Company registration number 01769896 (England and Wales)
PELICANS LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2022
PELICANS LIMITED
COMPANY INFORMATION
Director
Mrs S A Merchant
(Appointed 24 March 2024)
Company number
01769896
Registered office
Qualitas House
100 Elmgrove Road
Harrow
Middlesex
HA1 2RW
Auditor
RDP Newmans LLP
Lynwood House
373-375 Station Road
Harrow
Middlesex
HA1 2AW
Bankers
National Westminster Bank Plc
Hendon Central Circus Branch
5 Central Circus
Hendon
London
NW4 3LE
PELICANS LIMITED
CONTENTS
Page
Strategic report
1 - 2
Director's report
3
Director's responsibilities statement
4
Independent auditor's report
5 - 7
Profit and loss account
8
Group statement of comprehensive income
9
Group balance sheet
10
Company balance sheet
11
Group statement of changes in equity
12
Company statement of changes in equity
13
Group statement of cash flows
14
Company statement of cash flows
15
Notes to the financial statements
16 - 33
PELICANS LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MAY 2022
- 1 -

The director presents the strategic report for the year ended 31 May 2022.

Review of the business

The principal activity of the company is that of a holding company and it holds 100% of the shares in Pelicans Manufacturing Co. Limited and 14 Marshgate Lane Limited (incorporated on 11 January 2022).

 

The group's principal activities are the design, manufacture and sale of business promotional gifts. The director is disappointed with the results for the year but looks forward to improving upon them in future.

 

The turnover has reduced from £10.27 million to £9.11 million. The gross profit margin has decreased from 11.93% to 1.80%. This was largely due to the group moving to its new premises during the year, and that much of the stock held by the group for many years was no longer suitable for resale and was thus scrapped. Due to Brexit restrictions (several of the group's customers being based in Europe) this stock was not replenished. Despite the large write down in stock causing the gross margin deterioration, the group generated a pre tax profit of £4.46 million for the year compared to a loss of £165k in 2021, driven by profit generated from the disposal of freehold property

 

The group's liquidity at 31 May 2022 had a current ratio of 1.29 (2021: 2.12) and a quick ratio of 1.25 (2021: 1.78).

 

The director recognises the above Key Performance Indicators represents the current economic climate and is confident there are policies and procedures in place to ensure that the results in the forthcoming year are improved should the economic climate remain similar.

Principal risks and uncertainties

The director believes that the key business risks are in respect of competition from both UK and international businesses and in ensuring product quality and development and timely deliveries to its customers. In view of these risks and uncertainties the director regularly reviews the operations to mitigate the impact of such risks and uncertainties.

 

Future developments:

The director anticipates the business environment will remain challenging and competitive. She believes that the group is in a sound financial position and remains confident that the group will be able to reverse the decline in sales revenue in future.

 

Research and development

The group is continually undertaking research and development to improve its product range.

 

Treasury operations and financial instruments

The group operates a centralised treasury function which is responsible for managing the liquidity, interest and foreign currency risks associated with the group’s activities.

 

Liquidity risk

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

 

Interest rate risk

The group is exposed to interest rate risk on bank overdrafts and loans. The group uses interest rate derivatives to manage the mix of fixed and variable rate debts so as to reduce its exposure to changes in its interest rates.

 

Foreign currency risk

The group’s principal foreign currency exposures arise from trading with overseas companies. Group policy permits but does not demand that these exposures may be hedged in order to fix the cost in sterling. This hedging activity involves the use of foreign exchange forward contracts.

PELICANS LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2022
- 2 -

Credit risk

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

Other information and explanations

The group does not follow any specified code or standard on payment practice. However, it is the group's policy to negotiate the terms with its suppliers and to ensure that they are aware of the terms of payment when business is agreed. It is the group's policy to abide by these terms.

On behalf of the board

Mrs S A Merchant
Director
31 July 2024
PELICANS LIMITED
DIRECTOR'S REPORT
FOR THE YEAR ENDED 31 MAY 2022
- 3 -

The director presents her annual report and financial statements for the year ended 31 May 2022.

