale of cars, vans, motorhomes and caravans and the maintenance and repair of motor vehicles.
Results and dividends
The results for the year are set out on page 7.
Ordinary dividends were paid amounting to £285,100. 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:
D Wolfenden
Mr T A D Wolfenden
(Appointed 1 January 2024)
Mr T Wolfenden
(Appointed 1 January 2024)
Mrs S Wolfenden-Smith
(Appointed 1 January 2024)
Financial instruments
Price risk, credit risk, liquidity risk and cash flow risk
The business' principal financial instruments comprise bank balances, trade debtors, trade creditors and finance lease agreements. The main purpose of these instruments is to finance the business' operations.
All of the business' cash balances are held in such a way that achieves a competitive rate of interest.
Trade debtors are managed in respect of credit and cash flow risk by policies concerning the credit offered to customers and the regular monitoring of amounts outstanding for both time and credit limits.
Trade creditors liquidity risk is managed by ensuring sufficient funds are available to meet amounts due.
The business is a lessee in respect of finance leased assets. The liquidity risk in respect of these is managed by ensuring that there are sufficient funds to meet the payments.
HORTON COMMERCIALS LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -
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:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the ;
prepare the on the going concern basis unless it is inappropriate to presume that the group and company will continue in business.
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.
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.
On behalf of the board
D Wolfenden
Director
29 July 2024
HORTON COMMERCIALS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF HORTON COMMERCIALS LIMITED
- 4 -
Opinion
We have audited the financial statements of Horton Commercials Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 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:
give a true and fair view of the state of the group's and the parent company's affairs as at 31 December 2023 and of the group's profit for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the 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.
The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit:
the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
HORTON COMMERCIALS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF HORTON COMMERCIALS LIMITED
- 5 -
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:
adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or
the parent company financial statements are not in agreement with the accounting records and returns; or
certain disclosures of directors' remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
Responsibilities of the 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.
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.
HORTON COMMERCIALS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF HORTON COMMERCIALS LIMITED
- 6 -
Extent to which the audit was considered capable of detecting irregularities, including fraud
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above and on the Financial Reporting Council’s website, to detect material misstatements in respect of irregularities, including fraud.
We obtain and update our understanding of the entity, its activities, its control environment, and likely future developments, including in relation to the legal and regulatory framework applicable and how the entity is complying with that framework. Based on this understanding, we identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. This includes consideration of the risk of acts by the entity that were contrary to applicable laws and regulations, including fraud.
In response to the risk of irregularities and non-compliance with laws and regulations, including fraud, we designed procedures which included:
Enquiry of management and those charged with governance around actual and potential litigation and claims as well as actual, suspected and alleged fraud;
Assessing the extent of compliance with the laws and regulations considered to have a direct material effect on the financial statements or the operations of the entity through enquiry and inspection;
Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations;
Performing audit work over the risk of management bias and override of controls, including testing of journal entries and other adjustments for appropriateness, evaluating the business rationale of significant transactions outside the normal course of business and reviewing accounting estimates for indicators of potential bias.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
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.
Michael Wesley FCA (Senior Statutory Auditor)
For and on behalf of Azets Audit Services
31 July 2024
Chartered Accountants
Statutory Auditor
Secure House
Lulworth Close
Chandlers Ford
Southampton
Hampshire
SO53 3TL
HORTON COMMERCIALS LIMITED
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
- 7 -
2023
2022
Notes
£
£
Turnover
3
24,054,070
18,009,633
Cost of sales
(15,688,355)
(9,307,697)
Gross profit
8,365,715
8,701,936
Administrative expenses
(4,502,341)
(4,709,886)
Other operating income
-
1,200
Operating profit
4
3,863,374
3,993,250
Interest receivable and similar income
8
102
17,154
Interest payable and similar expenses
9
(437,553)
(236,737)
Profit before taxation
3,425,923
3,773,667
Tax on profit
10
(869,792)
(777,627)
Profit for the financial year
25
2,556,131
2,996,040
Profit for the financial year is all attributable to the owners of the parent company.
