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Registered number: 13312061









HUNN GROUP LIMITED









ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2023

 
HUNN GROUP LIMITED
 
 
COMPANY INFORMATION


Directors
R G Hunn 
K Frost 
D Hunn 




Registered number
13312061



Registered office
Suite D, The Business Centre
Faringdon Avenue

Romford

Essex

RM3 8EN




Independent auditors
Clay Ratnage Daffin & Co Limited
Chartered Accountants & Statutory Auditors

Suite D, The Business Centre

Faringdon Avenue

Romford

Essex

RM3 8EN




Bankers
Barclays Bank PLC
1 Churchill Place

London

E14 5HP




Solicitors
Tees Law
Cathedral Place

Brentwood

Essex

CM14 4ES





 
HUNN GROUP LIMITED
 

CONTENTS



Page
Group strategic report
 
1
Directors' report
 
2 - 3
Independent auditors' report
 
4 - 7
Consolidated statement of comprehensive income
 
8
Consolidated balance sheet
 
9 - 10
Company balance sheet
 
11
Consolidated statement of changes in equity
 
12
Company statement of changes in equity
 
13
Consolidated statement of cash flows
 
14 - 15
Consolidated analysis of net debt
 
16
Notes to the financial statements
 
17 - 36


 
HUNN GROUP LIMITED
 
 
GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

Introduction
 
The company's principal activities are that of a holding company, rental property investment, provision of management services, and its subsidiary company's principal activity is that of recycling of metal waste, scrap and skip hire.

Business review
 
Having had regard to Section 417 of the Companies Act 2006 the directors consider the profit achieved on ordinary activities to be in accordance with their expectations, after taking into account general trading conditions prevailing during the year under review.
On 1 September 2022 the company acquired 75% of the Ordinary share capital of Scrapco Metal Recycling Limited.  The figures for Scrapco Metal Recycling Limited have been consolidated into these accounts from that date.  The turnover for the group is £21,380,055 with a gross profit margin of 28.5%.  The increase in group turnover is due to a full year of revenue included, where only 4 months were included in 2022.
The directors are continually mindful of the volatility of prices and the need to invest in plant and diversify the activities of the group where practicable. The directors have invested some £1.1m  in new plant to ensure the group remain competitive. 
Overall the 2023 results are in line with expectation. The directors expect 2024 to show reduced turnover when comparing year on year results for the subsidiary, but similar margins, as a result of the reduction in metal prices.  The directors are aware of the challenges as when prices are high they can fall sharply and have plans in place to mitigate the effect of this.

Principal risks and uncertainties
 
The directors regularly review issues, risks and uncertainties that face the group in order to plan ways to mitigate risk. 
The commodity prices, particularly when moving on a downward trend, present an ongoing challenge for the subsidiary to ensure they do not pay too much for material, while at the same time offering prices at a level sufficient to attract sellers. Stock holding during such times can lead to stock losses if prices work against the group.  
Material which is recycled is mostly destined for the emerging export markets. Economic buoyancy in those locations determine demand and consequently price. 
The subsidiary operates in a high value capital intensive industry. Individual items of plant can cost £3/4 million or more. Investment on such scale will be necessary for the company to retain its competitive edge and operate efficiently.
The subsidiary operates in an industry which is highly regulated by various Government agencies and compliance with increasing regulation always presents a risk in addition to escalating costs.

Financial key performance indicators
 
The gross profit of the group for the current year is 28.5% (2022 - 29.7%).  The current ratio is at 0.24:1 (2022 - 0.024:1).


This report was approved by the board on 26 July 2024 and signed on its behalf.



D Hunn
Director

Page 1

 
HUNN GROUP LIMITED
 
 
 
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

The directors present their report and the financial statements for the year ended 31 December 2023.

Directors' responsibilities statement

The directors are responsible for preparing the Group strategic report, the Directors' report and the consolidated 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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and the Group and of the profit or loss of the Group for that period.

 In preparing these financial statements, the directors are required to:


select suitable accounting policies for the Group's financial statements and then apply them consistently;

make judgments 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 Group 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 the Group and to enable them to ensure that the financial statements comply with the Companies Act 2006They are also responsible for safeguarding the assets of the Company and the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Results and dividends

The profit for the year, after taxation and minority interests, amounted to £278,043 (2022 - £254,969).

The directors do not recommend the payment of a dividend.