Principal activities

The principal activity of the group continued to be that of design, manufacturing and sale of business promotional gifts.

Results and dividends

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

Ordinary share dividends were paid amounting to £3,375,000 (2021: £nil). The director does not recommend payment of a final dividend.

Director

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

A. N. Merchant
(Resigned 24 January 2024)
S. F. Maxton
(Resigned 31 January 2024)
Mrs S A Merchant
(Resigned 9 October 2023)
Mrs S A Merchant
(Appointed 24 March 2024)
Mr P Kabra
(Appointed 12 January 2024 and resigned 25 March 2024)
Auditor

RDP Newmans LLP were appointed as auditor to the company on 1 November 2021 and were deemed to be re-appointed in accordance with section 487(2) of the Companies Act 2006.

Strategic report

The truegroup has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the group's strategic report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the directors' report.

Statement of disclosure to auditor

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

Medium-sized companies exemption

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

On behalf of the board
Mrs S A Merchant
Director
31 July 2024
PELICANS LIMITED
DIRECTOR'S RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 MAY 2022
- 4 -

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

 

Company law requires the director to prepare financial statements for each financial year. Under that law the director has elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the director must not approve the financial statements unless she is 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 director is required to:

 

 

The director is 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. She is 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.

PELICANS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF PELICANS LIMITED
- 5 -
Opinion

We have audited the financial statements of Pelicans Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 May 2022 which comprise the group profit and loss account, the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows, the company statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

Basis for opinion

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

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the director's 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 director with respect to going concern are described in the relevant sections of this report.

Other information

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

 

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

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

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

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

 

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

Responsibilities of director

As explained more fully in the director's responsibilities statement, the director is responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the director determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the director is responsible for assessing the 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 director either intends to liquidate the parent company or to cease operations, or has no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

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

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

The extent to which the audit was considered capable of detecting irregularities including fraud

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:

We assessed the susceptibility of the group’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:

PELICANS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF PELICANS LIMITED
- 7 -

To address the risk of fraud through management bias and override of controls, we:

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:

No instances of material non-compliance were identified. However, the likelihood of detecting irregularities, including fraud, is limited by the inherent difficulty in detecting irregularities, the effectiveness of the entity’s controls, and the nature, timing and extent of the audit procedures performed. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance.

Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.

Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.

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

Use of our report

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

Paresh Radia FCA (Senior Statutory Auditor)
For and on behalf of RDP Newmans LLP
1 August 2024
Chartered Accountants
Statutory Auditor
Lynwood House
373-375 Station Road
Harrow
Middlesex
HA1 2AW
PELICANS LIMITED
GROUP PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 MAY 2022
- 8 -
2022
2021
Notes
£
£
Turnover
3
9,114,627
10,273,111
Cost of sales
(8,950,263)
(9,047,455)
Gross profit
164,364
1,225,656
Administrative expenses
(4,290,955)
(1,609,482)
Other income
4
8,615,795
276,720
Operating profit/(loss)
5
4,489,204
(107,106)
Interest receivable and similar income
8
14,773
73,746
Interest payable and similar expenses
9
(42,702)
(131,754)
Profit/(loss) before taxation
4,461,275
(165,114)
Tax on profit/(loss)
10
(619,778)
(5,044)
Profit/(loss) for the financial year
27
3,841,497
(170,158)
Profit/(loss) for the financial year is all attributable to the owners of the parent company.