Total comprehensive income for the year is all attributable to the owners of the parent company.
HORTON COMMERCIALS LIMITED
GROUP BALANCE SHEET
AS AT 31 DECEMBER 2023
31 December 2023
- 8 -
2023
2022
Notes
£
£
£
£
Fixed assets
Goodwill
12
1,631,880
1,890,784
Tangible assets
13
20,090,345
17,735,923
21,722,225
19,626,707
Current assets
Stocks
16
5,066,563
1,640,230
Debtors
17
2,171,399
2,371,796
Cash at bank and in hand
799,301
284,434
8,037,263
4,296,460
Creditors: amounts falling due within one year
18
(10,306,947)
(7,007,540)
Net current liabilities
(2,269,684)
(2,711,080)
Total assets less current liabilities
19,452,541
16,915,627
Creditors: amounts falling due after more than one year
19
(4,649,063)
(4,577,471)
Provisions for liabilities
Deferred tax liability
22
640,077
445,786
(640,077)
(445,786)
Net assets
14,163,401
11,892,370
Capital and reserves
Called up share capital
24
100
100
Profit and loss reserves
25
14,163,301
11,892,270
Total equity
14,163,401
11,892,370
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
D Wolfenden
Director
Company registration number 03642932 (England and Wales)
HORTON COMMERCIALS LIMITED
COMPANY BALANCE SHEET
AS AT 31 DECEMBER 2023
31 December 2023
- 9 -
2023
2022
Notes
£
£
£
£
Fixed assets
Goodwill
12
75,122
Tangible assets
13
20,046,749
17,727,824
Investments
14
2,933,675
3,933,675
22,980,424
21,736,621
Current assets
Stocks
16
3,845,248
1,131,463
Debtors
17
2,037,256
2,340,887
Cash at bank and in hand
606,081
121,332
6,488,585
3,593,682
Creditors: amounts falling due within one year
18
(9,925,029)
(8,377,202)
Net current liabilities
(3,436,444)
(4,783,520)
Total assets less current liabilities
19,543,980
16,953,101
Creditors: amounts falling due after more than one year
19
(4,649,063)
(4,577,471)
Provisions for liabilities
Deferred tax liability
22
640,077
445,786
(640,077)
(445,786)
Net assets
14,254,840
11,929,844
Capital and reserves
Called up share capital
24
100
100
Profit and loss reserves
25
14,254,740
11,929,744
Total equity
14,254,840
11,929,844
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 £2,610,096 (2022 - £3,033,514 profit).
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
D Wolfenden
Director
Company registration number 03642932 (England and Wales)
HORTON COMMERCIALS LIMITED
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 10 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 January 2022
100
10,201,930
10,202,030
Year ended 31 December 2022:
Profit and total comprehensive income for the year
-
2,996,040
2,996,040
Dividends
11
-
(1,305,700)
(1,305,700)
Balance at 31 December 2022
100
11,892,270
11,892,370
Year ended 31 December 2023:
Profit and total comprehensive income for the year
-
2,556,131
2,556,131
Dividends
11
-
(285,100)
(285,100)
Balance at 31 December 2023
100
14,163,301
14,163,401
HORTON COMMERCIALS LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 11 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 January 2022
100
10,201,930
10,202,030
Year ended 31 December 2022:
Profit and total comprehensive income for the year
-
3,033,514
3,033,514
Dividends
11
-
(1,305,700)
(1,305,700)
Balance at 31 December 2022
100
11,929,744
11,929,844
Year ended 31 December 2023:
Profit and total comprehensive income for the year
-
2,610,096
2,610,096
Dividends
11
-
(285,100)
(285,100)
Balance at 31 December 2023
100
14,254,740
14,254,840
HORTON COMMERCIALS LIMITED
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 12 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
31
5,579,513
8,267,856
Interest paid
(437,553)
(236,737)
Income taxes paid
(840,921)
(675,994)
Net cash inflow from operating activities
4,301,039
7,355,125
Investing activities
Purchase of tangible fixed assets
(3,321,212)
(1,987,904)
Proceeds on disposal of tangible fixed assets
2,928,301
1,714,498
Purchase of subsidiary
-
(3,933,675)
Cash acquired with subsidiary
-
341,063
Interest received
102
17,154
