GARDX INTERNATIONAL LIMITED
COMPANY INFORMATION
Directors
Mr V A Coutin
Mr V L Coutin
Mr S Tyre
(Appointed 11 April 2023)
Company number
05465377
Registered office
Lake House
2 Port Way
Port Solent
Portsmouth
PO6 4TY
Auditor
Sumer Audit
Amelia House
Crescent Road
Worthing
West Sussex
BN11 1RL
GARDX INTERNATIONAL LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2 - 3
Directors' responsibilities statement
4
Independent auditor's report
5 - 7
Statement of comprehensive income
8
Statement of financial position
9
Statement of changes in equity
10
Notes to the financial statements
11 - 25
GARDX INTERNATIONAL LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MAY 2023
The directors present the strategic report for the year ended 31 May 2023.
Review of the business
The company operates within the automotive industry providing a diverse range of products which are sold business to business. Our primary focus is vehicle protection products and digital marketing solutions.
The directors are pleased to report the increase in turnover for the year which has been the main area of focus for the company during the year. We acknowledge that the company has made a loss in the current year, however, this is largely due to planned increases in operational costs to support the development of longer-term growth strategies.
To provide context to the financial results of Gardx International Ltd. one must also consider the performance, and profit made, in the same reporting period of Gardx’s insurance company Gardx Assure Ltd. All resources and costs are shared across both Gardx International Limited and Gardx Assure Limited. For this reason, since the year end, Gardx Assure has been brought into the Holdings group structure enabling a more meaningful statement of the Gardx Group performance to be produced.
Principal risks and uncertainties
The company operates in an extremely competitive environment with a number of competitors offering vehicle protection products. By developing our existing vehicle protection range, investing in our world-class technology solutions and having a collaborative and growth-focused approach with our partners, the directors believe that this differentiates us from our competitors.
Economic uncertainty and the cost of living crisis, have contributed to uncertainty in the Automotive industry posing a risk to the volumes of car sales. The directors believe that the business' market-leading approach to working with and providing technology solutions to our customers will maximise the sales opportunities and allow us to offset this risk.
The company is exposed to fluctuations in global currencies, particularly movements in the pound Sterling against the US Dollar and the Euro. In the current financial year, the company has not used forward currency contracts, however, since the year end the company now have a hedging facility in place to mitigate any future risk.
Key performance indicators
The directors have been focused on investing in future growth engines whilst transforming core business operations. Currently, the most important KPI for the business is its turnover growth.
Turnover for the year was £15,145,440 (2022: £13,848,626), an increase of 9.4%.
Mr V A Coutin
Director
6 August 2024
- 1 -
GARDX INTERNATIONAL LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MAY 2023
The directors present their annual report and financial statements for the year ended 31 May 2023.
Principal activities
The principal activity of the company continued to be that of operating within the automotive industry, focused on providing a diverse range of vehicle protection products and digital marketing solutions.
Results and dividends
The results for the year are set out on page 8.
Ordinary dividends were paid amounting to £500,000. The directors do not recommend payment of a further dividend.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
Mr V A Coutin
Mr V L Coutin
Mr S Tyre
(Appointed 11 April 2023)
Financial instruments
Liquidity risk
The company manages its cash and borrowing requirements in order to maximise interest income and minimise interest expense, whilst ensuring the company has sufficient liquid resources to meet the operating needs of the business.
Credit risk
Investments of cash surpluses are made through banks and companies which must fulfil credit rating criteria approved by the Board.
Future developments
The directors believe that there are no future developments that require disclosure.
Auditor
Sumer Audit were appointed as auditor to the company and in accordance with section 485 of the Companies Act 2006, a resolution proposing that they be re-appointed will be put at a General Meeting.
Statement of disclosure to auditor
So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.
Medium-sized companies exemption
This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.
- 2 -
GARDX INTERNATIONAL LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
On behalf of the board
Mr V A Coutin
Director
6 August 2024
- 3 -
GARDX INTERNATIONAL LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 MAY 2023
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;
state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;
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.