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

PELICANS LIMITED
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MAY 2022
- 9 -
2022
2021
£
£
Profit/(loss) for the year
3,841,497
(170,158)
Other comprehensive income
Tax relating to other comprehensive income
-
0
17,170
Total comprehensive income for the year
3,841,497
(152,988)
Total comprehensive income for the year is all attributable to the owners of the parent company.
PELICANS LIMITED
GROUP BALANCE SHEET
AS AT 31 MAY 2022
31 May 2022
- 10 -
2022
2021
Notes
£
£
£
£
Fixed assets
Tangible assets
12
298,854
7,151,350
Investments
13
-
0
125,000
298,854
7,276,350
Current assets
Stocks
15
166,021
818,830
Debtors
16
6,339,600
3,973,557
Investments
17
-
0
685
Cash at bank and in hand
181,926
393,252
6,687,547
5,186,324
Creditors: amounts falling due within one year
18
(5,199,536)
(2,450,894)
Net current assets
1,488,011
2,735,430
Total assets less current liabilities
1,786,865
10,011,780
Creditors: amounts falling due after more than one year
19
-
(3,584,940)
Provisions for liabilities
Deferred tax liability
22
35,213
776,592
(35,213)
(776,592)
Net assets
1,751,652
5,650,248
Capital and reserves
Called up share capital
24
60,000
60,000
Revaluation reserve
25
-
0
4,365,092
Capital redemption reserve
26
100,000
100,000
Profit and loss reserves
27
1,591,652
1,125,156
Total equity
1,751,652
5,650,248

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

The financial statements were approved by the board of directors and authorised for issue on 31 July 2024 and are signed on its behalf by:
31 July 2024
Mrs S A Merchant
Director
Company registration number 01769896 (England and Wales)
PELICANS LIMITED
COMPANY BALANCE SHEET
AS AT 31 MAY 2022
31 May 2022
- 11 -
2022
2021
Notes
£
£
£
£
Fixed assets
Investments
13
117,001
117,000
Current assets
Debtors
16
1,858,223
475,839
Cash at bank and in hand
387
420
1,858,610
476,259
Creditors: amounts falling due within one year
18
(1,882,939)
(497,542)
Net current liabilities
(24,329)
(21,283)
Net assets
92,672
95,717
Capital and reserves
Called up share capital
24
60,000
60,000
Profit and loss reserves
27
32,672
35,717
Total equity
92,672
95,717

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 £3,371,955 (2021 - £3,046 loss).

These financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime.

The financial statements were approved by the board of directors and authorised for issue on 31 July 2024 and are signed on its behalf by:
31 July 2024
Mrs S A Merchant
Director
Company registration number 01769896 (England and Wales)
PELICANS LIMITED
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MAY 2022
- 12 -
Share capital
Revaluation reserve
Capital redemption reserve
Profit and loss reserves
Total
Notes
£
£
£
£
£
Balance at 1 June 2020
60,000
4,347,922
100,000
1,295,314
5,803,236
Year ended 31 May 2021:
Loss for the year
-
-
-
(170,158)
(170,158)
Other comprehensive income:
Tax relating to other comprehensive income
-
17,170
-
-
0
17,170
Total comprehensive income
-
17,170
-
(170,158)
(152,988)
Balance at 31 May 2021
60,000
4,365,092
100,000
1,125,156
5,650,248
Year ended 31 May 2022:
Profit and total comprehensive income
-
-
-
3,841,497
3,841,497
Dividends
11
-
-
-
(3,375,000)
(3,375,000)
Other movements
-
(4,365,092)
-
-
(4,365,092)
Balance at 31 May 2022
60,000
-
0
100,000
1,591,652
1,751,652
PELICANS LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MAY 2022
- 13 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 June 2020
60,000
38,763
98,763
Year ended 31 May 2021:
Loss and total comprehensive income for the year
-
(3,046)
(3,046)
Balance at 31 May 2021
60,000
35,717
95,717
Year ended 31 May 2022:
Profit and total comprehensive income
-
3,371,955
3,371,955
Dividends
11
-
(3,375,000)
(3,375,000)
Balance at 31 May 2022
60,000
32,672
92,672
PELICANS LIMITED
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MAY 2022
- 14 -
2022
2021
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from/(absorbed by) operations
31
3,143,373
(525,469)
Interest paid
(42,702)
(131,754)
Income taxes paid
(747,887)
-
0
Net cash inflow/(outflow) from operating activities
2,352,784
(657,223)
Investing activities
Purchase of tangible fixed assets
(114,611)
(60,789)
Proceeds from disposal of tangible fixed assets
6,776,923
48,000
Proceeds from disposal of investments
125,685
-
Repayment of loans
(1,671,282)
(149,386)
Interest received
14,773
73,746
Net cash generated from/(used in) investing activities
5,131,488
(88,429)
Financing activities
(Repayment)/receipt of bank loans
(3,937,907)
362,469
(Payment)/refund of finance leases obligations
(12,792)
7,619
Dividends paid to equity shareholders
(3,375,000)
-
0
Net cash (used in)/generated from financing activities
(7,325,699)
370,088
Net increase/(decrease) in cash and cash equivalents
158,573
(375,564)
Cash and cash equivalents at beginning of year
(386,031)
(10,467)
Cash and cash equivalents at end of year
(227,458)
(386,031)
Relating to:
Cash at bank and in hand
181,926
393,252
Bank overdrafts included in creditors payable within one year
(409,384)
(779,283)
PELICANS LIMITED
COMPANY STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MAY 2022
- 15 -
2022
2021
Notes
£
£
£
£
Cash flows from operating activities
Cash absorbed by operations
32
(32)
(31)
Investing activities
Purchase of investment in subsidiaries
(1)
(2)
Dividends received
3,375,000
-
0
Net cash generated from/(used in) investing activities
3,374,999
(2)
Financing activities
Dividends paid to equity shareholders
(3,375,000)
-
Net cash used in financing activities
(3,375,000)
-
Net decrease in cash and cash equivalents
(33)
(33)
Cash and cash equivalents at beginning of year
420
453
Cash and cash equivalents at end of year
387
420
PELICANS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2022
- 16 -
1
Accounting policies
Company information