Net cash used in investing activities
(392,809)
(3,848,864)
Financing activities
Proceeds of new loans
300,000
1,758,750
Repayment of bank loans
(74,596)
(346,088)
Repayment of other loans
(12,713)
(157,780)
Payment of finance leases obligations
(4,211,350)
(3,612,924)
Dividends paid
(285,100)
(1,305,700)
Net cash used in financing activities
(4,283,759)
(3,663,742)
Net decrease in cash and cash equivalents
(375,529)
(157,481)
Cash and cash equivalents at beginning of year
(45,926)
111,555
Cash and cash equivalents at end of year
(421,455)
(45,926)
Relating to:
Cash at bank and in hand
799,301
284,434
Bank overdrafts included in creditors payable within one year
(1,220,756)
(330,360)
HORTON COMMERCIALS LIMITED
COMPANY STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 13 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
32
5,425,288
8,446,186
Interest paid
(437,553)
(237,106)
Income taxes paid
(754,275)
(675,994)
Net cash inflow from operating activities
4,233,460
7,533,086
Investing activities
Purchase of tangible fixed assets
(3,278,208)
(1,987,904)
Proceeds on disposal of tangible fixed assets
2,922,860
1,714,498
Purchase of subsidiary
-
(3,933,675)
Interest received
17,154
Net cash used in investing activities
(355,348)
(4,189,927)
Financing activities
Proceeds of new loans
300,000
1,758,750
Repayment of bank loans
(74,596)
(346,088)
Repayment of other loans
(12,713)
(157,780)
Payment of finance leases obligations
(4,211,350)
(3,612,924)
Dividends paid to equity shareholders
(285,100)
(1,305,700)
Net cash used in financing activities
(4,283,759)
(3,663,742)
Net decrease in cash and cash equivalents
(405,647)
(320,583)
Cash and cash equivalents at beginning of year
(209,028)
111,555
Cash and cash equivalents at end of year
(614,675)
(209,028)
Relating to:
Cash at bank and in hand
606,081
121,332
Bank overdrafts included in creditors payable within one year
(1,220,756)
(330,360)
HORTON COMMERCIALS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 14 -
1
Accounting policies
Company information
Horton Commercials Limited is a private company limited by shares incorporated in England and Wales. The
registered office is C/O Azets, Lulworth Close, Chanders Ford, Hampshire, SO53 3TL.
The principal place of business is:
13-19 Johnson Road
Ferndown Industrial Estate
Ferndown
Dorset
BH21 7SE
The group consists of Horton Commercials Limited and its subsidiary, Blackmore Vale Leisure Ltd.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
1.2
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 Horton Commercials Limited together with all entities controlled by the parent company (its subsidiaries).
All financial statements are made up to 31 December 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.
HORTON COMMERCIALS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 15 -
Subsidiaries are consolidated in the group’s financial statements from the date that control commences until the date that control ceases. The sole subsidiary, Blackmore Vale Leisure Ltd, was acquired on 17 November 2022.
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 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 discounts and rebates.
Revenue from the renting of hire cars, vans and motorhomes is recognised over the length of the hire period. Revenue from maintenance and repair of motor vehicles is recognised on completion of the works.
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 10 years.
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
33 1/3% straight line
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.
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
25% reducing balance
Office equipment
33 1/3% straight line
Fixtures and fittings
33 1/3% straight line
Motor vehicles
25% reducing balance
Freehold land and buildings
2% and 10% 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 recognised in the profit and loss account.
