Company registration number 12091959 (England and Wales)
AUDEMARS PIGUET (SLOANE STREET) UK LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
AUDEMARS PIGUET (SLOANE STREET) UK LIMITED
COMPANY INFORMATION
Directors
D.Compton
V. Fante
M. Vigano
Company number
12091959
Registered office
82-84 Grosvenor Street
1st Floor
London
W1K 3JZ
Auditor
Ad Valorem Audit Services Limited
Chartered Certified Accountants & Statutory Auditors
2 Manor Farm Court
Old Wolverton Road
Old Wolverton
Milton Keynes
Buckinghamshire
MK12 5NN
Business address
82-84 Grosvenor Street
1st Floor
London
W1K 3JZ
AUDEMARS PIGUET (SLOANE STREET) UK LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2 - 3
Directors' responsibilities statement
4
Independent auditor's report
5 - 8
Income statement
9
Statement of financial position
10
Statement of changes in equity
11
Statement of cash flows
12
Notes to the financial statements
13 - 26
AUDEMARS PIGUET (SLOANE STREET) UK LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -
The directors present the strategic report for the year ended 31 December 2023.
Review of the business
The results for the year and financial position of the company are as shown in the annexed financial statements.
The annexed financial statements show that the company made a profit before tax for the year ended 31 December 2023 of £3,485,647 (2022: £2,786,672) and had accumulated retained earnings of £2,643,727 (2022: £2,380,000).
Operating profit was £3,486,634 (2022: £2,843,767).
The company acts as a retailer only.
Principal risks and uncertainties
Company activity is wholly in the retail of luxury goods. Almost by definition the market for luxury goods is very international. The UK market is therefore exposed to movements between most of the major world currencies. Furthermore, a proportion of UK sales are to international business travellers and tourists. The internet creates the opportunity for seasoned travellers to compare prices on a global scale. Of course this uncertainty is common to all companies who operate in this high end market. On balance, the company considers this to be a low risk as London continues to enjoy the status of a global tourist destination.
Cycling out of 2022 restrained inventory, 2023 was another strong year for Sloane Street as we strengthened our sales approach to focus on the local market.
The directors are pleased with the results presented by these financial statements for 2023.
Key performance indicators
Gross Profit Percentage:
2023: 33.6%
2022: 33.8%
Transfer pricing policy was set with group during the current period and is reviewed on an on-going basis.
Other performance indicators
Employees Cost:
2023: £384,540
2022: £451,782
D.Compton
Director
12 July 2024
AUDEMARS PIGUET (SLOANE STREET) UK LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
The directors present their annual report and financial statements for the year ended 31 December 2023.
Principal activities
The principal activity of the company is that of retail of watches.
Results and dividends
The results for the year are set out on page 9.
Ordinary dividends were paid amounting to £2,380,000. The directors do not recommend payment of a final dividend.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
D.Compton
V. Fante
M. Vigano
Supplier payment policy
The company's current policy concerning the payment of trade creditors is to:
settle the terms of payment with suppliers when agreeing the terms of each transaction;
ensure that suppliers are made aware of the terms of payment by inclusion of the relevant terms in contracts; and
pay in accordance with the company's contractual and other legal obligations.
Trade creditors of the company at the year end were equivalent to 1 day's (2022: 1 day's) purchases, based on the average daily amount invoiced by suppliers during the year.
Financial instruments
The company uses various financial instruments including cash, trade receivables and payables that arise directly from its operations. The existence of these financial instruments exposes the company to a number of financial risks, of which the more significant risk is liquidity risk. The directors review and agree policies for managing these risks and they are summarised below:
Liquidity risk
The Company manages its cash and borrowing requirements in order to maximise interest income and minimise interest expense, whilst ensuring the company has sufficient liquid resources to meet the operating needs of the business.
Research and development
In order to ensure the future competitiveness of the group and its subsidiaries, our parent company continues to research innovative and new models to bring to the market.
Post reporting date events
There have been no events since the balance sheet date to report.
Future developments
No changes are planned in the business operations of the company.
Auditor
In accordance with the company's articles, a resolution proposing that Ad Valorem Audit Services Limited be reappointed as auditor of the company will be put at a General Meeting.