Directors

The directors who served during the year were:

R G Hunn 
K Frost 
D Hunn 

Future developments

The directors are not aware of any future developments which would have a significant effect on the company, other than as noted in the strategic report.

Page 2

 
HUNN GROUP LIMITED
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

Disclosure of information to auditors

Each of the persons who are directors at the time when this Directors' report is approved has confirmed that:
 
so far as the director is aware, there is no relevant audit information of which the Company and the Group's auditors are unaware, and

the director has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the Company and the Group's auditors are aware of that information.

Post balance sheet events

There have been no significant events affecting the Group since the year end.

Auditors

The auditorsClay Ratnage Daffin & Co Limitedwill be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

This report was approved by the board on 26 July 2024 and signed on its behalf.
 





D Hunn
Director

Page 3

 
HUNN GROUP LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF HUNN GROUP LIMITED
 

Opinion


We have audited the financial statements of Hunn Group Limited (the 'parent Company') and its subsidiaries (the 'Group') for the year ended 31 December 2023, which comprise the Consolidated statement of comprehensive income, the Consolidated balance sheet, the Company balance sheet, the Consolidated statement of cash flows, the Consolidated statement of changes in equity, the Company statement of changes in equity and the related notes, including a summary of significant accounting policiesThe 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 Group's and of the parent Company's affairs as at 31 December 2023 and of the Group's profit for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.


Basis for opinion


We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the Group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council'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 Group's or the parent Company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.


Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.


Other information


The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' report thereon. The directors are responsible for the other information contained within the Annual ReportOur 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.


Page 4

 
HUNN GROUP LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF HUNN GROUP LIMITED (CONTINUED)


Opinion on other matters prescribed by the Companies Act 2006
 

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


the information given in the Group 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 Group strategic report and the Directors' report have been prepared in accordance with applicable legal requirements.


Matters on which we are required to report by exception
 

In the light of the knowledge and understanding of the Group and the parent Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group 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 by the parent Company, or returns adequate for our audit have not been received from branches not visited by us; or
the parent Company 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 set out on page 2, 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 Group's and the parent Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Group or the parent Company or to cease operations, or have no realistic alternative but to do so.


Page 5

 
HUNN GROUP LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF HUNN GROUP LIMITED (CONTINUED)


Auditors' responsibilities for the audit of the financial statements
 

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an Auditors' 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 Group financial statements.


Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:
To identify risks of material misstatement due to fraud (“fraud risks”) we assessed events or conditions that could indicate an incentive or pressure to commit fraud or provide an opportunity to commit fraud. Our risk assessment procedures included:
• Obtaining an understanding of the legal and regulatory frameworks applicable to the group and the sectors in    which they operate.
• Obtained an understanding of how the group is complying with those legal and regulatory frameworks by making         making enquiries to the management of the company’s accounting department, and management itself.
• The susceptibility of the group’s financial statements to material misstatement caused by fraud or other     irregularities were assessed with the following procedures:
 o Identifying and assessing the design effectiveness of controls which management have in place to prevent     and detect fraud
 o Understanding how those charged with governance considered and addressed the potential for override of     controls and management biases
 o Identifying and testing journal entries, in particular any journal entries posted with unusual account      combinations
 o Assessing the extent of compliance with the relevant laws and regulations
 o Assessing the extent to which pressures existed which may have increased the risk of fraudulent revenue     recognition
Potential fraud risks that had been identified throughout the planning and commencement of the audit were communicated to the audit team. 
The inherent limitations of audit present an unavoidable risk that we, the auditors, may not have detected some material misstatements within the financial statements despite proper planning and performance of our duties as auditors. Equally, there remains a risk of the non-detection of fraud which could involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls. The audit procedures carried out are designed to detect material misstatements within the financial statements, and as such we take no responsibility for preventing non-compliance or fraud and cannot be expected to detect non-compliance with all laws and regulations.


A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditors' report.