Pelicans Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is Qualitas House, 100 Elmgrove Road, Harrow, HA1 2RW.

 

The group consists of Pelicans Limited and all of its subsidiaries.

1.1
Accounting convention

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

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

The financial statements have been prepared under the historical cost convention, modified to include the revaluation of freehold properties and to include investment properties and certain financial instruments at fair value. The principal accounting policies adopted are set out below.

1.2
Business combinations

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

 

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

1.3
Basis of consolidation

The consolidated financial statements incorporate those of Pelicans Limited and all of its subsidiaries (ie entities that the group controls through its power to govern the financial and operating policies so as to obtain economic benefits).

 

All financial statements are made up to 31 May 2022. 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.

1.4
Going concern

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

PELICANS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2022
1
Accounting policies
(Continued)
- 17 -
1.5
Turnover

Turnover is recognised at the fair value of the consideration received or receivable for goods provided in the normal course of business, and is shown net of VAT. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

1.6
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:

Freehold buildings
2% straight line
Leasehold land and buildings
10 year straight line
Plant and machinery
12.5% reducing balance
Fixtures, fittings and equipment
20% - 25% reducing balance
Motor vehicles
25% reducing balance

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

1.7
Fixed asset investments

Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available.

 

In the parent company financial statements, investments in subsidiaries are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.

A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

1.8
Impairment of fixed assets

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

 

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.

PELICANS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2022
1
Accounting policies
(Continued)
- 18 -

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.

1.9
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.

1.10
Cash and cash equivalents

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

1.11
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.

PELICANS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2022
1
Accounting policies
(Continued)
- 19 -
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.

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

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.

PELICANS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2022
1
Accounting policies
(Continued)
- 20 -
Derecognition of financial liabilities

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

1.12
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.

1.13
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.

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.

1.14
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.

1.15
Retirement benefits

Pension contributions are paid to an outside scheme and payments are charged to the profit and loss accounts as incurred.

PELICANS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2022
1
Accounting policies
(Continued)
- 21 -
1.16
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.

1.17
Foreign exchange

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

2
Judgements and key sources of estimation uncertainty

In the application of the group’s accounting policies, the director is required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

 

The 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 the director's view, there are no significant judgements or estimates made.