AUDEMARS PIGUET (SLOANE STREET) UK LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -
Statement of disclosure to auditor
Each director in office at the date of approval of this annual report confirms that:
so far as the director is aware, there is no relevant audit information of which the company's auditor is unaware, and
the director has taken all the steps that he / she ought to have taken as a director in order to make himself / herself aware of any relevant audit information and to establish that the company's auditor is aware of that information.
This confirmation is given and should be interpreted in accordance with the provisions of section 418 of the Companies Act 2006.
On behalf of the board
D.Compton
Director
12 July 2024
AUDEMARS PIGUET (SLOANE STREET) UK LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 4 -
The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with International Financial Reporting Standards (IFRSs) as adopted by the United Kingdom. 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, International Accounting Standard 1 requires that directors:
properly select and apply accounting policies;
present information, including accounting policies, in a manner that provides relevant, reliable, comparable and understandable information;
provide additional disclosures when compliance with the specific requirements in IFRSs are insufficient to enable users to understand the impact of particular transactions, other events and conditions on the entity's financial position and financial performance; and
make an assessment of the company's ability to continue as a going concern.
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.
AUDEMARS PIGUET (SLOANE STREET) UK LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF AUDEMARS PIGUET (SLOANE STREET) UK LIMITED
- 5 -
Opinion
We have audited the financial statements of Audemars Piguet (Sloane Street) UK Limited (the 'company') for the year ended 31 December 2023 which comprise the income statement, the statement of financial position, the statement of changes in equity, the 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 UK adopted international accounting standards.
In our opinion the financial statements:
give a true and fair view of the state of the company's affairs as at 31 December 2023 and of its profit for the year then ended;
have been properly prepared in accordance with UK adopted international accounting standards; and
have been prepared in accordance with the requirements of the Companies Act 2006.
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the 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.
The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit:
the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
AUDEMARS PIGUET (SLOANE STREET) UK LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF AUDEMARS PIGUET (SLOANE STREET) UK LIMITED
- 6 -
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
adequate accounting records have not been kept, 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 directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the 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.
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.
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
AUDEMARS PIGUET (SLOANE STREET) UK LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF AUDEMARS PIGUET (SLOANE STREET) UK LIMITED
- 7 -
In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, we considered the following:
1) Enquiries of management concerning the company's policies and procedures relating to:
identifying, evaluating and complying with laws and regulations and whether they were aware of any instances of non-compliance
detecting and responding to the risks of fraud and whether they have knowledge of any actual, suspected or alleged fraud; and
the internal controls established to mitigate risks related to fraud or non-compliance with laws and regulations;
2) The company's remuneration policies, key drivers for remuneration and bonus levels; and
3) Discussions among the engagement team regarding how and when fraud might occur in the financial statements and any potential indicators of fraud.
In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override.
We also obtained an understanding of the legal and regulatory framework that the company operates in, focusing on provisions of those laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements. The key laws and regulations we considered in this context included the UK Companies Act and IFRS as issued by the IASB and adopted by the EU.
.
In addition, we considered provisions of other laws and regulations that do not have a direct effect on the financial statements but compliance with which may be fundamental to the company's ability to operate or avoid a material penalty.
As a result of performing the above, we did not identify any key audit matters related to the potential risk of fraud or non-compliance with laws and regulations.
In addition to the above, our procedures to respond to risks identified included the following:
Reviewing the financial statement disclosures and testing to supporting documentation to assess compliance with provisions of relevant laws and regulations described as having a direct effect on the financial statements;
Enquiring of management concerning actual and potential litigation and claims;
Performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud;
Reading minutes of meetings of those charged with governance and reviewing correspondence with relevant tax authorities; and
In addressing the risk of fraud through management override of controls, testing the appropriateness of journal entries and other adjustments; assessing whether the judgments made in making accounting estimates are indicative of a potential bias; and evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business.
We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members, and remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit.
We note that our audit is not primarily designed to detect non-compliance with laws and regulations and the Directors and other management are responsible for such internal control as the Directors and other management of the Company determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to errors or fraud, including compliance with laws and regulations. Additionally, 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. We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations.
AUDEMARS PIGUET (SLOANE STREET) UK LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF AUDEMARS PIGUET (SLOANE STREET) UK LIMITED
- 8 -
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.
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.