Page 6

 
HUNN GROUP LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF HUNN GROUP LIMITED (CONTINUED)





Dean Osborne (Senior statutory auditor)
  
for and on behalf of
Clay Ratnage Daffin & Co Limited
 
Chartered Accountants
Statutory Auditors
  
Suite D, The Business Centre
Faringdon Avenue
Romford
Essex
RM3 8EN

26 July 2024
Page 7

 
HUNN GROUP LIMITED
 
 
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023

2023
2022
Note
£
£

  

Turnover
 4 
21,380,055
7,377,918

Cost of sales
  
(15,290,940)
(5,189,061)

Gross profit
  
6,089,115
2,188,857

Administrative expenses
  
(5,388,377)
(1,709,430)

Other operating income
 5 
1,430
945

Operating profit
 6 
702,168
480,372

Interest receivable and similar income
 10 
25,492
3,447

Interest payable and similar expenses
 11 
(37,839)
(8,392)

Profit before taxation
  
689,821
475,427

Tax on profit
 12 
(237,420)
(107,463)

Profit for the financial year
  
452,401
367,964

Profit for the year attributable to:
  

Non-controlling interests
  
174,358
112,995

Owners of the parent Company
  
278,043
254,969

  
452,401
367,964

There were no recognised gains and losses for 2023 or 2022 other than those included in the consolidated statement of comprehensive income.

There was no other comprehensive income for 2023 (2022:£NIL).

The notes on pages 17 to 36 form part of these financial statements.

Page 8

 
HUNN GROUP LIMITED
REGISTERED NUMBER: 13312061

CONSOLIDATED BALANCE SHEET
AS AT 31 DECEMBER 2023

2023
2022
Note
£
£

Fixed assets
  

Intangible assets
 14 
2,838,707
3,166,250

Tangible assets
 15 
6,034,396
5,909,613

Investment property
 17 
1,127,728
1,127,728

  
10,000,831
10,203,591

Current assets
  

Stocks
 18 
894,526
1,234,375

Debtors: amounts falling due within one year
 19 
788,907
943,319

Cash at bank and in hand
 20 
1,057,575
882,262

  
2,741,008
3,059,956

Creditors: amounts falling due within one year
 21 
(11,548,617)
(12,552,620)

Net current liabilities
  
 
 
(8,807,609)
 
 
(9,492,664)

Total assets less current liabilities
  
1,193,222
710,927

Creditors: amounts falling due after more than one year
 22 
(91,479)
-

Provisions for liabilities
  

Deferred taxation
 24 
(487,844)
(392,129)

Net assets
  
613,899
318,798


Capital and reserves
  

Called up share capital 
 25 
100
100

Profit and loss account
 26 
534,421
256,378

Equity attributable to owners of the parent Company
  
534,521
256,478

Non-controlling interests
  
79,378
62,320

  
613,899
318,798


Page 9

 
HUNN GROUP LIMITED
REGISTERED NUMBER: 13312061
    
CONSOLIDATED BALANCE SHEET (CONTINUED)
AS AT 31 DECEMBER 2023

The financial statements were approved and authorised for issue by the board and were signed on its behalf on 26 July 2024.






D Hunn
Director

The notes on pages 17 to 36 form part of these financial statements.

Page 10

 
HUNN GROUP LIMITED
REGISTERED NUMBER: 13312061

COMPANY BALANCE SHEET
AS AT 31 DECEMBER 2023

2023
2022
Note
£
£

Fixed assets
  

Investments
 16 
4,924,500
4,924,500

Investment Property
 17 
4,741,831
4,741,831

  
9,666,331
9,666,331

Current assets
  

Debtors: amounts falling due within one year
 19 
968
1,812

Cash at bank and in hand
 20 
3,191
5,623

  
4,159
7,435

Creditors: amounts falling due within one year
 21 
(9,166,863)
(9,252,650)

Net current liabilities
  
 
 
(9,162,704)
 
 
(9,245,215)

Total assets less current liabilities
  
503,627
421,116

  

Provisions for liabilities
  

Deferred taxation
 24 
(98,611)
(98,611)

Net assets
  
405,016
322,505


Capital and reserves
  

Called up share capital 
 25 
100
100

Non-distributable profit reserves
 26 
295,831
295,831

Profit and loss account
 26 
109,085
26,574

  
405,016
322,505


The financial statements were approved and authorised for issue by the board and were signed on its behalf on 26 July 2024.






D Hunn
Director

The notes on pages 17 to 36 form part of these financial statements.