HORTON COMMERCIALS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 16 -
1.9
Fixed asset investments
Interests in subsidiaries are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.
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.
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.
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 and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
HORTON COMMERCIALS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 17 -
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.
HORTON COMMERCIALS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 18 -
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.
HORTON COMMERCIALS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 19 -
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the 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.
1.19
Government grants
Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.
A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.
HORTON COMMERCIALS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 20 -
2
Judgements and key sources of estimation uncertainty
In the application of the group’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The 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.
In preparing these financial statements, the director has made the following judgements:
Determine whether leases entered into by the group and company are operating or finance leases. These decisions depend on an assessment of whether the risks and rewards of ownership have been transferred from the lessor to the lessee on a lease by lease basis.
Determine whether there are any indicators of impairment of the group's and company's tangible fixed assets. Factors taken into consideration in reaching such a decision include the economic viability and expected future financial performance of the asset.
Determine whether other borrowings are classified as current or non-current borrowings. These decisions depend on the cash flow requirements of the group and whether the other borrowings can be repaid.
Key sources of estimation uncertainty
Tangible fixed assets, other than land and properties under construction, are depreciated over their useful lives taking into account residual values, where appropriate. The actual lives of the assets and residual values are assessed annually and may vary depending on a number of factors. In re-assessing assets lives, factors such as technological innovation, product life cycles and maintenance programmes are taken into account. Residual value assessments consider issues such as future market conditions, the remaining life of the asset and projected disposal values.
3
Turnover and other revenue
2023
2022
£
£
Turnover analysed by geographical market
UK
24,054,070
18,009,633
2023
2022
£
£
Other revenue
Interest income
102
17,154
Grants received
-
1,200
HORTON COMMERCIALS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 21 -
4
Operating profit
2023
2022
£
£
Operating profit for the year is stated after charging/(crediting):
Government grants
-
(1,200)
Depreciation of owned tangible fixed assets
497,951
582,352
Depreciation of tangible fixed assets held under finance leases
2,937,747
2,765,041
Profit on disposal of tangible fixed assets
(1,673,363)
(955,596)
Amortisation of intangible assets
258,904
97,286
Operating lease charges
246,564
272,966
5
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the group and company
24,505
16,250
6
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
Director
1
1
1
1
Production
48
39
42
36
Administration and sales
52
48
47
43
Total
101
88
90
80
Their aggregate remuneration comprised:
Group
Company
2023
2022
2023
2022
£
£
£
£
Wages and salaries
3,073,480
2,455,119
2,831,560
2,429,637
Social security costs
292,767
246,624
271,317
243,619
Pension costs
40,296
39,427
34,578
39,427
3,406,543
2,741,170
3,137,455
2,712,683
HORTON COMMERCIALS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
6
Employees
(Continued)
- 22 -
It was identified that wages and salaries expenditure of £92,639 had been recorded as pension costs in 2022. The comparative pensions cost figure has been amended from £132,066 as recorded in the 2022 financial statements to £39,427 to reflect the pension cost incurred in that year. There has been no change to the aggregate remuneration cost for the year ended 31 December 2022.
7
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
1,600
9,360
8
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
102
17,154
2023
2022
Investment income includes the following:
£
£
Interest on financial assets not measured at fair value through profit or loss
102
17,154
9
Interest payable and similar expenses
2023
2022
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
129,276
12,209
Other finance costs:
Interest on finance leases and hire purchase contracts
304,098
224,528
Other interest
4,179
-
Total finance costs
437,553
236,737
10
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
677,043
661,657
Adjustments in respect of prior periods
(1,542)
Total current tax
675,501
661,657
HORTON COMMERCIALS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
10
Taxation
2023
2022
£
£
(Continued)
- 23 -
Deferred tax
Origination and reversal of timing differences
194,291
115,970
Total tax charge
869,792
777,627
As of 1 April 2023, the main rate of UK corporation tax increased from 19% to 25%. As the company's financial year straddles the date of the change in corporation tax rates, a blended corporation tax rate of 23.52% has been applied which is calculated by apportioning the two tax rates on a weighted basis for the proportion of the financial year for which each main tax rate was applicable.
