Company registration number 02014181 (England and Wales)
EVERGREEN EXTERIOR SERVICES LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
EVERGREEN EXTERIOR SERVICES LIMITED
COMPANY INFORMATION
Directors
L Weeks
D J C Cumber
C A Marshall
L A Gibbs
Secretary
L Weeks
Company number
02014181
Registered office
Seasons Nursery
21 Croydon Lane
Banstead
Surrey
SM7 3BW
Auditor
Beavis Morgan Audit Limited
82 St John Street
London
EC1M 4JN
EVERGREEN EXTERIOR SERVICES LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2
Directors' responsibilities statement
3
Independent auditor's report
4 - 6
Statement of comprehensive income
7
Balance sheet
8
Statement of changes in equity
9
Statement of cash flows
10
Notes to the financial statements
11 - 23
EVERGREEN EXTERIOR SERVICES LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -
The directors present their strategic report for the year ended 31 December 2023.
Fair review of the business
The directors are pleased to report that the company's results and financial position for the year ended 31 December 2023 exceeded expectations. If market conditions continue to improve and provided the weather conditions remain clement, the directors fully expect the company to continue to trade more profitably in the coming years. The company has cash reserves of £2.22m, down from £2.99m last year, which provides the company with adequate funds with which to meet day to day spending requirements, as well as to make capital investments where it sees fit. The group of which the company is a member was restructured during 2022 which enabled completion of the succession planning.
Principal risks and uncertainties
The main exposures to risk are adverse weather conditions, reducing sales, and the potential loss of stock. The
predominant financial risk is the movement in foreign exchange rates with the euro. At present, any movements in
the exchange rate between the euro and sterling are absorbed in the gross margin by the company.
Financial instruments
The company's principal financial instruments comprise bank balances, trade creditors and trade debtors. The main purpose of these instruments is to raise funds for the company's operations. Due to the nature of the financial instruments used by the company, there is no exposure to price risk. Trade debtors are managed in respect of credit and cash flow risk policies concerning the credit offered to customers and regular monitoring of amounts outstanding for both time and credit limits. Trade creditors liquidity risk is managed by ensuring sufficient funds are available to meet financial obligations as they fall due. In respect of bank balances, liquidity risk is managed by maintaining the balance between the continuity of funding and flexibility through deposits at floating rates of interest.
Key performance indicators
The key financial indicators against which the directors measure the company's performance are gross margin and stock turnover. Stock turnover for the period was 12 (2022: 15) days to the satisfaction of the directors, which is a positive sign in an industry where stock is often perishable. The gross profit margin was maintained at 17.58% (2022: 17.46%) to the satisfaction of the directors.
C A Marshall
Director
6 August 2024
EVERGREEN EXTERIOR SERVICES 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 continued to be that of wholesalers of plants and shrubs.
Results and dividends
The results for the year are set out on page 7.
Ordinary dividends were paid during the year amounting to £2,187,848 (2022: £1,234,421). The directors do not recommend payment of a further dividend in respect of the year.
Matters covered in the strategic report
As permitted, certain matters which are required to be disclosed in the directors' report have been omitted as they are included in the strategic report on page 1. This includes future developments and information in relation to the company's financial risk management and objectives.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
L Weeks
D J C Cumber
C A Marshall
L A Gibbs
Auditor
In accordance with the company's articles, a resolution proposing that Beavis Morgan Audit Limited be reappointed as auditor of the company will be put at a General Meeting.
Statement of disclosure to auditor
The directors confirm that so far as they are aware, there is no relevant audit information (as defined by section 418(3) of the Companies Act 2006) of which the company's auditor is unaware. They have taken all the steps that they ought to have taken as directors in order to make themselves aware of any relevant audit information and to establish that the company's auditor is aware of that information.
On behalf of the board
C A Marshall
Director
6 August 2024
EVERGREEN EXTERIOR SERVICES LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -
The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:
- select suitable accounting policies and then apply them consistently;
- make judgements and accounting estimates that are reasonable and prudent;
- prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
EVERGREEN EXTERIOR SERVICES LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF EVERGREEN EXTERIOR SERVICES LIMITED
- 4 -
Opinion
We have audited the financial statements of Evergreen Exterior Services Limited (the 'company') for the year ended 31 December 2023 which comprise the statement of comprehensive income, the balance sheet, 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 United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
give a true and fair view of the state of the company's affairs as at 31 December 2023 and of its profit for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.