- 4 -
GARDX INTERNATIONAL LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF GARDX INTERNATIONAL LIMITED
Opinion
- 5 -
We have audited the financial statements of Gardx International Limited (the 'company') for the year ended 31 May 2023 which comprise the statement of comprehensive income, the statement of financial position, the statement of changes in equity 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 May 2023 and of its loss 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.
GARDX INTERNATIONAL LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBER OF GARDX INTERNATIONAL LIMITED
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.
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.
In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, our procedures included the following:
Obtaining an understanding of the legal and regulatory framework that the company operates in, focusing on those laws and regulations that had a direct effect on the financial statements and operations;
Obtaining an understanding of the company's policies and procedures on fraud risks, including knowledge of any actual, suspected or alleged fraud; and
Discussing among the engagement team how and where fraud might occur in the financial statements and any potential indicators of fraud through our knowledge and understanding of the company and our sector-specific experience.
As a result of these procedures, we considered the opportunities and incentives that may exist within the company for fraud. We are also required to perform specific procedures to respond to the risk of management override. As a result of performing the above, we identified the following areas as those most likely to have an impact on the financial statements: health and safety, employment law and compliance with the UK Companies Act.
- 6 -
GARDX INTERNATIONAL LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBER OF GARDX INTERNATIONAL LIMITED
In addition to the above, our procedures to respond to risks identified included the following:
Making enquiries of management about any known or suspected instances of non-compliance with laws and regulations and fraud;
Challenging assumptions and judgements made by management in their significant accounting estimates; and
Auditing the risk of management override of controls, including through testing journal entries and other adjustments for appropriateness.
Due to the inherent limitations of an audit, there is an unavoidable risk that some material misstatements in the financial statements may not be detected, even though the audit is properly planned and performed in accordance with the ISAs (UK). For instance, the further removed non-compliance is from the events and transactions reflected in the financial statements, the less likely the auditor is to become aware of it or to
recognise the non-compliance.
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 member 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 member those matters we are required to state to the member 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 member, for our audit work, for this report, or for the opinions we have formed.
Christopher Reeves ACA FCCA (Senior Statutory Auditor)
For and on behalf of Sumer Audit
6 August 2024
Chartered Accountants
Statutory Auditor
Worthing
Sumer Audit is a trading name of Sumer Auditco Limited
- 7 -
GARDX INTERNATIONAL LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MAY 2023
2023
2022
Notes
£
£
Revenue
3
15,145,440
13,848,626
Cost of sales
(10,052,625)
(9,118,836)
Gross profit
5,092,815
4,729,790
Administrative expenses
(6,682,285)
(5,025,681)
Other operating income
98,278
9,175
Operating loss
4
(1,491,192)
(286,716)
Investment income
19,964
Finance costs
7
(142,146)
(92,404)
Loss before taxation
(1,613,374)
(379,120)
Tax on loss
8
254,121
103,778
Loss for the financial year
(1,359,253)
(275,342)
The income statement has been prepared on the basis that all operations are continuing operations.
- 8 -
GARDX INTERNATIONAL LIMITED
STATEMENT OF FINANCIAL POSITION
2023
2022
Notes
£
£
£
£
Non-current assets
Intangible assets
10
527,615
351,682
Property, plant and equipment
11
723,665
677,373
Investment property
12
395,000
395,000
Investments
13
184,506
40,006
1,830,786
1,464,061
Current assets
Inventories
14
1,813,613
1,580,405
Trade and other receivables
15
8,630,601
8,578,337
Cash and cash equivalents
70,999
1,340,411
10,515,213
11,499,153
Current liabilities
16
(8,353,766)
(7,342,875)
Net current assets
2,161,447
4,156,278
Total assets less current liabilities
3,992,233
5,620,339
Non-current liabilities
17
(1,437,752)
(2,087,433)
Provisions for liabilities
Provisions
19
2,187,659
1,324,410
Deferred tax liability
20
91,100
73,521
(2,278,759)
(1,397,931)
Net assets
275,722
2,134,975
Equity
Called up share capital
22
100
100
Retained earnings
275,622
2,134,875
Total equity
275,722
2,134,975
These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.
