REGISTERED NUMBER: |
Strategic Report, |
Report of the Directors and |
Audited Financial Statements |
for the Year Ended 31 October 2023 |
for |
ZTL CONTRACTING LTD |
REGISTERED NUMBER: |
Strategic Report, |
Report of the Directors and |
Audited Financial Statements |
for the Year Ended 31 October 2023 |
for |
ZTL CONTRACTING LTD |
ZTL CONTRACTING LTD (REGISTERED NUMBER: 09834891) |
Contents of the Financial Statements |
for the Year Ended 31 October 2023 |
Page |
Company Information | 1 |
Strategic Report | 2 |
Report of the Directors | 4 |
Report of the Independent Auditors | 6 |
Profit and Loss Account | 10 |
Balance Sheet | 11 |
Statement of Changes in Equity | 12 |
Cash Flow Statement | 13 |
Notes to the Cash Flow Statement | 14 |
Notes to the Financial Statements | 16 |
ZTL CONTRACTING LTD |
Company Information |
for the Year Ended 31 October 2023 |
Directors: |
Registered office: |
Registered number: |
Senior statutory auditor: |
Auditors: |
Accountants and Statutory Auditor |
43 Coniscliffe Road |
Darlington |
Co. Durham |
DL3 7EH |
Accountants: |
Chartered Accountants |
3B Lockheed Court |
Preston Farm |
Stockton on Tees |
TS18 3SH |
ZTL CONTRACTING LTD (REGISTERED NUMBER: 09834891) |
Strategic Report |
for the Year Ended 31 October 2023 |
The directors present their strategic report for the year ended 31 October 2023. |
ZTL Contracting Ltd are a family-owned business specialising in Earthworks, Remediation and Ground Improvement in the construction, housing, energy, & logistics sectors. The company operates Nationally across the UK serviced by offices located in Teesside, Yorkshire and Derbyshire. |
The company's current portfolio of clients comprises of a diverse mixture of Tier 1 and Tier 2 commercial contractors, private developers, national housebuilders and local authorities. The steady and consistent flow of repeat business, assisted by a small number of targeted new clients, has helped support controlled, organic growth over the last eight years giving the business an ideal platform to strengthen the balance sheet, deliver stable profits and generate a sustainable cash reserve. |
Review of business |
The company strategic goals were produced for 2022 to 2025 with the expectation of difficult trading conditions post the COVID pandemic. However, company performance has generally exceeded these targets, with market demand being extremely strong. |
The board of directors are pleased to be able to demonstrate a year of significant growth which has exceeded our strategic target of achieving 10% increase in turnover against FY2021/22 accounts (£19.5m). Turnover surpassed £27.5m in the period which equates to a 41% growth on the preceding year. |
The growth in the period can be attributed to 3-key areas; new key relationships with Midlands based Tier 1 Contractors associated with the development of large-scale logistics warehousing, Private Developers and Local Authorities delivering capital works projects. These key areas of growth helped the company to a strategic goal in rebalancing the turnover split between Commercial, Private Developers and Capital Works Schemes. |
The pre-tax profitability of the company for 2022/23 was 15.2%. We credit this to the development of commercial strategies which are implemented from the outset of a new project and maintained throughout. ZTL are in the enviable position of not having a single month, throughout the year, post a loss. |
The business is mid-way through a strategy to take the company through to 2025. As part of the plan the opportunity for growth has been recognised, with revised turnover targets of 10% increase year-on-year being set. The strategy for achieving these targets relate to the opening of a new regional Midlands office with to allow for an increased geographical working area, and by increasing our turnover within capital works schemes. In addition, the company will continue to implement the long-term strategy of selective tendering with trusted clients, at sustainable margins. |
The company continues to invest heavily in 3-areas; plant, technology and training. The value of fixed assets is now in excess of £9-million, an increase of over £4-million in the period. It remains a strategic goal to invest in market-leading plant and equipment to ensure all works are carried out as safely and efficiently as possible, with our workforce's wellbeing the driving factor. The company has invested heavily in the latest IT hard and software for its staff, ensuring the business can continue to 'punch above its weight' in terms of competence and capability. This investment includes the production of tablet-based bespoke quality assurance document management app, which should provide the business with greater transparency in terms of quality control. Finally, ZTL have invested heavily in staff training with a clear emphasis on investing in youth. Given the well-publicised skill shortage in the construction industry, ZTL see education and training as an absolute necessity in terms of preparing the company for the future, whilst achieving one of our strategic targets of recruiting, retaining, and investing in the best people in the industry. |