3
Turnover and other revenue

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

2022
2021
£
£
Turnover analysed by class of business
Promotional goods
9,114,627
10,273,111
2022
2021
£
£
Turnover analysed by geographical market
Europe
7,202,206
7,751,144
United Kingdom
1,912,421
2,026,345
Rest of the world
-
495,622
9,114,627
10,273,111
PELICANS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2022
3
Turnover and other revenue
(Continued)
- 22 -
2022
2021
£
£
Other revenue
Interest income
14,773
73,746
4
Other income
2022
2021
£
£
Exchange gain/(loss)
(72,666)
(15,183)
Grants received
88,145
291,903
Profit on disposal of property
8,600,316
-
8,615,795
276,720
5
Operating profit/(loss)
2022
2021
£
£
Operating profit/(loss) for the year is stated after charging/(crediting):
Exchange losses
72,666
15,183
Depreciation of owned tangible fixed assets
55,569
159,339
Depreciation of tangible fixed assets held under finance leases
8,930
10,642
Loss/(profit) on disposal of tangible fixed assets
125,685
(9,147)
6
Auditor's remuneration
2022
2021
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the group and company
3,000
3,000
Audit of the financial statements of the company's subsidiaries
25,000
25,000
28,000
28,000
For other services
All other non-audit services
20,000
20,000
PELICANS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2022
- 23 -
7
Employees

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

Group
Company
2022
2021
2022
2021
Number
Number
Number
Number
Selling and distribution
1
1
-
-
Administration
12
8
-
-
Production
27
34
-
-
Total
40
43
-
0
-
0

Their aggregate remuneration comprised:

Group
Company
2022
2021
2022
2021
£
£
£
£
Wages and salaries
1,580,709
1,519,040
-
0
-
0
Pension costs
26,885
33,222
-
0
-
0
1,607,594
1,552,262
-
0
-
0

The total compensation paid to Key Management Personnel during the year amounted to £457,795 (2021: £425,780).

8
Interest receivable and similar income
2022
2021
£
£
Interest income
Other interest income
14,773
73,746
9
Interest payable and similar expenses
2022
2021
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
40,185
128,263
Other finance costs:
Interest on finance leases and hire purchase contracts
1,721
3,491
Other interest
796
-
Total finance costs
42,702
131,754
PELICANS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2022
- 24 -
10
Taxation
2022
2021
£
£
Current tax
UK corporation tax on profits for the current period
613,270
-
0
Deferred tax
Origination and reversal of timing differences
6,508
5,044
Total tax charge
619,778
5,044

The actual charge for the year can be reconciled to the expected charge/(credit) for the year based on the profit or loss and the standard rate of tax as follows:

2022
2021
£
£
Profit/(loss) before taxation
4,461,275
(165,114)
Expected tax charge/(credit) based on the standard rate of corporation tax in the UK of 19.00% (2021: 19.00%)
847,642
(31,372)
Tax effect of expenses that are not deductible in determining taxable profit
19,936
3,412
Tax effect of utilisation of tax losses not previously recognised
(171,000)
-
0
Unutilised tax losses carried forward
35,624
788
Group relief
-
0
579
Depreciation on assets not qualifying for tax allowances
11,724
19,190
Deferred tax movement
6,508
5,044
Capital allowances
(62,269)
7,403
Indexation allowance
(68,387)
-
0
Taxation charge
619,778
5,044

In addition to the amount charged to the profit and loss account, the following amounts relating to tax have been recognised directly in other comprehensive income:

2022
2021
£
£
Deferred tax arising on:
Revaluation of property
-
(17,170)
11
Dividends
2022
2021
Recognised as distributions to equity holders:
£
£
Interim paid
3,375,000
-
PELICANS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2022
- 25 -
12
Tangible fixed assets
Group
Freehold buildings
Leasehold land and buildings
Plant and machinery
Fixtures, fittings and equipment
Motor vehicles
Total
£
£
£
£
£
£
Cost or valuation
At 1 June 2021
7,250,000
-
0
1,023,694
444,146
86,627
8,804,467
Additions
-
0
27,919
9,415
-
0
77,277
114,611
Disposals
(7,250,000)
-
0
-
0
(424,100)
-
0
(7,674,100)
At 31 May 2022
-
0
27,919
1,033,109
20,046
163,904
1,244,978
Depreciation and impairment
At 1 June 2021
404,000
-
0
830,790
384,863
33,464
1,653,117
Depreciation charged in the year
-
0
2,792
28,561
536
32,610
64,499
Eliminated in respect of disposals
(404,000)
-
0
-
0
(367,492)
-
0
(771,492)
At 31 May 2022
-
0
2,792
859,351
17,907
66,074
946,124
Carrying amount
At 31 May 2022
-
0
25,127
173,758
2,139
97,830
298,854
At 31 May 2021
6,846,000
-
0
192,904
59,283
53,163
7,151,350
The company had no tangible fixed assets at 31 May 2022 or 31 May 2021.

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
2022
2021
2022
2021
£
£
£
£
Motor vehicles
26,789
45,722
-
0
-
0

The freehold property is stated at valuation less accumulated depreciation. The value of land not depreciated is estimated at £0 (2021: £2,200,000).

The revaluation surplus is disclosed in note 25.

The freehold property is carried at valuation. If the assets were measured using the cost model, the carrying amounts would be as follows:

PELICANS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2022
12
Tangible fixed assets
(Continued)
- 26 -
2022
2021
£
£
Group
Cost
-
2,263,704
Accumulated depreciation
-
227,009
Carrying value
-
2,490,713
13
Fixed asset investments
Group
Company
2022
2021
2022
2021
Notes
£
£
£
£
Investments in subsidiaries
14
-
0
-
0
117,001
117,000
Unlisted investments
-
0
125,000
-
0
-
0
-
0
125,000
117,001
117,000
Movements in fixed asset investments
Group
Investments
£
Cost or valuation
At 1 June 2021 and 31 May 2022
125,000
Impairment
At 1 June 2021
-
Disposals
125,000
At 31 May 2022
125,000
Carrying amount
At 31 May 2022
-
At 31 May 2021
125,000
PELICANS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2022
13
Fixed asset investments
(Continued)
- 27 -
Movements in fixed asset investments
Company
Shares in subsidiaries
£
Cost or valuation
At 1 June 2021
117,000
Additions
1
At 31 May 2022
117,001
Carrying amount
At 31 May 2022
117,001
At 31 May 2021
117,000
14
Subsidiaries

Details of the company's subsidiaries at 31 May 2022 are as follows:

Name of undertaking
Registered office
Nature of business
Class of
% Held
shares held
Direct
Pelicans Manufacturing Co. Ltd
Qualitas House, 100 Elmgrove Road, Harrow HA1 2RW
Design. manufacture and sale of promotional gifts
Ordinary shares
100.00
14 Marshgate Lane Limited
14 Bedford Square, London WC1B 3JA
Property development
Ordinary shares
100.00
The aggregate capital and reserves and the result for the year of the subsidiaries noted above was as follows:
Name of undertaking
Capital and Reserves
Profit/(Loss)
£
£
Pelicans Manufacturing Co. Ltd
1,960,428
4,028,990
14 Marshgate Lane Limited
(149,612)
(149,613)
15
Stocks
Group
Company
2022
2021
2022
2021
£
£
£
£
Finished goods and goods for resale
166,021
818,830
-
0
-
0
PELICANS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2022
- 28 -
16
Debtors
Group
Company
2022
2021
2022
2021
Amounts falling due within one year:
£
£
£
£
Trade debtors
2,252,613
2,014,628
-
0
-
0
Corporation tax recoverable
294,161
1,900
-
0
-
0
Amounts owed by group undertakings
-
475,839
1,858,223
475,839
Other debtors
3,732,018
1,420,665
-
0
-
0
Prepayments and accrued income
60,808
60,525
-
0
-
0
6,339,600
3,973,557
1,858,223
475,839
17
Current asset investments
Group
Company
2022
2021
2022
2021
£
£
£
£
Listed investments
-
685
-
-

The listed investments comprise shares listed on the London Stock Exchange.