Darren Kerins FCCA (Senior Statutory Auditor)
For and on behalf of Ad Valorem Audit Services Limited
12 July 2024
Chartered Certified Accountants
Statutory Auditor
Chartered Certified Accountants & Registered Auditors
2 Manor Farm Court
Old Wolverton Road
Old Wolverton
Milton Keynes
Buckinghamshire
MK12 5NN
AUDEMARS PIGUET (SLOANE STREET) UK LIMITED
INCOME STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 9 -
2023
2022
Notes
£
£
Revenue
2
15,335,025
14,243,485
Cost of sales
(10,186,973)
(9,432,661)
Gross profit
5,148,052
4,810,824
Administrative expenses
(1,661,418)
(1,967,057)
Operating profit
3
3,486,634
2,843,767
Investment revenues
6
50,729
Finance costs
7
(51,716)
(57,095)
Profit before taxation
3,485,647
2,786,672
Income tax expense
8
(841,920)
(569,625)
Profit and total comprehensive income for the year
2,643,727
2,217,047
The income statement has been prepared on the basis that all operations are continuing operations.
AUDEMARS PIGUET (SLOANE STREET) UK LIMITED
STATEMENT OF FINANCIAL POSITION
AS AT
31 DECEMBER 2023
31 December 2023
- 10 -
2023
2022
Notes
£
£
Non-current assets
Property, plant and equipment
10
3,540,785
4,289,373
Deferred tax asset
16
20,141
3,560,926
4,289,373
Current assets
Inventories
11
1,943,062
808,664
Trade and other receivables
12
403,295
373,012
Current tax recoverable
70,016
Cash and cash equivalents
4,389,651
5,278,984
6,736,008
6,530,676
Current liabilities
Trade and other payables
14
3,593,006
3,976,453
Current tax liabilities
38,019
Lease liabilities
15
408,736
403,284
4,039,761
4,379,737
Net current assets
2,696,247
2,150,939
Non-current liabilities
Lease liabilities
15
3,013,446
3,422,182
Deferred tax liabilities
16
38,130
3,013,446
3,460,312
Net assets
3,243,727
2,980,000
Equity
Called up share capital
18
600,000
600,000
Retained earnings
2,643,727
2,380,000
Total equity
3,243,727
2,980,000
The financial statements were approved by the board of directors and authorised for issue on 12 July 2024 and are signed on its behalf by:
D.Compton
Director
Company registration number 12091959 (England and Wales)
AUDEMARS PIGUET (SLOANE STREET) UK LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 11 -
Share capital
Retained earnings
Total
Notes
£
£
£
Balance at 1 January 2022
600,000
2,162,953
2,762,953
Year ended 31 December 2022:
Profit and total comprehensive income
-
2,217,047
2,217,047
Transactions with owners:
Dividends
9
-
(2,000,000)
(2,000,000)
Balance at 31 December 2022
600,000
2,380,000
2,980,000
Year ended 31 December 2023:
Profit and total comprehensive income
-
2,643,727
2,643,727
Transactions with owners:
Dividends
9
-
(2,380,000)
(2,380,000)
Balance at 31 December 2023
600,000
2,643,727
3,243,727
AUDEMARS PIGUET (SLOANE STREET) UK LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 12 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
23
2,765,346
3,868,772
Interest paid
(51,716)
(57,095)
Income taxes paid
(792,156)
(792,118)
Net cash inflow from operating activities
1,921,474
3,019,559
Investing activities
Purchase of property, plant and equipment
(78,252)
(254,112)
Interest received
50,729
Net cash used in investing activities
(27,523)
(254,112)
Financing activities
Payment of lease liabilities
(403,284)
(397,905)
Dividends paid
(2,380,000)
(2,000,000)
Net cash used in financing activities
(2,783,284)
(2,397,905)
Net (decrease)/increase in cash and cash equivalents
(889,333)
367,542
Cash and cash equivalents at beginning of year
5,278,984
4,911,442
Cash and cash equivalents at end of year
4,389,651
5,278,984
AUDEMARS PIGUET (SLOANE STREET) UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 13 -
1
Accounting policies
Company information
Audemars Piguet (Sloane Street) UK Limited is a private company limited by shares incorporated in England and Wales. The registered office is 82-84 Grosvenor Street, 1st Floor, London, W1K 3JZ. The company's principal activities and nature of its operations are disclosed in the directors' report.