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:
Mr V A Coutin
Director
Company registration number 05465377 (England and Wales)
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GARDX INTERNATIONAL LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MAY 2023
Share capital
Retained earnings
Total
Notes
£
£
£
Balance at 1 June 2021
100
2,410,217
2,410,317
Year ended 31 May 2022:
Loss and total comprehensive income
-
(275,342)
(275,342)
Balance at 31 May 2022
100
2,134,875
2,134,975
Year ended 31 May 2023:
Loss and total comprehensive income
-
(1,359,253)
(1,359,253)
Dividends
9
-
(500,000)
(500,000)
Balance at 31 May 2023
100
275,622
275,722
- 10 -
GARDX INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2023
1
Accounting policies
Company information
Gardx International Limited is a private company limited by shares incorporated in England and Wales. The registered office is Lake House, 2 Port Way, Port Solent, Portsmouth, PO6 4TY.
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 £1.
The financial statements have been prepared under the historical cost convention, modified to include to include investment properties at fair value. The principal accounting policies adopted are set out below.
This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements:
1.2
Going concern
To provide context to the financial results of Gardx International Ltd. one must also consider the performance, and profit made, in the same reporting period of Gardx’s insurance company Gardx Assure Ltd. All resources and costs are shared across both Gardx International Limited and Gardx Assure Limited. For this reason, since the year end, Gardx Assure has been brought into the Holdings group structure enabling a more meaningful statement of the Gardx Group performance to be produced.true Gardx International Ltd incurred a large loss for the year and reduction in working capital due to some market constraints as well as significant planned investments for future growth. The directors closely monitor business performance and cash flow and since the period end have made a number of changes to reduce costs. Since the period end the company has also secured an invoice financing facility of £1.5m as part of the directors plans to stabilise the business and return to profitability and the directors are therefore confident there are no material uncertainties relating to going concern.
At 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. The directors have considered relevant information, including the company’s principal risks and uncertainties, the annual budget, forecast future cash flows and the impact of subsequent events in making their assessment. Based on these assessments and having regard to the resources available to the entity, the directors have concluded that there is no material uncertainty and that they can continue to adopt the going concern basis in preparing the annual report and financial statements.
1.3
Revenue
- 11 -
Revenue is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.
GARDX INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
1
Accounting policies
(Continued)
- 12 -
Revenue from contracts for the rendering of services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that it is probable will be recovered.
1.4
Intangible fixed assets other than goodwill
Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.
Amortisation 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:
Trade mark
10 years straight line per annum
Website
10 years straight line per annum, once website live
1.5
Property, plant and equipment
Property, plant and equipment are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Freehold land and buildings
2% straight line
Improvements to property
10% straight line
Fixtures and fittings
15% diminishing balance
Computers
33% straight line
Motor vehicles
20% diminishing 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.
1.6
Investment properties
Investment property, which is property held to earn rentals and/or for capital appreciation, is initially recognised at cost, which includes the purchase cost and any directly attributable expenditure. Subsequently it is measured at fair value at the reporting end date. Changes in fair value are recognised in profit or loss.
1.7
Impairment of non-current assets
At each reporting period end date, the company reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any).
1.8
Inventories
Inventories are stated at the lower of cost and estimated selling price less costs to complete and sell, after making due allowance for obsolete and slow moving items.
1.9
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include deposits held at call with banks and bank overdrafts.
GARDX INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
1
Accounting policies
(Continued)
1.10
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's statement of financial position 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.
The company enters into basic financial instruments transactions that result in the recognition of financial assets and liabilities like trade and other receivables and payables and loans from fellow group undertakings.