18
Creditors: amounts falling due within one year
Group
Company
2022
2021
2022
2021
Notes
£
£
£
£
Bank loans and overdrafts
20
409,384
1,132,250
-
0
-
0
Obligations under finance leases
21
28,673
41,465
-
0
-
0
Trade creditors
315,417
65,207
-
0
-
0
Amounts owed to group undertakings
1,875,411
-
0
1,875,411
490,527
Corporation tax payable
905,531
-
0
-
0
-
0
Other taxation and social security
39,991
89,823
-
-
Other creditors
1,533,776
987,997
-
0
-
0
Accruals and deferred income
91,353
134,152
7,528
7,015
5,199,536
2,450,894
1,882,939
497,542
19
Creditors: amounts falling due after more than one year
Group
Company
2022
2021
2022
2021
Notes
£
£
£
£
Bank loans and overdrafts
20
-
0
3,584,940
-
0
-
0
PELICANS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2022
- 29 -
20
Loans and overdrafts
Group
Company
2022
2021
2022
2021
£
£
£
£
Bank loans
-
0
3,937,907
-
0
-
0
Bank overdrafts
409,384
779,283
-
0
-
0
409,384
4,717,190
-
-
Payable within one year
409,384
1,132,250
-
0
-
0
Payable after one year
-
0
3,584,940
-
0
-
0

The bank loans and overdrafts are secured by a fixed and floating charge over the assets of the group and the company.

21
Finance lease obligations
Group
Company
2022
2021
2022
2021
£
£
£
£
Future minimum lease payments due under finance leases:
Within one year
14,069
14,069
-
0
-
0
In two to five years
14,604
27,396
-
0
-
0
28,673
41,465
-
-

Finance lease payments represent rentals payable by the company or group for certain items of plant and machinery. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is 3 years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.

 

The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts £26,789 (2021: £41,465). The depreciation charge in respect of such assets amounted to £8,930 (2021: £10,642).

22
Deferred taxation

Deferred tax assets and liabilities are offset where the group or company has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:

Liabilities
Liabilities
2022
2021
Group
£
£
Accelerated capital allowances
35,213
28,705
Revaluations
-
747,887
35,213
776,592
PELICANS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2022
22
Deferred taxation
(Continued)
- 30 -
The company has no deferred tax assets or liabilities.
Group
Company
2022
2022
Movements in the year:
£
£
Liability at 1 June 2021
776,592
-
Charge to profit or loss
6,508
-
Transfer on disposal
(747,887)
-
Liability at 31 May 2022
35,213
-

The deferred tax liability set out above in respect of capital allowances is excepted to reverse within 12 months.

23
Retirement benefit schemes
2022
2021
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
26,885
33,222

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. Contributions of £2,549 (2021: £8,713) were outstanding as at the balance sheet date.

24
Share capital
Group and company
2022
2021
2022
2021
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
60,000
60,000
60,000
60,000
25
Revaluation reserve
Group
Company
2022
2021
2022
2021
£
£
£
£
At the beginning of the year
4,365,092
4,347,922
-
0
-
0
Deferred tax on revaluation of tangible assets
-
17,170
-
-
Other movements
(4,365,092)
-
-
-
At the end of the year
-
0
4,365,092
-
0
-
PELICANS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2022
- 31 -
26
Capital redemption reserve
Group
Company
2022
2021
2022
2021
£
£
£
£
At the beginning and end of the year
100,000
100,000
-
0
-
0
27
Profit and loss reserves
Group
Company
2022
2021
2022
2021
£
£
£
£
At the beginning of the year
1,125,156
1,295,314
35,717
38,763
Profit/(loss) for the year
3,841,496
(170,158)
3,371,955
(3,046)
Dividends
(3,375,000)
-
(3,375,000)
-
At the end of the year
1,591,652
1,125,156
32,672
35,717
28
Related party transactions

The company has taken advantage of the exemption available in accordance with FRS 102 para 33.1A not to disclose transactions entered into between two or more members of a group, as the company is a wholly owned subsidiary undertaking of the group.