1.1
Accounting convention
The financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted for use in the United Kingdom and with those parts of the Companies Act 2006 applicable to companies reporting under IFRS, except as otherwise stated.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
1.2
Going concern
The directors have at the time of approving the financial statements, a reasonable expectation that the truecompany has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
1.3
Revenue
Revenue comprises the fair value of the consideration received or receivable for the sale of goods in the ordinary course of the company’s activities. Revenue is shown net of value-added tax, returns, rebates and discounts.
The company recognises revenue when the amount of revenue can be reliably measured; it is probable that future economic benefits will flow to the entity and when specific criteria have been met for each of the company's activities. The amount of revenue is not considered to be reliably measurable until all contingencies relating to the sale have been resolved. The company bases its estimates on historical results, taking into consideration the type of customer, the type of transaction and the specifics of each arrangement.
1.4
Property, plant and equipment
Property, plant and equipment 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:
Computers
33% on cost
Promotional display & boutiques
10% to 20% on cost
Essential watches
Over 5 years on cost less residual value
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 income statement.
1.5
Impairment of tangible and intangible assets
At each reporting end date, the company reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
AUDEMARS PIGUET (SLOANE STREET) UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 14 -
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.
Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
1.6
Inventories
Inventories 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 inventories to their present location and condition.
Inventories held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.
Items of inventories that have been held in stock for a period of at least 12 months are provided for based on a provision of up to 30% of cost.
1.7
Fair value measurement
IFRS 13 establishes a single source of guidance for all fair value measurements. IFRS 13 does not change when an entity is required to use fair value, but rather provides guidance on how to measure fair value under IFRS when fair value is required or permitted. The resulting calculations under IFRS 13 affected the principles that the company uses to assess the fair value, but the assessment of fair value under IFRS 13 has not materially changed the fair values recognised or disclosed. IFRS 13 mainly impacts the disclosures of the company. It requires specific disclosures about fair value measurements and disclosures of fair values, some of which replace existing disclosure requirements in other standards.
1.8
Cash and cash equivalents
Cash and cash equivalents 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.
AUDEMARS PIGUET (SLOANE STREET) UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 15 -
1.9
Financial assets
Financial assets are recognised in the company's statement of financial position when the company becomes party to the contractual provisions of the instrument. Financial assets are classified into specified categories, depending on the nature and purpose of the financial assets.
At initial recognition, financial assets classified as fair value through profit and loss are measured at fair value and any transaction costs are recognised in profit or loss. Financial assets not classified as fair value through profit and loss are initially measured at fair value plus transaction costs.
Trade receivables
Trade receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method, less provision for impairment. A provision for impairment of trade receivables is established when there is objective evidence that the company will not be able to collect all amounts due according to the original terms of the receivables. Significant financial difficulties of the debtor, probability that the debtor will enter bankruptcy or financial reorganisation, and default or delinquency in payments (more than 30 days overdue) are considered indicators that the trade receivable is impaired. The amount of the provision is the difference between the asset's carrying amount and the present value of estimated future cash flows, discounted at the original effective interest rate. The carrying amount of the asset is reduced through the use of an allowance account. When a trade receivable is uncollectible, it is written off against the allowance account for trade receivables. Subsequent recoveries of amounts previously written off are credited against 'selling and marketing costs' in the income statement.
1.10
Financial liabilities
The company recognises financial debt when the company becomes a party to the contractual provisions of the instruments. Financial liabilities are classified as either 'financial liabilities at fair value through profit or loss' or 'other financial liabilities'.
Trade payables
Trade payables are recognised initially at fair value and subsequently measured at amortised cost. They are not interest bearing and are stated at their nominal value.
1.11
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of direct issue costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
1.12
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 income statement because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
AUDEMARS PIGUET (SLOANE STREET) UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 16 -
Deferred tax
Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit, and is accounted for using the balance sheet liability method. Deferred tax liabilities are generally recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised. Such assets and liabilities are not recognised if the temporary 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 income statement, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
1.13
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 inventories or non-current 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.