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.
EVERGREEN EXTERIOR SERVICES LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF EVERGREEN EXTERIOR SERVICES LIMITED
- 5 -
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 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.
Capability of the audit in detecting irregularities, including fraud
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, 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.
Discussions with and enquiries of management and those charged with governance were held with a view to identifying those laws and regulations that could be expected to have a material impact on the financial statements. During the engagement team briefing, the outcomes of these discussions and enquiries were shared with the team, as well as consideration as to where and how fraud may occur in the entity.
The following laws and regulations were identified as being of significance to the entity:
Those laws and regulations considered to have a direct effect on the financial statements include UK financial reporting standards, Company Law and Tax legislation; and
Those laws and regulations for which non-compliance may be fundamental to the operating aspects of the business and therefore may have a material effect on the financial statements include environmental regulations and health and safety legislation.
Audit procedures undertaken in response to the potential risks relating to irregularities (which include fraud and non-compliance with laws and regulations) comprised of: inquiries of management and those charged with governance as to whether the entity complies with such laws and regulations; enquiries with the same concerning any actual or potential litigation or claims; inspection of relevant legal correspondence; testing the appropriateness of journal entries; and the performance of analytical review to identify unexpected movements in account balances which may be indicative of fraud.
EVERGREEN EXTERIOR SERVICES LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF EVERGREEN EXTERIOR SERVICES LIMITED
- 6 -
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. Irregularities that result from fraud might be inherently more difficult to detect than irregularities that result from error. As explained above, there is an unavoidable risk that material misstatements may not be detected, even though the audit has been planned and performed in accordance with ISAs (UK).
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.
Matthew Burge (Senior Statutory Auditor)
For and on behalf of Beavis Morgan Audit Limited
6 August 2024
Chartered Accountants
Statutory Auditor
82 St John Street
London
EC1M 4JN
EVERGREEN EXTERIOR SERVICES LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
- 7 -
2023
2022
Notes
£
£
Turnover
3
23,859,020
23,647,645
Cost of sales
(19,665,220)
(19,519,764)
Gross profit
4,193,800
4,127,881
Administrative expenses
(2,154,065)
(2,010,892)
Other operating income
3
62,012
62,012
Operating profit
4
2,101,747
2,179,001
Interest receivable and similar income
8
36,795
6,350
Interest payable and similar expenses
9
(5,577)
(6,485)
Profit before taxation
2,132,965
2,178,866
Tax on profit
10
(486,758)
(378,645)
Profit for the financial year
1,646,207
1,800,221
The statement of comprehensive income has been prepared on the basis that all operations are continuing operations.