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
3,425,923
3,773,667
Expected tax charge based on the standard rate of corporation tax in the UK of 23.52% (2022: 19.00%)
805,777
716,997
Tax effect of expenses that are not deductible in determining taxable profit
1,316
3,427
Unutilised tax losses carried forward
2,911
Change in unrecognised deferred tax assets
(3,072)
Adjustments in respect of prior years
(1,542)
Depreciation on assets not qualifying for tax allowances
22,134
Amortisation on assets not qualifying for tax allowances
60,895
18,484
Tax at marginal rate
6,418
13,674
Taxation charge
869,792
777,627
11
Dividends
2023
2022
Recognised as distributions to equity holders:
£
£
Interim paid
285,100
1,305,700
HORTON COMMERCIALS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 24 -
12
Intangible fixed assets
Group
Goodwill
Software
Total
£
£
£
Cost
At 1 January 2023 and 31 December 2023
3,340,446
162,510
3,502,956
Amortisation and impairment
At 1 January 2023
1,449,662
162,510
1,612,172
Amortisation charged for the year
258,904
258,904
At 31 December 2023
1,708,566
162,510
1,871,076
Carrying amount
At 31 December 2023
1,631,880
1,631,880
At 31 December 2022
1,890,784
1,890,784
Company
Goodwill
Software
Total
£
£
£
Cost
At 1 January 2023 and 31 December 2023
1,502,630
162,510
1,665,140
Amortisation and impairment
At 1 January 2023
1,427,508
162,510
1,590,018
Amortisation charged for the year
75,122
75,122
At 31 December 2023
1,502,630
162,510
1,665,140
Carrying amount
At 31 December 2023
At 31 December 2022
75,122
75,122
HORTON COMMERCIALS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 25 -
13
Tangible fixed assets
Group
Fixtures and fittings
Motor vehicles
Freehold land and buildings
Other property, plant and equipment
Total
£
£
£
£
£
Cost
At 1 January 2023
530,000
20,354,394
6,672,578
912,058
28,469,030
Additions
42,387
4,592,375
2,314,306
95,990
7,045,058
Disposals
(3,831,863)
(14,500)
(3,846,363)
At 31 December 2023
572,387
21,114,906
8,986,884
993,548
31,667,725
Depreciation and impairment
At 1 January 2023
439,239
9,226,566
412,418
654,884
10,733,107
Depreciation charged in the year
63,926
3,148,419
134,142
89,211
3,435,698
Eliminated in respect of disposals
(2,584,855)
(6,570)
(2,591,425)
At 31 December 2023
503,165
9,790,130
546,560
737,525
11,577,380
Carrying amount
At 31 December 2023
69,222
11,324,776
8,440,324
256,023
20,090,345
At 31 December 2022
90,761
11,127,828
6,260,160
257,174
17,735,923
Company
Fixtures and fittings
Motor vehicles
Freehold land and buildings
Other property, plant and equipment
Total
£
£
£
£
£
Cost
At 1 January 2023
528,936
20,349,091
6,670,805
911,962
28,460,794
Additions
34,986
4,574,375
2,297,705
94,988
7,002,054
Disposals
(3,828,063)
(14,500)
(3,842,563)
At 31 December 2023
563,922
21,095,403
8,968,510
992,450
31,620,285
Depreciation and impairment
At 1 January 2023
439,221
9,226,456
412,411
654,882
10,732,970
Depreciation charged in the year
62,471
3,143,523
133,633
88,737
3,428,364
Eliminated in respect of disposals
(2,581,228)
(6,570)
(2,587,798)
At 31 December 2023
501,692
9,788,751
546,044
737,049
11,573,536
Carrying amount
At 31 December 2023
62,230
11,306,652
8,422,466
255,401
20,046,749
At 31 December 2022
89,715
11,122,635
6,258,394
257,080
17,727,824
HORTON COMMERCIALS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
13
Tangible fixed assets
(Continued)
- 26 -
The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.