The cash-position of the business continues to improve through operating profits, careful overhead cost control and prompt cash recovery. The company remains committed to paying its supply chain partners within terms. |
Future developments |
The board of directors look forward to FY2023/24 with cautious optimism. Continued high inflation coupled with the high cost of borrowing is affecting the construction sector along with the rest of the economy. However, the board of directors are optimistic that with ZTL's diverse revenue streams and careful commercial controls, the business is well placed to see out the challenging environment which is likely to last until the end of 2024. |
ZTL CONTRACTING LTD (REGISTERED NUMBER: 09834891) |
Strategic Report |
for the Year Ended 31 October 2023 |
Principal risks and uncertainties |
The principal activities of the company continue to be Earthworks, Remediation and Ground Improvement. |
The board of directors continue to plan for the possibility of potential recession and as such have formulated a 4-part strategy to best prepare the business. The strategy is as follows: |
1. Diversify revenue streams with the introduction of Local Authorities and capital works projects in lieu of |
speculative developers. |
2. Continue to carefully select clients and projects based on risk to the business. |
3. Target a sustainable margin within all successful tenders. |
4. Insure, where possible, all clients for the possibility of insolvency. Where this is not possible project bank accounts or advanced payment bonds are to be utilised. |
Whilst the board and senior management team remains consistent and stable, and the company has increased its headcount with the appointment of multiple management trainees and apprentices. These introductions are in keeping with the company's strategic target of investing in youth. Staff turnover continues to be very low, and the commitment of the workforce remains one of the most positive aspects of the business. |
Financial key performance indicators |
Client Satisfaction |
Client satisfaction is monitored to ensure our high standards are met and repeat business is secured. Regular dialogue is maintained at Director, middle management and site level. |
Profitability |
Cost and value are compared on a monthly, site-specific basis to inform monthly management accounts and long-term forecasts. Each project is reviewed monthly by the management team with the site team and exception reports are generated where required. |
Cashflow |
13-week rolling cashflow forecasts are updated and monitored daily. |
Health, Safety & Environmental |
Each site is independently audited on a rolling six-week basis. All reports are reviewed at board level each month. ZTL continue to invest heavily on the latest, most advanced health & safety plant and equipment with the aim of providing our skilled tradesman the safest tools to complete their roles. |
On behalf of the board: |
ZTL CONTRACTING LTD (REGISTERED NUMBER: 09834891) |
Report of the Directors |
for the Year Ended 31 October 2023 |
The directors present their report with the financial statements of the company for the year ended 31 October 2023. |
Principal activity |
The principal activity of the company in the year under review was that of an earthworks and ground improvement contractor. |
Dividends |
No dividends will be distributed for the year ended 31 October 2023. |
Directors |
The directors shown below have held office during the whole of the period from 1 November 2022 to the date of this report. |
Other changes in directors holding office are as follows: |
Statement of directors' responsibilities |
The directors are responsible for preparing the Strategic Report, the Report of the Directors 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), including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to: |
- | select suitable accounting policies and then apply them consistently; |
- | make judgements and accounting estimates that are reasonable and prudent; |
- | prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business. |
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. |
Statement as to disclosure of information to auditors |
So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and each director has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the company's auditors are aware of that information. |
ZTL CONTRACTING LTD (REGISTERED NUMBER: 09834891) |
Report of the Directors |
for the Year Ended 31 October 2023 |
Auditors |
The auditors, Mitchell Gordon LLP, will be proposed for re-appointment at the forthcoming Annual General Meeting. |
On behalf of the board: |
Report of the Independent Auditors to the Members of |
ZTL Contracting Ltd |
Opinion |