EVERGREEN EXTERIOR SERVICES LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2023
31 December 2023
- 8 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
12
1,303,409
1,296,223
Current assets
Stocks
13
667,321
793,010
Debtors
14
1,327,451
1,513,174
Cash at bank and in hand
2,221,745
2,990,500
4,216,517
5,296,684
Creditors: amounts falling due within one year
15
(3,204,053)
(3,664,293)
Net current assets
1,012,464
1,632,391
Total assets less current liabilities
2,315,873
2,928,614
Creditors: amounts falling due after more than one year
16
(14,449)
(66,162)
Provisions for liabilities
18
(104,651)
(124,038)
Net assets
2,196,773
2,738,414
Capital and reserves
Called up share capital
20
14,817
14,817
Share premium account
78,785
78,785
Capital redemption reserve
21
17,167
17,167
Profit and loss reserves
2,086,004
2,627,645
Total equity
2,196,773
2,738,414
The financial statements were approved by the board of directors and authorised for issue on 6 August 2024 and are signed on its behalf by:
C A Marshall
Director
Company Registration No. 02014181
EVERGREEN EXTERIOR SERVICES LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 9 -
Share capital
Share premium account
Capital redemption reserve
Profit and loss reserves
Total
Notes
£
£
£
£
£
Balance at 1 January 2022
14,817
78,785
17,167
2,061,845
2,172,614
Year ended 31 December 2022:
Profit and total comprehensive income for the year
-
-
-
1,800,221
1,800,221
Dividends
11
-
-
-
(1,234,421)
(1,234,421)
Balance at 31 December 2022
14,817
78,785
17,167
2,627,645
2,738,414
Year ended 31 December 2023:
Profit and total comprehensive income for the year
-
-
-
1,646,207
1,646,207
Dividends
11
-
-
-
(2,187,848)
(2,187,848)
Balance at 31 December 2023
14,817
78,785
17,167
2,086,004
2,196,773
EVERGREEN EXTERIOR SERVICES LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 10 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
26
2,237,907
2,215,052
Interest paid
(5,577)
(6,485)
Income taxes paid
(621,240)
(76,921)
Net cash inflow from operating activities
1,611,090
2,131,646
Investing activities
Purchase of tangible fixed assets
(138,506)
(23,016)
Interest received
36,795
6,350
Net cash used in investing activities
(101,711)
(16,666)
Financing activities
Repayment of finance lease obligations
(90,286)
(141,249)
Dividends paid
(2,187,848)
(1,234,421)
Net cash used in financing activities
(2,278,134)
(1,375,670)
Net (decrease)/increase in cash and cash equivalents
(768,755)
739,310
Cash and cash equivalents at beginning of year
2,990,500
2,251,190
Cash and cash equivalents at end of year
2,221,745
2,990,500
EVERGREEN EXTERIOR SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 11 -
1
Accounting policies
Company information
Evergreen Exterior Services Limited is a company limited by shares, incorporated in England and Wales. The registered office is Seasons Nursery, 21 Croydon Lane, Banstead, Surrey, SM7 3BW.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
Under section 454 of the Companies Act 2006, the directors can, on a voluntary basis, amend these financial statements if they subsequently prove to be defective.
1.2
Going concern
Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
1.3
Turnover
The turnover shown in the statement of comprehensive income represents the value of all goods sold during the period, less returns received, at selling price exclusive of VAT. Sales are recognised at the point at which the company has fulfilled its contractual obligations and the risks and rewards attached to the product have been transferred to the customer.
1.4
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:
Land and buildings freehold
2% straight line. Land is not depreciated.
Fixtures, fittings & equipment
15% reducing balance
Computer equipment
25% straight line
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 credited or charged to profit or loss.
1.5
Stocks
Stocks are stated at the lower of cost and net realisable value, after making allowance for obsolete and slow-moving items.
1.6
Cash and cash equivalents
Cash at bank and in hand are basic financial assets and include cash in hand and deposits held at call with banks.
EVERGREEN EXTERIOR SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 12 -
1.7
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include trade and other 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.
Impairment of financial assets
Financial assets are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
EVERGREEN EXTERIOR SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 13 -
Basic financial liabilities
Basic financial liabilities, including trade and other creditors, 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.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
1.8
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
1.9
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 statement of comprehensive income 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.
Deferred tax
Deferred taxation is provided in full in respect of taxation deferred by timing differences between the treatment of certain items for taxation and accounting purposes. The deferred tax balance has not been discounted.
Deferred tax assets are recognised only to the extent that the directors consider it more likely than not that there will be suitable taxable profits from which the future reversal of the underlying timing differences can be deducted.
1.10
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense.
1.11
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due. The assets of the scheme are held separately from those of the company in an independently administered fund.
EVERGREEN EXTERIOR SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 14 -
1.12
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 asset's fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.
Rentals payable under operating leases, including any lease incentives received, are charged against income on a straight line basis over the lease term.
Rental income on property owned by the company is recognised when it falls due according to the relevant lease agreements.
1.13
Foreign exchange
Monetary assets and liabilities denominated in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are recorded at the rate ruling at the date of the transaction. All differences are taken to profit or loss.
2
Judgements and key sources of estimation uncertainty
In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
Key sources of estimation uncertainty
The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.