Page 11

 

 
HUNN GROUP LIMITED


 

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023



Called up share capital
Profit and loss account
Equity attributable to owners of parent Company
Non-controlling interests
Total equity


£
£
£
£
£



At 1 January 2022
100
1,409
1,509
-
1,509



Comprehensive income for the year


Profit for the year
-
254,969
254,969
113,020
367,989


Dividends: Equity capital
-
-
-
(50,700)
(50,700)





At 1 January 2023
100
256,378
256,478
62,320
318,798



Comprehensive income for the year


Profit for the year
-
278,043
278,043
174,358
452,401


Dividends: Equity capital
-
-
-
(157,300)
(157,300)



At 31 December 2023
100
534,421
534,521
79,378
613,899



The notes on pages 17 to 36 form part of these financial statements.

Page 12

 

 
HUNN GROUP LIMITED


 

COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023



Called up share capital
Non-distributable profit reserves
Profit and loss account
Total equity


£
£
£
£



At 1 January 2022
100
-
1,409
1,509



Comprehensive income for the year


Profit for the year
-
-
320,996
320,996


Transfer to/from profit and loss account
-
295,831
(295,831)
-





At 1 January 2023
100
295,831
26,574
322,505



Comprehensive income for the year


Profit for the year
-
-
82,511
82,511



At 31 December 2023
100
295,831
109,085
405,016



The notes on pages 17 to 36 form part of these financial statements.

Page 13

 
HUNN GROUP LIMITED
 

CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023

2023
2022
£
£

Cash flows from operating activities

Profit for the financial year
452,401
367,964

Adjustments for:

Amortisation of intangible assets
327,543
109,181

Depreciation of tangible assets
911,846
312,511

Loss on disposal of tangible assets
(32,073)
(433)

Interest paid
37,839
8,392

Interest received
(25,492)
(3,447)

Taxation charge
237,420
107,463

Decrease/(increase) in stocks
339,849
(1,234,375)

Decrease/(increase) in debtors
154,412
(940,334)

Increase in amounts owed by associated companies
-
(2,985)

Decrease in creditors
(557,931)
921,071

Corporation tax paid
(203,950)
(623,713)

Net cash generated from operating activities

1,641,864
(978,705)


Cash flows from investing activities

Purchase of intangible fixed assets
-
(3,275,431)

Purchase of tangible fixed assets
(1,107,316)
(143,790)

Sale of tangible fixed assets
102,760
1,500

Purchase of investment properties
-
(3,627,189)

Purchase of fixed asset investments
-
(1,502,470)

Interest received
25,492
3,447

HP interest paid
(11,880)
(2,418)

Net cash from investing activities

(990,944)
(8,546,351)
Page 14

 
HUNN GROUP LIMITED
 

CONSOLIDATED STATEMENT OF CASH FLOWS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023


2023
2022

£
£



Cash flows from financing activities

New finance leases
297,000
-

Repayment of finance leases
(266,735)
(75,537)

Loans from directors
-
808,311

New loans from associates
-
9,329,006

Interest paid
(25,959)
(5,974)

Dividends paid to non-controlling interests
(157,300)
(50,675)

Net cash used in financing activities
(152,994)
10,005,131

Net increase in cash and cash equivalents
497,926
480,075

Cash and cash equivalents at beginning of year
484,275
4,200

Cash and cash equivalents at the end of year
982,201
484,275


Cash and cash equivalents at the end of year comprise:

Cash at bank and in hand
1,057,575
882,262

Bank overdrafts
(75,374)
(397,987)

982,201
484,275


The notes on pages 17 to 36 form part of these financial statements.

Page 15

 
HUNN GROUP LIMITED
 

CONSOLIDATED ANALYSIS OF NET DEBT
FOR THE YEAR ENDED 31 DECEMBER 2023





At 1 January 2023
Cash flows
New finance leases
At 31 December 2023
£

£

£

£

Cash at bank and in hand

882,262

175,313

-

1,057,575

Bank overdrafts

(397,987)

322,613

-

(75,374)

Debt due within 1 year

(1,498,311)

870,178

-

(628,133)

Finance leases

(208,735)

266,735

(297,000)

(239,000)


(1,222,771)
1,634,839
(297,000)
115,068

The notes on pages 17 to 36 form part of these financial statements.

Page 16

 
HUNN GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

1.


General information

Hunn Group Limited is a private company limited by shares, incorporated in England, United Kingdom. The address of the registered office is Suite D, The Business Centre, Faringdon Avenue, Romford, Essex, RM3 8EN. The principal place of business is 2a Landau Way, Erith, DA8 2LF.