We have audited the financial statements of ZTL Contracting Ltd (the 'company') for the year ended 31 October 2023 which comprise the Profit and Loss Account, Balance Sheet, Statement of Changes in Equity, Cash Flow Statement and Notes to the Cash Flow Statement, Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice). |
In our opinion the financial statements: |
- | give a true and fair view of the state of the company's affairs as at 31 October 2023 and of its profit for the year then ended; |
- | have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and |
- | have been prepared in accordance with the requirements of the Companies Act 2006. |
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 Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. |
Conclusions relating to going concern |
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate. |
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue. |
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report. |
Other information |
The directors are responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon. |
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. |
In connection with our audit of the financial statements, 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 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 the audit: |
- | the information given in the Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
- | the Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements. |
Report of the Independent Auditors to the Members of |
ZTL Contracting Ltd |
Matters on which we are required to report by exception |
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Report of the Directors. |
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: |
- | adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or |
- | the financial statements are not in agreement with the accounting records and returns; or |
- | certain disclosures of 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 directors |
As explained more fully in the Statement of Directors' Responsibilities set out on page four, 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 necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. |
In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so. |
Report of the Independent Auditors to the Members of |
ZTL Contracting Ltd |
Auditors' 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 a Report of the Auditors that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. |
The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below: |
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: |
- | the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations; |
- | we identified the laws and regulations applicable to the company through discussions with directors and other management, and from our commercial knowledge and experience of the sectors in which the company operates; |
- | we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the company, including the Companies Act 2006, taxation legislation, data protection compliance, anti-bribery, employment, environmental and health and safety legislation; |
- | we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal correspondence; and |
- | identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit. |
These procedures did not identify any potentially material actual or suspected non-compliance. |
We assessed the susceptibility of the company's financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by: |
- | making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; and |
- | considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations. |
To address the risk of fraud through management bias and override of controls, we: |
- | performed analytical procedures to identify any unusual or unexpected relationships; |
- | reviewed material journal entries to identify unusual transactions or posting by unusual users; |
- | assessed whether judgements and assumptions made in determining the accounting estimates were indicative of potential bias; and |
- | investigated the rationale behind significant or unusual transactions. |
In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to: |
- | agreeing financial statement disclosures to underlying supporting documentation; |
- | reading the minutes of meetings of those charged with governance; |
- | enquiring of management as to actual and potential litigation and claims; and |
- | reviewing correspondence with HMRC and the company's legal advisors. |
Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it. |
In addition, as with any audit, there remains a higher risk of non-detection of fraud, as these may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls. Our audit procedures are designed to detect material misstatement. We are not responsible for preventing non-compliance of fraud and cannot be expected to detect non-compliance with all laws & regulations. |
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors. |
Report of the Independent Auditors to the Members of |