Estimated useful lives of tangible fixed assets (note 12)
Estimation is required on determining the useful lives of such assets and their residual values.
Stock (note 13)
Estimation is required in determining the provision for slow moving stock.
EVERGREEN EXTERIOR SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 15 -
3
Turnover and other revenue
An analysis of the company's turnover is as follows:
2023
2022
£
£
Turnover analysed by class of business
Market sales
2,023,604
1,432,550
Nursery sales
19,779,175
20,849,356
Christmas tree sales
2,056,241
1,365,739
23,859,020
23,647,645
2023
2022
£
£
Other revenue
Interest income
36,795
6,350
Rent receivable
62,012
62,012
The total turnover of the company for the year and prior year have been derived from its principal activity wholly undertaken in the United Kingdom.
4
Operating profit
2023
2022
Operating profit for the year is stated after charging/(crediting):
£
£
Exchange (gains)/losses
(26,385)
29,076
Depreciation of owned tangible fixed assets
77,541
73,659
Depreciation of tangible fixed assets held under finance leases
53,779
68,348
Cost of stocks recognised as an expense
16,855,912
16,621,436
Operating lease charges
117,844
165,296
5
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the company
20,000
20,000
EVERGREEN EXTERIOR SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 16 -
6
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Administrative staff
3
3
Nursery staff
54
55
Directors
4
4
61
62
Their aggregate remuneration comprised:
2023
2022
£
£
Wages and salaries
2,632,059
2,604,182
Social security costs
362,509
279,036
Pension costs
48,767
48,997
3,043,335
2,992,521
7
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
507,500
445,000
Company pension contributions to defined contribution schemes
3,963
3,522
511,463
448,522
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 3 (2022 - 3).
Remuneration disclosed above include the following amounts paid to the highest paid director:
2023
2022
£
£
Remuneration for qualifying services
157,500
136,667
Company pension contributions to defined contribution schemes
1,321
1,321
EVERGREEN EXTERIOR SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 17 -
8
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
36,697
6,350
Other interest income
98
Total income
36,795
6,350
9
Interest payable and similar expenses
2023
2022
£
£
Other finance costs
Interest on finance leases and hire purchase contracts
5,577
6,485
10
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
506,145
356,633
Deferred tax
Origination and reversal of timing differences
(19,387)
22,012
Total tax charge
486,758
378,645
The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:
2023
2022
£
£
Profit before taxation
2,132,965
2,178,866
Expected tax charge based on the standard rate of corporation tax in the UK of 23.52% (2022: 19.00%)
501,685
413,985
Tax effect of expenses that are not deductible in determining taxable profit
1,667
443
Group relief
(17,232)
(29,861)
Deferred tax rate change
(1,147)
5,282
Fixed asset differences
1,818
(11,204)
Income not taxable for tax purposes
(33)
Taxation charge for the year
486,758
378,645
EVERGREEN EXTERIOR SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 18 -
11
Dividends
2023
2022
£
£
Dividends paid
2,187,848
1,234,421
12
Tangible fixed assets
Land and buildings freehold
Fixtures, fittings & equipment
Motor vehicles
Total
£
£
£
£
Cost
At 1 January 2023
959,199
381,369
1,132,210
2,472,778
Additions
138,506
138,506
At 31 December 2023
959,199
519,875
1,132,210
2,611,284
Depreciation and impairment
At 1 January 2023
159,128
324,310
693,117
1,176,555
Depreciation charged in the year
7,729
13,818
109,773
131,320
At 31 December 2023
166,857
338,128
802,890
1,307,875
Carrying amount
At 31 December 2023
792,342
181,747
329,320
1,303,409
At 31 December 2022
800,071
57,059
439,093
1,296,223
The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.