2.Accounting policies

 
2.1

Basis of preparation of financial statements

The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.

The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires Group management to exercise judgment in applying the Group's accounting policies (see note 3).

The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of comprehensive income in these financial statements.

The following principal accounting policies have been applied:

 
2.2

Basis of consolidation

The consolidated financial statements present the results of the Company and its own subsidiaries ("the Group") as if they form a single entity. Intercompany transactions and balances between group companies are therefore eliminated in full.
The consolidated financial statements incorporate the results of business combinations using the purchase method. In the Balance sheet, the acquiree's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquired operations are included in the Consolidated statement of comprehensive income from the date on which control is obtained. They are deconsolidated from the date control ceases.

Page 17

 
HUNN GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.3

Revenue

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group 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:
the Group has transferred the significant risks and rewards of ownership to the buyer;
the Group retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;
the amount of revenue can be measured reliably;
it is probable that the Group will receive the consideration due under the transaction; and
the costs incurred or to be incurred in respect of the transaction can be measured reliably.

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:
the amount of revenue can be measured reliably;
it is probable that the Group will receive the consideration due under the contract;
the stage of completion of the contract at the end of the reporting period can be measured reliably; and
the costs incurred and the costs to complete the contract can be measured reliably.

 
2.4

Operating leases: the Group as lessee

Rentals paid under operating leases are charged to profit or loss on a straight-line basis over the lease term.

Benefits received and receivable as an incentive to sign an operating lease are recognised on a straight-line basis over the lease term, unless another systematic basis is representative of the time pattern of the lessee's benefit from the use of the leased asset.

 
2.5

Interest income

Interest income is recognised in profit or loss using the effective interest method.

 
2.6

Finance costs

Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.

Page 18

 
HUNN GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.7

Borrowing costs

All borrowing costs are recognised in profit or loss in the year in which they are incurred.

 
2.8

Pensions

Defined contribution pension plan

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

The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Balance sheet. The assets of the plan are held separately from the Group in independently administered funds.

 
2.9

Current and deferred taxation

The tax expense for the year comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.

The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the balance sheet date in the countries where the Company and the Group operate and generate income.

Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the balance sheet date, except that:
The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits;
Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met; and
Where they relate to timing differences in respect of interests in subsidiaries, associates, branches and joint ventures and the Group can control the reversal of the timing differences and such reversal is not considered probable in the foreseeable future.

Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

Page 19

 
HUNN GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.10

Intangible assets

Goodwill

Goodwill represents the difference between amounts paid on the cost of a business combination and the acquirer’s interest in the fair value of the Group's share of its identifiable assets and liabilities of the acquiree at the date of acquisition. Subsequent to initial recognition, goodwill is measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is amortised on a straight-line basis to the Consolidated statement of comprehensive income over its useful economic life.


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 ten years.

 The estimated useful lives range as follows:

Goodwill
-
10
years

 
2.11

Tangible fixed assets

Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated 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.

Investment property rented to other group entities and accounted for under the cost model is stated at historical cost less accumulated depreciation and any accumulated impairment losses.

At each reporting date the Group assesses whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined which is the higher of its fair value less costs to sell and its value in use. An impairment loss is recognised where the carrying amount exceeds the recoverable amount.

The Group adds to the carrying amount of an item of fixed assets the cost of replacing part of such an item when that cost is incurred, if the replacement part is expected to provide incremental future benefits to the Group. The carrying amount of the replaced part is derecognised. Repairs and maintenance are charged to profit or loss during the period in which they are incurred.

Page 20

 
HUNN GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)


2.11
Tangible fixed assets (continued)

Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, on a reducing balance basis.

Depreciation is provided on the following basis:

Freehold property
-
No depreciation
Plant and machinery
-
25%
Motor vehicles
-
25%
Furniture, fittings and equipment
-
25%
Property
-
15 years straight line

The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.

 
2.12

Investment property

Investment property is carried at fair value determined annually by the directors and derived from the current market rents and investment property yields for comparable real estate, adjusted if necessary for any difference in the nature, location or condition of the specific asset. No depreciation is provided. Changes in fair value are recognised in profit or loss.

 
2.13

Valuation of investments

Investments in subsidiaries are measured at cost less accumulated impairment.

 
2.14

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 selling price less margin to account for the cost of processing materials as well as the purchase price.



 
2.15

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.

Page 21

 
HUNN GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.16

Cash and cash equivalents

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.