ZTL Contracting Ltd |
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 a Report of the Auditors 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. |
for and on behalf of |
Accountants and Statutory Auditor |
43 Coniscliffe Road |
Darlington |
Co. Durham |
DL3 7EH |
ZTL CONTRACTING LTD (REGISTERED NUMBER: 09834891) |
Profit and Loss Account |
for the Year Ended 31 October 2023 |
31/10/23 | 31/10/22 |
Notes | £ | £ |
Turnover | 3 |
Cost of sales |
Gross profit |
Administrative expenses |
Operating profit | 5 |
Interest receivable and similar income |
4,381,409 | 3,485,980 |
Interest payable and similar expenses | 6 |
Profit before taxation |
Tax on profit | 7 |
Profit for the financial year |
Other comprehensive income | - | - |
Total comprehensive income for the year |
ZTL CONTRACTING LTD (REGISTERED NUMBER: 09834891) |
Balance Sheet |
31 October 2023 |
31/10/23 | 31/10/22 |
Notes | £ | £ | £ | £ |
Fixed assets |
Tangible assets | 8 |
Current assets |
Stocks | 9 |
Debtors | 10 |
Cash at bank |
Creditors |
Amounts falling due within one year | 11 |
Net current assets |
Total assets less current liabilities |
Creditors |
Amounts falling due after more than one year |
12 |
( |
) |
( |
) |
Provisions for liabilities | 16 | ( |
) | ( |
) |
Net assets |
Capital and reserves |
Called up share capital | 17 |
Retained earnings | 18 |
Shareholders' funds |
The financial statements were approved by the Board of Directors and authorised for issue on |
ZTL CONTRACTING LTD (REGISTERED NUMBER: 09834891) |
Statement of Changes in Equity |
for the Year Ended 31 October 2023 |
Called up |
share | Retained | Total |
capital | earnings | equity |
£ | £ | £ |
Balance at 1 November 2021 |
Changes in equity |
Total comprehensive income | - |
Balance at 31 October 2022 |
Changes in equity |
Total comprehensive income | - |
Balance at 31 October 2023 |
ZTL CONTRACTING LTD (REGISTERED NUMBER: 09834891) |
Cash Flow Statement |
for the Year Ended 31 October 2023 |
31/10/23 | 31/10/22 |
Notes | £ | £ |
Cash flows from operating activities |
Cash generated from operations | 1 |
Interest paid | ( |
) | ( |
) |
Interest element of hire purchase payments paid |
( |
) |
( |
) |
Tax paid | ( |
) |
R&D taxation refund |
Net cash from operating activities |
Cash flows from investing activities |
Purchase of tangible fixed assets | ( |
) | ( |
) |
Sale of tangible fixed assets |
Interest received |
Net cash from investing activities | ( |
) |
Cash flows from financing activities |
Bank loan repayments in year | ( |
) | ( |
) |
Loans to associated companies | (485,373 | ) | (1,953,000 | ) |
Loans repayments received in year | - | 26,667 |
Capital repayments in year | ( |
) | ( |
) |
Net cash from financing activities | ( |
) | ( |
) |
Increase in cash and cash equivalents |
Cash and cash equivalents at beginning of year |
2 |
867,759 |
Cash and cash equivalents at end of year | 2 | 2,035,898 | 1,768,185 |
ZTL CONTRACTING LTD (REGISTERED NUMBER: 09834891) |
Notes to the Cash Flow Statement |
for the Year Ended 31 October 2023 |
1. | RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS |
31/10/23 | 31/10/22 |
£ | £ |
Profit before taxation |
Depreciation charges |
(Profit)/loss on disposal of fixed assets | ( |
) |
Finance costs | 182,487 | 63,294 |
Finance income | (49,848 | ) | (173 | ) |
5,379,376 | 4,121,604 |
Increase in stocks | ( |
) |
Increase in trade and other debtors | ( |
) | ( |
) |
Increase in trade and other creditors |
Cash generated from operations |
2. | CASH AND CASH EQUIVALENTS |
The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts: |
Year ended 31 October 2023 |
31/10/23 | 1/11/22 |
£ | £ |
Cash and cash equivalents | 2,035,898 | 1,768,185 |
Year ended 31 October 2022 |
31/10/22 | 1/11/21 |
£ | £ |
Cash and cash equivalents | 1,768,185 | 867,759 |
ZTL CONTRACTING LTD (REGISTERED NUMBER: 09834891) |
Notes to the Cash Flow Statement |
for the Year Ended 31 October 2023 |
3. | ANALYSIS OF CHANGES IN NET DEBT |
Other |
non-cash |
At 1/11/22 | Cash flow | changes | At 31/10/23 |
£ | £ | £ | £ |
Net cash |
Cash at bank |
and in hand | 1,768,185 | 267,713 | 2,035,898 |
1,768,185 | 2,035,898 |
Debt |
Finance leases | (2,842,476 | ) | 3,889,425 | - | (4,673,104 | ) |
Debts falling due |
within 1 year | (100,000 | ) | - | - | (100,000 | ) |
Debts falling due |
after 1 year | (266,667 | ) | 100,000 | - | (166,667 | ) |
(3,209,143 | ) | 3,989,425 | - | (4,939,771 | ) |
Total | (1,440,958 | ) | 4,257,138 | - | (2,903,873 | ) |
ZTL CONTRACTING LTD (REGISTERED NUMBER: 09834891) |
Notes to the Financial Statements |
for the Year Ended 31 October 2023 |
1. | STATUTORY INFORMATION |
ZTL Contracting Ltd is a |
The presentation currency of the financial statements is the Pound Sterling (£). |
2. | ACCOUNTING POLICIES |
Basis of preparing the financial statements |
Going concern |
At the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements. |
Turnover |
Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates. |