2023
2022
£
£
Motor vehicles
161,336
273,514
13
Stocks
2023
2022
£
£
Goods for resale
667,321
793,010
EVERGREEN EXTERIOR SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 19 -
14
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
1,247,482
1,454,363
Other debtors
25,854
26,171
Prepayments and accrued income
54,115
32,640
1,327,451
1,513,174
15
Creditors: amounts falling due within one year
2023
2022
Notes
£
£
Obligations under finance leases
17
65,992
104,565
Trade creditors
2,037,906
2,312,993
Corporation tax
241,538
356,633
Other taxation and social security
746,860
799,871
Other creditors
10,880
Accruals and deferred income
100,877
90,231
3,204,053
3,664,293
16
Creditors: amounts falling due after more than one year
2023
2022
Notes
£
£
Obligations under finance leases
17
14,449
66,162
17
Finance lease obligations
2023
2022
Future minimum lease payments due under finance leases:
£
£
Within one year
65,992
104,565
In two to five years
14,449
66,162
80,441
170,727
Finance lease payments represent rentals payable by the company for certain motor vehicles. 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.
EVERGREEN EXTERIOR SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 20 -
18
Deferred taxation
Deferred tax assets and liabilities are offset where the 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
2023
2022
Balances:
£
£
Accelerated capital allowances
104,651
124,038
2023
Movements in the year:
£
Liability at 1 January 2023
124,038
Credit to profit or loss
(19,387)
Liability at 31 December 2023
104,651
19
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
48,767
48,997
The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.
20
Share capital
2023
2022
£
£
Ordinary share capital
Issued and fully paid
14,817 Ordinary shares of £1 each
14,817
14,817
EVERGREEN EXTERIOR SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 21 -
21
Capital and reserves
Called up share capital
This balance represents the nominal value of the shares issued by the company.
Share premium account
This balance represents the amount paid for share capital issued by the company over its nominal value.
Capital redemption reserve
This balance represents reserves used by the company to purchase shares for cancellation.
Profit and loss reserves
This balance represents the accumulation of profits and losses made by the company since its inception, less dividends paid.
22
Financial commitments, guarantees and contingent liabilities
There is a fixed charge over the freehold land at 53a Woodmansterne Lane, Wallington which relates to a loan note instrument to guarantee the liabilities of Evergreen E S Holdings Limited, the ultimate parent company. The total liabilities covered by this charge at 31 December 2023 amounted to £400,000.
EVERGREEN EXTERIOR SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 22 -
23
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
2023
2022
£
£
Within one year
43,716
30,430
Between two and five years
39,858
83,574
30,430
Lessor
At the reporting end date the company had contracted with tenants for the following minimum lease payments:
2023
2022
£
£
Within one year
10,512
10,512
24
Related party transactions
Key management personnel are considered to be the directors only. The disclosure of their compensation has been included in note 7 of the financial statements.
Compensation totalling £129,311 (2022: £92,750) was paid to close family members of key management personnel in respect of services provided during the year.
25
Ultimate controlling party
The company's immediate parent is Evergreen Exterior Services Holdings Limited, which holds 100% of the company's issued share capital and is incorporated in England and Wales. Evergreen Exterior Services Holdings Limited do not produce consolidated financial statements on behalf of the fact their parent, Evergreen E S Holdings Limited, does.
The ultimate parent undertaking is Evergreen E S Holdings Limited which is incorporated in England and Wales. The consolidated financial statements of Evergreen E S Holdings Limited are available for inspection on request at Seasons Nursery, 21 Croydon Lane, Banstead, Surrey, United Kingdom, SM7 3BW.
The company is not deemed to be under the control of any one particular individual.
EVERGREEN EXTERIOR SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 23 -
26
Cash generated from operations
2023
2022
£
£
Profit for the year after tax
1,646,207
1,800,221
Adjustments for:
Taxation charged
486,758
378,645
Finance costs
5,577
6,485
Investment income
(36,795)
(6,350)
Depreciation and impairment of tangible fixed assets
131,320
142,007
Movements in working capital:
Decrease/(increase) in stocks
125,689
(295,592)
Decrease in debtors
185,723
107,578
(Decrease)/increase in creditors
(306,572)
82,058
Cash generated from operations
2,237,907
2,215,052
27
Analysis of changes in net funds
1 January 2023
Cash flows
31 December 2023
£
£
£
Cash at bank and in hand
2,990,500
(768,755)
2,221,745
Obligations under finance leases
(170,727)
90,286
(80,441)
2,819,773
(678,469)
2,141,304
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