1.14
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.15
Leases
At inception, the company assesses whether a contract is, or contains, a lease within the scope of IFRS 16. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. Where a tangible asset is acquired through a lease, the company recognises a right-of-use asset and a lease liability at the lease commencement date. Right-of-use assets are included within property, plant and equipment, apart from those that meet the definition of investment property.
The right-of-use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date plus any initial direct costs and an estimate of the cost of obligations to dismantle, remove, refurbish or restore the underlying asset and the site on which it is located, less any lease incentives received.
The right-of-use asset is subsequently depreciated using the straight-line method from the commencement date to the earlier of the end of the useful life of the right-of-use asset or the end of the lease term. The estimated useful lives of right-of-use assets are determined on the same basis as those of other property, plant and equipment. The right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability.
AUDEMARS PIGUET (SLOANE STREET) UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 17 -
The lease liability is initially measured at the present value of the lease payments that are unpaid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the company's incremental borrowing rate. Lease payments included in the measurement of the lease liability comprise fixed payments, variable lease payments that depend on an index or a rate, amounts expected to be payable under a residual value guarantee, and the cost of any options that the company is reasonably certain to exercise, such as the exercise price under a purchase option, lease payments in an optional renewal period, or penalties for early termination of a lease.
The lease liability is measured at amortised cost using the effective interest method. It is remeasured when there is a change in: future lease payments arising from a change in an index or rate; the company's estimate of the amount expected to be payable under a residual value guarantee; or the company's assessment of whether it will exercise a purchase, extension or termination option. When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of the right-of-use asset, or is recorded in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero.
The company has elected not to recognise right-of-use assets and lease liabilities for short-term leases of machinery that have a lease term of 12 months or less, or for leases of low-value assets including IT equipment. The payments associated with these leases are recognised in profit or loss on a straight-line basis over the lease term.
1.16
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
Revenue
2023
2022
£
£
Revenue analysed by class of business
Sale of watches and accessories
15,335,025
14,243,485
2023
2022
£
£
Revenue analysed by geographical market
UK
15,335,025
14,243,485
3
Operating profit
2023
2022
Operating profit for the year is stated after charging/(crediting):
£
£
Exchange losses
2,847
3,293
Depreciation of property, plant and equipment
643,698
623,589
Cost of inventories recognised as an expense
10,117,511
9,414,076
Write downs of inventories recognised as an expense
69,462
18,585
AUDEMARS PIGUET (SLOANE STREET) UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 18 -
4
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the company
13,000
10,000
5
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
4
4
Their aggregate remuneration comprised:
2023
2022
£
£
Wages and salaries
322,132
389,488
Social security costs
40,035
42,113
Pension costs
13,081
20,181
375,248
451,782
6
Investment income
2023
2022
£
£
Interest income
Financial instruments measured at amortised cost:
Other interest
50,729
7
Finance costs
2023
2022
£
£
Interest on lease liabilities
51,716
57,095
AUDEMARS PIGUET (SLOANE STREET) UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 19 -
8
Income tax expense
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
861,566
500,145
Adjustments in respect of prior periods
38,625
22,489
Total UK current tax
900,191
522,634
Deferred tax
Origination and reversal of temporary differences
(58,271)
46,991
Total tax charge
841,920
569,625
The charge for the year can be reconciled to the profit per the income statement as follows:
2023
2022
£
£
Profit before taxation
3,485,647
2,786,672
Expected tax charge based on a corporation tax rate of 23.52% (2022: 19.00%)
819,824
529,468
Effect of expenses not deductible in determining taxable profit
66,542
53,616
Under/(over) provided in prior years
38,625
8,600
Other
(58,252)
(69,050)
Capital allowances
(24,819)
46,991
Other
(58,252)
Taxation charge for the year
783,668
569,625
Tax charged in the financial statements
841,920
569,625
Please review figures in the database. The tax charge does not reconcile by:
(58,252)
-
Pillar Two legislation has been enacted or substantively enacted in certain jurisdictions where the Group operates. The legislation will be effective for the Group’s financial year beginning 1 January 2024. The Group is in scope of the enacted or substantively enacted legislation and has performed an assessment of the Group’s potential exposure to Pillar Two income taxes.
This assessment of the potential exposure to Pillar Two income taxes is based on the most recent tax filings, country-by-country reporting and financial statements for the constituent entities in the Group.