Debt instruments like loans from fellow group undertakings and other receivables and payables 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 receipts discounted at a market rate of interest. Debt instruments that are payable or receivable within one year are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received.
1.11
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.
1.12
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year.
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. Any deferred tax balance is not discounted.
1.13
Provisions
Provisions are recognised when the company has a legal or constructive present obligation as a result of a past event, it is probable that the company will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.
The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the reporting end date, taking into account the risks and uncertainties surrounding the obligation. Where the effect of the time value of money is material, the amount expected to be required to settle the obligation is recognised at present value.
1.14
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense.
1.15
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
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GARDX INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
1
Accounting policies
(Continued)
1.16
Leases
Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.
1.17
Government grants
Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.
1.18
Foreign exchange
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.
2
Judgements and key sources of estimation uncertainty
In the application of the 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.
Critical judgements
The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.
Recoverability of intercompany and connected company debtors
The directors carried out a review of the amounts that they consider will be recoverable in respect of debts due from fellow group undertakings and connected companies. Unless the directors considered that there was a strong likelihood that the debts would be recovered from the related parties (either in part of in full), provision has been made for the amounts due.
Car maintenance & tyre and wheel alloy plans
Included within the sale of goods in revenue is the sale of Car Maintenance plans and Tyre and Wheel alloy plans. These are a product that are sold to third-party main dealers who then provide this service to the retail customers. Amounts expected to be incurred for future liabilities and warranty claims are included in provisions.
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GARDX INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
2
Judgements and key sources of estimation uncertainty
(Continued)
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.
Investment property
The directors believe that the fair value of the investment property in the financial statements is £395,000 (2022: £395,000). This valuation is based on a professional valuation undertaken on 10 February 2022, taking into account any movements in property values in the local area since the last valuation date.
CMP provision
The provision for the CMP repair fund costs has been based on actual costs incurred so far on maintenance plans that have been sold to date taking into account expected future patterns of behavior and the professional estimation provided by Lloyds underwriters. The amount included in provisions in relation to the CMP repair fund is £2,187,659 (2022: £1,324,411).
3
Revenue
2023
2022
£
£
Revenue analysed by class of business
Sale of goods
15,145,440
13,848,626
2023
2022
£
£
Other revenue
Interest income
19,964
-
Grants received
-
9,175
2023
2022
£
£
Revenue analysed by geographical market
UK and Ireland
12,407,876
11,869,521
Europe
590,596
228,493
South America
1,000,085
512,991
Middle East
478,763
587,775
Australia and New Zealand
614,832
386,422
Rest of the world
53,288
263,424
15,145,440
13,848,626
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GARDX INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
4
Operating loss
2023
2022
Operating loss for the year is stated after charging/(crediting):
£
£
Exchange losses/(gains)
32,314
(47,055)
Government grants
-
(9,175)
Fees payable to the company's auditor for the audit of the company's financial statements
54,802
31,450
Depreciation of owned property, plant and equipment
76,268
55,195
Amortisation of intangible assets
148,448
147,553
Operating lease charges
157,556
26,058
5
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Directors
2
2
Administrative
77
65
Total
79
67
Their aggregate remuneration comprised:
2023
2022
£
£
Wages and salaries
1,477,468
1,058,003
Social security costs
163,815
134,887
Pension costs
31,363
25,429
1,672,646
1,218,319
6
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
47,500
29,083
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 3 (2022 - 2).
There are no key management personnel in the group other than the directors.