Revenue from contracts for the rendering of services is recognised by reference to the stage of completion of the contract. Applications for payment are issued throughout the duration of a contract based on work carried out and income is recognised at the date of application. Provision is made for any expected variations and losses on all contracts in the year in which they are foreseen. |
Tangible fixed assets |
Plant and machinery | - |
Fixtures and fittings | - |
Motor vehicles | - |
Computer equipment | - |
Stocks |
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. |
ZTL CONTRACTING LTD (REGISTERED NUMBER: 09834891) |
Notes to the Financial Statements - continued |
for the Year Ended 31 October 2023 |
2. | ACCOUNTING POLICIES - continued |
Financial instruments |
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. |
Basic financial liabilities, including loans from fellow group companies are initially recognised at transaction price unless the arrangement constitutes a financial 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 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 and 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. |
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. |
ZTL CONTRACTING LTD (REGISTERED NUMBER: 09834891) |
Notes to the Financial Statements - continued |
for the Year Ended 31 October 2023 |
2. | ACCOUNTING POLICIES - continued |
Taxation |
Taxation for the year comprises current and deferred tax. Tax is recognised in the Profit and Loss Account, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. |
Current or deferred taxation assets and liabilities are not discounted. |
Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date. |
Deferred tax |
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date. |
Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference. |
Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. |
Hire purchase and leasing commitments |
Assets obtained under hire purchase contracts or finance leases are capitalised in the balance sheet. Those held under hire purchase contracts are depreciated over their estimated useful lives. Those held under finance leases are depreciated over their estimated useful lives or the lease term, whichever is the shorter. |
The interest element of these obligations is charged to profit or loss on a straight line basis over the relevant period. The capital element of the future payments is treated as a liability. |
Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the lease. |
Pension costs and other post-retirement benefits |
The company operates a defined contribution pension scheme. Contributions payable to the company's pension scheme are charged to profit or loss in the period to which they relate. |
3. | TURNOVER |
All turnover arose within the UK from one principal activity as listed on page 4. |
4. | EMPLOYEES AND DIRECTORS |
31/10/23 | 31/10/22 |
£ | £ |
Wages and salaries |
Social security costs |
Other pension costs |
ZTL CONTRACTING LTD (REGISTERED NUMBER: 09834891) |
Notes to the Financial Statements - continued |
for the Year Ended 31 October 2023 |
4. | EMPLOYEES AND DIRECTORS - continued |
The average number of employees during the year was as follows: |
31/10/23 | 31/10/22 |
Office | 9 | 9 |
Site | 36 | 20 |
Directors | 2 | 2 |
31/10/23 | 31/10/22 |
£ | £ |
Directors' remuneration |
5. | OPERATING PROFIT |
The operating profit is stated after charging/(crediting): |
31/10/23 | 31/10/22 |
£ | £ |
Other operating leases |
Depreciation - owned assets |
Depreciation - assets on hire purchase contracts |
(Profit)/loss on disposal of fixed assets | ( |
) |
Auditors' remuneration |
6. | INTEREST PAYABLE AND SIMILAR EXPENSES |
31/10/23 | 31/10/22 |
£ | £ |
Bank interest |
Hire purchase |
7. | TAXATION |
Analysis of the tax charge |
The tax charge on the profit for the year was as follows: |
31/10/23 | 31/10/22 |
£ | £ |
Current tax: |
UK corporation tax | ( |
) |
Deferred tax |
Tax on profit |
UK corporation tax has been charged at 25% (2022 - 19%). |
ZTL CONTRACTING LTD (REGISTERED NUMBER: 09834891) |
Notes to the Financial Statements - continued |
for the Year Ended 31 October 2023 |
7. | TAXATION - continued |
Reconciliation of total tax charge included in profit and loss |
The tax assessed for the year is lower than the standard rate of corporation tax in the UK. The difference is explained below: |
31/10/23 | 31/10/22 |
£ | £ |
Profit before tax |
Profit multiplied by the standard rate of corporation tax in the UK of (2022 - |
Effects of: |
Expenses not deductible for tax purposes |
Utilisation of tax losses | ( |
) |
Adjustments to tax charge in respect of previous periods | ( |
) | ( |
) |
Super-deduction adjustments | (59,234 | ) | (83,551 | ) |
R&D tax relief in respect of prior year | (150,706 | ) | (134,069 | ) |
Adjustment re change in rate of deferred tax | - | 268,332 |
Deferred tax on timing differences | (27,456 | ) | - |
Total tax charge | 821,753 | 421,805 |
8. | TANGIBLE FIXED ASSETS |
Fixtures |