Group
Company
2023
2022
2023
2022
£
£
£
£
Motor vehicles
10,860,747
9,623,663
10,860,747
9,623,663
Depreciation charge for the year in respect of leased assets
2,937,747
2,765,041
2,937,747
2,765,041
14
Fixed asset investments
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Investments in subsidiaries
15
2,933,675
3,933,675
Movements in fixed asset investments
Company
Shares in subsidiaries
£
Cost or valuation
At 1 January 2023 and 31 December 2023
3,933,675
Impairment
At 1 January 2023
-
Impairment losses
1,000,000
At 31 December 2023
1,000,000
Carrying amount
At 31 December 2023
2,933,675
At 31 December 2022
3,933,675
15
Subsidiaries
Details of the company's subsidiaries at 31 December 2023 are as follows:
Name of undertaking
Registered office
Class of
% Held
shares held
Direct
Blackmore Vale Leisure Ltd
C/O Azets, Secure House, Lulworth Close, Chandler's Ford, Southampton, Hampshire, UK, SO53 3TL
Ordinary
100.00
HORTON COMMERCIALS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 27 -
16
Stocks
Group
Company
2023
2022
2023
2022
£
£
£
£
Work in progress
186,666
179,581
186,666
179,581
Finished goods and goods for resale
4,879,897
1,460,649
3,658,582
951,882
5,066,563
1,640,230
3,845,248
1,131,463
17
Debtors
Group
Company
2023
2022
2023
2022
Amounts falling due within one year:
£
£
£
£
Trade debtors
1,357,053
1,393,222
1,356,468
1,393,222
Other debtors
663,734
870,378
585,362
868,271
Prepayments and accrued income
150,612
108,196
95,426
79,394
2,171,399
2,371,796
2,037,256
2,340,887
18
Creditors: amounts falling due within one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Bank loans and overdrafts
20
1,297,933
389,598
1,297,933
389,598
Obligations under finance leases
21
3,317,431
3,734,832
3,317,431
3,734,832
Other borrowings
20
53,057
53,057
Trade creditors
4,100,865
1,240,512
3,415,100
1,217,897
Amounts owed to group undertakings
414,023
1,549,169
Corporation tax payable
412,159
577,579
381,342
490,932
Other taxation and social security
338,567
446,902
333,549
418,145
Other creditors
468,141
310,004
395,218
248,820
Accruals and deferred income
318,794
308,113
317,376
327,809
10,306,947
7,007,540
9,925,029
8,377,202
Included within bank loans and overdrafts are borrowings of £77,177 (2022 - £nil) secured by a fixed charge over property owned by the group and company.
HORTON COMMERCIALS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 28 -
19
Creditors: amounts falling due after more than one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Bank loans and overdrafts
20
1,602,802
1,695,337
1,602,802
1,695,337
Obligations under finance leases
21
2,812,031
2,882,134
2,812,031
2,882,134
Other borrowings
20
234,230
234,230
4,649,063
4,577,471
4,649,063
4,577,471
Included within bank loans and overdrafts are borrowings of £1,602,802 (2022 - £nil) secured by a fixed charge over property owned by the group and company.
20
Loans and overdrafts
Group
Company
2023
2022
2023
2022
£
£
£
£
Bank loans
1,679,979
1,754,575
1,679,979
1,754,575
Bank overdrafts
1,220,756
330,360
1,220,756
330,360
Other loans
287,287
287,287
3,188,022
2,084,935
3,188,022
2,084,935
Payable within one year
1,350,990
389,598
1,350,990
389,598
Payable after one year
1,837,032
1,695,337
1,837,032
1,695,337
Bank loans
Bank loans of £1,679,979 (2022 - £1,754,575) are secured by a fixed charge over properties owned by the company and a cross guarantee and debenture between the company's subsidiary, Blackmore Vale Leisure Limited.