- 16 -
GARDX INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
7
Finance costs
2023
2022
£
£
Interest on bank overdrafts and loans
50,618
15,943
Interest on finance leases and hire purchase contracts
185
341
Other interest
91,343
76,120
142,146
92,404
8
Taxation
2023
2022
£
£
Deferred tax
Origination and reversal of timing differences
(254,121)
(107,178)
Changes in tax rates
3,400
Total deferred tax
(254,121)
(103,778)
The actual credit for the year can be reconciled to the expected credit for the year based on the profit or loss and the standard rate of tax as follows:
2023
2022
£
£
Loss before taxation
(1,613,374)
(379,120)
Expected tax credit based on the standard rate of corporation tax in the UK of 19.00% (2022: 19.00%)
(306,541)
(72,033)
Tax effect of expenses that are not deductible in determining taxable profit
5,806
(1,723)
Effect of change in corporation tax rate
(20,400)
Depreciation on assets not qualifying for tax allowances
4,434
4,362
Amortisation on assets not qualifying for tax allowances
19,513
Deferred tax adjustments in respect of prior years
113,479
(7,878)
Rounding on deferred tax
(771)
171
Permanent capital allowances in excess of depreciation
(2,846)
(6,277)
Difference in deferred tax rate
(88,200)
Other differences
1,005
Taxation credit for the year
(254,121)
(103,778)
From 1 April 2023 the corporation rate increased to 25% on taxable profits over £250,000. Taxable profits less than £50,000 have been taxed at 19% with a marginal rate applied for profits between these amounts.
- 17 -
GARDX INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
9
Dividends
2023
2022
£
£
Final paid
500,000
10
Intangible fixed assets
Trade mark
Website
Total
£
£
£
Cost
At 1 June 2022
1,027,000
1,027,000
Additions
54,492
269,889
324,381
At 31 May 2023
1,081,492
269,889
1,351,381
Amortisation and impairment
At 1 June 2022
675,318
675,318
Amortisation charged for the year
148,448
148,448
At 31 May 2023
823,766
823,766
Carrying amount
At 31 May 2023
257,726
269,889
527,615
At 31 May 2022
351,682
351,682
11
Property, plant and equipment
Freehold land and buildings
Improvements to property
Fixtures and fittings
Computers
Motor vehicles
Total
£
£
£
£
£
£
Cost
At 1 June 2022
516,069
126,372
52,574
113,684
78,387
887,086
Additions
58,321
37,239
27,000
122,560
At 31 May 2023
516,069
126,372
110,895
150,923
105,387
1,009,646
Depreciation and impairment
At 1 June 2022
63,784
43,178
27,257
59,348
16,146
209,713
Depreciation charged in the year
10,321
13,016
13,223
23,131
16,577
76,268
At 31 May 2023
74,105
56,194
40,480
82,479
32,723
285,981
Carrying amount
At 31 May 2023
441,964
70,178
70,415
68,444
72,664
723,665
At 31 May 2022
452,285
83,194
25,317
54,336
62,241
677,373
- 18 -
GARDX INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
12
Investment property
2023
£
Fair value
At 1 June 2022 and 31 May 2023
395,000
The fair value of the investment property has been arrived at on the basis of a valuation carried out at 10 February 2022 by Vail Williams LLP. The valuation was made on an open market value basis by reference to market evidence of transaction prices for similar properties.
If investment properties were stated on an historical cost basis rather than a fair value basis, the amounts would have been included as follows:
2023
2022
£
£
Cost
223,630
223,630
Accumulated depreciation
-
-
Carrying amount
223,630
223,630
13
Fixed asset investments
2023
2022
£
£
Unlisted investments
184,506
40,006
Movements in non-current investments
Investments
£
Cost or valuation
At 1 June 2022
40,006
Additions
144,500
At 31 May 2023
184,506
Carrying amount
At 31 May 2023
184,506
At 31 May 2022
40,006
14
Inventories
2023
2022
£
£
Finished goods and goods for resale
1,813,613
1,580,405
- 19 -
GARDX INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
15
Trade and other receivables
2023
2022
Amounts falling due within one year:
£
£
Trade receivables
3,772,243
3,381,541
Corporation tax recoverable
364,834
422,354
Amounts owed by group undertakings
733,292
1,023,301
Other receivables
2,957,205
3,378,227
Prepayments and accrued income
367,827
209,414
8,195,401
8,414,837
2023
2022
Amounts falling due after more than one year:
£
£
Other receivables
44,000
44,000
Deferred tax asset (note 20)
391,200
119,500
435,200
163,500
Total debtors
8,630,601
8,578,337
Included in other debtors is a loan of £237,480 (2022: £237,480) to a significant customer of the company. In addition to this loan, the same customer owes the company £576,817 (2022: £1,094,839) in respect of trade debts. There is not an agreement in place in respect of interest charges or repayment terms for whether the loan or the trade debts, however, the directors of Gardx International have influence over the management of the customer's business and confirm the customer has recently won a major contract which will provide the liquid resources to repay these debts. Since the year end, the above company has become a connected company.
