Company Registration No. 02473777 (England and Wales)
KINETICO UK LIMITED
FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
PAGES FOR FILING WITH REGISTRAR
KINETICO UK LIMITED
CONTENTS
Page
Statement of financial position
1
Notes to the financial statements
2 - 9
KINETICO UK LIMITED
STATEMENT OF FINANCIAL POSITION
AS AT
31 DECEMBER 2023
31 December 2023
- 1 -
2023
2022
Notes
£
£
£
£
Fixed assets
Intangible assets
3
85,260
78,159
Tangible assets
4
368,646
501,603
453,906
579,762
Current assets
Stocks
1,268,440
1,452,202
Debtors
5
2,192,621
2,165,598
Cash at bank and in hand
389,872
274,616
3,850,933
3,892,416
Creditors: amounts falling due within one year
6
(1,659,040)
(2,206,642)
Net current assets
2,191,893
1,685,774
Total assets less current liabilities
2,645,799
2,265,536
Provisions for liabilities
7
(82,426)
(97,280)
Net assets
2,563,373
2,168,256
Capital and reserves
Called up share capital
754,013
754,013
Profit and loss reserves
1,809,360
1,414,243
Total equity
2,563,373
2,168,256

The directors of the company have elected not to include a copy of the income statement within the financial statements.true

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

The financial statements were approved by the board of directors and authorised for issue on 30 July 2024 and are signed on its behalf by:
L D Blunden
Director
Company Registration No. 02473777
The notes on pages 8 to 15 form part of these financial statements.
KINETICO UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
1
Accounting policies
Company information

Kinetico UK Limited is a private company limited by shares incorporated in England and Wales. The registered office is Bridge House, Park Gate Business Centre, Park Gate, Hampshire, SO31 1FQ.

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 as applicable to companies subject to the small companies regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.

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 continue to closely monitor the potential impact of truethe cost-of-living crisis on 2023 financial results and have undertaken a detailed risk assessment to reverse stress-test the 2024 budget and cash-flow expectations, including four different hypothetical risk scenarios. These scenarios included modelling hypothetical volume downturns due to customer loss, the shut-down of a whole business division as well as hypothetical supply chain price increases above and beyond the prevailing inflation rate. While the directors do not foresee that any of these risk scenarios is likely to occur, the resultant cash-flow impact of each scenario is such that the business would maintain adequate cash reserves and financial resources to continue as a going concern until at least July 2025.

 

Based on the above, the directors have a reasonable expectation that the Company will continue operations and meet its liabilities as they fall due until at least July 2025 or a period of at least one year from the date of signing these accounts. Accordingly, they continue to adopt the going concern basis in preparing the Company’s financial statements.

1.3
Revenue

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the company and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised:

Sale of goods

 

Revenue from the sale of goods is recognised when all of the following conditions are satisfied:

 

 

 

 

 

KINETICO UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 3 -

Rendering of services

 

Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:

 

 

 

 

1.4
Intangible fixed assets other than goodwill

Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.

 

Intangible assets are amortised on a straight line basis over their estimated useful lives. The carrying value of intangibles is reviewed for impairment if events or changes in circumstances indicate the carrying value may not be recoverable.

 

All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed 10 years.

 

The estimated useful lives range as follows:

Computer software
33% straight line
Website development
33% straight line
Customer database
50% straight line or 33% straight line
1.5
Tangible fixed assets

Tangible fixed assets are initially measured at cost and subsequently measured at cost, net of depreciation and any impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

 

The carrying value of tangible fixed assets is reviewed for impairment if events or changes in circumstances indicate the carrying value may not be recoverable.

Depreciation is recognised so as to write off the cost of assets less their residual values over their useful lives on the following bases:

Leasehold property
over the term of the lease
Plant and equipment
25% straight line
Fixtures and fittings
25% reducing balance or 33% straight line
Motor vehicles
over the term of the vehicle lease

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.

KINETICO UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 4 -
1.6
Stocks

Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis. Work in progress and finished goods include labour and attributable overheads.

At each reporting date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in profit and loss.

1.7
Cash at bank and in hand

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.

1.8
Financial instruments
The Company only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in ordinary shares.
Debt instruments (other than those wholly repayable or receivable within one year), including loans and other accounts receivable and payable, are initially measured at present value of the future cash flows and subsequently at amortised cost using the effective interest method. Debt instruments that are payable or receivable within one year, typically trade debtors and creditors, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received. However, if the arrangements of a short-term instrument constitute a financing transaction, like the payment of a trade debt deferred beyond normal business terms or in case of an out-right short-term loan that is not at market rate, the financial asset or liability is measured, initially at the present value of future cash flows discounted at a market rate of interest for a similar debt instrument and subsequently at amortised cost, unless it qualifies as a loan from a director in the case of a small company, or a public benefit entity concessionary loan.
Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the Statement of Income and Retained Earnings.

For financial assets measured at amortised cost, the impairment loss is measured as the difference between an asset's carrying amount and the present value of estimated cash flows discounted at the asset's original effective interest rate. If a financial asset has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate determined under the contract.

For financial assets measured at cost less impairment, the impairment loss is measured as the difference between an asset's carrying amount and best estimate of the recoverable amount, which is an approximation of the amount that the Company would receive for the asset if it were to be sold at the reporting date.

Financial assets and liabilities are offset and the net amount reported in the Statement of Financial Position when there is an 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.
Debtors

Short term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.