In the Consolidated statement of cash flows, cash and cash equivalents are shown net of bank overdrafts that are repayable on demand and form an integral part of the Group's cash management.

 
2.17

Creditors

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

 
2.18

Provisions for liabilities

Provisions are recognised when an event has taken place that gives rise to a legal or constructive obligation, a transfer of economic benefits is probable and a reliable estimate can be made.
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.
 
Increases in provisions are generally charged as an expense to profit or loss.

 
2.19

Financial instruments

The Group 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 Group's Balance sheet when the Group becomes party to the contractual provisions of the instrument.

Basic financial assets

Basic financial assets, which include trade and other receivables, cash and bank balances, are initially measured at their transaction price including transaction costs and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, 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.

Discounting is omitted where the effect of discounting is immaterial. The Group's cash and cash equivalents, trade and most other receivables due with the operating cycle fall into this category of financial instruments.

Financial liabilities

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instruments any contract that evidences a residual interest in the assets of the Group after the deduction of all its liabilities.

Basic financial liabilities, which include trade and other payables, bank loans, other loans and loans due to fellow group companies are initially measured at their transaction price after transaction costs. When this
Page 22

 
HUNN GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)


2.19
Financial instruments (continued)

constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Discounting is omitted where the effect of discounting is immaterial.

Debt instruments are subsequently carried at their amortised cost using the effective interest rate method.

Trade payables are obligations to pay for goods and services that have been acquired in the ordinary course of business from suppliers. Trade payables are classified as current liabilities if the payment is due within one year. If not, they represent non-current liabilities. Trade payables are initially recognised at their transaction price and subsequently are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial.


3.


Judgments in applying accounting policies and key sources of estimation uncertainty

The directors have made key assumptions regarding the value of investment properties, value of closing stock, depreciation rate of fixed assets and amortisation of goodwill.  The total value of investment properties at the year end is £1,127,728 (2022 - £1,127,728) based on open market value for existing use.  The estimated value of closing stock at the year end is £894,526 (2022 - £1,234,375).


4.


Turnover

An analysis of turnover by class of business is as follows:


2023
2022
£
£

Sale of goods
21,378,231
7,374,694

Rent receivable
1,824
3,224

21,380,055
7,377,918


Analysis of turnover by country of destination:

2023
2022
£
£

United Kingdom
16,518,777
5,662,259

Rest of Europe
78,155
17,237

Rest of the world
4,783,123
1,698,422

21,380,055
7,377,918


Page 23

 
HUNN GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

5.


Other operating income

2023
2022
£
£

Plant hire
1,430
945



6.


Operating profit

The operating profit is stated after charging:

2023
2022
£
£

Other operating lease rentals
18,225
3,943


7.


Auditors' remuneration

During the year, the Group obtained the following services from the Company's auditors:


2023
2022
£
£

Fees payable to the Company's auditors for the audit of the consolidated and parent Company's financial statements
14,500
4,567

Fees payable to the Company's auditors in respect of:

Non-audit services
16,835
17,863

Page 24

 
HUNN GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

8.


Employees

Staff costs, including directors' remuneration, were as follows:


Group
Group
2023
2022
£
£


Wages and salaries
1,752,009
548,888

Social security costs
151,313
49,961

Cost of defined contribution scheme
33,203
10,672

1,936,525
609,521


The average monthly number of employees, including the directors, during the year was as follows:



Group
Group
Company
Company
        2023
        2022
        2023
        2022
            No.
            No.
            No.
            No.









Directors
3
3
3
3



Admin
6
2
-
-



Staff
48
17
-
-

57
22
3
3


9.


Directors' remuneration

2023
2022
£
£

Directors' emoluments
14,266
4,433



10.


Interest receivable

2023
2022
£
£


Other interest receivable
25,492
3,447

Page 25

 
HUNN GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

11.


Interest payable and similar expenses

2023
2022
£
£


Bank interest payable
25,959
5,974

Finance leases and hire purchase contracts
11,880
2,418

37,839
8,392

Page 26

 
HUNN GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

12.