 

Included within amounts owed to group undertakings is a balance of £1,875,411 (2021: £475,839 due from) due to Al-Noor Investments Limited (a company incorporated in Jersey), who is the parent undertaking.

 

During the year the group purchased goods worth £6,520,330 (2021: £6,843,821) from Pelicans Automotive & Promotional Products (Pvt.) Limited, a company registered in India, and related by virtue of common control. These transactions were carried out at arms length and on normal commercial terms. At the year end a balance £1,533,776 (2021: £987,997) was due to Pelicans Automotive & Promotional Products (Pvt.) Limited.

 

Included within other debtors are amounts of £2,255,740 (2021: £nil) due from companies, in which Mr A N Merchant is a common director.

 

During the year, amounts of £1,379,895 (2021: £nil) and £456,809 (2021: £nil) due from The Collective Holdco Jersey Limited (a company incorporated in Jersey) and 14 Bedford Square Ltd respectively, were deemed irrecoverable and written off. Mr R M Merchant, the son of Mr A N Merchant, is a director and beneficial owner in these companies.

 

During the year an amount of £20,737 (2021: £nil) due from a director of Pelicans Manufacturing Co. Ltd was written off.

 

Included within other debtors are balances of £1,820,688 (2021: £149,386) due from the directors. Interest of £14,773 (2021: £nil) has been charged on these balances.

PELICANS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2022
- 32 -
29
Operating lease commitments

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
2022
2021
2022
2021
£
£
£
£
Within one year
218,609
-
-
-
Between two and five years
1,165,912
-
-
-
In over five years
1,457,390
-
-
-
2,841,911
-
-
-
30
Controlling party

By virtue of it's majority shareholding, the ultimate parent company is Al-Noor Investments Limited, a company registered in Jersey, Channel Islands. Al-Noor Investments Limited is not required to prepare consolidated financial statements.

31
Cash generated from/(absorbed by) group operations
2022
2021
£
£
Profit/(loss) for the year after tax
3,841,497
(170,158)
Adjustments for:
Taxation charged
619,778
5,044
Finance costs
42,702
131,754
Investment income
(14,773)
(73,746)
Loss/(gain) on disposal of tangible fixed assets
125,685
(9,147)
Depreciation and impairment of tangible fixed assets
64,499
169,981
Decrease in provisions
(4,365,092)
-
Movements in working capital:
Decrease in stocks
652,808
178,805
Increase in debtors
(402,500)
(409,952)
Increase/(decrease) in creditors
2,578,769
(348,050)
Cash generated from/(absorbed by) operations
3,143,373
(525,469)
PELICANS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2022
- 33 -
32
Cash absorbed by operations - company
2022
2021
£
£
Profit/(loss) for the year after tax
3,371,955
(3,046)
Adjustments for:
Investment income
(3,375,000)
-
0
Movements in working capital:
Increase in debtors
(1,382,384)
(145,122)
Increase in creditors
1,385,397
148,137
Cash absorbed by operations
(32)
(31)
33
Analysis of changes in net debt - group
1 June 2021
Cash flows
31 May 2022
£
£
£
Cash at bank and in hand
393,252
(211,326)
181,926
Bank overdrafts
(779,283)
369,899
(409,384)
(386,031)
158,573
(227,458)
Borrowings excluding overdrafts
(3,937,907)
3,937,907
-
Obligations under finance leases
(41,465)
12,792
(28,673)
(4,365,403)
4,109,272
(256,131)
34
Analysis of changes in net funds - company
1 June 2021
Cash flows
31 May 2022
£
£
£
Cash at bank and in hand
420
(33)
387
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