The company has a loan with its fellow subsidiary, Gardx Protection Limited of £733,292 (2022: £1,023,301). The subsidiary is no longer trading but has assets in the form of non-trading loans. These loans are to related parties and there is no repayment terms. The timing of the intercompany debt is therefore dependant on the timing of the recovery of the non-trading loans in the subsidiary. Given there is no formal repayment terms it's appropriate to classify the debt as due within one year.
16
Current liabilities
2023
2022
Notes
£
£
Bank loans and overdrafts
18
11,687
19,846
Other borrowings
18
521,648
413,958
Trade payables
3,731,064
3,074,408
Corporation tax
422,405
480,380
Other taxation and social security
136,547
440,176
Other payables
2,341,319
1,071,819
Accruals and deferred income
1,189,096
1,842,288
8,353,766
7,342,875
- 20 -
GARDX INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
17
Non-current liabilities
2023
2022
Notes
£
£
Bank loans and overdrafts
18
530,209
558,186
Other borrowings
18
907,543
1,529,247
1,437,752
2,087,433
Amounts included above which fall due after five years are as follows:
Payable by instalments
476,169
504,927
18
Borrowings
2023
2022
£
£
Bank loans
541,896
575,738
Bank overdrafts
2,294
Other loans
1,429,191
1,943,205
1,971,087
2,521,237
Payable within one year
533,335
433,804
Payable after one year
1,437,752
2,087,433
The security takes the form of a mortgage and a fixed and floating charge over the assets of the company.
The company has two bank loans payable at 2.33% and 3.09% over base rate. The bank loans are repayable over 240 months and 180 months respectively. In addition it has a fixed rate loan repayable over 60 months at a rate of 4.9%.
Both bank loans have been repaid post year end, as the properties they were secured over have been sold and the loans repaid.
Other loans are in relation to COVID-19 bounce back loans.
19
Provisions for liabilities
2023
2022
£
£
Car Maintenance Plans and Tyre & Wheel Alloy Plan costs
2,187,659
1,324,410
- 21 -
GARDX INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
19
Provisions for liabilities
(Continued)
Movements on provisions:
Car Maintenance Plans and Tyre & Wheel Alloy Plan costs
£
At 1 June 2022
1,324,411
Additional provisions in the year
1,191,840
Reversal of provision
(328,592)
At 31 May 2023
2,187,659
20
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:
Liabilities
Liabilities
Assets
Assets
2023
2022
2023
2022
Balances:
£
£
£
£
Accelerated capital allowances
52,100
34,500
-
-
Tax losses
-
-
390,500
118,700
Retirement benefit obligations
-
-
700
800
Investment property
39,000
39,021
-
-
91,100
73,521
391,200
119,500
2023
Movements in the year:
£
Asset at 1 June 2022
(45,979)
Credit to profit or loss
(254,121)
Asset at 31 May 2023
(300,100)
21
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
31,363
25,429
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.
- 22 -
GARDX INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
22
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
100
100
100
100
Ordinary shares have attached to them full voting, dividend and capital distribution (including on winding up) rights.
23
Non-distributable profits reserve
Included within retained earnings are non-distributable amounts of £128,549 (2022: £128,528). These are made up of revaluations on investment property, less any associated deferred taxation liability.