Overdraft facility
The company has an overdraft facility that is secured by fixed and floating charges over the undertaking and all property and assets present and future including book and all other debts. There is also a cross guarantee and debenture between Blackmore Vale Leisure Limited.
21
Finance lease obligations
Group
Company
2023
2022
2023
2022
£
£
£
£
Future minimum lease payments due under finance leases:
Within one year
3,317,431
3,445,678
3,317,431
3,445,678
In two to five years
2,812,031
3,171,288
2,812,031
3,171,288
6,129,462
6,616,966
6,129,462
6,616,966
HORTON COMMERCIALS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
21
Finance lease obligations
(Continued)
- 29 -
All finance lease and hire purchase agreements are secured by a first fixed charge over the asset purchased.
22
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
642,113
449,818
Retirement benefit obligations
(2,036)
(4,032)
640,077
445,786
Liabilities
Liabilities
2023
2022
Company
£
£
Accelerated capital allowances
642,113
449,818
Retirement benefit obligations
(2,036)
(4,032)
640,077
445,786
Group
Company
2023
2023
Movements in the year:
£
£
Liability at 1 January 2023
445,786
445,786
Charge to profit or loss
194,291
194,291
Liability at 31 December 2023
640,077
640,077
The deferred tax balance in relation to accelerated capital allowances is expected to reverse in more than 12 months. The deferred tax balance in relation to retirement benefits is expected to reverse within 12 months.
23
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
40,296
39,427
HORTON COMMERCIALS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
23
Retirement benefit schemes
(Continued)
- 30 -
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.
The charge to the profit and loss account recorded in the 2022 financial statements was £132,066. It was identified that wages and salaries expenditure of £92,639 had been recorded as pension expense in 2022. The comparative figure has been amended to reflect the pension cost incurred in the year ended 31 December 2022. There has been no change to the aggregate remuneration cost for the year ended 31 December 2022.
24
Share capital
Group and company
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary A shares of £1 each
75
75
75
75
Ordinary B shares of £1 each
9
9
9
9
Ordinary C shares of £1 each
5
5
5
5
Ordinary D shares of £1 each
5
5
5
5
Ordinary E shares of £1 each
5
5
5
5
Ordinary F shares of £1 each
1
1
1
1
100
100
100
100
Each share is entitled to one vote in any circumstances and each share is also entitled pari passu to any distributions, including a distribution arising from a winding up of the company, except that the Directors may pay interim or final dividends on one or several classes of shares to the exclusion of any class or classes and may pay these dividends at different rates on the respective classes of shares.
25
Reserves
Profit and loss reserves
The profit and loss account is cumulative profits generated by the company less distributions to shareholders via dividends. These are either reinvested in the business or kept as a reserve for specific objectives.
26
Capital commitments
The company renews its fleet of vehicles throughout the year. At any point in time, capital commitments exist for the acquisition of new vehicles. The period from the date of commitment to the delivery of the vehicle is in general up to three months, with the monthly commitment being approximately £460,000.
HORTON COMMERCIALS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 31 -
27
Operating lease commitments
Lessee
At the reporting end date the group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
Group
Company
2023
2022
2023
2022
£
£
£
£
Within one year
325,140
280,900
325,140
280,900
Between two and five years
789,545
282,363
789,545
282,363
In over five years
170,573
-
170,573
-
1,285,258
563,263
1,285,258
563,263
28
Related party transactions
Transactions with related parties
During the year the group entered into the following transactions with related parties:
D J Wolfenden, the director; J M Wolfenden, the company secretary and the Horton Commercial Pension Scheme
The group was charged a commercial rent of £242,475 (2022 - £273,500) paid partly to D J Wolfenden, J M Wolfenden and the Horton Commercial Pension Scheme.