Taxation


2023
2022
£
£

Corporation tax


Current tax on profits for the year
141,705
130,475


Deferred tax


Origination and reversal of timing differences
95,715
(23,012)


Taxation on profit on ordinary activities
237,420
107,463

Factors affecting tax charge for the year

The tax assessed for the year is higher than (2022 - higher than) the standard rate of corporation tax in the UK of 25% (2022 - 19%). The differences are explained below:

2023
2022
£
£


Profit on ordinary activities before tax
689,821
475,427


Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 25% (2022 - 19%)
172,455
90,331


Non-tax deductible amortisation of goodwill and impairment
81,886
20,744

Expenses not deductible for tax purposes, other than goodwill amortisation and impairment
110
2,700

Capital allowance in the year (in excess)/ less than depreciation
(108,874)
16,700

Increase in pension fund prepayment leading to an increase in tax
42
-

Change in tax rate leading to a decrease in tax
(8,913)
-

Capital gains
4,999
-

Deferred tax timing differences leading to an increase/(decrease) in the tax charge
95,715
(23,012)

Total tax charge for the year
237,420
107,463


Factors that may affect future tax charges

There were no factors that may affect future tax charges.


13.


Parent company profit for the year

The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of comprehensive income in these financial statements. The profit after tax of the parent Company for the year was £82,511 (2022 - £320,996).

Page 27

 
HUNN GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

14.


Intangible assets

Group





Goodwill

£



Cost


At 1 January 2023
3,275,431



At 31 December 2023

3,275,431



Amortisation


At 1 January 2023
109,181


Charge for the year on owned assets
327,543



At 31 December 2023

436,724



Net book value



At 31 December 2023
2,838,707



At 31 December 2022
3,166,250



Page 28

 
HUNN GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

15.


Tangible fixed assets

Group






Freehold property
Plant and machinery
Motor
 vehicles
Furniture, fittings and equipment
Property
Total

£
£
£
£
£
£



Cost or valuation


At 1 January 2023
3,219,661
2,076,472
703,266
86,185
131,607
6,217,191


Additions
-
660,511
428,839
17,966
-
1,107,316


Disposals
-
(12,630)
(69,578)
-
-
(82,208)



At 31 December 2023

3,219,661
2,724,353
1,062,527
104,151
131,607
7,242,299



Depreciation


At 1 January 2023
-
218,351
76,527
8,686
4,014
307,578


Charge for the year on owned assets
-
543,856
249,071
23,878
12,041
828,846


Charge for the year on financed assets
-
83,000
-
-
-
83,000


Disposals
-
(1,263)
(10,258)
-
-
(11,521)



At 31 December 2023

-
843,944
315,340
32,564
16,055
1,207,903



Net book value



At 31 December 2023
3,219,661
1,880,409
747,187
71,587
115,552
6,034,396



At 31 December 2022
3,219,661
1,858,121
626,739
77,499
127,593
5,909,613

The net book value of assets held under finance leases or hire purchase contracts, included above, are as follows:


2023
2022
£
£



Plant and machinery
249,000
290,812

Page 29

 
HUNN GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

16.


Fixed asset investments

Company





Investments in subsidiary companies

£



Cost or valuation


At 1 January 2023
4,924,500



At 31 December 2023
4,924,500





Subsidiary undertaking


The following was a subsidiary undertaking of the Company:

Name

Registered office

Class of shares

Holding

Scrapco Metal Recycling Limited
Suite D, The Business Centre, Faringdon Avenue, Romford, Essex, RM3 8EN
Ordinary
75%

The aggregate of the share capital and reserves as at 31 December 2023 and the profit or loss for the year ended on that date for the subsidiary undertaking were as follows:

Name
Aggregate of share capital and reserves
Profit/(Loss)

Scrapco Metal Recycling Limited
2,590,507
697,433

Page 30

 
HUNN GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

17.


Investment property

Group


Freehold investment property

£



Valuation


At 1 January 2023
1,127,728



At 31 December 2023
1,127,728

The 2023 valuations were made by the directors', on an open market value for existing use basis.





If the Investment properties had been accounted for under the historic cost accounting rules, the properties would have been measured as follows:

2023
2022
£
£


Historic cost
1,127,728
1,127,728

Company





Freehold investment property

£



Valuation


At 1 January 2023
4,741,831



At 31 December 2023
4,741,831

The 2023 valuations were made by the directors', on an open market value for existing use basis.



18.


Stocks

Group
Group
2023
2022
£
£

Raw materials and consumables
894,526
1,234,375


Page 31

 
HUNN GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

19.