24
Financial commitments, guarantees and contingent liabilities
The company has granted a guarantee of £44,000 (2022: £44,000) in favour of the bank, in respect of a related party company.
Gardx Protection Limited guarantees up to £483,750 (2022: £483,750) within Gardx International Limited as at 31 May 2023. This guarantee shall remain in force until a long-term loan has been satisfied. There is a also a debenture in place in relation to this loan.
Gardx Assure Limited guarantees up to £640,000 (2022: £640,000) within Gardx International Limited as at 31 May 2023. This guarantee shall remain in force until a long-term loan has been satisfied. There is also a debenture in place in relation to this loan.
A shareholder holds two guarantees up to £725,000 (2022: £725,000) within Gardx International Limited as at 31 May 2023. This guarantee shall remain in force until the two long-term loans has been satisfied. The shareholder has also provided a guarantee of their personal property on a secondary loan within the company. These guarantees remains in place until the long-term loans have been satisfied.
A loan held by the company is secured by a cross guarantee and debenture between, the company, Gardx Assure Limited and Gardx Holdings Limited. The extent of the contingent liability at the year-end amounted to £2,050,000 (2022: £2,050,000).
25
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
278,328
103,419
Between two and five years
652,626
153,979
930,954
257,398
- 23 -
GARDX INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
26
Events after the reporting date
Post year-end the investment property and a property held within fixed assets has been sold for £1,280,000.
In addition, since the year-end the company has secured an invoice financing facility of £1.5m
27
Ultimate controlling party
The ultimate parent company is Gardx Holdings Ltd. Their registered office is Lake House, 2 Port Way, Port Solent, PO6 4TY.
Gardx Holdings Ltd prepares consolidated financial statements and copies can be obtained from Companies House.
The ultimate controlling party is Mr V A Coutin.
28
Related party transactions
The company has loan balances due to/from other companies that are related parties by virtue of common control. There are no repayment terms for these loans and interest has not been charged, they are all treated as being repayable on demand:
At the year end, £741,618 (2022: £1,228,281) was due from a company under common control and £34,895 (2022: £Nil) was due to the same company. There was sales within the period totalling £45,800 (2022: £84,813) and purchases totalling £39,254 (2022:Nil) to this related party.
At the year end, £2,093,596 (2022: £926,438) was due to a company under common control. There was also a debtor in relation to a subordinated loan held for £44,000 (2022: £44,000). There were no sales or purchases with this company in the current year,
At the year end, £237,480 (2022: £237,480) was due from a company under common control and £44,731 (2022: £44,731) was due to the same company. There was sales within the period totalling £24,300 (2022:£Nil),
At the year end, £576,818 (2022: £1,098,057) was due from a company under common control. There was sales within the period totalling £478,584 (2022: £603,209).
At the year end, £277,560 (2022: £148,292) was due from a company under common control and £220,925 (2022: £45,925) was due to the same company. There was sales within the period totalling £129,267 (2022: £146,506).
At the year end, £47,943 (2022: £46,980) was due from a company under common control. There were no sales or purchases with this company in the current year.
At the year end, £667,899 (2022: £106,862) was due from a company under common control. There were no recharges within the period to this company (2022: £1,170,316).
At the year end, £2,990 (2022: £294) was due from a company under common control. There were purchases within the period totalling £23,772 (2022: £74,506). Amounts were waivered by the company during the period amounting to £98,278 (2022: £nil).
- 24 -
GARDX INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
29
Directors' transactions
Dividends totalling £500,000 (2022 - £0) were paid in the year in respect of shares held by the company's directors.
Description
% Rate
Opening balance
Amounts advanced
Interest charged
Amounts repaid
Closing balance
£
£
£
£
£
Mr V A Coutin -
2.00
1,751,419
1,145,390
19,565
(1,960,236)
956,138
Mr V L Coutin -
2.00
-
61,609
399
-
62,008
1,751,419
1,206,999
19,964
(1,960,236)
1,018,146
- 25 -
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