During the year, a loan of £300,000 was made to the group from the Horton Commercial Pension Scheme. The loan is repayable by 1 October 2028 and is repaid by equal instalments with interest charged at 7% per annum. During the year interest of £5,017 (2022 - £nil) was incurred. At the year end, the total liability in respect of this loan was £287,287 (2022 - £nil).
Other related parties
Dividends totalling £285,100 (2022 - £305,700) were paid in the year in respect of shares held by other related parties.
During the year, £191,039 (2022 - £157,993) was advanced in respect of other related parties loans and amounts of £290,000 (2022 - £234,000) were repaid in respect of other related parties loans. At the year end the total amounts due to be paid to other related parties by the company were £134,914 (2022 - £33,389) and amounts due to be paid by other related parties to the group were £264,394 (2022 - £261,830). During the year, interest of £nil (2022 - £5,119) was received by the group on amounts owed by other related parties.
HORTON COMMERCIALS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 32 -
29
Directors' transactions
Dividends totalling £nil (2022 - £1,000,000) were paid in the year in respect of shares held by the group's director. In addition, dividends totalling £62,250 (2022 - £30,000) were paid in the year via the director's loan account to another group shareholder and are included in the total dividends figure below.
Description
Opening balance
Amounts advanced
Amounts repaid
Dividends
Closing balance
£
£
£
£
£
Director's loan
436,161
1,907,200
(2,508,005)
(62,250)
(226,894)
436,161
1,907,200
(2,508,005)
(62,250)
(226,894)
30
Controlling party
The group is controlled by David Wolfenden who owns 75% of the called up share capital of Horton Commercials Limited.
31
Cash generated from group operations
2023
2022
£
£
Profit for the year after tax
2,556,131
2,996,040
Adjustments for:
Taxation charged
869,792
777,627
Finance costs
437,553
236,737
Investment income
(102)
(17,154)
Gain on disposal of tangible fixed assets
(1,673,363)
(955,596)
Amortisation and impairment of intangible assets
258,904
97,286
Depreciation and impairment of tangible fixed assets
3,435,698
3,347,393
Movements in working capital:
Increase in stocks
(3,426,333)
(883,933)
Decrease in debtors
200,397
1,802,567
Increase in creditors
2,920,836
866,889
Cash generated from operations
5,579,513
8,267,856
HORTON COMMERCIALS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 33 -
32
Cash generated from operations - company
2023
2022
£
£
Profit for the year after tax
2,610,096
3,033,514
Adjustments for:
Taxation charged
838,976
777,627
Finance costs
437,553
237,106
Investment income
(1,000,000)
(17,154)
Gain on disposal of tangible fixed assets
(1,668,095)
(955,596)
Amortisation and impairment of intangible assets
75,122
75,132
Depreciation and impairment of tangible fixed assets
3,428,364
3,347,256
Impairment of investments
1,000,000
-
Movements in working capital:
Increase in stocks
(2,713,785)
(752,166)
Decrease in debtors
303,631
207,379
Increase in creditors
2,113,426
2,493,088
Cash generated from operations
5,425,288
8,446,186
33
Analysis of changes in net debt - group
1 January 2023
Cash flows
31 December 2023
£
£
£
Cash at bank and in hand
284,434
514,867
799,301
Bank overdrafts
(330,360)
(890,396)
(1,220,756)
(45,926)
(375,529)
(421,455)
Borrowings excluding overdrafts
(1,754,575)
(212,691)
(1,967,266)
Obligations under finance leases
(6,616,966)
487,504
(6,129,462)
(8,417,467)
(100,716)
(8,518,183)
34
Analysis of changes in net debt - company
1 January 2023
Cash flows
31 December 2023
£
£
£
Cash at bank and in hand
121,332
484,749
606,081
Bank overdrafts
(330,360)
(890,396)
(1,220,756)
(209,028)
(405,647)
(614,675)
Borrowings excluding overdrafts
(1,754,575)
(212,691)
(1,967,266)
Obligations under finance leases
(6,616,966)
487,504
(6,129,462)
(8,580,569)
(130,834)
(8,711,403)
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