Debtors

Group
Group
Company
Company
2023
2022
2023
2022
£
£
£
£


Trade debtors
572,012
735,014
-
-

Amounts owed by joint ventures and associated undertakings
2,985
2,985
-
-

Other debtors
72,841
98,122
-
-

Prepayments and accrued income
141,069
107,198
968
1,812

788,907
943,319
968
1,812



20.


Cash and cash equivalents

Group
Group
Company
Company
2023
2022
2023
2022
£
£
£
£

Cash at bank and in hand
1,057,575
882,262
3,191
5,623

Less: bank overdrafts
(75,374)
(397,987)
-
-

982,201
484,275
3,191
5,623



21.


Creditors: Amounts falling due within one year

Group
Group
Company
Company
2023
2022
2023
2022
£
£
£
£

Bank overdrafts
75,374
397,987
-
-

Trade creditors
346,148
454,184
1,471
251

Amounts owed to group undertakings
-
-
1,587,166
837,637

Corporation tax
102,705
164,950
25,375
6,571

Other taxation and social security
858,943
420,371
-
-

Obligations under finance lease and hire purchase contracts
147,521
208,735
-
-

Other creditors
9,981,871
10,867,902
7,549,571
8,405,100

Accruals and deferred income
36,055
38,491
3,280
3,091

11,548,617
12,552,620
9,166,863
9,252,650


Page 32

 
HUNN GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

22.


Creditors: Amounts falling due after more than one year

Group
Group
2023
2022
£
£

Net obligations under finance leases and hire purchase contracts
91,479
-



23.


Hire purchase and finance leases


Minimum lease payments under hire purchase fall due as follows:

Group
Group
2023
2022
£
£

Within one year
147,521
208,735

Between 1-5 years
91,479
-

239,000
208,735

Page 33

 
HUNN GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

24.


Deferred taxation


Group



2023


£






At beginning of year
(392,129)


Charged to profit or loss
(95,715)



At end of year
(487,844)

Company


2023


£






At beginning of year
(98,611)



At end of year
(98,611)

The provision for deferred taxation is made up as follows:

Group
Group
Company
Company
2023
2022
2023
2022
£
£
£
£

Accelerated capital allowances
(487,844)
(392,129)
-
-

Investment property revaluation
-
-
(98,611)
(98,611)

(487,844)
(392,129)
(98,611)
(98,611)


The directors expect the reversal of £135,217 of the deferred taxation liability in the year after the reporting period as the assets are depreciated.

Page 34

 
HUNN GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

25.


Share capital

2023
2022
£
£
Allotted, called up and fully paid



1 (2022 - 1) Ordinary A share of £1.00
1
1
50 (2022 - 50) Ordinary B shares of £1.00 each
50
50
49 (2022 - 49) Ordinary C shares of £1.00 each
49
49

100

100

Ordinary A, B & C shares have equal voting rights but independent dividend rights.



26.


Reserves

Non-distributable profit reserves

Non-distributable profit reserves relating to the unrealised gain or loss on fair value adjustment of investment properties. Deferred tax has been provided on the revaluation of investment properties.

Profit and loss account

Includes all current and prior period retained profits and losses.


27.


Pension commitments

The Group operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the Group in an independently administered fund. The pension cost charge represents contributions payable by the Group to the fund and amounted to £33,203 (2022 - £10,672). Contributions totalling £6,668 (2022 - £6,274) were payable to the fund at the balance sheet date and are included in creditors.


28.


Commitments under operating leases

At 31 December 2023 the Group and the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:


Group
Group
2023
2022
£
£

Not later than 1 year
7,171
15,771

Later than 1 year and not later than 5 years
14,342
25,814

21,513
41,585
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HUNN GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

29.


Related party transactions


2023
2022
£
£

Amounts due to associated companies
9,326,648
9,359,106
Amounts due from associated companies
53,033
53,033
Key management personnel compensation
14,266
11,083
Shares purchased from an associated company
-
4,900,000
Property purchased from an associated company
-
975,000
Property purchased from directors
-
2,235,000
Sales to associated companies
67,442
19,060
Purchases from associated companies
148,004
57,511
9,609,393
17,609,793

All transactions with related parties have been conducted at market value on an arms length basis.
Loans between related parties are unsecured and interest free.
There is a personal guarantee given by Mr R G Hunn, a director and shareholder, to the value of £600,000 for the benefit of the bank.

 
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