In the UK, the effective tax rate for the Company is above 15% and therefore it does not expect a potential exposure to Pillar Two top-up taxes.
AUDEMARS PIGUET (SLOANE STREET) UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 20 -
9
Dividends
2023
2022
2023
2022
Amounts recognised as distributions:
per share
per share
Total
Total
£
£
£
£
Ordinary
Interim dividend paid
3.97
3.33
2,380,000
2,000,000
10
Property, plant and equipment
Computers
Promotional display & boutiques
Essential watches
Total
£
£
£
£
Cost
At 1 January 2022
5,000
5,255,839
5,260,839
Additions
87,029
167,083
254,112
At 31 December 2022
5,000
5,342,868
167,083
5,514,951
Additions
38,440
39,812
78,252
Transfer to held for sale
(206,895)
(206,895)
At 31 December 2023
5,000
5,381,308
5,386,308
Accumulated depreciation and impairment
At 1 January 2022
3,473
598,516
601,989
Charge for the year
1,527
616,611
5,451
623,589
At 31 December 2022
5,000
1,215,127
5,451
1,225,578
Charge for the year
625,396
18,302
643,698
On assets reclassified as held for sale
(23,753)
(23,753)
At 31 December 2023
5,000
1,840,523
1,845,523
Carrying amount
At 31 December 2023
-
3,540,785
-
3,540,785
At 31 December 2022
-
4,127,741
161,632
4,289,373
Property, plant and equipment includes right-of-use assets, as follows:
Promotional display & boutiques includes a premises lease capitalised in accordance with IFRS16. Acquisition cost is £4,420,988 (2022: £4,420,988), Accumulated depreciation is £1,105,247 (2022: £663,148).
AUDEMARS PIGUET (SLOANE STREET) UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 21 -
11
Inventories
2023
2022
£
£
Raw materials
197,237
148,158
Finished goods
1,745,825
660,506
1,943,062
808,664
Inventories have been stated after a provision of £88,046 (2022: £18,584) for slow moving items.
12
Trade and other receivables
2023
2022
£
£
Trade receivables
278,791
227,834
Other receivables
3,739
1,000
Prepayments
120,765
144,178
403,295
373,012
Trade receivables disclosed above are classified as loans and receivables and are therefore measured at amortised cost.
13
Trade receivables - credit risk
Fair value of trade receivables
The directors consider that the carrying amount of trade and other receivables is approximately equal to their fair value.
Expected credit loss assessment
2023
2022
Balance
Rate
Loss allowance
Balance
Rate
Loss allowance
Trade receivables
£
%
£
£
%
£
Current
270,050
-
-
218,929
-
-
31-60 days
5,621
-
-
5,844
-
-
61-90 days
-
-
-
2,617
-
-
90 days +
3,120
-
-
444
-
-
278,791
-
227,834
-
No significant receivable balances are impaired at the reporting end date.
AUDEMARS PIGUET (SLOANE STREET) UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 22 -
14
Trade and other payables
2023
2022
£
£
Trade payables
144,953
37,552
Amount owed to parent undertaking
3,325,381
3,589,475
Accruals
69,543
83,307
Social security and other taxation
53,129
266,119
3,593,006
3,976,453
15
Lease liabilities
2023
2022
Maturity analysis
£
£
Within one year
408,736
403,284
In two to five years
1,690,953
1,668,398
In over five years
1,322,493
1,753,784
Total undiscounted liabilities
3,422,182
3,825,466
Lease liabilities are classified based on the amounts that are expected to be settled within the next 12 months and after more than 12 months from the reporting date, as follows:
2023
2022
£
£
Current liabilities
408,736
403,284
Non-current liabilities
3,013,446
3,422,182
3,422,182
3,825,466
2023
2022
Amounts recognised in profit or loss include the following:
£
£
Interest on lease liabilities
51,716
57,095
Other leasing information is included in note 19.
16
Deferred taxation
Liabilities
Assets
2023
2022
2023
2022
£
£
£
£
Deferred tax balances
38,130
20,141
Deferred tax assets are expected to be recovered after more than one year.
AUDEMARS PIGUET (SLOANE STREET) UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
16
Deferred taxation
(Continued)
- 23 -
The following are the major deferred tax liabilities and assets recognised by the company and movements thereon during the current and prior reporting period.