Plant and | and | Motor | Computer |
machinery | fittings | vehicles | equipment | Totals |
£ | £ | £ | £ | £ |
COST |
At 1 November 2022 |
Additions |
Disposals | ( |
) | ( |
) |
At 31 October 2023 |
DEPRECIATION |
At 1 November 2022 |
Charge for year |
Eliminated on disposal | ( |
) | ( |
) |
At 31 October 2023 |
NET BOOK VALUE |
At 31 October 2023 |
At 31 October 2022 |
ZTL CONTRACTING LTD (REGISTERED NUMBER: 09834891) |
Notes to the Financial Statements - continued |
for the Year Ended 31 October 2023 |
8. | TANGIBLE FIXED ASSETS - continued |
Fixed assets, included in the above, which are held under hire purchase contracts are as follows: |
Plant and | Motor |
machinery | vehicles | Totals |
£ | £ | £ |
COST |
At 1 November 2022 |
Additions |
Disposals | ( |
) | ( |
) |
Transfer to ownership | (262,950 | ) | (74,822 | ) | (337,772 | ) |
At 31 October 2023 |
DEPRECIATION |
At 1 November 2022 |
Charge for year |
Eliminated on disposal | ( |
) | ( |
) |
Transfer to ownership | (125,131 | ) | (46,218 | ) | (171,349 | ) |
At 31 October 2023 |
NET BOOK VALUE |
At 31 October 2023 |
At 31 October 2022 |
9. | STOCKS |
31/10/23 | 31/10/22 |
£ | £ |
Stocks |
10. | DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
31/10/23 | 31/10/22 |
£ | £ |
Trade debtors |
Amounts owed by associates |
Other debtors |
VAT |
Prepayments |
11. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
31/10/23 | 31/10/22 |
£ | £ |
Bank loans and overdrafts (see note 13) |
Hire purchase contracts (see note 14) |
Trade creditors |
Tax |
Social security and other taxes |
Other creditors |
Accrued expenses |
ZTL CONTRACTING LTD (REGISTERED NUMBER: 09834891) |
Notes to the Financial Statements - continued |
for the Year Ended 31 October 2023 |
12. | CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR |
31/10/23 | 31/10/22 |
£ | £ |
Bank loans (see note 13) |
Hire purchase contracts (see note 14) |
Interest is charged on bank loans at 1.82% per annum. Interest on hire purchase is charged at varying rates from 6% to 8%. |
13. | LOANS |
An analysis of the maturity of loans is given below: |
31/10/23 | 31/10/22 |
£ | £ |
Amounts falling due within one year or on demand: |
Bank loans |
Amounts falling due between one and two years: |
Bank loans - 1-2 years |
14. | LEASING AGREEMENTS |
Minimum lease payments fall due as follows: |
Hire purchase contracts |
31/10/23 | 31/10/22 |
£ | £ |
Net obligations repayable: |
Within one year |
Between one and five years |
Non-cancellable operating | leases |
31/10/23 | 31/10/22 |
£ | £ |
Within one year |
Between one and five years |
ZTL CONTRACTING LTD (REGISTERED NUMBER: 09834891) |
Notes to the Financial Statements - continued |
for the Year Ended 31 October 2023 |
15. | SECURED DEBTS |
The following secured debts are included within creditors: |
31/10/23 | 31/10/22 |
£ | £ |
Bank loans |
Hire purchase contracts | 4,673,104 | 2,842,476 |
The bank loan is secured by an unlimited debenture dated 4 June 2020 incorporating a fixed and floating charge over the assets of the company. |
Hire purchase debts are secured via the assets which they have financed. |
16. | PROVISIONS FOR LIABILITIES |
31/10/23 | 31/10/22 |
£ | £ |
Deferred tax | 2,112,310 | 1,118,046 |
Deferred |
tax |
£ |
Balance at 1 November 2022 |
Accelerated capital allowances | 1,101,430 |
Timing differences | (14,024 | ) |
Unused tax losses | (93,142 | ) |
Balance at 31 October 2023 |
The amount of the net reversal of deferred tax expected to occur next year is £231,246 relating to the reversal of existing timing differences on tangible fixed assets, unused tax losses and pension creditors. |
17. | CALLED UP SHARE CAPITAL |
Allotted, issued and fully paid: |
Number: | Class: | Nominal | 31/10/23 | 31/10/22 |
value: | £ | £ |
Ordinary | 1 | 100 | 100 |
Each share carries one vote and the right to participate in any distribution as recommended by the directors, on a pro-rata basis with regard to total number of shares in issue. |
18. | RESERVES |
Retained |
earnings |
£ |
At 1 November 2022 |
Profit for the year |
At 31 October 2023 |
ZTL CONTRACTING LTD (REGISTERED NUMBER: 09834891) |
Notes to the Financial Statements - continued |
for the Year Ended 31 October 2023 |
19. | RELATED PARTY DISCLOSURES |
31/10/23 | 31/10/22 |
£ | £ |
Sales |
Purchases |
Amount due from related party |
Amount due to related party |
During the year, the company incurred the above transactions with companies controlled by the directors. |
The comparatives have been restated to include turnover from applications and associated company loans which had previously been excluded. |
Key management personnel are considered to be the directors, they receive no remuneration through ZTL Contracting Ltd (2022: nil). |
20. | REALLOCATION OF COMPARATIVES |
The comparative amounts for depreciation on plant and machinery totalling £562,582 has been reallocated from administrative expenses to cost of sales, this has been done to appropriately reflect the nature of the transaction. |