Creditors

Short term creditors are measured at the transaction price. Other financial liabilities are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.

KINETICO UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 5 -
1.9
Dividends

Equity dividends are recognised when they become legally payable. Interim equity dividends are recognised when paid. Final equity dividends are recognised when approved by the shareholders.

1.10
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.

Deferred tax

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

 

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the 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.

1.11
Provisions

Provisions are made where an event has taken place that gives the Company a legal or constructive obligation that probably requires settlement by a transfer of economic benefit, and a reliable estimate can be made of the amount of the obligation.

 

Provisions are charged as an expense to the Statement of Income and Retained Earnings in the year that the Company becomes aware of the obligation, and are measured at the best estimate at the Statement of Financial Position date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties.

 

When payments are eventually made, they are charged to the provision carried in the Statement of Financial Position.

 

1.12
Pensions

 

Defined contribution pension plan

 

The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations.

 

The contributions are recognised as an expense in the Statement of Income and Retained Earnings when they fall due. Amounts not paid are shown in accruals as a liability in the Statement of Financial Position. The assets of the plan are held separately from the Company in independently administered funds.

KINETICO UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 6 -
1.13
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.

1.14

Interest income

Interest income is recognised in the Statement of Income and Retained Earnings using the effective interest method.

1.15

Operating leases: the Company as lessee

Rentals paid under operating leases are charged to the Statement of Income and Retained Earnings on a straight line basis over the lease term.

2
Employees

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

2023
2022
Number
Number
Staff
52
50
3
Intangible fixed assets
Computer Software (including website development)
Customer database
Total
£
£
£
Cost
At 1 January 2023
508,886
216,171
725,057
Additions
-
0
68,132
68,132
At 31 December 2023
508,886
284,303
793,189
Amortisation and impairment
At 1 January 2023
478,018
168,880
646,898
Amortisation charged for the year
15,607
45,424
61,031
At 31 December 2023
493,625
214,304
707,929
Carrying amount
At 31 December 2023
15,261
69,999
85,260
At 31 December 2022
30,868
47,291
78,159
KINETICO UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 7 -
4
Tangible fixed assets
Land and buildings (Leasehold)
Plant and equipment
Fixtures and fittings
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 January 2023
582,598
140,036
574,661
32,429
1,329,724
Additions
-
0
1,675
17,680
5,453
24,808
At 31 December 2023
582,598
141,711
592,341
37,882
1,354,532
Depreciation and impairment
At 1 January 2023
306,257
138,395
375,514
7,955
828,121
Depreciation charged in the year
69,313
905
76,033
11,514
157,765
At 31 December 2023
375,570
139,300
451,547
19,469
985,886
Carrying amount
At 31 December 2023
207,028
2,411
140,794
18,413
368,646
At 31 December 2022
276,341
1,641
199,147
24,474
501,603
5
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
768,807
932,647
Corporation tax recoverable
48,284
-
0
Amounts owed by group undertakings
745,837
802,135
Other debtors
125,374
58,243
Prepayments and accrued income
390,980
259,234
2,079,282
2,052,259
2023
2022
Amounts falling due after more than one year:
£
£
Other debtors
113,339
113,339
Total debtors
2,192,621
2,165,598

Amounts owed by group undertakings are paid on standard trade terms.

KINETICO UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 8 -
6
Creditors: amounts falling due within one year
2023
2022
£
£
Trade creditors
260,320
180,870
Amounts owed to group undertakings
87,755
860,624
Corporation tax
-
0
66,095
Other taxation and social security
394,778
301,041
Other creditors
270,093
184,167
Accruals and deferred income
646,094
613,845
1,659,040
2,206,642

Amounts owed to group undertakings are paid on standard trade terms.

7
Deferred taxation

The following are the deferred tax liabilities and assets recognised by the company and movements thereon:

Liabilities
Liabilities
2023
2022
Balances:
£
£
Accelerated capital allowances
82,603
99,396
Other timing differences
(177)
(2,116)
82,426
97,280
8
Audit report information

As the income statement has been omitted from the filing copy of the financial statements, the following information in relation to the audit report on the statutory financial statements is provided in accordance with s444(5B) of the Companies Act 2006:

The auditor's report was unqualified.

The senior statutory auditor was Jeremy Cooper.
The auditor was Crowe U.K. LLP.
9
Subsequent events

On 30 April 2024, Kinetico UK Limited purchased the trade and assets of Genus Water Limited for £3,439,832.  Both Kinetico UK Limited and Genus Water Limited are wholly owned subsidiaries of Kinetico UK Holdings Limited.

KINETICO UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 9 -
10
Operating lease commitments
Lessee

At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, as follows:

2023
2022
£
£
Land and buildings
Less than one year
289,385
292,852
Two to five years
1,015,568
750,887
In over five years
878,535
-
0
2,183,488
1,043,739
Other
Less than one year
91,555
81,230
Two to five years
151,144
103,076
In over five years
1,746
-
0
244,445
184,306
Total
Less than one year
380,940
374,082
Two to five years
1,166,712
853,963
In over five years
880,281
-
0
2,427,933
1,228,045
11
Controlling party

The smallest group consolidation to include the Company is Kinetico Incorporated, a company registered in the United States of America (Accounts are available at the company's registered address: 10845 Kinsman Road, Newbury, OH 44065, USA).

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