ACAs
£
Asset at 1 January 2022
(8,861)
Deferred tax movements in prior year
Charge/(credit) to profit or loss
46,991
Liability at 1 January 2023
38,130
Deferred tax movements in current year
Charge/(credit) to profit or loss
(58,271)
Asset at 31 December 2023
(20,141)
Deferred tax assets and liabilities are offset in the financial statements only where the company has a legally enforceable right to do so.
17
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
13,081
20,181
The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.
18
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary of £1 each
600,000
600,000
600,000
600,000
19
Other leasing information
Lessee
Amounts recognised in profit or loss as an expense during the period in respect of lease arrangements are as follows: £nil (2022: £nil)
Information relating to lease liabilities is included in note 15.
AUDEMARS PIGUET (SLOANE STREET) UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 24 -
20
Capital risk management
The company is not subject to any externally imposed capital requirements.
21
Related party transactions
Remuneration of key management personnel
The remuneration of key management personnel, including directors, is set out below in aggregate for each of the categories specified in IAS 24 Related Party Disclosures.
The key management for 2023 and 2022 are the directors of the company who are remunerated by other group companies and did not receive any emoluments from this company.
Other transactions with related parties
During the year the company entered into the following transactions with related parties:
Sale of goods
Purchase of goods
2023
2022
2023
2022
£
£
£
£
Parent company
11,245,046
9,366,167
Associates
75,882
73,919
11,320,928
9,440,086
During the year the company paid a management charge of £50,336 (2022: £84,835) to its parent company Audemars Piguet (UK) Limited and £21,020 (2022: £20,246) to associates.
During the year the company paid £83,948 (2022: £192,852) for expenses included in administrative expenses to its parent company Audemars Piguet (UK) Limited.
During the year the company was charged rent amounting to £455,000 (2022: £455,000) and administrative expenses amounting to a net credit of £31,140 (2022: net expense £411) to Arije SAS, which is a shareholder of the company.
The following amounts were outstanding at the reporting end date:
2023
2022
Amounts due to related parties
£
£
Parent company
3,325,381
3,589,475
Entities with joint control or significant influence over the company
113,750
Associates
368
3,439,499
3,589,475
AUDEMARS PIGUET (SLOANE STREET) UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
21
Related party transactions
(Continued)
- 25 -
The following amounts were outstanding at the reporting end date:
2023
2022
Amounts due from related parties
£
£
Associates
3,739
-
22
Controlling party
The immediate parent undertaking is Audemars Piguet (UK) Limited. The smallest group for which group accounts are prepared and of which the Company is a member is Audemars Piguet (UK) Limited, whose accounts are available from 82-84 Grosvenor Street, 1st Floor, London, W1K 3JZ.
The ultimate parent undertaking and controlling party is Audemars Piguet Holding SA, registered in Switzerland. The largest group for which group accounts are prepared and of which the Company is a member is Audemars Piguet Holding SA, whose accounts are available from Case postale 16, 1348 Le Brassus, Switzerland.
23
Cash generated from operations
2023
2022
£
£
Profit for the year before income tax
3,485,647
2,786,672
Adjustments for:
Finance costs
51,716
57,095
Investment income
(50,729)
Depreciation and impairment of property, plant and equipment
643,698
623,589
Movements in working capital:
Increase in inventories
(951,256)
(10,016)
Increase in trade and other receivables
(30,283)
(70,981)
(Decrease)/increase in trade and other payables
(383,447)
482,413
Cash generated from operations
2,765,346
3,868,772
24
Analysis of changes in net funds
1 January 2023
Cash flows
31 December 2023
£
£
£
Cash at bank and in hand
5,278,984
(889,333)
4,389,651
Obligations under finance leases
(3,825,466)
403,284
(3,422,182)
1,453,518
(486,049)
967,469
AUDEMARS PIGUET (SLOANE STREET) UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
24
Analysis of changes in net funds
(Continued)
- 26 -
1 January 2022
Cash flows
31 December 2022
Prior year:
£
£
£
Cash at bank and in hand
4,911,442
367,542
5,278,984
Obligations under finance leases
(4,223,371)
397,905
(3,825,466)
688,071
765,447
1,453,518
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